ALEXANDRIA, Va.–When credit unions merge, their respective net worth levels seem to play little role in deciding whether to pay out some of that capital to members as a result of the combination.
That’s one of the findings from a CUToday.info review of the last four months of disclosure forms filed with NCUA by credit unions that are merging. Even in some cases where capital was north of 40%, a CU did not make any distribution to members. In other cases, CUs with considerably less capital made payouts, using formulas that ranged from the traditional formula, a percentage of the amount of money on deposit or in loan balances, while in other cases credit unions made payouts based on how long the member had belonged to the credit union.
It should be noted that many of the CUs with high capital are/were smaller in assets and termination fees for various products may take/have taken a disproportionate amount of the capital.
In part I of this two-part series, CUToday.info featured credit unions that had made payouts to management and/or board members as a result of the merger. In this article, CUToday.info looks at CUs that did not make any payout to management/boards members.
The information was gleaned from disclosure forms filed by federally insured credit unions. Credit unions merging out of existence, nearly all of them smaller, shared reasons for merging that included inability to invest in technology (even though some had very high capital levels), inability to find volunteers and staff and, a common theme, a lack of any succession planning and a retiring CEO, as revealed below.
Two other notes:
- The financials quoted below are based on the most recent 5300 filed with NCUA.
- In some cases members have yet to vote on the merger proposal. In those cases the date of the member vote is listed below.
Credit Union Mergers
Fieldale Credit Union & North Main Credit Union
Merging Credit Union: Fieldale Credit Union
Assets: $9.97 million
Members: 1,602
Net Income: $2,424
Net Worth: 13.43%
Reason for Merger: Fieldale said it “would not have sufficient resources to expand offerings and operate independently.” It cited the additional offerings available through North Main CU. Indicative of its asset size, Fieldale lacks a website.
Continuing Credit Union: Main Credit Union
Assets: $20.24 million
Members 1,692
A vote by members of Fieldale Credit Union is scheduled for Jan. 13.
Lincoln Maine FCU & EastMill FCU
Merging Credit Union: Lincoln Maine CU
Assets: $96 million
Members: 6,000
Net Income: $1.055 million
Net Worth: 11.31%
Reason for Merger: In its statement to members, Lincoln Maine said the reasons for the merger are economies of scale, opportunities to increase services and lower service delivery costs, an increase in the number of available service locations comma and an increase in management efficiencies an operations period.
Merger-Related Net Worth Distribution: None
Merger-Related Board/Management Compensation: None
Continuing Credit Union: EastMill FCU
Assets: $72.3 Million
Members: 4,000
Shambhala Credit Union & Premier Members Credit Union
Merging Credit Union: Shambhala Credit Union
Assets: $2.1 Million
Members: 314
Net Income: ($6,132)
Net Worth: 9.22%
Reason for Merger: Shambhala CU said it is seeking to merge to provide its members with an expanded branch network as well as expanded product/service offerings, including online and mobile banking.
Merger-Related Net Worth Distribution: None’
Merger-Related Board/Management Compensation: None
Continuing Credit Union: Premier Members Credit Union
Assets: $1.54 billion
Members: 77,000
Western Heritage FCU & Meridian Trust FCU
Merging Credit Union: Western Heritage FCU, Alliance, Neb.
Assets: $65.5 million
Members: 8,753
Net Income: $127,676
Net Worth: 8.80%
Continuing Credit Union: Meridian Trust FCU, Cheyenne, Wyo.
Assets: $569.7 million
Members: 31,640
Reasons for Merger: “The merger is in the best interests of members because western heritage has a passion to serve their existing and potential membership with local and digital service, centralized non-revenue-generating responsibilities, develop (sic) current staffing and have additional mortgage and business products,” Western Heritage FCU said in its disclosure.
Merger-Related Net Worth Distribution: None
Merger-Related Compensation to Board/Management: None
Date of Member Vote: Dec. 15, 2021
G.H.S. FCU & South Carolina FCU
Merging Credit Union: G.H.S. FCU, Greenville, S.C.
Assets: $55.2 million
Members: 11,254
Net Income: $17,535
Net Worth: 8.55
Continuing Credit Union: South Carolina FCU, North Charleston, S.C.
