House Approves Fix For MergerAccounting

WASHINGTON - (06/14/05) -- The House overwhelmingly approved abill Monday that would bypass an impending financial accountingrule and allow credit unions to continue 'pooling,' or combiningtheir net worth after mergers. The bill would redefine net worthfor federally insured credit unions to bypass an impending rule bythe Financial Accounting Standards Board that would bar the poolingof net worth after mergers, thereby discouraging mergers. The networth bill must still be approved by the Senate. NCUA and thecredit union lobby believe passage of the net worth bill iscritical, otherwise credit unions would be barred from counting thenet worth of a merged credit union, thereby discouraging mergers,especially those of troubled credit unions with diminished networth.