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Springfield-based Arrha Credit Union and Pittsfield Cooperative Bank are seeking to merge, with the credit union folding into the bank.
The application for the merger is currently under review by the National Credit Union Administration, a spokesperson for the federal credit union regulator said. The Massachusetts Bankers Association provided comment, clarifying that Arrha will be merged into Pittsfield.
“While we are unable to comment on specific bank transactions, we are always pleased to see FDIC-insured banking institutions in Massachusetts grow,” Massachusetts Bakers Association president and chief executive officer Kathleen Murphy said. “Mergers and acquisitions present opportunities for banks to achieve greater economies of scale and, as banks grow, it is testament to the strength of the industry and great support our members provide to local communities throughout the Commonwealth.”
Any credit union insured by the National Credit Union Share Insurance Fund (NCUSIF) must receive approval from the NCUA before purchasing loans or assuming an assignment of deposits, shares or liabilities from any credit union that is not insured by the NCUSIF or any other financial institution (including depository institutions, mortgage banks, consumer finance companies, insurance companies, loan brokers and other loan sellers or liability traders) according to NCUA regulations.
A credit union seeking approval must submit a letter to the regional office with jurisdiction for the state where the credit union is headquartered.
“The NCUA will make a decision to approve or disapprove the request as soon as possible depending on the complexity of the proposed transaction,” NCUA regulations state.
Arrha has three branches in the Springfield area, including a branch in Connecticut, and has 9,000 members amounting to $138 million in assets according to its website. Pittsfield Cooperative Bank has been in operation for over 100 years and has five branches, four of them in and around Pittsfield. Pittsfield Cooperative has approximately $381 million in total assets according to FDIC data.
“Pittsfield Cooperative Bank believes that combining with Arrha Credit Union will create economies of scale and an expansion of services for their members and our customers,” J. Jay Anderson, president and CEO of Pittsfield Cooperative, said in a statement. “We cannot comment further until the institution’s Board of Directors releases its members’ comments and merger voting results sometime next month.”
The merger and acquisition market continues to be active. Boston’s Eastern Bank recently completed its merger with Cambridge Trust while Dedham Savings and Weymouth’s South Shore Bank saw their holding company’s merge at the beginning of 2024 and Holyoke-based PeoplesBank proposed to join its holding company with that of Southbridge-based Cornerstone Bank. And many of the state’s smallest credit unions have spent the last several years merging or being acquired by larger competitors as operating costs continue to increase, a trend that also helped rocket Merrimack Valley Credit Union into the the ranks of the five biggest credit unions in the state last summer.
Editor’s Note 4:59 p.m. Aug. 22, 2024: This story has been updated to include comment from the Massachusetts Bankers Association.
