Doing more for our members. 20 Annual Report
Mission Statement To anyone who lives, works, worships or attends school in Ulster, Dutchess or Orange County, is your trusted community credit union. Our mission is to make your life easier by providing personalized and convenient financial solutions and a member experience driven by innovative technology, reliable service, and easy access you can rely on. Brand Standards Safety and Soundness Compliance Confidentiality Member Experience Convenience Efficiency Doing more for our members As a not-for-profit financial cooperative, we are in business of improving well-being of our members; however we believe this extends beyond simply financial success of each individual to entirety of our collective communities. We are proud of our efforts to improve lives of all who live in tri-county community that we serve. Read on to learn how we do more for our members each and every day.
By supporting causes that effect us all When our staff was challenged to ALS Ice Bucket Challenge, we took it to next level by using it as an opportunity to educate our community about effects of this debilitating disease to raise funds to benefit ALS Association. By investing in our local communities We relocated to a new, larger branch facility to better serve our Woodstock and West Hurley members with additional staff and on-site parking. In this unique building project, we restored a historic building beloved by local community. By helping our members reach financial goals We helped our members put more money back into ir pockets with two great promotions. At beginning of year, we introduced our Holiday Financial Hangover Personal Loan special to help members get back on track after holiday shopping season. Over 150 members consolidated ir higher interest debt into a low rate Personal Loan. In Fall, we gave members opportunity to refinance ir auto loan with us and get 2% cash back. We helped over 275 members achieve ir goal of paying off ir auto loan faster or lowering ir monthly payment. By elevating our level of service In summer of 2014, we moved our Call Center in-house to provide better service and support to our members. As a result, we created over 20 new jobs to benefit our local community. By investing in new technology We set foundation in 2014 for furr improvements in our technology that will save you time and money, and provide for a better electronic banking experience. Look out for Mobile Check Deposit, e-docs electronic documents, and a fresh, new FCU.com website in early 2015.
Chairman and President s Report At Mid-Hudson Valley Federal Credit Union, we remain committed to financial viability through sustained growth, profitability and member satisfaction. These values have successfully guided this institution for over 50 years and 2014 was no different. Safety and Soundness of our members assets is our #1 Brand Standard and continues to be primary consideration of all our strategic objectives. Over past year, we provided our membership with value added products, reliable service, innovative technology and convenience through careful planning and fiscal responsibility. Your credit union continues to be a very strong, capitalized credit union and continues to receive favorable audits and regulatory examinations, as you will see reported in our Treasurer s and Supervisory Committee reports. In 2014, we began to see national economy gain traction; annualized GDP rose to 2.4%, its highest mark in four years. Consumer confidence and job growth levels hit ir highest mark since 2008, prompting Federal Reserve to stop its six year old stimulus program, known as quantitative easing, in October. The action taken by Federal Reserve is a strong indication that interest rates will begin to rise in 2015. In Hudson Valley Region, private sector job growth continued to lag behind or regions in New York State and nation as a whole. As such, we continue to reach out and provide assistance to our members who are having financial difficulties in making ir loan payments. In spirit of credit union philosophy of People helping People, we offered two special promotions to help put more money back into our members pockets. Our Holiday Financial Hangover Signature Loan promotion gave members opportunity to consolidate ir higher interest credit card debt leftover from holiday season. Our 2% Cash Back Vehicle Loan refinance promotion helped members lower ir loan payment and pay off ir debt faster. These two promotions were warmly embraced by our membership, generating over $5m in consumer loans in 2014. We remain committed to providing our members with financial solutions that meet ir needs, which is reflected in many ways. In 2014, loan growth was up 6.1%, granting $48.5m in residential loans, $77.2m in vehicle loans and $17.8m in member business loans. Our commitment to providing our membership with an experience driven by innovative technology, reliable and secure services, and easy access you can rely on, was clearly reflected on a number of major initiatives on service delivery. In November we unveiled Visa Signature, a competitive travel and merchandise rewards credit card. The new card is EMV compliant, which helps to combat escalating rate of card fraud in large part to ongoing massive payment data breaches. Your credit union has begun process of converting all of our payment cards to EMV chip technology, which is one of best measures to protect members from fraud.
