PORTLAND, Ore. (2/15/12)--The Oregon Bankers Association is opposing a proposal by Portland, Ore., Mayor Sam Adams to move some city funds to local credit unions and smaller banks. However, the Northwest Credit Union Association (NWCUA) says the city should keep local funds local.
"This is just positioning on behalf of the Oregon Bankers Association and nothing new," said Stacy Augustine, NWCUA senior vice president and general counsel.
"How the public's money is safeguarded and managed should indeed be the paramount concern for the City of Portland when it comes to its banking relationships, just as [Oregon Bankers Association CEO Linda] Navarro pointed out," Augustine told News Now. "We just think the city should consider keeping local funds local."
According to an article in the Portland Business Journal, the bankers association and Wells Fargo oppose the proposal, which would direct the city treasurer to deposit up to $250,000--the maximum that is insured-- into 10 credit unions and other community banks during 2012. The city also would deposit more than $250,000 in a single credit union if it meets certain criteria.
The bankers association, in a letter to the mayor, brought up the old "credit unions were meant to serve people of modest means" rhetoric and said the city would lose tax revenues if it moved its deposits to credit unions. Wells Fargo, which had won the bidding process in 2009 to provide financial services to the city, said in another letter it considered itself a local bank that makes lending decisions locally and keeps deposits in the Portland market.
The article said public sentiment heavily favors the proposal with 15 of 17 comments on the city's website supporting the plan. In addition, 12 comments that were e-mailed to the mayor also favored the move.