ALEXANDRIA, Va.–Eight more credit unions have filed their member disclosure forms with NCUA sharing the reasons they say they need to merge.
Those forms—included as part of CUToday.info’s comprehensive coverage of all merger activity within credit unions—reveal many of the usual suspects reasons cited by other credit unions, and again the CUs seeking to merge are all primarily small, with most under $10 million. Many are also reporting red numbers including one of the acquiring credit unions.
Lack of a candidate to succeed a retiring manager, inability to afford technology, and opportunity to expand “products and services” are frequently cited.
Just one of the eight CUs—even though many have capital of in the 20% range or more—said there will be any distribution of net worth.
CEO Retirement Cited as One Reason for Merger
Merging Credit Union: Superior Savings CU, Massillon, Ohio
Assets: $29.4 million
Members: 2,754
Year Chartered: 1968
Date of Member Vote: Jan. 30, 2023
Acquiring Credit Union: Golden Circle CU, Massillon, Ohio
Assets: $95.1 million
Members: 6,572
In its statement to members, Superior Savings CU’s board said, “The long-term CEO (Debbie Carpenter) of Superior Savings Credit Union is scheduled to retire at the end of 2022. Superior Savings’ board performed a talent search to recruit a CEO who could provide strong leadership to the credit union. No external or internal candidates met the board’s requirements and this search was unsuccessful. At the beginning of 2023, the credit union will operate without adequate leadership, which will impair operations and could negatively impact the membership.”
The credit union also said the merger will provide members with products not currently available, including additional electronic services, financial planning and more.
Members will also have access to two additional branches and shared branching, the CU said, while employees will receive additional benefits.
There are no plans for any capital distribution.
As of Sept. 30, SSCU reported a $42,682 loss, with capital at 8.31%. Golden Circle reported negative $558,712 in net income, with capital of 14.54%.
Operational Cost Savings, More Branches Cited in Alaska Merger
Merging Credit Union: ALPS FCU, Sitka, Alaska
Assets: $83.5 million
Members: 4,046
Year Chartered: 1960
Date of Member Vote: Jan. 21, 2023
Acquiring Credit Union: Tongass FCU, Ketchikan, Alaska
Assets: $164.5 million
Members: 8,975
In its notice to members, ALPS FCU said the benefits of merging will include achieving operational cost savings and improving financial strength, while also providing new branches in multiple markets, offering increased business and real estate lending and increased financial education opportunities.
In a twist not usually seen in merger disclosures, the statement also lists benefits for the acquiring CU, Tongass FCU, that include increased returns to members from additional capital and savings and efficiencies, as well as additional branches and “trained staff to fill leadership and other positions.”
ALPS FCU said there will be no net worth distribution, but that its CEO, Sandi Riggs, whose employment will terminate with the merger, will receive 12 months of salary, not to exceed $140,400, as part of the combination.
ALPS FCU reported $194,690 in net income through September, with capital of 8.50%. Tongass FCU posted $567,005 in net income and net worth of 13.47% as of Sept. 30.
Access to a Drive-Through Among Benefits of Proposed Merger
Merging Credit Union: T.C. Teachers FCU, Texas City, Texas
Assets: $6.539 million
Members: 841
Year Chartered: 1953
Date of Member Vote: Jan. 19, 2023
Acquiring Credit Union: Gulf Shore FCU, Texas City, Texas
Assets: $15.5 million
Members: 1,574
T.C. Teachers FCU told its members it has “concluded the proposed merger is desirable and in the best interests of members because it allows members to have a drive-through, two locations (that) are more convenient and additional services will be provided such as mobile check deposit, IRAs and extended hours.”
Despite capital of 15.76%, the CU said there will be no net worth distribution, but its main office will remain open.
T.C. Teachers reported a loss of $46,977 through September. Gulf Shore FCU reported $23,250 in net income, with capital of 8.27% as of the same date.
Plan is to Distribute 2% of Net Worth
Merging Credit Union: Arkansas Farm Bureau FCU, Little Rock, Ark.
Assets: $9.52 million
Members: 574
Year Chartered: 1992
Date of Member Vote: Jan. 24, 2023
Acquiring Credit Union: Baptist Health FCU, Little Rock, Ark.
Assets: $43 million
Members: 7,766
In its disclosure to members, Arkansas Farm Bureau said the merger is desirable because it will provide members with access to “more diverse low-cost services and products than currently are offered. Also, increased costs associated with regulatory compliance and costs associated with new technology makes this move a necessity.”
AFBFCU said it will distribute 2% of its net worth, or about $200,000 to members. The CU said it will close its main office if the merger is approved.
Arkansas Farm Bureau’s mid-year call report shows $27,386 in net income, with capital of 19.50%. Baptist Health posted $493,549 in net income as of Sept. 30, with capital of 14.51%.
In Mississippi, Acquiring CU Posted Loss
Merging Credit Union: Mid Delta FCU, Indianola, Miss.
Assets: $2.5 million
Members: 835
Year Chartered: 1965
Date of Member Vote: Jan. 24, 2023
Acquiring Credit Union: Delta FCU, Greenville, Miss.
