What’s with the Statue?

The Seated Boxer, an iconic ancient Greek work of art, shows a grizzled veteran of the ring, equal parts resigned and ready to spring into action. 

What I like is a sense of respite from competition, the powerful athletic physique and the tiredness that surrounds his humanity.  Is he a winner this day? Are there more fights to go?  How will his efforts be remembered?

These are questions that all of us encounter, in literal or figurative ways, in our daily efforts. 

Continue reading “What’s with the Statue?”

 Wisdom from the Field

When you label your peers competition and fear them as such you are on the road to simply going it alone.

My confidence comes from the fact that traditionally “competition” is defined by two players racing in the same race.

I have no competition.  For the race I am running is my own- my communities – our own reward.

 

 

 A Covid Test & The Paradox of  Bureaucracy

To ensure a safe Thanksgiving, my wife and I lined up Friday night for our Covid tests at the county recreation center. The test was free. The line took about an hour. Everyone stood six feet apart as the temperature got cooler as night came.

We were given clipboards to complete our registration—name, email, age, race. One of the staff helping with sign ins came by to ask the obligatory questions. Have you had any Covid symptoms? Been around anyone who has tested positive?

It was the last question that was memorable, however. She qualified it by saying “I think I know the answer, but I have to ask anyway. Are you pregnant?”

An NCUA Exam Risk Rating

The predictable routine of bureaucracy is an important factor in performance. We rely on formulaic responses especially by those in authority. But it can also result in actions that contradict common sense.

In a conversation with a CEO about how to respond to his most recent exam, this same anomaly was present.

The credit union has been a CAMEL 1 for almost two decades. It has navigated the pandemic with improving performance. Liquidity is 500% the policy minimum, delinquency is down and most loans in forbearance are back making payments. ROA and net worth are way above peer averages. A consistent track record of exceptional performance in the present and the past, through thick and thin.

So, I asked given these documented facts why the risk rating for “credit” and “liquidity” were judged “moderate” versus the “low” ranking on every other factor. The CEO’s observation was “It feels like we are being punished for what could happen in the future.”

The Culture of Bureaucracy

This is the difficulty with bureaucratic culture. When facts don’t fit a program’s priorities, the instinct is to assert future scenarios that do. This tendency is not limited to examiners. Listening to last week’s NCUA board meeting, two members confidently predicted the future financial downturn of credit unions in 2021 and with it, the necessity of collecting more money for the NCUSIF. This was after the staff updated the distribution of CAMEL ratings that showed the continuing reduction in code 4 and 5 classifications in both total assets and number of credit unions.

Facts will not deter the inevitable government instinct to always seek more money. This prediction of future NCUSIF premiums reflects a bureaucratic mindset similar to asking all males if they are pregnant.

After getting our Covid tests, we walked out by the admin line and everyone wished me a safe pregnancy. For I had answered yes to the question. We all enjoyed the humor of this bureaucratic incongruity.

Common sense, humor and a negative test. Good ingredients for a safe 2020 Thanksgiving. For it is my hunch that 2021 could be the best year credit unions and their members have ever enjoyed.

Credit Unions Investing in Other Cooperatives

Responding to the listing of America’s top 100 cooperatives by total revenue, I received the following comment from Leo Sammallahti, marketing manager for the Coop Exchange:

“Credit unions do fantastic charitable work, but do we just try to do the type of charitable work that conventional banks do, but just more and better? How about we take a different, distinct approach. Let’s help our members help themselves by fostering creation of new cooperatives. Isn’t that what Filene was all about? If the 120 million member strong credit unions are not doing this, who is? We could find great ideas and energy among those members if we look for it.”

A Case Study of a Credit Union Investing in Coops

Leo then sent me this example:

“Matthew Cropp from the Vermont Employee Ownership Center recently rediscovered a little-known credit union statute applicable to state-chartered credit unions in eight states (Arkansas, Illinois, Kentucky, Montana, Nevada, New Jersey, New Mexico and Vermont). It allows credit unions to make equity investments into cooperatives, including worker cooperatives.

As a result of this discovery, one of the largest credit unions in Vermont (VSECU) has begun to offer equity to cooperatives in its region—an unprecedented move as most credit unions, if they offer any financing for coops, offer debt financing.

