Are the SAFE Board and CEO fissilingual?
✅ Been looking at the question of: "Why has the leadership of SAFE voted to give away a thriving $4 billion local credit union to out-of-state interests (BECU)? - at an immeasurable loss to the Sacramento community and at a very measurable cost of over $400+ million to 245,000 SAFE member-owners.
✔ Does the SAFE Board and CEO know what they are doing? THEY SHOULD!!!
😎 Here's why. Take a look at these three excerpts from SAFE's most recent audited financials:
"SAFE CREDIT UNION
NOTES TO FINANCIAL STATEMENTS
December 31, 2025"
1) "NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES AND NATURE OF OPERATIONS:"
"Goodwill and Other Intangible Assets: Identifiable assets, liabilities, and contingent liabilities in entities acquired are measured at fair value at the date of acquisition. Identifiable intangible assets are recognized if they can be separated or arise from a contractual right and the fair value can be reliably measured. Any excess of the cost of business combination over the fair value of the acquired identifiable assets, liabilities,and contingent liabilities is recognized as goodwill. "
✔ Not to make you a CPA or anything like that, but the layman's translation is: if a credit union acquires any business - including another credit union - at a cost more (or less!) than fair value, then the difference in value is shown on the CUs books as "goodwill". [if you want to check out SAFE's complete financials - here's the link]
😎 So what happens if a credit union acquires another credit union at less than "fair value"? **
2) "NOTE 6 - GOODWILL AND OTHER INTANGIBLE ASSETS:"
The [SAFE!] Credit Union completed a merger transaction with American River HealthPro Credit Union that became effective on July 1, 2009. This merger was accounted for as a purchase business combination. As the purpose of this merger was to achieve growth and economies of scale among these mutual enterprises, no payment considerations were involved, contingent or otherwise. The goodwill of $13,282,000 associated with this merger..."
😎 So, you see SAFE CU has previously merged with another CU in 2009 and booked a goodwill gain of $13.2 million! The $13.2 million "shares" SAFE CU "acquired", "as a purchase" was the remaining member equity value of the old HealthPro CU. SAFE CU "purchased" HealthPro for $13.2 million less than its "fair value". To this day, that goodwill gain, that gift of $13.2 million still shows on SAFE's books!! [So, the SAFE Board knows how "this little game" works - or should!]
3) "NOTE 18 - PENDING MERGER (UNAUDITED):" [to be completed in 2027]
"Under the terms of the agreement, upon completion of the merger BECU will assume all assets, liabilities, and member shares of the [SAFE!] Credit Union. "
😎 If this mega-me merger between SAFE/BECU is permitted to occur, BECU will post a goodwill gain of somewhere between +$400 million to +$800 million from the purchase - having acquired SAFE CU from its member-owners as a gift - far, far below "fair value". [link]
How much does each SAFE member lose if the BECU merger occurs?
ReplyDelete4:51pm SAFE as a business is valued at between $400 million and $800 million. There are @ 245,000 members.
Deletehttps://www.secujustasking.com/2025/12/credit-unions-godfather-mergers-part-ix.html
If SAFE is given away by the Board, that would work out to a minimum average loss per member of @ $1,632 ($400 million/245,000 members).
This is not correct. There is no such thing as a “goodwill gain”. There is goodwill, which is an asset. Goodwill is created when the price is more than value. Then there is a gain, which occurs when the price is below the FMV. .
ReplyDelete6:47pm Troll twit-er! "Counting the number of angels on the head of a pin."
DeleteIn 2009, SAFE booked a new "goodwill" asset of $13.2 million after the acquisition of the HealthPro CU [its on page 4 of the audited financials].
It will always be worth $13.2 million, because HealthPro no longer exists.
In the "non-troll" real world, SAFE effectively received a $13.2 million "cash payment" for the business purchase of HealthPro. The "goodwill" giveaway figure for BECU will be over $400 million
Quote: "Goodwill is created when the price is more than value." Got it wrong... "goodwill" is created when a business is acquired at either above or below fair value.
But what fool would take less than fair value?
Perhaps you're smarter than SAFE's CPAs. If you think you are, might move away from the mirror and ask for a second opinion.
7:13pm Not disagreeing with the SAFE CPA’s. They are correct. The price /cost was higher than the market value by $13.2 million, so it became goodwill, which is an asset. Where you are 100% wrong is that goodwill isn’t created when the cost / price is below the FMV.
Delete9:06 pm See "pinhead" comment below.
DeleteQuote: "Not disagreeing with the SAFE CPA’s. They are correct."
No, you really can't disagree with professionals or folks would suspect you were a pinhead.
The CPAs certified that SAFE received a free, gift asset of $13.2 million!!
The same professional rules will apply on the giveaway of SAFE by tits Board and CEO.
