TRAVERSE CITY, Michigan –The $1-billion 4Front Credit Union here has agreed to buy $130.2-million Old Mission Bank, approximately 175 miles north in Sault Ste. Marie, Mich.
The deal is expected to close in late 2023, pending customary regulatory approvals and approval from the bank’s shareholders, the CU reported. Terms of the agreement were not disclosed.
The addition of Mission Bank’s two offices will increase the number of 4Front Credit Union offices to 20.
The bank locations will operate as “Old Mission, a Division of 4Front Credit Union,” the 98,000-member credit union said, adding all bank staff will be retained.
“We believe in making banking smart and simple,” said 4Front Credit Union CEO Andy Kempf. “We look forward to expanding our services in the Upper Peninsula to even more people through exceptional experiences, wherever they are on their financial journey.”
Added Gary Sharp, CEO of Old Mission Bank, "We are excited about our new partnership with 4Front Credit Union, which will bring expanded opportunities to our customers, employees, and communities while keeping the hometown feel.”
The bank posted $844,000 in net income for 2021 and $382,000 through September of 2022, according to FDIC data. 4Front reported $9.4 million in net income 2021 and $8 million through September of 2022, according to Call Report data. The CU’s net worth is 9.16%.
Could Be Biggest Year Ever
Michael Bell, the pioneer of credit union purchases of banks, said this agreement early in the year, along with an earlier announced deal by Illinois-based Land of Lincoln Credit Union’s to acquire Colchester State Bank, supports his assertion that 2023 could be the biggest year yet for these deals, depending on the economy.
“2023 is starting quickly,” said Michael Bell, the leader of the Financial Institutions Practice Group at Honigman LLP, which is representing 4Front. “If the economic factors can calm sooner rather than later, I absolutely expect a record year.”
Bell has been involved with nearly 50 credit union purchases of banks.