Marriage Of Giants Is On Track For Jan. 1
PALO ALTO, Calif.-One of the biggest stories of 2010 was the largest credit union merger ever: Addison Avenue FCU, based here, and First Tech CU, Beaverton, Ore., are combining to become First Tech FCU on Jan. 1.
The combined institution will have assets of $4.7 billion, 38 branches across eight states and Puerto Rico, approximately 800 employees, and serve some of the world's most well-known companies, including Hewlett-Packard, Microsoft, Agilent Technologies, Intel, Cisco and Nike.
Benson Porter, Addison Avenue's president and CEO, will serve as president and CEO of the combined credit union. Just days after the merger gained final approval from First Tech members, Porter told Credit Union Journal he is ready to kick off the New Year with a new name and a new focus.
"We are moving into execution mode to deliver all the benefits we talked about over the past several months," he said. "Now it is 'prove it' time."
Porter anticipates it will take through mid-year 2011 to perform the system conversions and get all the platforms coordinated between the two institutions.
"We view this as not being a short-term effort. We are bringing two healthy organizations together and expect it to become a common culture. It will take a concerted effort."
The two CUs have been aided by the fact that even during the recent recession and lagging recovery, the companies they serve have been relatively healthy, Porter noted. "Although we saw charge-offs and delinquencies go up some, as everyone has, the technology sector has been a little better off than other sectors. Most of our sponsors have strong business prospects going forward, including HP and Agilent. And there will be a lift from more members having access to our increased footprint. We will be more efficient and deliver value back to the membership. We foresee a flat operating budget despite the merger-related costs due to the synergies of operating together."
'Running In Parallel'
Porter said both CUs have been "running in parallel" for 20-plus years in terms of size of the organizations, member strength and other factors. "We had partnered quite a bit and shared a lot of information and support so there was a great working relationship. It was a marriage analogy in that we dated without knowing we were moving on toward marriage. Mergers are not for everybody, but for us it worked well because we were mirror images of each other."
Addison Avenue FCU served more than 155,000 members nationwide with a field of membership that included employees and family members of Hewlett-Packard, Cisco and Agilent Technologies.
Established in 1952, First Tech CU was a $2.2 billion institution with 165,000 members. It served employees in the high tech, telecom, education, and government sectors through a 17-branch network in Oregon and Washington.