Number: RS22364
Title: Conversion of Credit Union Charter to Mutual Savings Bank Charter: Current Legal Process and Congressional Response
Authors: Michael V. Seitzinger, American Law Division 
Abstract: There are several statutory requirements imposed by the Credit Union Membership Access Act (CUMAA) for converting a federal credit union to a mutual savings bank. In addition, the National Credit Union Administration (NCUA), the federal agency that charters and supervises federal credit unions, has issued regulations requiring significant disclosures by a federal credit union attempting to convert its charter to a mutual savings bank. Some of these disclosures are considered by critics to be speculative in nature, such as whether the directors of the converted institution intend later to convert to a stock-issuing entity, thereby possibly enriching themselves. Others believe that this kind of information is at the heart of the conversion process and should be disclosed. H.R. 3206, 109th Congress, was introduced to limit the kinds of disclosures required, in particular disclosures of a speculative nature. On May 11, 2006, the House Committee on Financial Services, Subcommittee on Financial Institutions and Consumer Credit held hearings on the bill. On December 14, 2006, the NCUA approved final rules governing conversions of credit unions to mutual savings banks or mutual savings associations.
Pages: 4
Date: December 21, 2006