Former CU Buying Back Shares

Credit Union Times   November 26, 2007
By David Morrison

PLANO, Texas — Shareholders of the $1.6 billion Viewpoint Bank, formerly Community Credit Union, will likely find more to smile about this time of year as the bank has announced that it will repurchase up to just over $580,000 shares of the former CU’s stock at prevailing market prices over the next year.

Bank shareholders, including former CU executives and directors, benefit from such buy back programs because they reduce the number of total shares outstanding and thereby hike the value of the remaining shares.

Gary Base, former Community CEO and now CEO of Viewpoint said, "We believe that the repurchase of our shares represents an attractive investment opportunity which will benefit the Company and our shareholders" in a statement about the buyback program.

Analysts and academics have occasionally criticized such programs, particularly in thrifts, suggesting that repurchase program initiated fairly quickly after a stock conversion indicates that the company may have been overvalued in its initial offering.

© 2007, Used with permission from The Credit Union Times. All rights reserved.