2014 Annual Report - U$X Federal Credit Union

PRESIDENT’S REPORT
As a member & owner of U$X Federal Credit Union you have good reason to be
proud of the way in which your financial cooperative operates, our vision for the
future and the execution of our mission. A well run financial institution gives you
the comfort of knowing that your money is safe and that you have a partner that
you can count on. Whether in good times or bad, you can be sure that U$X Federal
Credit Union will always work with its members to accomplish their financial
objectives and overcome any financial challenges.
While the strength of our cooperative is well documented throughout this report, I
want to draw your attention to a few that might escape your notice.
Peer
U$X FCUCredit Unions
Net Interest Margin 3.68%3.25%
Capital
14.58%10.78%
Delinquencies
.98%.94%
Loan growth
6.94%6.95%
Membership growth
9.60%1.40%
Net Interest Margin is a measurement of our ability to manage the conflicting
pressures of our members’ desire for lower loan rates and higher deposit rates. It
is important that we keep both constituencies happy as we conduct our day to day
operations. The fact that we can consistently maintain this margin minimizes the
impact of interest rate fluctuations in the economy. A healthy margin also makes
U$X Federal Credit Union less dependent on fee revenue, unlike many other
financial institutions.
Capital is the layer of protection we have earned by serving our members year in
and year out. At 14.58% our capital is significantly higher than most other financial
institutions in the areas we serve. When other financial providers needed to be
bailed out by the federal government during the financial disruptions of the last
few years this resource allowed U$X Federal Credit Union to operate smoothly and
without interruption.
The Delinquency ratio is an indicator that we try to serve all our membership,
not just those with excellent credit. A significant decrease in delinquencies is
an indication of our renewed efforts to help members establish a sound financial
footing.
Loan growth year in and year out provides an indication that we are serving
additional members by meeting their credit needs and that we are earning a greater
portion of their business. Our team is exceptionally focused on doing what is best
for the member. Should we find that you have an alternate provider who can provide
you a better deal, we will tell you. Remember, the best interest rate is frequently
not the indicator of the best deal. Our staff will skillfully suggest alternate ways to
package a transaction to improve your credit and save you the most money.
Membership growth is an indication that our reputation is growing and additional
participants are joining our field of membership. Much of our growth in this area
this year came as a result of three mergers. This is a renewed area of focus for our
team. If you have a coworker, family member, neighbor or friend that you want
to help, introduce them to one of our team members and we will teach them how
to improve their financial life. The Credit Score Analysis consultations we have
performed for members in 2014 followed by restructuring of the members’ credit
saved these members over $3.2 Million.
In addition to all this, in 2014 U$X Federal Credit Union introduced U$X
Financial Group an affiliate which provides brokerage and financial planning
services. This program, led by our associate Nathan Rodgers, adds yet another
piece to our one stop range of financial services. We can now meet all your personal
financial needs from birth to retirement. I encourage you to meet with Nathan and
take advantage of this valuable new service. It is never too early to start planning
for the major events in your life.
U$X Federal Credit Union’s Mission is this: We are a financial cooperative existing
to provide members with advantages in every aspect of their financial life and the
confidence of financial security. I believe as you review the facts throughout this
report you will conclude even as I did, that the U$X Federal Credit Union team has
effectively delivered each aspect of the mission we established.
How do we do that? We do the right thing for the member in front of us, we do the
right thing for all the members, and we do the right thing to preserve our financial
cooperative for the next generation. In short, we strive to improve the financial life
of each member we interact with.
Our team of volunteers and employees accomplish this by evaluating each decision
to ensure that we get a positive return for each dollar we spend or invest; and we
adhere to our core values in how we conduct business, in how we think, and in how
we act.
2014 has been a challenging year, a year of transition. As we work together in the
coming year; every employee, every volunteer, and every member has the opportunity
to move forward in growth, positive impacts, and a rewarding experience for our
members. I encourage you to join me on this exciting journey.
Our staff, volunteers and I all thank you for the opportunity to serve.
