Coronavirus scuttles major credit union-bank deal

The coronavirus has scuttled the largest-ever credit union acquisition of a bank.

Suncoast Credit Union, an $11 billion-asset institution based in Tampa, entered into a deal in December to purchase the $747 million-asset Apollo Bank in Miami. But a statement from the bank said “a series of indefinite delays that arose during the regulatory approval process due to the COVID-19 pandemic” led to the deal being called off.

“These unforeseen delays made proceeding with the merger untenable,” representatives of the bank said in a statement on Tuesday. “While disappointed by this development, both Suncoast and Apollo are keeping focused on providing trusted guidance and support to our clients and communities during this critical time.”

"The agreement, signed in December 2019, has been in the process of regulatory review and approval; however, the economic disruption caused by COVID-19, has forced us to re-examine our plan," Kevin Johnson, CEO of Suncoast, said in a statement. "Both parties have come to an amicable agreement with no harm or malice, believing that the current conditions no longer represent a viable option that would allow the acquisition to move forward."

The Suncoast-Apollo deal capped a record year for credit union-bank acquisitions. But the pace of deals was already slowing in the early months of 2020 even before the coronavirus pandemic spread. In January, state regulators in Colorado blocked Elevations Credit Union’s bid to purchase the assets of Cache Bank & Trust, claiming state laws do not explicitly permit different types of financial institutions to purchase others.

In early March, Iowa bank regulators attempted to block a credit union from buying a handful of branches from a bank in the state. But the bank involved ultimately came to an agreement with the regulator.