ST. JOSEPH, Mich.-United FCU, which is in the process of acquiring nearby Griffith Savings Bank, said it has had all depositors in the troubled Indiana S&L join the American Consumer Council to facilitate the rare credit union deal.
The San Diego-based consumer group boasts more than 100,000 members in 44 states, with 22 credit unions-including United FCU-offering free membership in the council as a select group.
Gary Easterling, president of the $1.3-billion credit union, said having the depositors of Griffith Savings join the ACC will help satisfy the field of membership issues related to the rare merger.
United, a conglomeration of former Whirlpool Employees FCU and First Resources FCU, has agreed to acquire the $85 million S&L, located about 90 miles away in northeast Indiana, in what is believed to be the first federal credit union acquisition of a bank.
The deal, which has been approved by the boards of both institutions, still is awaiting approval from NCUA and the FDIC, which insures deposits at the 73-year-old S&L, according to Easterling.
Easterling said deal was initiated by Griffiths, which is under an FDIC supervisory agreement and has been looking for a merger partner.
"They approached us," Easterling told Credit Union Journal. He said he is confident the unusual merger will be approved by both credit union and bank regulators because it will not cost either of the overburdened insurance funds anything. He said the cost to United will be minimal because the assets of the troubled S&L are being purchased at a discount.
Terms of the deal call for Griffith's loan branch to become a branch of the Michigan credit union, which has 22 offices in Michigan, Nevada, Arkansas, North Carolina and Ohio.
United has a recent history of acquiring troubled institutions, including 2009's deal for Clearstar Financial CU, a one-time $175-million Reno, Nev., failure.
