Texas Proposes New CU ConversionRule

AUSTIN, Texas - (02/22/06) -- The Texas CU Department Friday votedto issue for comment proposed changes to the rules governingconversions to mutual savings banks which would allow for a publiccomment period before the vote of the membership. The proposedchanges were precipitated by the two biggest credit unionconversions ever, $1.6-billion Community CU and $1.4-billionOmniAmerican CU, neither of which allowed the members of the twocredit unions giants to weigh in before votes were cast. Theproposed changes would require a credit union to notify its membersthat a conversion is being considered prior to sending out theofficial disclosures and ballots, make information on theconversion available electronically and provide a mechanism formembers to submit their comments on the conversion before ballotsare issued. The Commission, which oversees the CU Department, isexpected to vote on the proposals in June.