U.S. Eagle Credit Union became the 14th credit union to acquire a bank this year when it finalized an agreement to acquire Southwest Capital Bank (SWCB). The deal raised eyebrows among community banking advocates who have been expressing alarm about industry consolidation in light of these types of transactions.
The combined institution will have nearly $2 billion in total assets with U.S. Eagle’s $1.5 billion and SWCB’s $474 million. The transaction is expected to close in the second quarter of 2025, pending necessary regulatory approvals and shareholder agreements. Both financial institutions are based in Albuquerque, N.M.
“We look forward to tapping into Southwest Capital’s knowledge of the Las Vegas market, as well as leveraging their expertise in business and cannabis banking deposit services and lending,” U.S. Eagle CEO Marsha Majors said in a press release. “This acquisition allows us to strengthen our commitment to serving those who are traditionally underserved.”
U.S. Eagle noted its interest in acquiring SWCB was strongly influenced by the credit union’s interest in augmenting cannabis-related banking business lines, as well as expanding its customer reach through the absorption of the bank’s network of branches and ATMs.
“Given our over 100-year history of dedicated service to the people of New Mexico, we are delighted to embark on this journey and new chapter with U.S. Eagle Federal Credit Union,” SWCB CEO Chez Steel said. “Their absolute dedication and commitment to community, service and, most importantly, people, align with our ideals in creating an exciting future of opportunity for all.”
In light of the latest acquisition news, the Independent Community Bankers of America (ICBA) continued its campaign trumpeting the concerns of community banks about the growing trend of tax-exempt credit unions purchasing tax-paying banks.
“As credit unions increasingly exploit their federal tax exemption to acquire tax-paying community banks, the need for policymakers to re-examine their tax status is urgent,” ICBA President and CEO Rebeca Romero Rainey said in a statement. “Action is needed now to preserve community banks and the communities that depend on them, ensuring the continued vitality of the relationship-based banking sector that has supported Main Street America for generations.
“Credit unions pay no tax to operate the same business that was taxable the day before once they acquire a bank. As public scrutiny of these inappropriate deals and the number of credit union purchases of taxpaying community banks have raced past record highs, policymakers must protect local communities by ending the credit union tax exemption,” Rainey said.
According to multiple media reports, more than 20 percent of bank transactions this year have involved credit unions purchasing banks.