2017 ANNUAL REPORT — February 20, 2018 —
PRESIDENT’S REPORT
Ron Burkhalter, President
On behalf of our board of directors, management and staff of Gulf Credit Union, it is a pleasure to be here with all of you. Because of your trust and involvement, our credit union is able to thrive and provide so many important benefits, not only to our members but to our community. As a financial cooperative, our success is your success. When you participate in the credit union, you are contributing to its growth. And because of our cooperative structure, we are able to return our profits back to you, the owners and members, by offering competitive rates, new products, enhanced services, and additional points of service. It is my privilege to provide the state of our credit union for our 2018 Annual Meeting.
FINANCIAL VIABILITY:
COMMUNITY SCORECARD:
• • • •
• We collected over $20K for relay for life and the American Cancer Society in 2017. • In 2016, we began our Gulf Helping Hands Volunteer Program initiative. This program has allowed us to partner with several non-profit organizations by allowing us the opportunity to make a difference in people’s lives. • Our employees volunteered for 15 different events for a total of 222.50 volunteer hours. • We hosted food and toy drives for Community Care Prayer Outreach. • We hosted angel trees for Buckner Children & Family Services. • We supported the Project Celebrations for all of our area high schools. • We awarded $10K in high school scholarships in 2017. • Our Gulf Helping Hands Employee of the Year was Nancy Bernard. Nancy volunteered over 34 hours of her time to give back to our community.
We had loan growth of 13.66% or $9.8M We had deposit growth of 26.14% or $22.6M We had asset growth of 25.01% or $61.9M We contributed to the member capital for 2017 of over $170K
NEW PRODUCTS ON THE HORIZON: • We will convert to a new core operating system in September 2018. • Our new core system will provide updated products like our homebanking as well as new products that were not previously available. • We will continue our Hispanic initiative for our increasing Hispanic member population. • As part of this initiative, we launched our Spanish Facebook page on February 1st. • We will educate our members on our new memberfriendly search engine to our website that will improve our member’s experience. • We will continue to be very competitive on loan rates for autos, personal loans and recreational products and commercial loans.
Hurricane Harvey was a devastating event that impacted all of our lives. Our GCU family had over 40 employees who sustained various amounts of damage to their homes and personal property. Furthermore, we had 505 member hurricane claims related to car loans for a total of $7.2M paid off loans. Of those 505 paid out loans, we refinanced 476 loans which represented 95% of loss claims that were refinanced. • We offered disaster loans to our members at a low fixed rate for 36 months • We waived fees to our members • We deferred loans through October 31, 2017 With our increased deposits and a rising interest rate market, our members understand the safety and soundness of their credit union and enjoy the share insurance of NCUA. As our membership grows, so do our assets, which indicates that you are taking full advantage of the products and services we offer. We appreciate your loyalty and membership to Gulf Credit Union. Our goal is to help serve your financial needs to the best of our ability. We realize these needs and technology are ever-changing. We strive to reach this goal by conducting constant training on the products and services that we offer to you. Everything we do, whether it be our financial viability, new products, community involvement or staff training, is geared towards our desire to fulfill our mission and vision of creating relationships with our members by matching a need with a product. We know that when we fulfill our mission and vision, each household will improve financially.
• • •
As we embark on the year ahead, my commitment to you today is that Gulf Credit Union will continue to: Grow responsibly, while listening and responding to your needs Continue to explore and deliver innovative product/service solutions Develop our staff and board so we can confidently serve you
Thank you so much for being an integral part of our credit union family. On behalf of the entire staff and board, we look forward to a happy and successful 2018 for us all.
FINANCIAL INFORMATION December 31, 2017 ASSETS Net Loans to Members Available Liquidity (COH) Investments Property & Equipment – Net Reserve Interest Receivable & Other Assets Total Assets
OPERATING INCOME / EXPENSE $151,990,597 $41,442,727 $83,474,657 $6,092,264 $2,470,768 $23,966,472 $309,437,485
LIABILITIES Members’ Deposits Accounts Payable/Other Members’ Equity Total Liabilities & Members’ Equity
$294,047,154 $3,991,861 $11,398,470 $309,437,485
Interest Income Fee Income Total Operating Income
$7,194,110 $5,342,909 $12,537,019
Provision for Loan Loss Total Operating Income After Loan Loss
$404,246 $12,132,773
Other Operating Gain/ (Loss) Operating Expense Net Income Before Dividends Dividends to Members Increase in Equity
$45,006 $11,131,512 $956,254 $776,606 $179,648
STATISTICAL INFORMATION FOR YEAR 2017 NUMBER
DELINQUENT LOANS
AMOUNT
14 4 0 18 8091 1275 Total Loans
2 to 6 months 6 to 12 months 12 months and over Subtotal Less than 2 months Loan Participation $152,619,446
$101,888 $543,917 $0 $645,805 $11,343,931 $152,619,446
Loans Charged Off Year-to-Date Recoveries on Loans Charged Off Delinquency Percentage Estimated Solvency Ratio
$534,273 $111,600 0.42% 104%
27,414 Members at End of Period 5,034 Loans Year-to-Date
$74,582,638
FINANCIAL CHARTS & GRAPHS ASSETS
$250,000,000
$50,000,000
2013
MEMBERSHIP ANALYSIS
2014
2016
2015
$309,437,484
$100,000,000
$247,528,776
$150,000,000
$237,526,364
$218,376,020
$230,576,307
$200,000,000
2017
30,500 30,000 29,500
28,000
28,710
28,500
28,955
29,000
26,500 26,000 25,500
27,414
27,179
27,000
26,955
27,500
2013 2014 2015 2016 2017
LOAN ANALYSIS Legend $160,000,000 2013
$140,000,000
2014 $120,000,000
2015
$100,000,000
$80,000,000
2016 2017 2013
2014
2015
2016
2017
$108,000,000 $115,000,000 $124,000,000 $142,000,000 $152,000,000
APPLICATION TO AMEND BYLAWS On October 6, 2017 The Credit Union Department approved an Application to Amend Bylaws – Corrections to our FOM (Field of Membership) The Commissioner advised that a phrase was added in prior years without any clear understanding and no benefit to the credit union. “All fields of membership to now include Harris and Nueces Counties” was removed.
