In a tight vote, Vermont State Employees Credit Union members have approved a merger with New England Federal Credit Union, VSECU announced on its website Wednesday afternoon.
Members voted 7,622 to 7,304 to approve the merger. It will result in the formation of Vermont’s largest credit union, with 165,000 members, 460 employees, 17 local branches, and $3 billion in assets, according to the announcement.
“Our membership is highly engaged in the democratic process as member-owners, evidenced by the highest credit union voter turnout ever in our history,” Rob Miller, president of VSECU, said in a statement. “As we look toward the future, we are excited about the opportunity this partnership promises and ready to take VSECU into our united future for all of our members.”
The voting took place online and by mail; it began Sept. 20 and concluded at a shareholder meeting at the Barre Opera House Tuesday night.
One of the leading opponents of the merger, VSECU’s former board chair Jerry Diamond, expressed surprise at how close the vote was and lamented that opponents did not have more financial resources to get their message out to members.
“It’s terribly disappointing,” said Diamond, a former Vermont attorney general.
Diamond said the vision of VSECU was to support areas outside of Chittenden County that have not benefited from explosive growth.
“The vision of VSECU was to support primarily those areas of the state that were desperate to develop their economic engines but maintained their senses of community,” Diamond said. “That vision is gone.”
The two credit unions will merge effective Jan. 1, but will continue to operate separately for several months after that, VSECU announced on its website and in a press release. Until then, members are asked to continue to use the branches they have been using. Until further notice, members will continue to use their existing accounts and checks. A new name for the organization is expected to be announced in 2023.
John Dwyer, president of New England Federal Credit Union, will become the chief executive officer of the merged credit union and the boss of VSECU’s Miller, who will become the new organization’s president.
“Our ability to bring two like-minded Vermont credit unions together will create tremendous opportunities, not only for our members, but employees and communities we serve,” Dwyer said in a statement.
Arthur Wolf, board chair of New England Federal Credit Union, will become the board chair of the merged credit union.
The VSECU board of directors had encouraged members to support the merger.
In a letter to members, the board argued that, together, the two credit unions could better face the challenges of an aging Vermont population in a rural state, accelerating technological change, “environmental, economic and social change; and increased competition from out-of-state financial institutions.”
The board promised more branches and ATMs, better information technology, and lower fees. It also promised to keep all VSECU employees, and at their current salaries.
As evidenced by the close vote, there was strong opposition.
In a commentary on VTDigger last month, VSECU’s former chief executive officer Steven Post and former board chairs Wally Farnum, Bob Shattuck, Diamond and Kimberly Cheney argued that VSECU would lose its independence and would turn over nearly $100 million in equity raised by its members to people who had no role in creating it.
The former VSECU officers said membership would no longer be restricted to Vermonters.
“If the proposed VSECU merger is approved, our statewide cooperative built by Vermonters, for Vermonters will be gone — forever,” they said.
Read the story on VTDigger here: By a narrow margin, Vermont State Employees Credit Union members approve a merger.