TruStone 2021 Annual Report

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True to Our Word.

2021 ANNUAL REPORT

Contents Report of the President & CEO . . . . . . . . . . . . . . . . . . . . . . . . . 3 Report of the Board of Directors . . . . . . . . . . . . . . . . . . . . . . . . 4 Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Leadership . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 Report of the Supervisory Committee . . . . . . . . . . . . . . . . . . . 12 2021 Charitable Donations . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 2021 Awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Tribute Roger Cersine . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Products & Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 Locations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17

REPORT OF

The President & CEO 2021 was an incredible year for your credit union, one where we delivered more services to more members than any time in our 82-year history. I would be remiss if my annual report to the membership didn’t reference this amazing accomplishment.

Nevertheless, I am compelled to use this forum to share our plans for 2022, because I believe the best is yet to come.

Improvements to the Member Experience.

Investments in Safety and Soundness.

Every day thousands of members conduct business directly

Our ability to deliver fast, convenient service should never

with our team, whether that is in person at a branch, over the

compromise your security. To that end we’re continuing to

phone, or via digital communication. We took several steps

upgrade our capabilities in 2022, including a 24x7x365

to improve wait times last year, and are taking many more

security operations center, a modern data loss prevention

in 2022. We’re adding staff, expanding our call center, and

platform and artificial intelligence/predictive analytics to

improving our systems to be more responsive to your needs.

further protect our members from unauthorized access to accounts.

Improvements to the Digital Experience.

Over 120,000 of our members choose to do business with

Investments in our Community.

TruStone through our digital and mobile banking platforms.

The good works of the TruStone Financial Foundation

We are expanding the features of those channels with the

are documented throughout this report, furthering our

addition of person-to-person transfers, pre-approved loans

transformation from community involvement to community

to simplify the application process, and seamless access to

impact. That volunteer committee has – and will continue

your credit score.

to – expand their reach with more investments in financial education, scholarships, and local charities. We’re also taking

Improvements to our Services.

a bigger stage later this year with the Minnesota Aurora

We have a diverse membership, and one size definitely does

pre-professional women’s soccer team. Aurora is

not fit all. To address your evolving needs, we’re adding

community-owned and women-led, and we are proud to

additional mortgage programs and improving features of

be a founding sponsor.

our checking accounts. Further, we’re implementing services like a guaranteed on-time first mortgage closing and vehicle refinancing in less than a minute, that quickly and conveniently save our members time and money.

Despite all that we have accomplished, there is more we can do to better serve you. On behalf of the entire TruStone team, I thank you for your continued business, and for joining us on a journey that has only just begun.

Dale Turner

PRESIDENT & CEO

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2021 TRUSTONE ANNUAL REPORT

REPORT OF

The Board of Directors 2021 was a year of significant change for TruStone Financial. The merger with Firefly Credit Union did far more than accelerate our growth – it expanded our potential to serve like never before.

Nearly 200,000 members now do business with TruStone at 23 locations in the Greater Twin Cities Community, St. Cloud, and southeast Wisconsin. Last year our members borrowed more than $2 billion from their credit union, nearly half of which was for the purchase of a new home or to refinance an existing first mortgage. Approximately, 8,000 members financed a new vehicle with TruStone and more than $260 million was approved in home equity loans. Additionally, members opened 12,000 checking accounts, activated 5,000 new credit cards, and conducted millions of digital and mobile banking transactions.

By all accounts it was a very successful year, if not the most successful in our 82-year history.

Those results are all the more impressive when considering we began 2021 with a formidable task – initiating one of the largest and most complex mergers in credit union history. The assimilation of hundreds of systems, thousands of processes, and hundreds of thousands of products and services was not without bumps in the road. To those members that experienced service disruption during this time, we thank you for your patience and your continued dedication to TruStone Financial.

Getting past integration and back to business was a massive effort, one that we achieved with strong leadership, dedicated employees, and a clear mission. Regarding the latter, in early 2021 your board of directors revisited TruStone’s Mission Statement. It was important to us, as a recently merged entity ourselves (we are comprised of legacy board members from both credit unions) that we had alignment on our purpose. The outcome of that exercise is as follows:

Our Mission We engage, educate, and inspire our members to achieve lifelong financial well-being.

As a credit union, we are called upon to put our members first. We are dedicated to your financial wellness. Our members recognized this in 2021 and more of you than ever chose TruStone as your primary financial institution. But, as our mission clearly states, this is a relationship we intend not just for the duration of your car loan or your certificate of deposit. The commitment we make to our members is for life.

