HUNTSVILLE, Ala.-As credit unions clean up from one of the worst string of tornadoes to ever strike the southern U.S., they're also straightening up disaster recovery plans.
Twisters that took the lives of more than 300 people across five states fortunately spared most CU facilities, and problems credit unions faced resulted largely from extended power outages. Credit unions in the affected areas told Credit Union Journal their disaster recovery plans allowed them to effectively serve members in the storm's aftermath, yet a number said the major storm taught them lessons that will improve recovery plans in the future.
Credit unions, too, reported they were meeting membership needs by relaxing loan underwriting policies for those in need, having more cash on hand, and being prepared to accept what could be a significant inflow of deposits from members who will be receiving big insurance settlements.
Joe Newberry, CEO of the $3-billion Redstone FCU here, had all 20 of its branches down for at least a day and many were without power through the middle of last week. But thanks to the credit union's disaster recovery plan, virtually all of its 26 ATMs worked without any lengthy service interruption.
Redstone had gasoline generators on hand to power its ATMs, which were functioning in time for members to withdraw more than $1 million in cash the first two days after the storm. "It turned into a cash society for a couple days," Newberry told Credit Union Journal. "Communication systems were down and so was plastic. Fortunately, we were able to keep our ATMs running."
Newberry said Redstone's cash supply company kept ATMs stocked and the credit union diverted cash from closed branches to the machines. Yet what made the difference was a dedicated facilities team of more than 10 people that maintained and refueled generators around the clock. That included searching for gas stations with power to pump fuel. "Luckily, too, we had some facilities vehicles we were not using and siphoned gas out of their tanks," Newberry said. "We came close to taking gas from a couple repos we had on our lot."
While the disaster plan worked, the CEO acknowledged that foraging for gas over an extended period of time was not in the design. "When all this settles, we'll likely consider some sort of electric redundancy system."
Glitch In Recharging Batteries
In Birmingham, Ala., the $1.3-billion America's First FCU's disaster plan called for laptops with wireless broadband cards to conduct transactions at branches without power. The plan worked at locations that were down for a short while, which was the case at the majority of its 18 offices. But its Cullman, Ala., location did not have power for several days, and without a generator on hand the credit union could not recharge laptop batteries.
EVP Vickie Yaeger said America's First improvised and bought inverters, electrical devices that convert direct current to alternating current. "We hooked the laptops up to car batteries."
Yeager said that AFFCU's updated disaster recovery plan will include stockpiling inverters, but not car batteries, which were easy to find on store shelves.
John Dee Carruth, CEO of the $580-million Alabama One CU in Tuscaloosa, Ala., told Credit Union Journal his concerns were for the families of six members who died, and for a former volunteer who was still missing at press time. Carruth was thankful, though, that more lives were not lost, including CU employees after the main office was spared major damage-just a hole in its roof and water inside. "We were fortunate. Look north, east, and west of the office and you see total destruction."
AOCU's disaster plan placed its data center below ground in a sealed basement, so it avoided any water damage. "The data system never went down," Carruth explained. "It was a seamless transition from power to battery to generator."
While Carruth was pleased with the performance of the disaster plan, he said adjustments will be made in one area-communicating with employees after a bad storm. The CEO said the credit union will make sure it devises a communications process that allows it to connect with employees, or have them check in, when communications lines are broken.
That aspect of disaster planning was addressed by a number of CU executives who spoke with the Credit Union Journal, saying concern for employees was great after the storm knocked down land lines and cell towers.
'Shudder To Think'
At the $50-million Tuscaloosa FCU in Tuscaloosa, Ala., CEO Tommy Cobb said a low-tech solution worked well for one office that was without power for a day or two. Rather than bring a generator to its Skyland branch, the credit union posted a sign on the door with instructions to call or stop by its other two locations that were operating. "Our members did not mind at all," Cobb said.
In the storm's aftermath, Cobb was aware that a local financial company that did not store its records in a vault had customer data strewn all over the state. Cobb said TFCU has all of its active documents in a vault, but has older records in storage rooms at the credit union. "We have the space. But now we will go through those old records, properly destroy those that are not necessary to keep under records-retention rules, and then store what's left in a safer place."
Kevin Maguire, CEO of the $34-million DCH CU, is also concerned about safety with the credit union's disaster plan, but his attention is on people. The CU's lone office suffered extensive damage, including a hole in the roof and windows blown out. Employees and members took cover in the location's two bathrooms, which are well inside the CU and have no windows.
"I asked everyone to get into the safe, but they were afraid to step into the vault. The plan for the next storm will be for everyone to get into the safe. I will pull it shut from the inside and leave a sign on the outside of the door that says people are inside."
Maguire made the call after looking outside the credit union after the twisters roared through, seeing buildings leveled all around. "If we would have taken a direct hit, I shudder to think what would have happened."