Assets: $2.34 billion
Members: 169,394
Reason for Merger: “The merger is in the best interests of members because it will increase efficiency and operations of scale, provide greater access to branches and ATMs, while providing the membership with a wider array of products and services,” G.H.S. FCU said.
Merger-Related Net Worth Distribution: None. G.H.S. FCU said there would be no distribution...because the “probable asset to share ratio (the relative value of $1 of shares in the credit union) is the same at both credit unions.”
Merger-Related Board/Management Compensation: None indicated
Date of Member Vote: Dec. 8, 2021
Tenn-Am Water Co. FCU & EPB Employees CU
Merging Credit Union: Tenn-Am Water Company FCU, Chattanooga, Tenn.
Assets: $2.6 million
Net Income: ($4,912)
Net Worth: 30.92%
Continuing Credit Union: EBP Employees
Assets: $38 million
Net income: $53,795
Net worth: 8.18%
Member vote: Nov. 30
Reason for Merger: Tenn-Am Water FCU said, “The board of directors has concluded that it's in the best interest of our members to join with another credit union to combine resources to better serve you…Through the merger members will have expanded financial products and services comma greater member benefits comma and advanced electronics services”
Merger-Related Net Worth Distribution: None. “The board of directors has determined a share adjustment, or other distribution of Tenn-Am Water FCU’s net worth, is unnecessary because Tenn-Am Water FCU’s members stand to benefit from the increased products and services offered by EPB Employees CU,” the CU stated in its disclosure form.
Merger-Related Board/Management Compensation: None indicated.
Boys Town FCU & Cobalt FCU
Merging Credit Union: Boys Town FCU, Boys Town, Neb.
Assets: $3.4 million
Members: 1,038
Net Income: ($23,950)
Net Worth: 6.92%
Continuing Credit Union: Cobalt FCU, Papillion, Neb.
Assets: $1.107 billion
Members: 108,282
Net Income: $4.025 million
Net Worth: 9.09%
Reason for Merger: “The board of directors has concluded that the proposed merger is desirable and in the best interests of members because the merger will provide members with access to additional products and services, a larger network of physical locations and additional online and mobile banking options,” Boys Town FCU said. “For a number of reasons, including the increased cost of operating a credit union in today's environment, the board of directors determined in 2020 that the operations of Boys Town Federal Credit Union as a separate, standalone credit union should be discontinued and wound down.
Merger-Related Capital Distribution: None
Merger-Related Board/Management Compensation: None indicated
Member Vote: Nov. 29, 2021
Patterson Pump FCU & North Georgia CU
Merging Credit Union: Patterson Pump FCU, Toccoa, Ga.
Assets: $2.484 million
Members: 376
Continuing Credit Union: North Georgia, Toccoa, Ga.
Assets: $80.9 million
Members: 10,989
Reason for Merger: “The board of directors has concluded that the proposed merger is desirable and in the best interest of members because corporate sponsorship of the credit union will be ending and the credit union does not have sufficient resources to operate independently.
Merger-Related Net Worth Distribution: Patterson Pump Federal Credit Union said it will distribute a portion of its net worth to its members in the merger. “The board has determined to distribute a portion of Patterson pump federal credit union's net worth as follows: a special dividend of 7.50% of share balances as of June 30 2021 will be paid to members on Dec. 31st 2021.”
Merger-Related Board/Management Compensation
- Manager Mary Weaver will receive a payout of $38,000
Artmet CU & RTN FCU
Merging Credit Union: Artmet Credit Union, Stoughton, Mass.
Assets: $343,075
Members: 54
Net Income: ($16,719)
Net Worth: 12.34%
Continuing Credit Union: RTN FCU, Waltham, Mass.
Assets: $1.058 billion
Members: 42,641
Merger-Related Net Worth Distribution: Artmet CU said no distribution will be made, stating that RTN’s minimum membership share is $25, compared to $100 at Artmet.
Merger-Related Board/Management Compensation: None indicated.
Member Vote: Nov. 17, 2021
White Gold CU & Pelican State CU
Merging Credit Union: White Gold Credit Union, Raceland, La.
Assets: $439,847
Members: 170
Net Income: $918
Net Worth: 28.51%
Continuing Credit Union: Pelican State Credit Union, Baton Rouge, La.
