Tyfone, Inc.’s Post

Thanks to Ray Birch at CUToday for highlighting a significant trend that is likely to become even more profound in the future - assets acquired by credit unions in bank acquisitions exceeded those of CU2CU mergers. Already in January of this year we have seen two of the largest CU-Bank acquisitions by Hudson Valley Credit Union and Global Credit Union, totaling over $2B in Assets. #creditunions #banking #mergers CEO Advisory Group

I'm with you Ancin Cooley, CIA, CISA so many of these credit union mergers feel icky. I focus my spare time on helping groups that want to start new credit unions and that is the opposite of icky. But guess what they lack? Sufficient capital to open their doors...and yet.....what if credit unions in the US were like cooperatives in Italy and we were required to contribute 3% of earnings to use as capital to start new cooperatives (credit unions). . . .hmmm....that's the credit union difference. #peoplehelpingpeople

While bank mergers have slowed credit union mergers continue to pick up steam. What does it mean to you, your job, your career, your company? If a bank does sell often times the buyer is a credit union. Here are some questions to consider as we all try to understand this growing trend: 🔹 Will their members approve all these mergers or will more be like the Centra -Hoosier Hills merger that was voted down (see article in comments) by its members? 🔹 Will they continue to buy more community banks where the members can't vote them down and they get commercial and treasury acumen (see post in comments section)? 🔹 Where will the must have size for a credit union be to in order to survive in this new age? 🔹 Will credit unions be able to maintain their non-profit status as they become more bank like? What culture fits your goals best a bank or a credit union? Are the differences becoming smaller? How can your company hire strong talent from credit unions in this process and take advantage of the opportunity? #mergersacquisitionsdivestitures #mergersandacquistions #mergers #bankingindustry #banking #banks #creditunions #creditunion #career #careerplan #jobsearch #jobgrowth #growth #businessbanking #commerciallending #treasurymanagement

When Mergers Hide the Mess... Ever wonder why some credit unions merge? Spoiler alert: it’s not always about economies of scale or regulatory hurdles. Sometimes, it’s just plain ol’ ineffective management and weak board oversight. Take, for instance, a recent merger that went down on June 30th. This credit union’s CEO had been at the helm for over 20 years. Candidly, the first decade of his administration was amazing. However, the last decade saw a nosedive in asset quality and earnings, thanks largely to a mismanaged indirect auto and unsecured signature loan portfolio. And it wasn’t a sudden plunge—this was a slow, steady decline that could’ve been reversed if the CEO or Board had taken decisive action. But the CEO sought an exit instead of facing the music or making the required changes. He reached out to a billion-dollar credit union, arranged a sweet post-merger payout, and launched a slick marketing campaign to convince both members and the board that merging was the only option. It’s like using fire to cover up a crime – in this case, the poor performance was the crime, and the merger was the fire that erased the evidence. (Interestingly, I am referring to a specific credit union, yet this scenario could easily apply to about 40 mergers over the last two years.) If you’re a CEO looking at your June 30 numbers and have concerns about your earnings, liquidity, asset quality, or regulatory changes, remember that there are numerous ways to be part of the solution that allows your charter to survive and thrive. I want you to retire happy, healthy, well-compensated, and with your charter intact. Bet on yourself... If your strategic planning and operational consultant can’t adeptly discuss the unrealized losses in your investment portfolio, the potential additional allocations to your allowance, the weaknesses in your talent pipeline, the rising risks in your MBL portfolio, and the need to lower the average cost of acquiring new members—all while incorporating these elements into your strategy and operating plan—then what are we doing? SWOT analysis and big hairy goals just aren’t enough anymore. Experience the difference. Contact us today to schedule an exploratory conversation. #AskSynergy #ExperiencetheDifference

🌟 BREAKING NEWS 🌟 Big changes in the credit union world! 🏦 Launch Credit Union and Community Credit Union of Florida have announced a merger, combining resources to better serve their members. With the tough operating environment for smaller credit unions, could this be the beginning of a trend? 📊 📰 Read all the details here: https://bit.ly/3MBpgdw #CreditUnionMerger #FinancialServices #CreditUnionNews #Tyfone