In June, we made a bold statement in Woodstock by opening a larger full service branch facility replacing our 650 square foot store front office. The new 3,500 square foot branch provides an increased level of service for our Woodstock and West Hurley members including on-site parking and increased branch staff. In July, we brought our call center operations back in house, an operation that was previously outsourced for past 9 years. This strategic decision not only elevated level of service provided to our membership, it has also created many new jobs in our community. Also, for our small business owners who need quick credit decisions to operate ir business, we unveiled our 24-Hour Business Express Approval for credit lines up to $25,000. Looking ahead to early 2015, we will be unveiling Mobile Check Deposit. This technology will enable members to make check deposits anywhere, anytime from ir mobile phone or tablet devices. In addition, our new website will be launched in early 2015. The new website will not only have a fresh, streamlined look, it will also incorporate responsive web design technology. Responsive design will provide an optimal viewing experience on any size screen including desktop, mobile and tablet. Our Investment & Retirement Center continues to provide our members with a full array of products and services. The program currently has over $142m under its management and is ranked as one of top rated programs of its type in our nation. From financial and retirement planning, paying for college education, estate planning and insurance products, we are committed to helping our members achieve ir goals. In addition, Mid-Hudson Valley Insurance Agency provides our membership with insurance products and efficient service for your personal and commercial needs. Our staff s commitment to members goes beyond role y carry out each and every day. Giving back to our communities is something we are very proud of. The employees of are involved in all sorts of community outreach programs. The American Cancer Society, JDRF, United Way, American Heart Association and VA Food Pantry are just a few of many programs that we support. We know our members have many choices when selecting a financial institution and we are committed to keeping financial institution of choice. In closing, we would like to thank volunteers, management and our employees for all ir hard work, commitment and continued support. Our combined efforts are reason why continues to be a very safe, sound and innovative credit union. Gary E. Anderson Chairman of Board Wayne Winkler President and CEO
Treasurer s Report The U.S. economy continued to improve in 2014. The unemployment rate had declined to 5.6% by year end and consumer confidence has increased. The price for a barrel of oil dropped to $60.70 as of December 31, 2014 as compared to $105.48 just one year ago, increasing purchasing power of many Americans. Loan rates continued to be offered at historic lows allowing many opportunity to purchase new homes and autos. Mid-Hudson Valley Federal Credit Union is a financial cooperative that is committed to improving lives of its members. With low rates and great terms on auto loans, we provide members opportunity to buy ir first car or car that y have always wanted. With consumer loan specials such as Holiday Financial Hangover, we assist members in paying off credit card debt that may be held at a much higher interest rate. With great mortgage programs and service, we assist members with buying or building home of ir dreams. In 2014, se and or programs assisted to grow ir loan portfolio by $29.4m or 6.4%. Yet despite improved economy and beneficial terms on loans, many Americans including members of, have continued to struggle. While unemployment rate has declined, this is partially due to individuals no longer seeking employment. At same time, wages have not increased at a competitive pace. remains committed to assisting those members so that y may keep ir homes or ir autos. continued to offer many above market rates in both money market accounts and certificates of deposits in 2014. Overall annual deposit growth was below historic averages at 1.2%, partly due to significant growth in stock market. s year end capital ratio of 9.25% remains well above 7.00% ratio that is considered to be a Well Capitalized credit union. This strong capital ratio allows to continue to improve upon services that we provide, such as June of 2014 opening of a new full service office in Woodstock, NY and an updated Call Center in July of 2014. Market rates have remained at historic lows since 2008, diminishing net interest margin that has historically recognized. Through active management and monitoring of credit unions financial position, we remain a safe and sound financial institution. We are committed to you, our member, and will continue to offer you products and services that you desire in a safe and sound manner. Joseph Marino Treasurer Christopher Corallo SVP and Chief Financial Officer
