By Ray Birch
RICHLAND, Wash.—Only days after the annual record was set for credit union purchases of banks, the $2.4-billion HAPO Community Credit Union announced it has agreed to buy $632-million Community First Bank, based in Kennewick, Wash.
The deal marks the 18th of the year, and follows the deal between OneAZ Credit Union and 1st Bank Yuma last week, which set the one-year record for these agreements at 17. Sixteen was the previous record, established in 2022.
Scott Mitchell
In the purchase and assumption, HAPO will acquire and assume substantially all the assets and liabilities of Community First Bank. The deal will give HAPO 25 branches across its markets. The transaction is expected to be completed in the third quarter of 2025, subject to receiving all regulatory approvals, Community First Bank shareholder approval, and other customary closing conditions. The transaction has been approved by the boards of directors of both institutions. Details of the agreement were not disclosed.
The credit union said the merger aligns with its vision of delivering a broader range of financial products and personalized services while maintaining its core values of member-centricity and community commitment.
Performance Data
Community First made $2.5 million in net income through June of this year and $4.6 million in 2023, according to FDIC data. HAPO made $16.3 million in net income through June of ’23 and $34 million last year, according to Call Report data. Net worth stands at 10.84%.
HFG Trust, a subsidiary of Community First Bank, will be restructured as an independent entity, HAPO stated.
“We are excited to unite with Community First Bank in this strategic acquisition,” said HAPO President and CEO Scott Mitchell. “Both HAPO and Community First Bank have long been committed to serving the Tri Cities and surrounding communities. This acquisition will enhance HAPO’s capacity to support local economic growth and address the financial needs of residents and businesses more effectively. We are thrilled to welcome the talented team at Community First Bank and look forward to providing more services and solutions to our members.”
"Joining forces with HAPO Community Credit Union represents an exciting and transformative milestone for both our clients and our dedicated team,” said Community First Bank's CEO, Eric Pearson. “At Community First Bank, we’ve always placed the highest value on our relationships with our clients and commitment to our loyal team as well as our role in the community. This partnership allows us to elevate the services we provide while staying true to our core values of transparency, trust, and a client-first approach. Together, we are creating a stronger future, delivering unmatched financial solutions, more opportunities for our employees, and deepening our commitment to the communities we serve."
Michael Bell
HAPO Community Credit Union was advised in this transaction by ALM First Analytics, LLC, as exclusive financial advisor, and Honigman, LLP, as legal counsel.
Prediction Coming True
The pioneer of CU purchases of banks, Michael Bell, commented on the record-setting season.
“The pace in this record-setting year is not slowing,” said Bell, a partner and chair of the Financial Institutions Practice Group at Honigman, LLP. “I forecast early this year that the number of these agreements will top 20, and we are closing in on that.”
Bell has been part of more than 60 whole-bank agreements, plus additional bank branch purchases.
Pace Heats Up Bank Attacks On Deals
The pace of credit union purchases of banks has also heated up bank trade groups’ opposition to the agreements. Independent Community Bankers of America President and CEO Rebeca Romero recently pointed out that credit unions have accounted for “roughly a quarter” of this year’s banking industry acquisitions, and again called for Congress to investigate whether credit unions should be able to acquire banks given their tax and regulatory exemptions.