I was very pleased to see Mike Welch, in his Oct. 2 column "Bank credo: do as we say, not as we do" shed some light on the S-corporation topic which many in the industry and I would guess most credit union board members probably did not understand very well. There is another advantage to the S-Corp shareholders that the article didn't mention directly. Since the bank avoids paying taxes, everything else being equal, the bank enhances its book value by the amount of taxes saved. Since banks typically sell for around twice book value or more, the shareholder also increases the value of his stock investment, by approximately double the amount of tax savings, each year. An arcane point of finance. Martin Breland President/CEO Tower FCU Laurel, Md.

Complete your profile to continue reading and get FREE access to CUTimes.com, part of your ALM digital membership.

  • Critical CUTimes.com information including comprehensive product and service provider listings via the Marketplace Directory, CU Careers, resources from industry leaders, webcasts, and breaking news, analysis and more with our informative Newsletters.
  • Exclusive discounts on ALM and CU Times events.
  • Access to other award-winning ALM websites including Law.com and GlobeSt.com.
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.