The Vermont statue’s language specifies that state-chartered credit unions are authorized to invest equity of up to 10% of the shares, deposits, and surplus of the credit union into cooperatives. These investments would not count against the 12.25% member business lending cap that most credit unions are currently subject to.

VSECU has decided to make 10% of their total equity available for equity investment in coops, roughly equal to $8.5M in 2020. It appears that the VSECU is the only credit union in any of these eight states that has started investing using this statute. Its co-op capital tool kit can be found at this link https://www.vsecu.com/community/resources/co-op-capital

Consequentially, cooperative advocates are working to identify credit unions in the other eight states to follow VSECU’s lead and invest equity capital in coops. There is also talk of lobbying other state’s legislatures, then eventually congress to “follow suit by broadening the range of credit unions that are legally permitted to make such investments.”

Are there other instances of this coop investment effort readers can share?

Chairman Hood’s House Testimony: Members’ Interest Only Matters When Selling to a Bank

In today’s cooperative system when a bank acquires a credit union, regulators require that a fully detailed, independently verified value be given members for the equity accumulated from their loyalty. There is no such protection for members in a credit union acquisition.

Chairman Rodney Hood’s House Banking Committee testimony on Thursday, November 12, 2020, included a summary of credit union bank purchases and credit union mergers. The import of his logic is devastating.

As outlined by Hood in his “state of the industry” presentation, the only way the agency will ensure members receive fair value for their equity is to be bought by a bank. The necessary action is self-evident: before any credit union board or CEO decides to end their charter and hand off their members’ future via a merger, contact a bank to determine what they think the credit union is worth. Otherwise, don’t count on NCUA ensuring members receive a fair deal.

The Chairman’s words

Bank acquisitions by credit unions were described as follows:

“. . .the number of credit unions purchasing banks is very small. Of the 36 NCUA-approved bank purchases by federally insured credit unions since 2012, 13 were banks with assets less than $100 million. Another 16 of the transactions involved banks with assets from $100 million to $250 million. Only seven of the approved transactions were banks with assets above $250 million.”

And these, he explained, are thoroughly regulated:

“The NCUA does not prohibit the transactions because credit unions are permitted by regulation to purchase banks. Additionally, bank-to-credit union transactions must also be approved by the Federal Deposit Insurance Corporation, per the Bank Merger Act, and the state credit union regulatory agency, for transactions involving a state-chartered credit union.”

In the reverse situation, where a bank acquires a credit union, it is carefully monitored to protect members’ interests:

“The NCUA has regulations to oversee the sale of a credit union to a bank. These regulations ensure the members’ equity is properly valued by an independent third party who establishes a market valuation of the credit union. The purchasing bank must pay the credit union at least that amount thereby ensuring the selling members are paid a fair value for their equity.” [emphasis added]

No Fair Value for Members in a Merger Acquisition

When one credit union acquires another through a merger, there is no such member protection. These acquisitions are merely a response to changing market conditions:

“. . .The majority of merging credit unions are comprised of smaller credit unions, and the most common reason for merging is to expand services, as larger credit unions tend to offer more complex products and services to their members. However, we have seen a growing number of larger credit unions use mergers and acquisitions as strategies to grow and increase market share.

Due to the pandemic, merger activity for federally insured credit unions has slowed, but may increase as conditions evolve. The NCUA will monitor these trends to ensure the continued consolidation of credit unions and system assets does not create new potential risks to the Share Insurance Fund.”

Members Short-Changed

NCUA’s monitoring of these intra-industry merger acquisitions does not include “ensuring members are paid a fair value for their equity.”

Wouldn’t credit union members be financially better served if their institution was sold to a bank for “fair value”? Then take their money and their savings to another credit union if they so choose? Or even purchase equity shares in the bank acquirer?

Mergers between credit unions are not “market-based transactions.” There is no transparency in the process. Those responsible negotiate their own self-interest behind closed doors. The opportunity for alternative “bidders” is not presented. No specific or meaningful benefits for members are detailed. Member voting is not a choice, but merely a request to ratify decisions that have already been made without their input.

A Weakening of the System

The first rule of safety and soundness is diversification, not putting all eggs in one basket. Concentration destroys diversification. The single strategy of the surviving firm replaces multiple ways of approaching the future.