Financial Charts Members Equity 2014 Shares 695.1 2014 67.5 2013 686.8 2013 63.2 2012 678.8 2012 68.6 2011 67.5 2011 653.6 2010 2009 59.6 64.7 2010 626.5 $ in Millions 2009 593.7 $ in Millions Net Loans assets 2014 794.4 2014 487.6 2013 769.2 2013 458.2 2012 457.6 2012 759.3 2011 457.8 2011 731.3 2010 455.3 2009 453.6 $ in Millions 2010 698.9 2009 662.5 $ in Millions
Board of Directors Gary Anderson Chairman Joseph Marino Treasurer Stephen Swanson Secretary Angelo Fasano 1st Vice Chairman Supervisory Committee Robert Pfeiffer, Chairman Elizabeth Carr Kevin Dorney Senior Management Team Wayne Winkler President and CEO Patti Osterhoudt Senior Vice President/COO Christopher Corallo Senior Vice President/CFO Jill Hall VP/ Controller David Perry VP Branch Operations Jessica Fox VP Risk Management
John Kelly 2nd Vice Chairman Elizabeth Carr Thomas Fox William Ryan Roger Miller Directors Emeritus Joseph T. Aiello Frederick W. Bell Gordon L. Craw Frank R. Jankowski Norman E. Nitschke Paul A. Pavlovich Robert Michaud Senior Vice President/CMO David Kellogg VP/CTO Stephen Carle Senior Vice President/CLO John Dwyer VP Business Services Judy Hamilton VP Human Resources
Mid-Hudson Valley Federal Credit Union Consolidated Statements of Financial Condition For years ended December 31, 2014 and 2013 (Dollar amounts in thousands) Financials Assets 2014 2013 Cash and cash equivalents $ 48,739 $ 40,492 Securities available for sale 201,179 217,153 Loans held for sale 2,585 1,960 Loans, net of allowance of $3,946 and $4,340 487,617 458,178 Accrued interest receivable 2,307 2,339 Federal Home Loan Bank stock, at cost 1,432 1,149 Loan servicing rights 1,508 1,750 Investment in life insurance 8,846 8,596 Real estate owned, net 2,045 819 Premises and equipment, net 23,983 24,280 NCUSIF deposit 6,690 6,711 Or assets 7,493 5,794 TOTAL Assets $ 794,424 $ 769,221 Liabilities and Members' Equity Liabilities Members share accounts Non-interest bearing $ 77,829 $ 77,632 Interest bearing 617,314 609,204 Borrowed funds 19,500 9,500 Accrued expenses and or liabilities 12,309 9,726 TOTAL Liabilities 726,952 706,062 Members Equity Statutory reserve, restricted 12,446 12,446 Undivided earnings 61,059 59,654 Accumulated or comprehensive loss -6,033-8,941 TOTAL Members Equity 67,472 63,159 TOTAL Liabilities and Members Equity $ 794,424 $ 769,221
Mid-Hudson Valley Federal Credit Union Consolidated Statements of Operations For years ended December 31, 2014 and 2013 (Dollar amounts in thousands) Financials Interest Income 2014 2013 Loans, including fees $ 23,019 $ 23,575 Securities 3,386 3,196 Or 69 61 TOTAL Interest Income 26,474 26,832 Interest Expense Members' share accounts 3,228 3,454 Borrowed funds 109 4 TOTAL Interest Expense 3,337 3,458 Net interest income 23,137 23,374 Provision for loan losses 2,483 3,328 Net interest income after provision for loan losses 20,654 20,046 Non-Interest Income Service fees and charges 7,175 6,517 Net gains on sale of loans 376 1,157 Net gains on sale of securities 162 470 Or 1,157 1,440 TOTAL Non-Interest Income 8,870 9,584 Non-Interest Expense Salary and employee benefits 13,427 13,083 Occupancy and equipment 7,226 6,622 Outside services 4,709 5,087 NCUSIF assessments 142 709 Or 2,615 2,803 TOTAL Non-Interest Expense 28,119 28,304 Net Income $ 1,405 $ 1,326
Mid-Hudson Valley Federal Credit Union Consolidated Statements of Changes in Members Equity For years ended December 31, 2014 and 2013 (Dollar amounts in thousands) Financials Accumulated Statutory or Reserve, Undivided comprehensive Restricted earnings LOss total Balance, January 1, 2013 $ 12,446 $ 58,328 $ -2,222 $ 68,552 Comprehensive income: Net income - 1,326-1,326 Or comprehensive loss - - -6,719-6,719 Balance, December 31, 2013 12,446 59,654-8,941 63,159 Comprehensive income: Net income - 1,405-1,405 Or comprehensive income - - 2,908 2,908 Balance, December 31, 2014 $ 12,446 $ 61,059 $ -6,033 $ 67,472
