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Suncoast, GTE Credit Unions Announce Merger Plans

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By MICHAEL SASSO | The Tampa Tribune

Published: March 3, 2009

Updated: 03/03/2009 04:38 pm

TAMPA - Suncoast Schools Federal Credit Union, Florida's biggest, and GTE Federal Credit Union plan to merge, the two Tampa-based companies announced Tuesday.

Suncoast Scools and GTE will conduct due diligence for up to six months, examining each other's financial statements, operations and loan quality. Then the merger plan would be turned over to regulators for review. It wasn't clear Tuesday how long that review would take.

Leaders of each company said the merger, if approved, won't result in job losses. Other merger details, including where the headquarters would be and who would lead the merged company, will need to be worked out by the board of directors, they said.

"We have absolutely no plans for any layoffs or branch closings as a result of this," said Tom Dorety, president of Suncoast Schools.

In an interview today, Dorety and GTE Federal Credit Union Chief Executive Officer Bucky Sebastian said the national credit crisis isn't behind the move to join forces. While the merger might help both credit unions' capital ratios, merging makes long-term sense in a good or bad economy, they said.

Customers of each credit union will have access to more branches and a bigger ATM network, and it will create greater efficiency for the companies. Plus, the companies' branches generally don't overlap, they said.

BauerFinancial, a bank and credit union rating agency, assigned Suncoast Schools a rating of two stars out of five in its last credit union analysis, which is a "problematic" rating.

BauerFinancial President Karen Dorway attributed its rating to Suncoast Schools' recent financial losses and a relatively high level of nonperforming assets, which include delinquent loans and repossessed properties.

Dorety said Suncoast Schools remains "adequately capitalized." BauerFinancial assigned GTE a three-star rating, which is "adequate."

According to a news release, Suncoast Schools is the seventh largest credit union in the country. It has 473,000 members, operates 50 branches and has assets of $6 billion. GTE Federal Credit Union has 205,000 members, operates 38 branches and has more than $1.8 billion in assets.

Reporter Michael Sasso can be reached at (813) 259-7865.

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