ANNUAL REPORT. Partnering with you...

Transcription

1 2015 ANNUAL REPORT Partnering with you... on the road to success

2 whatever your road...

3 what is success Success can be defined in a multitude of ways and so much depends on perspective. Having a credit rating in the 800s... Following a plan to recover from bankruptcy... Erasing all debt... Choosing to take on debt to purchase a first home... Investing intelligently for retirement... Breaking free from living paycheck to paycheck... Going back to school to earn your degree... Helping your child pay for college... Starting a business... Expanding your business... At SCE Federal Credit Union, our member family is as different as their goals and dreams. However, one thing unites them. Each of them has something they want to attain and it s important to them and because of that, it is of utmost importance to us. we re here for you

4 At SCE FCU, our interpretation of success is quite simple: helping people. It is the reason we were founded more than 60 years ago and it remains our passion today. We are incredibly proud of the many ways we helped members and our local communities throughout the past year. Here are some particularly special highlights: We loaned more money than ever in the Credit Union s history. We are pleased not because we shattered records, but because so many of our members trusted us to finance their dreams. We funded more than $147 million in loans in 2015 first cars, first homes, vacation homes, loan consolidations, business start-ups, and so much more with affordable rates and fair terms. Our Board of Directors announced that Dan Rader, SCE FCU s longtime CFO, would become the Credit Union s next CEO. The leadership transition process began two years ago when Dennis Huber announced he would be retiring in June of Selecting a new CEO is one of the most important duties of a credit union s Board of Directors. Our Board led an extensive evaluation process, culminating in a selection incredibly well received by our staff and membership. We invested in current and future technologies to enrich levels of service and security for members: CardNav is a free smartphone app we launched to allow members the ability to set controls on their debit cards, including turning the card on and off, setting real-time transaction alerts, and limiting use by location or dollar amount. Credit card holders received chip-enabled cards, offering greater fraud protection. Debit card holders will receive their chip-enabled cards in We began work on projects that will debut in 2016, including an all-new website, online banking and report of the chair & ceo

5 bill payment filled with features and capabilities to make members banking experiences more powerful. Together with the nonprofit we founded, the Center for Financial Empowerment, we helped people in our local communities of Southern California and Southern Nevada: Our certification as a Community Development Financial Institution allowed us to further provide unique and affordable services to low-income residents. In addition to financial contributions to support local charitable organizations, more than one-third of our employees participated in community volunteer efforts. It was an incredibly successful year for the Credit Union and our member/owners. We helped people in record numbers in a financially responsible way that benefits our entire membership. We thank our members for entrusting the Credit Union with their financial needs, and for referring us to their friends and family. MARY STEUDLE Board Chair DENNIS HUBER President Chief Executive Officer

6 MARY STEUDLE Chair PATRICK McCLOSKEY Vice Chair WARREN LEHMANN Financial Officer KENJI COLEMAN Secretary GREG WALLACE Director NANCY BOND Director VICTOR DOMINGUEZ Director board of directors

7 After nearly 20 years with SCE FCU, and more than 40 years in the credit union industry, George Poitou began a well-deserved retirement at the end of George s years as the Credit Union s Chief Operating Officer were filled with much excitement and incredible growth. One of George s finest accomplishments, though, likely had nothing to do with our asset size or number of branches. It involved what has been his lifelong passion: serving the underserved, particularly those in low-income communities. George led the movement to offer what we now call mission-driven lending at the Credit Union. He would always say, It s not about a number. Listen to their story. When there was a way to responsibly help someone, who would likely otherwise be unable to get credit, he would find it. His booming voice and huge heart have helped change the paths for many. George s dedication has been commended nationwide. He was recently honored by the California and Nevada Credit Union Leagues with their Distinguished Service Award, which recognizes credit union professionals service to the industry. Shortly thereafter, we received word George was being inducted into the Credit Union House in Washington, D.C., where his name will forever adorn the walls, in recognition of his longstanding leadership and commitment to the credit union movement. SCE FCU has been extraordinarily fortunate to have George Poitou as one of its fine leaders. We look forward to his continued presence on the Board of Directors for the Center for Financial Empowerment, the nonprofit founded by the Credit Union. We wish George and his wife Carol the very best always as they journey through retirement together. road to retirement

