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Credit union merger volume down in Q2'16

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Credit union merger volume down in Q2'16

This Data Dispatch will be updated quarterlythroughout 2016 to tally NCUA-approved merger activity in the U.S. credit unionsector. Click herefor a spreadsheet listing all NCUA-approved credit union mergers since Jan. 1,2011.

The National Credit Union Administration approved 99 creditunion mergers in the first half of 2016. The regulator cited "expandedservices" as the reason behind 70 of the mergers and listed "poorfinancial condition" as the reason behind 16 mergers.

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For those 99 mergers through June 30, the surviving creditunions' aggregate assets as of merger approval totaled $100.87 billion,compared to an aggregate of $2.22 billion in assets at the merging creditunions — a ratio of about 45 to 1.

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By comparison, in the first half of 2015 the NCUA approved110 credit union mergers, citing "expanded services" as the reasonfor 80 of those. For the 110 mergers, the surviving credit unions' aggregatetotal assets as of merger approval were $66.40 billion, compared to the mergingcredit unions' $3.74 billion.

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The largest merger to receive NCUA approval in the secondquarter of 2016, in terms of the merging credit union's total assets, wasDexter Credit Union'sproposed merger into NavigantCredit Union. Dexter's total assets at approval were about $96.72million, compared to Navigant's total assets of $1.58 billion. The creditunions cited "expanded services" as the reason for the tie-up.

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In the first half of 2016, there were 26 merger approvals inthe Midwest and 17 in the mid-Atlantic.The Midwest holds the highest number of currently operating credit unionswithin S&P Global Market Intelligence's coverage — 1,771, or approximately29.46% of all credit unions in the U.S. The mid-Atlantic holds thesecond-highest number of currently operating credit unions — 1,124, or about18.70%.

From 2011 through the first half of 2016, the NCUA approved1,331 credit union mergers.

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