Sincerely yours,
David R. Ackerman, President/CEO
CHAIRMAN’S REPORT
U$X Federal Credit Union can look proudly at 77 years of continuous growth
and success. The strength of the credit union can be evaluated and reported in
many ways however the real strength is the people. The professionals who we
hire to operate the credit union each day and the volunteer staff both past and
present who dedicate their time and talent to make it work.
It is with pleasure that I can report 2014 was another year of success with many
accomplishments and your credit union remains a safe and sound financial
cooperative. We have witnessed quality growth over our 77 years in existence
and continue to offer products and services necessary to meet the needs of our
members in today’s complex and competitive financial world. We have never
strayed from our movement’s motto of “people helping people” or our mission
to improve the financial lives of our members.
We concluded 2014 with yet another favorable bottom line accompanied with
many successes. Total assets at year end were $208.2 million dollars which
represents a 2.6% growth from the previous year end assets of $202.9 million
dollars. Net member growth was 9.6% and we had 22,746 members as of
year-end. Contributing to this growth were three mergers and we welcome
the members from Pittsburgh Pepsi Cola FCU, Westho FCU located in
Greensburg, PA., and IBM Pittsburgh FCU located in Mckees Rocks, PA.
Our net loan growth for 2014 was 6.95% ($56 million dollars or 5,222 loans
were originated during 2014) which was slightly less than the previous year’s
growth which was an exceptional year. Through the efforts of our loan
department working with members we were successful in saving our members
in excess of $3 million dollars of interest charges by refinancing their loans
with the credit union.
Based on the national credit union administration’s (NCUA) definition our
credit union is categorized as a well-capitalized credit union with a strong
14.1% net worth position. We are well positioned for continued quality growth
as well as facing any competitive pressure or adverse economic conditions
should they arise.
Our asset liability committee closely monitors our investment portfolio and
does an excellent job in minimizing risk while still earning a fair return on our
investments. As of year-end the market value of our total investments were
$64.7 million dollars with a weighted yield of 0.99% of which $54.9 million
dollars represent securities available for sale (AFS) with a weighted yield of
1.10%.
Your board of directors was once again pleased to declare payment of a member
loyalty reward. The year-end distribution to members in good standing
amounted to approximately $424,000.00. This reward was in addition to
the $328,326.00 returned to our members as part of the U$X FCU VISA®
Scorecard Cashback program. We do this because we firmly believe if you
use the products of the credit union you deserve to reap the benefits of these
programs and it’s the right thing to do!
Our marketing and business development efforts continue to be successful.
Our strategic plan for growth includes adding new Preferred Partners or
through merger opportunities that will benefit U$X FCU as well as the
members of the merging credit union. In addition to three mergers during 2014
we added 14 Preferred Partners to our field of membership and now have well
over 600 Preferred Partners groups.
Financial advisor – we have partnered with CUNA Brokerage Services, Inc.
(CBSI) and have added Mr. Nathan Rogers a financial advisor to our team
to provide members with guidance and advice on alternative investment
opportunities, retirement planning, as well as insurance and estate protection
planning. Contact any of our offices for an appointment to meet with Nathan
and discuss your financial situation with him.
The board of directors are your representatives and are committed to always act
prudently in managing and overseeing the financial affairs of the credit union.
It is only through the dedication, passion and efforts of all of our employees
and volunteers that we achieve success. I am pleased with the performance and
results in 2014 and I am optimistic that collectively we will have a successful
2015.
It is an honor and privilege to represent you, serve as chairman and to be a part
of an outstanding and professional team. My thanks to all of our employees for
a job well done and to all of our loyal members, who are the basis for growth
and prosperity, I thank you for your trust and support of our credit union.
Sincerely,
John E. ( Jack) Toth, Chairman
SUPERVISORY COMMITTEE REPORT
FINANCIAL STATEMENTS
We are a $208.2 million full service Credit Union with over 22,746 members.
The credit union has seven offices operating in Pennsylvania and two offices
operating in Ohio.
