BOSTON–A bill in the Massachusetts legislature would allow state chartered banks to convert to a credit union charter or merge into a credit union. Such a change might pave the way for credit unions to acquire banks in the state.
The reverse has been permitted for some time in the state, with SCUs permitted to convert to bank charters or to merge into banks.
The new legislation, “An act relative to mergers of credit unions and banks, and charter conversions of insured depository institutions,” includes language similar to a provision in the credit union modernization bill, which is in its second year of hearings, according to Banker & Tradesman.
“While MBA is not opposed to the concept of a two-way street that would allow a bank to convert to a credit union, we believe the committee should carefully examine the public policy implications of these measures,” the Massachusetts Bankers Association said in a statement. “We also believe that the Federal Deposit Insurance Corporation, the National Credit Union Administration and the state excess insurance funds may need to provide input into the transaction.”
According to Banker & Tradesman, the state’s Committee on Joint Financial Services will make recommendations in February on most of the bills under their jurisdiction, and whether or not they support them or if they believe they require further study.