Heritage FCU Expects to Close Bank Acquisition on March 31

After securing regulatory and shareholder approvals, the $781 million Heritage Federal Credit Union in Newburgh, Ind., said Monday it expects to close on the acquisition of the $86.5 million Elberfeld State Bank on March 31.

Heritage said its assets will increase to about $877 million and its branch network will expand from 10 to 13 throughout the Evansville metropolitan area.

Founded in 1905, the bank operates three branches in Elberfeld, Evansville and Hausbstadt, managing total deposits of $75.4 million at the end of 2020, according to the FDIC.

At the end of 2020’s fourth quarter, ESB posted net income of $757,000 and an ROA of 0.89%. The bank recorded $10.2 million in capital at the end of last year.

The FDIC lists the bank’s asset concentration as agricultural specialization, which includes financial institutions with agricultural production loans plus real estate loans secured by farmland in excess of 25% of total loans and leases.

Financial terms of this acquisition were not disclosed when announced last July. It was one of only six proposed credit union bank buy deals announced in 2020, down from the 14 deals in 2019.

So far this year, only one proposed credit union bank acquisition agreement has been signed.

In January, the $6.7 billion Wings Financial Credit Union in Apple Valley, Minn., agreed to acquire the $72.3 million Brainerd Savings & Loan in Brainerd, Minn. The transaction, which requires approval by state and federal regulators, is expected to close by May 31.

Last year, Wings Financial did not close its proposed acquisition to buy the $260 million Neighborhood National Bank in Mora, Minn. The credit union declined to comment about why the bank purchase was not finalized.