SCHENECTADY, N.Y. — There are two pressing issues confronting volunteers these days–how to deal with large-scale credit union mergers and the prospect of CUs being acquired by expansion-minded banks.
That's the view of two top CU chairmen involved in leadership of the National Association of Credit Union Chairmen slated to hold its annual conference Oct. 17-19 in Williamsburg, Va.
"The phenomenon of big credit unions merging with other large credit unions is something fairly new to all of us," observed Chuck Smith, the chairman of NACUC and of the $191 million First New York Federal Credit Union of Schenectady.
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The industry is well versed in witnessing small CUs being taken over by larger brethren for economies of scale and other reasons, but the question becomes now, "how we as volunteers deal with the bigger mergers in our area and what are the issues that become deal breakers?"
Meanwhile, David Gilbert, the former secretary of NAFCU and chairman of Aberdeen Proving Ground Federal Credit Union in Maryland, said volunteers "need to be well educated to insidious attempts by banks" to acquire CUs.
That is also a new trend or challenge that needs to be confronted through volunteer education, said Gilbert, who is currently a director of the Maryland/D.C. Credit Union Association.
The roundtable meetings at the NACUC conference at the Williamsburg Lodge, should lend to a "healthy discussion of such issues particularly when you consider the Continental situation," said Smith, referring to the hostile merger bid earlier this year by Wings Financial of Minneapolis to take over Continental Federal Credit Union in California.
"Boards need to know how to react and how to be prepared," said Smith, a point echoed by Gilbert who said he remains worried about aggressive banks eyeing CUs as merger candidates as well as CU-to-mutual bank
conversions.
"It is most important that chairmen have the knowledge of what's going on," said Gilbert.
As for Smith, the First New York chairman said while "it
hasn't always been on our radar" the phenomenon of big mergers is posing new challenges.
"It's really a hard issue to deal with," observed Smith noting the many benefits cited by combined operations. The latest in his market occurred earlier this year in upstate New York with the merger of Power Credit Union in Syracuse with Empire Federal Credit Union to form the $600 million Empower Credit Union.
Meanwhile, the campaign to bring more volunteers into top leadership jobs in trade groups continues with far more work to be done, said Gilbert noting the CUNA board "still has no volunteers." Gilbert for years has urged the NACUC leadership to encourage more volunteers to run for CUNA director elections.
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