Second Largest MA Credit Union Announces Bank Conversion Plan

Last week the second largest Massachusetts credit union announced to members that its board of directors is considering a conversion to a mutual co-operative bank. The reasons for the conversion that the credit union mentioned include the elimination of geographic restrictions, increased lending authority and access to additional capital.

For credit union-to-bank conversions, it appears typical for a credit union convert into a mutual co-operative bank. A mutual co-operative bank is owned by and operated for the benefit of its depositors in a manner similar to the way a credit union is owned by and operated for the benefit of its members. This often is just a temporary state. Banks will then often convert into a stock-issuing bank. It would be interesting to see how much the top management profit from these conversions.

There's more on this conversion announcement at the Credit Union Times.