Sunday, June 11, 2023

SECU Financial Update - April 30, 2023

 The asset slide continues...

 SECU                       March, 2023     April, 2023       1-month Change 

Total Deposits         $46.478 bil.        $46.122 bil.      (down -$356 mil.)

Total Assets             $50.775 bil.        $50.474 bil.      (down - $301 mil.)

Year-over-year deposits (April, 2022 vs. April, 2023)  are down $2.9 billion (-5.93%). Year-over-year assets are down $ 2.36 billion (-4.47%). For the first 4 months of calendar year 2023, deposits are down $552 million and assets are down $496 million. 

This Board's strategic plan calls for an 8% asset growth target for fiscal year 2023, which ends 6/30/2023. You'll note above that with 2 months remaining, actual asset growth is -12.47% below the strategic plan target.  

SECU                          March, 2023         April, 2023        1-month change

New vehicle loans       $ 944 mil.             $ 965 mil.           up +$21 mil.

Used vehicle loans      $ 2.723 bil.           $ 2.756 bil.         up + $33 mil.

It is harder to analyze SECU lending with limited data. The vehicle lending at SECU is the only lending sector currently affected by discriminatory risk-based lending (RBL).  Overall vehicle lending was up by @ $54 mil month-over-month, which seems to be in line with recent monthly growth  - no apparent surge in A-paper activity as yet, but it is probably too soon to tell. Without question RBL is overcharging the majority of SECU members who have lower credit scores.  Mortgage loans - without RBL - showed the strongest growth - +$220 mil.

One interesting note is that the total loan interest earned on all SECU loans in April, 2023 - vehicles, mortgages, credit cards, unsecured, etc (a total of over $30 billion in loans!) - was only $632,000  higher than in March, 2023. That small positive gain was easily offset by a $3 million increase in the provision for loan losses in April, 2023 over March, 2023. Loan losses continue to advance as a result of the centralization of collections snafu of 2022. Total loan losses almost doubled to $95 million in 2022 and have reached $60 million in just the first 4 months of 2023.    


As shown above,  this Board's strategic plan budget remains +14% over target (2.28%/2.00%) - that's about $140 million over budget. Most of the overrun appears to be in the seemingly inexplicable explosion in staff from @ 6,800 to @ 8,000. 


As a member, well... thanks a yacht!