Maryland’s financial regulator and the FDIC have approved the purchase of Advance Mutual Savings Bank in Baltimore by Municipal Employees Credit Union of Baltimore.
Mark Kaufman, Maryland's commissioner of financial regulation, issued the approval statement Thursday. The FDIC approved the acquisition Wednesday, according to Marianne E. Roche, a Washington attorney representing Advance Bank.
The $1.2 billion, 103,642-member MECU received NCUA approval Oct.15 to acquire the $61 million Advance Bank. In addition, the OCC also has approved the acquisition that was initially announced in April.
Securing all of the regulatory approvals will allow the 3,500 Advance Bank members to vote on the acquisition. Previously Bert Hash, president/CEO of MECU, said the vote is expected to be held in November.
If Advance Bank members approve the acquisition, it should be finalized at the end of the year.
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.
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 for Advance members to become MECU members.
However, for the one-third of Advance’s customers who don’t already 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 MECU members, Hash said.
MECU’s first bank acquisition is part of what appears to be 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., acquiring Griffith Savings Bank; the $2.1 billion Landmark Credit Union in New Berlin, Wis., purchasing the $190 million Hartford Savings Bank, and the $352 million GFA Federal Credit Union of Gardner, Mass., buying Monadnock Community Bank.