Today the FDIC approved the insurance of accounts of a newly chartered Utah bank which will merge with Thrivent Credit Union and operate as a subsidiary of Thrivent Financial Holdings Inc. The transaction has many moving parts and is still being analyzed. Below is a description of the transaction from Chairman Gruenberg’s Memorandum to the Board:
TFL proposes to establish Thrivent Bank as a Utah industrial bank and merge Thrivent Federal Credit Union, of Appleton, Wisconsin into the Bank. The credit union is a federally chartered credit union with $832 million in assets. TFL sponsored the credit union’s establishment in 2012.
TFL proposes to establish the Bank primarily to broaden its reach within the general population and attract new clients beyond the existing credit union’s restricted field of membership. The Bank will be able to attract customers nationwide without regard to customers’ religious affiliations.
The Parent Companies propose a business plan that leverages the existing products, customers, infrastructure, and personnel of the existing credit union following its merger into the new Bank. On it own, the credit union does not have the financial or capital support of a parent company to foster growth. The business plan proposes a diversified loan portfolio centered in retail loans, funded primarily by retail deposits. The proposed bank thus follows a traditional bank business model. The Bank’s products and services would be delivered exclusively online, with no branches or retail banking presence at its Salt Lake City location. In addition to the strength of the credit union, the Bank would also leverage certain resources available through TFL’s existing infrastructure.
This transaction raises a host of questions the answers to which are not yet clear. Some go to the heart of mutuality. We will keep you appraised as we learn more.
