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Just like that, the Midwestern states are emerging as the new hotbed for credit union bank deals.
The $1.1 billion 3Rivers Federal Credit Union in Fort Wayne, Ind., said last week that it signed a purchase and assumption agreement to acquire the $298 million West End Bank in Richmond, Ind., for an estimated $37 million in cash.
This deal is the fourth bank acquisition announced by a Midwestern credit union bank since May when the $3.2 billion Teachers Credit Union in South Bend agreed to buy the Michigan-based $119 million New Buffalo Savings Bank in a cash deal of more than $21 million. In June, the $962 million Verve, a Credit Union in Oshkosh, Wis. announced plans to buy the $295 million South Central Bank in Chicago. And in July, the $605 million Corporate America Family Credit Union in Elgin signed an agreement to acquire the $93 million Ben Franklin Bank of Illinois in Arlington Heights.
In addition, five Florida credit unions and one Arizona credit union have announced bank acquisition agreements so far this year.
On Monday, the $8,7 billion VyStar Credit Union in Jacksonville, Fla., said it closed the acquisition of the $280 million Citizens State bank in Perry, Fla., after securing regulatory approvals. That deal was initially announced in January.
West End Bank, which specializes in commercial loans, posted a net income of $391,000 and an ROA of 0.52% at the end of the first quarter, according to the FDIC. The bank manages $219 million in deposits and capital of nearly $30 million.
Founded in 1894, the bank operates four branches in Wayne County and employs 82 staff members who serve 24,000 customers. The bank also operates a high school branch.
Once the deal is completed by the first quarter of 2020 pending regulatory approvals and other customary closing conditions, the bank's branches and employees will continue to operate under the credit union's brand.
It's estimated that the bank's stockholders will receive between $34.91 to $36.81 per share, according to a prepared statement released by the bank and credit union.
Don Coates, president/CEO of 3Rivers FCU, said the acquisition would expand the credit union's market footprint and provide bank customers with additional products, services and technology offerings.
"As a proud native of Wayne County myself, I look forward to both organizations getting to know each other as we begin the transition process," Coates said. "We mutually feel that this is an ideal fit, as we are both deeply engaged in the communities we serve, have a strong organizational structure and sincerely care about or members' and customers' financial wellness."
This deal marks the 10th credit union bank acquisition so far this year.
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Peter Strozniak
Credit Union Times reporter covering credit union operations, fraud, M&As, leagues, business continuity, and breaking news.
