Local credit unions ponder merger
- Katie Wilson
- South County Spotlight - News
Wauna, St. Helens credit unions began talks of merger after CEO terminated
A possible merger is being discussed between the St. Helens Community Federal Credit Union and Wauna Federal Credit Union.
The credit unions have signed a letter of intent to explore a merger, according to recently ousted St. Helens board chair Charlotte Hart. Officials from both nonprofit institutions said they are financially stable and don't need to merge, but that a merger could provide more resources to all the members.
This revelation was made public at a packed St. Helens credit union annual meeting on June 26, where some attendees questioned the dismissal of its CEO Jeff Schwartz in May. Following his termination, both credit unions began discussing a potential merger.
"Both (credit unions) are profitable, both are very strong," said Wauna CEO and President Robert Blumberg. Together, he added, they could be stronger.
If the credit unions were to merge, any larger credit union looking to plant themselves in the area "might think twice," Blumberg said.
Nothing is set in stone yet. The credit unions are examining each other with the help of an outside consultant and there are a number of questions that must be answered before any decision is made, Blumberg said.
"If the discussions suggest there are no benefits to a merger, both credit unions will continue business as usual," said Lea Chitwood, the newly appointed chairperson for the St. Helens credit union board. She replaces Hart who was voted out, along with another board incumbent Darrel Purkerson, at the June 26 meeting.
A merger between credit unions is different from a merger between big banks, Blumberg and Hart said. The latter is usually considered a "take over," with one bank imposing its brand over another, said Mike Chapman, marketing director for Wauna.
In a credit union merger, "no one is taking over," Chapman said.
"In credit union land, it is a merger and it's collaborative and we do it together," Blumberg emphasized.
Hart and Blumberg said there would be no layoffs among current employees if a merger goes forward.
A merger would add Wauna's seven branch locations to St. Helens' three. It would also combine the credit unions' assets. Currently, the St. Helens credit union holds $166 million in assets; the Wauna credit union, $143 million.
In response to a question from the audience at the June 26 meeting, Hart told members that other credit unions had approached St. Helens about merging and the board was "keeping an open mind" and looking at its options.
The next day, in an interview with the Spotlight, she confirmed St. Helens was exploring a merger with Wauna, adding that she hadn't expected to discuss it at the annual meeting. There were several items mentioned by members at the public meeting that related to internal discussions not usually known to members, she said.
She believes a merger would be beneficial to the community, but it's an action that, if it goes forward, she will not be a part of.
At the annual meeting, more members than usual - over 100 - flooded the credit union's lobby. They chose not to re-elect Hart and Purkerson, instead electing past board member Tom Tussing and newcomer Michael Ismert. Current board member Lia Chitwood was appointed as the new chairperson after the meeting.
Hart had served on the St. Helens credit union board for over 20 years. In all her years on credit union boards, she said she never lost an election.
It had been one of the best financial years the St. Helens Federal Credit Union had seen in a while, but a number of members expressed dissatisfaction at the annual meeting.
The subject on many people's minds was the dismissal of former CEO Jeff Schwartz.
When Hart opened up the meeting to see if there were any questions about last year's reports, a man in the audience asked if she could address the firing of Schwartz and explain it to the members.
The room broke into applause. Hart paused then tried to continue the meeting. She asked again if there were questions about last year's reports.
"Do you want me to repeat it?" the man asked.
Because it was an employee matter, Hart explained, she couldn't legally discuss it.
Another man asked if Schwartz was let go because of performance. He gestured at the positive financial report and said, "That's good performance."
Hart has been acting as CEO since Schwartz's dismissal and would not comment on why he was dismissed except to say that the board acted within its legal rights according to a contract Schwartz signed when he was first hired.
Though she is no longer on the board, Hart will continue as acting CEO until July 9 when the new CEO Brooke VanVleet arrives. VanVleet will serve on an interim status as merger discussions continue, Hart said.