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SASEBO NAVAL BASE, Japan – The financially troubled USA Federal Credit Union will merge with Navy Federal Credit Union -- a larger competitor that also serves U.S. military bases in the Pacific -- both credit unions said Tuesday.

San Diego-based USA Federal, which operates 11 branches in Japan and South Korea and eight in southern California, said recently that it was considering mergers after being rocked by bad mortgages and the global economic recession.

Its branches will become part of the Navy Federal network Oct. 1, pending approval by the National Credit Union Administration, according to a joint news release.

The boards of directors at both unions approved the merger, and members and all employees of USA Fed will be invited to join Navy Federal, officials with the credit unions said.

“Everything will remain the same for USA [Federal] account holders - online access, direct deposits, etc.,” Navy Federal spokeswoman Jennifer Sadler said in an e-mail response to Stars and Stripes.

Meanwhile, all USA Federal branches will remain open after the merger next month, she said.

The credit unions said Tuesday they will notify members and post additional merger information on their websites.

USA Federal held a niche in the credit union market serving the military but was dwarfed by Navy Federal.

The credit union now holds just $604 million in assets and serves 57,000 members, according to records filed with the NCUA.

Navy Federal has over $41 billion in assets and 3.4 million members, agency records show.

The merger will leave Navy Federal with over 200 branches worldwide, including 22 located in Southern California.

trittent@pstripes.osd.mil

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