Assets: $6.2 million
Members: 1,117
In its message to members, Mid Delta FCU’s board said it had concluded the merger will provide the “membership better benefits and products that Mid Delta FCU doesn’t have.”
Although capital was 22.13% as of Sept. 30, the CU said there will be no distribution of net worth. Mid Delta FCU reported $222 in net income as of the third quarter. Delta FCU showed a $16,266 loss as of Sept. 30, with capital of 20.34%.
‘Thriving, But Not Immune’ to Challenges, Says Craftmaster FCU
Merging Credit Union: Craftmaster FCU, Towanda, Penn.
Assets: $14.1 million
Members: 1,347
Year Chartered: 1971
Date of Member Vote: Feb. 8, 2023
Acquiring Credit Union: Ingersoll-Rand FCU, Athens, Penn.
Assets: $71.7 million
Members: 5,022
In its statement to members, Craftmaster FCU told members it is “thriving, but not immune to the ever-increasing challenges in many vital areas: location, new products and services, compliance, member information security and qualified staffing.”
Its statement went on to say the merger “will increase operating efficiencies with the combined strengths and talent of both credit union staff, expanded products and services for our credit union members convenience. Ingersoll-Rand FCU offers a vast array of deposit and loan products and services to members and businesses. Community involvement and financial education are also high on their list of priorities for the membership groups they serve.”
CFCU said that as of June 30, 2022 its net worth was 20.61%, compared to 18.41% at Ingersoll-Rand FCU, but that it will not be paying out any of the net worth since IRFCU offers “increased member services.”
Craftmaster FCU said it will close its one office, as an IRFCU branch is nearby.
CFCU reported $189,706 in net income through Sept. 30. IRFCU reported $205,766 in net income as of the same date.
‘Limited Staffing, Future Retirement Intentions’ Among Reasons for Merger
Merging Credit Union: Northern Chautauqua FCU, Silver Creek, N.Y.
Assets: $4.018 million
Members: 577
Year Chartered: 1969
Date of Member Vote: Feb. 16, 2023
Acquiring Credit Union: Inner Lakes FCU, Westfield, N.Y.
Assets: $132.1 million
Members: 9,558
In its disclosure to members, NCFCU said the merger is desirable because of “limited staffing” and “future retirement intentions,” and because “it does not offer many of the products and services that are expected by members, especially younger members. These would include debit and credit cards, online banking, electronic checking depositing, wire services, to name a few.”
Northern Chautauqua FCU reported a loss of $4,099 as of Sept. 30, with net worth of 9.04% (it said there will be no net worth distribution). Inner Lakes FCU reported $818,477 in net income, with capital of 8.75% as of the same date.
Marriott Employees Aims to Turn Off Vacancy Sign
Merging Credit Union: Marriott Employees FCU, Rockville, Md.
Assets: $191.5 million
Members: 22,640
Year Chartered: 1953
Date of Member Vote:
Acquiring Credit Union: USAlliance FCU, Rye, N.Y.
Assets: $2.644 billion
Members: 144,909
In its message to members, Marriott Employees FCU said the merger will expand services, including lower fees on deposit accounts, credit builder loans, “nationally recognized dividend rates on shares and certificates, industry leading mobile banking and account features, emergency loans with immediate funds availability for members who qualify, expanded mortgage and home equity loan services, including first-time home buyer program and expanded member service access channels.”
MEFCU said there will be no distribution of capital and its currently closed branch will remain closed.
As part of the merger, Marriott Employees FCU said compensation will be paid to two employees, including:
- President and CEO Susan Wolfe will be paid $187,500, reflecting severance for 37 years of service
- Joyce Parker, EVP and second EO, who is to be paid $155,626, reflecting 27 years service.
The credit union said in both cases the payments are also to be a “special incentive for assistance in operational transition.”
Marriott Employees reported a loss of $610,937 through Sept. 30, with capital of 9.61%. USAlliance reported $18.298 million in net income with capital of 8.75%.
Additional Merger Information
CUToday.info has published analyses of all merger disclosure forms filed with NCUA by credit unions during 2022. You can find more at the links below:
Jan. 12
March 16
April 26
https://www.cutoday.info/Fresh-Today/What-Review-of-Latest-CU-Merger-Proposals-Reveals-Part-I
April 27
https://www.cutoday.info/Fresh-Today/What-Review-of-Latest-CU-Merger-Proposals-Reveals-Part-II
May 17
May 18
June 8
https://www.cutoday.info/Fresh-Today/Here-s-What-Latest-Disclosure-Forms-on-Proposed-CU-Mergers-Reveal
June 28
https://www.cutoday.info/Fresh-Today/A-Deceased-CEO-A-Big-Staff-Departure-No-Payout-Despite-High-Capital-A-We-Like-Them-Partner-Here-s-the-Latest-on-8-Proposed-CU-Mergers
Aug. 11
Aug. 10
Aug. 9
Oct. 24
Oct. 25
Oct. 26
Nov. 17
https://www.cutoday.info/Fresh-Today/Among-10-Latest-CUs-to-Announce-Merger-Plans-a-Common-Theme
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