Southwest Corporate FCU and Georgia Central CU come very close to merging

DULUTH, Ga. – There was almost a third corporate CU merger this year, but it fell apart late in the game. The $1.5 billion Georgia Central CU and the $6 billion Southwest Corporate FCU signed a letter of intent to merge earlier this year. It would have been one of the most compelling corporate mergers in some time. Here’s why. It involved corporates of noncontiguous states; the merged corporate was planning to assume a new, nongeographical name; the whole process started with Georgia Central CU sending out an RFP for a merger partner (a first in the network); and the most intriguing aspect was Georgia Central said it planned to dividend out its retained earnings to its member CUs prior to the deal closing. Returning capital was the same issue that came up in the Washington Corporate/Northwest Corporate deal and was never addressed. In this case the Georgia Central board voted to discontinue the merger because it could not work out the details of returning capital to its member CUs. Georgia Central said the regulatory environment made the process very difficult, and said it was also getting a little dicey determining what each CU should get back. Southwest Corporate said it is still open to a merger with other corporates. Georgia Central CU is now in the midst of an executive search to find a new CEO. Its former CEO, Dave Preter, left to lead Mid-States Corporate FCU.