NAFCU Presses FTC to Lift Premerger Notice
NAFCU is renewing its push with the Federal Trade Commission to give federal credit unions an exemption from premerger notification rules and accompanying fees under the Hart-Scott-Rodino Act.
In a letter sent June 28 to FTC Chairman Jon Leibowitz, Fred Becker, NAFCU president/CEO, urged the agency to grant the waiver because of current economic conditions impacting CUs as well as the fact that antitrust is not a likely issue between merging CUs.
Moreover, wrote Becker, "depository institutions that receive approval for mergers from the federal banking agencies can receive an exemption from the notification requirements."
The HSR Act requires CUs that conduct merger transactions, which exceed the statutory threshold, to file premerger notifications with the FTC and pay filing fees, which can run $48,000 to $280,000.
CUs have long complained that the filing and attorney fees are a deterrent to necessary mergers, particularly for those CUs under stress.
The extra fees are "cumbersome for credit unions because of their not-for-profit nature and prohibition against raising capital from sources other than retained earnings," said NAFCU.
"We believe unnecessary legal and regulatory obstacles that create disincentives to merge should be removed," wrote Becker.
CUNA said it too has been tracking the FTC premerger exemption problem and has also been pushing for waivers.
A NAFCU spokesman said it has had conversations "on and off with the FTC staff" on the issue for months, but the economic climate has given the exemption matter far more urgency.