2018 ANNUAL REPORT F I REF LY C R EDIT U N IO NÂ®
Contents Report of the Board Chair & President/CEO ........................ 4 Report of the Supervisory Committee.................................. 6 Financial Statements ............................................................. 8 Delivering a Valuable Membership Our Commitment to Member Value...................................... 10 Inspiring Bright Financial Futures Our Commitment to Education.............................................. 12 Protecting Members With Tools & Resources Our Commitment to Security................................................. 14 Supporting Our Neighbors Our Commitment to the Community.................................... 16 Celebrating Our Team ............................................................. 18
2018 ANNUAL REPORT F I REF LY C R EDIT U N IO NÂ®
REPORT OF THE BOARD CHAIR & PRESIDENT/CEO Founded in 1925, Firefly was the very first credit union in Minnesota. While many things have changed in the last 94 years, our mission and values have remained the same. As a not-for-profit financial cooperative, Firefly is committed to your financial well-being and your goals – in fact, we exist to help you reach them. As we look back on the past year, we reflect on a year of growth and change. In 2018, Firefly welcomed nearly 9,000 new members, gained over $92 million in assets and provided exciting new products and services to our members, including an all new digital banking experience. This growth is also reflected in our commitment to member value and we are proud to report that our entire membership saved over $27 million last year, simply by choosing Firefly as their financial partner. With new leadership driving us forward, we are excited to see what we can accomplish in the years to come. Throughout this report, we’ve highlighted more ways in which Firefly has invested in our membership and community over the past year with our commitment to financial education, charitable giveback and enhancements to member security. Now one of the largest credit unions in Minnesota, Firefly has been there for every chapter of your life. From your first auto loan all the way through retirement, we guide you with helpful resources to fit your needs. We look forward to growing our relationship with you – our member owners – and adapting to support your changing needs.
Sarah Lietz Board Chair 4
Dale Turner President/CEO
Volunteer Board of Directors Anne Ziebell Board Vice Chair
Evelyn Jones Director
Kevin Crane Associate Director
Kristine Ziccardi Board Secretary
Brian Kadlec Director
Lorrie Oelkers Associate Director
Pat Kaiser Board Treasurer
Gary Rippie Director
Bruce Whitmore Associate Director
Ryan Harrison Director
James Sackett Director
Sarah Lietz Board Chair
Executive Management Team Leon Eichten SVP/Chief Financial Officer Cole Hahn SVP/Chief Administration Officer Marty Kelly SVP/Chief Marketing Officer Rajan Odayar SVP/Chief Technology Officer
Dale Turner President/Chief Executive Officer
REPORT OF THE SUPERVISORY COMMITTEE Supervisory Committee Teena Buenviaje-Liu Committee Member Bob Larson Committee Member
Jill Jackson Gill Supervisory Committee Chair
From banks to credit card companies to mortgage brokers, we are repeatedly told how much businesses care about their customers, but how many of these institutions can claim that their foundation â€“ their very reason for being â€“ is their members? That uniqueness is what makes your credit union different. While other financial institutions speak to service, they are still first and foremost motivated by profit. As a not-for-profit financial cooperative, your credit union is motivated by something very different: You. It comes down to ownership. Firefly Credit Union is owned by members, who are simply those individuals that choose to do business with us. These everyday people voluntarily serve on our Board of Directors and Supervisory Committee and strategically guide the credit union to ensure we continually meet our mission of member service. 6
EXTERNAL OVERSIGHT A financial audit by CliftonLarsonAllen® LLP and an examination by the NCUA provided reasonable assurance on our financial condition and management of risk.
Your Supervisory Committee plays a key part in the process – our primary function is to regularly audit all facets of the credit union, including financial management, administrative, and operational practices. We rely on unbiased third-parties, including CliftonLarsonAllen® LLP and the National Credit Union Administration (NCUA), in addition to our internal team of dedicated risk management staff, including auditors and a compliance specialist, to assess these areas and keep your financial safety and security top-of-mind to avoid potential discord. During 2018, we engaged in a number of practices; each used to ensure we continue to guide our members toward lifelong financial well-being.
INTERNAL AUDITS Regular audits of operational and technical areas provided a reasonable assurance of how efficiently, effectively and securely we’re serving you.
As the Supervisory Committee Chair, I am very pleased to report that all audits conducted in 2018 yielded no significant deficiencies. Rest assured knowing your credit union is committed to operating with sound financial, operational and security practices. MEMBER FEEDBACK
Jill Jackson Gill Supervisory Committee Chair
Member surveys and online reviews provided us with important feedback used to improve our service initiatives.
