SIOUX FALLS, S.D.—The $470-million Levo Credit Union plans to acquire a Sioux City, Iowa, branch of Heritage Bank, the CU announced. The two markets are approximately 85 miles apart.
“This acquisition aligns with our growth strategy, allowing us to better serve the needs of our members and provide opportunity for more people to live better. That’s our mantra – live better – and that’s what we do is help people live better. Our members are our owners, which means we work for them. We exist to help them reach their financial goals, and they appreciate that,” said Levo President and CEO Fran Sommerfeld.
Once the agreement is approved by regulatory authorities and signed by both parties, Levo will take on some deposits and loans, as well as property, the CU said, adding it may take several months to close the deal.
Levo Credit Union reported $2.5 million in net income during, and has 11.06% net worth, according to call report data.
‘Good for Employees & Customers’
“We are confident this move will be good for our Sioux City employees and customers,” said Thomas Geiger, chairman and CEO of Heritage, which is based in Spicer, Minn. “We’ll be leaving them in good hands.”
The Advisors
Levo was advised by Honigman, LLP as legal counsel and Mercer Capital as financial advisor. Olsen Palmer LLC served as financial advisor to Heritage, while Ballard Spahr LLP served as legal counsel. The transaction has been unanimously approved by both boards of directors, the CU said.
“Banks continue to explore branch sales and credit unions continue to be great buyers of bank branches,” stated Michael Bell, a partner and chair of the Financial Institutions Practice Group at Honigman. “It’s a win for the branch remaining open, the employees and the community.”
Bell, the pioneer of CU purchases of banks, has been part of more than 50 whole-bank agreements, plus additional bank branch purchases.
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