2016 ANNUAL REPORT IDAHO CENTRAL CREDIT UNION

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1 2016 ANNUAL REPORT IDAHO CENTRAL CREDIT UNION

2 Board Chair and CEO Message Idaho Central Credit Union stayed its course and celebrated another banner year in We are committed to our mission of Helping members achieve financial success, and continue to experience outstanding growth in several key areas. Our team believes in serving the needs of Idahoans, and we know that our most important asset is our members. Idaho Central has been on a journey for the past several years to create a culture where team members feel valued. We know building a world-class service organization begins within and our relentless pursuit of exceptional service has to be backed up by every single team member. Our team voted Idaho Central Credit Union the Best Place to Work in Idaho for the fourth year in a row, which is a testament that we are succeeding in this endeavor. We opened new branches in Pocatello, Caldwell, and Post Falls to better serve our members. Branch expansion is a focus area and we continue to aggressively look for locations that are convenient for our members. We are also in the process of expanding our Member Service Center campus to accommodate team member growth and storage needs. We are a driving force in Idaho and continue to perform well above the norms and averages for credit unions and banks our size. We lent $2.963 billion in consumer, commercial, and real estate loans, $145 million of which was loaned to Idaho businesses. Home and auto loans were at the core of our lending phenomenon as Idaho Central funded 9,697 and 43,567 loans respectively, totaling $2.562 billion. We reported 253,664 members at year end, a 17.4% increase over 2015! While growth is fundamental to the success of any financial institution, we love investing in our members by giving back to them. According to a recent study by Raddon Financial Group, Idaho Central gives back an average of $119 per year to each ICCU household in the form of lower loan rates and higher deposit rates, while high performing credit unions give back $73 per year. This means our members are in a better financial position by doing business with Idaho Central. In a rising rate environment that is uncertain, we will react with the same tenacity, vision, and diligence as always in the face of potential adversity and challenges. We would like to thank our membership for allowing us to serve their financial needs and for making us the number one Credit Union in Idaho. We would also like to thank the Board of Directors for their leadership, dedication, and unwavering support, and the many volunteers and entire staff for their hard work and dedication. Sincerely, Judy Harveston Chairman of the Board Kent Oram CEO Board of Directors Judy Harveston - Chairman Debbie Brady - Secretary Troy Neu - Director Dorothy Ricks - Vice President Marv White - Treasurer Cindy Watson - Director Russ McCoy - Director

3 Supervisory Committee Message Balance Sheet - December 31, 2016 Assets Change % Change Net Loans 2,540,433,815 2,182,149, ,284, % Cash and Investments 87,068,528 91,629,832 (4,561,304) -4.98% Fixed Assets 110,134,519 91,576,813 18,557, % Other Assets 73,259,979 53,035,713 20,224, % Total Assets 2,810,896,842 2,418,391, ,505, % Liabilities and Equity Total Liabilities 90,879, ,536,507 (185,657,199) % Total Deposits 2,473,526,583 1,945,927, ,599, % Total Equity 246,490, ,927,606 50,563, % Total Liabilities and Equity 2,810,896,842 2,418,391, ,505, % Supervisory Committee Shirley Lawson, Chair Cindy Riley Michelle Wilde Dallas Millington Jonathan Hunt Summary: The CPA firm, Poston, Denney, & Killpack, performed the 2016 CPA audit. The result of the audit was an unqualified opinion, please see the report following the Income Statement. During the year we also received a joint exam given by the State of Idaho Department of Finance and the National Credit Union Administration (NCUA). The examiners were pleased with their findings and complimentary of our policies and financial performance. For the year, assets increased $393 million and ended at $2.811 billion. Loans increased $358 million to end with outstanding balances of $2.540 billion. Deposits ended the year at $2.474 billion for an increase of $528 million. Net worth ended at $246 million posting an increase of almost $51 million.

4 Income Statement Statement of Income and Expense - December 31, 2016 % of % of 2016 Income 2015 Income Change Interest Income 84,354, % 65,061, % 19,292,756 Interest Expense 18,141, % 13,932, % 4,209,534 Net Interest Income 66,212, % 51,129, % 15,083,223 Provision for Loan Loss 6,625, % 1,946, % 4,678,761 Operating Expense 77,988, % 63,309, % 14,678,942 Other Operating Income 69,428, % 51,895, % 17,533,777 Net Income (before transfer) 51,028, % 37,769, % 13,259,297 Reserve Transfer (7,689,177) -5.0% (5,847,850) -5.0% (1,841,327) Provision for Loan Loss 6,625, % 1,946, % 4,678,761 Net Income (after transfer) 49,964, % 33,867, % 16,096,731 We certify that we have reviewed these financial reports. Based on our knowledge, they are materially accurate and do not contain any false statements or omission of material facts. These reports fairly present, in all material respects, the financial condition of Idaho Central Credit Union. We acknowledge our responsibility to establish and maintain disclosure and internal controls. We have designed our controls to ensure that material information about Idaho Central is made known and to provide a reasonable assurance that the financial statements conform to Generally Accepted Accounting Principles. We have evaluated these controls and certify they are effective. There have been no changes to these controls that have had a material affect on these financial statements. We have disclosed all significant deficiencies, material weaknesses, and fraud involving management or other employees with a significant role in our internal control over financial reporting. Kent Oram Brian M. Berrett CEO 1/6/17 CFO 1/6/17 We ended 2016 with net income of $51.0 million. The net income translated to a 1.94% Return on Assets.

