It was probably just a coincidence that two credit union mergers were announced recently in Minnesota, although an increased presence in the market by some of the nation's largest banks could be a factor.
Late last month, the $1.8 billion Hiway Credit Union in Saint Paul said it will hold a
Then this week, two Bloomington-based credit unions unveiled merger plans. The $92 million-asset Star Choice Credit Union and $297 million-asset SharePoint Credit Union announced their
And while consolidation is not unusual or unexpected — in Minnesota, the number of credit unions has dropped by 19%, to 87 institutions, since 2018, according to the state's credit union association, the Minnesota Credit Union Network — a larger presence by two of the largest banks in the country could be putting more pressure on credit unions in Minnesota.
JPMorgan Chase and Bank of America both have been active in the market the past couple of years. Chase opened a branch on the University of Minnesota campus in 2018, and the bank
Bank of America moved into the market in 2015 and has
"There's consolidation and collaboration happening here just like there is everywhere else, and we're seeing some moves by bigger banks like Chase and Bank of America, but I don't believe this market is unique in that regard," said Dave Boden, president and CEO of Hiway Credit Union.
Overall, the number of federally insured credit unions in the U.S. declined to 4,712 in the first quarter of 2023, from 4,903 in the first quarter of 2022, according to the National Credit Union Administration.
Most mergers in Minnesota the past 10 years have been of bigger credit unions merging with smaller ones. However, there have been examples of mergers of equals among two smaller credit unions, with driving factors including retiring leaders or member-elected boards seeking scale through consolidation.
The only recent merger in Minnesota involving two credit unions with at least $1.5 billion of assets was the
Spire has been busy with
Meanwhile, membership in Minnesota credit unions has grown from 30% of the population to 35.5% during the past ten years, according to the Minnesota Credit Union Network.
The group's CEO, Mara Humphrey, said the recent mergers "will provide their combined membership — and Minnesotans — further access to a Minnesota-headquartered not-for-profit financial cooperative with affordable, accessible and personalized financial services."
There are more than 400 credit union branches serving 2.1 million members across the state, Humphrey said.
SharePoint and Star Choice will have $400 million in assets combined and thus will be better positioned to expand access, products and technology offerings, the credit unions said in a press release.
"Both our credit unions have a loyal membership that appreciates the personal service we have provided over the years. None of that will change with this combination," said Phillip Kopischke, president and CEO of SharePoint.
The combined entity will operate under the SharePoint Credit Union name and serve more than 30,000 members, with a seven-branch network across the west metro area of Minneapolis/St. Paul. Kopischke will remain president and CEO of the combined entity, and Olson will remain with SharePoint with responsibilities over integration, asset/ liability management and transition.
The credit unions expect the deal to be finalized in early 2024.
