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In the world of mergers and acquisitions, there is a new twist: credit unions buying banks. Since 2011, there have been less than 10 deals recorded and one of them occurred in our local market. In May 2016, Buckeye Community Federal Credit Union (BCFCU) finalized its acquisition of the Madison branch office of Citizens State Bank.
The Consumer Financial Services Bureau (CFPB), a consumer advocacy agency founded after the financial crisis, has identified a number of rural counties across the US that are deemed to be underserved from a financial services perspective. The six Florida counties that comprise BCFCU’s field of membership are included in the CFPB’s list.
For many large banks, the economics of providing financial services to lower population groups are not compelling. Credit unions have different motivations. As financial cooperatives, credit unions exist to help people. Banks have shareholders to answer to. Credit Unions only answer to their members who are the owners of the credit union. A credit union’s goal is to serve all members well, including those of modest means – every member counts. BCFCU understands this and has been serving the needs of rural members since 1956, initially serving employees of the Buckeye Cellulose Corporation and their families, subsequently expanding to serve six rural counties. The credit union already had approximately 1,000 members who live in Madison County, but had no local office to serve those members. When the opportunity arose to acquire Citizens State Bank’s office in Madison, the credit union felt it would be the perfect time to provide a convenient, local office to serve their members, including small businesses and underserved individuals in the community. The process was arduous, involving two regulatory bodies: the FDIC (banks) and NCUA (credit unions) and took over two years to complete.
What would motivate a credit union to buy a branch office from a community bank? We have touched on it above. We felt with an office located in Madison, we would be able to better serve the membership base we already have within Madison County and be able to serve new members who are interested in joining our credit union. Credit Unions are owned by its members. We do not have shareholders to take the profits from the financial institution. Any profits are returned to the members in better rates and services.
The credit union movement began with a simple idea – that people could achieve a better standard of living for themselves and others by pooling their savings and making loans to neighbors and co-workers – leaving out those interested in taking from the profits for themselves, individually. BCFCU is excited to be part of the Madison community and to extend the benefits of credit union membership to the people who live, go to school, work or worship in Madison County.
BCFCU has a rich history of people serving people and we are glad to extend our friendly services to the people of Madison County. We want to be here to support Madison County and our office here to be known as Madison County’s credit union.