Two Virginia Credit Unions Announce Plans to Merge
Chesterfield FCU official cites recession fears, along with technology and compliance costs, as reasons why the merger makes sense.
North Chesterfield, Va-based Chesterfield Federal Credit Union and Virginia Credit Union have announced plans to merge. Financial terms of the deal were not disclosed.
Chesterfield FCU has $90 million in assets and about 11,000 members. Virginia Credit Union is the state’s largest state-chartered federal credit union, with $3.7 billion in assets and more than 285,000 members.
“We made this decision to ensure the long-term sustainability and expansion of services to our members. With growing costs for technology, compliance and security, we believe such a step has become necessary. It is increasingly difficult for small and mid-size credit unions like ours to provide the range of services that members deserve and expect,” Chesterfield Chairman Scott Zaremba said in a letter to members.
“The last recession was very difficult for many businesses, including our credit union, and we are not confident that we could remain well-capitalized through another economic downturn. We believe the time to take this step is now, while our credit union remains financially sound and we have the opportunity to partner with a strong, local credit union,” Zaremba added.
Zaremba said Virginia Credit Union is already a large supporter of the Chesterfield community and that it had the resources to make investments that will benefit Chesterfield’s members after the deal closes. Chesterfield members will get more services, better online and mobile banking technology, new card options and an ATM fee rebate program, according to the letter.
However, one of Chesterfield’s three branches will close once the consolidation is complete, and its employees will need to apply for jobs at Virginia Credit Union, according to FAQs posted on Chesterfield’s website.
Both credit unions’ boards have approved the merger, but Chesterfield members must still greenlight the deal, Zaremba noted.
Virginia Credit Union President and CEO Chris Shockley said that Chesterfield’s board reached out to the credit union several months ago.
“Our credit union is based in Chesterfield County, four of our branches are here and we already serve thousands of Chesterfield County residents. Both credit unions have made financial wellness for our community a top priority, so we agree this represents a good fit,” Shockley said. “We look forward to providing excellent service to CFCU members.”
If members approve, the merger should happen in early 2020, although full consolidation could take some additional weeks to complete, according to Virginia Credit Union.