Exciting news for Alberta! Servus Credit Union and connectFirst Credit Union have officially merged into one entity today. As a key stakeholder in the merger, Servus Credit Union continues its tradition of trailblazing milestone mergers over the past 25 years. The merger brings back memories for this individual, who recently stumbled upon a column they wrote for Canada's National Credit Union magazine, Credit Union Way, back in 1998. Eric Eggertson and Anne Schneider offered a much younger, idealistic, and less grey version of me the opportunity of writing a column for board members on governance and industry issues (I still can’t believe they offered me such a platform). This article, titled "A Future Marriage," explored the bold merger proposition put forward by BMO and RBC. Reading it again, the author couldn't help but think about how the merger of Servus Credit Union and connectFirst Credit Union is the type of merger they had pondered way back then and how proud I am to have been part of the team that helped make today a reality. As the saying goes, "all good things come to those that wait." This merger is yet another giant leap forward for Servus Credit Union, a pioneer in advancing Canadian Credit Union mergers. Congratulations to the entire team at connectFirst Credit Union and Servus Credit Union on this exciting development. Here's to more exciting developments in the years and decades to come!

Blue Ridge turned down M&A offer and is sticking with a recapitalization deal — Great reporting from Lauren Sullivan Seay and Yizhu Wang "Blue Ridge Bankshares Inc. is aiming to push its pending recapitalization over the finish line and walked away from a potential purchase offer from Southern BancShares." "Late in 2023, Mount Olive, NC-based Southern BancShares offered to acquire the Charlottesville, Va.-based Blue Ridge, which is under a regulatory consent order, for between $4.50 and $5.50 per share. Southern's offer was contingent upon the company being able to raise additional capital to support the transaction, with the raise to be partially backed by the Holding family, which leads First Citizens BancShares Inc. and has two members on Southern's board." "Blue Ridge's leadership has set a March 6 shareholder vote on the company's previously announced $150 million recap, which is being led by private investor Kenneth Lehman as well as Castle Creek Advisors VIII LLC." "The company's shareholders will face dilution through the recapitalization, which calls for the issuance of 60 million new common shares, more than triple the company's current 19.2 million outstanding, at $2.50 per share." "While Southern's acquisition offer presents a higher price than the pending private placement, price is not the only factor companies weigh when making strategic decisions. Other considerations sellers often take into account include the buyer's acquisition history and the prospects that the sale would receive regulatory approval." https://lnkd.in/eqf9Gy-R

Buyers and sellers acting in good faith should clearly define the #contingencies at issue, how to #measure them particularly the responsible #internal factors; recurring or one off events; emotional versus logical analysis. #LBO #middlemarket #M&A #negotiations #blackswan #earnouts

Great article regarding earnouts when businness owners considering sale of their business.

💥 Attention #BCBusiness owners — you've probably heard of the contractual entity known as an "earnout," but its complexity runs deep, meaning there are many ways for an earnout to go sideways, potentially hurting both the buyer and the seller of a business. 💼 💸 Fundamentally, an earnout is used in a mergers and acquisitions deal when the buyer and the seller of a business have different opinions regarding the company’s valuation, both at the time of the sale and its post-acquisition potential. However, their incorporation into M&A contracts has increased notably in recent years due to significant ebbs and flows in the marketplace and the state of these types of deals. Clark Wilson LLP Family Office partner David Ford JD FEA was interviewed by Canadian Family Offices for their new article, “Buying and selling a business: ‘Earnouts are the new reality’“. In this article, David comments on some key factors he advises clients to consider when approaching such opportunities, and how to protect your interests in these transactions. Read the “Buying and selling a business: ‘Earnouts are the new reality’“ article here: https://bit.ly/4ayb8MR #BCBusiness #FamilyOffice #FamilyBusiness #MergersAndAcquisitions #BusinessSuccession #SuccessionPlanning #Earnouts