Time to retool? Shifting strategy at the state’s big credit union raises debate over balancing member needs
Chris Ayer joined the North Carolina State Employees’ Credit Union in Raleigh as a software coder in 1988 after working for a Roanoke, Virginia, bank. His initial salary was about the same as his wife’s paycheck as a Wake County school teacher.
Ayer eventually became the credit union’s chief technology officer. But he says he didn’t realize why his job really mattered until receiving a call in 1999 from a member who wanted to know his account balance.
Credit union policy blocked IT staffers from sharing customer information, so Ayer mentioned other options. The guy wasn’t impressed, so Ayer urged him to walk into a local branch and talk with a teller.
I’m a quadriplegic, so that’s not an option, the member responded.
That’s when SECU’s culture of putting members first really hit him, Ayer recalls. If that meant driving to the member’s home and delivering the information personally, that’s what you did.
Seventeen people started SECU with $437 in 1937, when the U.S. was mired in depression. Today, it has $53 billion in assets and is the second-largest U.S. credit union. It has nearly 8,000 employees in 100 counties and 2.6 million members, or more than one in five North Carolinians.
No one disputes the credit union’s remarkable achievements. Now, though, how it operates is being challenged by insiders who say some of its distinctive policies need updating in a fast-changing sector. Like most change, it’s causing sparks, in this case from critics who say SECU is straying from its core mission.
SECU has never lost money in 85 years, booking a net gain of more than $1 billion over the last two fiscal years. It holds much more capital than required. Credit unions don’t have shareholders and are considered not-for-profit.
Three North Carolina megabanks — Bank of America, BB&T (now Truist), and First Union (renamed Wachovia, then Wells Fargo) — grew through hundreds of acquisitions, mostly out of state, engineered by aggressive CEOs. The dealmaking worked great, until it didn’t: Wachovia, BofA and BB&T received government bailouts after the late-2000s housing depression. Each bank repaid the money.
SECU stuck to internal growth, a unique consumer lending strategy and a culture that motivated good customer service.