... Right?
"Come on Down!" Lots of push back on the issue of credit union capital/reserves - member equity!
Evidently those who are mis-hawking "the benefits" of credit union mergers are up in arms over the premise that they appear to be peddling a harmful mishmash of snake oil. Credit union boards have started asking serious questions about their fiduciary responsibility and have awakened to their legal liability. Expect a fuss - and a fight over the future of tens of billions of dollars in member equity.
One commenter sought to claim that the rules of economics, stockholder-rights, and common sense should not apply to credit union mergers. After all, credit union members were much like financial Bambi's - naive, vulnerable, doe-eyed - and must be "protected" from the real world. And besides, those billions of dollars in member equity are "virtual" - not real money, not hard cash, and certainly not theirs!
✅ Is it legal for a merging credit union to look after its members by disbursing the capital reserves to existing members? See what you think...,
The Federal Credit Union Act PART 708b—MERGERS OF INSURED
CREDIT UNIONS § 708b.106:
(ii) A statement as to whether the
members of the merging credit union
will receive a share adjustment or
other distribution of reserves or undi-
vided earnings, including a summary of
reasons for the decision and, at the
merging credit union’s discretion, a
short explanation about the capital
level;
Believe we're still trying to abide by the law in this Country, aren't we?
😎 Should your CU Board tell you that they have decided to give away your ($$$) member equity - and why or why not?