12/31/1412/31/13
ASSETS
Loans, net
$134,450,051 $125,542,550 The Supervisory Committee audits many aspects of Credit Union operations
Cash & Equivalents
9,613,990 9,160,016 to ensure:
Investments
57,355,110 60,878,157 Accounting reports and records are prepared promptly and accurately
Other
6,814,980 7,246,466 Internal Controls are in place to monitor activities
Total Assets
$208,234,131 $202,827,189 Policies and Operations are in compliance with state and federal regulations
In addition, the Supervisory Committee retains the accounting firm S.R.
LIABILITIES & EQUITY
Snodgrass, P.C. to perform a complete financial statement audit and the firm
Accounts Payable
$494,823 $455,578 Cottrill, Arbutina and Associates to perform a review of internal controls and
Certificate Dividends Payable
20,326 23,984 other internal audit functions.
Total Liabilities
515,149
479,562
The National Credit Union Administration (NCUA) also conducts an
Regular Shares
79,218,353 71,281,220 examination.
IMMA Shares
39,202,256 39,344,482 Checking Accounts
14,341,159 13,126,570 Each of these organizations review our loan portfolio, deposit accounts, credit
Certificates
43,857,775 49,321,595 card portfolio, operations, data processing, as well as policies and procedures
IRA Shares
658,944 655,361 in order to ensure that records are correct and that U$X Federal Credit Union
Total Shares
177,278,487 173,729,228 complies with current laws, regulations and accounting standards.
U$X Federal Credit Union continues to receive positive reports about its
Members’ Equity
30,440,495 28,618,399 effective operations and proactive management executed by volunteers and
employees.
Total Liabilities & Equity
$208,234,131 $202,827,189 Your Supervisory Committee is pleased to report that the affairs for the Credit
Union during 2014 were concluded in a superior manner and in accordance
INCOME
with all rules and regulation.
Interest:
Loans
$7,487,827 $7,164,728 A copy of the audited financial statement is available for review at our
Investments
661,310 709,798 administrative office in Cranberry Township, PA.
Total Interest
8,149,137 7,874,526 Richard C. Nichols
Non-Interest:
Supervisory Committee Chairman
Gain on Sale of Investments
2,300 26,763 Fees
1,140,829 1,143,684 12/31/14
Miscellaneous
1,983,022 1,854,680 INCOME
Total Income
11,275,288 10,899,653 Loan Interest
$7,487,827 66.4%
Investment Interest
661,310 5.9%
Other Income
3,126,151
27.7%
EXPENSES
11,275,288 Dividends:
Regular Shares
80,407 71,437 EXPENSES
IMMA Shares
117,736 110,815
Dividends 739,0326.6%
Certificates
540,278 668,336 Prov for Loan Losses
702,202 6.2%
IRA Shares
611
649
Operating Expenses
8,746,985 77.6%
Total Dividends
739,032 851,237 Loyalty Dividend
424,365 3.8%
Reserves
662,7045.9%
Provision for Loan Losses
702,202 830,350 11,275,288
Operating Expenses
8,746,985 8,017,048 Total Expenses
10,188,219 9,698,635 SOURCES OF INCOME
Income Before Loyalty Dividend 1,087,069 1,201,018 and NCUSIF Stabilization Expense
Loan Interest
Other Income
66%
Loyalty Dividend
424,365 444,758 28%
NCUSIF Stabilization Expense
-
137,333 Net Income
$662,704
$618,927
Investment Interest
6%
Reserves
6%
Dividends
Loyalty Dividend
