When Waltham’s RTN Federal Credit Union absorbs Brookline-based MAFCU Federal Credit Union in a merger effective Aug. 1, it will just be the latest of Massachusetts’ larger credit unions to snap up a much smaller competitor.
MAFCU’s members recently voted to approve the merger, in which only the RTN name survives and all MAFCU employees keep their jobs.
Thomas J. Weikle, RTN’s director of communications, told Banker & Tradesman that even though RTN hasn’t been part of a merger in about six years, “our institution is always looking for opportunities.”
MAFCU members get “more branches, lower fees and greater convenience” in the deal. MAFCU – the MA is for “Medical Area” – has two branches in Brookline and Dorchester, and assets of about $51 million.
What RTN sees in MAFCU is a growing credit union with good demographics and “stronger borrowing” numbers than RTN, Weikle said. “And the two branches allow us to get into some nice, attractive markets in Brookline and Dorchester Lower Falls.”
RTN was started just after World War II as the credit union for Raytheon employees. It has assets of $717 million and 38,000 members. It has branches at Raytheon locations, as well as in Waltham, Amesbury, Danvers, Lawrence, Marlborough and Tewksbury.
That’s a pretty good swath of territory, and it helps that the two institutions have enjoyed a working relationship for a number of years.
“We have informally partnered in many ways for a while,” said Sarita Ledani, MAFCU vice president of business development and marketing. “The way was paved long before either institution ever considered (a merger).”
A Lot Of Competition
With the institutions merged, MAFCU members will get “expanded choice of mortgage loan products and a larger ATM network, all with better rates and lower fees,” MAFCU said in a statement.
“There’s really only so many ways you can grow,” Ledani said. The merger is “just a way to be able to expand what we offer.”
“There’s a lot of competition out there,” Weikle added. “A lot of smaller credit unions are merging into larger credit unions if they have good fundamentals. You have to look at your demographics, look at your own future down the line.”
In recent months, other similar mergers have been announced. Most recently, Chelsea-based Metro Credit Union, one of the state’s very largest credit unions, proposed merging with the Massachusetts State Employees Credit Union.
Worcester-based Webster First Federal Credit Union got the green light in April for its fourth merger in the past year. It expects to acquire 78-year-old, 1,700-member, $20 million Filene Federal Credit Union.
On the other hand, HarborOne Credit Union, another of the state’s largest, is seeking approval for conversion to a mutual bank charter.
Also, Gardner’s GFA Credit Union is in the process of acquiring tiny, troubled Monadnock Savings Bank. Chicopee’s Polish National Credit Union is in the process of merging with Valley Stone Credit Union.
Email: mbrown@thewarrengroup.com