On behalf of your volunteer board of directors, we appreciate the trust you have put in us. It is our honor to serve you, and we are committed to help guide TruStone toward the fulfillment of our mission.

Respectfully submitted,

John Christenson CHAIR

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2021 TRUSTONE ANNUAL REPORT

Balance Sheet

($ IN THOUSANDS)

ASSETS Loans, net Cash & Investments Property and Equipment, net

2021 $

2,817,264 945,230 53,662 163,611

$

2,470,188 866,982 56,110 155,098

$

3,979,767

$

3,548,378

$

3,466,534 42,500 55,654

$

3,082,610 42,500 43,159

Other Assets Total Assets

2020

LIABILITIES AND MEMBERS’ EQUITY Member Shares Borrowed Funds Other Liabilities Total Liabilities Members’ Equity Total Liabilities and Members’ Equity

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2021 TRUSTONE ANNUAL REPORT

$

3,564,688

3,168,269

415,079

380,109

3,979,767

$

3,548,378

Income Statement

($ IN THOUSANDS)

NET INTEREST INCOME Loans Investments Dividend/Interest expense

2021

2020

$

107,796 9,450 13,415 4,679

$

56,649 5,334 12,718 1,926

$

99,152

$

47,339

$

23,411 12,662 8,330

$

27,412 7,725 6,376

$

44,403

$

41,513

Compensation and benefits Occupancy and office operations Other

$

61,267 20,568 17,111

$

36,425 10,766 10,413

Total Non-Interest Expense

$

98,946

$

57,604

$

44,609

$

31,248

Provision for loan losses Net Interest Income

NON-INTEREST INCOME Loan sale and servicing Service fees Other non-interest income Total Non-Interest Income

NON-INTEREST EXPENSE

Net Income

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2021 TRUSTONE ANNUAL REPORT

Member Service

9.74

198,711 SATISFACTION SCORE

TOTAL MEMBERS

8,640

9.74

MEMBERS PER BRANCH

MEMBER EFFORT

351

MEMBERS PER FTE

9.68

OVERALL EXPERIENCE

Member service scores based on 10-point scale

*

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2021 TRUSTONE ANNUAL REPORT

Total Assets ($ in thousands)

$17,286 AVERAGE SHARES PER MEMBER

547

EMPLOYEES

$1,553,646 2019

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2021 TRUSTONE ANNUAL REPORT

$3,548,378 2020

$3,979,767 2021

23

BRANCHES

Member’s Equity ($ in thousands)

$2,089 EQUITY PER MEMBER

1.19%

RETURN ON ASSETS

$169,016 2019

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2021 TRUSTONE ANNUAL REPORT

$380,109 2020

$415,079 2021

82%

LOAN TO SHARE RATIO

Leadership BOARD OF DIRECTORS

John Christenson Chair Anne Ziebell Vice Chair Samuel L. Stern Secretary James Sackett Treasurer

Thomas Alagna Stephen Bohlig Kevin Crane Stephen Hunziker Evelyn Jones Darrick Metz Doug Nesbit Bruce Whitmore Kristine Ziccardi

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ASSOCIATE DIRECTORS

John Fraser Jennifer Whitlock

Leadership EXECUTIVE MANAGEMENT TEAM

Dale Turner President and Chief Executive Officer Nathan Grunzke EVP/Chief Mortgage Officer Cole Hahn EVP/Chief People Officer Hans Iverson EVP/Chief Operations Officer Gary Jeter EVP/Chief Technology Officer Martin Kelly EVP/Chief Marketing Officer Steve Steen EVP/Chief Retail Officer Phil Young EVP/Chief Legal Officer Daniel Zaczkowski EVP/Chief Financial Officer

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2021 TRUSTONE ANNUAL REPORT

SUPERVISORY COMMITTEE

Teena Buenviaje-Liu Committee Chair Brian Lee Secretary Lori Bonin Associate Esmail Harunany Bob Larson Lenny Newman

REPORT OF

The Supervisory Committee As a member of TruStone Financial Credit Union, you have entrusted us to oversee the credit union’s internal controls that safeguard your finances as well as your personal information.

We take that responsibility seriously, and as such we engage both internal and external sources to conduct audits of different aspects of our financial, administrative and operational practices.

In 2021, your credit union received thorough examinations from both state and federal agencies, which yielded overall positive results. We also engaged an independent public accounting firm to perform our financial statement audit in accordance with regulatory requirements for the 15-month period ending December 31, 2021. And every day we rely on our experienced internal auditors to support our commitment to you.

