Proposed Merger Would Create Minnesota’s Fourth Largest Credit Union
Hiway CU members are set to vote on consolidating with SPIRE CU in September.
A special meeting for members of the $1.7 billion Hiway Credit Union will be held on Sept. 13 to vote on whether to merge with the $2.1 billion SPIRE Credit Union. If approved, consolidation will create Minnesota’s fourth largest financial cooperative that will manage assets of more than $3.8 billion.
“Hiway and SPIRE cultures both focus on member experience and community giveback. As a combined entity the benefits to Hiway members, communities and employees are significant,” according to Hiway’s notice to its members about the proposed consolidation.
Hiway members will gain access to 22 branches of the Falcon Heights-based SPIRE, which serves more than 155,000 members. The St. Paul-based Hiway currently operates four locations and serves nearly 90,000 members.
Hiway also said the combination will allow for reduced fees, improved service and better rates, while the communities it serves will see “a significant increase in giveback,” and its employees will see more opportunities for advancement and enhanced benefits.
Hiway’s member notice, which was posted last week on the NCUA’s website, did not list any proposed changes with senior management, and according to the notice, no executives have received or will receive any increase in compensation.
The net worth of Hiway is 9.53%, (peer average 10.68%), which is higher than SPIRE’s net worth of 7.99%, according to NCUA financial performance reports for the first quarter. Second quarter results were not yet posted on the NCUA’s website for these credit unions as of Monday afternoon. If the consolidation is approved, Hiway’s net worth will be transferred to SPIRE.
SPIRE’s ROAA was 0.42% compared to peer average of 0.71%, at the end of the first quarter. Hiway ended the first quarter with a ROAA of 0.48%.
If the merger gets the green light from Hiway members, the combined credit union would manage a loan portfolio of more than $2.6 billion with a workforce of 611 employees that would serve more than 245,000 members.