... The SECU Boards approves the financial goals for the Credit Union. And, should monitor staff performance against those standards.
✅ Lets see how the Board and Executive Leadership Team (The ELT) are doing:
We talked in the last post [link] about the mis-performance in lending losses and delinquency which are SECU Board "Key Ratios". Three other key ratios also tell a costly story.
But first remember, SECU has borrowed $5 billion from the Federal Reserve without a clear financial reason, other than profiteering. The effect of that borrowing is to increase SECU actual "assets" from @ $50 billion to $55 billion - which falsely "inflates" these ratios. Why? Because that $5 billion loan must be paid back to the Fed at the end of 2024. (The interest SECU paid on that Fed loan in the first quarter was $59,479,452!... which will be @ $240 million for all of 2024!)
So, we need to adjust the assets down to the legitimate $50 billion before "figurin'" the real ratios:
- Capital to Assets: real ratio @ 11.1% not only above the Board approved 9% key ratio target, but even outside the Board approved range! If the Board had met its 9% target, an extra $1 billion could have been paid out to members via better rates on your savings accounts.
- Expense to Assets: real ratio @ 2.35%, well above the SECU Board target of 2.00%, and not declining as inferred! Based on historical SECU expense levels of 1.85%, these extra operating expenses are costing you over $200+ million annually.
- Asset Growth: The real "chuckler" in the bunch! The assets of SECU were $50.775 billion on March 31, 2023 and were $50.872 billion at March 32, 2024 - a growth of @$97 million over the last 12 months. That's a real growth rate of @ 2/10ths of a percent, not 10.04%! SECU members have actually withdrawn @10% of their deposits over the last "new/new" 3 years!
... why have "key ratios" if the Board and ELT are going to ignore them?
... why have "key ratios" if the Board and ELT are going to ignore them?
ReplyDeleteBecause they sound good?
credit union or crooked union? Deceptive practices for sure.
ReplyDeleteUggggghhhhhhh!!!! I know we’re gonna vote some more people out…but are members organized in any way that I can tap into? I feel rather alone wringing my hands over this day in and day out while the CU just tanks. Anyone out there have a union forming for our credit union?
ReplyDeleteIf the MSS contact centers have to do shift bidding again this summer I suspect that there will be more than just rumblings of union
Deletewon't this hurt 'their profit" ..........
ReplyDeletemaybe lay off those high priced 'new' executives ....
they can go find their passion in the banking industry ...
take LB with ya ....
and The Eight turncoats responsible for this
DeleteUnfortunately, 'they' have to be voted out ...
Deletewe can start with 4 more October ...
heyyyy none of this matters, what's important is that there's a new Web Site coming .... !!!!
ReplyDeleteHow much did they charge us for that? A new site to show us how little we get on deposits and how much they charge us on loans now.
Delete"You spoke, and we listened."
Delete'They' said this was what the members wanted ...
I think I missed that polling ... guess I was too busy watching SECU go down the drain ... my bad!
The board is not ignoring the numbers at all. They borrowed $5 billion dollars to hide what was happening from us—the members. Paying $249 million in interest, but not enough money to increase our savings rates!? It is painful to watch Brandon, Wooten and Brady with their long histories at SECU follow that swindler Hayes. What are they thinking? Members will never know because this board and leadership won’t answer our questions. Only the questions Brady wants to answer. Lots of talking AT us. NO listening to us. Clean sweep. 4 in 24.
ReplyDeletebbbs, bbbs, bbbs, bbbs, basic brady bull she...
ReplyDeleteBrady is a a nice person in over her head. If she weren't a female...
ReplyDeleteThe road to hell is paved with good intentions ...
DeleteBrady is nothing but nice. Y'all all know that but won't admit.
DeleteLeigh Brady always acts in good faith.
DeleteShe's NOT a good person. Period. Self centered and greed driven is more like it. Employees have known for a long, long time Poor Leigh is a snake. Branch & MSS employees are beneath her. We see right through she/her.
DeleteNever assumed I was anything more than the dimmest bulb in the box so a little help would be appreciated Mr. B. The expense ratio I kinda get - blew it up with too many high priced hires, too many consultants and too many long term vendor contracts signed in too quick a time among other things. And at the same time assets were decreasing. Can’t fix that overnight.
ReplyDeleteJuicing the assets with the Fed loan seems pretty clear - artificially inflate assets (and take some “free” money from the Fed by arbitraging) to help all the metrics look better, at least in the short term.
Somewhere in the ballpark on those two?
The one I don’t get is why the excess capital? What’s the goal to over-withholding the member’s money significantly above the regulatory requirement? Any chance they are anticipating a liquidity shortage with deposits running out the door and charge offs exploding? Your insight would be appreciated, I’m sure I don’t understand something.
Thankfully starting to see some of the fluff hired in under JH start to leave for greener pastures.
DeleteIs The Economic System Being Destroyed On Purpose?
Delete1:03 - You're dead on with the first 2 items - inflated assets, inflated costs. SECU enjoyed 85 consecutive years of real asset growth and effectively controlled operating costs - operating expenses which were @ one third lower than the average operating costs of peer ("industry standard"!) credit unions. A proven record over all economic cycles.
