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SW Bridge Corporate members vote to merge with Ga. Corporate
DULUTH, Ga. (8/31/11)--The membership of Southwest Bridge Corporate voted overwhelmingly Tuesday to approve the corporate's merger with Georgia Corporate, a consolidation that will create Catalyst Corporate on Sept. 6. More than 98% of voting members approved the merger. The vote came one day after the corporates received approval to merge from the National Credit Union Administration. Tuesday's outcome was "gratifying, but it's no surprise," said Kerry Parker, chairman of the Executive Committee for Southwest Bridge's Member Advisory Council and president/CEO of A+FCU, Austin, Texas. "We have had member input all along the way--from the advisory council planning process to an earlier member vote on the plan, which received approval from 91.3% of the 540 voting credit unions," Parker said. "Most importantly, the membership voted with its capital pledges." The corporates raised about $93 million in capital from 875 members, representing 74% of previous capital shareholders. "The fact that so many credit unions, after completing months of due diligence, chose to capitalize Catalyst Corporate shows that the business model is what credit unions were looking for," said Georgia Corporate Board Chairman Lin Hodges, president/CEO of Associated CU, Norcross, Ga. "Credit unions have confirmed that they believe in a cooperative model, and that they appreciate the importance of scale when choosing a corporate." Georgia Corporate President/CEO Greg Moore said Catalyst's operating efficiencies will make a difference beyond pricing. "It means that we won't have to rely on our balance sheet, and that means less risk." Credit unions have made it known that they want to continue to use the services of a corporate but also reduce their exposure to risk. "Catalyst Corporate represents this low-risk value proposition by minimizing the amount of capital a credit union puts at risk," said Dianne Addington, president/CEO of Southwest Bridge Corporate. Catalyst's model balance sheet is more conservative that what is required by the new Regulation 704, she added. Hodges noted that there should be no problem with today's vote at the Georgia Corporate. Its board "has been actively engaged in the details of this consolidation and has approved each major component of the plan in the past; this final vote ratifies the merger so that it can move forward this weekend." The merger will make Southwest Bridge Corporate the first corporate to come out of bridge status--well in advance of the two-year timeframe established by the NCUA last fall. "We believed it important to act quickly so that we could return to the business of creating value for our members," Addington said. "This merger allows for a strong, efficient, member-driven corporate that will meet the needs of the credit union community--for both our current members and other credit unions that are seeking a corporate home," said Moore.


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