Supervisory Report Member volunteers are at heart of any credit union and work closely with management to provide direction for success and oversee practices to ensure safety and soundness of Mid-Hudson Valley Federal Credit Union. The Supervisory Committee consists of member volunteers, appointed by Board of Directors, who are responsible for independent oversight of s operational and financial policies and practices. We are dedicated to ensuring overall safety and soundness of our credit union through auditing of its policies and practices, by protecting assets of our membership, guaranteeing compliance with all financial regulations and monitoring for accurate financial reporting. We n report our independent findings to Management Team and Board of Directors. The Supervisory Committee also makes itself available to provide assistance with member concerns. As part of its supervisory role, committee engages an independent accounting firm to conduct an ongoing internal audit program of policies and operations. This ensures that proper controls are in place and are followed to protect member assets. We meet regularly with accounting firm to set scope of audits and review results of those audits. As needed, we also meet with management to review responses to audit findings. During 2014, Supervisory Committee oversaw auditing of thirteen different operational areas (including consumer loans, member business loans, and accounting) and reviewed nineteen internal audit reports that were issued. We also reviewed more than forty internal operating policies. The Supervisory Committee worked, as needed, with examination team from National Credit Union Administration (NCUA) during its annual review of s operations. Anor important responsibility of Supervisory Committee is to oversee an annual audit of s finances. In 2014, we engaged accounting firm of Crowe Horwath, LLP to conduct an external audit of s consolidated financial statements. The results of Supervisory Committee s internal audit program, annual NCUA examination results, and independent audit of consolidated financial statements lead committee to conclude that Mid-Hudson Valley Federal Credit Union continues to be a strong financial institution that is well managed, safe, and secure. I would like to thank staff and management for ir assistance and cooperation during past year and Board of Directors for ir support of our mission. And, finally I would like to express my deep appreciation for or volunteers on Supervisory Committee. They have shown dedication and integrity in all of ir efforts to serve and its membership. Robert PFeiffer Chairman, Supervisory Committee
Employee Honors Chairman s Award for Talent M i c h a e l c am p b e l l Cindi deolde Doug Winrow K e l l y C h e r ma k W o w - E A wa r d Pa t January Bonnie M a r c h Pa t t y J u l y A dam June Rebecca M ay G e o r g e n e A p r i l Fa b i a n February Ruben Au g u s t Dav e S e p t e m b e r Pa t O c t o b e r C r y s ta l N o v e m b e r Pa t r i c i a December Michael
JUNE 24, 2014 85 Mill Hill Road Woodstock, NY 12498 grand opening
A Renovated and Repurposed Historic 1934 English Gate House We increased our commitment to village of Woodstock by relocating our storefront office to a larger, new 3,500 square foot facility. In this unique building project, we were able to renovate and repurpose a historic 1934 English Gate House that was cherished by local community. The new branch now provides convenience of on-site parking and extended hours of service.
In 2014, donated over $85,000 to over 191 local charitable organizations. Kingston Relay for Life Campaign This past year raised $17,754 for Relay for Life to benefit American Cancer Society. With additional support of local community has donated over $250,000 to Relay for Life over past 17 years.
ALS Ice Bucket Challenge Our staff participated in ALS Ice Bucket Challenge on August 19, 2014 at Credit Union Center raising over $800 for ALS Association. In addition to corporate and employee donations of over $300, pledged to donate an additional $1 per shared Facebook post of its Ice Bucket Challenge video, up to $500. The video posted on Facebook received over 1,500 views and 640 shares in under 24 hours. s unique take on Ice Bucket Challenge provided a quick lesson on ALS, as each employee recited a brief fact about disease before being dumped with ice water. was originally challenged to ALS Ice Bucket Challenge by Bridgeway Federal Credit Union. Juvenile Diabetes Research Foundation The employee team was again awarded title top team in Ulster County raising a total of $21,101 for 2014. Feed veterans As part of Catskill/Hudson Chapter of New York Credit Union Association, partnered with or local credit unions for annual Feed Vets Food Drive. The local credit unions received over $11,500 worth of non-perishable food items and monetary donations from community to benefit food pantry at Castle Point Veteran Hospital. Ulster County SPCA Credit Union Center staff held a fundraiser to benefit Ulster SPCA. Their efforts resulted in $2,000 in funds and donations of pet food and supplies.
20 1 Annual Report in closing Credit Union Center 1099 Morton Boulevard PO Box 1429 Kingston, NY 12402 845.336.4444 FCU.com We set foundation in 2014 for furr improvements in our technology that will save you time and money, and provide for a better electronic banking experience. Look out for Mobile Check Deposit, e-docs electronic documents, and a fresh, new FCU.com website in early 2015. Federally Insured by NCUA