Bank sales to credit unions are investing in people, communities

Community banks choose to sell to credit unions because it’s often the best transaction for the community and both institutions. New articles published Monday by the GoWest Credit Union Association debunk bank claims about bank sales to credit unions. America’s Credit Unions President/CEO Jim Nussle also has a new op-ed in RealClearPolicy combatting other misleading arguments from banker associations.

Responding to a recent article in American Banker, GoWest President/CEO Troy Stang provides the full picture of these transactions, noting that in the past 13 years 2,499 banks were purchased by other banks, but only 100 banks sold to a credit union over the same period.

“It's disappointing when some choose to frame a community bank selling to a credit union as problematic. The bigger question that should be investigated is why small local banks are selling in the first place as large mega-banks continue to dominate the financial services landscape,” Stang wrote. “Credit unions offer real value to communities. And when they buy a community bank, it's not about acquiring assets, it's continuing a legacy, investing in people, and serving members with a mission-driven, community-focused approach.”

Since 2012, 67% of sold bank assets have gone to out-of-state banks (with a number closer to 90% in Oregon, Washington, and Colorado, three states GoWest represents). In Banking Dive, GoWest details why community banks sell to credit unions in some rare and unique circumstances.

“Some small community-focused banks have chosen to actively pursue credit unions as buyers, since there is more alignment on community investment and interest in protecting jobs and access to local branches,” the article reads, adding that the member focus, relationship to the community and retention of branches and employees increases access to services instead of creating a new banking “desert.”

The America’s Credit Unions resource library offers handouts and research to help address banks selling to credit unions.