Talking Credit Unions with Chris Smith
These podcasts aim to communicate topics of interest from the world of credit unions targeted at managers, directors and other activists within the world of credit unions. I'm a long term supporter of credit unions and have served on the board of directors of several credit unions. This is a not for profit venture and my time is donated pro-bono. I am constantly on the look-out for stories and topics of interest to credit unions especially, but not exclusively, in the UK and Ireland. Contact me: smithowls@gmail.com A contribution to my costs has been made by Swoboda Research Centre and I rely on them for additional distribution and inspiration.
Talking Credit Unions with Chris Smith
Credit Union Mergers - A strategic opportunity? EDITION 17
An interview with Robert Kelly CEO at ABCUL (Assoc. of British Credit Unions Ltd).
I was really interested in the news that ABCUL are to launch a Strategic Merger Taskforce. Robert Kelly, CEO at ABCUL, once again appears to tackle subjects that appear sometimes to be difficult to deal with but nevertheless are really of the moment. Credit Union mergers, or transfer of engagements, in the past have typically been a way of saving a struggling credit union from failure, by being absorbed into a healthier partner. However, could two, or more, credit unions join; and become strategically stronger by merging from a position of strength of their combined healthy businesses?
This new task force should have its work cut out in helping understand what role mergers in boosting the sustainability drive for credit unions. A great deal has been said in recent times about the need for collaboration between credit unions and I know there are collaboration projects out there that are doing well, but I wonder if there is a co-operative way forward, it could be a jointly owned ‘CUSO’s (credit union service organisations) or in some cases a strategic merger? It has to be said that sometimes, following mergers of any business, scale economies lead to tough outcomes for some stakeholders and I hope the boards of our credit unions are ready for that?
Here's some of the questions I put to Robert:
- Tell us about the Strategic Merger Taskforce?
- What is a ‘strategic merger’ and why is ABCUL taking a role in facilitating this? Is there a lot of interest among ABCUL members?
- If credit unions are doing well, why would they take the risk of merging and fixing something that isn’t broken?
- What makes mergers successful, in your view? And what are the pitfalls?
- Is “merger” misleading? Aren’t the successful examples where it’s really an acquisition, i.e. where a successful leadership team effectively absorbing a new group of members into their existing arrangements?
- Perhaps some CEO's or board directors holding on to their positions, when this might be against their members’ interests?
Talking Credit Unions with Chris Smith is a regular podcast dedicated to informing credit union practitioners, leaders and opinion formers on variety of industry topics. To contact Chris Smith, smithowls@gmail.com