Alabama's top regulator and the former CEO and board of thefailed $193 million Mutual Savings Credit Union of Birmingham havesettled their legal dispute although the CU remains under stateconservatorship.

In a brief statement issued last week, Dale Dalbey, the Mutualpresident who was ousted last July from the Birmingham CU alongwith seven directors by Administrator T. Glenn Latham over chargesof mismanagement, have agreed to settlement terms calling forDalbey and the board to be “reinvited” to their former jobs oncethe conservatorship is lifted.

The settlement caps a legal battle in a state court overcomplaints by Dalbey and the board that regulators actedarbitrarily and wrongly in placing Mutual under state control.Latham countered that the CU got into deep trouble on faultycommercial loans and was operating “in an unsafe condition” andboard members had “spent money wildly.”