Three's Allowed

Register now

Three credit unions here- Oregon Central, Oregonian Federal and Mountain View Federal-plan to merge into a single operation by the end of April.

Mike Cline, CEO of Oregon Central CU; Chuck Garner, CEO of Oregonian FCU; and Sam Launius, CEO of Mountain View FCU told The Credit Union Journal the still unnamed entity will be Oregon's 11th largest CU when the merger is complete. Cline will be the CEO, Garner the executive vice president, and Launius the vice president of branch operations.

"We are working on the name," said Cline. "It will be derivative of Oregonian and Oregon Central, though we probably will not use the word 'central' to make sure people understand we will serve members from the entire state. The name will quickly focus members on what we are."

Garner said the name will be announced on or about Feb. 1.

Oregon Central is the largest of the three CUs, with 27,000 members and $172 million in assets. Oregonian FCU serves 4,900 members and has $43 million in assets, while Mountain View FCU has 5,700 members and $21.2 million.

The new CU will be headquartered in the Oregonian FCU's lone branch in downtown Portland. It will have additional branches in northeast Portland, Wilsonville, West Linn, Beaverton, Milwaukie, Rockwood, Gresham and Eugene.

According to Garner, the headquarters branch building has two stories and 9,000 square feet, and has ample space to combine the three operations.

Making Plans

"We have plenty of room here. We will finish one area that will be used for accounting and backoffice staff, and we have unused offices where Mike and Sam can move in," he said.

Oregonian FCU has one data processing system, as does Mountain View FCU, Garner explained. Neither Oregonian nor Oregon Central have phone centers, but the new entity will- allowing some backoffice people at those two CUs to move to the phone center.

"The phone center will allow people to focus on serving members at the branch," said Launius.

The merger was brought on in part because Cline, 62, is considering retiring in a few years. If the merger is approved by the members of Oregonian and Mountain View in a March vote, as well as state and federal regulators, Garner, 52, would become the new CEO when Cline retires, followed several years later by Launius, 42.

"We get along well together," said Garner. "It helps that we are diverse in our ages."

The three CEOs say the merger will be done without layoffs or a loss of board members. When merger talks first began during the summer of 2004, they created an organization chart to account for every employee and volunteer.

Said Cline: "Some jobs will change, of course. Some might be moved, such as from teller to phone center. Some might be promoted. If anything, we might have to hire a few new people."

Oregon Central's seven-member board of directors will remain intact, and will be joined by two members of the Oregonian board, bringing it to nine. Three members of the Mountain View board of directors will form the core of a new advisory board, which will have up to seven members. The supervisory committee, which will have up to five people, will draw from Oregon Central and the Oregonian.

In addition, there will be a social responsibility committee with a to-be-determined number of members.

Between the two boards and the two committees, all board members will have a place, if they choose.

"You never turn down volunteers, because they are hard to get-especially if they are experienced," said Cline. "We don't want to lose any expertise."

Added Launius: "Getting volunteers has been a particular problem of ours the last two years. Board members have retired or moved away. We don't want to lose the ones we have."

Garner said the Oregonian's board was concerned about the disposition of the staff, and when it was explained all would be retained, they were happy with the merger plan. Launius said Mountain View's board had a similar reaction.

"The lone question was: what is the staff situation? Will there be layoffs? This was addressed in 10 minutes, because Chuck's and Mike's philosophies are the same as mine," he said.

Benefits of Merger

According to Cline, doing both mergers at the same time is preferable to doing one, waiting for the dust to settle, then doing the other.

"If we did that, we'd spend all of 2005 merging. Most credit union mergers involve a sick institution and a healthy one, and the sick one goes away. This isn't the case," he said. "We've got strong credit unions here. All three are well-capitalized and well-managed. The merger just makes a lot of sense for our members, because it gives us branches in downtown Portland [the Oregonian's current location] and Gresham [Mountain View]."

Said Launius: "The nice thing about the process is, it came together fairly easily and quickly; mostly because our attitudes are similar. The more we went down the road towards the merger, the more excited we got."

"Everything has been positive," agreed Garner. "Our members are happy to gain all those branches."

The merger plan will be in the hands of federal and state regulators by the end of January, the three CEOs said. If the March votes at Mountain View and Oregonian approve the merger, Cline said they expect the new entity to be operating "by the end of April at the latest."

For reprint and licensing requests for this article, click here.
MORE FROM AMERICAN BANKER