While NCUA claims to monitor merger activity to verify that the continued consolidation of credit unions and system assets does not create new potential risks to the Share Insurance Fund, how it does so is a complete mystery. Even if the erosion of the industry’s soundness could be documented, what would the remedy be? Undo multiple mergers? Not practical. Stop mergers? Not realistic.

The three traditional solutions for a problem are to find a bigger healthy merger partner, liquidate, or sell to third party outsiders. Unless a more open, transparent, member-first merger process is created soon, future credit unions will reap the whirlwind of this growing short-term practice undermining system soundness.

Mergers and Growth: A Common Myth

The merging of sound, independently managed firms debases cooperative design, undermines member well-being and destroys credit unions’ reputation as the trusted alternative to market-driven financial options.

It also perpetuates the myth that somehow mergers enable growth and stronger competitive capabilities versus self-driven organic strategies. An analysis of credit unions with high profile merger efforts suggests just the opposite. This will be the focus of a later blog.

Bigger does not automatically create better value. Credit union mergers do not enlarge cooperative market presence. That requires innovative, purposed-based continuous management effort, a skill that atrophies when mergers become front and center.

A Ruinous Policy

The assumption in NCUA’s oversight of credit union acquisitions that credit union mergers are benign, whereas a bank purchase is predatory, is completely false. Multiple current examples contradict this belief.

The irony in Hood and NCUA’s differential regulatory approach to purchase acquisitions is disastrous. It requires a bank offer to activate NCUA oversight for credit union members to receive fair value. Only a bank bid brings real transparency to the insider’s merger games now being practiced. In either outcome, the members lose their credit union.

Students: Enrolling the Next Generation of Members

In 1974, Peggy Holliday, CEO of Burbank Schools FCU, started student run branches at two Burbank High Schools. Each campus had a Student Credit Union Treasurer, who would “work” the student credit union during lunch, opening accounts and performing basic deposit/withdrawal transactions.

After school, the Student Treasurer would come to Burbank Schools FCU and reconcile the deposits/withdrawals of the day and process the membership forms to open the accounts.

The experience taught students the real-life skills of money management, budgeting, balancing cash drawers, and basic financial transactions. Students learned the concept of compound interest and making loan payments. Some went on to build careers in the credit union industry.

In 2011, the student credit union branches were disbanded. As account access became available online, the need for in-person transactions diminished. Promoting loan products became challenging, due to regulations. Checking accounts required parental authorization, difficult during school hours. Additionally, as school security increased, hallways became locked down during lunch, and access to the dedicated student credit union room became an issue. Finding student volunteers also became challenging.

But the focus on offering great service to students continued with UMe Credit Union (formerly named Burbank Schools FCU). UMe has an ATM on the quad at Burroughs High School, offers scholarships to Burbank grads, provides a student intern program and offers financial workshops and “Bite of Reality” financial simulation experiences. Additionally, UMe has some student-centric savings products created to help the younger generation get a head start on saving money.

Growing loyal student members by helping teach smart money management is a continued business effort for UMe. They think of themselves more as “helpers” than bankers, which is why they believe in promoting the cooperative spirit to their next generation of members.

From High Schools to Universities

Credit unions, especially those with educational FOMs, continue to sponsor student run credit unions or branches in high schools throughout the country. Students gained financial skills and become part of a new generation of co-op members.

In 1982 to address a falloff in the number of new federal charters (only 114 in 1982), the NCUA launched a renewal program called Credit Union Expansion or CUE-84. The goal was to make credit unions available to many new members ahead of the 50th anniversary of the Federal Credit Union Act in 1984, The committee’s members were a who’s who of credit union CEOs, league and trade association leaders, and state regulators. The one surviving attendee of the 1934 founding of CUNA at Estes Park Colorado, Louise Herring, was on the committee along with Joe Scoggins, CEO of Navy Federal, the country’s largest credit union.

The three-pronged growth effort included chartering new credit unions, expanding FOMs and adding groups such as retirees to credit unions.

The College-University Initiative: Solving a Real National Problem

One important focus was organizing new charters at universities around the country. One example profiled by NCUA was New York University FCU for faculty, all university employees, trustees, alumni and students. Potential membership was 20,000.

The local poster child for this effort was Georgetown University Alumni and Students FCU (GUASFCU) in Washington D.C. Sponsored by the student government, it was open to students and alumni and managed by undergraduates who wanted the experience of running their own co-op.

