WASHINGTON/ARLINGTON, Va.–Today is the last day CUNA and/or NAFCU-affiliated credit unions can cast their vote for the historic proposed merger between the two groups that, if approved, would create a new trade group to be called America’s Credit Unions.
As CUToday.info reported in early August, CUNA and NAFCU announced their plans to merge with the voting period open for 60 days. The groups have said they will announce the results within “several days” of the close of voting.
The proposal marks a potentially 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.
The Management Plan
If approved, plans call for CUNA President and CEO Jim Nussle to hold the same position with the merged organization. NAFCU reported its president and CEO, Dan Berger, made a decision earlier this year to step aside to fulfill family obligations and pursue other opportunities, but he will remain at the association until year-end before departing.
According to the associations, the boards voted unanimously in May to merge the two organizations.
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.
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 meetings sponsored by the trade associations that are significant revenue generators.
In 2021, CEO Jim Nussle was CUNA’s highest compensated employee with reportable W2 compensation of $1.798 million, plus $487,821 in other compensation from the 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
Should members approve the merger, America’s Credit Unions will legally be established no earlier than January 2024, the associations said, with the intent to be fully operational by early 2025. 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.
‘Doubling Down’
“By bringing together these two powerful credit union associations we are doubling down on our commitment to ensure the growth and prosperity of all credit unions across the nation and the 137 million Americans they serve,” said Nussle at the time the merger plan was announced. “We look forward to uniting CUNA and NAFCU in what will be an exciting new chapter ahead, and we’re thrilled about the opportunities this will create for our members, employees, and business partners.”
Added Berger, “Both CUNA and NAFCU have worked together over the years to achieve victories for the credit union industry, and now the sky is the limit. I believe this is the best path forward for the industry. A new, singular association under Jim’s fervent leadership will be able to harness the combined talent of both organizations to provide outstanding value to our members and ensure every household in America has the best credit union to serve them.”
Transition Board
CUNA and NAFCU have named 15 members who will serve on a transition board if the proposed merger between the two groups is approved by their members.
Executive committee members of the proposed board are Vice Chair Lisa Ginter (CUNA board chair), who is CEO of Community America Credit Union; 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
Meanwhile, the organizations said that if the merger gets the OK the continuing board will consist 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 if the merger is approved 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 Dec. 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.
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