ROCKVILLE, Md. — Branchless-Realtors FCU, billed as the first virtual credit union when it was chartered by the National Association of Realtors three years ago, is throwing in the towel and plans to merge into Northwest FCU, the $2.2 billion credit union in nearby Herndon, Va.

Jane Pannier, president of Realtors, told the Credit Union Journal this morning the combination will allow the $76 million fledgling credit union to provide its 7,800 members with a "greater array of products and services" including access to more than 4,300 physical branches through a national shared branching network to which Northwest belongs.

The pending demise of Realtors demonstrates the difficulties in chartering new credit unions, even one as well-endowed as this one, which started out with a $10 million non-member deposit from the Realtors group and a potential membership base of two million association members nationwide.

Assets for the credit union, which operates out of a small administrative office in the Washington suburb of Rockville, Md., peaked at almost $90 million within two years of chartering, but have since fallen off to $76 million at March 31.

Like all start-up credit unions, Realtors has had a difficult time financially and has never accumulated any reserves, even though it reported $4.8 million in undivided earnings at the end of the first quarter, giving it a 6% net worth ratio. It reported losses of $2.6 million for 2010, $2 million for 2011, and $414,000 for the first quarter of 2012.

Realtors members will vote on the merger by electronic ballot and at a May 18 special meeting being held at the NAR's annual convention in Washington.

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