BOSTON - State regulators and NCUA have approved the member ballot converting First Priority CU to mutual savings banks, the first credit union conversion to bank under the state’s new law.
The $103-million credit union, known until 2007 as Postal Community CU, is now awaiting approval from the federal Office of Thrift Supervision for a federal thrift charter.
The charter switch caps a five-year process, which required a new law passed by the legislature in 2006 enabling a state-chartered credit union to convert to bank, according to Joe Leonard, general counsel for the Massachusetts Division of Banking.
“First Priority was the lead proponent after they lost the court case,” Leonard told Credit Union Journal referring to a 2005 court ruling rejecting the conversion bid because of a lack of enabling legislation.
One other Bay State credit union, Community CU of Lynn, is also in the process of converting to a mutual savings bank and recently sent out member disclosures. Another credit union, Northeast Community CU, is in the process of merging into a mutual savings bank.
