Mirta Martin received a phone call with the bad news at 6:30 a.m. Friday: Hourly employees at Ferrum College, where she serves as president, had not received their pay deposits.
The private college in Franklin County had submitted its payroll instructions to its bank the prior Tuesday, May 28, and had checked in twice over the following two days to ensure that everything was good to go for payday on Friday, Martin said.
But Ferrum College was a yearslong customer of Danville-based American National Bank & Trust, and May 28 was the day that Atlantic Union Bank out of Richmond announced it had finished migrating American National’s customers into its systems after a merger that closed earlier this year. Multiple customers have reported problems with deposits and accounts in the wake of that announcement.
Martin said the merger has been a “fiasco of monumental proportions” for Ferrum College and as of Wednesday — despite multiple phone calls, an apology from the bank and a visit from two sympathetic former American National executives — the payroll matter had yet to be resolved. Some employees who erroneously received two or three deposits on Monday saw those same amounts withdrawn from their accounts on Tuesday.
“Very candidly, I’m so upset,” Martin said.
Martin said bank officials have not provided a specific reason for why the bank failed to properly process the college’s payroll, simply saying it was a “glitch in the system.” She said one bank employee suggested that the bank did not anticipate the high volume of transactions that arose from May 31 being both a biweekly payday and an end-of-month payday, a notion that Martin, a former bank executive herself, called “ridiculous.”
Atlantic Union Bank President and COO Maria Tedesco said in a statement to Cardinal News that the merger between Atlantic Union and American National “remains on track” but that “we recognize bank mergers can cause service disruptions for customers.”
“Systems conversion occurred at the end of May, and since then we have been helping our newest customers navigate the new-to-them systems they will be using going forward,” Tedesco said. “Due to client confidentiality, we are unable to disclose details of specific customer issues. We have been working directly with our customers to resolve any issues with them as quickly and efficiently as possible.”
On Tuesday, Ferrum College manually wrote checks for 110 hourly workers to cover their missing pay. It will do so again for the next payday on June 14; Martin said she told Atlantic Union officials that until the problems are fixed, the bank will not handle payroll for the college’s hourly employees.
“I am not willing to bet on the bank against my people. My people will always come first,” Martin said.
The school has approximately 250 total employees. Payday for salaried employees will be June 21, and Martin said the college will test the bank handling payroll for those employees at that time.
Ferrum College isn’t alone in experiencing a payroll issue following the bank merger.
North Carolina news media reported that employees of the Alamance-Burlington School System in Alamance County, North Carolina, also woke up Friday to missing paychecks due to a technical issue with Atlantic Union Bank. The school system previously had banked with American National.
“I’m sure they’re shaken up,” the school system’s interim superintendent, Bill Harrison, told Fox affiliate WGHP, referring to the school employees. “I would be shaken up as well.”
The CBS affiliate WFMY reported that those employees began receiving their deposits later that day.
The integration of Atlantic Union and American National operations capped off a merger that was valued at more than $500 million and which created a combined firm with nearly $24 billion in deposits and more than 130 branches in Virginia, Maryland and North Carolina under the Atlantic Union name.
“Following our detailed merger integration playbook to seek to ensure a smooth transition, our teammates have worked diligently on the data conversion and systems integration of American National since the merger announcement last summer,” Tedesco said in a May 28 news release.
“Not only does this successful integration result in a unified bank presence across Virginia, North Carolina and Maryland, but also helps us build on our commitment to provide the conveniences, services and products that are most important to our customers.”
On Atlantic Union’s Facebook page, a post celebrating the integration was met with a mixed response.
One customer commented on May 29 that two deposits should have been posted to her account on May 26 but hadn’t.
“Been sitting in a packed full waiting room at the local branch with people with similar issues and no answers, smooth transition is a false statement,” she wrote.
“I must be lucky,” wrote another commenter. “Been a seamless transition for me. No issues.”
The Roanoke Times on May 30 reported concerns from a Rocky Mount resident who called the newspaper to say that he manages his mother’s former American National account and was unable to pay her bills as he usually did. The paper also quoted two customers who were satisfied that their issues with the transition were resolved within a day.
Meanwhile, Martin said that Atlantic Union’s still-unresolved error in processing the college’s payroll was “unconscionable,” especially because it affected hourly employees and student workers.
“These are people who do some of the most necessary jobs in the college but are paid the least,” she said.
And she’s concerned that people will interpret payroll problems caused by the bank as a sign of trouble with Ferrum College’s finances — not so, she emphasized.
“Ferrum College is a strong financial institution. We are open for business and we are here to stay,” she said.
