Vacaville's Travis Credit Union buys Concord's Metro 1
By George Avalos / Contra Costa Times
posted: 12/10/2010 05:09:23 AM PST
Travis Credit Union, a $1.6 billion financial firm, has struck a deal to broaden its footprint in the East Bay by acquiring Concord-based Metro 1 Credit Union, the companies said Thursday.
Vacaville-based Travis said the deal is part of its strategic quest to expand its reach in Northern California and the Central Valley.
"We're excited about this," said Patsy Van Ouwerkerk, president of Travis Credit Union. "This is a great strategic partnership. We're very pleased about it."
Metro 1, founded in 1949, has 49 employees and is a far smaller company than the 450-employee Travis. That credit union was founded in 1951 primarily to serve military and civilian employees associated with Travis Air Force Base in Fairfield.
"This is going to really benefit our members, which is the bottom line,"
said Tina Fields, president of Metro 1. "Our members will have access to many more branches."
Travis has 19 branches, including outlets in Vacaville, Fairfield, Dixon and six other cities.
Metro 1's five branches are in Antioch, Benicia, Concord, Richmond and Oakley.
"Our members will be able to get better rates on their deposits, better rates on loans, and Travis has been able to cut a lot of fees," Fields said.
At the end of September, Travis had $1.42 billion in deposits and $1.6 billion in total assets, according to a regulatory filing. In that same time period, Metro 1, formally known as First Metropolitan Credit Union, had
$169.4 million in deposits and $177.4 million in assets.
Travis Credit Union was identified as the ideal merger partner because it shares our focus on quality member service, offers multiple regional locations to serve our members, and has a long and proven history of financial stability," Fields said.
In addition, Travis is obtaining a Metro 1 firm that has been losing money for some time.
For all of 2009, Metro 1 lost $4.6 million, the credit union's regulatory filings show.
"Metro 1 in its marketplace had heavier amounts of real estate problems and they sustained heavier losses than other credit unions," said Diana Dykstra, chief executive officer of the California Credit Union League. "They were really stuck in a bad area and got hit harder than most others."
Earlier this year, Fields confirmed that Metro 1 was looking for a merger partner.
"This was very proactive on the part of Metro 1," Dykstra said. "They knew their capital levels were slipping, and they were having difficulty turning things around. They sought out a merger partner rather than have the regulators come in and shut them down."
Nationwide, the number of credit unions has shriveled steadily over the decades and in recent years.
In the 1970s, the nation had 22,000 credit unions, Dykstra said. In 2005, the number had dropped to 9,200. Today, the number is closer to 7,500.
The deal is expected to close by April. The two credit unions will combine their financial statements effective at the end of December.
It's possible that the deal could lead to job cuts. For example, Metro 1 and Travis have branches across the street in Concord on Willow Pass Road. And Metro 1 had laid off 11 employees earlier this year, Fields said.
"Travis has some openings as well. We are encouraging them to apply with Travis." Van Ouwerkerk said. "Our goal is to keep as many of the Metro 1 employees as we can. But we also really need to make sure we are operating efficiently after the merger."
The expansion efforts by Travis could produce more acquisitions.
"Certainly in the future, we are interested in expanding in the Central Valley, in Alameda County and in Solano County," Van Ouwerkerk said.
"Mergers are part of our growth strategy."
