Going Forward — 2022 Annual Report from Elements Financial

GROWING FORWARD 2022 Annual Report from Elements Financial

A Letter from Our Leadership Since 1930, our credit union has met the financial needs of our members. Already in 2023, we’ve experienced a changing economic environment which has impacted everyone. As we look back on 2022, we are here to reaffirm our commitment to financial wellness education, our solid financial position, and our signature service.

We continue to focus on and perform strongly in these areas: • Financial Wellness. Elements proudly serves more than 100,000 members and oversees $2.2 billion in assets that they’ve entrusted to us. Our purpose is to empower them to achieve financial success • Safety & Soundness. We maintain capital levels significantly beyond the requirements for a well-capitalized rating from our regulators. Elements also maintains a focus on managing risk.

With diversified deposits, Elements maintains robust cash reserves, borrowing capacity, and investments.

• A Time-Tested History of Service. Since our founding in 1930 during the Great Depression, our business has been built with a responsible approach, focusing on the core elements of financial services. We have sustained success through a variety of economic and interest rate environments, and we look forward to serving our members long into the future.

Important to our mission-driven work, we believe in our communities and partner with a range of organizations that serve our neighbors in need. We also advocate through both state and national organizations to ensure your credit union benefits are supported through legislation.

Together with members and the community, Elements grows forward!

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Whitney Anderson President & CEO

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Mark Saltsgaver Chair of the Board

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Thank you for your loyal business,

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FINANCIAL GROWTH 2021

2022

Growth

% Growth

LOANS

$1,307,686,971

$1,567,203,850

$259,516,879

19.85%

DEPOSITS

$1,731,119,958

$1,824,974,505

$93,854,547

5.42%

• Broad growth in lending was driven largely by Commercial, Auto, and Mortgage.

• Success in deposits came from certificates growing by 67%; High Interest Checking adding 2,900+ new accounts; and the Helium Savings Account adding balances above $70 million.

FINANCIAL WELLNESS

800 6,000 Workshops

Participants

NEW RELATIONSHIPS

9 4,200

Employer Partners Potential Members

The Villages of Indiana | Networks Connect | Genesys Cloud Services FusionSoft, LLC | Village of Merici | Indiana Hemophilia & Thrombosis Center Westminster Village North | EmployIndy | Casted, Inc.

PAYMENTS, DIGITAL & TECH 2022

% Growth

TOTAL LOGINS

8,423,187

28%

TRANSACTIONS* PROCESSED (#)

1,169,149

31%

TRANSACTIONS* PROCESSED ($)

$1,973,488,324

28%

78,354

31%

ZELLE® P2P PAYMENTS

• Applied necessary security patches, replaced firewalls, and migrated servers to fully protect member information • Ongoing phishing and fraud awareness to inform both members and employees

*Includes Funds Transfer, External Transfer, Remote Deposit, ACH Payments

LENDING UPDATES MORTGAGE

COMMERCIAL LENDING

DEBIT & CREDIT CARDS

As the #1 credit union and #2 financial institution* in the Indianapolis market for conventional purchase transactions, the Elements Mortgage Program continued to be popular.

Thank you for trusting Elements to make your purchases possible.

This area of the credit union grew in multiple ways, including expansion of the team itself, while maintaining 0% delinquency and charge-offs.

9.6/10

$509,000,000

$120,000,000

1,217

9,000,000

$43,000,000

Overall Net Promoter Score

Home Equity Lines of Credit Funded

in Total Spending

Total Transactions

in Commercial Loan Balances

in Commercial Deposit Balances

*Source: Mortgage Data Web/January-November 2022

MEMBER EXPERIENCE

135,969 Contact Center Calls

20,568

Member Service Emails

22.5% YOY INCREASE IN BRANCH TRANSACTIONS Across every branch at Lilly Corporate Center, Lilly Technology Center, the Indiana Government Center, and the Indiana Farm Bureau Building, we served more members in-person.

450 APPOINTMENTS SCHEDULED ONLINE A new online scheduling system led to a significant increase in member interactions within our branches and other areas of the credit union.

628 HSA INVESTMENT ACCOUNTS CONVERTED A new DriveWealth platform provided new funds management options to members. Benefits include self-directed investing; a curated funds list; or an account managed by a brokerage.

