Skip to main content

Don't miss our opening session Saturday 10/1 in Denver.

We have a panel of 4 firefighter credit union CEO's, Michael Tobler, Linda Willams, Gene Benick and Wallace Garland discussing the reasons for and the pros and cons of mergers.

A Blog post from Tim Harrington, CPA
CEO, TEAM Resources

Did I just said the “M” word, Shhhhhh! We don’t want to talk about that. The leadership in the credit union movement treats merger talk as verboten. You don’t see much on conference agendas, or on webinars. And I get it – talking about it might come across as endorsing it, and there’s a school of thought that says that more credit unions are better for the industry.
Well…it’s no secret that there are a LOT of credit union mergers. According to the NCUA, there were 234 mergers in 2015, which actually represents a slowdown of late.
Which brings me (finally) to my point: Merging credit unions need to have extensive discussions about governance as part of the process. Cultural fit is one of the most significant issues for merging institutions and that starts at the top, with the board and this is a governance issue. I can’t count how many times I’ve talked to directors and consultants about mergers that failed because of incongruity among the board. As often as not, these are problems/failures AFTER the merger is complete. Too late.We must acknowledge that having stronger but fewer credit unions is better than simply trying to keep a large pool of charters and weak assets. Credit union membership is growing, as are the assets, despite the falling number of institutions.
  • Talk about what governance model you follow. (Carver Policy? Chait, et al? Hands on, old school?)
  • Where are you on the governance spectrum: Working – Managing – Governing – Rubberstamping – Failing
  • Align yourselves with some training, with everyone in the room and literally on the same page.
  • Discuss governance successes and failures that each group has had over the years. How did they get there? What were the results/changes?
  • Figure out exactly how the culture of each organization manifests itself and examine the differences.
If you have boards that are merging and you don’t address these issues ahead and head on, there will be bumps at the top that make waves that ripple larger and larger as they spread through the organization, causing bigger and bigger problems.

Tim Harrington, CPA



Comments

Popular posts from this blog

NCOFCU YouTube Video Minies

  https://www.youtube.com/playlist?list=PLT3lzRTXnHw4YHnT2TzILxP7Rfkjn0eT1  __ ______________________________________________ Check out NCOFCU's additional features: First Responder Credit Union Academy Podcasts YouTube Mini's Blog Job Board

Sunday Reading - 401(k) plans, explained

  Worker Nest Eggs       401(k) plans, explained Originally intended for corporate executives, the 401(k) is now, arguably,   the most famous section of the US tax code   and a staple in worker benefits packages and personal finance guides ( watch 101 ). Roughly 70 million Americans, with a total of more than $7T invested , use these long-term, tax-advantaged accounts to build toward a more secure retirement. Some critics claim that with 401(k) plans, companies offloaded the risk of retirement savings to workers without the training to avoid volatile portfolio mixes. Amid the 2008 financial crisis, many 401(k) plans lost over a quarter of their value , an event that hit those near retirement particularly hard. ... Read our full explainer on the plan...

Why credit unions need to be formulating a strategy for crypto & digital...

“The future of money isn’t coming – it’s here, growing at $4 trillion and accelerating,”  DaLand CIO, Jon Ungerland said in a statement. “Their solution ensures the institutions that matter most to American communities don’t miss the transition.” https://www.dalandcuso.com/videos-podcasts __ ______________________________________________ Check out NCOFCU's additional features: First Responder Credit Union Academy Podcasts YouTube Mini's Blog Job Board

Fed Gets Green Light for Interest Rate Cuts as Unemployment Rate Jumps to 4-Year High

The Federal Reserve is now seen as likely to   cut interest rates   multiple times before the end of the year, following another weak jobs report that showed unemployment jumping to a four-year high. The U.S. economy added just 22,000 jobs in August, less than economists had expected, the  Bureau of Labor Statistics  reported Friday. The unemployment rate rose to 4.3%, up slightly from 4.2% in July but hitting the highest level seen since October 2021, when the economy was still recovering from pandemic-driven layoffs. Although the new jobs report was troubling news for the economy, for prospective homebuyers with secure jobs it likely means further easing in  mortgage rates  in the days to come. Mortgage rates hinge primarily on the yields of  10-year Treasury notes , which plunged Friday to their lowest level since early April, when President  Donald Trump 's Liberation Day tariff announcement sparked panic in financial markets. It signals furth...

Open Banking Pushes Leading Credit Unions Ahead In Race For Member Loyalty

  https://youtu.be/pUIV8hwSDCE NEW YORK—Credit unions that embrace open banking aren’t just keeping pace with competitors—they’re pulling ahead, new data show. A new report finds that innovation in digital tools and personalized experiences is emerging as the decisive factor separating credit unions that win lasting member loyalty from those at risk of losing ground. “ The 2025 Credit Union Innovation Readiness Index: Closing Gaps, Winning Members ,” a June report produced in collaboration between  Velera  and PYMNTS Intelligence, underscores innovation as a defining factor for credit union success. iStock-Korakrich Suntornnites “Facing shifting expectations from both consumers and small to medium-sized businesses (SMBs) toward digital convenience and tailored experiences, credit unions must modernize not just to compete with traditional banks, but to remain relevant to their members. The report, based surveys of 500 credit union executives, 15,000 U.S. consumers, and nea...