Despite NCUA Order, Educational Systems-Montgomery County Teachers Merger Still Proceeding
The pending Maryland merger between the $367 million Educational Systems FCU and the $393 million Montgomery County Teachers FCU is still on, according to Educational Systems President/CEO Chris Conway.
This despite a cease and desist order announced late Tuesday by the NCUA in response to exam exceptions.
Conway says he was not caught unaware by the federal regulator’s announcement, saying “MCT has kept us informed along the way, so we were aware of this.”
The NCUA’s cease and desist order requires Montgomery County Teachers to comply with regulatory and supervisory requirements pursuant to Prompt Corrective Action; ensure the financial statement audit is completed and all accounts are reconciled by May 31, 2012; and address operational deficiencies and strengthen internal controls.
Credit union officials have agreed to the terms of the order, the NCUA said
“We’ve been supportive of MCT’s board during this tough time, and we’re continuing to work toward a successful merger,” Conway said.
The two credit unions signed a letter of intent to merge April 12. MCT has struggled financially, reporting a nearly $740,000 loss in 2011, and has been below 5% net worth since June 2010, when it slipped to 4.13%. The credit union has not been considered well capitalized since December 2008.