By Micki Milonas, VP Marketing, West Community Credit Union, O’Fallon, Mo.

In 1984, a group of students and professors at the University of Missouri-Columbia (MU) founded the Missouri Student Federal Credit Union (MSFCU) because they were unhappy with the quality of services offered by area banks. Since its inception, the credit union has operated under the philosophy of “students helping students” and is one of a handful of student-run credit unions in the United States. The credit union provides valuable internship experiences for about 40 students a year, who are responsible for running all aspects of operations. It developed a reputation of being fairly progressive, offering products such as free checking before many area banks.

The students were proud of their credit union, and its 600 to 700 members were always extremely loyal. But in the late ‘90s, technological advances began to change the financial services environment. Students entering the University wanted electronic convenience services such as online account access, bill pay, debit cards and credit cards. Alumni were looking for competitive rates on home equity products and mortgages. Unfortunately, MSFCU could not afford the technology needed to offer these services, and they lacked the experience and manpower to manage them. They also lacked an effective marketing budget and expertise to compete successfully.

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By John Bommarito

Except for corporates and the State Farm credit union aggregation, the largest merger of equals in credit union history was in 2003 between the TRW Systems FCU and the former Western FCU. I had been the President and CEO of the TRW Systems Federal credit union since 1994, and can report that the merger did what we said it would do: benefit the members of both credit unions while making the new Western FCU a stronger and more competitive financial service provider.

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By Rodrick H. Chatt

As John Bommarito has discussed, each had Boards of nine members. I was the chairman of the TRW Systems FCU Board. Everyone on our Board agreed that the merger would be in the best interests of the credit union members. So one of the first things I did early in the merger discussions was to put the following to our Board members: Should we be willing to put aside our own egos to accomplish the merger, and if so: 1) What would the ideal size of the new Board be? 2) Are you willing to resign from the Board to accomplish the merger? and 3) Are you willing to serve on the Board of the new credit union?

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David Barton, CEO of Gateway Metro Credit Union of St. Louis, Mo.

Probably 10 local credit unions turned down an opportunity to merge with Guadalupan Credit Union of St. Louis, Missouri. And who could blame them? It was a 457-member, parish credit union with only $320,000 in total assets operating out of the basement of an elementary school in a “not-so-upscale” neighborhood. Almost 40% of the membership was Hispanic.

Some credit unions thought that the kind of merger one with Guadalupan held in prospect are “a dime a dozen.” This one was too small. It wasn’t worth the trouble.

Then along came Gateway Metro, a $170 million, 25,000 member community credit union headquartered in downtown St. Louis. After extensive research, Gateway Metro decided to merge Guadalupan into its membership.

We didn’t simply look at the numbers, we focused on the potential.

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By Shawn Birch, Project Manager, United Federal Credit Union, St. Joseph, Mich.

Most merger stories are told from the point of view of the CEO, the point of view of strategy and overview.

Not this one.

I was no one’s CEO. I was the person put in charge of stitching two merging credit unions together. I didn’t even learn about the merger until it was announced to the staffs.

I worked in the trenches. We had to make a working $700 million credit union out of the $480 million First Resource Federal Credit Union in St. Joseph, Mich., and the $215 million United Federal Credit Union in Buchanan, Mich. (The name United would be retained by the new credit union.) Both credit unions had members around the world and branches in three states; most branches were in southwestern Michigan, but some were in North Dakota, Arkansas, Ohio and North Carolina. The merger was announced to the staffs on July 12, 2006, as yet without NCUA and member approval; we had until October 1 to pull off the name change and dual service in all southwest Michigan branches and until April 1, 2007 to complete the data conversion.

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