On behalf of your volunteer Supervisory Committee, I thank you for your membership, your business, and your continued confidence in TruStone Financial.

Teena Buenviaje-Liu

SUPERVISORY COMMITTEE CHAIR

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2021 TRUSTONE ANNUAL REPORT

2021 Charitable Donations TRUE GIVING – MAKING AN IMPACT

TRUSTONE FINANCIAL FOUNDATION

True to our word, at TruStone Financial we challenge the status quo to better serve the needs of others – our

The TruStone Financial Foundation is a not-for-profit 501(c)

members, our team members and our communities by hosting organizational events that give back in every

(3) organization founded in 2009 by TruStone Financial

community we serve. By devoting countless hours volunteering to help our neighbors, TruStone partners

Credit Union. The foundation was established to reinforce

with many charitable organizations, hosts donation drives, sponsors events in our communities, and provides

our commitment to financial education, supporting our

complimentary on-site events such as shred days and home buying seminars. Whether we are on clean up

communities with scholarships, donations to local non-profits,

duty, teaching a budgeting class at the local elementary school or providing financial support, TruStone puts

and investments in financial literacy programs.

the needs of our neighbors first to create a stronger, more resilient community. With the help of our TruStone Financial Foundation our total impact in 2021 includes:

14,200 Meals

$41,400

Provided to Minnesota

Donated to Casual for a Cause and matched

& Wisconsin Food Shelves

by the Foundation in support of Hope Council, Special Olympics, Highland Friendship Club and more.

$10,000 Donated to 10 local High School

$80,000

Sports as a sponsor of Prep Sports

Donated by TruStone Foundation in support

Hot Highlights

communities for initiatives such as financial education, racial equity and inclusivity.

Donated $9,000 to Aiding Ukraine, a nonprofit

Collected and donated

during an important time of need.

to Toys for Tots

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$9,000

$3,000 + 1,800 Toys

2021 TRUSTONE ANNUAL REPORT

formed to support the Ukraine community

2021 Award FORBES BEST-IN-STATE TruStone Financial was named a 2021 Best-In-State credit union by Forbes magazine.

The credit union was one of only five in Minnesota to be named, placing TruStone among the top 3.6% in the nation on Forbes’ 2021 list.

Forbes and market research firm Statista used an independent survey of almost 25,000 members to identify the best credit unions in every state. Survey participants rated credit unions based on overall recommendation and general satisfaction. Participants also rated the credit unions based on trust, terms and conditions, branch services, digital services and financial advice.

For Community,

By Community MINNESOTA AURORA PARTNERSHIP As part of our commitment to giving back, TruStone supports organizations that share our own vision and commitment of elevating the community through teamwork, respect and inclusiveness. Minnesota Aurora FC, is the first women’s pre-professional soccer team in Minnesota with a stated purpose of being for community and by community. A women-led and community owned team, that believes in doing things differently. TruStone is proud to be a founding sponsor of the Minnesota Aurora and excited to support the efforts of bringing communities together and effecting change in the world.

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2021 TRUSTONE ANNUAL REPORT

TRIBUTE

Roger Cersine Roger Cersine was a TruStone member and volunteer for nearly 50 years.

He served on our Supervisory Committee, the TruStone Home Mortgage Board and our Board of Directors before his retirement in 2018. Roger passed away in late 2021, but his leadership, warm personality, and advocacy for the well-being of our members will not soon be forgotten.

Roger was a long time AP history and sociology teacher at Minneapolis Washburn High School. In addition, he served as a swimming and diving official for the Minnesota State High School League where he was inducted into the MSHSL Hall of Fame. TruStone will be making a $1,000 donation to the Minnesota State Officials Association (to be used for scholarships to high school swimmers) in honor of Roger’s commitment and service to the credit union membership and surrounding community.

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Services SAVE

MANAGE

Savings & Certificates

Digital Banking

Health Savings Accounts (HSA)

Bill Pay

Youth & Teen Savings

Zelle® MobilePAY

SPEND

Checking Visa® Debit Card Visa® Credit Card

Mobile Deposit eStatements 65,000 Surcharge-Free ATMs Nationwide 5,000+ Shared Branches Nationwide

Checking & Credit for Teens BORROW

INVEST

TruStone Home Mortgage

TruStone Finanial Advisors

Home Equity Loans Auto Loans Recreational Loans Personal Loans Adoption Loans

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2021 TRUSTONE ANNUAL REPORT

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