HAVERHILL, Mass. – NCUA has thrown out last September’s vote by members of Northeast Community CU to merge into nearby Haverhill Bank and ordered the vote be conducted again under its process to convert a credit union into a mutual savings bank.
The $98 million credit union, which has lost 5% of its assets in this depressed mill town a half hour north of Boston, is seeking to combine with a healthier local savings bank. But NCUA said the brief vote at last September’s annual meeting, where 78 attendees unanimously approved the merger, was not sufficient to satisfy its regulations. NCUA said the credit union must instead allow a mail-in ballot and hold a special meeting where more of its 10,000 members may participate.
Thomas Faulkner, CEO of the $161 million bank, confirmed the NCUA ruling yesterday. He told The Credit Union Journal that his depositors overwhelmingly voted for the merger last July.
The NCUA Board rejected the merger application in closed meeting last week. Officials at NCUA said they would not comment on the ruling.
