Thank you for sharing!

Your article was successfully shared with the contacts you provided.

VICTORIA, Australia – With the goal of achieving greater economies of scale, Members Australia Credit Union (MACU), a 45-year old credit union, is in the process of merging with Education Credit Union (ECU). ECU was established 29 years ago. If the expected merger goes through, the combined credit unions will become one of Australia’s largest with 114,000 members and gross assets of AUS$923 million ( US $511 million). The main reason behind the merger is to allow both organizations to respond to the highly competitive Australian banking environment. The board of directors of both credit unions have unanimously recommended approval to their collective members. A vote will take place November 28 at a special general meeting, but early member reaction has been positive. A series of information sessions are being held in five different cities to answer member questions. There are telephone numbers for people to call with their questions if they cannot get to a session. Members are encouraged to appoint a proxy to vote if they cannot attend the November 28th meeting. The merger also must be approved by the Australian Prudential Regulation Authority (APRA). APRA is the government agency that supervises banks, credit unions, building societies, friendly societies, life offices, general insurance and superannuation funds. If all the approvals go through the merged credit union could begin doing business as of Jan. 1, 2003. Because there are no duplication of locations, the two credit unions do not anticipate branch closures. Members Australia CU and Education CU share strong industrial bonds with significant community bonds and have similar vision, mission and core values. It is expected some managerial staff will be redundant and voluntary resignations will be asked for before people are let go. According to Phylip Doughty, ECU CEO, the merger will bring immediate benefits. He cited, “an alignment of interest rates and fees, coupled with enhanced banking, personal risk management, wealth creation and wealth management services” as being the primary advantages. Doughty also pointed out the new credit union will offer “substantial financial strength and security with 114,000 members and gross assets of AUS $923 million, representing the largest credit union with its registered office in Victoria.” The merger will also give members an expanded service centre network. Mergers are not new to either credit union. Both have grown through mergers in the past. ECU started out serving Victorian secondary school teachers. Through strategic mergers, it now serves the entire staff in the education sector as well as people living or working in Kew, Doncaster and Burwood and Monash University. It also serves the staff of Kraft Foods. Australian credit unions are no longer bound by common bond requirements, but tend to serve people related to their original bonds. MACU likewise has merged with other smaller credit unions or chosen to service a variety of groups. Their last merger was in November 2001 with APESMA Professionals First Credit Union. It was John Hope, Ansett Transport Industries Personnel Manager, who originally inspired the establishment of a staff credit union that became Outlook Credit Union in 1972. In 1998 a merger between Outlook, Sirocredit and Enterprise credit unions led to the creation of Members Australia. It then expanded to cover other aviation workers as well as workers at CSIRO Marine Laboratories. It also served the newspaper industry when Media Credit Union joined Outlook. Brendan Smith is the current CEO. “If the merger is approved, the new board will have eight directors made up of four current Members Australia Credit Union Directors and four current Education Credit Union Directors,” Doughty said. Redundant directors will receive a payment. Unlike in the U.S., Australian board members are often compensated. Doughty is the current CEO of ECU and will assume the same role for the merged credit unions. He expects to have a few problems with different staff cultures, which is a normal outcome of any merger. However, the work to this point hasnot produced any major upheavals. According to Doughty, “The process that has led to this agreement has been thorough. Directors and management from both credit unions have undertaken a great deal of work in a short period of time. A Board Working Party comprising two directors and the chief executive from each credit union has led the appraisal of information and overall evaluation process. The Board Working Party has been supported by a Merger Evaluation Group, a team of managers from both credit unions. A key function of the evaluation process has been the commissioning of a thorough due diligence on both credit unions conducted by independent, external professional organizations.” -

Complete your profile to continue reading and get FREE access to CUTimes.com, part of your ALM digital membership.

Your access to unlimited CUTimes.com content isn’t changing.
Once you are an ALM digital member, you’ll receive:

  • Critical CUTimes.com information including comprehensive product and service provider listings via the Marketplace Directory, CU Careers, resources from industry leaders, webcasts, and breaking news, analysis and more with our informative Newsletters.
  • Exclusive discounts on ALM and CU Times events.
  • Access to other award-winning ALM websites including Law.com and GlobeSt.com.

Already have an account?


Credit Union Times

Join Credit Union Times

Don’t miss crucial strategic and tactical information necessary to run your institution and better serve your members. Join Credit Union Times now!

  • Free unlimited access to Credit Union Times' trusted and independent team of experts for extensive industry news, conference coverage, people features, statistical analysis, and regulation and technology updates.
  • Exclusive discounts on ALM and Credit Union Times events.
  • Access to other award-winning ALM websites including TreasuryandRisk.com and Law.com.

Already have an account? Sign In Now
Join Credit Union Times
Live Chat

Copyright © 2022 ALM Media Properties, LLC. All Rights Reserved.