As in the movie, bankers have been portrayed as ruthless money grabbers, with competitors who are caring and community-minded. But life is almost never as clear-cut as it is in the movies, and whether the Potter vs. Bailey analogy is fair depends on whether you talk to an Iowa banker or credit union manager. At Battle Throughout the nation, banks and credit unions have been at battle for years over tax benefits that favor credit unions.
Bankers argue the preferential status gives credit unions an unfair advantage.
Credit unions respond by saying their nonprofit status justifies lower taxation, and they offer an alternative for consumers. With a credit union-related case scheduled for argument early next month before the U.S. Supreme Court, the rhetoric is being turned up a notch. If upheld, the ruling could be devastating to the credit union industry and a boon for bankers who already are facing heavy pressure from mutual funds and other financial services companies. Although virtually all of Iowa's credit unions are state chartered, and the Supreme Court case will affect only those that are federally chartered, the case is being closely watched here. That's because it will set a precedent on how a credit union is able to define itself and may shape future state or national legislation regulating credit unions.