The NCUA said it approved 17 mergers in 13 states in August, bringing the total number of approved mergers to 172 so far this year.
The August merger number is lower than August 2012 when the NCUA approved 24 mergers, according to the agency’s monthly Insurance Activity Report. This year’s August merger number is also lower than the 23 mergers in July and the 19 mergers June that were approved by the NCUA, the agency said.
Fourteen credit unions with less than $50 million in assets and one with $60 million in assets were merged out of existence, the report showed. California, Virginia, North Carolina and Utah each had two mergers.
Though NCUA approved the merger of two credit unions with more than $100 million in assets, one of those merger agreements had been cancelled, according to the agency.
The $139 million USU Charter Federal Credit Union in Logan, Utah, merged with the $849 million Goldenwest Federal Credit Union in Ogden, Utah. The combined credit union will manage assets of nearly $1 billion and serve more than 106,000 members.
The NCUA had approved the $168 million ICON Credit Union in Boise, Idaho, to merge with the $487 million Connexus Credit Union in Wausau, Wis. Despite the approval, the merger was called off, Connie Miller, president/CEO of ICON CU, told Credit Union Times Wednesday.
Meanwhile, 13 of the small credit unions merged with larger counterparts to expand services to members, while two credit unions consolidated because they were in poor financial condition, the NCUA said. One credit union merged because of lack of growth and one consolidated due to the inability to obtain officials, according to the NCUA report.
The $9.1 million, 3,077-member Westco Federal Credit Union in Greensburg, Pa., which merged citing poor financial conditions, posted a net worth of 6.49% in 2012, far below the peer average of 14.65%, according to NCUA financial performance reports.
From 2008 to 2012, Westco FCU posted declines in loan, fee and investment income, NCUA financial performance reports showed. The cooperative recorded a net income gain of $34,889 in 2008, but posted net income losses of $108,859 in 2009 and $93,361 in 2010. In 2011 and 2012, the credit union had net income gains of $41,161 in 2011 and $25,618 in 2012, according to NCUA data. Westco is expected to merge with the $54 million, 10,222-member Westmoreland Community Federal Credit Union also in Greensburg.
Poor financial conditions forced the tiny $40,946, 210-member St. John’s Ame Birmingham Federal Credit Union in Birmingham, Ala., to merge with the $131 million, 18,770-member Alabama Central Credit Union also in Birmingham, the NCUA report noted. St. John’s Ame Birmingham CU had declines in loan, fee and investment income as well as net income losses from 2008 to 2012.
The $19.7 million A M Federal Credit Union in Gardena, Calif., cited lack of growth for its reason to merge with the $366 million Skyone Federal Credit Union in Hawthorne, Calif.
In 2003, A M Credit Union was serving 8,216 members but that number dropped to 4,679 members by June 2013. Skyone FCU serves 28,008 members.
A M Credit Union’s lack of growth in membership resulted in reductions in loan, fee and investment income from 2008 to 2012. In those same years, the cooperative posted total net income losses of more than $2.4 million, its NCUA financial performance report showed.
An inability to find a qualified president/CEO compelled the $2 million, 641-member North Andover Municipal Federal Credit Union in North Andover, Mass., to merge with the $22 million, 2,787-member Andover Credit Union in Andover, Mass., the report revealed.
Other mergers of note included:
- the $17 million, 2,484-member Rome Credit Union in Royal Oak, Mich., with the $495 million, 50,479-member Community Choice Credit Union in Farmington Hills, Mich.
- the $60 million, 10,927-member United Services Credit Union of Asheville, N.C., into the $583 million, 40,111-member Self-Help Credit Union in Durham, N.C.
- the $4.2 million, 433-member Asheville Postal Credit Union in Asheville, N.C., into the $2 billion, 106,520-member Atlanta Postal Credit Union in Atlanta.