July
21, 2005 Vol.
2, No. 7
A Mutual Exchange is a monthly electronic newsletter for
mutual institutions. America’s Community Bankers is as committed to
mutual banks as you are to serving your community. We hope that this monthly
update will keep you current on the issues facing mutual
institutions. We welcome your feedback. Please email
[email protected] with your thoughts, comments and
suggestions.
Bill on Credit Union Conversions Introduced
The Credit Union Charter Choice Act of 2005 (HR. 3206),was
introduced by Rep. Patrick McHenry (R-N.C.) and Rep. Edolphus Towns
(D-N.Y.) at the request of America’s Community Bankers.
Click here to read ACB’s press release on the bill. We urge
you to contact your Representative and ask them to support or
co-sponsor this legislation.
Click here to send a letter to your Representative. ACB has been
the industry leader on the issue of charter choice, and we have
expanded our advocacy to include credit unions wishing to convert to
mutual savings banks.
Credit Union Sues NCUA Over
Conversion
Community Credit Union, one of two Texas credit unions in the
conversion process to a mutual bank, has filed a lawsuit against the
NCUA over the agency’s decision to invalidate its conversion vote.
The credit union filed suit to force the NCUA to approve the vote
and to return Community’s $10 million deposit in the National Credit
Union Share Insurance Fund. The OTS, FDIC and Texas Credit Union
Department have all approved Community’s conversion application.
ACB’s Board of Directors approved possible legal support of the
conversion effort.
FDIC Proposes Raising FDICIA Threshold
At the July 19 Board Meeting, the FDIC issued for comment a proposed
amendment to Part 363 of the FDIC regulations that would raise the
asset threshold from $500 million to $1 billion for the required
internal control assessments by management and external auditor
attestations of these assessments; and for the requirement that
members of the audit committee must be outside directors,
independent of management. In a March letter, ACB requested this
action by the FDIC to provide regulatory relief to smaller
institutions currently subject to Part 363.
Click here to read the FDIC press release. ACB will comment on
this proposal.
Final CRA Rules Issued
The final rules approved by the the federal banking
agencies raise the small bank asset size to $1 billion. This change reduces the regulatory burden for community banks under $1
billion by eliminating the need for these banks to collect and
report CRA loan data. The OTS had already amended the definition of
a small savings association to include associations with $1 billion
of less in assets. The banking agencies also adopted a community
development test for those institutions between $250 million in
assets and $1 billion in assets. The final rule is effective
September 1, 2005.
Click here to read the joint agency press release.
Ineligible Investors Warned on Mutual-to-Stock
Conversions
The recent civil charges filed by the SEC against a man who
illegally obtained shares of NewAlliance Bancshares Inc. during the
conversion process prompted
federal regulators to issue a warning to depositors of converting mutuals. In the NewAlliance case, outside investors loaned money to
depositors who bought shares of the stock and split the profits when
they sold the shares.
Click here for a copy of the alert.
to top
We welcome your article submissions for future editions of the
newsletter. Email
[email protected] with your ideas and feedback.
If you would like your staff members or
a colleague to receive this newsletter, please send their names,
bank name and individual e-mail addresses to
[email protected].
Forward to a friend
|