April 30, 2007


Comments

 
 
 
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    Anonymous
     
     
     
  • A merging credit union deserves to get the best deal from the continuing credit union that it can, including member payouts and executive compensation and/or severance. To do less would be shirking the board’s fiduciary duty to look out for the best interests of the credit union, its membership, and their future. Regardless of these credit union leaders’ influences or motivations, it is their job to decide on their merger partner and the details of the merger plan and agreement, not NCUA or the trade associations.

    As some pundits have observed, many credit unions are in the process of “self-liquidating.” The industry would be better served if these credit unions consolidated their assets and members with larger, financially healthy, full-service institutions. To ensure an industry-saving vigorous rate of consolidation, merger incentives are essential. This deal-making factor is especially needed if NCUA intends to obstruct the alternative tactic of unsolicited or so-called “hostile takeover” mergers, as appears to be the case.
    Marvin Umholtz
     
     
     
  • Excellent points. during the Wings situation, I was arguing these same points. To my mind, the Continental members were MORE informed about the merger process in that situation then the members of most credit unions that eventualy merge. By bringing the members into the mix, I argued that Wings was actually making the process more democratic.
    Anonymous