The $385 million First South Financial Credit Union of Bartlett, Tenn., is adding to its Memphis-area footprint by merging the $12 million Dyersburg CU.
The merger is expected to be completed by Nov. 30.
First South said the merger decision by the Dyersburg board was prompted by its need to become a full-service institution.
Negotiations had been under way for months, with Dyersburg approaching First South on the consolidation. The Dyersburg CU, which had been profitable in 2010 and through the first half, had found the regulatory workload overwhelming, said a spokeswoman.
Craig Esrael, president/CEO of the 50,000-member First South, stressed that CU mergers are complicated these days and on Dyersburg “the bulk of the remaining work will be in converting loans, credit and debit cards.” He noted also that no layoffs are planned.
The merger will give First South its 15th location serving members in Shelby, Tipton, Fayette, Madison and Dyer counties in Tennessee and Tunica, Tate, Marshall and Desoto counties in Mississippi.
In a letter to members, Esrael attributed the merger to the financial crisis of 2008, “which brought the recession and sweeping regulatory changes that have dramatically affected CU operations.”
“These new rules and regulations have been challenging for all financial institutions to implement, but the burden is even greater on small credit unions, who may not have the time or resources necessary to make these major changes,” said Esrael.