TUCSON, Ariz.-Desert Energy CU said it intends to voluntarily merge into Pima FCU, pending approval by its members and both NCUA and the Arizona Department of Financial Institutions.
The merger would create a $310 million CU with more than 50,000 members and approximately 150 employees. No layoffs are planned, with Pima Federal the surviving name and charter.
Linda Dhaemers, president and CEO of Desert Energy, told Credit Union Journal the merger, if it is approved, would address and improve many of the challenges of operating as a smaller credit union. Desert Energy, which was chartered in 1937, has approximately $60 million in assets.
"I don't know if I could say there is one reason; there are many reasons," she said when asked why Desert Energy sought to merge with a larger CU. "We wouldn't be pursing it if it didn't add value for our members and for our employees. The board has been discussing it for the past year, and the issue that came up repeatedly was building strength for the future. With the merger, our members would have access to more products and services - things we don't offer because of our size such as safe deposit boxes and in-house first mortgages."
The merger also would bring members an expanded branch network and longer service hours, Dhaemers continued. She said the combined CUs would have seven branches, some of those open on Saturday and some with bilingual staffs.
"Economies of scale lead to better pricing and enhanced technology, and the combined credit union would make us a major competitor in the marketplace," she said. "But the approval isn't there yet; and that is needed."
Dhaemers would become an executive officer with Pima Federal. She said her initial role will be "chief merger officer," meaning she would be "responsible for the entire merger, from check processing to bringing the two staffs together."
"I will be seeing this transition through, which doesn't happen overnight," she said.
Nathanael Tarwasokono, president and CEO of Pima Federal, said in a statement, "This partnership brings together two strong credit unions that have had much success in the Tucson community."
The $250-million, 42,000-member Pima FCU was established in 1951 by teachers of Amphitheatre High School.
