Two New Hampshire credit unions, the $720 million Northeast Credit Union of Portsmouth and the $112 million Woodlands CU of Berlin, announced Tuesday an intent to merge by yearend.
The proposed consolidation has been in the talking stage for six months and would combine two healthy credit unions to forge the state’s second largest with 15 branches and more than 84,000 members.
Peter Kavalauskas, president/CEO of Northeast, said the planned consolidation – still subject to approval of state regulators and Woodlands members – would allow Woodlands to reduce its compliance and consumer regulatory burden and offer a higher level of online products on a more cost-efficient basis.
“Like many credit unions of its size, Woodlands has struggled to provide its members economies of scale when it comes to offering advanced products like bill pay or mobile services and so this merger would serve to aid that effort,” said Kavalauskas.
Moreover, Northeast will be able to provide broadened business lending and investment products to the 16,000 members of Woodlands in both Maine and New Hampshire.
Kavalauskas said for years Northeast has assisted Woodlands in its indirect loan operation through a wholly owned CUSO, Indirect Auto Solutions, and the merger would enhance that program. Northeast also has a partnership with CUDL operating what Kavalauskas called a front end platform.
The formal merger announcement said the consolidation would “create a healthier and stronger financial cooperative for members of both organizations. This agreement is the first formal step in the process.”
“We explored many options and a partnership with Northeast Credit Union was the best strategic alternative for us, and also a great opportunity for our members,” said Timothy Collia, CEO of Woodlands. “Both Woodlands and Northeast have a long and storied tradition of providing exceptional personalized service to our members.”
Northeast said Collia would become executive vice president and chief operating officer. Also under the consolidation, Northeast would be the surviving brand.