By Ray Birch
WASHINGTON-- When the Federal Reserve Bank of Philadelphia released its latest deep dive into credit union growth, much of the industry saw a familiar pattern: strong performance, expanding reach—and yet another suggestion that credit unions may be crowding out community banks or falling short of their mission.
Curt Long reads the same data differently.
For Long, vice president of data and research and chief economist at America’s Credit Unions, the Philadelphia Fed report is less an indictment of credit unions than a reminder of how easily the story can tilt when key context is left out. In his view, the data largely confirms what credit unions have long argued—while also echoing talking points that bankers have pushed for years, often without acknowledging the full competitive landscape.
“There’s actually a lot of good news in that report,” Long said. “It reflects the great work credit unions are doing. But some of the conclusions are a bit misrepresented, and some important pieces are missing.”
What The Fed Got Right
The Philadelphia Fed’s December 2025 report documents a dramatic expansion of credit unions across Pennsylvania, New Jersey, and Delaware over the past two decades, with assets and lending rising sharply as small banks contracted. It also confirms that credit unions are more likely than banks to maintain branches in low- and moderate-income (LMI) neighborhoods and that they consistently offer better rates than banks.
Those points matter, Long said—especially at a time when affordability is dominating consumer finance.
“They do note that credit unions offer better rates than banks,” he said. “Given that affordability is on everyone’s mind right now, that probably deserved more attention than it got.”
The report also highlights credit unions’ strength as consumer lenders and their growing role as small banks pull back from markets and product lines. To Long, those findings reinforce the cooperative model’s relevance rather than raising red flags.
The Missing Comparison
Where Long takes sharper issue is with how the report frames the decline of community banks alongside credit union growth—without fully accounting for the role of large banks.
“The charts show credit union assets going up and community bank assets going down,” Long said. “But there’s a significant missing piece there, which is large banks.”
From a national perspective, Long argues, the biggest shift in market share over the past two decades hasn’t been from banks to credit unions—it’s been from smaller institutions to the largest banks.
“This is the comparison community bankers always want to make,” he said. “They want to suggest that any reduction in their growth is due to credit unions taking market share. But broadly speaking, it’s larger banks that have increased market share far more than credit unions have.”
Leaving that context out, he said, risks reinforcing a narrative that doesn’t match the data.
Bank Purchases And A Familiar Claim
The Philadelphia Fed report also nods to banker concerns about consolidation, noting that a record number of community banks were acquired by credit unions in 2024—a point frequently cited by bank trade groups as evidence that credit unions are shrinking the number of small banks and harming communities.
Credit unions have long argued that rhetoric is simply a distraction.
An Old Assumption, Recycled
Beyond the numbers, Long says the report reflects an implicit assumption that surfaces repeatedly in banker critiques: that credit unions aren’t supposed to compete head-to-head.
“There’s this idea that banks should get first dibs on everyone they want to serve,” he said, “and then credit unions can serve whoever’s left over. We just don’t agree with that.”
Competition, Long argues, benefits consumers—especially when it brings lower rates, better terms, and a stronger presence in communities banks are leaving behind.
“If credit unions weren’t there, consumers would be worse off,” he said. “Everyone benefits from the competition credit unions bring to the marketplace.”
Serving Underserved Communities—And Who Sets The Limits
The Fed report raises questions about mortgage denial rates and lending patterns in LMI neighborhoods, suggesting credit unions may not be reaching underserved borrowers as effectively as small banks. It points to field-of-membership restrictions as one possible explanation.
Long doesn’t dispute that those restrictions matter—but he says the report stops short of asking who keeps them in place.
“Yes—follow that thought through,” he said. “Who is it that always stands in the way when credit unions try to loosen regulatory restrictions so they can expand into underserved areas? It’s the bankers.”
In other words, he argues, some of the very constraints cited as explanations for the data are the result of longstanding opposition from the banking industry itself.
A Story Still Being Written
Despite his critiques, Long welcomes the increased scrutiny.
“Researchers within the Fed system are paying close attention to credit unions, and we think that’s a good thing,” he said. “There’s a great story to tell.”
He points to earlier Philadelphia Fed research on banking deserts that highlighted how credit unions often replace banks that exit underserved areas—data America’s Credit Unions regularly uses to push back on claims that consolidation hurts communities.
“The more spotlight that’s shined on credit unions, the better,” Long said. “When you look at the full picture, the data consistently show credit unions stepping in where others are stepping away—and doing it at better rates, with a stronger consumer focus.”