WESTMINSTER, Colo. — The $28 billion WesCorp, San Dimas, Calif. and the $4 billion SunCorp located here announced merger plans today.
SunCorp CEO Tom Graham told Credit Union Times that SunCorp evaluated a number of scenarios to survive and thrive in the future. For example, the corporate analyzed making more mergers and even selling parts of its business to become more efficient. SunCorp is no stranger to mergers. It completed two successful ones very close together with the corporates in Nebraska and Utah, but Graham said given the recent corporate consolidation, intense competition, and overall economies of scale a merger with WesCorp made the most sense.
Graham said SunCorp members can expect to realize $8 to $10 million in benefit from this merger.
SunCorp Chairman Mark Lau said at $4 billion SunCorp is almost stuck in the middle between too small to try and grow to match the larger corporates and too large to rely only on its existing marketplace to grow the business.
WesCorp of course is already involved in a merger with VolCorp out of Tennessee. WesCorp CEO Bob Siravo expects that merger to be complete by June 30.
Graham, who has only been with SunCorp for about two years after heading Kinecta FCU for many years, said he is committed to seeing this merger through.
Capital is always a question mark in corporate mergers. In this case, WesCorp will retain SunCorp's retained earnings in total and membership capital shares, while WesCorp will give SunCorp members the option to have their paid-in-capital paid out to them. SunCorp has $32.7 million in PIC.
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