Assets: $589.8 million
Members: 68,454
Reason for Merger: “The credit union's board of directors and management have concluded that given the credit union size, it does not have the resources or produce enough income to cover the expenses of hiring staff to meet all compliance and regulatory requirements.”
Merger-Related Net Worth Distribution: None
Merger-Related Board/Management Compensation: None indicated
The New Horizons CU & Triangle FCU
Merging Credit Union: The New Horizons CU, West Point, Miss.
Assets: $13.8 million
Members: 2,638
Net Income: $61,886
Net Worth: 14.79%
Continuing Credit Union: Triangle FCU, Columbus, Miss.
Assets: $107.9 million
Members: 12,239
Merger-Related Net Worth Distribution: The New Horizons Credit Union said a portion of its net worth would be distributed to members, although its disclosure statement did not identify a specific amount or formula.
Merger-Related Board/Management Compensation: None indicated
Town of Palm Beach CU & Guardians CU
Merging Credit Union: Town of Palm Beach Federal Credit Union, West Palm Beach, Fl.
Assets: $2.54 million
Members: 363
Net Income: $19,025)
Net Worth: 8.42%
Continuing Credit Union: Guardians Credit Union, West Palm Beach, Fla.
Assets: $289.6 million
Members: 36,620
Reasons for Merger: In its disclosure, Town of Palm Beach CU cited access to additional branches, longer hours, virtual services and the ability to retain its branding and operate as a “division of Guardians Credit Union.”
Merger-Related Net Worth Distribution: None
Merger-Related Board/Management Compensation: None indicated
Gloucester Fire Dept. CU & Metro CU
Merging Credit Union: Gloucester Fire Department Credit Union, Gloucester, Mass.
Assets: $662,551
Members: 93
Net Income: ($4,562)
Net Worth: 31.34%
Continuing Credit Union: Metro CU, Chelsea, Mass.
Assets: $2.464 billion
Members: 191,611
Reasons for Merger: Gloucester CU said in its statement additional products, services, branches and mobile banking made the merger desirable.
Merger-Related Net Worth Distribution: The credit union said it would not be distributing any capital, because of costs and expenses associated with the merger, such as termination of vendor contracts.”
Merger-Related Board/Management Compensation: None indicated
Elm River CU & First Community CU
Merging Credit Union: Elm River CU, Kindred, N.D.
Assets: $32.4 million
Members: 1,388
Net Income: $298,786
Net Worth: 14.54%
Continuing Credit Union: First Community CU, Jamestown, N.D.
Assets: $1.037 billion
Members: 45,424
Reasons for Merger: “The board of directors header has concluded that the merger is to desirable and in the best interests of members because our CEO of 32 years is retiring at the end of the year. We have considered merging for the past couple of years, and researched other credit unions to see who would be a good fit for our rural agricultural credit union we know we need to grow in order to offer all the services our members are asking for these days. So, rather than hire A new CEO, we want to make sure our two locations survive for a long time. By merging, our operation will save on many fees… All other employees will remain the same at both branches. Especially in small towns, members like to deal with staff that they are familiar and comfortable with and we feel this will be the best transition for Elm River credit union.”
Merger-Related Net Worth Distribution: None
Merger-Related Board/Management Compensation: None
Dor-Wic CU & Tidemark FCU
Merging Credit Union: Dor-Wic Credit Union, Salisbury, Md.
Assets: $10.2 million
Members: 1,197
Net Income: ($369,875)
Net Worth: 15.65%
Continuing Credit Union: Tidemark FCU, Seaford, Del.
Assets: $418.4 million
Members: 17,061
Reasons for Merger: In addition to citing ability to offer expanded products and services, the credit union said, “the complexity of running a financial institution has, in the opinion of the board of directors, made it very difficult for a credit union of our size to go forward.”
Merger-Related Net Worth Distribution: Dor-Wic FCU said it distributed a dividend in the amount of 6% to members at year-end 2020. In addition, any amount above Tidemark’s capital ratio will be distributed to members within 30 days of the merger.
Merger-Related Management/Board Compensation: None
McNeese FCU & Calcasieu Teachers & Employees CU
Merging Credit Union: McNeese FCU, Lake Charles, La.
