Two-Thirds Vote Needed To Change NumberOf Board Seats
ALEXANDRIA, Va. - (03/28/06) -- Directors of a federal credit unionmay reduce the number of board seats but must obtain a two-thirdsvote to do so, according to NCUA. A change in the number of boardseats amount to an amendment to the Federal CY bylaws, andtherefore, require a two-thirds vote of an FCU's board, NCUA saidin a new legal opinion letter. Requiring the bylaw amendmentprocess for changes to the number of directors prevents smallminorities of a board from acting to manipulate or concentratecontrol, the agency said. Federal CUs may not reduce the number ofdirectors unless a corresponding number of seats are vacant, theregulator pointed out.