Washington, D.C. (July 22, 2025) — Independent Community Bankers of America (ICBA) President and CEO Rebeca Romero Rainey issued the following statement after a new acquisition of a taxpaying community bank in California by a tax-exempt credit union with assets exceeding $1 billion.
“Credit unions have a mandate from Congress to serve people of modest means, though we repeatedly see growth-obsessed credit unions exploit their federal tax exemption to acquire taxpaying community banks and widen their already-massive footprints. Since 2010, more than 80% of acquisitions have involved a credit union with more than $1 billion in assets.
“Policymakers must uphold market choice for small businesses and consumers alike by addressing taxpayer-subsidized consolidation of the financial services landscape by billion-dollar credit unions.”
This acquisition in California is the second ever in the state, following the January announcement that Frontwave Credit Union, which has faced bipartisan congressional scrutiny for its fee practices, leveraged its $1.5 billion asset size and tax exemption to acquire a community bank.
Compounding concerns about the acquisition record set last year, billion-dollar credit unions are financing multimillion-dollar NFL stadium naming rights deals, buying private planes for senior executives, and raising funds from Wall Street hedge funds — all while enjoying a taxpayer-funded subsidy worth more than $2.5 billion, if taxed at the same rate as community banks. As Congress weighed tax legislation, a May Bloomberg article captured lawmaker concerns about the full federal tax exemption for credit unions.
Consumers also support reforms to credit union policies. Recent ICBA polling conducted by Morning Consult shows 62% of U.S. adults say credit unions that operate like banks should have to pay taxes like banks, and 62% support a congressional investigation of the credit union industry’s complete tax exemptions and lax regulatory status.
An ICBA policy resolution introduced earlier this year formally calls on policymakers to end the federal tax exemption for credit unions with $1 billion or more in assets.
About ICBA
The Independent Community Bankers of America® has one mission: to create and promote an environment where community banks flourish. We power the potential of the nation’s community banks through effective advocacy, education, and innovation.
As local and trusted sources of credit, America’s community banks leverage their relationship-based business model and innovative offerings to channel deposits into the neighborhoods they serve, creating jobs, fostering economic prosperity, and fueling their customers’ financial goals and dreams. For more information, visit ICBA’s website at icba.org.