NCUA changed policy to designate student credit unions as low income, enabling them to accept non-member deposits to fund low cost loans for books and tuition. As explained by NCUA Chairman Callahan:

“This opens the door to alumni through the corporations they work for to make contributions in the form of federally insured deposits which can be earmarked for student loans. Here is a vehicle that could provide a private enterprise approach to something that is a real national problem-the need for student loan funds.”

Of the 107 new charters approved in 1983, NCUA’s Annual Report included a picture of the GUASFCU’s first annual meeting. Also highlighted were charters for the University Student FCU (University of Chicago) and Skidmore Students FCU in Saratoga Springs, NY.

Recently GUASFCU’s Hoya Banking model with $17 million in assets announced a grant from the University to underwrite a secured loan for all incoming students so each could establish a credit score of 685 or greater by graduation.

Current Chartering Environment

From military recruiters, to political parties to businesses seeking the loyalty of new consumers for their products, high school and colleges are target markets for every institution that wants to remain relevant in society. Most major college campuses now have a bank branch on the grounds, or nearby, to serve students.

Gen Z and millennials embrace activism, engagement and technology to create new ways of participating in economic and social change. Starting new enterprises is one hallmark of this creative impulse.

Responding to this student interest, over 220 colleges and universities across the country provide innovation and entrepreneurship programs to encourage this activity. (https://www.acceleratorinfo.com/see-all.html)

These academic business accelerators respond to students wanting change, promote the traditional American spirit of innovation and, if successful, provide a financial return to the school. Many academic institutions now sponsor “shark tank” contests to incent new venture ideas offering dollars as well as in-kind support for winners.

One winner in the spring 2018 George Washington University’s new venture competition was a group of freshmen. They proposed a student managed credit union for their university community. They had three primary goals: provide better value services for the students; offer practical management opportunities for volunteer leaders; and create a prototype that could be easily replicated at other colleges around the country.

These students are business, finance, technical and liberal arts majors. They are volunteers in this multi-year effort receiving no pay or course credit. Now in their fourth year of trying to obtain a charter, they may earn their bachelor’s degree before NCUA approves their application.

The Problem for Credit Unions

If students are not part of credit unions’ recruiting efforts, the industry is losing the battle for the next generation of leaders and members. Unlike many areas of civic endeavor or business enterprise, cooperative solutions are best understood when experienced first-hand. They are not a dominant form of organizational design in America’s capitalist economy.

Earlier NCUA efforts, recognized the need to encourage the use and formation of credit unions for all groups. Especially students. Now less so. But the needs of Americans in 2020 and forward are not that much different from 1980.

A Cooperative Opportunity: HBCUs and NCUA

Chairman Hood has announced his ACCESS initiative (https://www.ncua.gov/access) to promote financial inclusion. To put real work, not just talk behind this concept, NCUA should reinvigorate the student credit union charter effort.

For example, there are 107 historically black colleges and universities (HBCUs) in the country. Fifty-six are private and fifty-one public. The democratic Vice-Presidential candidate is a graduate of Howard University whose credit union has charter # 648 (1935) but apparently does not include students.

Can here be a program with local credit union mentors (the Burbank Schools model) to launch credit unions at HBCUs around the country? It would bring a new generation into the cooperative experience as members and managers. Successful examples like GUSAFCU are operating. The benefits are known.

There is nothing more inclusive than the empowering persons through self-help. That is how all credit unions began.

The need is leaders willing to move forward. The ball lies in NCUA’s court. No one wants to wait four years to receive a license to start an enterprise. Especially a cooperative where community progress, not individual enrichment, is the motivation.

If NCUA were to initiate such an effort it would stop working its way out of business and start seeding the economy with a new generation of cooperators. It would also:

  • Turn the industry to a new vision for itself.
  • Extend the NCUAs role in the expansion and success of cooperative solutions.
  • Point credit unions to new heights for mutual benefit, versus consolidation.

All Credit Unions Start “Small” but with Large Visions

Can you name the credit union whose initial name is shown in the image below?

Two hints: It is state chartered, as you can tell by the name. And it was formed during the Depression by 18 employees who each contributed 50 cents for total capital of $9.

The answer will be a blog posted on the anniversary of the credit union’s charter later this year.

The names of all who submit the correct answer will be recognized as “cooperative historical scholars.”

