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Bay Gulf to merge with MIDFLORIDA CU
TAMPA, Fla. (6/16/10)--Bay Gulf CU, Tampa, announced its intent to merge with MIDFLORIDA CU of Lakeland, Fla., subject to a due diligence review already underway. Both credit unions’ boards of directors have unanimously approved the merger. The intention to merge is not related to a cease-and-desist order issued in April to Bay Gulf by the Florida Office of Regulation, according to Bill DeMare, Bay Gulf president/CEO. “The cease and desist order was not what triggered it,” he told News Now. “I had been in talks with Kevin Jones [MIDFLORIDA CU president/CEO, regarding a merger] for some time.” Bay Gulf looked into the merger as a means to maintain profitability, and its board wanted to offer members more products and services. “The decision to merge was not an easy one, but our board felt like the products, services and customer service offered by MIDFLORIDA would benefit Bay Gulf’s membership,” DeMare said. He noted that MIDFLORIDA also is open extended hours from 7 a.m. to 7 p.m., which would benefit Bay Gulf members. While some of Bay Gulf’s long-time members may be sad to see the name change to MIDFLORIDA, DeMare said he hopes most members will be amenable to the change. MIDFLORIDA has $14 billion in assets, with a net worth of $130 million and a 9.3% net worth ratio. The combined credit union will have $1.55 billion in assets, with 150,000 members. MIDFLORIDA also has been rated five stars by Bauer Financial Ratings. “[The merger] really puts us in a strong financial position,” he said. “That’s a plus. We’ve had members ask about Bauer Financial Ratings.” Bay Gulf is a two-star institution, which is not “unusual with our capital,” DeMare said. Bay Gulf has submitted a capital restoration plan to regulators to help it reach 7% net worth by September 2012 after the cease-and-desist order. The credit union has been operating normally since. Regulators reviewed the plan and had several suggestions for adjustments, which include making a more conservative estimate of the effects the National Credit Union Share Insurance Fund premiums will have on the credit union. “We took a more optimistic approach,” DeMare said of the estimate.


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