DALLAS - (05/18/05) -- A group of Community CU membersfiled a complaint Monday with the Texas CU Department alleging thecredit union giant's proposed conversion to mutual savings bankviolates state law. The complaint also claims credit uniondirectors have violated their fiduciary duty to members. Among thealleged violations of state law: the $1.4 billion credit union'sdisclosures have been inadequate; the credit union has encouragedmembers to vote early and then "unilaterally imposed a ruleprohibiting members from changing their votes after becoming moreinformed on the issue"; members opposed to the conversion have notbeen allowed to present their position to the full credit unionmembership; and the directors' vote to convert to a mutual savingsbank constitutes a breach of their fiduciary duty of loyalty to themembership as directors and management are in a position to receivesignificant monetary and non-monetary benefits not open to themembership as a whole. The complaint was filed by the TexasCoalition for Member Trust, which has changed its named to theTexas Coalition for CU Members.
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The Cleveland-based bank is projecting steady growth in net interest income even as credit losses remain manageable. But Chairman and CEO Chris Gorman also said that he thinks a recession is likely.
April 18 -
The first-quarter increase involved commercial real estate loans, including some problematic multifamily loans and an office credit, but none of the criticized loans were to consumers, officials at the Dallas company say. Further CRE deterioration is anticipated.
April 18 -
The Detroit-based company is exploring ways to make more consumer auto loans without running afoul of stricter capital standards that are expected from the Federal Reserve. Possible approaches include more securitizations and the use of credit risk transfers.
April 18 -
The House Financial Services Committee also sent to the full House two bipartisan bills, including one that would prevent large banks from opting out of having to recognize Accumulated Other Comprehensive Income in regulatory capital.
April 18 -
Charge-offs and nonperforming loans rose at the Georgia bank in the first quarter. But it blamed the problem on one large client and said the matter has been resolved.
April 18 -
Amid healthy first-quarter loan growth and improving credit quality, Discover Financial Services slashed its profits by $800 million to offset remediation costs from a 16-year period when it overcharged certain merchants.
April 18