ALLEGAN, Mich.–Two Michigan credit unions that have been operating with the same president and CEO said they are seeking to merge but plan to retain their brands.
The $82.2-million Allegan Credit Union and the $78.1 million Rivertown Community Credit Union in Grandville, Mich., said they are seeking to combine and will now look to members for approval.
If approved, the combined credit union is to operate under a unified brand but each CU will continue to keep its individual names, the organizations aid. The merged credit union would serve nearly 14,000 members with five branches in Western Michigan.
In announcing the planned merger the credit unions quoted Helen Keller, who said, “Alone we can do so little; together we can do so much.”
“In a financial services sector that is constantly shifting, this merger represents a collaborative pooling of resources and talent coupled with the commitment to serve members, employees, and the community,” the credit unions said in a statement.
Response to ‘Critics’
“Together these organizations would be in an even better position to leverage resources to continue to expand their product, service, convenience, and technology offerings.
“Critics may be quick to point out why credit unions shouldn’t merge, however in today’s highly regulated, high-tech environment, it’s becoming more difficult for smaller credit unions to compete at the same level as the bigger players,” the statement continued. “Left on their own, it is becoming more and more challenging to offer the wide range of products and services that members (who are consumers) want.”
The credit unions also cited the challenge of attracting new members and employees in a competitive environment, and said the merger is designed to provide scale while allowing each CU to maintain their unique brand identity.
Evolving Viewpoint
“As the CEO of Allegan Credit Union for the past seven years and Rivertown for the past year, my viewpoint on mergers has evolved,” said Kristopher Lewis. “I see our similarities and I see our differences, and both should be celebrated and preserved. I have a passion for our industry and for helping the greater good of credit unions, members, and the communities we serve.”
Lewis was part of the start-up Credit Union Service Organization designed to offer accounting & CFO services to credit unions unable to afford internal resources or with a gap to fill, the credit unions added.
CUSO Brings Perspective
“Being involved in CUSOs and serving as a dual CEO, I have gained a greater perspective on what we can leverage and accomplish together as one for our members and our communities,” said Lewis. “Our mission at Allegan is ‘community over credit score, relationships over revenue, and people over profit.’ And Rivertown was built for hard-working people who had a genuine interest in helping those that couldn’t find the financial resources from the big banks. This partnership is a perfect way to live out our mission and to go back to why we exist, creating relationships and helping those that don’t have the financial resources on their own.”
If the merger is approved, the credit unions plan to complete the merger in late 2022 or early 2023.
How the 2 CUs Performed
Allegan Credit Union posted net income of $2.028 million with net worth of 9.90% as of March 30.Rivertown Community CU reported $142,960 in net income and capital of 13.22% as of the same date.
Merger Completed in the Bluegrass
Meanwhile, members of the $578,000 Security Plus FCU in Russellville, Ky., have voted in favor of merging into the $223 million Service One Credit Union in Bowling Green, Ky.
The credit unions announced plans to combine in November of 2021. When complete, the Security Plus FCU branch will remain open and bring to five the number of Service One branches.
Service One reported $271,590 in net income and capital of 9.71% as of March 31. Security Plus lost $34,433 through the same date, but has a whopping net worth of 45.92%.
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