The Devil is in the Details: Some CU CEOs Say They Need More Specifics About Concord Deal; Others Happy with Progress

As other networks write to CU24 members asking for their business, executives from CU24 and Concord have hit the road trying to explain the prospective sale to CU24 member credit unions. Here’s what some CEOs said about one of the recent meetings. “Overall, I would say the meeting was good, the presentations from Concord were good and from the consultants were good,” said Ed Baranowski, CEO of the $845 million Fairwinds Credit Union, based in Orlando, Fla. “But when it came to details about the prospective deal, that they want us to evaluate, it was too nebulous,” said Baranowski, who is also chairman of the PSCU Board until April, which had itself been part of a failed bid for the network. Key details of the arrangement, which Baranowski and other CEOs said would be vital to helping them evaluate the deal, were left unclear, the executives complained. For example, it was left unclear what would happen if too few CU24 member credit unions agreed to sign up for four-year contracts with Concord. Some CEOs understood the executives to say that credit unions representing 75% of CU24′s transaction volume would have to agree for the deal to go forward. Others 80%. Others 95%. But CU24′s Vice President for Communications, Mary Warren, said the figure was unclear because it had “yet to be determined.” “That’s just unacceptable,” said Bucky Sebastian, outspoken CEO of the $1.2 billion GTE Federal Credit Union, based in Tampa. “You don’t call an informational meeting and then not give anyone the information they need.” But Wendell Brooks, CEO of the $415 million Pinellas County Teachers Credit Union, based in Largo, Florida, countered that the presentations and analysis about the logic behind the deal had been well done and had helped make him lean more toward the deal, although he emphasized he has not finalized a decision. “I think it became clear that they saw this purchase as taking advantage of an open window which might not be open forever,” Brooks said, adding that for his credit union the make or break part of the deal will be the financial rumination his credit union might achieve from the sale. He said that information was crucial since it would have to be evaluated in the light of possibly higher transaction costs the deal might bring with it.