The Bank Slate


Minnesota is latest state to block credit union-bank deal

Another state has intervened to impede a credit union’s pending purchase of a bank. 

The Minnesota Department of Commerce has rejected the sale of Lake Area Bank in Lindstrom, Minn., to Royal Credit Union in Eau Claire, Wis. 

The agency determined that, in Minnesota, “a state-chartered bank is not authorized to transfer its assets and liabilities to a credit union for the purpose of consolidating or merging out of existence,” according to the Minnesota Bankers Association. 

Royal agreed to buy the $424 million-asset Lake Area in August. 

At least six states – either by law or agency intervention – have stood in way of credit union-bank mergers.

The decision comes a month after lawmakers in Mississippi approved a law that would severely limit credit unions’ abilities to buy banks in that state. 

Credit unions looking to buy banks have also met roadblocks in Colorado, South Carolina, Tennessee and Nebraska.

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