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Chartway FCU sets up midwest merger.

The $1.3 billion Chartway Federal Credit Union, Virginia Beach, Va., is up front about its merger intentions and considers itself in an elite class of national suitors.

The credit union said last week that it expects to finalize an NCUA deal by year-end to merge with a $400 million Midwest credit union. Neither Chartway nor the NCUA is yet ready to identify the merger target because the agency has yet to give its final approval.

The transaction, pursued by Chartway for months and representing a key part of the CU's field of membership strategy, centers on a prospective partner "that is a good membership fit for us" by extending Chartway's reach into a new growth market, said Ronald Burniske, president/CEO.

Stressing that he was "not at liberty to identify the credit union," Burniske said a preliminary management agreement was signed before Thanksgiving allowing the Chartway staff to begin running the credit union, which includes five branches and a community charter.

Chartway operates in a locale where the real estate market has fared better than most, said Burniske, and where unemployment is half the national average. Thus, the acquisition poses "pretty limited exposure," he added.

Chartway, the former Naval Air FCU, is bent on expanding its FOM beyond the nine states where it operates.

Chartway is in very healthy condition and has been aggressive in sending out e-mails, making phone calls and general networking to solicit merger prospects provided they fit the credit union's goals, said Burniske. He said his staff, over the last year, has made about 150 calls asking CEOs and boards about possible consolidations.

The calls, he stressed, are not done at random but with careful attention to a strategic member fit, acknowledging also that Chartway is among the billion-dollar-plus credit unions that have the financial wherewithal to scout national markets for merger prospects.

In an interview with the publication Inside Business, Burniske said there was a second merger deal in the works involving a federal CU "somewhere in the Southwest."
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Author:Rubenstein, Jim
Publication:Credit Union Times
Date:Dec 16, 2009
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