CUNA Credit Unions on Advocacy Offense! Utah Credit Union Association 2017 Annual Meeting and Convention Jim Nussle CUNA President & CEO

Comparing CU share of total DFI (depository financial institution) assets to CU share of households savings. DFIs are made up of banking institutions (commercial banks and savings institutions) and credit unions. Total assets in banking institutions include quite a few sources of funds that credit unions don’t compete with: large corporate and institutional deposits, negotiable CDs (large money market instruments), foreign deposits, etc.). The credit union share of this total assets market is kept low by these sources of funds that credit unions don’t have access to. The alternative measure, the household savings market, includes everything that is a close substitute for a deposit a member might place in a credit union. By “savings” we mean liquid and low risk. It include all types of deposits owned by households in DFIs (banking institutions and CUs) PLUS savings bonds and non-institutional money market funds. It does NOT include less liquid or riskier financial assets owned by households such as stocks, stock mutual funds, bonds, etc. From 1992 to 2016 (the past 24 years) the CU share of total banking assets has risen form 5.6% to 7%, and increase of 1.4 percentage points. Over the same period, the CU share of total household savings has risen from 7.4% to 9.7%, a gain of 2.3 percentage points. The basic rule of interpretation of change market shares is if your share of a market is rising, you are growing faster than the rest of the market. So, CU’s have outgrown the total market by more than they outgrew DFI total assets. That’s mostly because money market funds have not been popular for the last decade due to very low short-term interest rates, and savings bonds are atrophying as a consumer savings vehicle.

Leadership Focus Leading interdependent and fierce 360° advocacy offense to remove regulatory barriers Promoting better awareness of the “Credit Union Difference” Establishing credit union relevance and providing solutions in a very “disruptive” financial service market Delivering interdependent CUNA/League association value proposition “Growing is Winning”; increasing credit union market share

6,000 1CUNA 50 Represented 58,000 110 million Stronger Together 6,000 States and D.C. by Leagues 6,000 6,000 CREDIT UNIONS credit union service providers 58,000 board members 110 million 273,000 credit union professionals credit union members

75% Strong Foundation Built in 2016 5,000 advocates of Congress signed CUNA/League-initiated letters urging CFPB to exempt CUs 75% 5,000 advocates at CUNA GAC and Hill visits CUNA study: $7.2 billion in regulatory burden, gets attention of policymakers 97% of 364 candidates with CU support won their congressional elections CULAC set record with $5.1 million raised in 2016 CUNA/Leagues held 8,000+ meetings with lawmakers, regulators in 2016 Filings, comment letters, testimony kept issues at the forefront Advocacy at NCUA brought about MBL, FOM reform and exam relief

2017 Advocacy Outlook challenges & opportunities Reduce regulatory burden Expand consumer, biz., access to credit unions Lead on payments and data security Protect tax status Leverage 2016 elections

Washington Landscape BUT: Inertia is to do nothing “Favorable environment” for CUs following elections: CULAC success Congress/administration aligned on goal of reducing regulations On the agenda & at table BUT: Inertia is to do nothing CUs need to be on “Advocacy Offense” for regulatory relief

Political Disruption Requires New & Unique Approach to Advocacy National trade association coordinating with Utah CU Assoc. & all state Leagues. Addressing public policy issues from all angles. Blanketing Hill & Agencies with our Advocacy. 360º ADVOCACY Offense

cuna.org/commonsensereg CUNA M.A.P. League Hike the Hill visits Advocacy at Home Town Halls Branch Visits Op-Eds cuna.org/commonsensereg

Credit Union Solutions Compliance Community Councils Community Small Credit Union Community CPD Online Community Creating Member Loyalty Community

Leadership Focus Leading interdependent and fierce 360° advocacy offense to remove barriers Promoting better awareness of the Credit Union Difference Establishing credit union relevance and providing solutions in a very disruptive financial service market Delivering interdependent CUNA/League value proposition “Growing is Winning”; increasing credit union market share

Thank you! jnussle@cuna.coop 202-508-6744 @nussle