Upon RUSA FCU's acquisition, the credit union's board of directors was dissolved, and Affinity FCU now serves around 2,000 Rutgers University students and alumni as part of its membership pool of about 136,000, Affinity FCU Vice President of Member Experience Donna Lostocco said.

While the Rutgers University Student Assembly supports the merger, it opposes the university's decision to not renew the lease for the credit union's New Brunswick campus branch, said Charlie Kratovil, who served on the RUSA FCU board of directors from 2009 to 2010. The Newark and Camden branches became Affinity FCU branches at the beginning of the current school year and will continue to operate along with 19 other Affinity FCU locations. The New Brunswick branch will close its doors on May 20.

Lostocco said Affinity FCU plans to open a new branch to replace the New Brunswick branch at an as-yet-undetermined location.

John Milazzo, president/CEO of Baton Rouge, La.-based $438 million Campus Federal Credit Union, said he does not believe a merger trend would be isolated to school-related CUs.

“If this economy continues like it is, mergers could be a trend in all sectors of credit unions, not just school-related ones,” Milazzo said. “In some cases, a merger is the best option.”

Campus FCU serves more than 59,000 Louisiana State University faculty, students and alumni, with faculty making up the majority of its membership, followed by students and then alumni, Milazzo said.

School-related CUs do, however, encounter their own set of challenges. Rogers said they often face what he calls a double-edged sword–on one hand, their on-campus locations drive convenience, but on the other hand, many students are unfamiliar with the sheer concept of a credit union.

“They often have to close the equivalent of a cold-call sale, because everybody knows who Bank of America is, but what's this credit union thing?” Rogers said.

Rogers also points out that school-oriented credit unions can suffer if they're not electronically up-to-date. Lending can also be tougher for them than for the average credit union, given that their members are not stable, full-time wage earners, he said.

“College students have an increasingly electronic sense of what convenience means, and if the credit union isn't set up with a functional suite of remote delivery, then even a branch in the student union may not attract a lot of new members,” Rogers said.

Milazzo said it's difficult to attract young members because they tend to bank where their parents bank. He also cites profitability as a challenge given the economic hits recently taken by its sponsor, LSU, as well as growth–Campus FCU has been “growing too fast on the deposit side but not on the lending side,” he said.

But school-related CUs enjoy the advantage of a large pool of potential new members every year, as well as the opportunity to cultivate new credit union advocates, Rogers and Milazzo said.

“I've always believed that credit unions have a great socially responsible story to tell, and that story finds eager ears among college students,” Rogers said. “But college students are also hard-nosed. They don't just want to hear a socially responsible story, they want to see what it looks like in the real world.”

Convincing college freshmen, whom Rogers calls “America's most distractible demographic,” to join a credit union requires aggressive marketing. Milazzo said his credit union's strategy involves working closely with student organizations and sponsoring university events. He added that Campus FCU often finds success with the foreign student market, as they do not arrive on campus with an established banking relationship through their parents and are in need of local, convenient banking services.

“I think that those students who care enough to check us out are impressed,” Milazzo said.

With the average credit union member age at 47, could future acquisitions of school-oriented CUs delay the goal of bringing that average age down? Rogers believes the contrary.

“I think a larger credit union that merges with a smaller school-related credit union is better positioned to impact the average age of credit union members,” Rogers said. While student credit unions can attract young members, they're often ill-equipped to keep them after they leave campus, he said.