Fifteen months since two of Michigan's largest creditunions combined to form the $1.6 billion Lake Trust Credit Union,the Lansing-based CU said it was making plans for its firstmerger of a struggling Detroit CU, the $7 million Father Kramer CUof Center Line.

“Sure, in the days ahead we could be receiving more of theseinquiries from small credit unions in Michigan that find it toughgoing but this is one we've been in discussions since lastJanuary,” explained Stephan L. Winninger, CEO of Lake Trust, whichitself was formed by a major merger of its own which the formerNuUnion and Detroit Edison credit unions completed in April2010.

Father Kramer, formed in 1949, has about 1,500 members from theKnights of Columbus Father Kramer Chapter in the Detroit suburb andsaid it sought out Lake Trust as a favored partner as it dealt witha depressed economy.

“It's become increasingly difficult to manage our credit unionin the face of this challenging economy,” said Father Kramer CUBoard Chairman Arnie Lesner.

Economic factors have “depressed our earnings and we'vecontinued to see our assets decline, both of which have limited ourofferings to our members,” said Lesner. The CU lost nearly $99,000last year followed by a $21,000 loss in the first quarter, but itsnet worth ratios have remained high.

As it has concentrated during the past year on completing theNuUnion/Detroit Edison merger, Lake Trust, said Winninger, has notbeen actively soliciting prospects but on performance, “I think itwas a surprise to us and others that we've done so well in managingthe transition and earning profit in nine of the last 11 months,”said Winninger. “That has put us way ahead of our plans.”

Meanwhile, Lake Trust is currently scouting for a new CEO toreplace Winninger, who at 65 is retiring at the end of the year.Leaving Lake Trust at the same time will be its president, WilliamThiess, the former CEO of Detroit Edison.

Winninger said he expects the Lake Trust board to pick a new CEO“some time in the fourth quarter.”

Regarding Father Kramer, the merger deal is subject toregulatory and membership approval.

In a statement, Father Kramer officials said the merger wouldallow its members to “gain access to additional competitivelypriced savings and loan products like CDs, IRAs, mortgages, homeequity loans and credit cards, as well as phone banking, Internetbanking and bill payer products.”