Ambivalence Reigns Over CUConversions
DALLAS - (06/13/05) -- In an indication of the mixedfeelings in the credit union movement over conversions to mutualsavings bank, the Texas CU League issued new guidelines Friday thatrefused to criticize conversions. In a reaffirmation of its earlierposition, the board of the Texas league, which has been embroiledin the ongoing conversion of two giant credit unions, recognizedthat some traditionalists may condemn the conversions but others inthe credit union movement defend a credit union's ability to changecharters. Credit union executives have mixed feelings aboutconversions, Dick Ensweiler, president of the Texas League, toldThe Credit Union Journal last week. Since Community CU andOmniAmerican CU have begun the process to change charters, thenational debate has focused on the issue, noted Gary Tuma,president of Smart Financial CU and head of the league's task forceon conversions. "Opinions about how to address the issue have beenanything but unanimous, with some credit union leaders calling forthe League to launch a public assault on the conversion efforts andothers calling for the League to let credit unions do what theywant." As a result, the league said it will: seek to broaden thecredit union charter to dissuade conversions; seek morecomprehensive disclosure requirements from state regulators; andhelp the public and credit union members better understand theramifications of conversions. But, the task force said and theboard concurred, "it is not appropriate for the Texas CU League toactively interfere with a business decision made by an individualcredit union."