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Conversion merger one-sided deal says CEO
AUGUSTA, Maine (10/9/08)--Paul Guerrette, vice president of Alliance of Maine FCU and former member of Kennebec Valley FCU (KV FCU), says he is “both personally and philosophically opposed” to the merger of KV FCU with another local bank. Guerrette wrote a column Wednesday in the Kennebec Journal about KV FCU’s proposed merger in response to another column written by Kennebec Savings Bank President Mark Johnston. Guerrette acknowledged that he should support the proposed merger because it would take a competitor out of his market, but argued against it. KV FCU's board is scheduled to vote Tuesday on a proposal to convert to a federal mutual savings bank. Immediately following the conversion, the credit union would merge into the bank (News Now Sept. 10). KV FCU members may submit comments to the credit union about the merger until 5:30 p.m. today. If the board approves the proposal for the conversion and merger, the proposal will be submitted to the credit union’s membership for a vote following a notice period that is no longer than 90 days, the credit union said on its website. If KV FCU merges with Kennebec Valley Savings Bank, only the bank "will survive and become more competitive by increasing its assets, expanding its reach and eliminating a competitor. The credit union will cease to exist," Guerrette said. KV FCU said the conversion and merger would expand its ability to meet the current and future needs of members. “It makes sense to consider combining our efforts with a local institution that has similar values,” said Beverly Beaucage, president/CEO of KV FCU (News Now Sept. 10). According to Guerrette: “If mutual savings banks were ‘just like credit unions’ the Federal Credit Union Act of 1934, which paved the way for the establishment of credit unions across the country, wouldn’t have been necessary.” KV FCU, Augusta, Maine, has $51 million in assets.
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