EAU CLAIRE, Wis.—The $3.7-billion Royal Credit Union has agreed to purchase the Inver Grove Heights, Minn., office of Deerwood Bank, the credit union reported.
The CU stated the acquisition will offer Royal the opportunity to enhance office accessibility to its current Minnesota membership, as well as serve additional members in the local area.
The move marks the second time Royal has picked up a Deerwood Bank branch, having purchased the bank’s Apple Valley, Minn., office in 2016. That same year Royal acquired Capital Bank, based in Saint Paul, Minn. The credit union last month agreed to purchase the $500-million Lake Area Bank in Lindstrom, Minn.
The latest Deerwood acquisition is located at 7055 Cahill Avenue. Under the terms of the agreement, Royal will assume approximately $15 million in deposits and purchase assets of the Inver Grove Heights office. Pending customary closing conditions, including obtaining regulatory approval, the completion of the transaction is expected to occur in early 2022, the CU stated.
Deerwood Bank will retain ownership of its other 12 bank locations in Minnesota.
“Royal Credit Union is among a growing number of CUs that are returning several times to buy whole banks and bank branches,” stated Michael Bell, the pioneer of credit union purchases of banks and a partner and co-chair of the Financial Institutions Practice Group at Honigman, LLP, which is representing Royal.
Bell added that credit union purchases of bank branches is picking up as many banks are shedding bricks and mortar to gain greater efficiency as the pandemic has driven greater use of mobile banking. Bell has been involved in more than 40 whole-bank agreements, plus additional bank branch purchases.