STATEME N T S OF F I N A N CI A L CO ND I T I O N AS OF D EC EMB E R 3 1, 2 0 1 8 A N D 201 7
A SSETS Cash and Cash Equivalents
Deposits in Other Financial Institutions Securities – Available-for-Sale Loans, Net Accrued Interest Receivable
Foreclosed and Repossessed Assets Premises and Equipment, Net
Credit Union Owned Life Insurance
L IABIL ITIES & MEMBER S ’ EQU I T Y: L IABIL ITIES Members’ Share and Savings Accounts Accrued Expenses and Other Liabilities TOTAL LIABILITIES
M EMBERS’ EQU ITY Regular Reserves Undivided Earnings Accumulated Other Comprehensive Income (Loss) TOTAL MEMBERS’ EQUITY TOTAL LIABILITIES AND MEMBERS’ EQUITY
TOTA L ASSETS
$1 .28 B
$ 1 .1 9 B $1 .1 3 B
NET WO RT H R AT I O
20 1 8
20 1 7 20 1 6
9. 87% 9. 76%
STATEMEN T S OF I N COM E FO R T H E Y E A R S ENDING D EC EMB E R 3 1, 2 0 1 8 A N D 201 7
INTE REST IN COME Loans
Securities and Interest Bearing Deposits TOTAL INTEREST INCOME
INTE REST EXPEN S E Membersâ€™ Share and Savings Accounts and Notes Payable NET INTEREST INCOME PROVISION FOR LOAN LOSSES NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES NON-INTER EST IN COME Other Non-Interest Income Service Charges and Fees TOTAL NON-INTEREST INCOME NON-INTER EST EXPEN S ES General and Administrative: Employee Compensation and Benefits
Office Occupancy and Operations
Other Operating Expenses
Net Gain on Sale of Assets TOTAL NON-INTEREST EXPENSE
TOTA L M E M B E R S
TOTAL D EPOSITS 2018
$1 .1 4 B
$ 1 .0 6 B $0.99B
20 1 8
79, 5 64
20 1 7 20 1 6
76, 05 2 73, 45 3
DELIVERING A VALUABLE MEMBERSHIP: Fireflyâ€™s Commitment to Member Value. When it comes to the value of a Firefly membership, you can expect more. We work to help you reach your financial goals by providing value in products and services, information and resources. Here are a few ways Firefly members received value in 2018: Our entire membership saved over $27 million* simply by choosing Firefly as their financial partner over leading banks. This equates to an average member savings of $403 and more cash in your pocket all year long. Plus, members with three or more unique products saved even more, an average of $607. We remodeled our existing Burnsville and Fridley branch locations, and started construction on our Brooklyn Park location, to better serve our membersâ€™ needs and
align with our branch prototype design. The remodeled locations feature many new enhancements including an open, modern environment, a check-in kiosk to serve you faster, a tech bar for quick, convenient access to information on membership and accounts and a refreshment bar for visitors. Firefly launched a number of new products and services in 2018, including the ability to access your credit score for free within digital banking. Plus with the release of our new Adoption Loan, Firefly is supporting growing families with an unsecured, fixed-rate line of credit that can be used to fund up to 90% of adoption expenses. We are proud to report that over a dozen families have taken advantage of this new product.
IN VALUE RECEIVED BY MEMBERS IN 2018
With our continued partnerships, you have access to exclusive money-saving benefits and discounts, just for being a Firefly member. Enjoy rate discounts, cash back rewards, financial education, insurance discounts, scholarship opportunities and more from a number of our partnering companies including Enterprise® Car Sales, Sprint™, Lutheran Social Service of Minnesota (LSS) and TruStage™.
FAMILIES GROWN THROUGH ADOPTION
As your financial needs evolve with every stage of life, you can count on Firefly to bring more value to your membership with new products and solutions to help guide you on your journey to financial well-being.
* Average member savings is an estimate of projected annual savings based on the difference between current Firefly rates and fees and the average rates and fees of comparable products and services at leading financial institutions in our local Minnesota market as of 10/29/18 as reported by Informa Research Services, Inc. Savings example is for illustration purposes only. Not all members have experienced or will experience savings. For complete details, visit fireflycu.org/value.
IN MEMBER DEBT REDUCED WITH LSS
INSPIRING BRIGHT FINANCIAL FUTURES: Firefly’s Commitment to Education. Your finances are one of the most important assets in your life, so when it comes to financial literacy, the more you know – the more you can achieve. Firefly makes it a priority to educate our members, and those throughout the Greater Twin Cities CommunitySM, on a variety of topics, through many different channels.
blog where we share smart, reliable resources and help readers gain insight on everything from preparing for a mortgage down payment to maximizing your tax refund. Additionally, we started appearing on-air at a local radio station to deliver financial advice and answer personal financial questions, in a segment called “Money Monday” on Go 96.3.
In 2018, Firefly implemented two educational initiatives. Firefly released an educational
In addition to our new financial education efforts, Firefly was also honored with two
JUNIOR ACHIEVEMENT LESSONS TAUGHT
ATTENDEES AT EDUCATIONAL EVENTS
IN SCHOLARSHIPS AWARDED first-place statewide awards from the Minnesota Credit Union Network for the Adult and Youth divisions of the Desjardins Financial Education Award. These awards recognized our financial education partnerships with local businesses and Burnsville High School, respectively. Firefly went on to receive the second-place national Desjardins Adult Financial Education Award from the Credit Union National Association.