A Once-a-Decade Opportunity

This week there were two different, but distinctly connected public presentations.

The first was Callahan’s quarterly Trend Watch call which analyzed September 30 data for the credit union system. One takeaway from the slides http://bit.ly/3Q-2020) is the ongoing rise of credit union liquidity to $552 billion, a 45% increase over the past 12 months. This was driven by the historically high 18% pandemic-induced annual share growth. Most of this new liquidity is in cash and short-term investments. Credit unions are awash in liquidity.

Across town NCUA Chair Hood submitted Congressional testimony to the Senate Banking Committee.

His statement included a Central Liquidity Facility (CLF) update. He reported that the number of natural person regular CLF members was 340, up from 283 members in April when the CARES Act changes were passed. All eleven corporate credit unions became agent members in May. As a result 4,145 credit unions, or 80 percent of all federally insured credit unions, now have access to the CLF.

These new members increased subscribed capital stock to $989.8 million. The facility’s borrowing authority increased to $32.2 billion from $21.7 billion as a result of the Cares Act changes.

In his statement he had one legislative request. It was that the statutory changes providing the CLF greater flexibility from CARES Act be “extended for the length of the pandemic.” These four changes were the increase in the borrowing multiple from 12 to 16 times capital, relaxed agent membership requirements, a broader definition of liquidity needs, and greater discretion in lending authority.

What Was Left Out of Hood’s Testimony

What Hood did not mention was that there has been zero demand for CLF loans. The co-op system has record amounts of liquidity. Also credit union asset quality has remained stable with readily available market values, unlike the situation in the 2009/2010 Great Recession.

Even though 80% of credit unions may be members, the amount of subscribed capital stock (1/4 of 1%), suggests that they represent only 25% of the industry’s $1.547 trillion total shares as of September 30. In other words, most of the largest credit unions with three quarters of the movement’s total assets have chosen not to join.

What are the reasons the largest credit unions see the CLF as irrelevant? If there is zero loan demand now, and the most probable scenario going forward, why extend temporary “reforms” that have no practical purpose? Why should $1 billion of credit union funds be tied up in an NCUA-managed entity that is not providing value for credit unions?

The CLF’s Future: A Time for Transformation

The CLF enabling legislation was passed in 1977 when credit unions were outside the established financial system. They had no access to the Federal Reserve clearing system nor could they join the FHLB’s. The CLF was intended to be the third leg of the regulatory structure for an independent cooperative financial system when added to NCUA’s chartering/supervision and insurance responsibilities.

Since founding, the primary use of the CLF is to fund NCUA’s insurance regulatory needs, not credit union liquidity. In the aftermath of the corporate crisis and the liquidation of US Central, the partnership which covered 100% of the industry was ended and nothing replaced it.

The current “temporary” CARES Act changes are merely a deformed offspring of a partnership effort which NCUA terminated.

With the availability of FHLB funding and access to the Fed, the question is: does the credit union system need the CLF?

Hood described the CLF’s role in his Senate statement:

“The CLF is a mixed-ownership government corporation that provides the credit union system with a contingent source of funds to assist credit unions experiencing unusual or unexpected liquidity shortfalls during individual or system-wide liquidity events. The CLF also serves as an additional liquidity source for the Share Insurance Fund, which helps to ensure the credit union system and the fund remain strong. Member credit unions own the CLF, which is managed by the NCUA. Joining the facility is voluntary.”

How might this public-private voluntary partnership become more relevant for its owners and credit union members? What would real reform look like?

The Rare Opportunity for National Credit Union Legislation

Historically, significant federal credit union legislation happens only once per decade. The CLF/NCUA restructure in 1977; the NCUSIF redesign in 1984; passage of CUMAA in 1988; the TCCUSF in 2009; and today.

The only occasion when the impetus was not a national economic crisis was the Membership Access Act in 1998 following the Supreme Court’s decision to narrowly define FCU’s field of membership.

The current prospect of more pandemic legislative is another of these infrequent occasions. But the legislation needed is not a temporary extension “to the end of the pandemic,” but a rethinking of the role of the CLF in the cooperative system.

