The boards of the Kansas Credit Union Association and Missouri Credit Union Association said Monday they have signed a letter of intent to develop the framework for a proposed consolidation of the organizations.
Don Cohenour, president/CEO of the Missouri association, said he and Marla Marsh, president/CEO of the Kansas association, have been talking about a possible consolidation for about a year.
About three months ago, the associations formed a joint collaboration task force to explore the possibility of consolidation. After meeting twice, the task force gave the green light to develop a business plan that will detail how the new association would operate and how it would be governed.
“These are preliminary discussions, and the task force has a lot of work to do as well as myself and Don Cohenour,” Marsh said.
The business plan is expected to be completed by June 2015. After reviewing that plan, the two boards will vote on whether to present it to the credit unions in each state for discussion and a vote on whether to approve or reject the proposed consolidation.
“Part of the consolidation is certainly being driven by the fact that the number of credit unions is being reduced,” Cohenour said. “I think every state league is talking a look at what are the viable number credit unions they can serve and do it effectively and efficiently.”
In 1993, the Missouri association served 227 cooperatives. By 2013, that number of credit unions dropped to 129, according to CUNA. In Kansas, there were 166 credit unions in 1993. By 2013, there were 96, according to CUNA.
“What Marla and I decided was to address this issue long before we had to and be able to do it on our own terms so that we could continue to maintain our presence in our respective states,” Cohenour said.
Although Marsh agreed the credit union merger trend is a contributing factor for the proposed consolidation of the associations, it is not the driving factor.
“We want to drive a good value proposition,” she said. “We want to make sure that our credit unions continue to receive the type of service and value that they have become accustomed to over the last few years and throughout the history of the association. That is our driving force behind this.”
This represents the second league consolidation this year.
In October the Massachusetts Credit Union League, the New Hampshire Credit Union League and Credit Union Association of Rhode Island agreed to consolidate to form the Cooperative Credit Union Association.
Last year, the Texas Credit Union League, the Arkansas Credit Union League and the Credit Union Association of Oklahoma consolidated under the Cornerstone Credit Union League, and the North Carolina Credit Union League and the South Carolina Credit Union League merged under the Carolina Credit Union League.
Since 2007, there have been eight league consolidations.
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