Assets: $18.6 million
Members: 1,198
Net Income: $7,286
Net Worth: 11.88%
Continuing Credit Union: Calcasieu Teachers & Employees, Lake Charles, La.
Assets: $47.8 million
Members: 4,273
Reasons for Merger: McNeese FCU CU cited increased products, services and branches as reason for merger.
Merger-Related Capital Distribution: None
Merger-Related Board/Management Compensation: None
Telbec FCU & Bayer Heritage CU
Merging Credit Union: Telbec FCU, Beckley, W.V.
Assets: $13.2 million
Members: 1,362
Net Income: $4,677
Net Worth: 6.68%
Continuing Credit Union: Bayer Heritage CU, Proctor, W.V.
Assets: $608 million
Members: 35,936
Reasons for Merger: The credit union said that with “a limited three person staff and three remaining board members, it is difficult for six individuals to maintain operations. The credit union also cited declining lending and the need for help in “acclimating to current resources and dynamics to retain current membership and focus on potential member growth. Focusing on day-to-day operations, staff are limited in learning and development.”
Telbec said it also lacked a succession plan.
Merger-Related Net Worth Distribution: None
Merger-Related Board/Management Compensation: None indicated.
NAPFE FCU & US Postal Service CU
Merging Credit Union: NAPFE FCU, Washington, D.C.
Assets: $2.556 million
Members: 475
Net Income: ($19,474)
Net Worth: 40.14%
Continuing Credit Union: US Postal Service, Clinton, Md.
Assets: $275.6 million
Members: 25,506
Reasons for Merger: NAPFE FCU cited “economic challenges and a declining membership base,” as well as challenges in remaining competitive and dealing with compliance issues, for the need to merge. It said U.S. Postal Service FCU will be able to provide expanded products, services, technology and more.
Merger-Related Net Worth Distribution: Share adjustment or distribution: Despite the 40.14% net worth, the credit union said it “will not distribute a portion of its net worth to its members in the merger “because of broader services in the loan, share and convenience line and what have in recent years been lower loan rates and higher dividend rates at the continuing credit union and a recognition of these factors by both boards led to no recommended adjustment in shares,” the credit union stated in its disclosure form.
Merger-Related Board/Management Compensation: None indicated.
First Choice CU & Illinois State CU
Merging Credit Union: First Choice CU, Ottawa, Ill.
Assets: $13.5 million
Members: 1,515
Net Income: ($13,466)
Net Worth: 9.26%
Continuing Credit Union: Illinois State Credit Union, Normal, Ill.
Assets: $176.9 million
Members: 14,408
Reasons for Merger: First Choice CU said “the operating budget and resources for a small credit union can hinder the ability to provide the latest technology and a full range of products and services that our members both desire and deserve. With the approaching retirement of our president and CEO, Illinois State credit union will ensure a smooth transition and continuity of servicing our members.”
Merger-Related Net Worth Distribution: First Choice noted the par value of ISCU shares is $5, while the par value of FCCU is $20, and as a result each FCCU member “will have five shares for every $20 on deposit.”
Merger-Related Board/Management Compensation: None indicated.
Northland Community CU & CSD CU
Merging Credit Union: Northland Community, Gladstone, Mo.
Assets: $12.1 million
Members: 1,514
Net Income: ($16,328)
Net Worth: 10.86%
Continuing Credit Union: CSD Credit Union, Kansas City, Mo.
Assets: $57.5 million
Members: 5,21
Reasons for Merger: NCCU cited improved products, services and locations for the merger.
Merger-Related Net Worth Distribution: None
Merger-Related Board/Management Compensation: None indicated
Midland Co-op CU & SPIRE CU
Merging Credit Union: Midland Co-op CU, Minneapolis
Assets: $10.8 million
Members: 1,316
Net Income: $62,502
Net Worth: 8.88%
Continuing Credit Union: SPIRE Credit Union, Falcon Heights, Minn.
Assets: $1.773 billion
Members: 137,560
Reasons for Merger: “The board of directors has concluded that the proposed merger is desirable and in the best interests of our members because it provides our members with more products, services, and locations. Our values align with SPIRE credit union values.
