The prospect of more credit union mergers could generate more new business for consultants this year and is already flooding consultants with inquiries.
That was the word this week from two firms, Dollar Associates of Birmingham, Ala. and D. Hilton Associates of The Woodlands, Texas, which reported a record number of phone calls and e-mails from CEOs and board members seeking advice on partnering deals.
"When you consider the economic downturn, the challenging real estate market, the corporate losses and balance sheet income, there's little doubt the number of credit union mergers will accelerate over the next year," forecast Dennis Dollar, the former NCUA chairman and head of Dollar Associates.
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He noted a "dramatic" increase in inquiries in recent months and forecast that the number of mergers per business day will climb from one to two or three over the next 12 to 18 months. There's no question, he maintained that "regulators are having an impact on the merger trend."
Similarly, David Hilton of Hilton Associates, said his firm specializing in recruitment and CU governance, is fielding queries from CUs in California, Arizona, Nevada, Florida and Michigan, with a number under scrutiny of regulators as they seek out merger partners. At the same time, Hilton is getting inquiries from better situated CUs elsewhere asking about expansion prospects.
Some CUs have lost so much money they can't afford to stay in business any longer, he said, and just want to find an out-of-state partner with a comparable field of membership and charter.
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