Seacoast credit unions finalize plans to merge
Service Credit Union now ranks 69th largest in nation
By Michael McCord
Seacoast Sunday, June 19, 2011
[The following article is courtesy of Seacoast Sunday and Seacoast Online.]
[Rich Beauchesne Photo]
PORTSMOUTH -- The announced merger last week of two Seacoast credit unions was one part preservation and one part opportunity.
Service Credit Union and Seacoast Credit Union will officially join forces July 1. This came after 83 percent of the approximately 5,300 members of Hampton-based Seacoast Credit Union voted to approve the merger recommended by the boards of both organizations on Monday.
"This is really good news," said Gordon Simmons, president and CEO of the much larger Service Credit Union. The two Seacoast Credit Union branches in Exeter and Hampton will join the 18 Service Credit branches in New Hampshire, one in Massachusetts and 16 on U.S. military bases in Germany.
The merger also met regulatory approval from the New Hampshire Banking Department and National Credit Union Administration. Seacoast Credit Union, which was formed in 1966 and has $36 million in assets, began merger discussions with Service Credit Union ($1.6 billion in assets) in February, said Joanne Nadeau, president and CEO of Seacoast Credit Union. She said that Service shared the same member service philosophy as Seacoast, offered more financial products that their members sought, had more locations and longer hours of service and, from a safety and soundness position, was financially strong.
"We are now able to give our members the convenience and technology they are looking for," Nadeau said. "It's a good partnership and a good fit."
Simmons and Nadeau acknowledged Seacoast Credit Union was facing a challenging economic environment as a smaller institution that might make it vulnerable to a reduced return-on-assets ratio, an important benchmark, and not allow it to make the depth of technological investments necessary to compete.
"Our board believes in helping small credit-unions stay in—business," Simmons said, but sometimes "opportunities to improve" and survive come best through a merger.
Simmons said Service has had six mergers since its founding at the former Pease Air Force Base in 1957. The most recent was in 2008, when it merged with the former Salmon Falls Credit Union, which had $13 million in assets.
The enlarged Service Credit Union will have more than 147,000 members and 500 employees worldwide. Simmons said all 14 Seacoast Credit Union employees, including Nadeau, who will have a new senior management position, will keep their jobs.
"Seacoast was a well-managed company that offered great service," Simmons said. Because Seacoast chose to pursue a merger long before any solvency issues could emerge, Simmons said "this is a merging of strengths."
Nadeau said that Seacoast members will now have access to a much wider range of services and technology than the smaller organization could have ever hoped to provide. This includes seven-day banking at Walmart locations, remote servicing through free online and mobile phone banking, remote deposit, mobile phone apps, and personal finance management online program.
In particular, Nadeau said, Service has free 24/7 personal service by phone, online chat or secure e-mail.
"It's become more difficult, especially over the last several years, to keep up with technology and providing all things to our members," she said. "They (Service) are able to do it."
Simmons said Service Credit Union has grown to become the 69th largest credit union among 7,400 in the country.
"We've kept pretty well hidden," he said about Service's high rankings in asset, deposit and member growth while also having one of the lowest loan delinquency rates in the country.
New Service Credit Union signs for the Exeter and Hampton branches are scheduled to go up around July 1 and Simmons said the complete integration of member data from Seacoast to Service will be completed by around Oct. 1.