AUSTIN, Texas — Texas, home to the two biggest credit union conversions to mutual savings bank, adopted new rules Friday that will require credit union management to notify members of a proposal to convert to MSBs before the matter is voted by the board of directors.
The new rules, adopted Friday by the Texas CU Commission, will require that members be sent a notice explaining the details and ramifications of the conversion before a Board vote, according to Harold Feeney, director of the state’s CU Department.
The new rules will also require the credit union to provide a process for members to express their opinion on the conversion proposal.
The new rules will be published this week in the Texas Register and are effective 20 days afterwards, Feeney told The Credit Union Journal.
Last year’s conversions of two credit unions giants, $1.5 billion Community CU and $1.4 billion OmniAmerican CU, caused a major controversy which was only resolved by a federal court order allowing the conversions to be completed.
