Pantex FCU 2021 Annual Report

Pantex Federal Credit Union

ANNUAL REPORT 2021

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Financial

Health

DepositAccounts.com, a subsidiary of Lending Tree, routinely evaluates the financial health of every federally insured bank and credit union in the United States. Each financial institution is graded on a number of factors, including capitalization, deposit growth, and loan-to-reserve ratios.

In 2021, Pantex Federal Credit Union received the DepositAccounts.com top rating of A+, making the list as one of the “Top 200 Healthiest Credit Unions in America.”

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Capital

Strength

Bauer Financial has independently analyzed and reported on U.S. financial institutions, on a quarterly basis, since 1983. Pantex FCU ended the 2021 year by receiving the Bauer Financial 5-Star Rating for the 106th consecutive quarter. That's over 26 years!

With this rating, Pantex FCU enjoys “Best of Bauer Credit Union” status, and Bauer recognizes our credit union as being one of the strongest credit unions in America... strong enough to be there when needed!

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Each year, the Borger News-Herald encourages its readers to submit nominations for the “Best of the Best” in our community. In 2021, Pantex FCU, once again, was honored to make the list as the “Best Financial Institution” in our area. This recognition isn't taken lightly! Pantex FCU trusts this vote to indicate the level of confidence that our staff and branches have earned, as well as the degree of satisfaction that our members and communities experience. We are here to serve you... and we're glad it shows!

Member

Service 5

Fast. Safe. Easy.

Just log-in to your Pantex FCU online banking or mobile banking app to get started.

Learn more at pantexfcu.com.com 6

Terms and conditions apply. Zelle and the Zelle related marks are wholly owned by Early Warning Services, LLC and are used herein under license. Copyright © 2019 First Financial.

All rights reserved. Equal Housing Lender. Member FDIC.

Meeting Agenda Call to Order (7:00 p.m.)

Reading of the Previous Minutes Reports from Officials Old Business New Business Election of Officials Drawing of Door Prizes Adjournment 7

Board of Directors

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Allen Jenkins Chairman Harvey Hilbert Vice-Chair Debra Wells Treasurer Glynn Carlock Secretary Larry Thompson Fran Braden Lynn Hopkins

Supervisory Committee Sara Ramby Chairperson Judy Flanders Tina Briscoe Addison Killough

Professional Staff Cliff Murley President/CEO Curtis Hall Executive Vice President Dana Slater Vice President/Accounting Rodney Franklin Branch Manager-Fritch Carrie West Senior Loan Officer Dana Martin Branch Manager-Walmart Shannon Mears Loan Officer Shelby Overpeck Loan Officer Michael Robinson Vice President of IT Mikel Cauthon Network Administrator Tanya Fraley Asst. Vice President of Member Services

Alicia Morgan Asst. Vice President/Tellers Dusty Lee Branch Manager-Pampa Robert Forester Marketing Director Linda Watson Imaging/Internet Banking Carla Howard Plastic Cards/Imaging Tiera Lesley Branch Head Teller-Fritch Kim Hughes Asst. Head Teller Brittney McWilliams Accounting Assistant Ginnie Whitfield Branch Head Teller-Walmart Karen Bryan Assistant Loan Officer Brook Hubbard Loan Processor/Assistant

Tellers SueAnn Broadaway Nilzaida Wood Sarah Elliott Rebecca Wilson Jennifer Farmer Maranda Grimes Lucy-Marie Green Candace Velasquez Ebony Jarrett Krisha Temple Tonja Brown Mistee Williams Lisa Bryan Desy Barraza Regan Huff Charlotte Jasper Angela Munoz Stevie Anderson Kenny Green Facilities 9

“

2021 was a year of drawing strength from our guiding principles while serving our most important mission:

‘PEOPLE HELPING PEOPLE.’ Cliff Murley, President/CEO

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”

Chairman’s Report On behalf of the Credit Union Board of Directors, staff, and committee members, I welcome you to our 81st Annual Membership meeting. Thank you for choosing Pantex Federal Credit Union for your financial needs.

I am grateful to report that, despite the challenges of the pandemic, the Credit Union maintains great financial health and capital. Included in this Annual Report are our Financial Statements and other 2021 statistics.

We strived to meet the needs of all members in every way possible, while also making a difference, big and small, across our community. I would like to convey my heartfelt thank you to my fellow Board of Directors, Supervisory Committee members, and most of all, our loyal credit union associates for their work and dedication on behalf of our members.

