2023 Annual Report- First Community Credit Union

Annual

Report

2023

Agenda March 18, 2024 | 5:30 PM Farmers Union Conference Center | Jamestown

Call to Order Invocation Introductions Report of Registration Minutes of Previous Meetings Financial Report Report of the President Old Business New Business Report of Nominating Committee Adjourned Drawing of Prizes Meal Served The Annual Meeting is governed by Robert’s Rules of Order.

Annual Meeting Minutes March 20, 2023 The 84th Annual Meeting of First Community Credit Union was held on Monday, March 20, 2023 at the Farmers Union Conference Center.

Chair Owen Olson called the meeting to order at 5:30 p.m. Nicole Heinle gave the invocation.

Chair Olson introduced the head table and invited Director Doug Kalianoff to introduce the Audit Committee. Steve Schmitz, CEO, reported who serves on the First Community Scholarships LLC Board.

The report of registration showed 81 members and 9 guests, constituting a quorum.

A motion carried to approve the minutes of the March 15, 2022, Annual Meeting as printed in the brochure.

Chair Olson provided the report of the Board of Directors.

Sean Rinkenberger, CFO, reviewed the Statement of Financial Condition as of December 31, 2022. A motion carried to approve the report as presented.

Steve Schmitz provided the report of the President. He reported FCCU has had continued financial strength. The regulatory net worth stands at nearly 13% or over $155 million dollars, putting FCCU in the top 12% of all the largest credit unions in the country. He noted FCCU is a well-diversified credit union spreading risk out as wide as possible. Of the $850 million dollars in loans, roughly 1/3 is in agriculture, 1/3 commercial and 1/3 consumer loans. It was noted that nearly 90% of all deposits fall within the NCUA Federal Insurance limits and FCCU has averaged a 10% Asset Growth over the past 15 years. Currently, there are 46,000 members who make up our deposit base of nearly $1 billion dollars. He also announced the of approval from the Board of Directors to form a Charitable Donation Account setting aside $5 million to invest back into the communities FCCU serves. This falls in line with the new core values and mission to Strengthen Community by Helping Members Grow and Thrive.

Chair Olson called for Old Business. There was none. Chair Olson called for New Business. There was none.

A motion carried to approve the actions of Management and the Board of Directors for the past year.

Sharman Zachrison, Chair of the Nominating Committee, made known the other committee members Sue Corwin and Scot Nething who were not in attendance.

Introductions of the two incumbent candidates running for the Board of Directors, Colin Wegenast and Sandy Franke were introduced. Chair Olson declared the vacancies be filled by acclamation.

A motion carried to adjourn.

A Message from our President I am excited to bring you the 2023 First

Additionally, consistently improving our

Community Credit Union Annual Report.

digital options will be a major focus for

2023 was another busy year for FCCU, once

FCCU. We are committed to having the

again, witnessing historically high inflation

right mix of personal, in-branch services

with

combating

and combined with the more independent,

this by aggressively increasing interest

online services to ensure every member

rates for the 2nd consecutive year. These

has a choice that works best for them.

the

Federal

Reserve

factors created a stressful and difficult environment for financial institutions, even

As our credit union grows, each of us must

causing two large national banks to fail.

grow as well. We cannot afford to maintain status quo; we cannot afford to rest on past

While this past year was a challenging time,

successes; we need to constantly look for

First Community Credit Union was able to

ways to improve ourselves and the credit

push forward and come out the other side

union, doing things better each year – and

in a strong financial position. With solid net

that’s a difficult ask. But our employees and

income, we also increased our equity, grew

the Board of Directors have consistently

loans by $90 million and had a growth of

stepped up, year after year, and words

nearly $120 million in total assets.

cannot express how appreciative I am of their efforts.

Our commitment to upholding our core values of community, integrity, passion,

And to our members – YOU are the credit

and growth, are what sets FCCU apart.

union and I want to thank you for your

These are important cornerstones for who

continued trust and dedication to FCCU.

we are and what we do. Every decision that

Your commitment to a cooperative model

we make and action that we take needs

for a financial institution and willingness to

to support these core values. They can’t

be part of something bigger has allowed

just be a quote on the wall, we must be

us to grow and build the credit union to

committed to live them every day.

where it is.

