The boards of 21 of the nation's 43 corporate credit unions, as well as U.S. Central Credit Union, will have to be restructured by Jan. 1, 1996.

The long-time corporate practice of sharing managers with industry trade associations was effectively ended by a regulation approved by the National Credit Union Administration last week.

Critics of the new rule said it will drive up operating costs and destroy cooperation between the industry groups and the liquidity centers.

"It's more economical if everyone moves in the same direction so we can help members," said Carroll D. Beach, chief executive of the Colorado Credit Union League and System United Corporate Credit Union, Denver.

"Under the regulation we can't take advantage of a common board, and there are economies of scale to be had in that."

The management-interlocks regulation bars more than a minority of a corporate's board from serving on a league board. It also bans individuals from serving as chief executive of both a corporate and a league.

Bob Loftus, director of public and congressional affairs for NCUA, did not know how many corporates and leagues share chief executives.

The agency's intent was to prevent conflicts of interest. Corporates and leagues, which are subsidiaries of the Credit Union National Association, frequently do business together.

Mr. Beach said that the regulation could cause a schism in the industry, as some corporates might stan looking toward outside vendors for services currently provided by the league. Also, the organizations might be less likely to cooperate.

Credit unions could suffer if prices go up and the types of services provided is limited, he said.

Rich Helber, president of Central Corporate Credit Union in Detroit, said such fears may be overblown. CenCorp has been a stand-alone institution for 13 years.

"There are situations where integration works best, there are situations where being independent does," he said. "But I'm not alarmed that the credit union system we support is going to collapse."

The president of another corporate, who requested anonymity, said that some industry officials opposed the regulation because they wanted to hang onto power.

"When leagues lose control of corporates the temptation to get sullen, vindictive, and petty is strong," the official said.

Even those officials who fought the new regulation consider it less draconian than earlier drafts considered by the federal regulator.

For instance, a prior proposal would have banned institutions from sharing staff below the level of chief executive.

"At least this one gives us some breathing room," said Thomas E. Delk, chief executive of the South Carolina Credit Union League and the Carolina Corporate Credit Union, Columbia.

Nevertheless, having to hire a new corporate president will lead to higher costs.

"You used to be able to get two presidents for the price of one," said Larry Johnson, chief executive of the North Carolina Credit Union League and president of First Carolina Corporate Credit Union.

"I'd take off my league hat, put on my corporate hat, and the,re was no question I was responsible solely tO the corporate board."

Whether the corporates will have to comply with the regulation remains to be seen. CUNA has threatened to sue the agency if it approved a regulation, and last week the Madison, Wis.-based trade group said it would wait 30 days before making an announcement.

Although other league presidents hedged in saying whether they believed the association should take on the regulator, Mr. Delk didn't mince words.

"My major objection is that the federal government can determine the composition of a board, which is a pretty dismal situation when you get right down to it," he said.

"From my position I'd like to see them [NCUA] challenged, to see if NCUA assumed power inconsistent with the Federal Credit Union Act."

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