Citing a “strength in numbers” strategy, two Rhode Island credit unions, the $44 million Alliance Blackstone Valley FCU and the $43 million Blackstone River FCU have won NCUA clearance to merge effective Sept. 30.
“Our boards felt that in this kind of challenging economy and with the many compliance hurdles coming our way, our best strategy for two healthy credit unions was to combine,” explained Joseph J. Cicione III, president/CEO of Alliance Blackstone Valley of Pawtucket.
Discussions on a merger with Blackstone River of Woonsocket began in earnest last December though the concept has been considered for some time, said Cicione who becomes head of the combined three-branch CU. James Wood, CEO of Blackstone River will become executive vice president.
Cicione said both CUs could have sought out mergers with larger Providence CUs “but our board felt it was ready to take on any curve balls thrown our way and as a combined CU we could hit a home run.”
Besides, he said, the merging of small CUs into larger brethren has one big disadvantage: the face to face relationship with members is lost, said Cicione “and we decided we did not want that to happen.”
Cicione said the merger will expand the CU membership to 8,700 and allow it to serve all of Providence County. Both CUs have managed satisfactorily during the recession with Alliance at 12% net worth and Blackstone at 9%, he said.
The two credit unions have similar histories, both involving teachers. Alliance Blackstone Valley, in business since 1948, began serving employees of the Pawtucket School Department, while Blackstone River was chartered in 1961 by members of the Woonsocket Teachers Union.
“This is an extremely positive move,” Cicione said. “We're two very strong institutions, which is important to consider, especially with the economy being the way it is.”
He added that such a merger is a “pro-active” business move. “We'll see more of this in this economy,” Cicione said.