All but two of the six credit union bank purchase deals announced since the beginning of the year occurred in Florida. What's more, the $3.4 billion MIDFLORIDA Credit Union in Lakeland announced last month that it intends to purchase the $738 million Community Bank & Trust of Florida, which is the industry's largest credit union bank acquisition deal thus far. The credit union is also purchasing the Florida branches and other assets of the $955 million First American Bank in Fort Dodge, Iowa.

So why has Florida become such a hotbed for these deals?

"I think it's because down here we have a pretty good culture of CEOs speaking with each other and sharing ideas," Miller said. "After we announced our acquisition deal, CEOs reached out to me. They're trying to figure out what has worked and what doesn't work, and we're happy to share that. We were not the first to buy a bank, but I got some good advice from others."

In 2015, the $1.7 billion Achieva Credit Union in Dunedin was the first cooperative in the Sunshine State to buy a bank, the $165 million Calusa Bank in Punta Gorda.

While cooperation and collaboration among CEOs may be a reason for the credit union bank-buying spree in Florida, merger and acquisition experts said there are other reasons as well.

"There are just a lot of small community banks down there," said Vincent Hui, who leads the Scottsdale, Ariz.-based Cornerstone Advisors' mergers and acquisitions practice for credit unions and banks. "That's just the reality. It's kind of that whole supply and demand dynamic."

John Stockamp, Seattle-based director of the financial services practice at West Monroe Partners in Chicago, Ill., said he agrees, but he added that the entire Southeastern region of the U.S. has been and continues to be replete with acquisition opportunities.

Since 2012, there have been approximately 32 credit union bank acquisitions. While 10 of those deals were made in Florida, at least seven additional credit union bank buy deals have occurred in Alabama, Georgia and Kentucky.

"There's just a lot more of these sub-billion dollars, sub-$750 million dollar banks out there," Stockamp said. "Generally speaking, credit unions are pretty healthy and they've got the powder, if you will, to go out and get some scale, and not just scale for scale sake," he said. "I think that credit unions have maybe a little different value proposition in terms of serving the members, especially when you get into the multibillion-dollar credit unions or those near that level. They've been able to use some of that powder to make some investment in technology and create member experiences that, frankly, banks have not been able to do because they've spent all their time in the last several years trying to make sure their credit portfolio will pass the compliance and regulatory scrutiny."

Nevertheless, Stockamp noted the Waco-based, $313 million Alliance Bank Central Texas acquisition of the Texas Farm Bureau Federal Credit Union could start a "potential dynamic" of the banks flipping the tables a little bit on credit unions. Compared to the credit union bank acquisitions, however, the Texas bank's purchase of the credit union was very small. Texas Farm Bureau FCU managed only $6.1 million in assets and served less than 800 members in Waco, and employed only one staff member, who retired.

After Texas Farm Bureau FCU's membership approved a voluntary liquidation, it did not require the NCUA's approval, according to John Fairbanks, spokesperson for the independent federal agency.

However, the bank submitted an FDIC application earlier this year to purchase the credit union's $3.2 million in loans, S&P Global Market Intelligence reported. Although the bank did not acquire the credit union's deposits, members were closing or transferring accounts to Alliance Bank Central Texas, and the state's regulator approved the bank's purchase and assumption of the credit union's sole branch, according to the report.

Texas Farm Bureau FCU also managed about $2.9 million in investments and $1.4 million in capital.

Bank officials did not respond to CU Times' request for additional comments.

While it is unsure as to whether other banks will buy credit unions, what is for sure is that credit union bank acquisitions will keep growing in the years to come. This is happening because bank acquisitions can help credit unions accelerate their growth in deposits, loans and market share.

"If I want to expand in an attractive market, I have basically only two choices," Hui said. "I can build a branch from scratch or I can buy something that has a built-in member base, including staff. That's the strategic decision. People feel there are risks on both sides, but if I am able to buy a bank that has branches in attractive locations, an established customer base and an established staff, then that will help me accelerate success in the market."

Addition Financial is buying Fidelity Bank of Florida, for example, to become the prominent financial institution in central Florida.

"It's a smart way to grow if the numbers make sense," Miller said. "So for us with the Fidelity Bank deal, we were able to pick up two branches with an existing customer base and with very good and talented employees, and it won't be that long of a payback on investment."

Another reason credit unions are looking to purchase mostly community banks is that they typically have a strong business and commercial loan portfolio.

"This is an opportunity, depending obviously on the bank, for credit unions to accelerate growth in the business services area," he said. "Having an experienced staff who knows the market is an opportunity for credit unions to potentially import some of those capabilities."

For example, the $1.6 billion Arizona Federal Credit Union recently announced that it intends to buy the $236 million Pinnacle Bank in Scottsdale. Arizona FCU President/CEO Ronald Westad said the acquisition will provide the credit union with expanded access to small business services, SBA financial options, commercial lending services, and 60 bank employees to serve small businesses and families.

Credit unions are also searching for bank acquisition opportunities because, according to what Hui has heard from many of his clients, bank buys are a bit easier to consummate and take up less time, and the transactions are far less emotional.

"The whole concept of return on time is pretty important," he explained. "It's going to take a little bit longer in time to do credit union mergers, particularly if it's something like a merger of equals. The business decision aspects of a credit union buying a bank are less emotional and a little bit more economically based, if you will, than a credit union merger."

One of the most important steps credit unions should consider before making a bank deal is to get human resources staff involved to evaluate any cultural issues around job titles, compensation and incentive plans. If bank employees, particularly key employees, don't feel comfortable working in a credit union culture they may leave, which can affect the purchase deal over the long run.

"Most community banks are commercial in nature," Hui said. "Commercial banks operate a little bit differently than retail banks. Because of that, you need to be mindful of how people operate and about compensation and titles. This really feeds into the HR and cultural aspects in that compensation, and how compensation is structured in a bank is often times very different from a credit union. With incentive plans, as an example, you could have loan officers making a ton of money sometimes comparable to the CEO. You don't see that in the credit union world."

In other words, to retain the bank's top talent, credit unions need to make sure they can offer comparable and competitive compensation and incentives plans.