In a merger underscoring compliance concerns of small credit unions, the $312 million Connexus Credit Union of Wausau, Wis., said it expects to complete the consolidation of the $3 million Wausau City Employees CU by June 1. The merger proposal was formally approved by WCECU members at its annual meeting last Thursday.
Though talks to complete the merger have been underway since December, the burden of complying with sometimes complex rules on Regulation E (courtesy pay), from the Office of Foreign Asset Control and Regulation Z has played a role in the merger, said David Christenson, Connexus president/CEO.
He added that many small CUs, like the 820-member WCECU, have struggled with paying the compliance bill and have sought out larger CUs like Connexus for help.
Even though WCECU broke even last year and suffered only a small loss in the first quarter, its CEO “was simply not ready to go on with this task,” Christenson said.
He added that Connexus has “a long-standing relationship” with WCECU, one of five small central Wisconsin CUs served by Connexus on mortgage products and other offerings.
Christenson said Connexus has no desire to merge any of its other small CU clients, but “stands ready to help as we have done all along.”
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