For Better or Better: Merger Unites Two Equals

As witnessed recently, proposed mergers always create a stir. But what happens with the newly-unified credit union after the frenzy dies down?

 
 

Henry Ford once said, “Coming together is a beginning; keeping together is progress; working together is success.” This quote is not only a popular wedding toast, but also illustrates the importance of working well together beyond the initial union of companies, groups, or people.

There has been a lot of attention regarding the recent announcements of mergers. The possible combination of four Colorado credit unions is drawing a lot of attention as well as the potential merger of two large Washington state credit unions. However, while mergers generate interest at their engagement, not enough people are exploring what happens beyond the initial merger’s honeymoon period. Below is an example of a credit union that has seen success from start to finish.


A Union of Two Equals

A little over one year ago Necheshuntsman Credit Union with $137 million in assets formed through the merger of Neches Credit Union and Huntsman Credit Union in Port Neches, TX. The deal was a merging of two equals, as each credit union had assets of $65 million in assets at the time the deal was finalized.

“Everything we thought we would get out of the merger we did,” said CEO Jason Landry.

The post merger strategy included keeping all branch locations open and retaining all employees. Landry felt it was important members could access the same locations and member service representatives they were accustomed to seeing. In fact, the credit union has since increased the number of employees by 24 percent.

Knowledge is Power

When asked what really made the merger an overall success, Landry cites the importance of keeping everyone informed. Necheshuntsman executives met with all employees to explain the possible impact and what was going to happen next. Additionally, anytime managers felt that the staff might be breaking down they would meet as a group to discuss concerns. Landry also said the credit union makes a point to hold a myriad of activities involving the entire staff. These activities include a luau party, general training, mock presentations, and other social events.

Landry’s post merger strategy is best summarized by the following quote:

“To make a merger a successful you need your employees behind it; 60-80 percent of the attention should be placed on employees and the board. Everything else will come together, so focus on the people.”

By creating a cohesive community of the merged staff Necheshuntsman has managed to make their employees the driving factor of the merger’s overall success.

 

 

 

Feb. 21, 2005


Comments

 
 
 
  • Within 12 months of a merger an ROA is going to be overstated because the average assets is based on one post-merger asset datapoint, and one pre-merger asset datapoint lowering the relative denominator - but a combined net income figure.
    Anonymous
     
     
     
  • great topic, just needed more info
    Anonymous