Credit unions announce merger

American AgCredit, based in Santa Rosa, Calif., has merged with Greeley-based Farm Credit Services of the Mountain Plains.

The merger, according to the organizations, has been under way for roughly two years and resulted in the creation of the sixth-largest farm credit cooperative in the U.S., totaling $5.58 billion in assets and a combined customer base of 6,907 members.

American AgCredit CEO Ron Carli will preside over the newly formed entity, which will retain the American AgCredit name. Terry Anders, the CEO of Farm Credit Services of the Mountain Plains, retired on the day that the merger took effect, Jan. 1. He had been in the position 21 years.

The union of the two also is expected to yield cost reductions of up to $2 million a year. About $1 million in annual savings are expected as redundant positions are consolidated over a period of two to three years. There was no clear word, however, on how many positions might be pared.

“The combined organization will create efficiency benefiting stockholders, and will strengthen the association through more diversity and better capitalization,” the boards of both organizations said in a joint news release. “Through this, and through the extension of our national presence, American AgCredit is poised to lead agriculture lending into the next generation.”

The merger promises to provide the institution greater geographic, commodity and borrower diversification.

Mountain Plains’ loan portfolio is heavily concentrated in small-grain and field crops (22.2 percent), beef and other livestock (22.5 percent), with a large percentage (37.4 percent) comprised of a variety of small-market commodities.

American AgCredit’s portfolio is spread across a number of industries, commodities and specialty crops that Mountain Plains does not finance, such as wine grapes, vegetables, tree fruit and nuts, timber and dairy.

To read the full press release, go to: http://www.agloan.com/news_events.shtml#1_4_2012.

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