WASHINGTON/ARLINGTON, Va.––Credit unions that are members of CUNA and/or NAFCU have voted in favor and approved the merger to form a new trade group to be called America’s Credit Unions.
Of those that voted, 94% of CUNA members and 86% of NAFCU members voted in favor of the merger, the organizations said.
The merger is a historic turning point in U.S. credit union history. CUNA was formed in 1934 at the famous meeting of CU pioneers in Estes Park, Colo. NAFCU was formed by a group of CEOs of federally chartered credit unions who first met in a California restaurant.
As CUToday.info noted earlier, while the associations did not cite the declining number of credit unions as a reason for the merger, dues dollars have decreased for all CU organizations, as reflected in the consolidation among CUNA-affiliated state CU leagues. NAFCU earlier changed its name and membership eligibility to open membership to federally insured credit unions, meaning state-chartered CUs could join, not just federal charters.
In a statement, CUNA and NAFCU said, “This merger is a historic opportunity to transform credit union advocacy at the federal and state levels and take the industry into the future. The new association will bring together the best of both organizations to offer exceptional services to credit unions so they can best serve families and small businesses across America.”
The organizations now face a number of tough issues related to the merger around which details have yet to be released, including how headcount will be reduced and what will become of the assets of NAFCU, which has had a much healthier bottom line than CUNA and which owns its headquarters in Northern Virginia. CUNA leases space in Washington.
Nussle: ‘Your Needs Will Remain a Priority’
“I’d like to thank our credit union members who have been engaged throughout this merger process – asking tough questions, holding us accountable, and helping us plan for the future. I am incredibly humbled to lead this new organization and fight for a stronger credit union industry,” said CUNA President Jim Nussle, who is to become president/CEO of the combined trade association. “Your needs will remain our priority as we embark on this transformation over the next several months.”
Berger: A ‘Monumental Moment’
Added NAFCU President Dan Berger, who is to leave his post at year-end, “This successful vote is a monumental moment for the credit union industry. With Jim at the helm, supported by the board of directors’ expertise and leadership, I am confident America’s Credit Unions will prove to be a successful, innovative, and service-first association that will elevate the industry well into the future.”
America’s Credit Unions will legally be formed Jan. 1, 2024, and the new association will spend the next several months aligning products and services to “meet members’ needs, and committing to a culture that emphasizes accountability, transparency, and responsiveness,” CUNA and NAFCU said.
The associations said they will provide credit unions with regular updates on the transformation process.
Schools: ‘Tackle Challenges Head On’
“As credit union leaders, we are aware of the challenges facing our industry, but also the incredible opportunities each of our institutions have to improve people’s lives. I am confident that America’s Credit Unions will empower the industry with the advocacy, education and training, and compliance assistance needed to make the most of these opportunities and tackle challenges head on,” said Brian Schools, president and CEO of Chartway FCU in Virginia, in a statement. Schools, who is chair of NAFCU, will serve as chair of America’s Credit Unions transition board of directors.
Ginter: ‘Epitome of the Cooperative Spirit’
Added Lisa Ginter, president and CEO of Community America Credit Union, who is the current CUNA chair and who will serve as vice chair of the transition board, “The transformation to America’s Credit Unions is the epitome of the cooperative spirit of the credit union industry. From the start, this merger has been about doing what’s best for the future of our industry and bolstering the individual success of our institutions through our collective strength. I am excited to show the country the full force of the credit union difference.”
The Financials
According to IRS Form 990 data available through ProPublica, CUNA posted a loss of $5.362 million for its fiscal year 2021, following a loss of $9.8 million in fiscal year 2020. For 2021, the trade group had total revenue of $69.543 million against total expenses of $74.906 million. It reported total net assets of $41.038 million.
Both 2020 and 2021 were years marked by the pandemic, which shut down many of the events and meeting sponsored by the trade associations that are significant revenue generators.
In 2021, Nussle was CUNA’s highest compensated employee with reportable W2 compensation of $1.798 million, plus $487,821 in other compensation from organization and related organizations.
The same 990 information filed by NAFCU shows the trade group has remained in the black. For its fiscal year 2021, NAFCU reported total revenue of $21.551 million and net revenue of $1.725 million, with net assets of $18.028 million. It showed $1.795 million in net income in 2020.
16-Person Board to Be Formed
The new association will initially be governed by a 16-person board. The transition board will include current board members from both CUNA and NAFCU, including members of each board’s executive committee, the associations said.
During NCUA’s DEI Summit this week, there was some discussion about a lack of diversity on the board.