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6 Statistical Report - December 31, Change % Change Total Number of Members 253, ,063 37, % Total Number of Branches % Number of FTEs % Return On Assets 1.94% 1.75% 0.19% 10.86% Net Worth Ratio 8.98% 8.32% 0.66% 7.93% Delinquency Ratio 0.39% 0.19% 0.20% % Charge-Off Ratio 0.15% 0.09% 0.06% 66.67% Deposits per Member 9,751 9, % Loans per Member 10,053 10,127 (74) -0.73% Membership Average Age % Relational Net Promotor Score 65.55% 68.43% -2.88% -4.21% Pocatello Branch opened in April 2016 Caldwell Branch opened in August 2016 Post Falls Branch opened in November 2016

7 Year End Trends Assets 3,000,000,000 2,500,000,000 2,000,000,000 1,500,000,000 1,000,000, ,000, Deposits 3,000,000,000 2,500,000,000 2,000,000,000 1,500,000,000 1,000,000, ,000, Loans 3,000,000,000 2,500,000,000 2,000,000,000 1,500,000,000 1,000,000, ,000, Members 300, , , , ,000 50,

8 2016 At A Glance Idaho Central Credit Union is headquartered in Chubbuck, Idaho, with 29 locations throughout Magic Valley, Treasure Valley, Southeast Idaho and North Idaho. Currently we are serving the needs of over 252,000 members. With our expansion to North Idaho and our continued improvement to products and services, we are committed to providing members with the most convenient method to manage their finances. Idaho Central enjoyed many successes in 2016 and celebrated the following major highlights: Named Best Performing Credit Union in the country by S&P Global Market Intelligence (formerly SNL Financial) for the fourth consecutive year. Voted #1 Best Place to Work in Idaho by our team members for the fourth year in a row. Enhanced our Visa Card offering with new Rewards Credit Cards and CardControl. Several team members were the recipients of prestigious community awards: Kent Oram, CEO, was honored as the Idaho State University Business Leader of the Year; Clint Shiflet, Commercial Loan Officer, was named Man of the Year and Business Person of the Year by the Meridian Chamber of Commerce; Jami Horrocks, Business Development Officer, received the Charlie White Award for Service to the Community from the Greater Idaho Falls Chamber of Commerce; and Stephanie Young, Business Relationship Officer, was selected as the Boise Young Professional s Outreach Work Team Member of the Year. Opened new branches in Pocatello, Caldwell, and Post Falls. Rolled out the new and improved ebranch and upgrades to our mobile banking platform. Recognized as the number one mortgage and auto lender in Idaho. Deployed a new consumer lending system, CRIF Action. Named Member of the Year by the Pocatello Chubbuck Chamber of Commerce. Improved net worth ratio through loan participations and non-member deposits. Increased Hispanic membership 39% over the last year and introduced new products to better serve this demographic. Added SBA 7a loans to our business product line, in addition to Real Estate Trust Accounts, Sweep Accounts, and Analyzed Accounts.

9 Community Impact Idaho Central Credit Union is committed to giving back to the communities where we live and work. We utilize different channels to provide contributions to nonprofit organizations in an effort to make a difference and strengthen Idaho communities. COMMUNITY INVOLVEMENT Through our Community Involvement program, team members support nonprofit organizations by volunteering their time. Ultimately our goal is to have a significant Green Team presence at events to demonstrate Idaho Central s investment in our communities. Team members are also encouraged to make monetary donations to organizations they are passionate about. In 2016, team members volunteered over 7,700 hours of their personal time to actively participate in community events, and personally donated over $25,000 to support nonprofits. Additionally, Idaho Central reviewed over 550 donation applications. We were able to support 129 different causes, and donate nearly $150,000 through our Community Involvement Program. COMMUNITY ECONOMIC DEVELOPMENT Idaho Central is a strong supporter of local universities and nonprofit organizations that provide opportunities to bolster the economy in Idaho communities. Through this channel, we donated to several entities including Alturas Academy, the ISU Foundation, the Foundation for Idaho History, the ISU Instructional Technology and Learning Center, and Together Treasure Valley. SCHOLARSHIPS In addition to active community involvement efforts and donating to causes to build up the economy, Idaho Central proudly donated over $40,000 to student scholarships.

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