Welcome & Call to Order Approval of Minutes CEO & President s Message Supervisory Committee Report

Transcription

1

2 Welcme & Call t Order Apprval f Minutes CEO & President s Message Supervisry Cmmittee Reprt Treasurer s Reprt New Business Bard Electins Adjurnment Annual Meeting pened at 4:42 PM. 15 Members were present. Apprval f minutes f 2015 Annual Meeting B. Olander s name was spelled wrng in thse minutes, mtin R. Inzana with that name change, secnd B. Olander carried. Brian Thank yu t everyne fr cming, being n the Bard, Supervisry Cmmittee and Educatin Cmmittee. We have dne well because f yur supprt and guidance. We finished 2015 with strng earnings, hwever, earnings are dwn frm 2014 due t lcal ecnmy and lw net interest margins, which is typical in the industry. Net interest margin is the interest earned n lans and investments less interest paid n shares and brrwings. We are trying t stay shrt with the investment prtfli and this cntributes t lwer margins. During the last 5 years, many have been saying interest rates wuld g up. New regulatins have been detrimental t CUs and banks. The cst f cmpliance has significantly added t ur expenses. We did hit a milestne f $250 millin in assets in We surpassed $200 millin in 2011 we have grwn by $100 millin in the last 8 years and $150 millin in the last 14 years. That is significant grwth. Technlgy has allwed us t grw and service ur members with a great team f a little ver 50 emplyees. In additin t the technlgy, we prvide a high level f persnal service. We gained a cmpetitr in the area (Hamlin Bank), hwever, we d nt hear much abut them. Lan vlume is dwn, while we remain very cmpetitive with ur lan rates. Thank yu t all the emplyees fr the great jb they d in helping us grw. Supervisry M. Panci read the reprt and thanked everyne n the Bard. Mary - Treasurer s Reprt we reviewed the graphs and charts n page 5 f the Annual Reprt. Net Wrth is up. Ttal assets are up. Member lans are dwn, while member depsits are up. ROA drpped belw 1% as net Incme is dwn. Electins It was annunced that there is 1 Bard f Directrs vacancy. The Nminating Cmmittee nminated incumbent Glenda Hall. Mtin t accept the nminee by Lla Stughtn secnd by R. Inzana Carried. Pat Kelly, Bard President, called fr a vice vte. All members present, vted yes t elect the incumbent. Passed. Pat Kelly, President f the Bard, thanked everyne n the Bard, Supervisry Cmmittee, Educatin Cmmittee and emplyees wh help in many ways. The emplyees are appreciated fr their wrk. It is nticed. Annual meeting adjurned at 4:50 PM by mtin by J. McInry, secnd M. Panci carried.

3 Thank yu fr yur Membership and supprt f ur Credit Unin 2016 was anther gd year fr ur Credit Unin. We cntinue t grw in assets in a difficult ecnmic envirnment. Our supprt f the lcal cmmunity alng with the ability t make all lan decisins in ur Olean building cntinue t make a difference. The majrity f ur cnsumer lans result in members leaving with a check the same day that they applied fr the lan. Lcal and fast decisins fr business lans als cntinue t yield results. Checking accunts increased by a net 115, while verall membership accunts declined by 376 (212 clsed by transferring t related accunts) and members cunted by scial security numbers declined by 488. Our gal is t increase checking accunts, which makes us ur Members primary financial institutin. While increasing ur checking accunts, lbby traffic cntinued t drp, due substantially t the cntinued member switch t electrnic cnvenience. Lbby transactins decreased by 13,060. ATM withdrawals nly increased by 953. The majrity f the depsit transactins were transferred t mbile depsits and slightly t ATM depsits. Mbile depsits increased by 8494 ver (Mbile depsit was nly available fr 6 mnths in 2015) and ATM depsits increased by 731. Transactins by mbile increased by 37,571 t 127,700. We are challenged t market t the members that transact by electrnic means. Marketing using scial media and is nw part f ur strategy. We hpe t pick this up in Intrducing a new CEO t ur Members and ur team will be an imprtant part f Our Bard has spent a lt f time t make sure that we have the right persn t guide ur Credit Unin int the future and the right persn t keep ur Credit Unin a catalyst in ur cmmunity and lead the Credit Unin team. Thank yu again fr yur Membership and supprt. The missin f the Supervisry Cmmittee is t safeguard member assets by verseeing the integrity f the Credit Unin s financial statements, internal cntrls and cmpliance with legal and regulatry requirements. The Supervisry Cmmittee is als respnsible fr engaging internal and external auditrs t ensure management meets financial reprting bjectives and fllws General Accepted Accunt Principals (GAAP) and NCUA regulatins. In 2016, an internal audit was cnducted by The Bnadi & CO LLP. The internal audit prvides an additinal layer f review f the financial cntrls used. An external CPA audit was cnducted by Mengel Metzger Barr & C. LLP in September Thrughut 2016, we bserved that Olean Area FCU cntinued t meet the requirements f the Natinal Credit Unin Administratin (NCUA). The federal examiners f NCUA als audited the Credit Unin and n findings were reprted. All Cmmittee members as well as Bard f Directrs cmpleted training required by the NCUA. The Cmmittee has cncluded that the Olean Area FCU perated in a safe and sund financial manner and assets f the membership are being effectively safeguarded. The cmmittee welcmes all cmments and suggestins frm ur members. Cncerns and questins may be directed t: Olean Area Federal Credit Unin Supervisry Cmmittee, PO Bx 201, Olean, NY Thank yu t the Bard f Directrs, Cmmittee Members, Credit Unin Management, and Credit Unin Emplyees.