Call it "Goodwill" or more appropriately call it "Breach of Fiduciary Duty"....
Either way SAFE members and Sacramento get screwed.
Dumbed down, cont’d: Now think about why there is no goodwill when the price is less than the fair market value (FMV).
DeleteWhen the price is less than FMV, you “profit” immediately.
That’s why you run it through the income statement and you’re allowed to record it as net income and it becomes capital.
10:09 pm "continued dumb down" - Amen!
DeleteQuote: "When the price is less than FMV, you “profit” immediately."
That's right SAFE profited immediately and that's what the $13.2 million in goodwill represents... a profit of $13.2 million by SAFE on the acquisition of HealthPro. Glad you get it
Quote: "...and you’re allowed to record it as net income and it becomes capital." Amen!
If this financial rape occurs, BECU will record an immediate profit of $400+ million at the expense of 245,000 individual SAFE members in the Sacramento community.
Shame on the SAFE CEO, shame on the SAFE Board! Willful malfeasance... an open and shut breach of fiduciary responsibility...
We’ll try this one more time:
DeletePrice > FMV = goodwill = asset, either amortized or impaired.
Price < FMV = gain (profit) = income statement = net income
The 13.2 isn’t profit or a gain you dumbass! It goodwill, which is an asset. Even you aren’t this stupid, but as always, better to edit, suppress and twist words than admit you’re wrong - even while knowingly misinforming readers. At least one of us has honesty and integrity.
10:31pm Well, seem to have struck a nerve there!
DeleteSorry to disrupt your fantasy-land musings.
Twit-rants aside, lets take a less amateurish look at those formulas and try to flush this stuff back under a rock.
Here goes. You claim:
1) "Price > FMV = goodwill = asset, either amortized or impaired."
[When a CU is acquired/merged at a cost more than its fair value, "goodwill" is created and booked as an "asset" by the acquiring CU.]
2) "Price < FMV = gain (profit) = income statement = net income."
[When a CU is acquired/merged at a cost less than fair value (the giveaway!), the acquiring CU earns a profit ($13.2 million) which is "net income" for the CU.
The good news is that you publicly acknowledge that when a CU is given away the acquiring CU earns a substantial profit!
In the case of SAFE/BECU your acknowledged profit will be $400+++ million.
But here's the correct, bottomline formula for that financial malfeasance:
3)"Price < FMV = gain (profit) = asset = goodwill"
[When a CU is acquired/merged at a cost less than fair value a profit is earned ($13.2 million) and is recorded as an "asset" called "goodwill' on the books of the acquiring CU (SAFE).
But don't take my word for it. SAFE's CPAs (Crowe LLC) have reported that transaction like this on the audited financials in each of the last 16 years:
"Goodwill : 2024 $13,282,000 2025 $13,282,000"
[link - https://www.safecu.org/docs/default-source/about-safe/2025-safe-cu-financials.pdf]
Take it you claim that Crowe LLC - CPAs are incompetent and have permitted SAFE CU to publish inaccurate financial statements?
Or does the problem lie somewhere else
TWIT ALERT! The follow-up twit-rant response was way beyond la-la, but here are a few quoteables that will confirm a raging fantasia syndrome - or "...claims I never made" sayeth the twit:
DeleteTA: "8:39.. you have a chronic misunderstanding of how it works . And, since the only way you can win an argument is to try to counter claims I never made, let’s clear it up:"
"1) nowhere did I claim in #.2 that the credit union makes a bargain purchase gain"
>> Look above, here's what our twit stated:
"2) "Price < FMV = gain (profit) = income statement = net income."
>> Sure looks like our twit claimed the giveaway resulted in a: "...= gain (profit)"=...
TA: "As to your #3, you are still completely wrong or unwilling to acknowledge the difference between a gain and goodwill. There exist two accounting treatments when the is different than the FMV. Goodwill or a gain. The former is an asset, the latter is income. "
>> Look above, here's what was stated:
"3)"Price < FMV = gain (profit) = asset = goodwill"
>> Our twit is hoisted by his own bizarre petard. #3 represents the full accounting reality of a CU giveaway transaction.
Our twit-acknowledged "= gain(profit)" is an "asset" of the SAFE CU (as is all "net income") and that "asset" ($13.2 million) is booked as "goodwill" on SAFE's balance sheet by their CPAs. And, was booked as such - "goodwill" in 2009 and every subsequent year, including 2025.
TA: Or twit goes on to say in the rant response:
"The 13.2 is not a gain and a gain does not become goodwill."
>> The CPAs for SAFE beg to differ... the gain is goodwill - period.
TA: the twit posted the following in the 10:31pm comment above:
"The 13.2 isn’t profit or a gain you dumbass! It goodwill, which is an asset."
>> Say what? Is the $13.2 million a gain or not? At least our twit confirms that it is an asset and is goodwill!
