Lately, larger banks aren’t only implementing fees in response to tighter regulations, they’re reviewing their banking relationships and ending those that are no longer aligned with their current business strategy. And those abruptly closed accounts include even those with long-term, faithfully paying credit unions.
Recently, we’ve learned that credit unions that have had long-standing accounts with major banks are receiving letters that their accounts will be closed in precisely two months. These credit unions were vicitims of abruptly realigned business strategies and they now have to scramble to find a new institution to put their money to secure processing services. Will they choose another large bank, a smaller bank, or a cooperative?
That’s how the for-profit world works. If it doesn’t make smart business sense, it’s gone. There’s nothing wrong with trying to make a buck, but if you have a relationship with a profit-driven institution, you have to be aware that one day you’e in, but the next day you could be out.
When it comes to reliability, corporate credit unions offer a distinct advantage over profit-driven institutions. Like credit unions for individual members, the nation’s 27 corporate corporate credit unions are driven to serve their credit union members instead of turning an impressive profit. They prioritize service and support over the bottom line.
AGC Credit Union($16.5M, Kingsport, TN), which is a member of Nashville-based Volunteer Corporate Credit Union, is among the roughly 20% of credit unions that have depostits with corporate credit unions. CEO Darlene Winegar says the corporate provides the small credit union with “tremedous value” and “peace of mind,” according to her quote on VolCorps’ webiste.