Merger-Related Net Worth Distribution: Midland Co-op said it would make a distribution of its net worth prior to the merger “based on how long they have been contributing to the success of Midland Co-op Credit Union. Eligible members are individuals who have been a member for at least two full years…The calculation for each member will be their number of full years of membership divided by the sum of the membership years of all eligible members multiplied by $134,900. But calculations will be rounded to the nearest dollar and the maximum distribution will be $250 per member.”
Merger-Related Board/Management Compensation: None indicated.
McKesson Employees FCU & Western Healthcare FCU
Merging Credit Union: McKesson Employees FCU, Walnut Creek, Calif.
Assets: $29.3 million
Members: 4,701
Net Income: $29,908
Net Worth: 7.82%
Continuing Credit Union: Western Healthcare FCU, Martinez, Calif.
Assets: $46.8 million
Members: 3,095
Reasons for Merger: “The sponsor has left the state, causing the credit union to seek new arrangements, coupled with the concurrent employee of the CEO by both credit unions. This merger will create efficiencies that will improve performance and profitability while enhancing quality of service to members.
Merger-Related Net Worth Distribution: None
Merger-Related Board/Management Compensation: None indicated
PATA FCU & Alleg-Kiski Postal FCU
Merging Credit Union: PATA FCU, Pittsburgh
Assets: $3.2 million
Members: 958
Net Income: $5,087
Net Worth: 7.41%
Continuing Credit Union: Alleg-Kiski Postal FCU, New Kensington, Penn.
Assets: $19.1 million
Members: 2,316
Reasons for Merger: “The board of directors has concluded that the proposed merger is desirable and in the best interests of members because we will be able to offer the members an array of new and expanded services.”
Merger-Related Net Worth Distribution: None
Merger-Related Board/Management Compensation: None indicated.
Flowers Employees Credit League & Envision CU
Merging Credit Union: Flowers Employees Credit League CU, Thomasville, Ga.
Assets: $25.8 million
Members: 5,094
Net Income: ($142,225)
Net Worth: 27.29%
Continuing Credit Union: Envision CU, Tallahassee, Fla.
Assets: $778.1 million
Members: 57,367
Reasons for Merger: “…Additional economies of scale that will increase financial strength and stability, offer enhanced product and service lines to all members and offer additional branch locations to all members.”
Merger-Related Net Worth Distribution: “Flowers Employees Credit League will declare a special merger cash dividend for the FECL members in the total aggregate amount of 50% of total net worth as of the last quarter's end prior to the mergers effective date. This special merger cash dividend will be calculated as follows: $5 fixed dividend to each member in good standing and a pro rata distribution of the remainder of the special merger cash dividend divided among the members in good standing based on each member's average aggregate loan and deposit balances through June 30, 2020.”
Merger-Related Board/Management Compensation: None indicated.
Romeoville Community CU & Canals & Trails CU
Merging Credit Union: Romeoville Community CU, Romeoville, Ill.
Assets: $5.2 million
Members: 483
Net Income: ($68,540)
Net Worth: 5.57%
Continuing Credit Union: Canals & Trails, Lockport, Ill.
Assets: $31.3 million
Members: 2,960
Reasons for Merger: “After careful consideration, the board of Romeoville Community Credit union determined the best way to provide our members with the very best in service and the financial products they deserve was to partner with a like-minded credit union. Canals & Trails credit union possesses the resources and technological advances to offer our members immediate access to a vast array of product and financial Wellness tools.”
Merger-Related Net Worth Distribution: None
Merger-Related Board/Management Compensation: None indicated.
KASE FCU & Pheple FCU
Merging Credit Union: KASE FCU, Vandergrift, Penn.
Assets: $953,362
Members: 194
Net Income: ($13,837(
Net Worth: 11.38%
Continuing Credit Union: Pheple FCU, Greensburg, Penn.
Assets: $107.5 million
Members: 16,053
Reasons for Merger: “The products and services offered by Pheple FCU. The various means of accessibility that include branch locations, ATM network, shared branches, and digital solutions.”
Merger-Related Net Worth Distribution: KASE FCU paid a 2.50% bonus dividend to members.
Merger-Related Board/Management Compensation: None indicated.
Utilities CU & Royal CU
Merging Credit Union: Utilities CU, Eau Claire, Wis.
Assets: $6.84 million
Members: 899
Net Income: $389
Net Worth: 13.74%
Continuing Credit Union: Royal CU, Eau Claire, Wis.
