Just make them an offer they can't.... understand.
The proposed west coast merger between BECU and SAFE credit unions has been all in the news [CUDaily] & [Filson blog]. The merger would create a $33 billion credit union, fourth largest in the U.S.
The financial health of a credit union can usually be diagnosed by looking at just a few measurements: capital level, earnings, delinquency, liquidity, and operating costs. These two credit unions are performing well on all fronts! Both strong organizations.
✔ The only real question on this merger is why the SAFE CU Board is "giving away" the credit union at the expense of every SAFE member? No question this is a great deal for BECU, and a very, very poor deal for every SAFE CU member-owner.
✅ SAFE members might like to request this simple alternative merger proposal: Pay out $1,639 to each and every member of SAFE CU (244,000 folks) on the date of merger. The payout is equal to the member-owned reserves of SAFE CU (@$400 million).
After the merger, former SAFE CU members can enjoy all the benefits promised by the combined BECU merger proposal... and enjoy the $1,639 for a short vacation or a little X-mas shopping.
After the merger and the fair payout, the newly merged BECU will remain a solid, safe and sound credit union with combined assets of $33 billion and with a combined, sterling capital ratio of @11%!
Whoever is advising the SAFE CU Board on this proposed merger might want to re-review the concepts of "fiduciary duty" and personal liability with them. And mention, how tenacious California class-action lawyers are when they smell blood in the water...
That contested $400 million in member equity at SAFE CU can feed a lot of sharks.
** For the entire Godfather series click the "Godfather" button at top.
FYI $400 million in total SAFE CU member-owned reserves/244,000 SAFE CU members = a $1,639 ownership interest per SAFE member..
ReplyDeleteReally big misread on this. You have it backwards. There is nothing in this for existing BECU members. Their capital is diluted by taking SAFE on, it will be a management distraction, and it will drop BECU’s OpEX from 3.43 to 3.30%
ReplyDeleteCalifornia sharks usually charge a 25% contingency fee on this type slam dunk class action . No money up front, no financing needed.
ReplyDeleteFor the possibility of earning $100 million on this case, won't be hard to attract a few legal sharks.
SAFE members will be represented, count on it. Even if we only get 1200 bucks each after legal fees, i'm in.
“The Spider and the Fly”
ReplyDeleteAlas, alas! how very soon this silly little fly,
Hearing his wily, flattering words, came slowly flitting by;
With buzzing wings she hung aloft, then near and nearer drew,
Thinking only of her brilliant eyes, and green and purple hue;–
Thinking only of her crested head – poor foolish thing! – At last
Up jumped the cunning spider, and fiercely held her fast.
He dragged her up his winding stair, into his dismal den,
Within his little parlour – but she ne’er came out again!
– And now, dear little children, who may this story read,
To idle, silly, flattering words, I pray you ne’er give heed:
Unto an evil counsellor, close heart, and ear, and eye,
And take a lesson from this tale, of the Spider and the Fly.
– Mary Howitt (1828)
If Boards are giving CU's away for nothing, that seems really egregious and it would be a really big story with huge implications on personal board liability, as well as the NCUA, which is clearly allowing it to happen. It actually would be the biggest story in the history of the movement, and I am pretty perplexed as to why no is doing anything about it.
ReplyDelete