The Albuquerque, New Mexico-based U.S. Eagle Federal Credit Union announced last week plans to close its cannabis banking arm, the Albuquerque Journal reports. The company said the closure of the Aery Group, which launched in 2019, is due to increased competition among financial services providers as the cannabis industry has grown. The Aery Group was one of the first New Mexico financial institutions to serve the state’s cannabis businesses.
The closure is set to take effect November 1.
In an interview with the Journal, Michael Moore, president and CEO of U.S. Eagle, said that servicing the cannabis industry is not part of the company’s long-term strategy. He stated that growing the service was “difficult…without going out of state or into other markets.” Moore added, “We’re not trying to shut the door permanently at all. Definitely not a ‘no,’ but a time-will-tell approach.”
Damien Padilla, owner of consulting firm Cannabis Driven Management, told the Journal that there are at least 19 financial services providers in New Mexico now working with cannabis businesses. Padilla said that the increased competition is “just one of those things that comes with every market.” This growth has attracted more competitors to the banking sector as the industry expanded.
U.S. Eagle determined it could not sustain the service under these conditions. The decision reflects the broader competitive pressures in the sector. Other institutions continue to operate in New Mexico’s cannabis banking space.
The departure of U.S. Eagle does not eliminate all banking options for cannabis businesses. The remaining providers will continue to serve the local market.
Moore emphasized that the closure is not a permanent rejection of the sector. He stated that the company is definitely not a “no” to future involvement. The decision is based on current strategic priorities and market conditions.
U.S. Eagle will reassess its position as the industry evolves.
The Aery Group will cease operations on November 1. Clients of the unit will need to transition to other financial providers. The Albuquerque Journal reported the details of this transition plan.
This move highlights the challenges of serving a niche market with limited geographic scope. Moore indicated that expanding into other states or markets was not a viable option for this specific service.
The company will focus on its core credit union operations. The cannabis banking arm will officially close at the start of November.
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