Assets: $3.76 billion
Members: 241,372
Reasons for Merger: “The board of directors has concluded that the proposed merger is desirable and in the best interest of members because merging with Royal Credit Union provides more convenience, access, and product selection to our members. Royal is very involved in the community and has a long-term, viable strategy. In addition, Royal offers an employer partnership program, offering benefits that may resonate with all Xcel Energy employees. Further, it is becoming more difficult to remain compliant and to keep up with changes in technology.”
Merger-Related Net Worth Distribution: Utilities CU said it distributed a portion of its net worth over that of Royal’s 9.02% in merged assets after UCU pays data-extract conversion and early termination fees to AMI Information Systems. In total, it distributed $356,144.
Merger-Related Board/Management Compensation: None indicated.
All Souls FCU & Rockland Employees FCU
Merging Credit Union: All Souls FCU, New York
Assets: $86,153
Members: 99
Net Income: ($2,588)
Net Worth: 21.71%
Continuing Credit Union: Rockland Employees FCU, Spring Valley, N.Y.
Assets: $49 million
Members: 6,461
Reasons for Merger: “The board of directors has concluded that the proposed merger is desirable and in the best interests of members because of the following reasons: to preserve remaining capital, to expand services to members, and to expand field of membership.”
Merger-Related Net Worth Distribution: None
Merger-Related Board/Management Compensation: None indicated.
Holston Methodist CU & Interfaith FCU
Merging Credit Union: Holston Methodist FCU, Knoxville, Tenn.
Assets: $16.2 million
Members: 1,934
Net Income: ($99,085)
Net Worth: 5.78%
Continuing Credit Union: Interfaith FCU, Montclair, Calif.
Assets: $110.8 million
Members: 5,890
Reasons for Merger: “Through this partnership, while back office functions are consolidated, efficiencies are gained and cost savings realized, the things that touch our members, office location, staff and service availability will not change. The new credit union would seek to be the same credit union that members have come to know and trust... Much like our church and ministries, we are stronger working together than apart.”
Merger-Related Net Worth Distribution: None
Merger-Related Board/Management Compensation: None indicated.
Tin Mill Employees CU & First Choice America Community CU
Merging Credit Union: Tin Mill Employees, Weirton, W.V.
Assets: $20.3 million
Members: 1,280
Net Income: ($40,484)
Net Worth: 18.94%
Continuing Credit Union: First Choice America Community CU, Weirton, W.V.
Assets: $545.4 million
Members: 34,809
Reasons for Merger: “The board of directors has concluded the proposed merger is desirable for the following reasons: the inability to find qualified, willing volunteers to replace those who have left the credit union; The inability to find capable management and staff to maintain the credit unions operations in a safe and sound manner; The ongoing effects of the COVID-19 pandemic; and to find a credit union that can provide access to an expanded array of financial products and services…”
Merger-Related Net Worth Distribution: TMEFCU paid a share adjustment of .25% on member share balances.
Merger-Related Board/Management Compensation: None indicated.
South Division CU & Scott CU
Merging Credit Union: South Division Credit Union, Evergreen Park, Ill.
Assets: $51.6 million
Members: 5,287
Net Income: ($252,211)
Net Worth: 7.47%
Continuing Credit Union: Scott Credit Union, Edwardsville, Ill.
Assets: $1.54 billion
Members: 144,850
Reasons for Merger: “South Division Credit Union has not grown in size or membership participation for several years and has been faced with increasing operational, regulatory and compliance expenses; lack of managerial expertise, aging board of directors and no effective succession plans. We believe a merger would offset these trends by offering South Division Credit Union members access to an array of new services…”
Merger-Related Net Worth Distribution: None
Merger-Related Board/Management Compensation: None indicated.
Essex County NJ Employees CU & Essex County Teachers
Merging Credit Union: Essex County NJ Employees, Newark, N.J.
Assets: $8 million
Members: 1,818
Net Income: ($448,845)
Net Worth: 2.40%
Continuing Credit Union: Essex County Teachers
Assets: $17.6 million
Members: 2,469
Reasons for Merger: ECNJECU “does not have the resources to offer a more contemporary range of products and services to its members.”
Merger-Related Net Worth Distribution: None
Merger-Related Board/Management Compensation: None indicated.
