Two California credit unions plan to merge into a $ 3 billion asset institution.
Valley Strong Credit Union in Bakersfield and Financial Center Credit Union in Stockton announced the deal on Friday; it should be completed this year.
If regulators approve the deal, the combined entity will operate as Valley Strong, have 27 branches, and serve nearly 200,000 members across the San Joaquin Valley, from Lodi to Tehachapi.
“This merger is a true embodiment of the cooperative mindset of the credit union industry,” said Michael Duffy, President and CEO of Financial Center in a press release. “Fundamentally, our partnership with Valley Strong allows us to select the best credit union partner to help us achieve our goals faster than we could duplicate them on our own.
Financial Center has approximately $ 600 million in assets and Valley Strong, $ 2.4 billion.
“As the CEO of Financial Center Credit Union over the past 21 years, my perspective on mergers has evolved as much as that of our industry over the same time period,” said Duffy. “As the credit unions started by certain groups of employees increasingly partner with community credit unions, I marveled at what credit unions of the current scale can accomplish.”
Duffy said the 2020 pandemic made it clear that now is the time for the Financial Center to find a counterpart with similar outlook and values.
Stephen Renock is expected to retire as CEO of Valley Strong on June 30.
Valley Strong CFO Nick Ambrosini will be the CEO of the combined organization.
“When I first sat down with Michael and started sharing our visions for our respective credit unions, everything felt right to me,” Ambrosini said in the press release. “Our partnership is rooted in the commitment and passion we have to serve our members. We are teaming up for the right reasons. “
Valley Strong reported first-quarter profit of about $ 5.9 million, up from $ 14,000 a year earlier, according to data from the National Credit Union Administration’s appeal report. Valley Strong’s profits fell sharply in the first quarter of 2020, when the pandemic began to put an end to the economy, a spokesperson said.
The Financial Center generated a profit of $ 690,000 in the first quarter, a decrease of 7% from the same period last year.