Two Seattle credit unions, the $228 million Prevail Credit Unionand the ailing $32 million Transportation Northwest CU arepreparing for an August merger, it was announced this week.

Under a preliminary agreement subject to approval of regulatorsand members, Transportation Northwest will retain its name as adivision of the surviving Prevail, which combined will have 22,500members and 10 branches. The consolidated CU will serve members inthree metro Seattle counties: King, Pierce and Snohomish.

Transportation, which had large losses in its real estateportfolio in 2009 and a 14% delinquency rate, had approachedPrevail as a potential partner last February "considering ourmembership profiles of government employees were very much incommon," said Thomas Graves, president/CEO of Prevail.