The proposed participation of the credit union industry in the nationwide bailout of savings and loans was a last minute coup by the banking industry that credit unions won't stand for.
In fact, if credit unions get their way, they won't take any part in President Bush's proposal to rescue the nations savings and loans and shore up the safety of banks."You can't strengthen the weak by weakening the strong," declared Roger W. Jepsen, chairman of the National Credit Union Administration Board, which regulates and insures most of the nation's credit unions.
Jepsen was in Salt Lake City Friday for the NCUA's monthly board meeting, hosted by the Utah League of Credit Unions.
In an interview with the Deseret News, Jepsen said that the current proposal would weaken the NCUA's deposit insurance fund and within eight years place it in the same sick status as the bankrupt Federal Savings and Loan Insurance Corp.
Under the Bush proposal, the National Credit Union Share Insurance Fund would have to change its funding procedures from placing one percent of deposits with the fund to paying an annual premium. Jepsen claims the change was slipped in after Bush announced his plan and before the plan was sent to congress.