Municipal Employees Credit Union of Baltimore President/CEO Bert Hash expects to receive final state and federal regulatory approvals soon that would allow MECU to complete its previously announced purchase of Advance Mutual Savings Bank also of Baltimore.
The $1.2 billion, 103,642-member MECU received NCUA’s approval Tuesday to acquire the $61 million, 3,500-member Advance Bank, said NCUA spokesperson John Fairbanks.
In addition, Hash said, OCC also has approved the acquisition that was initially announced in April.
No purchase price was released, but the deal calls for MECU to acquire all loans, investments, real estate, accrued interest receivables and other banking-related assets, as well as to assume all deposits, Federal Home Loan Bank advances, and accrued interest payable.
“We are waiting to hear from the state (Maryland Department of Labor, Licensing and Regulation) and the FDIC,” said Hash. “We hope that the approvals will be forthcoming and it’s been indicated that they are.”
Members of the Advance Bank also are required to approve the acquisition. That member vote may be held during the month of November.
Once the purchase is completed, 19 Advance Bank employees will continue to work for MECU, Hash said. Advance’s two branches will continue to operate as well.
Hash said more than two-thirds of Advance’s customers either live or work in the city of Baltimore, which makes them automatically eligible for MECU membership. MECU plans to pay the $5 membership fee to become members. For the one-third of Advance’s customers who don’t qualify to join the cooperative, MECU plans to pay their $5 fee to become members of the American Consumer Council, which would make them automatically eligible to become members of MECU, Hash said.
MECU’s first bank acquisition appears to represent an emerging trend in the credit union industry.
In September, the $255 million, 23,000-member Five Star Credit Union in Dothan, Ala., signed a definitive agreement to purchase the $21 million Flint River National Bank in Camilla, Ga.
Other similar deals that have been finalized over the past two years include the $1.5 billion United Federal Credit Union in St. Joseph, Mich., acquired Griffith Savings Bank, the $2.1 billion Landmark Credit Union in New Berlin, Wis., purchased the $190 million Hartford Savings Bank, and the $352 million GFA Federal Credit Union of Gardner, Mass., bought Monadnock Community Bank.