Nutmeg State Financial Credit Union in Rocky Hill and First Bristol Federal Credit Union in Hartford said this week that First Bristol members approved the merger of the two institutions.

It was the final hurdle for the transaction, which was announced in January and is anticipated to take effect in early 2025.

The combined organization will be a $675 million-asset, state-chartered credit union serving nearly 48,000 members. Nutmeg State’s President and CEO John Holt will serve as CEO of the combined credit union, and First Bristol CEO Mark Cornacchio will remain in a yet-unannounced leadership role.

Holt told Tyfone he is seeing increased merger interest from smaller credit unions that are looking for a life raft due to factors including regulatory burden, compliance costs and competition.

“It also has a lot to do with the fact that smaller credit unions cannot find the right talent to replace the current talent, and that includes the executive team and the board,” Holt said in an interview. “[There are] lots of retirements without succession plans or the ability to find the right talent.”

On top of that, compressed margins, struggles to keep up with technology and the ability to grow and scale continue to challenge small institutions.

In fact, Holt said Nutmeg state is currently working on two other potential mergers.

Nutmeg State Financial earned $76,000 in the first quarter of 2024, a 79% decrease compared with a year earlier, according to call report data from the National Credit Union Administration.

First Bristol earned roughly $68,000 in the quarter after a loss of $30,000 in the first quarter a year ago.

“We know it would take years to grow to the point where we could offer members all the branches, products, services, and technologies this merger will bring.”

 – Mark Cornacchio
CEO
First Bristol