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OMAHA, Neb. – And then there were 33. By a 54 to 1 vote, Nebraska credit unions overwhelmingly approved the SunCorp/Nebraska Corporate Central FCU merger, bringing the number of corporates to 33. (However, another merger is pending. See page 1) This merger vote was expected to be a slam dunk when the deal was announced in May, but some intrigue was added when Missouri Corporate CU President/CEO Dennis DeGroodt proposed the concept of creating a Midwest corporate consisting of six corporates – Kansas Corporate CU, Nebraska Corporate Central FCU, Iowa League Corporate Central CU, Minnesota Corporate FCU, Midwest Corporate FCU and Treasure State Corporate CU. While DeGroodt said the proposal wasn’t intended to derail the SunCorp/Nebraska Corporate Central FCU merger, he was asking Nebraska CUs to reevaulate the deal based on the concept of a regional Midwest corporate. Looking at the vote results, the concept didn’t hold much water for Nebraska CUs at this time. “I think the members have spoken, that’s obviously what they want to do. They have to do what’s best for them, and they’ve done that,” said DeGroodt. SunCorp Corporate CU President/CEO Eric Kenealy noted the high turnout as a statement by Nebraska CUs. With 55 of 83 CUs turning out to vote, it was one of the highest participation percentages for any corporate CU merger. DeGroodt is optimistic that a Midwest regional corporate can still be formed. Leaders representing some of the corporates involved in the proposal have already met twice, and are scheduled to meet a third time in the near future. “We’re still discussing the concept and the issues around the concept. I’d rather have the process go slow and do it right, than rush it. I’m still optimistic that we’re going to form a regional corporate,” said DeGroodt. As for the SunCorp/Nebraska Corporate deal, it became official on Oct. 31 with the data processing conversion scheduled for November. It creates a $2.2 billion corporate serving 536 CUs primarily in Colorado, Nebraska, Utah, Wyoming and Idaho. “We feel the two cultures will join together very well. Our working relationship has been very good, and we are especially eager to provide our Nebraska credit unions with Internet-based services to help them conduct transactions more efficiently,” said Mike Keim, CEO of Nebraska Corporate Central FCU. Nebraska CUs are expected to benefit through expanded investment products, better rates and more correspondent services, while SunCorp’s CUs are getting some CUSO innovation. Though small at about $150 million in assets, Nebraska Corporate Central FCU did have an innovative CUSO presence that featured member relationship and mortgage processing solutions. “We’re going to be evaluating those products. They have a number of neat services that we don’t offer our members. We can possibly roll them out to our members in other states,” said Kenealy. Based on a survey of Nebraska CUs, Kenealy hopes SunCorp can double the business that Nebraska CUs were giving to Nebraska Corporate. To that end, SunCorp will keep Nebraska Corporate’s former headquarters open as a regional service center, and the seven existing employees will stay in place. Keim will transition to an SVP of SunCorp, managing the Nebraska region The SunCorp name will be retained. This is the second merger in 18 months for SunCorp. It merged with Rocky Mountain Corporate in 2001. Kenealy believes that corporates need economies of scale these days to stay competitive. With this deal, SunCorp is a true regional corporate, said Kenealy. “I’d say we’re a Rocky Mountain/Great Plains corporate. This really diversifies our membership. Having that kind of regional diversification looks good to rating agencies,” said Kenealy. One of DeGroodt’s reasons for wanting to create a Midwest regional corporate was so that Midwest corporates have a voice through board of director representation. He feared that if Midwest corporates get picked off by out-of-region corporates, they will lose a voice. Kenealy said that won’t be the case in this merger. “Our board believes in proportionate representation. That includes both geographically and by asset size of the members. We have board members from each state and members from each asset class. Everyone has a voice,” said Kenealy. The new SunCorp board will have 10 board members, with one member representing Nebraska. However, another five Nebraska CUs will be represented on various committees of the SunCorp Board. [email protected]

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