Both credit unions hold community charters. Yakima Valley, with 30,300 members, was founded in 1939 as the Fireman's Credit Union and later absorbed county employees. Meanwhile, Catholic was chartered in 1951 as a faith-based CU and now has 18,000 members.

“I do remember the days when as CEOs, we would call each other up to kid about which credit union was larger or who was doing the leap frogging,” recalled Regimbal, pointing to the rivalry with Worthington's predecessor CEO, Earl Weatherman.

The razzing may have been a sidelight, but the staff sharing was pervasive, ongoing and productive and maybe slightly extraordinary among financial competitors.

“Representing both of our credit unions, we had our monthly managers' breakfast where we included our branch managers and also invited top staff from the five other smaller unions in the Valley to discuss ad campaigns, business practices, policies, procedures and new members,” said Regimbal, stressing that his CU had become quite knowledgeable about Yakima Valley operations.

In bygone days, Catholic would even “send some of its members to Yakima Valley since they had checking accounts, and they would in turn send their members to us for better certificate rates,” remembers Regimbal.

While “there was always casual discussion over the last 10 years” about a merger, each CU was looking out for its own interest, eyeing potential and smaller partners in the Yakima market, said Regimbal.

It was only in 2003-2004 when times were good that the Catholic board began to conduct strategic discussions regarding the pros and cons of a merger, said Regimbal.

“But there never was an urgent issue to merge and since both credit unions were well-capitalized [in the 12% to 16% range] and healthy, why the rush?” asked Regimbal, who will retire next June at 63. Until then he will become senior vice president of corporate integration.

It was not until the 2008 recession and the subsequent housing collapse gripped central Washington that merger talk moved to the front burner, said Regimbal and Worthington.

“It was about in the spring of 2009, about a year after I took over the CEO job at YVCU that Paul mentioned the talk of a merger between the two shops had been going on for several years,” said Worthington.

The Yakima Valley CEO said she let him know that she would start discussions with her board.

But Worthington said she didn't approach her board with a plan to discuss the specifics of a merger with CCU. “This was a rather important topic that required extensive research and study and that had to come from various angles, over the course of several months, bringing new ideas and discussion points to the board at each meeting,” said Worthington. Eventually, D. Hilton Associates of Dallas was hired.

She said directors talked about merging a small credit union or several small credit unions into YVCU, and they talked about merging YVCU into a much larger credit union.

Finally, she recalled, the discussion with the YVCU board came down to what issues were nonnegotiable under a merger with Catholic or another CU. They included a favorable name and preserving existing management.

“Once the board came down to only a few items,” Worthington said, she knew she was ready to work with Regimbal to craft a merger scenario.

As part of the project, both Regimbal and Worthington attended each other's board meetings “so that board members could get to know each CEO and ask questions and discuss issues,” said Worthington.

There were plenty of probing questions from directors, but the reaction was totally positive, recalled Worthington.

One of the most sensitive was the makeup of the new management of a merged CU. But that Regimbal told Credit Union Times was never an issue in his mind. Fresh management and one CEO was needed to run a combined organization, he said.

The overall merger discussions with directors do indeed take time and cannot happen in one meeting, said Worthington, adding that getting a handle on each director's personal view or agenda was vital.

“Just because a board member is quiet or does not bring up any issues does not mean there aren't any there, under the surface,” cautioned Worthington. She said it was important to create an environment where conversation could be free flowing.

Regimbal said that was equally important at his own shop as the merger idea began to percolate, commonality came into view. “We found that we had 37% member overlap at Yakima Valley,” a number he considered high.

Under the merger, no layoffs are planned among the 145 employees.  “As Paul and I worked through the management ranks and the restructuring, we did find new jobs for individuals,” said Worthington. “We knew, for example, we could not have two vice presidents of marketing.”

As for the new name, “Solarity,” Worthington said the brand was chosen to represent “energy–the liveliness of our people and the vigor that we have put into the communities we serve.”

The Solarity message is that the CU “will illuminate a path for our members to thrive,” Worthington concluded.