2018 Joint Report
We made great strides in 2018 – both as an organization of 100 employees who treat each other like family and as a 278 million dollar credit union serving 50,000 members across North Carolina and throughout the country. In 2017, we began a Heart of Service campaign to better focus on our members and their financial needs. In 2018, we expanded our Heart of Service campaign to include a “Why” discussion. I challenged the credit union staff to understand and focus on their personal “Why” – the reason we as individuals do the things we do and understanding the motivating factors that drive us. We also developed the Why statement for Members Credit Union to explain why the credit union exists and what we hope to accomplish each and every day. Our Credit Union Why statement is “To be our members caring and trusted financial partner so that we provide each member the ability to focus less on finances and more on what really matters in their daily lives.”
Throughout the year we worked diligently to deliver the credit union “why” by finding ways to give back to our members. In October the ATM excess withdrawal fee that was charged to members who used their MCU Cash Card more than two times per month was eliminated, which will return back to our members approximately $200,000 annually. This fee reduction will most positively affect those members who live paycheck to paycheck and may rely solely on the MCU Cash Card to access their money.
The savers of the credit union have also been rewarded with the introduction of tiered savings rates for Money Market and Super Sixty account holders. The higher the balance of the account the higher the dividend yield the member will receive. Certificate of Deposit rates also increased in 2018 to reflect the changing interest rate environment. Currently, our Certificate of Deposit rates are among the market leaders in our geographic location. We project that the increased rates on Money Market, Super Sixty, and Certificate of Deposit accounts will return over $300,000 back to our members in the coming year.
With the lowest auto rates in the industry we make it easy for members to focus less on finances and more of what matters in their daily lives. By choosing to finance their automobile through the credit union members can save time with our seamless application process and also save hundreds, if not thousands, of dollars in interest charges over the life of the loan. The 7.85% increase in auto loans in 2018 is evidence that members are taking advantage of our attractive rates and easy application process.
Giving back to our members also means continuing to invest in the dynamic technological services that are available today. As an example we worked throughout 2018 to put into place a new and much improved home banking product and I am pleased to report that MEMCU Online and MEMCU Mobile successfully launched earlier this month. This was a significant investment in time and money yet necessary to ensure that our members are afforded the best possible digital banking experience. Members can now pay bills, transfer funds to other MCU accounts, make loan payments and complete Person to Person (P2P) payments – all behind one single sign on.
While members are gravitating more and more to our digital options, we still believe there is a segment of our membership that prefers a face to face banking experience, which is why we continue to invest in our brick and mortar locations. In October of 2018, we relocated our Hope Mills office to a more modern and convenient location, leaving a building that was over one hundred years old and in dire need of major renovations. The new branch is centrally located on Main St in Hope Mills with ample parking and a much more inviting lobby space. We are confident that the new and improved Hope Mills location will be welcomed by our existing members and will lead to membership growth in the area.
October was also the month of the grand opening of our first high school branch located inside of Davie County High School in Mocksville, North Carolina. The full service branch, named War Eagle Credit Union, is open to all students, faculty and other employees of Davie County High School. Parents of students are also eligible to join after the student establishes membership. The branch is staffed by a full time Members Credit Union employee and supplemented with high school students who are enrolled in the Business curriculum.
Our high school branch is a natural next step from the Reality Fairs, which teach students how to plan and budget, that we have conducted in area schools since 2012. Our high school branch will be a great learning and life experience to the students of Davie County High School as this will be, for many of them, their first bank account. The branch will increase our presence in the fast growing Davie County area and, in the future, may lead to a free standing full service branch to serve all of the residents of the county.
Being a trusted financial partner in our communities that we serve means more than having a convenient branch location and offering great savings and loan rates, which we already do. It also means supporting local causes and charities in these communities. In 2018, we made charitable donations to ten organizations across the state totaling $54,000. Some of the causes chosen to receive support were the Alms House in Hope Mills with a donation of $3,600, the Mission of H.O.P.E. in Winston-Salem with a donation of $10,800, and a $7,200 donation to the Out of the Garden Project in Guilford County. All of these donations were earmarked to help needy children in these communities, with a focus on fighting childhood hunger.
The credit union established $500 grants in fifteen North Carolina school districts to provide a selected teacher within each district funds to purchase school supplies for the classroom. This grant program will continue in 2019 and beyond. In addition, we added $100,000 to our MCU Scholarship fund so that we can continue to provide educational opportunities for our members.
While it is our top priority to give back to our members and within our communities, I am extremely pleased to report that the financial condition of the credit union has never been stronger. In 2018, the credit union earned net income of $2.68 million, by far the highest income level in its 65 year history. The year ended with a robust capital to asset ratio of 12.35%, which makes the credit union well prepared for any potential future downturns in the economy.
Although total deposits showed only slight growth from the end of 2017 to the end of 2018, we have experienced significant growth in our core deposit accounts of checking and savings. Checking accounts grew 5.29% in 2018 and savings accounts have increased by 5.50% over 2017. Growth in these two primary account types indicate that more members are using the credit union as their primary financial institution. We believe that core deposit growth is a better barometer of member loyalty and satisfaction than overall deposit growth, which can more easily be influenced by external factors such as stock market conditions, market interest rate movement or many other economic variables.
We are excited about the direction that the credit union is heading and we will continue to build upon our successes of 2018. Our commitment to giving back to our members through lower fees and increased deposit rates and by supporting charitable causes in our local communities will not slow down. We look forward to your support in 2019 as we strive to fulfill our “why” statement and make Members Credit Union your trusted financial partner.
-Robert Donley
President & CEO
Members Credit Union