Merger Between Two Texas CUs Keeps Credit Union in the Family

PORT NECHES, Texas – “Sit up straight, eat your vegetables, and.take care of my credit union.” Maybe it won’t go exactly like that, but Andrea Johnson, CEO of Neches Federal Credit Union, is sure to have advice for Jason Landry, CEO of Huntsman Federal Credit Union, when their two credit unions merge April 1. Landry, who will become the president and chief executive officer of the new institution – NechesHuntsman Federal Credit Union – is Johnson’s son. Located in a small town east of Houston, these two credit unions have had a long-running competition for members and member satisfaction. Please don’t assume, however, that Mr. Landry’s credit union somehow bested Ms. Johnson’s credit union to become the victor. A more equitable merger of two healthy credit unions likely does not exist. The credit unions, situated a couple of blocks from each other, are virtually the same size in terms of assets ($66 million), members (8,500) and employees (25). And while Landry will assume the role of CEO, Johnson will fill the position of executive vice president. Likewise, one credit union will contribute the chief financial officer to the new institution; the other, the chief operating officer. The two seven-member boards will combine, and because the law requires an odd number of directors, Johnson will serve as the 15th member. “We are fortunate to have a very involved board of directors,” said Johnson. “Some of our board members and Huntsman’s board members have worked together before and know each other from their involvement in the community and the credit union industry. It’s certainly one more positive aspect about the merger.” Additionally, all employees and credit union locations (a total of three) will remain intact. Even the credit unions’ names will be joined together, with the “nonsurviving” credit union’s name appearing first. “Neches” is familiar to area residents as part of the town’s name and as the name of a river. “It’s a real give-and-take situation,” Johnson said. “Philosophically, I hate to see this credit union go away, but the merger will allow us to provide more services to both memberships.” Both credit unions were chartered in the early 1950s at industrial plants down the road from each other, one as Jefferson Chemical FCU and the other as Neches Butane FCU. In 1980, Texaco Chemical bought both sponsor companies. The credit unions explored the possibility of merging then, but opted to remain independent. In the years that followed, both credit unions underwent name changes and eventually took on community charters. Today, a “sizeable” number of people hold memberships at both credit unions. The possibility of merging resurfaced a year ago as both CEOs evaluated adding new services and locations for their members. “The expenses duplicated at the two credit unions over the past five years – for facilities, one-time computer purchases and monthly computer maintenance – have been extreme,” Landry said. The credit unions looked at financials and talked to officials at the Texas Credit Union League and NCUA, evaluating the strengths of each organization. They see the merger as an opportunity to create “a more perfect union.” “With what seems like a credit union on every corner around here, competition is extreme. Both of our credit unions have been successful because of very personalized service. We won’t change that,” Landry said. “We won’t be adding audio response. We will still answer phones with live people and provide one-to-one service. But our alliance will give us greater purchasing power and more flexibility in adding new technology.” For example, members of both credit unions will immediately benefit from the merger with additional locations and ATMs; Neches members will be introduced to bill payment services; Huntsman members to overdraft protection services. “It should be a smooth transition, because we’re on the same data processing system,” Johnson said. “The only real concern we’ve had from our members was whether the employees would stay the same. Members want to work with the employees they’ve always worked with. We assured them the employees are staying where they are, and we’ll probably have to hire more,” said Johnson. “The credit union will continue to have a positive impact and presence in the counties we serve,” said Landry. “The new credit union will staff 55 professionals we consider to be the best in their field. We are confident that NechesHuntsman Federal Credit Union will be considered one of the area’s preferred employers.” With combined assets of $132 million, the new credit union will be the 5th largest of 35 credit unions in the Sabine Chapter of Credit Unions. “Our objective is not to take over the area,” Landry said, “but to strengthen service to members. We have always been, and will remain, dedicated to helping smaller credit unions.” The credit union movement has played a major role in the lives of Landry and Johnson. Landry began his credit union career 16 years ago as a collector for Huntsman FCU. After stints in accounting, data processing, and lending, he became the credit union’s assistant manager, and in 1991 was named president/CEO. Johnson has more than 34 years of service to Neches FCU. She is married to Glenn Johnson, chairman of the board at nearby Texaco Community Credit Union. “Credit unions are definitely a family affair,” Andrea said. Jason concurred. “The credit union philosophy has been embedded in me since I was very young. Growing up, my mother would bring statements home on the weekend, and my brothers and I would fold and stuff them in envelopes.” They worked side-by-side then, and beginning April 1, they’ll work side-by-side again. But does this mean that Landry now can pull rank on his mother? “I guess I’ll be accountable for the final decisions,” he said, “but we have a lot of respect for each other. [Andrea] is a well-known credit union leader in Texas and on the national level. She’s been a director for Texas Credit Union League and is very politically involved. She will be an extreme help in all decisions. “Both credit unions have been very successful,” Landry continued, “but we would have been more successful if [my mother] hadn’t been managing the credit union around the corner. I’m glad we’re going to be on the same team now!” What recommendations would Johnson give her son? “Early on in his career, I had advice for Jason, but the last couple of years I’ve actually been calling him for advice. He has spread his wings and is flying fine on his own,” Johnson said. “We have similar philosophies and operating styles. I couldn’t think of anyone I’d rather see take this position.” -