Self-Help, United Services credit unions merging

Oct. 01, 2013 @ 06:44 PM

In its seventh such deal in seven years, Durham-based Self-Help Credit Union announced a merger with United Services Credit Union on Tuesday that’s expected to mean a shift of some operations of the smaller, Asheville-based credit union to Durham.

While some United Services Credit Union’s administrative functions will move to Durham, David Beck, a spokesman for Self-Help, said all seven of its branches will remain open, and no layoffs are planned.

Founded in 1954 by a group of Mission Hospital employees, United Services Credit Union serves medical workers as well as workers of several additional industries, according to a news release.. It has $60 million in assets and nearly 11,000 members.

Self-Help Credit Union has 40,000 members, 10 branches, and pre-acquisition assets of $583 million. It’s the seventh-largest credit union in the state, according to Jeff Hardin, director of communications for the N.C. Credit Union League.

“The location, strong management, and tradition of service found at United Services are a great fit with our vision and existing branch network,” Self-Help Credit Union Executive Vice President Becky Holton said in a prepared statement.

Beck said this is the seventh acquisition by Self-Help Credit Union since 2006.

Other acquisitions were made in eastern North Carolina in Kinston, Wilmington, and Wilson, and in Laurinburg, which is in Scotland County. In addition, the credit union also acquired Carolina Mountains Credit Union, and also Choice Community Credit Union in Greensboro.

“For us and for the credit unions we’ve merged with, it’s just made sense to try and pool our resources and strengthen each other by expanding availability of branches to members and availability of services,” Beck said.

G. Donald Jud, a professor at the University of North Carolina at Greensboro, said in an email that because United Services Credit Union is smaller than Self-Help, he expects the larger intuition will dominate after the merger.

He said in an email that he expects that the credit unions expect to lower their expenses through economies of scale. Both institutions have low earnings as a percentage of assets, he said, but have “reasonable” net interest margins.

“The problem for both institutions is high non-interest expense,” he said in the email. “I suspect that a major motivation for the merger is to achieve some economies of scale which will lower the level of non-interest expense as a percent of assets, making for greater efficiency.”

Self-Help Credit Union is a subsidiary of the Durham-based Center for Community Self-Help. The parent nonprofit group, also based in Durham, has another credit union that operates mostly in California called Self-Help Federal Credit Union. In addition, it has a nonprofit loan fund, and a policy and advocacy arm called the Center for Responsible Lending.