Our Philosophy
Doubtless many of you have seen recent advertisements and received mailings from
one or more of the larger credit unions in the area. Perhaps you wonder how these
credit unions differ from the B&V Credit Union, your credit union. The following
should help explain those differences, discuss their possible impact on our credit
union, and document the basic philosophy which the Board of Directors intends to
follow.
Traditional vs. Commercial Credit Unions.
Traditional: Founded on the principle of "People
Helping People," the B&V Credit Union was established as an independent
organization of Black & Veatch employees and their families in keeping with
the enabling legislation then in effect for credit unions. At the time, a credit
union's defined field of membership was intended to limit membership to relatively
small, closely-knit groups having a specific, common bond (employees of the same
company, members of the same church, etc.). The essential concept was that members
would help each other by sharing the collective assets of the group at rates (for
both lender and borrower) more favorable than either could easily obtain at a commercial
institution (bank, savings and loan, etc.). As part of that enabling legislation,
credit unions were exempted from taxes (since each member would be taxed individually
on his "share" of the operation) and other regulations applicable to commercial
lending institutions. The B&V Credit Union has always operated under this basic
philosophy.
Commercial: Particularly in the last several years
and for various reasons, many credit unions, founded on the principles noted above,
have been allowed to redefine their field of membership to be quite general to promote
growth by expanding the number of people eligible to belong. With this growth, these
credit unions have also greatly expanded their services, products, staffing, advertising,
etc. to the point that, in many respects, they look and act very much like commercial
lending institutions. This expansion of their products and services as well as the
growth of these credit unions has not gone unnoticed by banks and other lending
institutions who view them as unfair competitors. In fact, in recent years, the
commercial lending community has caused legislation to be introduced which, if enacted,
would have made ALL credit unions subject to essentially the same taxes and regulations
as those with which commercial institutions must comply. Although the B&V Credit
Union joined other credit unions by contributing to a cause opposing this legislation,
we did so with reservations realizing that traditional credit unions such as ours
were not the real targets of the proposed legislation.
It is the objective of the Board to see that the B&V Credit Union is allowed
to continue to operate as a traditional credit union under the basic principles
noted above. We not only want our membership to be aware of the distinctions identified
above, but also to support the Board in fulfilling this objective. While no particular
action by the membership is called for at this time, we hope that you will continue
to look to us first as offering the best lending and borrowing services available
to you and to let us know should we ever fail to measure up. Likewise, should the
need for a more direct response arise, we want to be sure you are informed on this
subject to the point you can be an ally in our efforts. Remember, we all benefit
from favorable rates for both loans and dividends when share deposits are used for
responsible member loans: a real Win - Win proposition.