DES MOINES (12/29/14)--A voluntary merger of the Des Moines and Seattle Federal Home Loan Banks (FHLBs) has been approved by the Federal Housing Finance Agency (FHFA). The merger was first announced in September, and the two institutions submitted their merger application Oct. 31.
The FHFA's approval triggers the next step in the process, which is ratification of the merger agreement by the members of the Des Moines and Seattle cooperatives. Members of both institutions must separately ratify the merger agreement by majority vote in the manner prescribed by the FHFA merger rules.
The voting process for both institutions is anticipated to begin in mid-January and conclude in late February. Members of each FHLBank, as of Sept. 30, will be eligible to vote.
All eligible voting members will receive disclosure materials with detailed information about the potential merger in early January. Additionally, both the Des Moines and Seattle FHLBanks will hold member meetings in their respective districts during the voting period to respond to member questions.
The boards of directors of both institutions have unanimously approved the proposed merger. The combined FHLBank would be headquartered in Des Moines and maintain a regional office in Seattle. Current FHLB Des Moines President/CEO Dick Swanson will serve as CEO of the merged institutions, and current FHLB Seattle President/CEO Mike Wilson would serve as president.
According to a joint release from the two institutions, the members of the combined cooperative would "have access to an enhanced suite of products and services and benefit from increased economies of scale and greater risk diversification. The combined institution would remain a member-owned and member-centric cooperative, deeply focused on helping its members better serve their customers and communities."
FHLB program membership includes more than 7,300 financial institutions, including credit unions, commercial banks, thrifts, insurance companies and community development financial institutions from every U.S. state and territory.