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News Now

CU System
Comments due today from HarborOne members on conversion
BROCKTON, Mass. (3/15/12)--Today is the deadline for members of HarborOne CU, Brockton, Mass., to weigh in on the credit union's plan to convert to a savings bank. Members must have their comments in by the end of the day, according to the credit union's website.

Directors of the nearly $1.9 billion asset credit union announced  Feb. 16 that they were considering a possible charter conversion to a Massachusetts-chartered mutual cooperative bank.  On Wednesday, after reviewing members' comments, the board of directors will consider adopting the plan.

The Credit Union National Association (CUNA) and the Massachusetts Credit Union League maintain that the credit union charter is the best option for members of a credit union and that any decision should ultimately be in the interests of the members  (News Now Feb. 17).

HarborOne, in a notice on its website, said converting  to a bank would provide  more flexibility to expand its customer base; increase lending authority, particularly in business lending; and provide access to additional capital such as sale of stock, not currently available to credit unions.

It noted members would become depositors who would retain the same voting rights under its one-member, one-vote principle; the institution would not change fees or rates; directors would be compensated instead of volunteering; and it would pay federal and state income tax.

If the board decides Wednesday to pursue a conversion, it will file materials with the regulators for a review of conversion-related materials to be sent to members about the conversion plans.  HarborOne cautioned members they would not receive materials until after the regulatory review, which can take months.  After the review, the conversion proposal will be submitted to the membership for a vote after a notice period of at least 90 days.


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