AnchorBank to sell 11 branches to Royal Credit Union
Madison-based Anchor BanCorp Wisconsin Inc., which has suffered significant losses during the recession and financial industry crisis, will sell 11 AnchorBank branches in northwestern Wisconsin to Eau Claire-based Royal Credit Union.
The transaction is subject to regulatory approval and customary closing conditions and is expected to be completed in the first quarter of 2010. Financial terms of the transaction were not disclosed.
Royal Credit Union will assume approximately $177 million in deposits and receive a corresponding amount in loans, real estate, and other assets.
AnchorBank CEO Chris Bauer said that the sale will shrink Anchor’s assets while enhancing its capital and ability to address asset quality and other obligations. The sale will move AnchorBank closer to compliance with an Office of Thrift Supervision supervisory agreement that calls for higher capital ratios.
"This transaction with RCU allows AnchorBank to make significant progress toward our goal of increasing our capital ratios in order to continue to address the challenges we’re facing in this economic climate," said Bauer. "Royal Credit Union has an outstanding legacy of service in the communities of central and western Wisconsin, and we are confident that these branch customers will be in excellent hands with this distinguished hometown institution."
The branches involved in the transaction are located in Amery, Balsam Lake, Centuria, Menomonie, Milltown, New Richmond, Osceola, River Falls, St. Croix Falls, Somerset and Star Prairie. All of the offices being sold were acquired by AnchorBank in its 2008 acquisition of S&C Banco.
"Beyond the key outcomes of shrinking assets and improving capital ratios, this sale will also allow AnchorBank to further reduce core operating expenses and to identify potential areas for additional cost savings in a streamlined branch network," said Bauer. Once the acquisition is complete, RCU will have 26 offices, 23 across central and western Wisconsin and three in the Twin Cities Metro area, serving more than 140,000 Members.
"We are excited by the opportunity to acquire these AnchorBank offices, which fit perfectly into our five year expansion plan," said RCU CEO Charlie Grossklaus. "We want to be strategic with where we expand. These are successful offices for AnchorBank and a great opportunity for RCU and our members."