Community CU Offers Cash Prizes ForConversion Vote
PLANO, Texas - (03/31/05)The $1.4-billion Community CreditUnion has sent its disclosure materials to members as it seeks toconvert to a mutual savings bank. As part of the process it isoffering $20,000 in cash prizes to members to get them to vote. Thecredit union is estimating the cost of the conversion attempt at$1.3 million, according to the materials provided to members. In aletter to members CCU Chairman James McCarley said the credit unionneeds convert in order to raise more capital, citing CCUs7.38% net capital ratio as of Dec. 31. If members approve theconversion, Community Credit Union said it will convert to a mutualholding company structure and later seek to sell approximately $100million in stock, which would require a second vote. That stockwould represent a minority (49%) interest. The credit union hasscheduled a special member meeting for June 21 at the RichardsonCivic Center where members may vote if they want to do so in personrather than by mail. Under Texas law, the conversion is dependentupon a majority of those who cast votes, not by a majority of thetotal membership of 220,000.