BERRIEN SPRINGS, Mich.—The $735-million Honor Credit Union has entered into an agreement to purchase $53-million Citizens State Bank of Ontonagon.
The agreement includes purchasing all the assets and liabilities of the Ontonagon, Mich.-based Citizens State Bank, which has three locations.
The deal is pending bank shareholder approval, as well as approvals from both state and federal regulators.
Citizens State Bank has been marginally profitable in the last two years, posting $186,000 in net income in 2015 and $204,000 in 2016, according to FDIC data.
“The history of service that Citizens State Bank of Ontonagon has is incredible and is a legacy that Honor Credit Union is honored to contribute to,” said Scott McFarland, Honor Credit Union CEO. “With aligning cultures and community commitments, we are looking forward to getting to know our new Ontonagon friends and neighbors.”
“The Citizens State Bank of Ontonagon has been a part of the Ontonagon community for 107 years and we take great pride in the responsibility of providing for our customers and bettering our community," said Willie DuPont, Citizens State Bank of Ontonagon president. “We are extremely excited to welcome Honor Credit Union to our community, which will allow us to provide benefits not previously possible, including numerous loan options, lower loan rates and higher deposit rates just to name a few.”
“This is a win for Honor, its member owners, Citizen’s customers and future Honor member-owners and the Ontonagon community. Transactions like this help maintain and assure that local community based financial services are available,” said Michael Bell, attorney and counselor with Royal-Oak, Mich.-based Howard & Howard, who is representing Honor CU. Bell has been part of 14 CU/bank deals, including one merger of a bank into a credit union.
If the Citizens State deal is finalized, it will be the 16th time a credit union has acquired a bank since 2011, when Michigan's $1.6-billion United FCU pioneered such purchases by acquiring $81-million Griffith Savings Bank in Indiana.