... anyone disagree on that?
Why keep harping on and on about risk-based lending at SECU? Because risk-based lending is failing and the costs to members of this error in judgment by the Board of Directors are escalating rapidly.
That it is possible for SECU's Legacy Board to err should not be in dispute. The Board kicked off its losing streak with a remarkable CEO mis-hire in 2021. No argument there! That CEO, eighteen months later, abruptly disappeared without notice nor explanation; although a "$6.2 million" related liability remains on SECU books to be satisfied.
A 40-year working partnership with Local Government FCU evaporated in the face of a "no formal proposal-proposal" Board merger threat. Board-centric ambitions for "regional expansion", "anyone can join", and "commercial banking" have fueled distrust by a skeptical Legislature and opposition by the banking industry. An 85-year consecutive record of growth has ended and savings rates are no longer among the best in the market. Operating costs have soared.
The SECU membership loudly signaled its displeasure with these misadventures by booting out all Board incumbents at the 2023 Annual Meeting. But, the Legacy Board does not like to listen and persists with its destructive pursuit of cascading calamities.
How do you know risk-based lending is failing? Even if you are not yet convinced that risk-based lending discriminates against the majority of SECU members - especially those who are young, black, female and of modest means - there can be no argument about the actual, severely adverse financial results. Loan losses at SECU have [link] jumped from $70 million in 2021 to $196 million in 2023 with more bad news dead ahead. Loan delinquency - well below "industry standards" in the past - is now 3 times higher [link] than other credit unions of similar size in 2024. Those are facts - indisputable!
Risk-based lending is now costing SECU members - that means you - literally hundreds of millions of dollars annually in excess interest costs, higher operational costs, and loan losses. That's why the Board is desperately scrambling with "new RBL enhancements" - trying to lipstick the porker!
But what is really going to destroy the reputation of SECU is when you find out that the Legacy Board believes all this is your fault! Moi?
That's right, you're the problem!
... stay tuned to learn how you have erred!
