BIRMINGHAM, Ala.—As more credit unions seek bank buys to grow, another CU/bank deal closes.
This time it’s $607-million Avadian Credit Union’s purchase of $127-million American Bank of Huntsville, located in Huntsville, Ala. The deal closes April 30.
The $1.7-billion Royal Credit Union, Eau Claire, Wis., Wednesday announced it intends to buy the $35-million Capital Bank, based in Saint Paul, Minn.
According to Michael Bell, attorney and counselor with Royal-Oak, Mich.-based Howard & Howard, who represented Avadian, approvals have been given by both state banking regulators, the FDIC and NCUA.
"This is a fantastic transaction for Avadian and its member owners. It's also a gain for the Huntsville market," said Bell, who has been part of nine CU/bank deals, including one merger of a bank into a credit union.
Data Conversion To Come
Bell said converting the bank’s data system still needs to be completed.
Avadian will assume operation of the American Bank's single location on Memorial Parkway, giving Avadian 19 locations.
“As a growing credit union looking for opportunities to expand our services in North Alabama, we are excited about this forward-thinking collaboration and believe it is a great fit all the way around,” said Linda Cencula, president and CEO of Avadian, in a previous report.
Nine Deals
Michael Bell, Howard & Howard
Bell also represents Royal Credit Union. If Royal’s deal is finalized, it will be the ninth time a credit union has purchased a bank since 2011, when Michigan's $1.6-billion United FCU pioneered such purchases by acquiring $81-million Griffith Savings Bank in Indiana.
In February, Advia CU in Parchment, Mich., announced plans to acquire Mid America Bank in Janesville, Wis. Avadian signed its agreement last August. Last May, the $1.1-billion Achieva CU, Dunedin, Fla., signed an agreement to acquire the $165-million Calusa Bank based in Punta Gorda, Fla. The deal marked what is believed to be the first time in history a credit union merged with a bank, rather than do a purchase-and-assumption.
In addition to the United, Royal, Advia, Achieva and Avadian agreements, the other CU/bank deals to date: The $318-million Alabama-based Five Star CU purchased the $23-million Flint River National Bank in Camilla, Ga., and closed a deal with $47-million Farmers State Bank in Lumpkin, Ga.; the $1.2-billion Municipal Employees CU of Baltimore purchased local $61-million Advance Bank; Wisconsin's $2.1-billion Landmark CU acquired $190-million Hartford Savings Bank; and Massachusetts' $429-million GFA FCU bought New Hampshire's $83-million Monadnock Savings Bank.