The National Credit Union Administration laid another stumbling block in the path of credit unions that want to become federal thrifts.
Under a rule passed 2-1 by the NCUA board, credit union members voting on a proposed conversion must be told that switching charters could diminish their influence on future decisions.
"The control of the institution will no longer be based on each member having one equal vote," said sample disclosure language provided by the agency. "Votes will be based on the amount of an individual's deposits." That message must appear on the cover page of the disclosure form given to members.
Board Member Yolanda T. Wheat was the lone dissenter. She said the rule would add an unnecessary regulatory burden.
Institutions seeking to become thrifts must also disclose that a conversion would result in loss of tax-exempt status, and that board members could receive compensation two years after the switch.
Portions of the final rule differ from the original version proposed last November. For example, a provision was excised that warned members that they would lose their ownership stake in the thrift if it later converted to stock ownership.
At the same meeting, the board again postponed voting on a controversial plan to impose Community Reinvestment Act-like requirements on community- based credit unions. It also approved the conversion of Ohio Central Federal Credit Union in Dublin to a federal mutual thrift.