SOUTH BURLINGTON, Vt. -- The Association of Vermont CreditUnions is the latest to adopt a resolution that supports providingprotections for credit unions as "hostile" takeover targets.

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The resolution says taking into consideration the best interestsof the members, a CU's board has the right to approve or disapprovea merger proposal. Third parties also have no right to interfere inthe business operations of a CU or hinder its ability to act in thebest interests of its members. Credit unions or other third partiescannot provide "inaccurate or misleading" communications to membersof another CU, the resolution reads.

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"Unsolicited attempts to affect unwanted mergers by encouragingill-considered decisions to declare dividends can raise serioussafety and soundness concerns, and the authority of one creditunion to spend funds to influence member votes at another creditunion should be subject to serious review by regulators," accordingto the resolution.

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AVCU has called on NCUA and the Vermont Department of Banking,Insurance

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Securities and Healthcare Administration to "reinforce creditunion principles of cooperation and reaffirm the strongest supportfor honored credit union values." Regulators should refrain fromapproving any merger application that has resulted from a hostileattempt to takeover, AVCU suggested.

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The Minnesota Credit Union Network previously adopted a similarresolution regarding unsolicited takeovers.

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