6%
4%
Prov for Loan
Losses
6%
Operating
Expenses
78%
BOARD OF DIRECTORS
SUPERVISORY COMMITTEE
Richard C. Nichols, Chairman
John E. Toth, Chairman
John R. Adams
Albert J. Flynn, Jr.,Vice Chairman
Jose A. Quinones
Mashawn A. Lorenz, Secretary
James R. Thornton
Thomas M. White, Treasurer
Douglas J. Zywan
Richard C. Nichols
Cottrill, Arbutina & Associates, P.C. - Internal Audit Firm
Christopher Panian
CliftonLarsonAllen, LLP - External Audit Firm
James D. Settelmaier
Jose A. Quinones - Associate
Douglas J. Zywan - Assoicate
MANAGEMENT
DISTRIBUTION OF INCOME
David R. Ackerman - President / CEO
Valerie J. Stumpf - Vice President Operations
Mark A. Volponi - Executive Vice President/CFO
Timothy C. Wojtaszek - Vice President Marketing / Business Development
U$X FCU PRODUCTS AND SERVICES
MEMBERSHIP
VISA® PRODUCTS
➤ Preferred Partner Groups
➤ Family Memberships
➤ Once a Member, Always a Member
➤ VISA Platinum Credit Card
➤ VISA Gold Credit Card
SAVINGS PRODUCTS
REAL ESTATE LOANS
➤
➤
➤
➤
➤
➤
Share Savings Accounts
Christmas Club Accounts
Youth Club Savings Accounts
Designated Share Savings Accounts
Share Certificates
Insured Money Management Account
➤ Home Equity Loans
➤ Home Equity Lines-of-Credit
➤ Mortgages (Terms up to 30 Years)
MEMBER TRANSACTION PRODUCTS
➤ Free Online Account Access with
NETBRANCH
➤ Free Electronic BILLPAY
➤ Free Mobile Telephone Banking
TAX ADVANTAGED PRODUCTS
➤ Free Personal Financial Management Tools
➤ VISA Debit Card
➤ Individual Retirement Accounts (IRAs)
➤ Free Checking Account / Overdraft
➤ Roth IRAs
Protection
➤ Coverdell Educational Savings Accounts
➤ Member Plus Checking with Interest /
Deposits insured by the National Credit
Overdraft Protection
Union Share Insurance Fund
(NCUSIF) up to $250,000
➤ Over 97,000 Free ATM Machines
& No Surcharge Networks
U$X FINANCIAL GROUP➤ Direct Deposit
➤ Payroll Deduction
➤ Financial Planning and Retirement Services
➤ Toll Free Phone Access
➤ Wire Transfer Service
CONSUMER LOANS
➤ Money Orders
➤ New Vehicle Loans
➤ Used Vehicle Loans
1-888-219-3159
➤ Motorcycle Loans
➤ Boat Loans
www.usxfcu.org
➤ Motor Home Loans
➤ Signature Loans
➤ Stock / Share Pledged Loans
➤ Better Choice Loan Program
➤ Private Student Loan Program
Deposits insured by the National Credit
Union Share Insurance Fund
(NCUSIF) up to $250,000
EQUAL HOUSING
LENDER
U$X FEDERAL CREDIT UNION LOCATIONS
CRANBERRY/ADMINISTRATIVE OFFICES
1293 Freedom Rd PO Box 1728
Cranberry Twp PA 16066
Toll Free Number: 1-888-219-3159
Fax (724) 779-4656
Toll Free Phone Access 1-800-590-0207
NETBRANCH www.usxfcu.org
CRANBERRY EAST OFFICE
1694 Route 228 Ste 102
Cranberry Twp PA 16066
Fax (724) 772-0707
PITTSBURGH OFFICE
600 Grant St Concourse Level
Pittsburgh PA 15219
Fax (412) 433-4726
NEW STANTON OFFICE
100 Bair Blvd PO Box 657
New Stanton PA 15672
Fax (724) 925-3808
FINDLAY OFFICE
1038 Interstate Court
Findlay OH 45840
Fax (419) 427-0125
SARVER OFFICE
479 N Pike Rd
Sarver PA 16055
Fax (724) 352-5958
JEFFERSON OFFICE
575 Coal Valley Rd
Jefferson Hills PA 15025
Fax (412) 469-7176
MARATHON OFFICE
539 S Main St Rm 1024
Findlay OH 45840
Fax (419) 421-2339
GREENSBURG OFFICE
55 S. Washington Ave
Greensburg PA 15601
Fax (724) 853-9374