December 14, 2005

FAX & Regular Mail

Anne Cochran, President/CEO

Louisiana Credit Union League

824 Elmwood Park Blvd., Suite 200

Harahan, LA 70123

Re: Flexibility in FCU Bylaws for Director and Member Meetings

Affected by Hurricane Katrina.

Dear Ms. Cochran:

You recently contacted NCUA seeking guidance for procedures for
conducting board meetings and member elections for federal credit unions
affected by Hurricane Katrina. The standard Federal Credit Union Bylaws
and existing Office of General Counsel opinions authorize most of the
flexibility you seek. We summarized the relevant bylaw provisions for
each topic of your inquiry below. For ease of reference, we have
included these provisions and opinions as an enclosure to this letter.

[Board meetings]{.underline}

The standard FCU bylaws require only one face-to-face board of directors
meeting per year. FCU Bylaws, Article VI, Section 5. All other meetings
may be conducted by video or teleconference. The one in-person meeting
requires the actual presence of only a quorum of directors, not every
director. Absent directors may participate by video or teleconference.
Further, credit union boards may act without a meeting, if the vote is
unanimous and each board member's position is documented in writing or
email. OGC Legal Opinion Letter 02-0837, dated Sept. 19, 2002.

We also note that the standard FCU bylaws permit directors to appoint
temporary directors and supervisory and credit committee members to
serve in place of those who may need to step aside. FCU Bylaws, Article
VI, Section 4.

[Notice of member meetings and elections]{.underline}

The credit union should follow its usual procedures and send information
about meetings and elections to the member's last address of record. The
FCU bylaws make members responsible for notifying the credit union of
address changes. FCU Bylaws, Article XVI, Section 7. Nevertheless, we
note that some of the addresses an FCU may have on record may no longer
exist because of hurricane

Anne Cochran

Page Two

December 14, 2005

damage, but members may have provided the U.S. Postal Service with
forwarding instructions.

We also note that Article V of the standard FCU bylaws allows four
options for conducting elections. If a credit union's board or
management feels that a different option would be more convenient, they
may amend the credit union's bylaws with the vote of two-thirds of the
directors. FCU Bylaws, Article XVII, Section 7.

An FCU may also want to consider delaying its annual member meeting for
a few months. While an FCU is required to conduct an annual meeting and
hold elections under Article IV, the directors may determine that
changing the date will be helpful for a number of reasons; there is
nothing to prohibit a change in the date of the annual meeting in the
FCU Act or FCU Bylaws.

[Proxy voting]{.underline}

You also inquired about options for proxy voting. The FCU bylaws
prohibit proxy voting. FCU Bylaws, Article V, Section 4. In any event,
since voting by proxy would still require an FCU to contact the member
and receiving the member's written proxy, proxy voting would not save
any time or effort as a practical matter as far as contacting members.
As discussed above, credit union boards may act without a meeting as
long as all directors vote and the vote is unanimous and in writing,
which may also be by email.

Region IV Acting Director Keith Morton has communicated to you that NCUA
stands ready to assist credit unions recovering from the hurricanes. You
are welcome to contact our Region IV office or the Office of General
Counsel for additional information.

> Sincerely,
>
> /s/
>
> Sheila A. Albin
>
> Associate General Counsel

OGC/EAW:bhs

05-1216/Enclosures

cc: Keith Morton, Acting Director, Region IV

Jane Walters, Deputy Executive Director

**Article VI, Section 5 of the FCU Bylaws**

A regular meeting of the board must be held each month at the time and
place fixed by resolution of the board. One regular meeting each
calendar year must be conducted in person. If a quorum is present in
person for the annual in person meeting, the remaining board members may
participate using audio or video teleconference methods. The other
regular meetings may be conducted using audio or video teleconference
methods. The chair, or in the chair's absence the ranking vice chair,
may call a special meeting for the board at any time and must do so upon
written request of a majority of the directors then holding office.
Unless the board prescribes otherwise, the chair, or in the chair's
absence the ranking vice chair, will fix the time and place of special
meetings. Notice of all meetings will be given in such manner as the
board may from time to time by resolution prescribe. Special meetings
may be conducted using audio or video teleconference methods.

**Article VI, Section 4 of the FCU Bylaws**

Any vacancy on the board, credit committee, if applicable, or
supervisory committee will be filled within a reasonable by a vote of a
majority of the directors then holding office. Directors and credit
committee members so appointed will hold office only until the next
annual meeting, at which any unexpired terms will be filled by vote of
the members, and until the qualification of their successors. Members of
the supervisory committee co appointed will hold office until the first
regular meeting of the board following the next annual meeting of
members, at which the regular term expires, and until the appointment
and qualification of their successors.

**Article XVI, Section 7 of the FCU Bylaws**

Members must keep the credit union informed of their current address.

**Article V, Section 4 of the FCU Bylaws**

Members cannot vote by proxy, but a member other than a natural person
may vote through an agent designated in writing for the purpose. A
trustee, or other person acting in a representative capacity, is not, as
such, entitled to vote.

\[Note that the language prohibiting trustee voting has been deleted in
the proposed bylaw revisions issued for comment July 15, 2005, but the
prohibition on proxy voting will remain.\]

**Article XVII, Section 1 of the FCU Bylaws**

Amendments of these bylaws may be adopted and amendments of the charter
requested by the affirmative vote of two-thirds of the authorized number
of members of the board at any duly held meeting of the board if the
members of the board have bee given prior written notice of the meeting
and the notice has contained a copy of the proposed amendment or
amendments. No amendment of these bylaws or of the charter may become
effective, however, until approved in writing by the NCUA Board.

\[Note: if a credit union is switching election procedure and is using
one of the options provided in the form bylaws with no changes, NCUA's
written approval would not be required.\]