He declined to comment on the consent order.

Without admitting or denying any charges of unsafe or unsound banking practices, Nokomis Savings Bank nevertheless agreed to the consent order.

The order directs the bank's board to retain qualified management for all key functions including risk management, interest rate risk, liquidity and earnings. Federal and state regulators also ordered the board to assume responsibility for the approval of policies and objectives for the oversight of management.

Regulators also gave Nokomis Savings 60 days to develop a strategic and profit plan, and revise and implement a liquidity and funds management policy, and 90 days to reduce its interest rate exposure. Within 45 days, the bank's board is also expected to establish a mechanism for tracking the correction of examination recommendations, including correctable exceptions identified on the violations of laws and regulations page on the examination report.

Nokomis Savings Bank President/CEO Charles O'Malley did not respond to CU Times' requests for comment.

At the end of the first quarter, Nokomis Savings posted a net income loss of $308,000, compared to a net income gain of $25,000 at the end of last year, according to its Call Reports filed with the FDIC. The bank's capital dropped to $1.6 million in the first quarter, from $2.2 million in the fourth quarter of 2022, and its assets fell from $28.3 million to $27.9 million.

Financial terms of the proposed acquisition deal were not disclosed.

Originally organized as Nokomis Building Association on May 8, 1881, the bank currently serves roughly 800 customers. The full-service community bank manages $21 million in deposits, $11 million in loans and one location that serves the West Central Illinois community.

In a prepared statement, Ares said the acquisition will expand access to the credit union's service area in Montgomery County and other contiguous markets.

"This acquisition is part of Land of Lincoln's strategic growth plan, which includes adding branches and markets to better assist our members throughout Illinois," he said. "Nokomis Savings Bank's customers will become members of Land of Lincoln with full access to our wide array of products and services. We look forward to welcoming Nokomis Savings Bank's customers and employees into our family."

This is Land of Lincoln's second bank acquisition. In December, the credit union announced plans to buy the $82 million Colchester State Bank (CSB) in Colchester, Ill., in an all-cash transaction, which is still pending.

So far this year, only two credit union bank buy deals have been announced. In addition to the Land of Lincoln's proposed acquisition, the $1 billion 4Front Credit Union in Traverse City, Mich., in January said it will buy the $126 million Old Mission Bank in Sault Ste. Marie, Mich.

Compared to last year, there were six credit union bank buy deals that were announced from February to April. By the end of 2022, there were 16 credit union bank buy agreements announced, up from 13 deals announced in 2021.

Though 10 deals from 2021 have been completed, two were called off, including what would have been the credit union industry's largest bank acquisition of the $1.7 billion Heritage Southeast Bank in Jonesboro, Ga., by the $13.7 billion VyStar Credit Union in Jacksonville, Fla. In January, Heritage Southeast was acquired by The First Bank of Hattiesburg, Miss.

In addition, the legality of a third purchase agreement of the $891 million Financial Federal Bank in Memphis by the $1.2 billion Orion Federal Credit Union, also based in Memphis, has been challenged by the state's regulator, which filed an appeal before a Tennessee court in Nashville to block the deal. The appeals court has not yet made a ruling, according to public filings.

Four of the 16 credit union bank buy acquisitions announced last year have been completed.