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TAMPA, Fla. — Do unsolicited mergers have a place in the credit union industry particularly for those that are struggling and would welcome the opportunity to merge to stay competitive? The industry frenzy created by the unprecedented way $1.6 billion Wings Financial Federal Credit Union has pursued $182 million Continental Federal Credit Union has led to some credit unions quietly wishing the Apple Valley, Minn.-based Wings Financial would consider them for a merger. Some have disagreed with the approach and tactics Wings Financial has used, which include soliciting Continental’s members to ask Continental’s board for a vote through a petition and repeated attempts seeking to merge, but beyond the emotion of it all, are hard and immediate strategies needed by some credit unions to survive.

Most are reluctant to speak about the sensitive topic on record. Still, mergers certainly have their place in the industry, but it really depends on the motives behind who’s buying or selling, said Bucky Sebastian, president/CEO of $2.1 billion GTE Federal Credit Union and spokesman for the National Center for Members Trust, an entity that provides legal assistance and support to members who wish to challenge the conversion of their credit unions to banks. “The truth is in the cost of delivering quality service to a field of membership based on costs of technology, personnel and compliance,” Sebastian said. “The days of volunteers and mom and pop are numbered.” With that said, Sebastian emphasized that the way Wings Financial is going after Continental has not been “the best approach.” “We’re a cooperative movement. We’re not an aggressive, combative movement,” he said. “If you approach someone with a merger and they rebuke it, that should be it.” Sebastian said if anything, the Wings/Continental matter has sent a wake-up call. The co-founder of Callahan & Associates, who also served as executive director and general counsel at NCUA in the 1980s, recalls the demise of the savings and loan industry and can’t help worrying about those credit unions that have become complacent.

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