Thank you to our members for placing your trust in Pantex FCU. We aim to earn that trust every day. We are honored to serve you and appreciate your patience and fortitude as we stand with you in keeping our members, associates, and communities safe.

Thank you for your membership in Pantex Federal Credit Union.

Respectfully submitted, Allen Jenkins, Chairman of the Board

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Letter from the President At Pantex Federal Credit Union, 2021 was a year of drawing strength from our guiding principles while serving our most important mission: "People Helping People."

For over 81 years, our top priority has been, and continues to be, the financial health and well-being of our members and our communities. With the COVID-19 pandemic lingering on, we understand that these uncertain times can hold unplanned financial hardships. That is why we are taking even bolder steps to protect you and your loved ones.

Take comfort in knowing that some things remain constant and reliable. Pantex Federal Credit Union is here for you. We are still by your side. And, we are committed to providing tools and resources designed to help you make sense of your dollars so you can live with the comfort of total financial wellness, regardless of your circumstance.

As your Credit Union, it is our goal to lead by example, from our comprehensive financial services, to our active community involvement, and everything in between. We are proud to call you our members and are thankful you have chosen Pantex FCU as your trusted partner.

Respectfully submitted, Cliff Murley, President/CEO

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Buying a car, new or used, has never been easier!

Current loan rates make it a perfect time to buy!

Pantex FCU is offering great rates for qualified buyers on new or used cars, trucks, SUVs, motorcycles, boats ATVs and other recreational vehicles. Plus, with Pantex FCU, members get the best service around. Ask about pre-approvals!

Apply in-branch or online today.

We are here to help!

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Treasurer’s Report As members of your volunteer board, we have the responsibility of ensuring that your credit union is safely and soundly operating. We are charged with ensuring that the institution has a solid financial foundation. 2021 was a difficult year. The pandemic effects continued to cause increased operating costs and the historically low interest rate environment and low loan demand have negatively impacted revenue. A recovery of previous Southwest Corporate Credit Union losses and controlled expenses helped us realize better than expected earnings in this pandemic environment. The credit union has an exceptionally strong capital ratio of 18.97%.

$629,927.19 Total Share Dividends Paid Represents a return to the membership of 7.1% of total income earned by the Credit Union in 2021.

21.9% was placed in statutory reserves to keep capital levels strong.

PFCU has maintained a 5-Star Bauer Rating for over 26 years and was also named Among the "Top 200 Healthiest Credit Unions in America" by DepositAccounts.com, a subsidiary of Lending Tree.

PFCU’s investment portfolio consists of deposits in other institutions, primarily Catalyst Corporate Credit Union, Federal Reserve Overnight Accounts and in United States Agency securities. The credit union only invests in the types of investments approved by the National Credit Union Administration.

PFCU 2021

Respectfully submitted, Debra Wells, Treasurer 14

71.0% was distributed to the normal operating cost of the Credit Union.

Loan Officer’s Report The Loan Officers are responsible for objectively evaluating the financial needs of the members, while at the same time, protecting the interest of the depositors/shareholders by making safe and sound lending decisions.

During the year 2021, PFCU members received 1,934 loans totaling $36,705,136.31 in new loans. Total loans outstanding increased by 8.16% over the previous year. The credit union worked with members effected by the pandemic with hardship loans, loan payment extensions and other repayment options. The credit union even worked with the SBA to offer PPP loans to effected small businesses members.

We are proud to say we achieved strong credit quality, and you can be sure PFCU is among the safest banking institutions around.

Whether you’re thinking about purchasing a new car, remodeling your home, or taking the trip of a lifetime, Pantex FCU has a consumer loan option to make it possible. Our loan experts are ready to help you make the best loan choice for you and your needs.

Respectfully submitted, Curtis Hall, Rodney Franklin, Carrie West, Shannon Mears, Shelby Overpeck, Dusty Lee, Dana Martin, Ginnie Whitfield, Karen Bryan

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Supervisory Committee Report Your Supervisory Committee members are appointed by the Board of Directors in accordance with the Federal Credit Union Act to ensure that your credit union conducts its operations and activities in a safe and sound manner. The Committee, as the members’ representative and official auditor, has the responsibility to review and evaluate the overall financial operations and performance of your credit union, including that of its management staff, to ensure that all of the regulations, procedures, and policies that govern this institution are properly followed.

