Two Biggest Thrift Groups Are Expected To Tie Knot
WASHINGTON -- The two largest thrift trade groups are likely to approve a long-expected merger next Tuesday, according to officials close to the negotiations.
The two groups -- the National Council of Community Bankers and the U.S. League of Savings Institutions -- have been holding talks for eight months.
Their combination would give the thrift industry a single national trade association for the first time since 1920. It would come at a time when cash-strapped members are increasingly reluctant to pay dues to competing organizations performing similar functions.
"I think there's a strong desire on the part of both parties to do the deal," said one state association executive, who did not want his name mentioned.
"As of now, I believe it is going to go through," said Anat Bird, a consultant with BDO Seidman, New York, who has been advising the U.S. League.
The executive committee of the National Council -- formerly the National Council of Savings Institutions -- is expected to approve a merger at a meeting in New York on Sunday. Two days later, the full National Council board will vote on the plan.
Also on Tuesday, the U.S. League board is expected to approve the merger at a meeting in Chicago.
The plan would also be subject to ratification by the groups' members, and the debate could be highly contentious.
"They've still got a bit of a sales job ahead of them. There's no automatic warm, fuzzy feeling between these groups," said one association official.
Sources said the consolidation process could begin within one month and be complete by May or June.
Both associations have been plagued by dwindling revenues and roughly 50% declines in membership. The league now has 2,000 members, the council 350.
There are strong attractions for both sides. Though it has tried, the National Council, which had its roots in the mutual savings banks of the Northeast, has never become a truly national body. At its peak, it had members in 37 states; now only about 27 states are represented.
The league, which initiated the merger talks, has suffered image problems in recent years and is said to want to share the National Council's reputation as a credible and progressive voice for the thrift industry.
Who would lead a merged group is far from clear. Mark J. Riedy, National Council president for the past three years, has launched an all-out campaign to snare the top job.
The league's president, Frederick L. Webber, declined to comment on whether he wants the job, but sources close to the league say he does. He joined the league in 1988.
Mr. Riedy's campaign has taken him to California, where he met last month with Jay Janis, president of the influential California League of Savings Institutions, and James F. Montgomery, chairman and chief executive of Great Western Financial Corp., Beverly Hills, a member of the negotiating team.
On Wednesday, Mr. Riedy went to Ohio to meet with U.S. League chairman Donald Shackelford, who is chairman of State Savings Bank of Columbus. Mr. Riedy has also visited David F. Holland, chairman of Boston Federal Savings Bank and a member of the merger task force.
"He's lobbying big, big time," said a source close to the negotiations.