... has merged
with ...
Dogwood State Bank, a strong Raleigh-based, North Carolina community bank, announced yesterday that it was merging with Towne Bank, which is headquartered in tidewater Virginia [here read the details at BusinessNC].
The combined bank will have assets of @$22 billion. The owners of Dogwood bank did well, selling the bank for $476 million - around 2.2 times the net worth of the bank!
So lets take a look at why credit union member-owners nationwide should strongly oppose having their credit unions given away through mergers with other credit unions. It's "bad business" all the way round!
Using SECU as our example, we have a financial institution owned by @ 3 million members, mostly from North Carolina. SECU has assets of @$55 billion and a net worth of @$6 billion. SECU also has a well-established service network, experienced staff, and has had in the past a reputation for integrity and fair dealing.
Using the "2.2x net worth" purchase price benchmark in the Dogwood/Towne Bank merger, the market value of SECU to its member-owners would be @$13.2 billion (2.2 x $6 billion net worth)! Each of SECU's 3 million members would be entitled to a payout of @ $4,400. That would represent quite a wonderful boost for individual SECU members as well as the North Carolina economy in general!
😎 That prosperous credit unions nationwide are being merged without ownership interest payouts to the members is financial foolishness. CEOs and Boards which recommend such transactions should be held accountable - and prosecuted if possible.
✅ The financial best interests of members are being misrepresented. The members are being hoodwinked.
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