Two Maine-based credit unions have called off their proposed merger.
Maine State Credit Union in Augusta and Midcoast Federal Credit Union in Freeport have agreed to discontinue their plans to merge, the companies said in a joint release March 15.
The two institutions
Earnings were down considerably for both credit unions in 2020.
Maine State earned $1.7 million in 2020, compared with $2.8 million the year before, according to call report data from the National Credit Union Administration. That was driven in part by rising expenses, a decline in noninterest income and an increase in charge-offs.
The $218 million-asset Midcoast FCU lost nearly $338,000 in 2020 after earning $1.5 million the previous year. The credit union saw a nearly 25% increase in noninterest expenses last year, due in part to a 43% ($1.7 million) increase in staffing costs. Charge-offs and allowances for loan losses were both also up slightly.
The deal had received preliminary regulatory approval, but both organizations agreed that proceeding was not in the best interests of their members and employees, according to the release.
“The challenge of bringing together two successful organizations is just that both credit unions have been thriving individually and cultural alignment is difficult to achieve,” said H. Tucker Cole, president and CEO of the $531 million-asset Maine State.
“All merger discussions ended amicably. We will continue to work collaboratively to promote the value of credit unions for Maine consumers," said Midcoast FCU president and CEO Joe Gervais.
