Three Mergers in Two Months for Credit Union of Southern California
Credit Union of Southern California has announced that it has completed mergers with three smaller, local credit unions in a 63-day span.
“All three were well-capitalized institutions. They decided they wanted to merge with us because they wanted to offer more services to their members,” said Dave Gunderson, CEO of Credit Union of Southern California, in an interview. “One did not offer home banking. None had Saturday hours. We offer all of that and more.”
Gunderson stressed that all staff were retained in the mergers. “After the merger, operationally we gain economies of scale. We will have greater efficiencies. And some employees will leave by their own choice.”
Inland Empire CU, based in Pomona, Calif., has $40 million in assets. North Orange County CU, headquartered in Fullerton, Calif., has assets of $57 million. And Family 1 FCU, based in Placentia, Calif., holds $26 million in assets. Credit Union of Southern California now has assets totaling $577 million.
Rick Hoffman, who had been CEO of Inland Empire Credit Union and who now serves Credit Union of Southern California as vice president of business development and legislative affairs, added, “We did the merger because we felt we could get more value for our members. We did not have the staff to get out and do business development, for instance. Now, I am doing that as my main responsibility. And I can say we now have a lot more traffic through our lobby.”
Gunderson stressed that a key to what he called a smooth integration of the three merged institutions is Credit Union of Southern California’s expertise in information technology. He elaborated that the institution also operates CU SoCal Partners, a Brea-based IT consultancy that works with a range of small to mid-sized credit unions to achieve greater efficiencies.
“We have built a team that understand a credit union’s IT and that has helped us more smoothly integrate operations,” added Ray Rounds, a senior vice president for IT at Credit Union of Southern California.
Credit Union of Southern California came into this round of mergers with significant prior experience. In 2009, it merged with WestWorksCredit Union, a $70 million, Alhambra, Calif.-based institution.
In 2003, it merged with City of Industry, Calif.-based Western Gear Federal Credit Union and also with Walnut, Calif.-based San Gabriel Valley Credit Union.
As for whether he envisions additional mergers, Gunderson said, “We are open to discussion with other credit unions about ways to provide more value to members and merger is one of those ways.”
He stressed, however, that “although smaller credit unions face great regulatory burdens, many serve important niches. I don’t see merger as an inevitability for them.”