The financially struggling Sparks City Employees Federal Credit Union plans to merge with Great Basin Federal Credit Union.
The boards of directors of both credit unions have OK'd the merger, which would create a 16,400-member financial cooperative with assets of more than $116 million.
That would create the third-largest credit union in the region, one that trails only Greater Nevada Credit Union of Carson City and First Horizons Credit Union of Hawthorne in assets.
The merger requires the approval of the members of Sparks City Employees Federal Credit Union and also awaits the approval of the National Credit Union Administration.
In documents filed with the National Credit Union Administration, the Sparks credit union reported a loss of $142,632 in 2011. That came on the heels of losses of $187,572 in 2010 and $334,550 in 2009.
The credit union's assets of $13.3 million at the end of last year were down 13 percent from 12 months earlier.
Its assets included a loan portfolio of $4.3 million.
By contrast, Great Basin Federal Credit Union posted net income of $2.1 million last year and $1.3 million in 2010.
Sparks City Employees Federal Credit Union was established in 1958, and serves about 1,900 members from its single branch. Its assets rank it as the third-smallest credit union in northern Nevada.
Great Basin was established in 1951 by a group of 50 telephone workers, and has more than $100 million in assets, more than 14,500 members and three branches. Its membership now is open to anyone living or working in Washoe County.
Diana Dykstra, chief executive officer of the California/Nevada Credit Union League, said similar mergers involving small credit unions may become more common.
"It's really, really hard to stay competitive," she said of small institutions.
Increasing regulatory requirements, the development of new products and the advent of new technology all pressure the financial resources and the often-tiny staffs of small credit unions.
Sparks City Employees Federal Credit Union has three employees, who will join the staff of Great Basin.
Renee Lavallee, chief executive officer of Sparks City Employees Federal Credit Union, noted the merger will bring more branches, mobile online banking, and wider services to members of the credit union.
Credit union mergers have been relatively rare since the start of the Great Recession. That's probably because most management teams wanted to see how the economy recovered before they took any big steps, Dykstra said.
"Now that they've come through it, they are looking at how they can better serve their members," she said.
In December, for instance, Reno-based Sierra Pacific Federal Credit Union completed a merger with Southwest Gas Federal Credit Union of Las Vegas.
