Bedford-based Hoosier Hills Credit Union members have rejected a proposed merger with Columbus-based Centra Credit Union, according to a press release issued by Centra today.
Following is the press release:
Preliminary Member vote results released from third-party administrator Koch Law Firm P.C. revealed Bedford, IN-based Hoosier Hills Credit Union did not receive the majority of Member votes needed to move forward with their proposed merger with Columbus, IN-based Centra Credit Union.
Hoosier Hills and Centra Credit Union announced their intent to merge in January 2024. Regulators approved the merger in March. The two financially sound credit unions planned to join forces and offer Members 38 Service Centers and more than 70 ATMs/ITMs across their combined footprint. If approved, Centra planned to merge into the Hoosier Hills charter, and the continuing credit union would have taken the Centra Credit Union name. Centra President and CEO Rick Silvers was slated to lead the unified Credit Union with Hoosier Hills’ full executive team continuing to serve in executive leadership roles.
The credit unions cited numerous reasons for the merger, including a wide array of Member benefits, significant strategic alignment, increased community support and career opportunities, and the retention of all Service Centers and Team Members in the combined organization. No financial incentives for executives were cited in the NCUA’s required disclosures for Members. The Board of Directors for both Credit Unions unanimously supported the merger, launching the partnership agreement with staunch support and solidarity.
Shortly after the merger was announced, Members of Hoosier Hills raised questions and concerns, primarily through social media. Despite extensive communications from Hoosier Hills outlining the factual details of the merger, the vote was impacted by the circulation of misinformation. While many Members and Team Members supported the partnership, ultimately a majority vote could not be achieved.
“Our Members are dedicated ambassadors for Hoosier Hills Credit Union, and we appreciate their energy and passion. We will continue to find new and innovative ways to grow and deliver enhanced products and services now and into the future, as we focus on serving our Membership and the underserved. We also appreciate our friends at Centra Credit Union, who willingly gave of their time, effort, and collaborative energy throughout this entire process,” said Travis Markley, President and CEO of Hoosier Hills Credit Union.
Centra Credit Union Members were largely supportive of the merger, with neutral or positive feedback surrounding the merger on Centra’s Facebook page.
“I’m grateful for the trust our Members placed in us regarding this partnership. I’m also grateful for the passion that Hoosier Hills Members displayed during this process. It’s that passion from Members that will keep credit unions thriving. We’re cooperatives, which means we all succeed together,” said Rick Silvers, President & CEO of Centra Credit Union.
Credit unions are unique in that they operate democratically. In Indiana, Members of both credit unions are required to vote in major transactions such as mergers.
Advisors:
In connection with the transaction, Edelman & Co., Ltd. served as financial advisor and Krieg DeVault LLP served as legal counsel to Centra Credit Union. Piper Sandler & Co. served as financial advisor and Luse Gorman, PC served as legal counsel to Hoosier Hills Credit Union.
About Centra Credit Union and Hoosier Hills Credit Union:
As community-based, not-for-profit, full-service financial cooperatives with origins dating back to 1940 and 1969 respectively, the 28 service center locations for Columbus, IN-based Centra Credit Union and 10 service center locations for Bedford, IN-based Hoosier Hills Credit Union strive to create value for members and team members while making a positive difference in the communities they serve, delivering on the credit union principle of “People Helping People”.