If your confused by our twit's incontinent thinking, you're not alone!
Under any circumstance, those professional CPAs at Crowe LLC keep reporting that $13.2 million twit-certified "..gain(profit)" as an "asset" called "goodwill". Who ya gonna believe?
Time to crawl back under... amateur hour is over.
So no, the twit does not admit a gain is goodwill.
Delete1:50pm Ok, then explain to all of us what happened on July 1, 2009 when SAFE CU merged with American HealthPro.
DeleteWhat was the $13.2 million which appeared on the SAFE balance sheet as an asset called goodwill after the merger?
Answered this multiple times, and the answer is in your question. The 13.2 million was an asset called goodwill, because the “price” was greater than the FMV. Read Crowe’s full comment about the costs / price over FMV. It’s all there. It was NOT a gain, and it was NOT recorded as net income. Hint: as your read Crowe’s,
Deletecomments there is no language that comes even close to suggesting it was. I don’t have simpler words to describe especially if you are unable or unwilling to comprehend this. Sorry.
7:13 pm Sorry, in case the "pinhead" allusion didn't make sense.
ReplyDelete"How many angels can dance on the head of a pin?" is a famous metaphor for pointless debates over trivial issues.
A total waste of time to discuss the value of the CPA Opinion. The Opinion is like all opinions and they are like butts! They stink! The members are getting screwed! Period! Not opinion! Fact! B
ReplyDeletePlease back up your facts with actual facts.
DeleteAnother Inside Job!
ReplyDeletehttps://www.youtube.com/watch?v=T2IaJwkqgPk
it's going to get worse... hold on tight and keep the faith ...
DeleteIn the interest of not having misinformation and bad facts spread to our members and stakeholders, I'm adding some resources for you. You don't believe me, all good. I think you believe the NCUA, and hopefully a few accounting firms, who have liability if they don't understand or misapply rules.
ReplyDeleteYour explicit claim, from the 8:39 post:
3)"Price < FMV = gain (profit) = asset = goodwill"
[When a CU is acquired/merged at a cost less than fair value a profit is earned ($13.2 million) and is recorded as an "asset" called "goodwill' on the books of the acquiring CU (SAFE).
The implicit meaning of your claim:
That a gain and goodwill are the same thing, and the accounting treatment is the same whether or not the price is above or below the FMV.
The bad facts and faulty assumptions
1) that when the price is < FV, goodwill is generated.
2) that goodwill is some kind of "profit" for the acquiring credit union
3) that a gain and goodwill are the same thing (which is a real head-scratcher)
Use these resources to enhance your understanding.
Conclusion: Your claim as stated is 100% wrong. No serious, competent or honest person could reasonably conclude anything different from the material shown. I would add, it's quite consistent with Crowe's language. In CU mergers, there is either a gain, goodwill, or neither. Most often goodwill. It can only be one of those three things. SAFE recorded goodwill, not a gain, but we've covered that.
Once you read all this, feel free to walk it back with readers that you've misinformed them. You're welcome. I should charge you for my time, but let's consider it a public service.
https://wilwinn.com/wp-content/uploads/Credit-Union-Purchase-Accounting-w-appendices_04.04.23.pdf
https://ncua.gov/regulation-supervision/letters-credit-unions-other-guidance/interagency-supervisory-guidance-bargain-purchases-and-fdic-and-ncua-assisted/bargain-purchases-interagency-guidance
https://viewpoint.pwc.com/dt/us/en/pwc/accounting_guides/business_combination/business_combination__28_US/chapter_2_acquisitio_US/26_recognizing_and_m_US.html#pwc-topic.dita_1323041404211241
I'm all in one this topic. Your're readers will probably never know, but you're wrong, I am right. Eat it, own it, accept it. Not even close to being the first time.
Mr. Blaine, I have a question? Is there a market for the sale of Goodwill? Who would buy it? Yet it gets booked as an asset. Are the people who buy goodwill interested in buying a bridge? Goodwill is just a number required balance the left and right side of the balance sheet with a number that nobody can quantify. We used to call numbers like this a plug! B
ReplyDelete6:11. No, there is no market for goodwill. It’s an intangible asset. It’s a recorded accounting amount specific to a transaction. A common form of goodwill is CDI, or core deposit intangible, from the deposit base of the acquired CU. Goodwill is the intangible value of that so it’s worth nothing to anyone other entity or cu (the deposits themselves might be, of course).
Delete*10:08PM Last week it was member equity, this week its goodwill. Next week he'll find some other term to get his sheep up in arms over.
Delete2:05. lol! Do you mean find a new term or just make one up?
DeleteWhat you have failed to explain is why I should care.
ReplyDeleteYou shouldn’t. Pretty arrogant to believe you know what’s best for another credit union’s members.
Delete