The normally staid world of Minnesota credit unions announced a second merger in less than a week Monday as Bloomington-based Star Choice and SharePoint credit unions announced they will combine to have nearly $400 million in assets and a service area spanning eight counties.
The deal is expected to close the first week of January 2024. It will create the 8th-largest credit union in the Twin Cities and the 13th-largest in the state with 27,800 members and six branches.
If all goes as planned, the joint entity will eventually adopt a new name, but for now will be called SharePoint Credit Union, meaning the Star Choice name is going away.
Signage will not change until the new name is adopted, officials said. Members will vote on the merger in October.
The merger comes on the heels of last week's announcement that Roseville-based Spire and St. Paul-based Hiway credit unions will merge to create the fourth-largest credit union in the state with $4 billion in assets.
Founded in 1933, SharePoint Credit Union originally catered to employees of the Red Owl grocery store. It now boasts $298 million in assets, 21,500 members and a service area of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, Washington and Wright counties.
Star Choice was established in 1931 as the Minneapolis Star Employees Credit Union and originally only served newspaper employees. It expanded its charter more than a decade ago and now has $93 million in assets, one branch and 6,300 members across Hennepin and Scott Counties.
After the merger, Star Choice members will gain access to Share Point branches in Burnsville, Medina, Plymouth and St. Louis Park and one inside the King's County Market grocery store in Andover.
SharePoint's branch in Bloomington will close and become an administrative office. Its banking services and staff will be relocated to Star Choice's Bloomington branch on France Avenue, Star Choice CEO Scott Olson said in an interview Monday.
Olson emphasized there will be no layoffs. He described the proposed merger as a "unique" opportunity.
"The Star Choice board of directors believe this merger will be highly beneficial, as both organizations share similar cultures and values," Olson said. "Our objective is to strengthen the overall value of the membership by offering improved personal service, a broader array of products and services, and greater convenience to our highly regarded members."
He added that with tougher banking regulations coming down the pipeline in the wake of three bank failures earlier this year, it made sense to consider taking on a partner and becoming a bit larger.
Olson said he has been approached about a merger at least 10 times, but that the timing made sense now.
Merging with SharePoint will give his members better savings rates, and increase the limit on insured deposits from $250,000 per member to $500,000, he said.
That insurance change stems from SharePoint having private deposit insurance, in addition to the $250,000 per member limit provided by the federal government.
