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To date, much of the focus in the credit union-to-bank conversion debate appears to be defensive in nature, namely, the imposition of various regulatory and governance barriers. Scant attention has been paid to the offensive opportunities inherent in such conversions. There seems to be an almost inherent assumption in much of the discourse that the converting credit union will retain virtually all of its membership as “customers” in a post-conversion environment. However, what if the former membership was the focus of aggressive member acquisition efforts by other credit unions? After all, the field of membership of the converting institution is literally “up for grabs”. One can assume that some portion of the former credit union membership will undoubtedly feel “abandoned”, while another portion may be somewhat ambivalent regarding the loss of their credit union. Both portions would appear to be “opportunities” ripe for aggressive member acquisition efforts by other credit unions. If converting institutions were struggling from get-go to retain significant portions of their former membership base, while at the same time incurring additional marketing and other conversion related costs, conversions might well be slowed if not stopped in their tracks. In any event, many of the converting institution’s members would be offered an opportunity to remain CU members albeit at other credit unions. Good for members, good for credit unions. Moreover, aggressive acquisition efforts by other credit unions might well increase the costs and therefore the “risk factor” associated with conversion which ought to eventually be reflected in any IPO valuation equation and stock appreciation estimates. In the final analysis, then, competitive acquisition offense might prove to be the best conversion defense. Michael G. Clinton Director Emeritus Affinity FCU Basking Ridge, N.J.

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