The committee is assisted in carrying out its responsibilities by external auditors, who performed or directed quarterly audits and reviews during the year. The credit union is also periodically examined by our regulator, the National Credit Union Administration (NCUA), which completed one annual review during fiscal year 2021. The NCUA review did not indicate any significant findings and our own internal audits confirm that internal controls are in place and are effective.

In conformance with NCUA regulations, the committee contracted the accounting firm of Waypoint Advisory Services, Inc., to conduct an agreed upon procedures review of the credit union’s financial statements. The independent auditor found no significant issues to report back to the committee.

As a result of these reviews and audits, it is the pleasant duty of the Supervisory Committee to report to you that the affairs of the Pantex Federal Credit Union during 2021 have been conducted in a most satisfactory manner and in accordance with prescribed standards and accounting practices, and were found to be current, accurate, complete, and in balance.

The sound policies and practices of the Board of Directors contributed to the continuing growth and improvement of services, which have been evident over the past several years. We wish to commend the credit union staff for their efficient, attentive, and courteous service to our members. The cooperation and assistance they have provided this committee is appreciated.

We look forward to another year of service to our members and assure you that you can expect the same high standard of service that you received in 2021.

Respectfully submitted, Sara Ramby, Chairperson Tina Briscoe, Judy Flanders, Addison Killough

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Nominating Committee Report In accordance with the Pantex Federal Credit Union Policy Manual, to be nominated for a position as a Board Member or Committee Member, a person must meet certain qualifications. They must possess knowledge, experience, or interest pertinent to the credit union’s future; have a good credit standing with no criminal convictions; be a member of Pantex Federal Credit Union for at least two years; be willing to accept the responsibilities of the position; be objective and independent; and not be an employee of this or a competing institution; and be at least 18 years of age.

Three 3-year terms are available for re-election on the Board of Directors. The positions currently held

by Debra Wells, Glynn Carlock and Larry Thompson are up for election.

The Nominating Committee, composed of three members, met to discuss potential candidates, and have recommended that Debra Wells, Glynn Carlock and Larry Thompson be elected to the Board of Directors for these three-year terms based on their experience and training.

After posting these names in the lobby of the Credit Union, and receiving no petitions for nomination prior to the deadline, the Committee recommends that the individuals named above be accepted by the membership.

Respectfully submitted, Harvey Hilbert, Chairperson Fran Braden, Lynn Hopkins

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Statement of Income & Expenses Operating Income

December 31, 2021.

December 31, 2020

Interest on Loans. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 3,121,658.03 . . . . . . . . . . . $ 3,174,442.04 Interest on Investments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1,487,703.82 . . . . . . . . . . .

2,430,217.25

Misc Operating Income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2,204,354.73 . . . . . . . . . .

1,898,203.07

Total Operating Income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6,813,716.58 . . . . . . . . . . .

7,502,862.36

$629,927.19 Total Share Dividends Paid

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7.1% of total income earned was returned to the membership in the form of dividends.

71.0% was used for the normal operating cost of the Credit Union.

PFCU 2021

21.9% was placed in statutory reserves to keep the Credit Union capital levels strong.

Operating Expenses

December 31, 2021.

December 31, 2020

Compensation & Employee Benefits. . . . . . . . . . . . . . . . . . . $ 2,738,634.63 . . . . . . . . . . . $ 2,700,874.97 Travel & Educational Expenses. . . . . . . . . . . . . . . . . . . . . . . . . .

10,555.22 . . . . . . . . . . .

9,917.09 Association Dues. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

10,346.00 . . . . . . . . . . .

13,450.00 Office Occupancy Expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . .

286,050.95 . . . . . . . . . . .

294,645.65 Office Operations Expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . .

688,158.56 . . . . . . . . . .

718,350.07 Publicity and Promotional Expenses. . . . . . . . . . . . . . . . . . . .

34,681.63 . . . . . . . . . .

49,795.15 Loan & Plastic Card Servicing Expenses. . . . . . . . . . . . . . . . .

967,984.47 . . . . . . . . . . .

831,909.67 Professional Services. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

730,307.17 . . . . . . . . . . .

704,135.50 Provision for Loan Losses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

31,107.17 . . . . . . . . . . .

165,090.38 Federal Supervisory Exam Expenses. . . . . . . . . . . . . . . . . . . .

49,217.61 . . . . . . . . . .

59,822.29 Cash Short/Over. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

-956.57 . . . . . . . . . . .