8 WARREN LEHMANN Board Financial Officer DAN RADER Executive Vice President Chief Financial Officer 2015 was a financially successful year for SCE FCU. As a cooperative, we re committed to fulfilling the philosophical credit union mandate of helping people, including those of lesser means who have traditionally been underserved and excluded from accessing mainstream financial products and services in the greater Los Angeles and Las Vegas areas. Through a combination of affordable financial services and comprehensive financial education, we aim to help our members build assets and enjoy financial stability. Here are some of the SCE FCU financial highlights of 2015: Ended the year with assets of $636.4 million Net income of $2.9 million ($1 million over budget) Totaled $147.4 million in funded loans Had $66.2 million in Member Business Loans (MBL) an increase of $14.1 million over 2014 and $2.2 million over our 2015 goal Ended the year with shares of $547.8 million ($13.1 million above budget) Total loan growth (including MBL) of $61.3 million ($25.4 million over our goal) Delinquency ratio of.94% and loan loss ratio of.29% Our regulators (NCUA) define a well-capitalized credit union as having at least 7% of its assets in reserve. SCE FCU finished the year at a very healthy 9.9%. Overall, your Credit Union is financially strong and able to meet the financial needs of our member/owners for the foreseeable future. financial report

9 $318,827,592 $341,010,742 $402,350,319 $513,071,984 $518,593,481 $547,782,890 $55,602,983 $59,812,520 $62,724,600 loan growth share growth net worth growth

10 total income $31,959,935 $30,167,436 expenses Personnel $14,484,371 $12,693,563 Office Operations & Occupancy 6,400,595 6,131,151 Loan Servicing 1,821,831 1,801,547 Professional/Outside Services 1,348,883 1,601,397 Education/Promotion 829, ,900 Provision for Loan Losses 151, ,000 Other 1,276,259 1,008,793 Total Expenses $26,312,662 $23,125,351 Total Interest Expense & Dividends 2,735,193 2,832,548 net income $2,912,080 $4,209,537 34% Vehicle 33% Real Estate 2% Other 16% Business 9% Visa 5% Personal As of December 31 Unaudited statements of income distribution of loans

11 30% Money Market 17% Checking 29% IRAs & Certificates 25% Savings assets $197,480,717 $233,115,258 Cash & Investments 397,557, ,281,157 Loans, Net 17,193,758 17,390,751 Fixed Assets 24,121,233 22,030,296 Other Assets $636,353,534 $607,817,462 total assets equity & other liabilities $547,782,890 $518,593,481 Shares & Certificates 62,724,600 59,812,520 Reserve & Undivided Earnings 25,846,044 29,411,461 Other Liabilities $636,353,534 $607,817,462 total equity & liabilities As of December 31 Unaudited distribution of shares financial condition

12 MICHAEL MAXWELL Chair CHRIS CARTER Member BILL TORRES Member PATRICK McCLOSKEY Member CONNIE PEREZ Member supervisory committee

13 The Supervisory Committee, a group of volunteers appointed by the Board of Directors, is primarily responsible for overseeing the overall safety and soundness of the Credit Union. The committee meets every other month with the Credit Union s internal audit team to monitor adherence to operating practices and procedures. In addition, the committee contracted with the independent accounting firm of RSM US LLP, formerly known as McGladrey LLP, to audit the Credit Union s records for the twelve months ending March 31, Once again, we are pleased to report the assets held by SCE FCU are safe and secure and no significant findings were reported. Furthermore, our review concludes that SCE FCU is in compliance with federal regulations and standards provided by the National Credit Union Administration (NCUA). The Supervisory Committee congratulates the SCE FCU volunteers, managers and members on another successful year. report of the supervisory committee

14 making a difference...

