Members Approve CU Sale to Bank

COLUMBUS, Ohio - 11/2/2006 – Nationwide FCU announced yesterday its members had overwhelmingly voted to approve the acquisition of the $523 million by start-up mutual savings bank, Nationwide Bank, the first deal of its kind.

The credit union said 16,718 of 42,152 eligible members, or 40%, voted and 14,872, or 89% voted to approve the unprecedented deal. The deal calls for Nationwide Bank, a savings bank chartered in April by Nationwide Insurance, to acquire the 55-year-old credit union for $79 million, which will be paid out to members on a pro rata basis, depending on the amount of savings they had in the credit union at March 31. That means the average member will get about $2,000.

The deal is similar to the spate of recent conversions from credit unions to banks, calling for the credit union to first convert to a mutual savings bank, then merge with the shell of a bank. The only difference is members of the credit union are getting paid for their interests in the credit union. The transaction is expected to close in early 2007. The credit union, which serves more than 44,000 members, is the fourth largest in Ohio. (CU Journal)