DeleteThe third one - "capital ratio" - is pretty straight forward too. Above all else you want to operate a safe and sound credit union (because a lot of people - employees, members and their families are counting on you!). The "capital ratio" is the single best measure of safety and soundness. It gives you an idea of how well SECU can weather adversity if "things go bad" - like the economy, a war, poor lending.
Federal law requires a credit union to maintain a capital ratio above 7% to be considered "well-capitalized" (safe and sound). The SECU Board "target" is 9%, well above the 7% required level. The actual capital ratio is 11+%, not only well above the legal requirement, but also above the "9% Board target" - it even exceeds the Board approved maximum range of 10% - that's really bizarre!!! The SECU Board and the ELT are mismanaging SECU capital... according to their own goals!!!
So what? Well, according to the Board, SECU doesn't need 11+% capital to be safe and sound!!! The SECU Board says 9% is a reasonable "target". That excess 2% (11+% actual ratio - 9% target ratio = 2% excess capital) is equal to $1 billion ($50 billion assets x 2% excess = $1 billion buckaroos!)
That $1 billion is inappropriately being withheld from the members - based on the Board's own goals! The Board could pay members $1 billion right now and SECU would still be well-capitalized, safe and sound.
Two questions:
1) Why is the Board doing this? Beats me, but seems to imply the Board may not have a firm grasp on their fiduciary responsibility in a cooperative.
2) Could you as a member use an extra $1 billion in your pocket? (Thought so!)
Apologize for the "excessive" response....
1:03 - One more thing about that capital ratio. If 7% is well-capitalized by law, then 9% has got to be safer, and 11% even better, right?
DeleteNo, that's not right? "Excess capital" is not better, because it comes at a cost to the members...the Board and ELT don't get that idea obviously.
The Board - according to their own analysis and "9% target" - are unjustly withholding $1 billion from you and other members. Most members would probably enjoy having an extra $1 billion to spend on such luxuries as food, shelter, clothing - and credit card payments!
Think of the 9% Board capital target as a 9 gallon bucket. Once you fill 'er up, trying to put in two more gallons is a waste. Won't make the bucket "fuller", will it? Doesn't really make SECU more safe or more sound - the SECU safety/soundness bucket is already full according to the Board approved 9% target. It's just lazy management.
Poll the membership! Ask 'em if they'd rather have an extra $1 billion in their pockets or have the Board sitting on that billion bucks with no clear purpose.
An extra billion dollars injected into the local North Carolina economy right now sure wouldn't hurt...the SECU Board appears not to get that!
'Why is the Board/CEO doing this?'
DeleteIf you did this at most financial organizations you'd be fired or kicked off the board or both!
These folks need to shown the door ... like YESTERDAY!
these folks have to manipulate the books to meet the goals set by these same folks? why not change the goals instead? sure makes them all look dishonest...Or idiotic. the question is:
ReplyDelete"Do they know what they are doing?"
1:41, how is it deceptive? the transaction is all over the financial statements. those are the real ratios as reported on call reports. don't hear them saying they are beating targets for other reasons.
ReplyDeletemaybe sleight of hand? trying to fool the members about how bad the ratios really are. (seems deceptive) Borrowing $5billion unneeded dollars (read JB's comments @4:41 and 6:25) to make the losses and increasing operation costs look better. The money obviously was not needed for safety and soundness. The Board and Leigh Brady clearly do not understand cooperative principles but do get and are attempting to operate according to banking practices. For profit.
DeleteBut not run as well as most NC Banks. Mediocre all the way around.
you can't serve two masters .... they are going to have to choose if they want to be a credit union or a bank ....
DeleteJB’s math is right on how the 5 billion affects the ratios, but how does reporting the official call report numbers become an attempt to deceive? How does 5 billion on the balance sheet hide loan losses? Convo should be why they are hoarding the extra billion in capital that sits there for all to see, not about how they are trying to manipulate the financials.
DeleteIf this is as grossly dishonest as you claim, why have you not attempted to file a lawsuit?
DeleteOh my! There are a lot of grossly dishonest things that are legal. SECU might even find a few more. Give them time!
DeleteHave you checked on the price of hiring a lawyer??? Where on earth is a credit union member going to get the massive dollars required to take these “leaders” to court? How long to you think that will take? How many years of your life are you willing to give to fight for what is right? Not to mention more money than you will ever have?
DeleteAnd oh by the way SECU now has a legal department and billions of dollars that TheBrady Bunch doesn’t mind spending. Hey! It’s not their money.
What planet do you live on?
Four in 24!
https://www.consumerfinance.gov/complaint/
Deletehttps://www.federalreserveconsumerhelp.gov/about/after-i-submit-a-complaint
https://cud.nc.gov/Consumers/File-a-Complaint
https://mycreditunion.gov/consumer-assistance-center/complaint-process
https://abc11.com/north-carolina-news-raleigh-durham-fayetteville/26170/
oh good! Looks like you have taken care of it!! thank you from the SECU members.
DeleteJean Blaine and Jim Blaine have been working on the North Carolina credit union commission and administrator for almost a year now. That doesn't seem to be going anywhere. There have been several posts on this blog about that.
What is available to the consumer or "people of modest means" is a lot of hogwash. Look at your list. How long do you think it would take to work through that?
If you are A++++++ paper wealthy, have some sense of social justice, and several years to spare and want to sue to get the SECU Board and Brady Bunch to "do the right thing" a whole lot of folks in this state would applaud. Go for it!!