Mergers and acquisitions frequently scare away nonprofit folks. Loss of mission, identity and control by one of the parties are generally cited as reasons. Financial bottom line, a reasonable motivator, is not usually the first best reason to get mergers or acquisitions of nonprofits going.
Today we see an acquisition of two nonprofits where the rationale is mission-driven and bottom-line driven and has the potential of being a win-win for the institutions and the customers.
Navy Federal Credit Union is taking over USA Federal. Navy Federal Credit Union is currently the largest Credit Union in the country. It primarily serves those who are or were in the Armed Forces as well as their families (how I got to be a member). USA Federal is a credit union in trouble financially, having suffered significantly from a failed economy, particularly in California.
The Washington Post describes what took place: "The deal between the two nonprofit organizations involved no shareholders, no stocks and no exchange of money. Both boards approved the merger, with federal regulators having the final say. Navy Federal assumes the assets and debts of USA Federal."
Let's hope that Navy Federal can address the failed market issues successfully and provide a positive example of nonprofit takeovers.