Cowlitz Credit Union Intends to Merge Into Red Canoe
The $41 million Cowlitz Credit Union in Longview, Wash., plans to merge into the $581 million Red Canoe Credit Union, also based in Longview, by September, according to a Cowlitz CU prepared statement.
“It’s becoming increasingly difficult to keep up with new regulations and the fast-paced technological developments in our industry,” said Larry Anderson, Cowlitz board chair. “The board unanimously agreed that turning back to an old friend made the best sense for our membership.”
Like many small credit unions, revenues at Cowlitz had either been flat or declining.
Loan income has slightly fallen from $1.2 million in 2009 to $1.1 million in 2013, while in the same years, fee income also dropped moderately from $328,879 to $308,068, according to NCUA financial performance reports.
The cooperative’s investment income, however, has plummeted from $456,251 in 2009 to $140,105 in 2013.
Cowlitz CU was established in 1957 as Cowlitz County Employees Credit Union. During its early days, the credit union was managed by Red Canoe Credit Union (then known as Weyerhaeuser Credit Union), although the two credit unions kept their assets separate.
As Cowlitz grew, it hired a CEO to oversee operations, but Red Canoe “has always been a strong local partner and friend,” Anderson said.
“The consolidation of assets will result in more-efficient operations and capital management, which is a better use of our members’ money,” Anderson said. “Plus, we will be able to offer a wider array of products and services, including technology conveniences that can be cost-prohibitive for smaller credit unions to offer. Overall, this is a win-win for both credit unions.”
David Spaulding, Red Canoe’s president/CEO, said all 15 Cowlitz employees will keep their jobs and that Cowlitz also will keep one seat on Red Canoe’s board of directors.
“We are excited for the opportunity to serve the Cowlitz Credit Union membership,” Spaulding says. “It makes good sense for our organizations to come together to better serve both of our memberships as one financial cooperative.”
Cowlitz serves 4,500 members and Red Canoe serves more than 54,000 members.
An intent-to-merge application is being processed by the Washington’s Department of Financial Institutions. Following regulatory approval, Cowlitz members will vote on the proposed merger.
That vote is expected to take place this spring, said Amy Davis, Red Canoe’s vice president of marketing. If approved, the consolidation would be complete by September.