SECU: Monitoring The Performance Of Your Credit Union - The Impact Of Federal Deposit Insurance.

    

The National Credit Union Administration

It apparently came as a surprise to many of you that SECU was created in 1937 as an employer sponsored benefit - like most other credit unions. A mutual investment/borrowing "club" to give North Carolina state and public school employees access to consumer credit. As we have seen, it really wasn't a true financial institution, definitely not a commercial bank. Credit unions were something different in the world of finance - different structure, different goals, different purpose.

SECU as an "employee investment/borrowing club" quickly evolved into a "family thing"; as it became difficult to justify forcing retirees or widows and children of members out of the membership. All members continued to have equal rights and the ideas of "once a  member, always a member" and family memberships set the stage for growth. 

Lending rates were low, decisions quick; savings rates were highly competitive. Dealing locally with folks who knew you and high quality ("we know you by name"!) service also fueled the fire. SECU treated you fairly and with respect - as an equal. You were, after all, among friends, family and coworkers. SECU "had your back" financially, that's why they were there. 

Remember that the only money SECU had to lend came from the savings dollars of other members! If something "went wrong" at SECU, losses were deducted from your savings balance. All members shared equally in operating and lending losses. Your savings (share) deposits were uninsured at SECU! As a member, you were directly at risk of loss. You stood the chance of losing your life savings! Members paid close attention to their credit union - with good reason

Then along came deposit insurance via the federal government... and things began to change...

  NCUA, the feds arrive... a change for the better?

 

 

 

 

 

  

SECU: The Sole Purpose of A Credit Union Should Be To Help Members "Thrive"

  ... to your credit union.

Sometimes it helps to pause and foreshadow where we are heading with all this - don't want you to feel like you're wasting your time. Patience, there may be a "pot of gold' for you at the end of this saga...

In 2021 the SECU Board unilaterally launched a "new direction, new culture" [the "new/new"] at SECU, including an improbable CEO hire, plus goals of geographic/member eligibility expansion, commercial lending, and a strong for-profit focus. The SECU staff was the first to raise the alarm. As a result, the last three SECU annual meetings have been a pitched battle for definition and clarification of the future envisioned by the SECU Board for our credit union. Despite the furor, that vision remains unclear. 

If you look beyond North Carolina, you will find that many of the larger credit unions are pursuing that same "new/new" culture and direction through merger and commercialization. The "new/new" may have become the "industry standard", with which our SECU Board seems so infatuated.

We want to keep exploring whether the SECU "new/new" is the best way forward for you as a member - perhaps it is! But if it is - through merger/commercialization, you as a member/shareholder should expect a substantial payout of your ownership interest. Remember that little $16,000 family of four figure from the last post [link]? SECU as a company is worth between $5 to $10 billion [yes that's right - "billions"]

Part of those billions of dollars belongs to you - so pay attention! Protect your interests. 

Want a real life, happening right now example of how a "payout to members" works when a large credit union goes "new/new"? Here take a look [link].

... heck, just send me a check for Xmas! I can join another CU with better rates...