"I think that there's always room for smaller credit unions to acquire even smaller credit unions as a way of expansion," he said. "But of course, it's going to be dominated by the big players. The big players naturally look to targets that are going to, what we say in the industry, move the needle."

It can take a long time for a small credit union to accumulate enough internal capital, but many of them can't afford to wait. If bank merger activity continues to accelerate and their increased scale and efficiencies position them to offer more competitive rates and services in credit unions' backyards, even the most efficient credit unions will feel it, Peter Duffy, a managing director at investment bank Sandler O'Neill, explained.

Even for credit unions that do have growth capital, it will likely take many deals to build much-needed scale. Around 5,000 of the country's approximately 6,300 credit unions have less than $100 million in assets, Duffy said.

And that's making acquirers choosy.

"If you are a larger credit union – meaning more than $300 to $400 million – there's a serious question as to whether a very small credit union is going to do much for you in terms of your franchise value, your ability to expand or improve your field of membership and your penetration within that field," David Giesen, a managing director at the Chicago-based Navigant Capital Advisors, said. "Most mid-sized credit unions probably have one small merger in them before they get tight on capital, particularly when you consider the new Basel III risk-based capital standards that have been rolled out for comment by the NCUA."

Those proposed risk-based capital rules treat book value premiums differently than the accounting rules do, and that can affect credit union valuations, Riggins added.

Small credit unions and banks at the $100 million value level might only get a premium of, say, 105% to 110% of book value, he said. Much of the reasoning goes back to scale, because those institutions are generally less efficient.

"The acquiring [institution] actually has to make an investment in order to bring them up to speed," he said. "We wind up with low market prices. There are some cases where there's actually been a small discount to book value made."

But because of increased regulation, many small credit unions may nonetheless be hungry for buyers, Riggins noted.

"It's continuing to build the level of operating expenses to the point where the smaller ones cannot afford to provide the type of expertise that they need to effectively manage the risk to the satisfaction of the regulators," he said. "There is a need from a smaller credit union's perspective, and a smaller community bank, a smaller community thrift, to find a merger partner."

One way to tackle the capital access problem is to change the rules on capital raising.

"Congress and the NCUA have been debating for as long as I can remember the whole question of credit union supplemental capital," Giesen noted. "They reintroduced some legislation earlier this year that appears to be going nowhere."

Sticking to organic growth is another option, albeit a tough one, Duffy said.

"The argument against needing mergers is there are other things we can do, like improve our marketing and organic growth," Duffy said. "It is extremely rare in banks and credit unions, in part because a loan and a deposit are commodities and it's hard to differentiate. The consumer knows it. And so in order to get a consumer to leave their current banking relationship, you've got to spend a lot of money in marketing and other ways that gets them to defy the laws of inertia and pick up and move over."

A third way, Giesen said, is to stop being a credit union.

"What's important to understand there is that if you want to grow, if a credit union wants to maximize the value of the franchise, it has to evaluate the best way to do it," he said. "For some maybe it will mean staying a credit union. The second approach would simply be to say, 'Okay, let's take a close look at our charter.' Our experience is that that's going on more than you think right now."

Accounting and finance consultant Mike Sacher doesn't buy most of the arguments, though. Sacher, a CPA, has been advising credit unions for more than 35 years and thinks there is plenty of opportunity to be had in small credit union mergers because they have such unique characteristics.

"[With] credit unions, typically when a merger occurs, there is no check being written," he explained. "So they're better able to absorb what might otherwise not be an institution of major interest if it was the banking equivalent."

There's still plenty of synergy to capture with small targets, too, he added.

"Clearly the bigger you are, whether you're a bank or a credit union, the more advantages you have in terms of managing the cost component of the operation," he said. "On the other hand, credit unions, at least today and hopefully going forward, have an advantage on the cost of taxation, which is essentially zero. I think that credit unions definitely have the ability to compete and have proven to be very successful at that, year after year."