Looking ahead into 2024, growth will be a

Thank you for your membership; we look

continued focus. If we aren’t consistently

forward to serving you for years to come.

growing, we will not be able to continue meeting the needs of our members into the future, so we have to keep moving FCCU forward. A highlight we expect to see in 2024 includes the completion of our new Moorhead, MN branch, set to open late summer. We currently serve many members from Moorhead, so we are thrilled to open a more convenient branch not only for them, but for future members as well.

Steve Schmitz, President & CEO First Community Credit Union

2023

Year in Review First Annual Day of Service FCCU staff held our first annual Day of Service in May of 2023. The FCCU Day of Service was created as a way to give staff the opportunity work together to exemplify our brand promise, “Life is Better with Community” and also our core value of commitment to community.

With nearly all of FCCU’s employees volunteering, more than 260 combined staff hours were accumulated during this time.

There were a variety of clean-up projects at a school, museum, horse arena, post office grounds, other city sites, parks, ball fields and highway ditches in Bismarck, Crookston, Jamestown, Page, Kindred, Wahpeton, Hankinson, Milnor, Napoleon, Oakes, Portland, Steele, St. John, Valley City, Wishek and Grand Forks. Additional activities consisted of clean-up of community gardens and flower planting, assembling May Day and hygiene baskets, a nail booth and art project for Jamestown senior center residents, meal prep, baking and cleaning at Fargo’s Ronald McDonald House and time spent volunteering at the Devils Lake Hope Center.

Moorhead Groundbreaking In

May,

we

held

ceremony

for

Moorhead,

MN.

our

the

groundbreaking

newest

branch

Construction

is

in well

underway and has been going smoothly. Set to open in late summer or early fall of 2024, the branch will be located on 34th St S. in Moorhead.

The new facility will be 4,818 square feet in size and will feature four offices, a complete lobby and teller line with a vaulted ceiling, a break room, a secure work room and two drive up lanes with an ATM. The stone and steel building will be situated next to the busy 34th Street I-94 exit, near Menards and the new Moorhead Schools Career Academy. The branch will be the 3rd Minnesota location for First Community Credit Union, providing a more convenient location for many of our Minnesota members.

Partnership with UND Athletics First Community Credit Union became an exclusive financial partner with University of North Dakota (UND) Athletics. This one-ofa-kind partnership was a huge first for our institution.

With our exclusive UND debit cards, check blanks, online banking and credit cards, the partnership is the first of its kind with FCCU and UND. Additionally, the in-branch events, and advertising opportunities within the Ralph and Betty Engelstad arenas, has offered a great opportunity for not only the credit union, but for our members as well.

Bismarck Ribbon Cutting In August, we held the ribbon cutting for our newly remodeled Bismarck North branch. The branch received a complete interior and exterior remodel and remains at 3201 Weiss Avenue.

The completely redone interior features added offices, brand new flooring and skylights, new cubicles, a new drive-up teller line and more.

FCCU

By the Numbers

MORE THAN

Our community first laid its foundation in Jamestown, ND in 1939 with only 45 members. Over 85 years later, we now have branches across ND & MN, serving over 46,000 members.

$600,000

through donations and sponsorships

$57,000 OVER

in college scholarships

2,600volunteer HOURS

Quarterly

Charities

Every quarter, staff selects local charities and donates

funds, items and time

Community Impact FCCU is proud to not just do business in our communities, but also support them by giving back. We donate money, sponsor various events and organizations, volunteer our time, attend events and the list goes on and on.

Our quarterly charity is a unique way we support important causes in the region.

Since 2014, FCCU employees have chosen an organization each quarter to support by raising money and awareness. The funds are raised through Friday jeans money and other specific activities that relate to the cause. Here’s a look back on the positive impact in 2023.

Continued

Community Impact Q1 Hunger & Poverty Causes FCCU’s first quarter charity was chosen by its members in 2023. Celebrating 40 years of hunger relief, the GFPB operates nine programs to recover and distribute food to combat hunger for children, seniors and those in rural communities. With help from volunteers and donors, their network of 200 partner food pantries, shelters and soup kitchens help to feed those in need across North Dakota and Clay County, Minnesota. FCCU was able to raise $6,500.

Q2 Ronald McDonald & Sunshine Houses During our second quarter, FCCU raised $6,000 total, with $2,000 each going to the Bismarck and Red River Valley Ronald McDonald Houses and the Sunshine Hospitality Home in Grand Forks.

