Royal Credit Union will assume approximately $177 million in deposits and receive a corresponding amount in loans, real estate and other assets. The branches involved in the transaction are located in the Northwestern Wisconsin communities of Amery, Balsam Lake, Centuria, Menomonie, Milltown, New Richmond, Osceola, River Falls, St. Croix Falls, Somerset and Star Prairie. The depositors at these branches will become members of Royal Credit Union when the transaction is completed.
This deal is still awaiting regulatory approval from NCUA.
In my opinion, this transaction is a no brainer and should be approved by NCUA. But I also believe that such transactions should be a two way street.
It would be hypocritical for the credit union industry or its regulator to permit a credit union to buy a bank or bank branches along with the deposits and loans; but to restrict the ability of banks to do the same.
I know that some within the credit union industry will argue that a bank buying a credit union or credit union branches is not the same as a credit union buying a bank or bank branches, because there is a need to protect the interest of the credit union members. But as I wrote in a January 22, 2010 post,
There are ample protections for members, and members are more than capable of determining what is best for them financially.
Maybe the regulatory hold up in approving this transaction is that NCUA fears that it is opening Pandora's Box.
But what's good for the goose is good for the gander.