SALT LAKE CITY – Against a backdrop of legal maneuvering in preparation for the first court hearing on the American Bankers Association suit against NCUA's field of membership policies, two more Utah state-chartered credit unions have confirmed plans to switch to a federal charter. They are the $115 million Utah Central Credit Union of Salt Lake City and the $45 million Carbon CU of Price. "Utah's restrictions on business lending are a primary motivation for us in deciding to convert," explained Brett Blackburn, president/CEO of Utah Central, which hopes to have its new federal charter by October. Long outspoken about the state's anti-CU climate and issuing a fresh call for industry-wide action against the banking lobby, Mike Milovich, president of Carbon CU and vice chairman of the Utah League of Credit Unions, said his CU filed its federal charter application Aug. 5 with NCUA's Concord, Calif. regional office. It is the regional office's approval of three FOM expansion bids-Tooele Federal CU, America First Federal CU and Goldenwest Federal CU-that is the subject of the now celebrated ABA/Utah Bankers Association suit against NCUA seeking to overturn the agency's April/May approvals of multi-county branching for the three CUs. Two of the three-America First and Goldenwest-converted to federal charters May 1 following the tax fight in the Utah legislature last spring. The ABA suit, joined in by four Utah banks and brought in a federal district court here July 15, is due for an initial hearing before Judge Thomas Greene late next month. CUNA and NAFCU said they plan to file briefs as intervenors on the side of NCUA while the Utah League's Board of Directors at a meeting July 30 agreed for the League to also join as an intervenor "if needed." Also pledging to file intervenor petitions-again if necessary-are the three CUs named in the ABA suit. Lawyers here said Judge Greene may disallow the intervenor petitions "deciding he has enough information already," as one Salt Lake attorney put it. Meanwhile, Milovich called on the credit union industry to assume a more aggressive stance in fighting the banking lobby and suggested CUs in Utah and elsewhere go on the counterattack with lawsuits charging the ABA or banks with "restraint of trade." "I am so tired of standing in the corner and getting beat up on, and so I think we need to turn this thing around and start suing individual banks," said Milovich adding he had no specific strategy or institutions in mind. Yet, he said, "nationwide we have to stop these frivolous suits that the bankers keep bringing against us," maintaining they are "everywhere and in many states." "They go after us on logos and on anything they think of and it's high time we take off the white hat because sometimes you have to stand up and fight the bully," declared Milovich, who before taking a CU job was a commercial bank officer in Price with Zions Bank and First Security, a dominant Utah bank until it merged with Wells Fargo. Milovich, a Democrat and also a Carbon County commissioner, has been described by fellow League members as probably "more politically attuned than most of us, but the federal charter will be a good thing for him," as one put it. Regarding the planned conversion, Milovich said his institution, with a membership of 8,900 in a mining community 120 miles south of Salt Lake, has long been reluctant to leave the state system, but the anti-CU environment in Utah made it essential to take advantage of the federal charter. The chairman of the Utah League, Steven Christensen, who also is president of Tooele Federal CU, said he sympathized with Milovich's view lamenting, however, that the fallout from the ABA suit, the CU counterattack and the tax fight represented a tragedy in that so much other pressing financial business is left by the wayside. "Banks and credit unions should be working together to address the most pressing issue: bankruptcies in Utah and what to do about them but instead thousands are being spend on advertising," said Christensen. "It's really sad that those funds should be spent on areas where they are needed." At the same time, Christensen said he also found it distressing for his institution to be constantly defending itself in the Salt Lake City media following unrelenting banker attacks. In receiving NCUA approval for its six-county FOM expansion, Christensen said Tooele Federal acted lawfully in applying and receiving permission to expand "just as any bank would do when it crosses state lines." "There is nothing illegal or sneaky about what we did," he said and yet the banking lobby has tried to paint a negative picture. "We acted openly and we acted in accordance with the law-just as banks have done with their regulator." -


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