Merger would broaden PenFed’s attain to Wisconsin

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Pentagon Federal Credit score Union, one of many nation’s largest credit score unions, may broaden its attain via a proposed merger with Submit Workplace Credit score Union in Madison, Wis.

The deal is PenFed’s second merger announcement in just some months.

In a discover despatched to Submit Workplace members, the credit score union’s board cited evolving applied sciences, compliance burdens and rising cybersecurity threats as among the major drivers behind the merger, together with further services and products obtainable via PenFed. The McLean, Va.-based credit score union has property of over $26 billion, in comparison with POCU’s $34 million.

The proposal is a part of an ongoing pattern that has seen credit score unions chartered to serve postal workers merging into bigger establishments with extra diversified fields of membership.

PenFed is one in every of just some credit score unions within the nation with an open constitution that enables anybody to affix, a function it picked up via a controversial merger with Progressive Credit score Union, which was targeted closely on taxi-medallion lending, early final yr. Second-quarter knowledge from the Nationwide Credit score Union Administration exhibits PenFed as having almost 330 million potential members. Bethpage FCU also gained an open constitution a couple of years in the past after buying a credit score union with excessive concentrations of taxi medallion loans and has a possible membership of 330 million.

By comparability, NCUA lists Submit Workplace CU as having 187,000 potential members.

As a part of the deal, Submit Workplace Credit score Union is planning a one-time capital distribution of $200 to every eligible member in good standing — for a complete of $640,000 — if the merger is accepted and finalized, in accordance with paperwork posted by NCUA.

Submit Workplace Credit score Union’s solely workplace will turn out to be a PenFed department and all workers are being given positions with PenFed, with CEO Kevin Yaeger and VP Tammy Stuntebeck receiving raises. The pair even have severance-package preparations with PenFed totaling almost $615,000.

A member vote is anticipated to be accomplished by Dec. 27, although no completion date for the merger was specified.

A PenFed representatives didn’t reply to an e-mail searching for extra info on the deal.

Submit Workplace Credit score Union earned simply shy of $35,000 throughout the first three quarters of 2020, down from almost $103,000 throughout the identical interval final yr, pushed partially by a 7.6% decline in curiosity revenue.

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