League, Regulator Press NCUA on Constitution Corporate
The corporate focus and how the industry deals with service options as a result of the NCUA's restructuring turned mostly to Connecticut last week, with continued interest in the resolution of all five agency conserved corporates.
In one development, the Credit Union League of Connecticut joined by the state's banking commissioner, Howard Pitkin, pressed the NCUA to move ahead on settling its conservatorship of the $1.4 billion Constitution Corporate FCU and also complained that CUs in the state were being slighted in the restructuring dialogue.
NCUA had pledged in September to find a merger partner for Constitution Corporate of Wallingford, which is now under a NCUA-engineered purchase and assumption directive. But credit unions said they were left in the dark on the agency's intentions because there are no town hall meeting scheduled.
While dozens of NCUA discussion forums with CEOs across the U.S. have been held in states affected by the Sept. 24 corporate seizures, none have been held in Connecticut.
"I have asked NCUA to schedule some town halls as part of their outreach," Howard Pitkin, the state's top banking and credit union regulator, told Credit Union Times.
The Connecticut league said it agrees that town halls would be productive so CUs can understand "why the agency decided to do a p/a for Constitution and not a bridge," said Tony Emerson, the president/CEO of the league. On its own, the league has been holding separate review panels that allow CUs to share and discuss future servicing arrangements on item processing, funding and other functions, all routinely handled through Constitution.
The league, said Emerson, might get a better idea of the NCUA plans and perhaps a merger decision Nov. 23 when top NCUA officials are slated to meet in Hartford to discuss Constitution and its aftermath, said Emerson.
Although there have been no meetings in Connecticut, "we did send a busload of CEOs to Boston last month to hear Gigi Hyland," said Emerson, citing an NCUA forum conducted by the director.
For the record, John McKechnie, NCUA's director of congressional and public affairs, acknowledged that "no town hall has been scheduled" in Connecticut and that "upon determining a resolution for Constitution Corporate, NCUA will meet with members of and discuss the approved plan."
In the meantime, there was one Connecticut CEO, Daniel Daigle of the $1.5 billion Connecticut State Employees CU, who cautioned against speedy action on Constitution since that corporate "is at a disadvantage and is being penalized" compared to the other bridge corporates that have time to reorganize and prepare new models.
"Frankly, I'd be happy if this drags out six months or more so there is time to weigh additional options," said Daigle, who heads the state's largest CU and took part in league roundtable meetings held with Pitkin earlier this month.
If NCUA acts too quickly in finding a merger partner, he said, optimum solutions developed by trade organizations might be missed. "I think there is a danger in resolving this too quickly," he said.