Merger Talk: How Credit Unions Can Communicate & Safeguard Their Reputations

18 Oct Merger Talk: How Credit Unions Can Communicate & Safeguard Their Reputations


“To merge, or not to merge.” That is the question that credit unions (and financial institutions at large) are discreetly asking. These undiscussed, perhaps even taboo conversations, being done in the back room or over glasses of wine, seem to be happening at a steady rate. So do the results: In the first half of 2016 alone, the NCUA approved 100 mergers.

While credit union merger counts have slowed since the 277 consolidations completed in 2012 – totaling 254 in 2013, 257 in 2014 and 235 in 2015 – 2016 brought an uptick in numbers. During the first quarter of the year, the NCUA approved 54 mergers, a significantly higher number than the 41 mergers approved in Q1 2015, according to a recent CU Times article.

In our public relations firm’s experience supporting merging credit unions, the overarching theme we’ve encountered is that clear, concise and consistent communications are at the epicenter of a successful merger. Moreover, the cohesiveness of a strategic plan – and its actualization – must include safeguarding reputation as a paramount consideration.

Identifying the Big Picture

When analyzing and auditing a respective credit union to determine if proceeding with a merger makes sense, considerations include the strength of both credit unions’ balance sheets, cultural similarities, and compatible technology and communication channels (e.g., having the same core provider).

A merger “has to make sense financially for both credit unions, but we also place a lot of emphasis on shared vision,” Paris Chevalier, chief marketing officer for Xceed Financial Credit Union, explained.

The credit union, based in El Segundo, Calif., completed two mergers this year (with Reach Credit Union in Menlo Park, Calif., in March and Postmark Credit Union in Harrisburg, Pa., in August).

“In addition to a thorough review of their financials and an in-depth review of products, services, locations and associates, we carefully examine a credit union’s mission, vision and values,” she said.

If financial institutions decide to come together, communication must be considered in the context of logistics and cultural sensitivities, member nuances and understandings. Then the importance of timing and channels of communication can make all the difference in keeping institutional reputations intact.

For example, “No matter how great your communications are, they won’t help make the transition easier for members if they are not being read,” Chevalier explained. “At the outset of a merger, the communications team should find out how members are used to receiving information from their credit union, and then use that method – both for continuity and to increase the chances that your important updates will be read and understood.”

Timing Considerations

Communication is important before, during and after a merger. As communication and reputation management professionals, we are often brought into the realm late. We should be brought in early, however, to help maximize opportunity and mitigate risk.

To ensure a potential merger happens seamlessly, multiple departments should be involved beforehand – not only the top-level executives. Be sure to include members of your communication, marketing, HR and legal teams. It is also important to ensure that the board, executives, branch managers, member-facing staff and spokespeople are unified in their communications. This can be accomplished with training.

During a merger, a multi-prong approach should be taken for communication in the following sequence:

  • Internally to the acquiring the credit union: The board, executives, branch managers and staff.
  • Internally to the credit union being acquired: The board, executives, branch managers and staff.
  • Externally to respective members.
  • Externally to the credit union industry, communities being served, media and social media outlets. “Close cooperation with vendors is also key to minimize downtime and sync all of the changes,” Chevalier advised.

Assuming the reason for merging is to bind together, prosper and grow, the six months after a merger should be considered a working juncture of continued proactive communications. A credit union should use this opportunity to retain staff and members, as well as to attract new staff and members. Direct communications can also help strengthen the bond with the communities that the combined credit union serves, through staff volunteer time, addressing important issues and being stewards.

Creating a Mutually Beneficial Relationship

To grow and prosper while expanding services for members, credit unions can market themselves – an expensive undertaking – or they can acquire or be acquired. Historically, credit unions expand through a merger because it is a cost-effective way to increase market penetration within the existing market, acquire new branch locations and add vital fields of membership to the charter.

“With our two most recent mergers, we joined forces with credit unions that have helped to expand and enhance our footprint,” Chevalier said. “The new members who have joined us via these mergers are enjoying a significantly-expanded roster of products and services, as well as greatly-expanded access to their accounts.”

Although M&A deals can be challenging to navigate, the common goal between parties is often growth and improved performance. Keep in mind, however, that mergers and acquisitions are rarely a partnership of equals. One credit union is typically acquiring another, not necessarily blending, which means one name and culture generally rises to the top. Still, a merger should still be mutually beneficial.

Continuous listening as an active part of your communications plan – and acting on feedback that focuses on your members and employees – can help your merged credit union avoid surprises and increase the chances for success. This can also help safeguard your reputation for the long-term.

Refining Your Communications Strategy

How can you define your overall communications strategy and manage your reputation before, during and after a merger? Ask yourself these key questions:

  • What do you want to communicate?
  • Why do you want to communicate it?
  • Why is this partnership or consolidation happening now?
  • Who are the prospective members you want to communicate to?
  • How/where will you communicate your message?
  • One-on-one meetings, phone calls, emails, newsletters, media and social media.
  • When will you communicate your message?


A version of this article originally appeared in Credit Union Times on October 16, 2016. To view the original article, please visit Credit Union Time’s website here.

Matt Bresnahan
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