South Bend Post Office CU & Partners 1st
Merging Credit Union: South Bend Post Office, South Bend, Ind.
Assets: $11 million
Members: 1,156
Net Income: $57,549
Net Worth: 11.52%
Continuing Credit Union: Partners 1st, Ft. Wayne, Ind.
Assets: $481.5 million
Members: 39,569
Reasons for Merger: “It has become more difficult to remain competitive with interest rates and member products and services. Additionally, today's ever changing world makes it more and more challenging to meet the demands of providing evolving technology, complying with new regulations, and safeguarding against cyber threats.”
Merger-Related Net Worth Distribution: None
Merger-Related Board/Management Compensation: None indicated.
Fairmont Village CU & GCS CU
Merging Credit Union: Fairmont Village, Fairmont City, Ill.
Assets: $2.3 million
Members: 433
Net Income: ($23,122)
Net Worth: 12.17%
Continuing Credit Union: GCS, Granite City, Ill.
Assets: $432.3 million
Members: 37,128
Reasons for Merger: “Fairmont village credit union has experienced a steady decline of members, loans and income for the last several years. Due to the competitive nature of our business and increased regulation and declining net worth, we feel it is necessary to merge so that our members can continue to receive valued financial services.”
Merger-Related Net Worth Distribution: None
Board/Management Compensation: None indicated.
Chabot CU & University CU
Merging Credit Union: Chabot CU, Dublin, Calif.
Assets: $73.3 million
Net Income: ($54,621)
Net Worth: 14.75%
Continuing Credit Union: University CU, Los Angeles
Assets: $920 million
Members: 44,131
Reasons for Merger: Chabot FCU said that since 2016 it has “witnessed a 20% decline in membership, due primarily to an aging membership base. During the same time, the credit union's loan to share ratio has averaged around 30% and most recently 33.99%. This ratio serves as a good indication of a credit union's ability to earn sustainable income and grow. With low net income, CFCU is prohibited from hiring more staff, investing in technology, expanding service hours, and growing financial literacy efforts. Despite an intense effort, CFCU has made very little inroads in serving the student body populations.”
While Chabot FCU has capital of 14.75% compared to University CU’s 7.7%, in its disclosure statement it cited “increased capital” as among the reasons for seeking to merge.
Merger-Related Net Worth Distribution: None
Merger-Related Board/Management Compensation: None indicated.
Florida Department of Transportation CU & Florida State University CU
Merging Credit Union: Florida Dept. of Transportation CU, Tallahassee, Fla.
Assets: $60.5 Million
Members: 3,159
Net Income: ($10,266)
Net Worth: 14.52%
Continuing Credit Union: University CU, Los Angeles
Assets: $322.8 million
Members: 28,858
Reasons for Merger: “We believe the merger of the two credit unions will (a) produce a merged credit union that will possess additional economies of scale that will increase financial strength and stability, (b) offer enhanced product and service lines to all members and (c) offer additional branch locations to all members.”
Merger-Related Net Worth Distribution: None
Merger-Related Board/Management Compensation: None indicated.
Municipal Employees CU & La Porte Community CU
Merging Credit Union: Municipal Employees CU, La Porte, Ind.
Assets: $1.1 million
Members: 230
Net Income: $6,929
Net Worth: 18.57%
Continuing Credit Union: La Porte Community CU, La Porte, Ind.
Assets: $59 million
Members: 7,968
Reasons for Merger: MECU said in its statement to members it is closing after 40 years because it cannot “exist without outside data processing” not can it afford a core data processing system.
Merger-Related Net Worth Distribution: None
Merger-Related Board/Management Compensation: None
Des Moines Water Works CU and Des Moines Metro CU
Merging Credit Union: Des Moines Water Works CU, Iowa
Assets: $1.3 million
Members: 460
Net Income: ($1,097)
Net Worth: 14.15%
Continuing Credit Union: Des Moines Metro CU
Assets: $69 million
Members: 6,600
Reasons for Merger: In its disclosure form, Des Moines Water Works said its board believed its limited asset size made the credit union unsustainable. The credit unions said it would close its single office as part of the merger.
Merger-Related Net Worth Distribution: None
Merger-Related Board/Management Compensation: None