-932.68 Annual Meeting Expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . .

7,844.62 . . . . . . . . . . .

12,396.99 Miscellaneous Operating Expenses. . . . . . . . . . . . . . . . . . . .

7 1,018 . 21 . . . . . . . . . .

87,422.09 Total Operating Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,624,949.67 . . . . . . . . . . .

5,646,877.17 Net Income from Operations. . . . . . . . . . . . . . . . . . . . . . . . . . . 1,188,766.91 . . . . . . . . . . .

1,855,985.19 Gain(loss) on disposal of Assets. . . . . . . . . . . . . . . . . . . . . . . . .

684.47 . . . . . . . . . . .

-3,214.15 Other Non-Operating Gain: Recovery of Previous Years Write-off on Investment in Southwest Corporate CU . . . . . . . . . . . . .

573,400.00 . . . . . . . . . . .

424,600.00 Dividends. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(629,927.19) . . . . . . . . . . (1,286,329.76)

Net Income. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1,132,924.19 . . . . . . . . . .

991,041.28 19

Statement of Condition Assets

December 31, 2021.

December 31, 2020

Loans(net). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $57,546,236.54 . . . . . . . . . . $ 53,203,286.09 Cash on Hand and in Banks . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2,924,586.51 . . . . . . . . . .

3,500,889.73

Investments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 159,236,935.23 . . . . . . . . . . . 158,993,870.34 Shares: Catalyst Corporate. . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5,040,383.25 . . . . . . . . . . .

6,764,900.08

Other Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

7,331,720.20 . . . . . . . . . .

7,777,780.94

Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

94,093.82 . . . . . . . . . .

94,093.82

Building. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

831,498.99 . . . . . . . . . .

896,713.96

Furniture & Equipment & Leasehold. . . . . . . . . . . . . . . . . . . .

319,700.79 . . . . . . . . . . .

403,274.52

Total Assets. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $233,325,155.33 . . . . . . . . . . $231,634,809.48

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Statement of Condition Liabilities and Equity

December 31, 2021.

December 31, 2020

Accounts Payable/Items in Transit. . . . . . . . . . . . . . . . . . . . . $ 1,872,595.21 . . . . . . . . . . $ 1,890,478.76 Accrued Dividends Payable. . . . . . . . . . . . . . . . . . . . . . . . . . . .

0.00 . . . . . . . . . . .

0.00

Accrued Liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

220,266.48 . . . . . . . . . . .

147,783.81

Total Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2,092,861.69 . . . . . . . . . .

2,038,262.57

Shares. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 187,498,611.63 . . . . . . . . . . 184,843,316.49 Regular Reserve. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

9,596,199.99 . . . . . . . . . . .

9,596,199.99

Accumulated Unrealized Gain/(Loss) on AFS Securities . . .

(534,564.86) . . . . . . . . . . .

1,617,907.74

Undivided Earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34,672,046.88 . . . . . . . . . . 33,539,122.69 Total Equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 231,232,293.64 . . . . . . . . . . . 229,596,546.91 Total Liabilities & Equity. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $233,325,155.33 . . . . . . . . . . $231,634,809.48

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MAIN OFFICE 1300 W. Wilson Borger, Texas (806) 273-5692

FRITCH BRANCH 411 E. Broadway Fritch, Texas (806) 857-2400

PAMPA BRANCH 807 N. Sumner Pampa, Texas (806) 665-4212

WALMART BRANCH 1501 Roosevelt Borger, Texas (806) 273-5698

HOURS Monday–Friday 9:00 am to 5:00 pm Drive Thru 8:00 am to 6:00 pm

HOURS Monday–Friday 9:00 am to 5:00 pm Drive Thru 8:00 am to 6:00 pm

HOURS Monday–Friday 9:00 am to 5:00 pm Drive Thru 9:00 am to 5:00 pm

HOURS Monday–Friday 9:00 am to 7:00 pm Saturday 9:00 am to 4:00 pm

Fraud Reminder!

Pantex FCU will NEVER call and ask for personal or banking login information! This includes social security numbers, complete card numbers, passwords, PIN (number), or one time pass or one time confirmation codes.

Please consider questions like these as a “red flag.” Hang up and call Pantex FCU as soon as possible!

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Mailing Address: P O Box 5206 Borger, TX 79008 Email: PFCU@PantexFCU.com Website: www.PantexFCU.com

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