Failure is Not a Permanent Condition

Should Regulatory Policy Make Temporary Failure a Permanent Condition?


This Spring, Arizona Senator John McCain addressed the graduates of Ohio Wesleyan University. “Failure is no more a permanent condition than is success,” said the 73-year-old, imparting a piece of advice that resonates with the credit union system today.

McCain’s thoughts aptly apply to Arrowhead’s June 25 conservatorship. It can, at times, require a nuanced approach to distinguish between institutional failure and performance fluctuation. This is not one of those occasions. As cooperatives, credit unions are afforded the luxury of taking the long view in order to provide their services in bad times as well as good. A regulatory policy that makes temporary “failure” a permanent condition puts that principal – one on which credit unions are founded – in jeopardy.

For more information on the topic, we've compiled a selection of articles about Arrowhead's conservatorship: News of Arrowhead is a Timely Fourth of July Reminder, Regulator’s takeover of Arrowhead Credit Union Raises debate, Credit Unions are Different From Banks,Credit union uprooted,Arrowhead’s data was inaccurate, feds say. For more information on the credit union's financial performance, read Arrowhead Flies Straight in 2010.


July 7, 2010


  • great read.