JOLIET, Ill.–Two more credit unions have announced they are buying banks, both in Illinois.
The $632-million NuMark Credit Union said it is purchasing the $135-million Pioneer State Bank in Earlville, Ill. Pioneer Bank is a wholly-owned subsidiary of NBE Bancshares.
Separately, Lombard, Ill.-based Credit Union 1 here has agreed to buy the $311-million NorthSide Community Bank, located approximately an hour north in Gurnee, Ill.
In the NuMark acquisition, financial terms of the all-cash transaction--NuMark CU’s first bank purchase--were not disclosed.
Founded in 1901, Pioneer State Bank has 27 employees across four branches in Earlville, Paw and Sublette, Ill. The bank also runs one seasonal location.
According to financial reports filed with the FDIC as of March 30, Pioneer State had $113 million in deposits, $13.7 million in capital and a net income of $202,000. It recorded an ROA of 0.60%. The state-chartered bank specializes in commercial lending, including agricultural services.
Plans call for the deal to close in the fourth quarter. Olsen Palmer, LLC served as the financial advisor to NBE Bancshares, Inc.
Credit Union 1 Buying Bank
Meanwhile, the $1.2-billion Credit Union 1 here said its plans to acquire NorthSide Community Bank in a deal expected to be completed in the fourth quarter of 2022. The acquisition has been approved by the boards of directors of both organizations and is awaiting regulatory and bank shareholder approval, CU1 reported.
The purchase price was not disclosed.
CU1 said it plans to retain the bank’s staff.
“We are excited about the commercial lending expertise NorthSide represents. (Northside President and CEO) Patti Clausen, Jim Randall, and the entire NorthSide leadership team have fostered a customer centric culture that aligns and brings value to the entire Credit Union 1 business banking platform,” said Todd Gunderson, CU1 president and CEO. “We are excited to be able to serve more members by expanding our footprint in the northern Chicago suburbs. This acquisition for CU1 in the Chicagoland area perfectly complements our strategy of organic membership and asset growth through expanded products, services, and technologies.”
Added Clausen, the bank’s CEO, “We chose to partner with Credit Union 1 because its culture, leadership and lending culture all align very closely with ours. With the size and scale Credit Union 1 adds it not only strengthens our ability to serve our existing customers in the manner that they have come to expect but also allows us to increase the number of businesses that we can help grow across the new combined partnership. We are excited to be a part of that promising future.”
CU1 made $13.7 million in 2021 and $7 million in 2020. Capital stands at 8.75%. Northside Community Bank made $2.3 million in 2021 and $2.2 million the previous year.
A Record Year
Michael Bell, the pioneer of credit union purchases of banks and the attorney for CU1 in this deal, said this agreement solidifies his position that 2022 will be a record year for credit union bank buys.
“I said we would see more than 20 of these deals this year, and the latest announcement only makes me more confident that number will be achieved. Also, the fact these deals are picking up just further shows that bankers see credit unions as a valuable option when they decide to sell,” stated Bell, partner and co-chair of the Financial Institutions Practice Group at Honigman, LLP.
Bell has been involved in well over 45 whole-bank agreements, plus additional bank branch purchases.