In addition to Schools and Ginter, listed above, the transition board executive committee includes Treasurer Patrick Pierce, who is CEO of City and County Credit Union, and Secretary Karen Harbin, president/CEO of Commonwealth Credit Union.
In addition to the executive committee, the remaining proposed board roster includes:
- Lonnie Nicholson, president/CEO of Educational Employees Credit Union
- Nader Moghaddam, president/CEO of Financial Partners Credit Union
- Jeff Olson, president/CEO of Dakota Credit Union Association
- Gary Grinnell, president/CEO of Corning Federal Credit Union and current NAFCU board chair
- Lori Herrick, president/CEO of Manchester Municipal Federal Credit Union
- Scott Simpson, president/CEO of Utah Credit Union Association
- Melanie Kennedy, president of Southwest Financial Federal Credit Union
- Keith Sultemeier, president/CEO of Kinecta Federal Credit Union
- Brian Best, CEO of GTE Financial Credit Union
- Jim Morrell, president/CEO of Peninsula Community Federal Credit Union
- Amy Sink, CEO of Interra Credit Union
Proposed Continuing Board
Plans call for America’s Credit Union to have a board that consists of 15 voting members and two nonvoting members:
- There will be four classes of members: geographic (nine directors), at-large (four directors), league (two directors) and nonvoting (two directors)
- Each geographic class will be represented on the continuing board; there will be three small, three medium, and three large credit unions seats.
- At-large members of the continuing board will be elected from all credit unions
- Continuing board executive committee officers will be chair, vice chair, treasurer, secretary, and America’s Credit Unions CEO
- Only directors from natural person credit unions and the CEO will be allowed to hold officer positions
The Dues Structure
According to CUNA and NAFCU, the dues structure will be as follows:
2024 Dues
Calculated using the same CUNA methodology or NAFCU methodology currently in effect, as of December 31, 2023.
2025 Dues
Calculated using 2023 invoice methodology.
2026 Dues
Calculated using 2023 invoice methodology.
2027 Dues
Calculated by the new America’s Credit Unions dues structure, as will be determined by the Board of Directors.
Existing Dual Members as of Dec. 31, 2023
2024 Dues
“Dual members are encouraged to pay membership dues for both organizations,” the trades groups said, noting dues will be calculated using the same CUNA methodology and NAFCU methodology currently in effect, as of Dec. 31, 2023.
Members Paying Dual Dues for 2024
2025 Dues
Equal to the greater of the dues that would have been paid using CUNA’s current methodology or NAFCU’s current methodology, as of December 31, 2023.
2026 Dues
Calculated using 2024 invoice methodology as indicated for existing dual members.
2027 Dues
Calculated using 2024 invoice methodology as indicated for existing dual members.
2028 Dues
Calculated by the new America’s Credit Unions dues structure, as will be determined by the Board of Directors.
Additional Comment
Others offering comment include:
AACUL: “We look forward to standing alongside America’s Credit Unions, as we work together to continue to protect and advance a vibrant credit union system,” said Jeff Olson, chairman of the American Association of Credit Union Leagues and president/CEO of the Dakota Credit Union Association. “The league system is excited to move into the future with a single national trade association; credit unions and members alike will benefit from a more unified voice which will strengthen our advocacy efforts and increase the overall impact of the collective work of the league system and America’s Credit Unions.”
Virginia League: “The coming formation of a new national credit union trade association represents a singular opportunity to leverage the strengths of both CUNA and NAFCU in order to advance our industry,” said Virginia CU League President/CEO Carrie Hunt, who was with NAFCU prior to joining the Virginia league. “A single national trade association promises dues-paying credit unions operational efficiencies, economy of scale and a unified voice on the advocacy front.
"We are all keenly aware of the challenges we face as an industry,” continued Hunt. “We are excited about the promise of America’s Credit Unions and its potential to help us navigate those challenges and help drive success for the whole of our industry. From the perspective of your League, we remain committed to partnerships that strengthen credit unions and advance our mission. As the ‘America’s Credit Union’ association takes shape, we’ll work to ensure Virginia’s credit unions have a voice in its direction, leadership and service offerings.
“We believe our industry is made stronger and more resilient by collaboration and a shared commitment to credit unions’ success,” said Hunt. “Your League looks forward to working with your credit union, our fellow leagues and America’s Credit Unions in continuing that proud tradition of collaboration and cooperation. Ultimately, we all share the same vision for a thriving and diverse credit union industry.”
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