Members of the State Employees’ Credit Union voted to re-elect four incumbent directors of the second-largest U.S. credit union.
The results were announced today at the $50 billion institution’s annual meeting in Greensboro.
In July, the SECU’s board’s nominating committee recommended four incumbent directors be re-elected. That prompted members to nominate four other candidates, who expressed disagreement with some SECU policies.
Online voting occurred in September, along with ballots cast at today’s gathering. Both sides made extensive use of social media to promote their candidacies, and the contested election attracted coverage in national credit union publications.
The incumbent candidates were: McKinley Wooten, an assistant secretary of the N.C. Department of Revenue; Bob Brinson, a retired state information technology employee; Mark Fleming, a retired vice president of government relations at Blue Cross Blue Shield of North Carolina; and Stelfanie Williams, a Duke University administrator.
The challengers were former SECU managers Susie Ford of Cary, Julian Hawes of Winston-Salem and Kirby Parrish of Johnston County, and Jean Blaine.
Jean Blaine is the wife of former SECU CEO Jim Blaine, who led the group from 1979 to 2015. Over the past two years, he has published a website critical of SECU’s board and leadership, emphasizing their decision to institute risk-based lending rates. The credit union had been among the few institutions nationally to charge the same rate on auto loans and other products, irrespective of a member’s credit rating or financial standing.
The four winning directors received from between 54,000 and 62,400 votes. The challengers received from about 22,000 to 32,000. SECU is a major force in North Carolina financial services with 2.8 million members, 275 offices in 100 counties and about 1,100 ATMs.
After the vote, SECU board Chair Mona Moon said she didn’t know what to expect from this year’s election after members last year ousted three incumbents favored by the board. But she said the results showed the candidates were respected by members, who believed the board was listening to their concerns.
Last year, members elected three new directors, Michael Clements, Barbara Perkins and Chuck Stone. The move stunned credit union officials nationally given SECU’s prominence and historic success.
Earlier this year, SECU reduced the number of tiers for loan rates from five to three, a response to criticism of the new policy. CEO Leigh Brady told attendees that the move showed the board’s respect for members.
Brady also said SECU is broadening its offerings while retaining its ethos as a not-for-profit, member-owned institution. It plans to offer its first rewards-based credit cards next year. One card will offer a rebate on spending for gas and restaurants, while another will offer a 1.5% cash rebate. It is holding off from small business lending, probably for three years, and has no desire to convert to a for-profit format, she said while answering questions submitted before the meeting. No questions from the floor were allowed at the event, which attracted more than 500 people.
“Many now view SECU as a commodity,” Brady said. “We want to position SECU as the best option to meet their financial needs while protecting their data.” She said that fintechs and cyberattacks represent the biggest threats to the credit union.
After the vote, Julian Hawes said he was disappointed that he and other challengers didn’t win the balloting. He said SECU shouldn’t be charging its least affluent customers higher rates. Too few members remember the credit union’s heritage of providing financial services to North Carolinians of modest means who weren’t welcomed at commercial banks, he added.
“As we’ve seen over the last several months, SECU members are awakening to the decline in service, non-competitive savings rates, rising operating costs, soaring loan losses, and the disenchantment of staff,” Jim Blaine said in an email Monday to supporters of the self-nominated candidates. “Hopefully 2025 will witness a turn for the better on all these issues; if not, you can be assured the 2025 election will unquestionably be a clean sweep.”
SECU reported a $209 million surplus in the fiscal year ending June 30. CEO Leigh Brady called the performance “strong” though “quite a bit lower than the $567 million” earned in the previous year, according to an Aug. 27 fiscal-year report.
SECU’s lower earnings stemmed largely from its decision to raise rates on money market accounts and certificates of deposits, which has benefited members with about $500 million in added payouts, Brady said Tuesday. The change followed declines in assets and deposits, marking a reversal from years of steady growth at the Raleigh-based institution.
Deposits have stabilized after SECU become more competitive in its rate offerings, Brady noted.
SECU also was hit by an increase in the provision for loan losses because of higher charge-offs and a new accounting rule that requires recognition of “estimated expected loss for the entire life of the portfolio,” the credit union said. Previously, the methodology involved one or two years of expected losses.
During the question-and-answer period, Brady said SECU charged off $23 million in the past fiscal year after 13,000 members defrauded SECU through a scheme involving Cash App, which allows people to pay bills digitally. Those members have been allowed to maintain basic accounts and can’t add other services until they repay the amount of fraudulent activity, she said.