The Ronald McDonald House and the Sunshine Hospitality Home provide a place of comfort for families who must travel when their kids need medical care. Families have a place to rest near medical facilities, receive care and support resources, and connect with other guest families. All provide temporary housing with private rooms and various services. The work of charities like the Ronald McDonald house has helped millions around the globe, including our own FCCU staff.

Q3 American Foundation for Suicide Prevention FCCU chose to support and raise awareness for the American Foundation for Suicide Prevention (AFSP) as our third quarter charity cause. FCCU was able to raise $4,500. FCCU used these funds to sponsor AFSP’s Out of the Darkness Walks in Bismarck, Fargo, Devils Lake, Wahpeton and Valley City. Many of our staff volunteered to help with the walks and participated on our teams. FCCU also donated $500 to the Stutsman County Motorcycle Ride to Silence the Stigma. Additionally, as an added way to raise money, FCCU teamed up with Dakota Dirt Coffee from Milnor, ND to by selling special branded coffee bags.

Q4 Make-A-Wish Foundation With the help of our communities and members, FCCU was able to raise $7,500 to support cancer causes and awareness. With these funds, FCCU was able to grant one wish for a Make-A-Wish child. FCCU was paired with Briley Thompson a 16-year-old from Fargo who has been battling cancer since October 2021. Briley went through many cycles of treatment at Sanford Children’s Hospital in Fargo, challenging both mentally and physically, but is now in remission. Briley’s wish was to go to a tropical island with her best friend.

2023

Awards & Recognition Dora Maxwell Award, National Marketing Award, Best Credit Union by Forbes, and much more!

In 2023, FCCU was recognized by the Dakota Credit Union Association (DakCU) with several awards. Recognized for our community involvement, FCCU was presented the Dora Maxwell award. FCCU received this award for our charity support towards Safe & Homeless Shelters, raising more than $3,000, donating more than 800 pairs of socks and bringing awareness for the organization.

FCCU was also recognized for two marketing awards in the categories of complete campaign and print marketing. The print campaign featured our Mandan history wall which highlights the rich past of both Mandan and FCCU. Members and the public can view this history wall on the third floor of the Mandan branch, outside of the community room.

The second Marketing and Communication Award was for our “Kasasa $2 Million” campaign. The Kasasa $2 Million Campaign was a multifaceted complete campaign, that included various forms of brand

awareness including TV ads, billboards,

focused on business, Forbes annually

mailers, social media giveaways, parade

names the best banks and credit unions

signage, digital and newspaper ads, in-

in each state. Forbes uses marketing

branch posters and handouts, and more.

research firm, Statista, to conduct indepth interviews of thousands from all 50

FCCU also was awarded by the Credit

states on their banking relationships in

Union National Association (CUNA) with

addition to utilizing good reviews.

a Marketing and Business Development Diamond Award. FCCU was awarded for

Finally, FCCU’s very own Amie Aesoph,

the category of “Complete Campaign” for

Chief Human Resource Officer was named

our “Kasasa $2 Million” campaign, as well.

to the Top 25 Women in Business list by Prairie Business Magazine. Recipients

Other recognitions in 2023 include being

were selected through a nomination

selected as one of the Top 50 Best Places

process that emphasized professional

to Work in the region by Prairie Business

achievement, community contributions

for the fourth year in a row and being

and volunteerism.

named one of the Top 10 Best Places to Work by the Young Professionals of Bismarck.

Additionally, FCCU was named North Dakota’s Best in State Credit Union by Forbes in 2023. A global media company

Financial Overview

Statement of Financial Condition ASSETS Loans (Net of allowance) Cash & Investments Property and Equipment Other Assets Total Assets

Dec. 31, 2023 $ 941,240,248 303,801,828 40,029,547 31,719,798

Dec. 31, 2022 $ 859,816,143 266,709,268 39,983,570 29,231,230

$1,316,791,421 $1,195,740,211

LIABILITIES AND EQUITY $15,006,996 145,000,000

$9,444,525 83,500,000

Total Liabilities

160,006,996

92,944,525

Member Shares and Deposits

1,018,855,514

978,000,877

1,178,862,510

1,070,945,402

137,928,911

124,794,809

Accounts Payable Notes Payable

Total Liabilities & Member Deposits EQUITY Total Member Equity Total Liabilities & Equity

