Suncoast-Launch merger outlines blueprint for future large credit union deals

As smaller credit unions look for bigger partners to survive, the Suncoast-Launch merger could serve as a road map for the industry's future.

Suncoast CU is nearly 14x the size of Launch CU, by far the largest difference between asset size of buyer and seller among the largest 20 credit union mergers involving targets that have at least $1 billion in assets since 2014. The deal might encourage more larger, fast-growing credit unions to look at bite-size, slower-growth targets, according to ALM First Managing Director Brandon Pelletier, who advised on the deal.

"This is going to create more and more conversations in the credit union space," Pelletier said.

Suncoast CU

Competition prompts partner search

Suncoast's total assets have been growing above the median for the credit union industry every year since at least 2020. Launch had also grown faster than the industry for several years, posting a year-over-year asset growth rate of 15.9% between 2020 and 2021 and 28.2% between 2021 and 2022. However, this rate slowed to below 1% in 2023 and 2024.

That deceleration in growth led Launch to begin exploring a sale in March 2025, CEO Joe Mirachi said in an interview.

"The growth was just getting tougher to come by," Mirachi said.

Contributing to the slowdown was increased competition with Florida-based credit unions and those expanding into Florida from other states, the CEO said. Credit unions such as VyStar CU, with $13.72 billion in assets as of the fourth quarter of 2025, and Space Coast CU, with $9.12 billion in assets in the same period, are in Launch's local market, according to ALM's Pelletier.

"It's difficult to compete with these large institutions," Pelletier said.

At the same time, Launch's technology, cybersecurity and fraud prevention costs were increasing and lowering margins.

"We just don't have the scale to spread those costs," Mirachi said.

When Launch began finding partners, it sought a financially strong and competitive credit union with an established CEO who planned to stay on for about another five years and a footprint that made sense, Mirachi said.

The search went nationwide, Pelletier said. He was inspired to expand the geography of his search by cross-state deals such as Marlborough, Massachusetts-based Digital Federal CU's deal with San Jose, California-based First Technology FCU and Colorado Springs, Colorado-based Ent CU's merger with Apple Valley, Minnesota-based Wings Financial CU.

Eight of 22 identified partners engaged in preliminary deal talks, and Suncoast emerged as the winner.

Mirachi was surprised that a much larger institution was interested in a deal with credit union of Launch's size. Suncoast had around $18 billion in assets during the deal talks.

Suncoast checked the boxes on culture and financial strength, Mirachi said. Both are community development financial institutions, serving low-income communities with a focus on economic development.

Launch's footprint on Florida's east coast is a natural expansion of Suncoast's footprint, Mirachi said. Launch will add 14 branches to Suncoast's 81 branches that run from Orlando to the Gulf Coast.

Suncoast's story

The deal is Suncoast's first in more than 20 years. Suncoast's return to M&A comes as smaller credit unions are becoming more open to mergers, CEO Kevin Johnson said in an interview.

"The smaller credit unions just feel like you have to be a certain size, and they're correct," Johnson said.

Suncoast is currently the seventh-largest depository in Florida, but the addition of Launch will push it to sixth, above Seacoast Banking Corp. of Florida.

With the addition of Launch's approximately 86,000 members, the combined entity will have a membership base of close to 1.5 million. Suncoast is working on a goal to reach 2.5 million members by 2030.

"We still have a ways to go, but we have had a very aggressive growth the last six to eight years," Johnson said. "I wouldn't take another future merger opportunity off the table."

Targets that provide geographic expansion in or out of Florida are attractive, Johnson said, adding that geographic diversity would help with resiliency.

Suncoast has achieved its rapid growth without M&A, more than doubling its assets between 2018 and 2025. The credit union attempted to acquire Apollo Bank in 2019, but the deal was terminated in 2020 amid the COVID-19 pandemic. Its attempt to acquire GTE FCU in 2009 was also terminated.

Johnson said his team's desire to try to acquire a bank in the future has diminished.

"It's much more expensive to acquire a bank than to merge with a credit union," Johnson said. "I'm not saying there's not any that would still make sense, but a lot of them have already found partners."