NOMINATING COMMITTEE
Barry Gorman, Chairman of the Nominating Committee
The Nominating Committee was appointed at the November 16, 2017 Board of Directors meeting. Those serving on this committee are: Barry Gorman (Chairman), Camille Jones, and Robert Adams. Two terms are up for election at the February 2018 annual meeting. The Nominating Committee respectfully nominates Libby Arnold and Carl Duplantis.
CHAIRMAN’S REPORT It gives me great pleasure to welcome you to Gulf Credit Union’s 79th Annual Meeting. I am pleased to serve as your chairman and I am very humbled by the level of trust you have placed in me and my fellow board members. In fact, I would like to take this opportunity to thank my fellow board members for their dedicated service, commitment, and passion, because they have contributed greatly to the success of our credit union. As you see in the Annual Report, Gulf Credit Union Libby Arnold, Chairman performed well in 2017. • As our CEO will note in his address, membership at GCU now stands at 27,414, representing 7% of Jefferson, Orange and Hardin counties. • Our 27,414 members have added more than $60,936,034 to their deposit accounts. • You, the members and owners of this institution, have borrowed $74,582,638, adding more than 5,034 new loans. • Whether you are a consumer or a commercial member, we are so appreciative that you turned to your credit union for these financial needs. In 2017, you added $15,919,990 more in net increase to consumer loans. • Even with a challenged economy, GCU committed to continue offering favorable interest rates, as a result, many of you were still motivated to buy new vehicles and other household and commercial products. • The median delinquency ratio at GCU is now 0.42%, which tells me you’re staying on top of your debt obligations, and that is a sure sign of an improving household confidence in seeking new debt. Your ongoing participation in GCU means that we will remain in a strong financial position to continue meeting your financial needs. Your strong participation reflects your recognition that Gulf CU is a not-for-profit cooperative, and we are different than banks. Though we must make a profit to keep the doors open, one main difference is we don’t have shareholders waiting with their hands out; there are no shareholders. When we can, we distribute those profits back to you. By exercising sound business and service strategies, we can help you navigate your life-cycle challenges, weather these uncertain economic periods, and recognize the true benefits of your membership. As we closed 2017 and look to 2018, our mission and vision of creating relationships and our core values we operate by, will ensure that we are meeting your needs with the right product. Our credit union team will continue to strive to improve your experience. You can be proud and confident that as we continue to improve our financial viability, enhance products, invest in our community, and increase our knowledge of your needs, our mission and vision for you will be accomplished. Thank you so much for your membership, and all the best for the coming year!
Respectfully Submitted, Barry Gorman, Chairman of the Nominating Committee
G
AUDITOR’S REPORT The Certified Public Accounting Firm of Wathen, DeShong & Juncker, L.L.P., was retained by the credit union’s Board of Directors to perform a comprehensive audit of the institution’s financial statements. The firm issued an opinion on the financial condition of Gulf Credit Union on March 24, 2017.
REPORT ON THE FINANCIAL STATEMENTS We have audited the financial statements of Gulf Credit Union, which comprise the statements of financial condition as of December 31, 2016 and 2015, and the related statements of income and comprehensive income, members’ equity, and cash flows for the years then ended and the related notes to the financial statements.
OPINION In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Gulf Credit Union as of December 31, 2016 and 2015, and the results of its operations and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America.
VISION STATEMENT
Gulf Credit Union’s vision is to “create a relationship” with members. Our vision is met by matching our member’s need with the right product.
MISSION STATEMENT
From generation to generation, Gulf Credit Union is your partner in fulfilling your financial dreams.
BOARD OF DIRECTORS
EXECUTIVE STAFF
NAME
TERM ENDS
Libby Arnold, Chairman Carl Duplantis, Vice Chairman Camille Jones, Secretary Robert Adams, Treasurer Johnny Lewallen Karen Brown Barry Gorman
2018 2018 2019 2019 2019 2020 2020
ADVISORY BOARD MEMBER Harold Guilbeau
GROVES (Main Office)
5140 West Parkway P.O. Box 848 Groves, TX 77619 409.963.1191 / 800.448.5328
2018
BEAUMONT
2360 Dowlen Road Beaumont, TX 77706 409.860.3600
Ron Burkhalter, President/CEO Linda Rials, Vice President of Finance Cindy Winfrey, Vice President of Operations Kristy Byers, Assistant Vice President of Lending Shirley Manuel, Assistant Vice President of Lending Operations Todd Gaudin, Vice President of Commercial Lending Greta Smith, Human Resource Director Sue Rogers, Marketing Director Stephine Adams, Risk Management Director Kathy Wolford, Executive Assistant Amanda Skinner, Project Manager John Pat White, II, CRPC, Vice President of Wealth Management, Gulf Investment Group
BRIDGE CITY
4721 Hwy. 87 South Orange, TX 77630 409.735.5156
GULF CREDIT UNION IS FEDERALLY INSURED BY THE NATIONAL CREDIT UNION ADMINISTRATION.
MID COUNTY
2779 Aero Drive Port Arthur, TX 77640 409.729.8280