LSCU & Virginia CU League Explain Benefits of Proposed Consolidation

Within the coming weeks, member credit unions of the Virginia Credit Union League (VACUL) will be voting on whether to merge with the League of Southeastern Credit Unions (LSCU).

Consolidation talks began after Carrie Hunt, former VACUL president/CEO, was named chief advocacy officer for the newly formed America’s Credit Unions in December after CUNA and NAFCU credit union members agreed to merge.

A letter of intent was signed by both organizations about two weeks ago, LSCU President Samantha A.M. Beeler said, who will lead the merged organization if approved by member credit unions.

In an interview Tuesday with CU Times, Beeler said the proposed merger would deepen the professional bench staff and enhance the focus on regulatory advocacy initiatives for both leagues.

Although the state trade groups are separated by hundreds of miles, she doesn’t see this as a barrier.

“What it does do is provide a depth of knowledge, experience, and networking for our credit unions in an area that’s not necessarily in their backyard, so it’s not as competitive. And yet the advocacy landscapes are similar,” Beeler said. “People think of Georgia as a red state, but it truly is a purple (state) in so many ways when you look at our governor versus our Senate delegation. And you’ve got the same version of that up in Virginia. The political landscape of the state and federal delegation level is very common, so it helps us galvanize both our advocacy efforts and find messaging that resonates throughout the footprint.”

This is the first proposed merger agreement of state leagues since 2022, continuing the consolidation trend of the industry’s state trade groups that began more than 19 years ago. In 2022, the Heartland Credit Union Association amalgamated with the Cornerstone Credit Union League that created a five-state trade group, and the Mountain West Credit Union Association joined forces with the Northwest Credit Union Association, which formed a six-state trade organization.

Beeler said the legal details of the voting process are still being worked out for Virginia credit unions to decide whether to consolidate with LSCU, which would include both associations, foundations, and service corporations.

According to a joint prepared statement, the results of that vote are expected to be announced in November.

“With advocacy being at the core of our focus as an association and board, we believe this move to be in the best interest of credit unions as it will undoubtedly increase our advocacy impact and influence,” Jeff Bentley said in a prepared statement, who is VACUL’s Board Chair and president/CEO of the  $4.5 billion Northwest Federal Credit Union in Herndon, Va. “We look forward to continuing our due diligence to identify a path forward that will be beneficial to all Virginia credit unions.”

The combined organization would represent 386 credit unions and 31.5 million members. Steve Willis, president of LSCU’s LEVERAGE for-profit subsidiaries, would lead the combined service corporations, which would include VACUL’s for-profit subsidiary, Virginia Credit Union Services Inc.

If the consolidation is approved, every credit union will have an assigned league consultant who provides custom engagement reports to ensure members are maximizing the full value of affiliation and are aware of beneficial solutions from LEVERAGE, according to a joint prepared statement.

VACUL’s 17 employees serve 98 of Virginia’s 100 credit unions, listed as active, according to the NCUA’s listing.

“We’ve committed to retain (VACUL’s) staff for up to two years, obviously, (and) hopefully longer than that,” Beeler said.

LSCU’s has about 27 employees that serve nearly 300 credit unions throughout Alabama, Florida, and Georgia. LEVERAGE has about 100 employees. The NCUA and America Share Insurance list 284 active credit unions in the three states.

The Virginia league posted net assets of $9.6 million while LSCU, which serves Florida, Alabama and Georgia, recorded net assets of $41.1 million, according to their respective 2022 IRS 990 filings. In that year, VACUL’s membership dues amounted to $1,712,021 and LSCU’s membership dues totaled 4,856,857.

“While we seek member feedback during this discovery phase, we remain committed to advancing our collective industry and serving our members with greater impact,” Joe Thomas said in a prepared statement, who chairs VACUL’s transition committee and is president/CEO of the $521 million NextMark Credit Union in Fairfax, Va. “We believe the Virginia Credit Union League and the League of Southeastern Credit Unions share the same vision for success for credit unions.”

For additional information regarding this proposed consolidation, visit consolidation.lscu.coop.