$1,316,791,421 $1,195,740,211

Statement of Income INTEREST INCOME

2023

2022

$45,280,583 6,371,651

$34,148,677 4,590,565

51,652,233

38,739,242

Interest Expense Provision for Loan Losses

(16,173,620) (730,000)

(4,186,370) (560,000)

Net Interest Income

34,748,613

33,992,872

Non-Interest Income

14,331,058

13,130,089

$49,079,671

$47,122,961

Compensation and Benefits Operations and Administrative Occupancy

$22,877,265 12,292,479 3,321,125

$22,568,826 11,132,501 2,976,274

Total Expenses

38,490,869

36,677,601

$10,588,802

$10,445,360

Loans Investments Total Interest Income

Total Income EXPENSES

Net Income

Assets

Membership

D

Deposits & Loans Since 2000 Millions

600 500 400

700 600 FCCU

400

300

Deposits

300

200

Loans

200

100

100

2004

2002

2000

2018

2016

2012

2010

2008

2006

2004

0 2002

0

800

500

2000

Millions

Deposits & Loans Since 2000

Executive Management Team

Steve Schmitz President & CEO

Sean Rinkenberger Chief Financial Officer

Stephanie Finck Chief Operations Officer

Craig Grundstrom Chief Development Officer

Darin Finck Chief Lending Officer

James Vollrath Chief Technology Officer

Amie Aesoph Chief Human Resources Officer

Steve Davis Senior VP, Mortgage

Janna Bergstedt Chief Marketing Officer

Branch Management

Zachary Dosch Bismarck Market President

Chris Howell Fargo Market President

Heather Johnson Lake Region Market President

Derek Holt Grand Forks Market President

Alysa Barth Director of Retail Sales & Development

2023

Board & Supervisory

Bonnie Nelson Elected in 2012

Chris Aarhus Appointed in 2023

Colin Wegenast Elected in 2011

Doug Kalianoff Elected in 2022

Mark Watne Elected in 2013

Owen Olson Elected in 2004

Sharman Zachrison Elected in 2012

Audit Committee Nominating Committee Colin Wegenast Scot Nething Sue Corwin

Doug Kalianoff Scot Nething Rodney Buck

Board Report Welcome to the 85th annual meeting of First Community Credit Union. We are deeply grateful for your ongoing patronage and loyalty to our credit union family. Your trust and support mean the world to us, inspiring us to go above and beyond in serving you.

The credit union ended 2023 with assets of $1,316,791,421 with net income coming in at $10,588,802. We had an increase in membership, which now stands at 45,758 members.

It’s been a busy year.

In April, our hearts were heavy as we mourned the passing of director Sandy Franke, not long after she was re-elected to the board at the 2023 annual meeting. Chris Aarhus was appointed by the board in July to take her place. Director Colin Wegenast was also re-elected at the 2023 meeting.

Investing in the future of our members continues to be a top priority. Last spring, FCCU awarded $57,000 in scholarships including 15 single scholarships and 13 multi-year scholarships. Education is the key to unlocking potential and we’re honored to play a part in our members’ educational journeys. Please encourage students around you to start their financial lives with FCCU and let them know these scholarships are available to them.

We held a celebration on August 1 for our newly remodeled Bismarck North branch.

We also broke ground on our Moorhead branch in early July, which is scheduled to open in the fall of 2024.

In September, we were named one of the “50 Best Places to Work” by Prairie Business magazine for the fourth year in a row. Additionally, we were named “Best Credit Union” of North Dakota by Forbes Magazine. We also entered into a historic partnership with UND athletics that was celebrated August 17 in Grand Forks.

At FCCU, serving our members is always top of mind. The Board of Directors, management and our dedicated employees continually look at ways to be more efficient with our members’ assets. After careful consideration of how best to utilize limited resources in a tight labor market, we consolidated four small branches in December of 2023. We strive to make decisions with the entire membership in mind.

This decision ensures that our members will continue to receive the best possible support and experience.

With each interaction, you remind us of the importance of community and partnership.

Thank you for entrusting us with your financial needs and dreams, and we hope you’ll recommend our credit union to your friends and family.

Life is better with community.

1-800-850-7676 myFCCU.com First Community Credit Union 310 10th Street SE Jamestown, ND 58401