Archive Links

Consumer Archive
CU System Archive
Market Archive
Products Archive
Washington Archive

News Now

CU System
Filene Report Examines Merger Of Healthy Equals
MADISON, Wis. (9/30/13)--The Filene Research Institute has studied credit union mergers from several angles during the past two decades. Now it has examined a new trend--mergers of healthy equal credit unions.

A weak signal has emerged in the credit union merger landscape: "merger of equals" (MoE), according to "Credit Union Merger of Equals: A Preliminary Examination," Filene said.

MoEs occur when two healthy credit unions of similar size combine their assets and capabilities. While relatively few data exist to describe or explain this phenomenon, MoEs, while not common, represent a potentially important trend, said Filene. Although it is difficult to say what drives this emerging trend, qualitative discussions with credit unions across North America centers on a triad of:
  1. The need for scale;
  2. Regulatory pressures; and
  3. Consumer demand for more (expensive) services.
Consequently, more credit union leaders find themselves addressing the question: How prepared are we for a merger of equals?

In 2012, Filene and SchellingPoint developed an approach that allowed credit union leadership teams to answer the question. In a pilot, Filene asked 10 U.S. and Canadian credit unions, ranging in asset size from $150 million to $2.5 billion, to undergo an assessment of their organization's readiness for an MoE.
 
CEOs, senior leaders, and board members responded to, an online opinion survey and an online convergence form. The activities educated participants about the scope of an MoE and they shared their opinions on the multiple dimensions of MoEs.
 
While Filene's research indicates an MoE is a valid business tool in certain circumstances, it is not advocating for--or against--one. Instead it aims to reveal facts about a trend that may impact many credit unions in the coming years, the report said.
 
The report details Filene's interpretations of those participants' inputs, provides a structure for discussing these results, and pinpoints where discussion is required so credit unions can efficiently converge on next steps around MoE Topic.
 
To access the report, use the link.
RSS print
News Now LiveWire
#FreeGasFriday courtesy of @tvfcu, TN #creditunions http://t.co/wDRFYJVlpz
14 hours ago
If you were unable to watch or attend @cuna 's @thehill Hill forum on Wed., you can now watch the archived version: http://t.co/FhUnp7HbU8
15 hours ago
Time is running out. If you haven't taken the #NewsNow readership survey, please click here now: http://t.co/4Gp6C2Wa4o
15 hours ago
African financial inclusion possible with mobile money: @IMFNews study http://t.co/0V5DTQToxY
16 hours ago
Louise Herring's birthday is Saturday. 105 years later, her legacy lives on through her kids http://t.co/oMqGADmo0d http://t.co/T3NmS9NqEY
17 hours ago