Credit union mergers are expected to continue at a rapid pace in the years ahead. Due to today’s tough market environment and rising regulatory compliance costs, many credit unions have chosen to merge with other credit unions to improve their bottom lines and create greater economies of scale.
Over the past 5 years, 1243 credit union mergers took place nationwide. There were 846 small credit unions mergers with less than $10 million in assets, accounting for 68.1% of total mergers. The combined assets of the merged-away credit unions under $10 million in assets totaled $2.4 billion, representing 7.4% of total assets of all merged-away credit unions prior to mergers.
Even though there were only 9 merged-away credit unions with asset size over $500 million (3 out of 9 mergers were over $1 billion in assets), total assets of these credit unions totaled $10.5 billion, equivalent to 32.4% of total assets of all merged-away credit unions. Data show that small credit unions were the leading participants of all credit union mergers nationwide while large credit unions were more likely to remain status quo.
MERGERS OVER THE PAST 5 YEARS:
NUMBER OF CREDIT UNIONS AND TOTAL ASSETS BY ASSET SIZE
Data As of March 31, 2013
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