Dive Brief:
- Grand Blanc, Michigan-based ELGA Credit Union has agreed to acquire Vero Beach, Florida-based Marine Bank in an all-cash transaction that’s expected to close in early 2025, the institutions announced Tuesday.
- The acquisition will give ELGA seven added locations — five banking centers and two loan production offices — and diversify the credit union’s offerings to include commercial banking and treasury management. ELGA specializes in low-income lending.
- The purchase price was not disclosed, but Marine Bank investors will receive $43.75 for each share they hold, the credit union said.
Dive Insight:
The acquisition of $650 million-asset Marine Bank by $1.5 billion-asset ELGA marks the 12th proposed whole-bank purchase by a credit union so far in 2024. That puts this year ahead of last year’s 11 proposed credit union-bank tie-ups — with more than six months to go. The year appears well on pace to shatter the record 16 such deals announced in 2022.
It's the fourth deal this year involving a credit union based in the Midwest.
Incidentally, the Michigan-Florida pipeline has been perhaps surprisingly fruitful in recent years. ELGA isn’t even the only credit union in Grand Blanc (population 7,800) to buy a Florida bank. Cross-town neighbor Dort Financial Credit Union completed its acquisition of West Palm Beach-based Flagler Bank in December.
Two years earlier, Grand Rapids-based Lake Michigan Credit Union bought Tampa-based Pilot Bank for roughly $97 million.
Terry Katzur, ELGA’s CEO, called the deal a “highly complementary transaction.”
“As a community development financial institution, the root of all ELGA CU's member interactions is our focus on personalized solutions that meet the demands and address the issues of our members and the communities we serve,” Katzur said in the release. “Marine Bank is aligned with us in that approach.”
ELGA has pledged to expand Marine Bank’s philanthropic efforts throughout Vero Beach and other communities within its reach — and to maintain all of the lender’s banking centers and jobs. That includes Marine Bank CEO Bill Penney, who will continue as ELGA’s Florida market president after the transaction closes.
“This transaction is an exciting opportunity for Marine Bank to join forces with a like-minded, locally operated organization that shares our values and our commitment to the communities and residents we serve,” Penney said in the release. “With its wealth of knowledge serving communities and individuals that don't typically have access to banking services, we will be able to expand our base of customers in east central Florida.”
The acquisition of banks by credit unions has long been a source of frustration for banking trade groups, which argue that tax-exempt credit unions can offer higher purchase prices than taxpaying banks. But trade groups also assert that some of the transactions — particularly those that cross state lines — run counter to credit unions’ traditionally local focus.
In a February post on X, formerly Twitter, the Independent Community Bankers of America said 20% of bank acquisitions “are now by tax-subsidized credit unions, and each one increases the portion of the financial services industry exempt from [the Community Reinvestment Act] and taxation.”
Apart from the 12 whole-bank acquisitions by credit unions this year, three credit unions in 2024 have announced their intention to buy partial bank footprints.
