BRATTLEBORO, Vt.–Two Vermont credit unions say they are planning to merge, although the combination still requires a vote by members and regulatory approval.
The $148-million River Valley Credit Union and the $157-million Members Advantage Community CU are seeking to merge, with Jeffrey Morse, CEO of River Valley CU, telling the Battleboro Reformer the deal involves two "like-sized and like-minded Vermont credit unions.”
Morse told the publication the merger will have many benefits for the 18,585 members at River Valley, including enabling the CU to offer some types of loans it is currently prohibited from offering, such as business loans, and that the same holds true for Members Advantage.
Morse also said the merger would lead to lower fees for members.
"We're in great financial shape," Morse told the Reformer, but he added financial institutions are feeling “incredible pressures” and that 10 years from now the credit union would face even greater challenges without the merger with Members Advantage.
"This partnership will expand and improve our ability to serve the lending needs of our members. By combining credit unions, we will have a larger capacity to lend to our members and we will be adding more loan products," Morse told the publication.
‘A Lot of Misinformation’
River Valley CU Chairman Mike Cooney told the Reformer the merger has the unanimous support of the credit union's directors. “He said there is a lot of misinformation about the merger, and wants to stress that he views it as a complete plus for the members of River Valley,” the publication reported.
River Valley was created in 1948 when Putney Credit Union merged with the Springfield-based Maple Valley Credit Union. Members Advantage, which is slightly smaller in membership than River Valley, was created with the merger of five small credit unions in the Barre, Vt. Area, according to the report.
A public hearing held before state regulators produced some questions and concerns about the merger, Cooney told the Reformer, but he added those questions were answered during the hearing.
Both Morse and Cooney said there would be no layoffs or closures of River Valley offices, although the corporate address would shift to Barre.
Morse told the Reformer he is the only member of the executive team who would be leaving, and he said he has wanted to retire. He said he would remain as a consultant for three years once the merger is approved.
Discussions for Several Years
Morse further told the Reformer the merger discussion started between himself and Sean Gammon of Members Advantage a few years ago, and they talked about it more seriously more than a year ago.
Plans call for the majority of the directors of the merged credit union would come from Members Advantage (seven out of 13), even though River Valley has more members.
“Members Advantage has more reserves than River Valley, Morse said, but that's because River Valley takes its mission as a credit union of loaning members' deposits to other members more seriously,” the publication stated.
Morse said there will be four informational meetings about the merger, including at least one in person that will follow safety guidelines.