McHenry Savings Bank is on track to sell to Michigan State University Federal Credit Union as part of a deal in which the credit union will purchase the bank’s $350 million in assets and its three locations.
“This transaction is the culmination of a five-year turn-around process, and we are pleased we found a partner that shares our core values and will be an asset … to our clients and communities,” McHenry Savings Bank President Don Wilson said.
The deal was announced Monday. The transaction, which needs a sign-off from regulators, was unanimously approved by the boards of directors at both institutions, according to a news release.
The sale price is expected to be between $36.3 million to $38.2 million, based on the number of shares. McHenry Bancorp, the parent company, is expected to give shareholders between $39 and $41 in cash for each share they own, according to the release.
“The basic model of how we operate will remain the same,” Wilson said.
Told of the sale, McHenry Area Chamber of Commerce President Molly Ostep said, “We have enjoyed working with them over the years and looking forward to see how the new group supports the community.”
With the new owner, “we will now have 23 times the amount of resources” for customers, Wilson said, noting McHenry Savings had $350 million in assets compared to nearly $8 billion for MSUFCU.
MSUFCU, headquartered in East Lansing, Michigan, has 23 branches with an additional five under construction, more than 350,000 members, $7.61 billion in assets, and more than 1,200 employees.
“The basic model of how we operate will remain the same.”— McHenry Savings Bank President Don Wilson
“They are really trying to grow their Chicago market” and are opening five Chicago offices, Wilson said.
Buying McHenry Savings Bank is a way to “prime the pump as they expand into this marketplace,” he said.
As the credit union does not have a large footprint in Illinois, they are not expected to “make money by cutting jobs,” Wilson said. “They will retain all of our people.”
The sale to a credit union, expected to be finalized in early 2024, will cause “only good” changes for customers, he said.
“As a nonprofit organization, they don’t pay taxes. They can recirculate (those dollars) into other services, contributions to the community and to the services they provide,” Wilson said.