“People Helping People” ANNUAL REPORT 2012 $250,000
“People Helping People”
ANNUAL REPORT 2012
$250,000
WELCOMETO OUR 50TH ANNUAL MEETING
Dear Fellow Members,
In 2013, the Credit Union is excited to celebrate 50 years of service toyou, our loyal members. With that in mind, the events of 2012 may palein comparison as the US economy remained fairly disappointing
throughout the last twelve months:
• The Gross Domestic Product rose less than 2%• The Unemployment Rate remained stubbornly high at 7.8%• Gasoline prices hovered around $3.60 per gallon
Similarly, the 2012 election results virtually assures more political gridlock asthe country struggles with large government deficits and an enormousfederal debt. Additionally, the Federal Reserve Bank has indicated that their“near zero” short-term interest rate policy, especially hard on savings, shouldcontinue well into 2015.
While the US economic and political situationswere rather disheartening in 2012, your CreditUnion eagerly moved forward with itscommitment to helping you achieve greaterfinancial security. The financial reportscontained in this booklet reflect our growth andstability as an organization as we reflect on ourfirst 50 years of member service.
In 2012, the Credit Union provided more than twenty-four million dollars inautomobile financing and sixteen million dollars in home financing. We alsoprocessed more than fifty-five million dollars in debit card purchases andthirty million dollars in credit card purchases.
The source of all this financial activity remains the pooled deposits of you,our loyal members. We are proud to report that member deposits grew morethan sixteen million dollars. And despite the “near zero” interest rate policyof the Federal Reserve Bank, the Credit Union was able to pay more thanthree million dollars in member dividends.
The Credit Union remains committed to providing its members the safetythey deserve for their hard earned savings. And, for the second consecutiveyear, our federal regulator issued your Credit Union its highest possiblerating for safety and soundness.
Douglas L. BurgessBoard Chair
David P. HagarPresident
April 9, 2013
Because most members look for convenience when conducting their financialaffairs, the Credit Union made several investments in technology during thelast year. To better serve you, we:
• Installed new Automated Teller Machines with bigger and brighter video monitors and an audio connection for the visually impaired.
• Upgraded our internet loan application system in order to more efficiently process loan applications.
• Replaced our telephone system to reduce expenses and improve redundancy.
The year ended on a high note with the introduction ofour Mobile Banking service, QT Mobile. In four shortmonths, over six hundred members have enrolled in thiseasy to use service. From the palm of their hand,members are:
• Checking account balances• Transferring money between accounts• Viewing account history• Paying bills through on-line bill payment
Today, with more than seven thousand members using our various electronicbanking services, QT Mobile is poised to become the ultimate in memberconvenience.
While convenient account access, financial stability and competitive loan andsavings rates are important reasons for choosing a financial institution,equally important is a friendly and knowledgeable staff that conductsthemselves with honesty and integrity. We are proud to have such a group ofvolunteers and staff, with forty percent having served you for at least tenyears. Through their hard work and dedication, we will continue to help youachieve financial security and peace of mind.
Thank you for your continued support of the Credit Union and we inviteyour family members and colleagues to enjoy the benefits of credit unionmembership.
FINANCIAL REPORT OF 2012
The annual audit of the accounts and financial records of the Baltimore County Employees Federal Credit Union as of December 31, 2012, was conducted by the firm of Rowles &
Company, LLP, Certified Public Accountants. The year-end financial statements, as of December 31, 2012, were also audited by Rowles & Company, LLP.
In addition, the records of the Credit Union were evaluated for compliancewith regulations and laws by the Federal examiners employed by the NCUA(National Credit Union Administration).
A Supervisory Committee meets monthly to test and verify various financialrecords of the Credit Union. The Committee is proud to report that allrecords and accounts are kept in a satisfactory manner by the personnel at theCredit Union office.
The Supervisory Committee also serves as a membership representative. Ifmembers have an unresolved financial matter with the Credit Union, theyare encouraged to contact the committee confidentially by writing to:
Supervisory CommitteeBaltimore County Employees Federal Credit Union
P.O. Box 6785Towson, Maryland 21285-6785
Report of Independent Auditors
Supervisory CommitteeBaltimore County Employees Federal Credit UnionTowson, Maryland
We have audited, in accordance with auditing standards generally accepted in theUnited States of America, the balance sheets of Baltimore County Employees Fed-eral Credit Union as of December 31, 2012 and 2011, and the related statementsof income, changes in members’ equity, and cash flows for the years then ended; andin our report dated February 25, 2013, we expressed an unqualified opinion onthose financial statements.
