The two biggest credit unions in the Tampa Bay area, Suncoast Schools Federal Credit Union and GTE Federal Credit Union, confirmed Tuesday that they have signed a letter of intent to merge.
The proposal, which is subject to up to six months of review and then regulatory approval, would create the fifth-largest credit union in the country.
Suncoast is Florida's biggest credit union with $6 billion in assets and 480,000 members, and GTE is third with about $1.9 billion in assets and 203,000 members. Suncoast has 1,000 employees with 50 branches clustered in the west coast of Florida while GTE has about 600 employees with 38 branches in Florida, two branches in Louisiana and one in Portland, Maine.
In an interview with the St. Petersburg Times on Tuesday afternoon, Suncoast Schools president Tom Dorety and GTE president and CEO Wendell "Bucky" Sebastian said some key decisions remain to be made in the coming months. Among them: what the combined organization will be named, who will lead it and where its headquarters will be.
One issue that's already decided, Sebastian said, is that there will be no layoffs.
And given the minimal overlap of branches, Dorety predicted few if any branches would close.
"Suncoast has a strong presence in the south; GTE has a better presence in the north, and they go further east than us," Dorety said.
"At this point in time," Sebastian added, "we simply see an expansion of the branch network."
The two credit unions, and their industry as whole, certainly haven't been immune to the financial turmoil rooted in real estate loans gone sour. Suncoast lost $76 million last year while GTE lost $27 million.
According to the latest available credit union industry ratings by Bauer Financial, Suncoast was a 2-star or "problematic" institution and GTE rated as 3-star, or "adequate."
Sebastian said the economic challenges "probably crystallized the decision (to merge). It wasn't the driving force, but it made it all the more obvious how beneficial it would be."
Among those benefits, they said: a wider network of branches and ATMs, a greater talent pool and career opportunities for employees, and enhanced call center services.
Neither credit union is paying a premium for the other; the two entities will pool their assets.
Though both organizations started modestly, they have grown aggressively through nearly 20 mergers apiece.
Dorety, 58, said he and Sebastian, 65, have long discussed the possibility of joining forces.
"Bucky and I have known each other a long time, and we're very close friends," he said. "We have very similar viewpoints of what a credit union means in serving its members."
Times staff writer Ernest Hooper contributed to this report. Jeff Harrington can be reached at email@example.com or (727) 893-8242.