GREENBELT, Md. — A merger - and the resulting integration of systems - that was supposed to require seven months instead was pulled off in slightly more than five months, earning $727 million-asset Educational Systems FCU a Credit Union Journal Best Practices award.
In April 2012, Educational Systems FCU, then a $390 million-asset credit union, posed a theoretical question to Fiserv, its account processing vendor. The CU asked if it merged with a credit union of similar size, could Fiserv complete a system integration project by year-end? Fiserv's response: a system integration related to a merger of that size required a six- to seven-month lead time and a year-end integration of data processors would be "very difficult" at best due to accounting, tax and regulatory issues.
Chris Conway, president and CEO of Educational Systems FCU, told CU Journal the opportunity to acquire troubled Montgomery County Teachers FCU was "vital" to the future of both CUs, as the combined entity would be able to serve a greater part of the Maryland education community by bringing together two "like-minded credit unions that shared the core purpose of serving the education community."
Moving Ahead With Merger
In late July 2012, Educational Systems notified Fiserv that it wanted to proceed with the merger, and that year-end would be the conversion target. Fiserv assigned eight experienced associates to develop a comprehensive integration proposal, which was accepted by the credit union and work began immediately.
"The compressed time frame to get this done is what made this merger spectacular," Conway said. "MCT was undercapitalized and in financial hardship, so once the merger was approved by its membership we wanted to move quickly because it had been a couple of years since it was able to spend money on infrastructure."
Conway said Fiserv was "great" throughout the process, supplying all the necessary resources to Educational Systems FCU's IT team to look at MCT's database.
"We had everything we needed in the weeks leading up to the conversion, which took place over New Year's weekend," he recalled. "When a few minor issues came up, Fiserv helped fix them."
The chief worry in a conversion such as this is the IT issues, Conway noted, but he said those all went smoothly.
"It was nice to see Fiserv step up," he said. "We did not feel all alone; we had everything we needed. Most conversions are planned six months to 18 months in advance. What Fiserv did was just short of a miracle. If we could not convert at year-end we would have had to wait until the end of the next quarter, and we really were not comfortable running two systems for three more months."
Despite the time pressures and the complexity of a conversion over year-end, the effort was successful. On the morning of Jan. 2, 2013, members of the new and much larger Education Systems FCU had access to accounts, products and services. It now serves nearly 90,000 members in six Maryland counties with 11 branches.
