More Member Input Sought In CUConversions
ALEXANDRIA, Va. - (06/23/06) -- The NCUA Board proposed amendmentsto agency rules Thursday that would require greater involvementfrom members in decisions to convert to a credit union a mutualsavings bank and to reduce outsiders' ability to profit from thecontroversial process. The proposals, issued for a 60-day commentperiod, would require management to notify members before a boardvotes on the conversion and to provide some mechanism, such as amember comment period, to give members more say in the process. Theproposal would also require boards to share information withmembers requesting it, at the members' expense. It would alsoreduce the mail ballot from a 90-day period to 30 days, reducingthe opportunity for outside speculators, like those anticipating asubsequent stock offering, to gain access to the top tier of stockpurchasers by making deposits in the targeted credit union. Theproposed rule, said NCUA Board member Gigi Hyland, "would helpclarify an area that really has become fraught with controversyover the past several months." The conversion process has comeunder increasing public and congressional scrutiny over the pasttwo years as ever-larger credit unions seek to switch to MSBcharters.