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Having just read Suncoast Schools FCU CEO Tom Dorety’s letter to the editor in the Feb. 3 issue, it makes one wonder how did the likes of Navy FCU and Pentagon FCU manage to grow capital? It seems both did it the old-fashioned way, through retained earnings. Now, one would think with assets north of $5 billion Suncoast Schools has reached an economy of scale. You would be wrong.

As CEO of Suncoast, Dorety has not shown a profit since 2007. During 2009 SunCoast has lost over $483 Million in assets. In 2009, SunCoast lost over $77 million in income, and it has lost over $84 million in capital. With a net worth ratio of a mere 6.04%, it is in a hard way. Dorety’s answer to his plight is to beg permission from the NCUA to raise alternative capital. The real answer is to adjust the Suncoast business model and reduce operating expenses.

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Peter Westerman

 

Credit Union Times

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