EDUCATED FROM FIREFLYâ€™S BLOG
PROTECTING MEMBERS WITH TOOLS AND RESOURCES: Fireflyâ€™s Commitment to Member Security. Firefly is committed to investing in solutions that enhance the safeguarding of member data and protect our members from identity theft and fraud. Through educational workshops, card management solutions, online resources and more, Firefly is always focused on making security a top priority for members and employees.
Over the past year, Firefly held two Fraud Prevention seminars with experts from the Minnesota Department of Commerce. Members had the opportunity to share stories and ask one-on-one questions. We also converted to a new digital banking platform, where members can set alerts for account activity, receive online statements, transfer money and pay bills conveniently and securely. Plus, Firefly makes it easy to
SECURLOCK TM EQUIP USERS
ATTENDEES AT FRAUD PREVENTION EVENTS
MEMBERS ENROLLED IN eSTATEMENTS manage your credit and debit cards on-the-go with help from SecurLOCK™ Equip – an app that allows you to turn your card on or off, monitor transactions, and set spending parameters, right from your phone. In addition to these money management tools and resources, Firefly will continue to share helpful tips and information on our website, social media platforms and in our newsletters to ensure you can stay educated on identity theft and fraud.
POUNDS OF PAPER SECURELY SHRED
SUPPORTING OUR NEIGHBORS: Firefly’s Commitment to the Community. Firefly is dedicated to giving back to our members and community. Every year, employees embrace the credit union philosophy of “People Helping People” and participate in a variety of charitable activities. Some of the many organizations we partnered with in 2018 include American Cancer Society, Gillette Children’s Hospital, Feed My Starving Children and The Firefly Sisterhood. Last year, Firefly hosted a volunteer fair where a variety of local organizations had 16
the opportunity to share the background of their organization and personal stories from the individuals they’ve impacted. Employees had the chance to learn more about each organization and make donations. Firefly employees have continuously shown their support to the community far outside the realm of financial services. As we reflect back on the past year’s events, 2018 has proven to be one of our most generous years. Firefly will continue to share our support
LIVES SAVED THROUGH BLOOD DONATION
SUPPLIES GIVEN TO LOCAL SCHOOLS
DONATED TO LOCAL CAUSES for years to come and help create brighter futures for our members and community.
I am amazed by the generosity of our employees and feel very proud as I look back on the past yearâ€™s volunteer efforts. - Firefly President/CEO Dale Turner
MEALS PREPPED BY FIREFLY EMPLOYEES
CELEBRATING OUR TEAM Shining Star Employees awarded a Shining Star have stepped up to a level of service outside of their job description by providing exceptional service to members, co-workers and the credit union as a whole. They are entered into the nominations for Employee of the Year.
2018 EMPLOYEE OF THE YEAR NOMINEES: Jake Asmussen Lori Cosgrove DeeDee Ford Allison Hagen Bonnie Nerison
Drew Perez Andy Russell Brandon Sauer Janna Vang Member Service Department
Andy Russell 2018 Employee of the Year
Congratulations to Andy Russell on being named the 2018 Employee of the Year. As the Digital Service Support Manager in our Member Service Center, Andy supports our members and staff through the use of our digital banking solutions. Andy was selected as the winner for his role in the conversion of our digital banking platform. Through hard work and dedication, he continues to serve as an outstanding leader to his team and coworkers, and demonstrates Fireflyâ€™s Core Values each and every day. Thank you, Andy!
2018 Core Value Award Recipients Firefly’s core values of Respect, Adaptability, Hard Work, and Collaboration & Teamwork are the driving force of our organization, helping us live out our mission of guiding our members toward financial well-being. The following employees have been recognized with the respective core value awards by their peers for exemplifying the value in action each and every day at Firefly:
2018 CORE VALUE AWARD RECIPIENTS: Kate Alter - Adaptability Find the “yes” in every situation.
Serena Mullen - Collaboration & Teamwork Be accountable for what you do.
Seth Larson - Hard Work Make a positive difference every day.
Andy Russell - Respect Earn the trust of others.
2018 CUES Distinguished Director Firefly is proud to announce James Sackett, Firefly Board Director, was named the 2018 Credit Union Executive Society (CUES) Distinguished Director award winner. This award honors strong, CUES member volunteers whose achievements have strengthened their credit union through new and innovative ways.
Firefly Locations BLOOMINGTON 2772 East 82nd Street Bloomington, MN 55425 BROOKLYN PARK 5703 100th Avenue North Brooklyn Park, MN 55443 BURNSVILLE 1400 Riverwood Drive Burnsville, MN 55337 CHANHASSEN 7905 Great Plains Boulevard Chanhassen, MN 55317 FRIDLEY 6303 Central Avenue Northeast Fridley, MN 55432 LAKEVILLE 17533 Cedar Avenue Lakeville, MN 55044 MAPLE GROVE 11121 Fountains Drive Maple Grove, MN 55369 MINNEAPOLIS 2535 27th Avenue South Minneapolis, MN 55406 SHAKOPEE 4290 Dean Lakes Boulevard Shakopee, MN 55379
Equal Housing Lender. Federally insured by NCUA. President/CEO photo credit to Lindsay Miller Photography.