WASHINGTON (5/14/10)—The National Credit Union Administration (NCUA) needs to provide credit unions with more guidance on its assisted merger process and needs to make clear how credit unions may be considered as an acquiring credit union. Those points are just two of many found in the Credit Union National Association’s (CUNA’s) new Mergers Task Force report, submitted to the NCUA this week. The task force was formed early in 2010, in part, in recognition of the complex issues facing credit unions and the impact consolidations may have on the future of the overall credit union system. The task force, headed by Paul Mercer, president of the Ohio Credit Union League, also made these recommendations to the agency as it revises its merger rules. The NCUA’s proposed changes should:
* Address the agency’s criteria for using a purchase-and-assumption approach under which, for example, assets are sold to one or more credit unions, versus an assisted merger; * Address the role of the agency in assuming the success of the merger, including a transition period following the merger approval; * For state credit unions, address how NCUA shall coordinate with the state credit union supervisors; and * Solicit comments from the credit union system on the proposal.
The CUNA task force also suggested NCUA provide more information on its website regarding mergers, including the process for considering merger candidates and expectations for the acquiring credit union. Further, the NCUA, in conjunction with CUNA, should conduct a thorough study involving all issues surrounding mergers, including the long-term impact on the credit union system of the current pace of mergers, the report said. Such a report should be made available to the credit union system and updated periodically, CUNA added.