Nebraska holds hearing on CU bills

Nebraska is considering a pair of bills which would affect its state-chartered credit unions, one affecting field-of-membership expansion.

LB 453 would change requirements around notices of credit unions to expand their fields of membership. Under the new law, state-chartered credit unions would be required to provide notice to the Nebraska Bankers Association and the Nebraska Independent Community Bankers when making application to amend their bylaws or articles of association to expand their field of membership.

If the director receives any substantive objection to such an expansion, a hearing would be held on the matter.

Under current law, when a credit union applies to the Nebraska Department of Banking to amend its bylaws to expand its field of membership, the director is only required to publish notice in a  newspaper of general circulation in the county or counties in which the expansion is being sought.

The mere filing of published notice does not provide sufficient notice for interested parties to challenge the expanded field of membership, if warranted, the NBA said.

The bill was introduced by Sen. Rob Clements, a banker from Elmwood, and Sen. John Stinner, a former banker from Gering.

LB 407 would allow well-capitalized Nebraska-chartered credit unions the same activities as out-of-state credit unions which have one or more branches in Nebraska. The credit union must have the approval of the Director of the Nebraska Department of Banking and Finance.

To meet requirements, the director must find that “the exercise of the power and authority serves the convenience and advantage of the members of the credit union.”

The director also must find that it maintains the fairness of competition and parity between credit unions chartered under the Credit Union Act and credit unions chartered by any other state which operate one or more branches in this state.

The bill was introduced by Sen. Brett Lindstrom of Omaha.

A hearing on the bills was slated for Feb. 26 before the Banking, Insurance, and Commerce Committee.