Another difference is that credit union executive officers often are more reflective of mainstream America, and the people who sit on credit union boards are members, too. And they frequently compete directly with banks.īut one difference is that credit union profits are plowed back into their operations to help lower loan costs and boost deposit interest rates for the benefit of members. They offer most of the same products and services as banks, from checking accounts and mutual funds to car loans, home mortgages and business loans. "Absolutely, we're OK." What does a credit union do, and how do they differ from banks?Ĭredit unions are not-for-profit institutions that cater to customers or members who share a common bond, whether it's employment in a certain industry, military service, membership in the same religious denomination, people living in the same state or something else. "They want to know if we're OK," Reedy said. Kim Reedy, president and CEO of OneAZ Credit Union, said his Phoenix-based institution has fielded more questions in recent days from concerned customers following the failure of Silicon Valley Bank and the continuing unease around other regional banks such as Alliance Bank of Arizona and its parent, Phoenix-based Western Alliance Bancorporation. The failure of Silicon Valley Bank and heightened concern over the fragility of the banking system could drive membership gains for credit unions, which provide many of the same financial services but with different motivations - and with different repercussions when they fail. Watch Video: Silicon Valley Bank, Signature Bank collapse.
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