In our opinion, the information set forth in the accompanying condensed financialstatements, when read in conjunction with the complete set of financial statementsincluding the notes to the financial statements, is fairly stated in all material respectsin relation to the financial statements from which it has been derived.
Baltimore, MarylandFebruary 25, 2013
101 E. Chesapeake Avenue, Suite 300, Baltimore, Maryland 21286410-583-6990 FAX: 410-583-7061
Website: www.Rowles.com
BALTIMORE COUNTY EMPLOYEES FEDERAL CREDIT UNION Condensed Statements of Financial Condition
As of December 31, 2012 and 2011
2012 2011AssetsCash and cash equivalents $ 19,342,473 18,814,597 Loans to members, net 147,131,152 149,707,718 Investment securities available for sale 15,731,817 10,479,318 Investment securities held to maturity 118,233,359 103,623,075Certificates of deposit in other financial institutions 13,479,000 15,151,000National Credit Union Share Insurance Fund deposit 2,844,438 2,691,499Property and equipment 4,241,281 4,105,025Prepaid expenses and other assets 2,715,596 2,184,572
Total assets $ 323,719,116 $ 306,756,804
Liabilities and Members’ EquityMembers’ share accounts $ 294,777,719 $ 278,388,674 Accured expenses and other liabilities 2,478,122 2,985,110
Total liabilities 297,255,841 281,373,784
Members’ equityRegular reserve 3,458,704 3,458,704Undivided earnings 25,202,558 24,335,064Accumulated other comprehensive income (2,197,987) (2,410,748)
Total members’ equity 26,463,275 25,383,020
Total liabilities and members’ equity $ 323,719,116 $ 306,756,804
$
These condensed financial statements do not constitute a complete presentation. The complete set of audited financial statements, including the notes to the financial statements, are available at the Credit Union office during normal hours of operation.
BALTIMORE COUNTY EMPLOYEES FEDERAL CREDIT UNION Condensed Statements of Income
Years Ended December 31, 2012 and 2011
Interest incomeInterest on loans $ 7,735,985 $ 8,149,391 Interest on investments 2,500,903 2,786,735
10,236,888 10,936,126 Interest expenseDividends on members’ shares 3,011,029 3,806,686
Net interest income 7,225,859 7,129,440
Provision for loan losses 591,500 666,000
Net interest income after provision for loan losses 6,634,359 6,463,440
Noninterest incomeCard services 1,322,073 1,287,657 Share draft fees 686,570 698,095 Rental income 107,603 90,010Other 593,024 475,781
2,709,270 2,551,543
Noninterest expensesCompensation and benefits 3,917,923 3,920,715 Office occupancy 631,745 638,800 Office operations 2,040,892 1,789,368 Education and promotion 167,891 185,451 ATM operating expense 752,026 666,025NCUSIF stabilization 270,222 672,875 Other 695,436 575,002
8,476,135 8,448,236
Net income $ 867,494 $ 566,747
2012 2011
These condensed financial statements do not constitute a complete presentation. The complete set of audited financial statements,including the notes to the financial statements, are available at the Credit Union office during normal hours of operation.
BALTIMORE COUNTY EMPLOYEES FEDERAL CREDIT UNION Condensed Statements of Changes in Members’ Equity
Years Ended December 31, 2012 and 2011
Balance, December 31, 2010
Net income
Defined benefit plan adjustment
Unrealized gains on investments available for sale
Balance, December 31, 2011
Net income
Defined benefit plan adjustment
Unrealized gains on investments available for sale
Balance, December 31, 2012
Regular reserve
$ 3,458,704
3,458,704
$ 3,458,704
Undivided earnings
$ 23,768,317
566,747
24,335,064
867,494
$ 25,202,558
(1,829,136)
(655,121)
73,509
(2,410,748)
155,743
57,018
(2,197,987)
Accumulated other comprehensive income
-
-
-
-
-
-
-
-
-
-
-
-
These condensed financial statements do not constitute a complete presentation. The complete set of audited financial statements,including the notes to the financial statements, are available at the Credit Union office during normal hours of operation.
