FOR IMMEDIATE RELEASE
ICBA Supports Right of Credit Unions To Choose Savings Bank Charter
Commends Reps. McHenry and Bachus for Role in Examining Conversion
Washington, D.C. (May 11, 2006)—The Independent Community Bankers of America (ICBA) told Congress that it strongly supports the right of a credit union to convert to a mutual bank charter. ICBA commends Rep. Patrick McHenry (R-N.C.) for taking a leadership role on this issue and Rep. Spencer Bachus (R-Ala.), chairman of the House Financial Services Subcommittee on Financial Institutions and Consumer Affairs, for holding a hearing to examine credit union charter conversions.
"Recent actions by the National Credit Union Administration are nothing more than attempts to obstruct the right of a credit union to convert to a mutual savings bank," ICBA told lawmakers in a statement regarding H.R. 3206, the Credit Union Charter Choice Act. "Credit unions should be free to convert and not be intimidated by an agency that seems to be intent on placing obstacles in front of institutions that seek to convert their charters."
H.R. 3206, introduced by Rep. McHenry, seeks to prevent NCUA from improperly blocking credit union conversions, by limiting the agency's ability to require biased information to be included in disclosures to credit union members. The bill addresses actions NCUA took last year to prevent conversion of two Texas credit unions to mutual bank charters. ICBA also recommended that Congress consider taking additional action to that contemplated in H.R. 3206, and further restrict the agency's role in light of recent NCUA efforts to block the conversion of the Dearborn (Mich.) Federal Credit Union. Specifically, ICBA recommended removing NCUA's power to veto credit union conversions. The law should not require both the NCUA and the new regulator to approve the conversion.
This legislation is necessary to ensure depository institutions have the right to choose their charters while maintaining safety, soundness and consumer protection standards. NCUA has repeatedly thrown up unjustifiable roadblocks against credit unions seeking to select the charter type that enables them to best serve their customers.
Read ICBA's full statement at www.icba.org.