Garden Savings President and CEO Louis Vetere said the growth strategy has been in the credit union's cards for more than five years, but it didn't advance on an opportunity until November 2012, when the 6,000 members of Morristown Federal Credit Union approved a plan to add its branch locations in Morristown and Dover to Garden Savings' existing branch portfolio in Parsippany and Newark, effective Jan. 1.
"Morristown is very similar to us, in that it has a large corporate sponsor in Honeywell and an underserved population in Dover, and we have a large corporate sponsor in Alcatel-Lucent and then an underserved population in Newark," Vetere said. "We know how to manage that different composition of membership, so we see a lot of opportunity for us in their network."
But a month later, Vetere said the newly combined 21,000-member credit union took a different approach in acquiring NWNJ Federal Credit Union and its single branch location in Denville. The 700-member firm was struggling financially and lacked the resources to offer a more extensive product and service menu, he said, so it proposed to join forces with Garden Savings effective Feb. 1.
"You need to be stronger to survive in a regulatory environment that's getting more and more difficult, with an interest margin squeeze that's making it difficult to make money and survive," Vetere said. "I think you just need a certain size to survive, and I think we now have enough mass and the technical expertise to navigate the changing regulatory environment."
Both surviving entities are operating under the Garden Savings name.
Though Vetere said he wouldn't immediately rule out prospective mergers with other financial institutions, he noted Garden Savings is "not going to actively seek out any others," and "we're basically North Jersey-based, so I don't see us going beyond Morris, Essex and Union counties."
With the credit union's two recent mergers, Vetere said Garden Savings expanded its asset portfolio from $212 million to approximately $280 million, as Morristown Federal Credit Union contributed about $65 million in assets — mostly from the accounts of Honeywell employees — and NWNJ contributed an additional $2 million in assets.