4 During 2016, Olean Area Federal Credit Unin cntinued t fcus n maintaining earnings amidst the cntinued struggling Olean area ecnmy. In 2016, we finished with a Return n assets f 1.05%, cmpared t peer average f 0.51%. The Credit Unin earnings increased by $0.4 millin r 20.61% t $2.7 millin. This increase was mainly due t $348,000 reductin t lan/share lss reserve allcatin, after substantial imprvements in lan delinquency. In 2016, lan incme decreased by 2.84%, and ur cst f funds (0.45%) remained higher than credit unin peers (0.37%). Shrt term rates have finally began t rise; hwever, lng term rates have remained lw resulting in a net interest margin decrease in 2016 by.10% t 2.72%. The Credit Unin s als remains able t keep ur verall perating expenses lw cmpared t peer, 2.34% vs 3.68%. Our balance sheet remained strng as ttal assets reached ver $262.5 millin, a grwth f 2.90%. Lans utstanding increased by 0.91% t $151.7 millin. This increase was due t a $5 millin purchase f cnsumer lans with full recurse. Member depsits increased by 2.48% t $224.0 millin, the largest increase ccurring in mney market 6.61%. During 2016, we increased ur investment prtfli by $6.2 millin and have als reduced the average life by apprximately ½ years in anticipatin f rising rates. Olean Area s Net Wrth remained strng at 14.07%, as cmpared t peer s Net Wrth f 10.95%. Net wrth is a measure f capital strength f the credit unin. Our strng net wrth prvides us the pprtunities t invest in new prducts and services that enhance the value f membership. One f the mst imprtant gals f the Bard f Directrs and Management is t remain financially safe and sund. Olean Area Federal Credit Unin enters 2017 financially stable, and well psitined fr future grwth in years t cme as the area ecnmy rebunds. Assets $262,518, % Lans $151,740, % Shares $223,954, % Members 17, % The fllwing incumbents are nminated fr a 3-year term t the Bard f Directrs: Rnald Inzana Patrick Kelly Jean McInry

5 Year End December 31, Assets Lans $151,740,251 $150,367,909 Allwance fr Lan Lss -2,542,612-2,614,019 Net Lans 149,197, ,753,890 Cash 3,134,180 2,866,637 Ttal Investments 95,069,576 88,832,828 Other Assets 15,116,922 15,660,765 TOTAL ASSETS $262,518,317 $255,114,120 Liabilities and Equity Ttal Liabilities $1,453,680 $2,317,842 Savings 64,278,716 60,587,695 Checking 31,441,085 29,492,399 Mney Market 70,367,025 70,554,721 IRA 4,275,165 4,427,562 Certificates 53,592,067 53,464,817 Ttal Shares 223,954, ,527,194 Ttal Reserves 37,110,580 32,152,501 TOTAL LIABILITIES AND EQUITY $262,518,317 $252,997,537 Interest Incme Interest n Lans $6,729,349 $6,925,802 Interest n Investments 1,112, ,215 Ttal Interest Incme $7,841,786 $7,862,017 Interest Expense Dividends Paid n Shares $1,152,050 $1,160,044 Interest n Brrwed Funds 8,354 13,085 Ttal Interest Expense $1,160,405 $1,173,130 Net Interest Incme $6,681,381 $6,688,887 Prvisin fr Lan Lsses 306, ,000 Net interest incme after PLL $6,375,381 $6,034,887 Nn Interest Incme 2,407,969 2,362,523 Nn Interest Operating Expense 6,057,309 6,137,271 NET INCOME $2,726,041 $2,260,139

6 # OF TRANSACTIONS THOUSANDS Reserves and Undividend Earnings 27 millin 32 millin 29 millin 37 millin 34 millin Net Wrth 12.89% 13.41% 14.07% 11.93% 12.03% Lan Prtfli 42% First Mrtgages 25% Aut Lans 17% Cmmercial Lans 5% Unsecured Lans 5% Other Real Estate 4% Credit Cards & LOCs 2% Other Lans Share Prtfli 31% Mney Market 29% Shares 24% Certificates 14% Share Drafts 2% IRA Shares Teller ATM Withdraw Audi Respnse Hme Banking Mbile CU ATM Depsit Mbile Depsit

7

8