Calling his purchase "the largest that I know of between a credit union and a bank and an outstanding deal for us" the president/CEO of the $1 billion Royal Credit Union of Eau Claire, Wis. forecast the buyout of 11 AnchorBank branches including the addition of 114 employees will take 18 months to complete.
"I think the real news is that for the first time we will be introducing a credit union into communities that have only known banking services and that seems a pretty strong plus for credit unions," said Charles Grossklaus, the Royal CU head.
He was referring to western Wisconsin communities, which formerly housed offices of a now merged, and former family-owned bank, S&C Bank of New Richmond. S&C was bought out two years ago byAnchorBank of Madison, which is now under regulatory supervision after large loan losses.
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Knowing Anchor was under financial stress, Grossklaus said he approached its management several months ago about selling the branches and they said yes. Grossklaus said Royal with 9.76 capital and .53 ROA is well positioned to handle the transaction and has been one of the Midwest CUs frequently hit on by NCUA to join the bidding for troubled CUs in the sand states.
"I think we get called once a month by NCUA and in my 38 years I don't ever remember that happening," said Grossklaus who said his CU will now have his hands full undertaking the daunting task of completing the Anchor conversion. Once finished, Royal will have 26 branches, 23 across central and western Wisconsin and three in the Twin Cities metro area, serving more than 140,000 members.
Grossklaus is a former chairman of the National Association of Credit Union Supervisors and of the Wisconsin Credit Union League.
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