Banking

Small Kansas City credit union to merge into CommunityAmerica

Burns & McDonnell Credit Union in Kansas City, Mo., is seeking members’ approval for a proposed merger with CommunityAmerica Credit Union, headquartered in nearby Lenexa, Kan.

BMCU holds about $27 million of assets and was chartered in 1971 to serve employees of Burns & McDonnel, a Kansas City construction firm, as well as retirees and their families.

CommunityAmerica serves consumers across the Kansas City metro region and has branches on both sides of the Kansas-Missouri state line. At $3.5 billion of assets it is the largest credit union in either state, and the deal will add about 2,000 members to its roster and boost its assets slightly.

“The credit union industry has faced an unprecedented and sustained interest rate environment that has made income growth challenging. Merging with CACU transitions our members to a sound financial institution with both income and capital strength,” Hassan Sahudin, chairman of the BMCU board of directors, wrote in a notice to members.

The credit union earned just under $100,000 in 2020, down from more than $286,000 in 2019 as expenses rose, lending contracted and noninterest income declined.

If approved a merger into CommunityAmerica would provide Burns & McDonnell members with access to a wider array of products and services, and an expanded branch and ATM network. Two BMCU employees will also be retained and will be recognized with payments of $10,000 each once the deal closes.

BMCU members will also receive a $380,000 bonus dividend based on their average daily balance for all deposit products during 2020. The payout will be distributed at the time of the merger. On top of that, because CommunityAmerica only requires a minimum share balance of $1, compared to the $25 minimum share at BMCU, all members will be repaid the difference.

A virtual meeting to vote is scheduled for June 8.


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