15 SCE FCU s commitment to the underserved is evident through the work of the nonprofit we founded, the Center for Financial Empowerment. In 2015 the CFE further defined its mission to break the cycle of generational poverty and create more stable communities through financial empowerment for youth. Here are a few ways that was accomplished: 63 financial literacy workshops facilitated, providing financial education to nearly 1,800 high school students and community residents 5 Mad City Money reality simulation events, preparing 465 teen participants for real-life finances $15,500 in college scholarships awarded to 14 students New collaborative partnership established with the Uplift Foundation of Nevada, to bring financial education and empowerment opportunities to underserved high school students in the Las Vegas area The symbiotic relationship between SCE FCU and the CFE gives us the unique ability to equip young people with not only financial knowledge, but also with the right financial tools to put their knowledge into action. It s a winning combination that continues to benefit youth in our communities year after year. We invite our members to join us by investing in the financial education of our youth. Visit Center4FE.org to find out more and join us in our efforts to break the cycle of generational poverty. in the community

16 consumer lending visa credit cards real estate loans checking & savings A full array of loans, offering highly competitive rates, fair and flexible terms, no or low down payments, and a quick application process: Auto Loans - new, used, refis, street-bikes & classic cars Auto Equity Loans, which may provide a tax-deduction Recreational Loans - new & used RVs, travel trailers, 5th wheels, dirt bikes, boats, personal watercraft & off-road recreational vehicles CU at the Wheel - our complimentary auto buying concierge service exclusively for SCE FCU members, saving time, money and the typical car buying frustration Personal Lines of Credit SCE FCU credit cards are loaded with great features no annual fee, low interest rates, generous limits and fair terms: Visa Platinum Rewards Credit Card, with no annual fee and points toward travel, gifts, and merchandise Visa Platinum Credit Card, with no annual fee Zero-Liability Protection in the event of fraud Whether members are purchasing a home, refinancing, or utilizing equity, we have programs in California and Nevada for: First Mortgage Loans for purchase or refinance Second homes, vacation homes, rental properties FHA & VA Loans (in California) & first-time buyer options Reverse Mortgages Conforming or Jumbo, fixed or adjustable rates, variety of terms Fixed-Rate Home Equity Loans, Variable-Rate Lines of Credit & Split Second Loans Owner- and non-owner occupied Our deposit accounts feature competitive rates and many free options: Free Checking with no catch! Green Checking paying dividends with no minimum balance required and offering a Debit Rewards program Free overdraft from other SCE FCU accounts Free Visa Check Cards Savings & Money Market Accounts Holiday & Vacation Club Accounts Certificates, IRAs & Coverdell ESAs Health Savings Accounts Youth Accounts products & services

17 convenient access business banking insurance investments We re always open somewhere! Deposit Anywhere deposit checks straight from your Android or iphone Nearly 30,000 Surcharge- Free ATMs, including at most 7-Eleven locations SCE FCU Branches in Southern California & Southern Nevada Shared Branches across the US FastLine Automated Teller 24/7 Contact Center, with full-service 6 days a week and select service outside of regular hours Online Banking & Bill Pay Customized smartphone apps Snapshot, online personal financial manager Fair and affordable banking options for small- and mediumsized businesses: Free Business Checking, Commercial Checking, & Commercial Advantage Checking, which pays dividends Business Certificates Money Market Accounts Revolving Lines of Credit Business Term Loans Commercial Real Estate Loans SBA Loans Business Visa Credit & Debit Online Bill Pay Mobile Deposit Member Advantage, our Credit- Union-owned insurance agency, offers competitive pricing from dependable insurance providers such as Allied, Mercury, Travelers Progressive, and many more. Member Advantage Insurance Services offers coverage for: Home, Auto, Motorcycle, RV & Watercraft Life Business & Commercial Property Liability & Workers Compensation Member Advantage INSURANCE SERVICES In addition to the many investment options the Credit Union offers, we invite you to utilize the services of SCE FCU Wealth Management for assistance with: Strategies for generating lifelasting income Investment management and retirement planning Life, disability and long-term care insurance Estate planning Stocks, bonds, mutual funds and annuities 401(k) rollovers Securities offered through LPL Financial, Member FINRA/SIPC. Insurance products offered through LPL Financial or its licensed affiliates. The investment products sold through LPL Financial are not insured SCE FCU deposits and are not NCUA insured. These products are not obligations of SCE FCU and are not endorsed, recommended or guaranteed by SCE FCU or any government agency. The value of the investment may fluctuate, the return on the investment is not guaranteed, and loss of principal is possible. LPL Branch Office: Schabarum Ave, Irwindale CA 91706

18 working together Coming together is a beginning; Keeping together is progress; Working together is success. ~ Henry Ford working together with our members...

19 making dreams a reality!

20 EQUAL HOUSING LENDER Credit Union federally insured by NCUA. Equal Housing Lender scefcu.org