Mike Lord
Credit Score rate setting for loans is terrible and hurts thousands
of members every day. Have denounced this practice many times.
However, today I would like to comment on several other issues that
call into question SECU Board and management actions over the past
fiscal year.
❋ The SECU CEO enthusiastically wrote the following in her recent emailed letter to members:
[The full text of the email to all SECU members dated 8/27/2024 can be found here [link] on the SECU website].
She
conveniently left out of her message that due to mistakes by the Board
and Management there would have been much more money available to pay
out to members in the form of higher deposit rates.
If they had:
1).
Not borrowed $5 billion from the Federal Reserve Bank at a cost of $169
million in interest. Had they instead just raised deposit interest
rates higher and faster they would have retained the $5 billion in
deposits that ran out the door to other institutions. $169 million
could and should have been paid out to members in higher deposit
interest rates! SECU would have retained the deposits and our members
would have benefited from the higher rates; instead the Federal Reserve
Bank benefited!
2). Collected rather than
charged off $250 million in loan losses because they centralized past
due loan payment collections into one Call Center which was an utter
failure. SECU loan losses should have been $100 million and likely
would have been if they had let the 275 branches collect the loans from
their local members as the practice had been for decades. That’s an
additional $150 million that could have been paid out to members in the
form of higher deposit rates.
3). Not had to
realize a loss of $43 million on sales of Investments to provide
liquidity to make loans and pay out the $5 billion in deposit
withdrawals that should never had happened in the first place. That’s
$43 million more!
That’s a total of $362
million ($169+$150+$43 = $362 million) that should have/could have been
paid out to members in higher deposit rates in 2024 but wasn’t!
These
are major operational blunders by management and the Board which our
members are paying for in the form of higher loan interest rates and
lower deposit interest rates.
SECU members deserve better! They should be demanding better!
A lot to be disgruntled about! End of musings!
—Mike Lord
Past SECU CEO, CFO and 46 Year Employee
Something doesn't smell right...
