On a 15-0 vote of the Virginia Senate Commerce and Labor Committee, the now recast bankers' bill enabling state chartered credit unions to convert to mutual status cleared another hurdle this week as it appears headed for passage.
In its original form, opposed by the Virginia Credit Union League, the bill would have allowed banks to buy and merge credit unions.
The compromise measure, worked out in meetings between the Virginia League and the Virginia Bankers Association, was adopted late Monday as lawmakers hurried home to avoid another winter blast and record snowfalls.
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Sen. Richard Saslaw (D-35), the Senate majority leader and the bill's patron, told the panel that the bill before them was a substitute that would give CU members "ample opportunity" to comment on a conversion plan and for them to receive notice of the proposal to change their credit union to a mutual savings bank.
He noted that after a CU's board approves conversion, then two-thirds of members voting are needed to support conversion. The State Corporation Commission also has to approve the conversion, retaining the right to deny the change if safety and soundness issues are present.
Unlike the House panel consideration, the Senate proposal sparked questions, mostly centered around the impact of a CU to mutual savings bank conversion.
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