Sunday, February 4, 2024

SECU - 2023 Year End Financials - Validating The Historical Trends

 https://insightextractor.com/wp-content/uploads/2014/11/downward-trend.jpg ... follow the error.

If you've followed the fever-pitch squabbling in the comments recently, you'll find two recurring themes: collections and centralization/specialization. 

Changes in these two perspectives - since "The Big Snafu"(BS) began at the end of 2021 - have been costly to SECU member-owners - very costly! Collection centralization has increased loan delinquency and loan charge offs (losses) by tens of millions of dollars. The centralization and specialization of service delivery is worse, causing operating expenses to soar dramatically - up by over +$225 million annually over historical levels. You can check out the SECU Board's own performance scorecard (as reported and as adjusted) at the January 31, 2024 post [link].

You might like to see the official historical trends as reported by the National Credit Union Administration (NCUA) in these critical cost areas - operating costs and charge offs - which are real, hard dollar costs to members. Mike Lord was the CEO of SECU from 2016/2021 - note the conservative, competent and consistent record of stewardship - until "The Big Snafu"(BS) got underway in earnest in 2022:

Year-end      Op. Expense      Charge Offs    

  2023                 2.42%                 .62%               

  2022                 2.08%                 .35%                

  2021                 1.70%                 .20%              

  2020                 1.87%                 .30%               

  2019                 1.89%                 .43%               

  2018                 1.84%                 .45%

  2017                 1.77%                 .40%     

  2016                 1.77%                 .33%   

Small percentage changes might mislead you into thinking: "ain't that significant", but remember when you're dealing with billions of dollars - everything is big, especially snafus! For example, lets compare the change in operating costs from 2019 (1.89%) to 2023 (2.42%) - an increase of + .0053%. Well, @ $50 billion in assets x .0053%= an increase in annual operating costs of +$265 million! If loan losses have increased from 2018 (.45%) to .62% in 2023, that +.17% increase represents over +$56 million in additional loan losses in just one year - in the midst of a strong, positive economy! 

😎 Change is great...

... BS is expensive!

 

25 comments:

  1. If SECU wasn't built on a Rock they would be in serious trouble ... still are with the current mindset ...

    ReplyDelete
  2. Wow, just wow!

    What an abject failure the Legacy Board, Hayes and current CEO have been. All the big changes - outside staff, new processes, and "improving the member experience" for the numbers to confirm the failure of it all.

    ReplyDelete
  3. Hard to argue with the numbers that are laid out in black and white. Guarantee there's gonna be some that try to do it, though. The membership and employees deserve so much better. Just remember - 4 more in '24!

    ReplyDelete
  4. This is the reason for moving MLOs out to branches. An eyewash for October elections. This is the first step. More to come.

    ReplyDelete
    Replies
    1. I doubt that will do much I think the big problem is RBL.

      Delete
    2. Hope springs eternal.

      Delete
  5. Do we still have the crisis management consultants on retainer? Yikes!! From dark to light!

    ReplyDelete
    Replies
    1. Wish there was a thumbs up button to like the comment.

      Delete
  6. Not all change is for the better... just because you can don't mean you should! We lack critical thinking skills ...
    They don't teach that anymore and haven't in a long time.
    (there's always exceptions but not the rule)

    ReplyDelete
    Replies
    1. Lol is the exception to the rule that sometimes all change is good.

      Delete
    2. In Gym's world ...

      Delete
  7. MLOs better be grateful if we'll take them!

    Mortgage Layoffs: Latest updates:

    Fairway Independent Mortgage Corp. to shutter wholesale lending division (2/2/24)
    Newrez layoffs (2/2/24)
    Crescent Mortgage Co. to shut down, lay off 65 employees (1/31/24)
    Heritage Bank to exit retail mortgage lending (1/25/24)
    Country Club Mortgage to let go of 105 employees in Central California (1/17/24)
    Wells Fargo mortgage layoffs (ongoing)
    Truist Financial to close bank branches, cut mortgage jobs (1/8/24)
    Kinecta Federal Credit Union layoffs in El Segundo, CA (1/3/24)
    Pennymac to lay off 84 workers across Southern California (12/29/23)
    Dovenmuehle Mortgage to cut 212 jobs in Lake Zurich, IL (12/19/23)
    Premier Nationwide Lending (NTFN Inc.) layoffs (12/17/23)
    TD Bank to cut 3,000+ jobs, rework real estate footprint (12/1/23)
    Fairway Independent Mortgage layoffs (11/28/23)
    Bank of New Hampshire stops accepting residential mortgage applications (11/15/23)
    Associated Bank to cut 3% of workforce (11/10/23)
    Orchard cuts additional staff (11/9/23)
    Maxex layoffs (11/7/23)
    Homie conducts more layoffs (11/7/23)
    Bank of the West to let go of 41 employees in Omaha, Nebraska (11/2/23)

    ReplyDelete
    Replies
    1. The economy is fine rant the pundits ....
      You can't lie your way out of the truth ... Sorry!

      Delete
    2. These are our co-workers and many of them are long term employees who have dedicated their careers to helping members. Many of them took the job because they like helping members with their mortgages and we were all told to follow our passions. Let’s welcome them back to the team with open arms as we are all in this together for our members.

      Delete
    3. I agree. @11:58

      Delete
    4. They showed their true colors. We’d be better off with them gone!

      Delete
    5. Thank you I agree. With no idea what long term would happen don’t think it’s fair to say they should have expected this so don’t do anything. I understand people are upset but they took a chance based on the information that was given. It did not work out like they wanted it to they now their coming back.

      Delete
    6. You, whoever you are, are the real problem. Your negative attitude is a drain on your coworkers and branch. What are you even saying anyway. The credit union has to have mortgage lenders and MLS are the only ones who can do mortgages. The credit union has never laid off employees and in way worse climates than this. The bigger expense issue the executive level bloat that was created under the former CEO and the waste on some unneeded software and vendor contracts.

      Delete
    7. @11:58 I can find a spot for them on my drive thru! Time they got a taste of their own medicine. Let’s see if they can “pursue their passion” there!

      Delete
    8. Easiest and least stressful job I ever had was drive thru. Miss it often.

      Delete
    9. @3:56 yea that makes lots of sense.

      Delete
    10. @3:56 your drive thru?? I take it you’re either in the drive thru or managing it then. How bout you do the mortgages and I’ll take your easy job? Please be my guest!

      Delete
    11. @9:50 TCD does half the job for you!

      Delete
    12. This comment section shows why the Jack of all trades is needed. Putting down others and their job is what these higher ups want. Don’t feed into the BS. Unite. Every job and worker has a struggle in common and it’s the executives and board. Your enemy isn’t a teller. Get over yourselves

      Delete
  8. @12:22 you’re exactly right. Where you at 3:56? I’m ready to switch positions when you are 😂

    ReplyDelete