When it comes to credit union gospel, Dennis Dollar, the National Credit Union Administration's newest board member, is orthodox.

Taxation? It would just erode credit unions' retained earnings, their key to safety and soundness. Community reinvestment? Credit unions practically invented the term. The semantic debate over "common bonds"? An invention of career-climbers at bank trade groups.

"I don't think anyone wants to see a proliferation of tiny, undercapitalized credit unions that cannot grow and prosper in the marketplace," says Mr. Dollar. "It is not good public policy."

The 44-year-old Mississippi Republican, now in his sixth month on the NCUA board, won't budge an inch on such questions. But he insists that he is not averse to working with banks.

While president and CEO of $32 million-asset, 12,500-member Gulfport (Miss.) VA Federal Credit Union, Mr. Dollar says his employees routinely referred mortgage, trust, and commercial business-products the credit union did not offer-to local banks.

"The overwhelming majority of the bankers in my community are not obsessed with the credit union issue," he says.

In Mr. Dollar's ideal world, credit unions and banks would build on local courtesies by joining forces on issues of mutual interest, such as bankruptcy, regulatory, and tort reform.

"I guarantee that the banks' bottom line is being more adversely impacted by bankruptcies" and legal costs than by credit union competition, says Mr. Dollar.

Gulfport bankers don't share Mr. Dollar's rhapsodic vision. "The competitive side is anything but harmonious," says George A. Schloegel, president of $1.5 billion-asset Hancock Bank, the city's largest financial institution. Mr. Schloegel, who also heads the state bankers association, calls Gulfport VA's growth rate "astounding."

"If they have made referrals, we're very grateful. We've also been a sponsor of their golf tournament. But that does not erase the issue of their needing to pay taxes."

Mr. Dollar joined the NCUA board at a low point in its public image and private reality. An Office of Personnel Management report had cited improper hiring practices. Public meetings showcased infighting that went beyond ideological differences. At times, all that seemed to be missing from the handsome boardroom were padded walls.

To this tense environment, Mr. Dollar has brought a touch of civility and levity. "I hope that I have been an influence in helping the board to realize that we have got to work together ... and that you can disagree without being disagreeable."

So far the one-time Democrat appears to have stayed above the fray. In public board meetings he appears at ease, shaking hands and working the crowd like the pol he once was-and may be yet again. He served two terms in the Mississippi Legislature but lost a bid for Congress in 1996.

Rosemary George, public relations manager for the National Association of Federal Credit Unions, says Mr. Dollar's dual experiences serve him well. "He understands politics as well as credit unions, so I think he was a great choice."

She is not alone in praising Mr. Dollar. Dan Mica, executive director of the Credit Union National Association, says he "brings a level of knowledge that is very, very deep" and understands how the board's decisions will play out in individual credit unions.

Even bankers' trade groups admire him. "We might differ with principles and issues he supports, but that's separate and apart from his approach to service on the board," says John C. Rasmus, senior federal administrative counsel at the American Bankers Association. "He appears to be an effective member."

Mr. Dollar's openness and sense of humor serve him well. Though fellow board member Yolanda T. Wheat is ideologically similar, her reticence makes her less knowable, and her willingness to battle openly with Chairman Norman E. D'Amours can make her seem quarrelsome. "You know that if Norm says it's Thursday, Yolanda says, 'In some parts of the world, it's Friday,'" says credit union consultant Geoff Bacino.

According to one credit union higher-up, Mr. Dollar has become "an absolute powerhouse" because of the Wheat-D'Amours feud.

But Ms. Wheat has only good things to say about the Mississippi native. "I enjoy working with Mr. Dollar," she says. "His no-nonsense approach to agency decision-making as well as his quick wit and sense of humor have been greatly appreciated."

Mr. D'Amours would not comment for this article.

Civility-or what passes for it at the NCUA-could not have arrived at a better time. The Supreme Court's recent decision on the AT&T Family Federal Credit Union case has put credit unions more on the defensive than at any time in recent memory.

In the wake of that ruling, lawmakers are contemplating fundamental changes in the nature of federal credit unions, such as imposing CRA-type requirements.

Mr. Dollar argues that letting employers band together has diversified and strengthened credit unions, while opening membership to workers from small companies. He cites his former credit union as an example. Gulfport VA has about 150 separate employer groups, many with less than a couple dozen employees. Few if any are large enough to produce 500 credit union members, he says, the minimum required for certification.

Gulfport's progenitor, the Gulfport VA Medical Center, had nearly 2,000 employees upon formation, but now has fewer than 200. "If my credit union were tied solely to that sponsor group, it would be a safety-and-soundness concern today," says Mr. Dollar.

Mr. Dollar doesn't buy claims that oversized nonprofits are hurting banks. He points to data which show that credit unions' share of deposits is steady, and says that while some credit unions are beating their local banks on niche products like auto or personal loans, they are "not even in the same ball game" on commercial or real estate lending.

If Congress decides to diminish the federal credit union charter, a rash of credit unions might try to convert. Those seeking a community or state charter should not have too much trouble, provided they have a solid plan for reaching all segments of the community. But those seeking to leave the credit union fold will encounter an extremely difficult procedure.

"I think the process should be onerous," says Mr. Dollar, who supports current impediments to mutual thrift conversions.

On issues internal to the credit union community, Mr. Dollar's free- market philosophy comes through. He opposes exclusions that protect occupation-based credit unions from encroachment by newly converted community credit unions, preferring to let citizens choose. He also favors "moral suasion" over community lending quotas.

Both stances put him in direct conflict with Chairman D'Amours. At the March 19 board meeting, even Mr. Dollar, who prides himself on his team play, could be seen exchanging exasperated glances with Ms. Wheat.

But Mr. Dollar can content himself with one thought: If a Republican wins the presidency in 2000, we may soon be calling him "chairman."

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