By Ginny Brady
Many of you know that I serve on the board of directors of a small credit union in Northern New York State. The UFirst FCU management and board have initiated a number of changes to our credit union within the last 10 years. We have implemented a community charter, changed our name and, in the summer of 2008, we built and moved to a brand new main branch. We were ready for this move and it has proven to be a tremendous success. It has been thrilling to realize one of our key strategic goals. We believe that the move has positioned us to grow and to provide more services to our small but vibrant community.
UFirst FCU management team and the board of directors have developed a synergy throughout our years of working together. Our strategic plan is well thought out and includes actively working with other credit unions to leverage our services for mutual benefit. This cooperation has included educational efforts, shared staff trainings and community service. With the help of our board consultant, Phil Frani, we have also planned for and remained open to joining with a merger partner to strengthen our position in the financial marketplace. This goal started to become a reality when the CEO of Northern Corridor Community FCU informed our CEO and other credit union CEOs that Northern Corridor FCU's board and management had decided to seek a local merger partner. We were invited to a discussion with them to explore how this move could be of mutual benefit. In May their board adopted a resolution to initiate a merger with UFirst FCU. NCUA gave their consent to our merger on July 21, 2009, and the membership of Northern Corridor FCU voted their approval on Aug. 11, 2009.
Mergers have generated some controversy in the credit union world in the recent past. George Hofheimer of Filene Research Institute wrote an interesting blog post in February of 2008 entitled “Pre-emptive Mergers.” He observed, “…U.S. credit union mergers seem to be less strategic and more opportunistic. According to the forthcoming research, there is almost always a credit union in a position of power (the acquirer) and a credit union in a position of weakness (the targets). Over the past 26 years we observe very few merger of equals like we observe in Canada.”
If one looked at a map of Clinton County, N.Y., it would be clear Northern Corridor FCU’s branch locations are concentrated in the northern tier of our county along the Canadian border. It was clear from the start of our dialogue that this merger was mutually beneficial. Northern Corridor FCU has strong capital, a loyal, well-established membership base, a wide array of products and services and an excellent board and staff. UFirst FCU offered Northern Corridor FCU similar benefits as well as a branch location in a population center, additional strength in loans and a more developed marketing strategy. When the balance sheets and income statements of both credit unions are placed side by side the similarities are striking.
The conversation we had at a joint board meeting revealed how well we were matched in the culture and goals of our respective credit unions. UFirst FCU has spent much of our board time in the last year on board governance policies and strategies. We learned that Northern Corridor FCU developed board job descriptions as well as an orientation process and packet for new board members. We agreed that, although our proposal was that Northern Corridor FCU would be merging into UFirst, we would be partners in this process. Their operations manager would join our management team, we would expand our board of directors to include members from Northern Corridor FCU and we would utilize the Northern Corridor FCU data processing system for our daily operations. The geography and make-up of our community gives further support to this merger. Many of our individual members share employers, places of worship and educational institutions. It is indeed a good fit.
The last three months have been very exciting for the boards, management teams and staffs of both credit unions. UFirst FCU and Northern Corridor FCU have spent much of that time organizing and planning the transition. On Oct. 1, we will launch our new UFirst FCU. We're proud to be providing our community with an even stronger option to join the credit union family.
Ginny Brady has been a credit union member for over 15 years and serves as a member of the UFirst Federal Credit Union Board of Directors. She has held the position of board president and is currently the vice president of the board. Ginny was awarded the 2008 Volunteer of the Year Award by the Credit Union Association of New York. She has also completed the CUNA Volunteer Leadership Program and received the Blue Diamond Certificate. She has developed a board of directors blog, The Boardcast.