$
$
566,747
232,930 666,000 180,532
1,256,0523
(2,634,576)2,793,258 (214,694)215,819
3,062,071
3,277,990(2,050,129) 3,000,000
(36,902,707)24,202,7931,763,000
(32,792)-
(37,825)
(6,779,670)
8,366,449
4,648,850
14,165,747
18,814,597
BALTIMORE COUNTY EMPLOYEES FEDERAL CREDIT UNION Condensed Statements of Cash Flows
Years Ended December 31, 2012 and 2011
Cash flows from operating activities Net income Items not requiring (providing) cash Depreciation Provision for loan losses Amortization of loan origination fees, net Amortization of premiums and accretion of discounts, net (Gain) loss on disposition of property and equipment Loans originated for sale Cash from loans sold (Increase) decrease in accrued interest and other assets Increase (decrease) in accrued expenses and other liabilities
Net cash provided by operating activities
Cash flows from investing activities Loans made, net of principal collected Purchase of investments available for sale Proceeds from maturity or call of investments available for sale Purchase of investments held to maturity Proceeds from maturity or call of investments held to maturity Net (increase) decrease in certificates of deposit Purchase of property and equipment Proceeds from disposition of property and equipment Increase in NCUSIF fund
Net cash applied to investing activities
Cash flows from financing activities Increase in members’ share accounts
Net increase in cash and cash equivalents
Cash and cash equivalents, beginning of year
Cash and cash equivalents, end of year
867,494
245,976 591,500 71,859
1,232,903(311)
(2,017,848)2,017,848 (531,024)351,245
2,127,152
1,913,207(9,301,620) 4,000,000
(38,739,843)23,002,7951,672,000(382,921)
1,000(152,939)
(17,988,321)
16,389,045
527,876
18,814,597
19,342,473
$
$
$
$
These condensed financial statements do not constitute a complete presentation. The complete set of audited financial statements,including the notes to the financial statements, are available at the Credit Union office during normal hours of operation.
2012 2011
Share SavingsHoliday, Personal, and Vacation ClubsPremier Money MarketIRA SavingsShare CertificatesIRA Share CertificatesYouth Accounts
Looney Tunes SavingsTeen Checking
Special Baby Account –Starter & Gift
MEMBER SERVICESS
avin
gs
Pro
du
cts
Loan Products/Services
Specialty LoansHome CashAuto CashEducation/ComputerPersonal/Preferred Credit Share SecuredRecreational VehicleVacation, Holiday, and more
New and Used Vehicle Loans
Auto-Related Services:UBS – United Buying ServiceMVCP – Motor Vehicle Certification ProgramOne Stop Autos – Credit Union auto loans
taken at dealer showroomsEnterprise Car SalesGAP (Guaranteed Auto Protection)Mechanical Breakdown Protection
Home Equity Loans – Variable rate and Fixed rate options with “no closing costs”
Mortgage Loans – For the purchase or refinance of a home
Sp
ecia
l S
erv
ices
Additional LendingServicesOn-Line Loan applications Pre-qualification CounselingLoan Payment Calculators Disability and Credit Life Insurance
Savings ATM CardChecking ServicesStatement ExpressOverdraft Protection with line of creditCourtesy Pay protection coverageSmartCash VISA Check CardQuickTeller – Audio Response, On-Line
Account Access, and Bill PaymentMobile BankingCredit Union ATMs – Towson and Perry HallATM Network Affiliations featuring over
40,000 no-surcharge Allpoint ATMsDirect Deposit / Payroll DeductionAutomatic Transfer – payroll deduction for
our non-county government members
ACH – Automated Clearing House –electronic transfer of funds for example:payrolls, mortgage payments, insurance premiums
Money OrdersNotary PublicPostage StampsVISA Gift CardsCU Succeed Teen NetworkCoin Counting MachineDiscounted Movie PassesDiscounted Theme Park TicketsIncome Tax BookletsEducational Literature Scholarship ProgramSpecial Events
Convenience Services
VISA Platinum Credit Card with CU Rewards and no annual fee
$250,000
WWW.BCEFCU.COM
23 W. Susquehanna AvenueTowson, Maryland 21204
8640 Ridgely’s Choice DriveBaltimore, Maryland 21236
410-828-47301-800-234-4730
EQUAL HOUSING LENDER