First Castle Credit Union merges into Pelican State as losses mount
First Castle Federal Credit Union, the nation’s second-oldest federally chartered credit union still operating at the end of the first quarter, has merged into Baton Rouge-based Pelican State Credit Union.
Originally founded to serve the New Orleans district of the Army Corps of Engineers, First Castle in Covington, La., had $69 million in assets and about 5,800 members at the time of the merger. All three of its branches are now Pelican State facilities and all of its employees have been transitioned to the $519 million-asset shop.
“We set out to choose a partner that would continue to provide enhanced services to our members and allow us to leverage additional resources for continued credit union and employee growth,” said Kirk Arnold, First Castle’s president and CEO prior to the merger and a 28-year employee there.
A press release noted that First Castle selected Pelican State as a merger partner because of its “dedication to financial wellness, award-winning employee culture, and personalized commitment to its branch communities across Louisiana.”
This is Pelican State’s 13th merger and its largest to date. It is Louisiana’s largest state-chartered credit union and serves more than 55,000 members with nearly $520 million in assets.
Call report data from the National Credit Union Administration shows that First Castle lost nearly $3.2 million during the first quarter, the most recent figures available. The credit union earned less than $10,000 during the first half of 2019 but lost nearly $200,000 by the end of the year. Its losses were fueled in part by significant increases in charge offs each quarter, primarily in used auto lending and indirect lending.