Credit Union Mergers Pros, Cons, Do’s and Don’ts

Credit Union Mergers Pros, Cons, Do's and Don'ts

Presented By:

Christopher J. Pippett, Esquire

National Association of Federal Credit Unions Webcast September 16, 2015

? 2015 Fox Rothschild

Credit Union Organizational Reporting/Supervision Chart

Supervisory Committee Internal Auditor

Members

Board of Directors

Board Committees

CEO/Manager

Senior Management

Department/Branch Managers

Rank and File Employees

General Powers & Duties of Credit Union Directors and Officers

?DUTY OF CARE ?DUTY OF LOYALTY ?DUTY OF OBEDIENCE TO THE LAW

All of these traditional legal duties apply to credit union directors and committee members.

General Powers & Duties (cont'd.)

? Duty of Care ? A director must stay informed and must exercise independent judgment.

? Duty of Loyalty ? "Best interests of the credit union".

? Duty of Obedience to the Law ? You have to follow the rules!

Duties Under NCUA Regulations

? Section 701.4 (b) of the regulations incorporated these duties into NCUA regulations as follows:

? Each Federal credit union director has the duty to:

? (1) Carry out his or her duties as a director in good faith, in a manner such director reasonably believes to be in the best interests of the membership of the Federal credit union, and with such care, including reasonable inquiry, as an ordinarily prudent person in a like position would use under similar circumstances;

? (2) Administer the affairs of the Federal credit union fairly and impartially and without discrimination in favor of or against any particular member;

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