5 DAYS SHAVED FROM MORTGAGE APP PROCESS The transition to a new system called Encompass for first mortgage loans improved loan funding and accounting efficiencies; made relevant data more accessible; and eliminated manual processes such as updating spreadsheets.

13,200 Live Chats

9,514

Online Deposit Apps

8,441

Mail Deposits /Payments

462,000 12,793 Bill Payments

Wire Transfers

ELEMENTS CARES COMMUNITY IMPACT

1,200

Committed to our community, Elements gives of our time, talent, and/or treasure to a range of partners that include the following: Art Mix | Brightlane Learning | Central Indiana Police Foundation

hours of volunteer time donated by our employees on the 6th Annual Purpose Day, our event dedicated to giving back to the community

DREAM Alive | Firefly Children and Family Alliance | Indianapolis Indians Charities Indy Black Professionals | Little Red Door | NeighborLink | Outreach, Inc. Providence Cristo Rey High School | Sea Scope | TeenWorks | United Way of Central Indiana

4,910

Employee Lessons Completed Online

HR & TALENT MANAGEMENT

31

Employee Training Events

489

Employee Attendees at Training Events (In-Person and Virtual)

• Wellness Awards included the Indiana Wellness Council – AchieveWELL 5 Star Designation (3rd year); Healthiest Employer – 4th in the State; and American Heart Association’s Gold Recognition for a Culture of Health and Well-Being • 99% of employees have logged into our Wellness Portal with 71% logging points.

• A variety of activities and events offered including: Wellness Weeks, March Madness Step Contest, Heart Walk, and Flu Shot Fall Challenge • Presenting sponsor for trueU’s Day of Belonging with two employee representatives serving on trueU’s DEIB Advisory Committee • Created a DEIB guide for hiring teams and added DEIB-focused questions and language into the interview process • Continued the Leadership Lab internal professional development program, which includes the well-known Dale Carnegie interpersonal communications course • Sent 134 employee attendees to 41 trueU events, including a Women’s Conference and leadership programs; employees also used the trueU portal for self-guided, on-demand learning sessions at a high frequency.

Consolidated Statement of Financial Condition Selected Data in Millions

Assets

2022

2021

Cash and Investments

$661.9

$707.7

Loans to Members

1,567.2

1,307.7

Allowance for Loan Losses

(12.8)

(11.5)

Other Assets

73.3

69.9

Total Assets

$2,289.6

$2,073.8

Liabilities and Members’ Equity Share Savings, Drafts, and Certificates

Mark Saltsgaver Chair

Julie Dunlap Vice Chair

Donald Zakrowski $1,825.0

$1,731.1

Other Liabilities

332.7

141.0

Members’ Equity

131.9

201.6

$2,289.6

$2,073.8

Net Worth Ratio

9.32%

9.79%

Risk Based Capital

15.43%

Total Liabilities and Members’ Equity

Board of Directors

Secretary

John Huesing Treasurer

Mark Andersen Jeremy Fitch Alice Morical Jody Roudebush

NCUA Net Worth Ratio of 7% or above is considered “Well Capitalized” and NCUA Risk Based Capital of 10% or above is considered “Well Capitalized”

Consolidated Statement of Income

Kelly Wiggins-Payne

Selected Data in Millions

2022

2021

Interest Income from Loans and Investments

$67.1

$53.9

Interest Expense on Member Accounts and Borrowed Funds

(20.0)

(11.4)

Loan Loss Provision

(2.1)

(0.8)

Net Interest Income

45.0

41.7

Other Income

18.9

22.6

Operating Expense

(49.2)

(49.4)

Non-Operating Income / (Expense)

(4.5)

4.6

Ben Clark

Net Income

$10.2

$19.5

David Pugh

In management’s opinion, the selected financial data presented herein is free of material error and accurately reflects the financial position and/or results of operations of Elements Financial for the periods presented. Members may request a complete copy of our audited financial statements by calling (800) 621-2105. A credit union must have a Net Worth to Assets ratio of at least 7.00% to be considered “Well Capitalized” by the National Credit Union Administration (NCUA).

Supervisory Committee Beth Goines

Committee Chair

Michele Sawyer Daryl Soughan

LIKE A BANK, ONLY BETTER. 225 South East Street, Suite 300 | Indianapolis, IN 46202 (800) 621-2105 | Get started at elements.org

Federally Insured by NCUA