Merger Mania: What Thirty Quarters of NCUA Data Reveal About Credit Union Consolidation

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In this solo episode of With Flying Colors, host Mark Treichel presents a comprehensive data analysis of credit union mergers using thirty quarters of NCUA quarterly merger reports, covering activity from the third quarter of 2018 through 2025. The dataset includes 1,901 credit unions involved in merger activity, 1,298 completed mergers, and over $111 billion in merged assets.

Mark walks through the consolidation math: credit union mergers typically run between 130 and 180 per year, representing three to four percent of all charters annually. The most notable trend in the data is the dramatic increase in the average size of merging credit unions—from $36 million in average assets in 2018 to $285 million in 2025, roughly an eight-fold increase. Total merged assets in 2025 reached $45 billion, the highest annual figure in the dataset.

The episode examines the 80/20 split between voluntary and involuntary mergers, clarifying what the "involuntary" designation actually means in NCUA's reporting—and why it is frequently misunderstood. Mark also profiles the characteristics of serial acquirers, including one credit union that completed 24 mergers in four years, and discusses the different strategic approaches active acquirers take.

The pre-merger financial profile section compares median data from merging credit unions against the broader population, with return on assets, membership growth, loan-to-share ratios, net worth, and delinquency all examined. Mark identifies the two metrics he considers most predictive: earnings and membership growth.

The episode closes with a look at charter conversion trends—specifically the significant swing back toward federal charters since 2021—and a projection of where the industry is headed over the next 25 years under different consolidation rate scenarios.

Topics covered include:

•        Annual merger volumes and the peak year of 2019 (254 mergers)

•        The dramatic rise in average merger size: $36M (2018) to $285M (2025)

•        What "voluntary" and "involuntary" really mean in NCUA merger data

•        The 265 involuntary mergers: financial condition, official challenges, management, and sponsor loss

•        Serial acquirers and scale players: different strategies, same data source

•        Pre-merger profile: median $11M in assets, negative ROA, membership declining at -91bps

•        Acquirer profile: median $2.5B in assets, 82bps ROA, 139,000 members

•        Charter conversion trends: $41B moved back to the federal charter since 2021

•        Industry projections: 1,555 to 2,015 charters by 2050 under current consolidation rates

•        Strategic implications: board governance, membership growth, earnings discipline