Declining deposits and loans, stagnant membership growth and insufficient resources to invest in new technologies has led the board of directors of the $85 million Chevron West Credit Union in Bountiful, Utah, to unanimously approve a merger agreement with the $2.2 billion Chevron Federal Credit Union in Oakland, Calif.
In a statement to its 5,858 members, Chevron West said “increasingly extensive regulations, rising compliance and security costs, and shrinking interest rate margins have made it difficult” for the credit union to fulfill its mission.
In addition to declining loan income revenue, Chevron West also has seen its net income drop from $1.1 million in 2010 to $480,474 in 2012, according to NCUA financial performance reports.
Pending regulatory and membership approvals, the merger is expected to be completed by October, the credit unions said.
Chevron West’s 13 employees will continue to work for Chevron FCU and there will be no closings of Chevron West’s three locations in Denver, Salt Lake City and Bountiful, the credit unions said.
This merger agreement is Chevron FCU’s second since the $175 million Spectrum FCU in San Francisco consolidated into Chevron FCU in March 2012.
Chevron West was founded in 1950 as the Standard Credit Union to serve the financial needs of employees at the Chevron refinery in North Salt Lake, Utah. That refinery was part of Chevron West Oil, the Mountain West division of Standard Oil of California. The credit union changed its name to Chevron West in 1974.