Such a reform would focus on the system’s total liquidity needs, not mere firefighting in a crisis. It would involve three areas of change:

  1. Broaden the purpose and scope of the CLF. The fund would be charged with improving access for credit union liquidity in both normal and extraordinary circumstances.
  2. Its operations would become a cooperative conduit to the secondary market much like Fannie and Freddie, not just an emergency source of cash.
  3. Its governance would be similar to the FHLB where the member owners would vote for a board of directors representing the membership. The board in turn would contract with NCUA and corporates on the management of the fund’s short term and extended lending authorities.

Such a CUSO-like redesign would incorporate cooperative principles and focus solely on credit unions to provide members better options in good and difficult times.

The time to do this is now. The 45-year-old legislative assumptions and structure of the CLF are no longer relevant to the operations of today’s credit union system.

To make this happen, current credit union and corporate owners should provide their transformative design and request NCUA support for the legislation to bring it about.

Working together a new CLF could truly become a Cooperative Liquidity Facility and help underwrite a new era of credit union safe and sound practice Real reform would make this legislative effort truly innovative and consequential, versus temporary and irrelevant.

NCUA Appointments in a Biden Administration

Several probable NCUA board openings mean there will be new leadership at NCUA during the next year. In the past decade the appointments have been without any apparent industry influence. In several instances the board member had no credit union or regulatory background.

To bring knowledgeable and capable candidates to the new administration’s attention, the effort should begin now, be public and stress the importance of credit unions’ role in serving America’s consumers.

Biden Transition Teams In Place

The incoming administration recently announced over twenty transition teams to advise on every major government department and activity. The teams total over 530 people and were formed during the campaign. The complete listing is here:

https://buildbackbetter.com/the-transition/agency-review-teams/

Their role is described as: “Agency review teams are responsible for understanding the operations of each agency, ensuring a smooth transfer of power, and preparing for President-elect Biden and Vice President-elect Harris and their cabinet to hit the ground running on Day One. These teams are composed of highly experienced and talented professionals with deep backgrounds in crucial policy areas across the federal government. The teams have been crafted to ensure they not only reflect the values and priorities of the incoming administration, but also reflect the diversity of perspectives crucial for addressing America’s most urgent and complex challenges.”

One Credit Union Leader as a Member

The most recent employment column shows appointees from law firms, universities, consulting businesses, Visa, banking, think tanks and the ubiquitous “self-employed.” Scanning the listings, I could find only one current credit union leader in the group under the CFPB team.

Consumer Financial Protection Bureau

Bill Bynum Hope Enterprise Corporation Volunteer

Credit Unions know Bill as the CEO of the $352 million Hope FCU in Jackson, MS.

The transition team charged with overseeing federal regulatory agencies is listed below. I do not know if any of these have cooperative or credit union experience or are even credit union members.

However, at least four of the institutional employers of these members have credit unions serving their community. It would seem useful if the CEO’s of these credit unions would make contact and ask if it would be appropriate to bring credit union needs to the committee’s purview.

Federal Reserve, Banking and Securities Regulators

The Federal Reserve, Banking and Securities Regulators group includes the Commodity Futures Trading Commission, the Federal Deposit Insurance Corporation, the Federal Reserve, the National Credit Union Administration, and the Securities and Exchange Commission.

Name Most Recent Employment Source of Funding
Gary Gensler, Team Lead Massachusetts Institute of Technology Volunteer
Reena Aggarwal Georgetown University Volunteer
Mehrsa Baradaran University of California, Irvine School of Law Volunteer
Lisa Cook Michigan State University Volunteer
Amanda Fischer Washington Center for Equitable Growth Volunteer
Andy Green Center for American Progress Volunteer
Campbell Haynes Virginia Coordinated Campaign Transition — PT Fund, Inc.
Simon Johnson Massachusetts Institute of Technology Volunteer
Dennis Kelleher Better Markets, Inc. Volunteer
Satyam Khanna New York University, School of Law, Institute for Corporate Governance and Finance Volunteer
Renaye Manley Service Employees International Union Volunteer
Lev Menand Columbia University Volunteer
Damon Silvers AFL-CIO Volunteer
Victoria Suarez-Palomo Orrick, Herrington & Sutcliffe, LLP Volunteer

It’s About Relationships

Credit unions’ competitive advantage depends on the relationship with its member-owners. Politics depends on relationships built on loyalty. Now is the time to reinvigorate existing relationships or establish new ones. Maybe we could start by asking Bill Bynum for counsel?