Schools Financial Credit Union of Sacramento is set to merge with the state’s largest credit union, the two institutions announced Tuesday.
The merger with Santa Ana-based SchoolsFirst Federal Credit Union will be completed before the end of 2019, pending approval by the Sacramento-based credit union’s membership and regulatory authorities, according to a joint press release.
Primarily serving school employees and their families, the combined membership of the institutions would top 1 million.
“We’re always focused on what’s best for our members,” said Tim Marriott, chief executive of Schools Financial Credit Union, “and (by) combining the two credit unions we can provide some tremendous benefits for members ... in terms of lower cost loans.”
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He added that the merger will allow members of the combined credit union to use branches in different parts of the state.
The 86-year old Sacramento-based Schools Financial Credit Union has $1.9 billion in assets and 11 branches in the Sacramento area, according to a press release.
SchoolsFirst FCU, formed in 1934, has more than $15.2 billion in assets and 50 branches throughout Southern California, the press release stated. It is the largest credit union targeting the educational community in the country and the nation’s fifth-largest credit union overall.
Marriott said he first approached SchoolsFirst in May 2018 with a proposal to merge the two businesses.
“Both credit unions are large and successful and have very strong membership services. We just think we can be stronger together,” said Bill Cheney, president and CEO of SchoolsFirst.
After the merger, the Schools Financial Credit Union name will be dropped and the two financial institutions will operate under the SchoolsFirst FCU name and charter.
The names are only “different by a few letters,” Marriott said. “In terms of local presence, I don’t think a large change will be noticed other than the logo color will go from red to blue.”
The two credit unions plan to retain all current employees and maintain all existing branches, Cheney said.
As of Sept. 30, 2018, there were 5,436 federally insured credit unions with 115.4 million members, according to the National Credit Union Administration.