Tuesday, January 22, 2019

Two Large Educational CUs Will Merge to Create $17 Billion CU

Two large California credit unions serving the educational community to merge creating a $17 billion credit union.

SchoolsFirst Federal Credit Union (Santa Ana, CA) and Schools Financial Credit Union (Sacramento, CA) on January 22 announced that the two credit unions have reached a tentative agreement to merge.

SchoolFirst FCU has more than $15.2 billion in assets and 50 branches. SchoolFirst has a field of membership serving the educational community throughout California.

Schools Financial CU has $1.9 billion in assets and 11 branches.

The merger will require the approval of School Finacial's members and regulators. If approved, the merger is expected to close before the end of this year.

Read more.

10 CUs Repay CDCI Investments in 2018

During 2018, 10 credit unions fully repaid investments from the Community Development Capital Initiative (CDCI) under the United States Department of Treasury's Troubled Asset Relief (TARP) program.

Below is the list of credit unions that repaid their CDCI investment and the amount of the repayment.

As of the end of 2018, there are 8 remaining CDCI financial institutions, of which 6 are credit unions.

Saturday, January 19, 2019

They Have Expensive Taste

The Washington Post is reporting on the expensive taste of National Credit Union Administration (NCUA) Chairman J. Mark McWatters and his chief of staff Sarah Vega.

According to the story, this information would have never seen the light of day except for a whistleblower complaint to the agency's inspector general about the extravagant spending by Mcwatters and Vega.

For example, the agency paid $250 for an UberBlack ride from Washington, D.C. to Alexandria.

The agency has decided that McWatters can no longer use UberBlack, but only regular Uber. This caused McWatters to lament: “I’m schlepping around in somebody’s Civic.”

The article also noted a fondness for wine and top-shelf liquor and pricey meals.

A recently retired assistant inspector general stated that "there was a sense of entitlement."

While these expenditures are lavish, they are permitted by the agency's rules.

As John Kutchey, deputy executive director of the NCUA, explained to agency investigators, "They have expensive taste."

Read the story (subscription required).

Friday, January 18, 2019

Ent CU to Build 300,000 Square Foot HQ Building

Ent Credit Union (Colorado Springs, CO) announced that it will start construction on its new corporate headquarters this summer.

Ent Credit Union will build a 300,000 square-foot building.

The credit union plans to build an adjacent parking garage to accommodate its workforce of about 500.

The new headquarters building will house Ent’s call center, consumer and mortgage lending, information technology, finance and accounting, human resources, member services, administration and the executive team.

The $5.6 billion credit union expects to move into its new headquarters building in 2021.

The cost of the project was not disclosed.

Read the story.

Thursday, January 17, 2019

Dubuque Proposes Tax Increment Financing Rebate for Dupaco Community CU's Development Project

The City of Dubuque, Iowa has proposed tax incentives for the development of a property located at 1000 Jackson Street in the Historic Millwork District by Dupaco Community Credit Union.

Under the proposed agreement, the credit union will make a $38 million capital investment in the 82,800 square foot facility, which will serve as the credit union's headquarters.

The credit union will occupy the top three floors of the building and prepare the rest of the building for commercial tenants.

Dupaco Community Credit Union will retain its current 150 employees in Dubuque and add at least 40 full-time employees employees to its Dubuque operations by October 1, 2023.

As part of the agreement, the city will provide an Urban Renewal Tax Increment Revenue Obligation for 15 years of Tax Increment Financing rebates of property tax increases, which is not expected to exceed $2 million.

The credit union is also requesting state incentives for the project.

A hearing on the project is scheduled for January 22, 2019.

Read the documents.

Tuesday, January 15, 2019

Vystar CU to Acquire Florida Community Bank

VyStar Credit Union (Jacksonville, FL) announced it has signed an Agreement and Plan of Merger to acquire Citizens State Bank (Perry, FL).

Citizens State Bank has four branches and over $280 million in assets.

Vystar Credit Union has more than $8.2 billion in assets and serves 49 counties in Central and North Florida and 4 counties in Georgia.

The transaction is expected to close midyear, and it is subject to standard closing conditions and Citizens State Bank shareholder and regulatory agency approvals.

The price of the transaction was not disclosed.

Read more.

NCUA Needs to Improve Emergency Merger Transparency

The National Credit Union Administration (NCUA) needs to improve transparency with regard to emergency merger process.

I am not the only one who believes there is a need for greater transparency.

In fact, the National Association of Federally-Insured Credit Unions (NAFCU) in a 2018 comment letter called on NCUA to increase its transparency with regard to the emergency merger process.

NAFCU wrote:

As part of this process, prospective merger partners should be fully apprised of important information regarding the selection process and should also have the opportunity to make their case for the merger. Additionally, the NCUA should provide prospective merger partners with a written explanation of the reasons for its decision. This would help increase transparency in the entire emergency merger process and help guide future emergency mergers.

For example, how did NCUA select Pentagon Federal Credit Union (McLean, VA) as the emergency merger partner for Progressive Credit Union (New York, NY), which was in danger of insolvency?

CU Today, a credit union trade publication, noted there were other credit unions that expressed interest in possibly acquiring Progressive. Why were these credit unions not selected, especially if they were headquartered in New York?

The agency's Inspector General should evaluate NCUA's emergency merger process and make recommendations on how to improve it and make it more transparent.

The Inspector General should also examine NCUA's decision to name Pentagon Federal Credit Union as the merger partner for Progressive.

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