Bank Collapses Highlight Alternative Structure of Credit Unions

By Desert Star Staff

The collapse of two banks has put the U.S. financial sector into focus this week.

Some are considering the alternative structures of institutions like credit unions. For example, troy Stang is the president and CEO of the GoWest Credit Union Association, representing more than 300 credit unions in Oregon and five other states.

He said tumult in the financial market historically generates interest in the local structure of credit unions.

“Whether it was with the dot-com bust or with the activities that led up to the Great Recession,” said Stang, “consumers at their kitchen tables started having these conversations more intentionally about who is it that we do our financial services with?”

Silicon Valley Bank’s collapse is the secondlargest bank collapse in U.S. history. The Federal Deposit Insurance Corporation has stepped in to get depositors their money.

Stang noted that the National Share Insurance Fund administered by the National Credit Union Administration is the equivalent regulator for his institutions and is paid for by the credit union system.

Stang said credit unions are not-for-profit and member-owned.

“We’re not accountable to Wall Street investors,” said Stang. “We’re not accountable to other forces outside of our membership. And so it’s a much different model.”

Stang said many credit unions in his association had spent the last week reassuring customers and noting differences in their institutions’ structure from others.

He added that a robust financial system is essential for consumers, regardless of which institution they bank with.

Disclosure: GoWest

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