CARLISLE, Penn.–Despite organized opposition and much debate over reasons for the merger, members of $105-million Cornerstone FCU have voted in favor of combining with the $450-million Belco Community CU.
Members voted 1,100 to 630 in favor of the merger Thursday night at a special meeting at the Comfort Suites in downtown Carlisle.
As CUToday.info has reported, the merger has been strongly opposed by a group of Cornerstones FCU members calling themselves the Committee for Cornerstone FCU Independence and headed by the CU’s former CEO Dave Keffer. The group had organized an effort to stop the merger with Harrisburg, Penn.-based Belco. The effort included radio commercials appearing on three stations and newspaper ads that urged CFCU members to vote no on the planned combination.
Keffer, who was CEO of Cornerstone for 33 years before retiring two years ago, has asserted that the merger is simply an example of a big credit union trying to buy its way into a market. Keffer also alleged that Cornerstone was not sharing all the details of the merger with members so they could make an informed decision.
Belco Says Merger Beneficial
But the current leaders of the two credit unions—Belco CEO Amey Sgrignoli and Cornerstone President Sam Glesner—disagreed, as CUToday.info reported here, saying the merger is beneficial for each organization and that members are being openly communicated with.
CUToday.info has also extended an invitation to Belco Credit Union to comment on the outcome of the vote.
Keffer spoke with CUToday.info shortly after the decision was announced last night, and he admitted he was greatly disappointed in the outcome.
“Yet it was uplifting to see a lot of my old friends again turn out or this meeting,” Keffer said. “These were a lot of the folks I contacted to help share information about the merger. It was just overwhelming the numbeer of people who turned out—more than 150, I think. They wound down the steps outside the meeting room as they registered for the vote.”
Being 'Railroaded'
Keffer said that many of those at the meeting felt they were being “railroaded” by the merger and were not afraid to speak up and ask Glesner and Cornerstone Board Chairman Richard Love “hard questions.”
“They were all wearing T-shits we handed out that said ‘Vote no to keep Cornerstone independent’,” explained Keffer. “It really made a difference for me. I got emotional seeing the passion these members have for their credit union.”
But in the end, Keffer believes there was too little time for his group to rally enough member support, especially with many ballots having already been mailed in by the time the Committee was launching its efforts. Keffer believes that not enough members understood the negatives of the deal, which he alleged that Belco was not sharing. Keffer and his team had emphasized strongly that many Cornerstone performance metrics are better than Belco’s, and that there was no need for a merger and greater economies of scale. The Committee had been handing out flyers that listed both CUs’ performance statistics in a side-by-side chart.
“We have a lower expense-to-asset ratio than they do (3.23% compared to 4.29%). We have a stronger net worth position (10.24%) than they do (9.88%), and our loan, deposit and fee structure is better for members,” said Keffer in a previous report. “We also match them on mobile and Internet banking. So having to merge does not make sense to me. This is not a better deal for Cornerstone and its members.”
“All I have been saying is give the members all the facts and then let them make an informed decision,” he said. “I feel members were being left in the dark about a lot with this merger.”
'Clearly Communicated'
But Sgrignoli, in an earlier report in CUToday.info, said the merger has been “clearly” communicated to members over the last 90 days via Cornerstone’s website, emails, mailings and the information sessions.
Keffer had said that if members don’t vote to keep Cornerstone independent, it would be a bad sign for the future of the movement.
“If that happens, then this merger would just be another example of what has been happening across the country,” said Keffer in an earlier report.
Asked if he will continue as a member with Belco, Keffer said it’s too soon to make that decision given the emotions of the night.
“I am upset now, and I need to cool down,” he said. “I will certainly be with a credit union, but at this moment I am not sure where I stand. Belco is not a bad credit union. I just feel they were misdirected in how they approached the merger—they seemed a little anxious to see this happen.”
CUToday.info reached out to Sgrignoli for comment on the vote.