"Commenter : This information was helpful. I found the year-end
report without much trouble [re: 1/7/2025 post link], but I don’t know if I am reading it right."
"If you add the 30-60 late accounts with the 60+ late accounts, it’s
now over $2 billion dollars and the over 60 days late blew way past a
billion dollars in the last three months. The SECU website says 1.01% late
pay percentage but the report says 3.24%. I hope I am wrong, but what
in the world is happening?"
[link to NCUA data on SECU]
✅ Several ways to look at loan delinquency:
SECU loans past due 30 days+ : $ 2.048 billion
SECU loans past due 60 days+ : $ 1.147 billion
SECU loans past due 90 days+ : $ 740 million
The federal regulator usually tracks the 60 days+ figure as the official benchmark. SECU likes to show the 90 days+ ratio (the 1.01%) in its report to the SECU Board.
SECU's 60 day+ delinquency at December, 2023 was 2.25% of loans, at December, 2024 the 60 day+ delinquency was 3.24% of loans... (up 28% since September, 2024 alone!) up 44% over prior year-end.
😎 Net annual loan losses rose from $197 million in 2023 to $233 million in 2024... up 18%... while total loans grew annually by only 5.5%.
If the strategy is "making it up on volume"... tisn't working.
This is staggering and frightening. According to Callahan, the total 30+ DQ $ and Loan portfolios for the 3rd, 4th and 5th largest CU's as of Dec 24 are as follows:
ReplyDeletePenFed; $534 million, $25 billion in loans
SchoolsFirst: $315 million, $20 billion in loans
BECU: $153 million, $20 billion in loans
BECU is the low extreme, but SECU 13 times the DQ with a portfolio only 1.75 times larger. How?
The sum of BECU, PenFed and Schools First portfolios is about $65 billion, and the sum of their DQ is about $1 billion. SECU's DQ is double (100% larger!) than the sum of the 3rd, 4th and 5th largest CU's in the country, even though our loan portfolio of $35.3 billion is 30 billion lower than the sum of the other three.. Really hard to wrap your head around.
Something is really wrong here. Are we still struggling in collections?
Wait a minute, wait a minute!!! Seems like someone is trying to take over my job!!!
DeleteAs a non-anonymous critic, I can assure members that there is absolutely no concern about the safety and soundness of SECU - period, no if's, and's, or but's.
I do think it is clear that there has been a marked decline in financial performance, signs of a deterioration in the quality of service, and much more than normal dissatisfaction among the staff.
Could be wrong on service quality/unrest... but there is no denying the growing financial problems in SECU lending. Personally I don't believe in RBL, but this decline goes well beyond that... the underwriting of loans appears to be weak, administration and collection worse.
The SECU Board offers no explanation and appears to be asleep at the wheel. The cost to the membership - $233 million in loan losses in 2024 alone - is not theoretical nor a matter of opinion.
Looked a little more and it only gets worse.. Mr Blaine's table shows DQ to Net Worth and the combined DQ and C/off ratio. Here's how it compares:
ReplyDeleteSECU: 20.9 DQ / NW; 4.01% ratio
PenFed: 10.57 DQ / NW; 3.41% ratio
SchoolsFirst: 5.56 DQ / NW; 1.92% ratio
BECU: 2.25 DQ / NW; 1% ratio..
Our allowance for credit loss is 1.29% of loans even though DQ + Loss ratio is 4.01... PenFed's combined ratio is 3.41% but their allowance is 2.70% of assets.
Best one yet, both BECU and SECU have reserves at about 1.25% of assets, but SECU's DQ and loss ratio is 4 times larger than BECU's.. Are we reserved enough?
Could this be about impacted members and damaged homes and cars from the hurricane? It seems if they were given mods or deferrals they wouldn’t be reported as past due loans would they?
ReplyDelete6:59pm Look for any potential higher delinquency from WNC at end of January, 2025.- not Dec, 2024 reporting cycle.
DeleteThe delinquency benchmark is 60+ days( 2 monthly payments); Helene was Sept 28, so if I missed Nov 1 and Dec. 1. I won't be reported two months behhind until after January 1st.
But as commenter says... hopefully SECU extended the loans for members who got crushed... quite sure they did!
What about October. Extensions were given to those members who asked if they called in or responded to communication. Late fees were waived automatically without a need for authorization. A special loan was also created for members impacted by the storm.
DeleteHere is your largest cu list with charter #'s if you would like to muck around in the NCUA data:
ReplyDelete✅ Rank Credit Union
Total Assets Charter#
1
Navy Federal $178 billion 5536
2 State Employees’ $55.9 billion 66310
3 Pentagon Federal $34.4 billion 227
4 SchoolsFirst $30.6 billion 24212
5 Boeing Employees
$30.2 billion 62604
6 Golden 1 $20.5 billion 61650
7 America First $20.3 billion 24694
8 Alliant $20.1 billion 67955
9 Mountain America $19.3 billion 24692
10 Suncoast $18.2 billion 68645
✅ North Carolina Credit Unions
Name Charter #
SECU 66310
Truliant 7840
Coastal 18297
Local Government FCU 24003
Allegacy 24438
Self-Help 66258
Skyla 24808
Latino Community 68430
Marine FCU 12977
Fort Liberty 13690
Two factors here. 1. Questionable approval decisions and 2. Collections. Maybe it's different in other districts, but in mine, branch staff are extremely overworked. Collections are necessarily an afterthought - they simply don't have time in the day to make them a priority. They are not worked consistently. There has to be a different solution than putting it on the understaffed, overworked branch employees.
ReplyDeleteWhats missing is effective management and accountability. The collections department that was supposed take pressure off the branch could have and should have worked.
Delete@ 8:47 am You are right. Let's stop pretending and cut the crap. The failures lie with upper management's decisions. Failures are plenty, and the ELT continues to pretend that everything is going great. When confronted with obvious failures, they either deny, or even worse, point the finger elsewhere. Bad external hires, centralization, specialization, additional uneeded levels of upper management, rising delq, added policies and regulation, unneeded outsourcing, increased spending, decreased member service...the list goes on and on. No accountability at the upper management level. But if you ask any of them - things are going great! It's embarrassing they think they are either doing a good job, or outright denying what's actually happening at SECU. Many (RSVPs, EVPs, Chiefs) need to look in the mirror and realize they aren't cutting it. Too much is at stake.
DeleteWhat is interesting is that SECU has not loosened its underwriting standards over the past few years. SECU has generally loaned to many members that other financial institutions have not, they are just now going delinquent at an higher rate. In order to fix it at time of origination, credit underwriting would have to tighten more than it has been in the past. Early collections moved back to the branches a while ago.
ReplyDeleteRumor has it that collections up to 90 days are going back to the branches soon. Wonder if that will make it better?
Deleteguess this little hostile takeover isn't working out very well for these folks ... typical, can't build anything but are experts at tearing it down...
Deleteand blaming everyone and everything except themselves!