ICBA Urges Reform to Credit Union Tax Exemption as 2026 Opens with Acquisition of Tax-Paying Community Bank

Washington, D.C. (Jan. 8, 2026) — Independent Community Bankers of America (ICBA) President and CEO Rebeca Romero Rainey issued the following statement on the year’s first reported acquisition of a tax-paying community bank by a tax-exempt credit union that has already acquired a community bank.

“With tax-exempt credit unions continuing their troubling pace of acquiring tax-paying community banks into 2026, ICBA and the nation’s community bankers continue our call for policymakers to address the harmful impact these deals have on local communities.

“ICBA’s recent data analysis details how these acquisitions are harming small businesses and local communities given community banks are outperforming credit unions in high-poverty areas. As Congress works to advance various policy priorities ahead of the midterm elections, it is time for lawmakers to eliminate the federal tax exemption for credit unions over $1 billion in assets.”

ICBA’s analysis of publicly available data shows:

• More than 80% of acquisitions since 2010 involved a credit union with more than $1 billion in assets, while more than 40% involved a credit union headquartered in a different state than the acquired bank.

• In areas where community banks participated in Small Business Administration lending programs, SBA lending fell after nearly 80% of credit union acquisitions.

• Total mortgage applications decreased in 57% of affected service areas following an acquisition, while the amount loaned per approved mortgage application decreased in 61% of acquisitions and mortgage denial rates increased in 61% of acquisitions.

With credit unions straying beyond their founding congressional mandate of serving people of modest means with a defined field of membership, such as those with the same church or employer, an ICBA policy resolution calls on policymakers to end the federal tax exemption for credit unions with $1 billion or more in assets or to establish tax parity between credit unions and community banks.

ICBA looks forward to continuing to work with the administration and the 119th Congress to advance these critical reforms.

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.