CUSC of Alabama Board Meeting
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Mar 15, 2016
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CUSC of Alabama Board Meeting
CUSC Of Alabama Board Meeting
December 13, 2012 - LSCU Offices AGENDAI. CALL TO ORDERII. CONSENT AGENDA
A. Adoption of MinutesB. Treasurer's Report
1. September and October 2012 StatementsC. Management ReportD. 2012 Strategic PlanE. Informational Items
III. BUSINESSA. Election of OfficersB. Brand Campaign ResultsC. 2013 Strategic PlanD. 2013 Proposed BudgetE. Cash Banking UpdateF. Dashboard Reporting Template
IV. ADJOURMENTV. EXECUTIVE SESSION
I. CALL TO ORDER
II. ADOPTION/APPROVAL OF CONSENT AGENDA
A. MINUTES
O F A L A B A M AFor: BOARD OF DIRECTORS MEETING
Location: LSCU Offices
Date: October 17, 2012
MEETING AGENDA
CALL TO ORDER AND ROLL CALL The Board of Directors Meeting of CU Service Centers, Inc. was called to order by Chairman Patrick La Pine on Wednesday, October 17, 2012 at 9:00 a.m. in the library of the LSCU Birmingham office.
Mr. La Pine asked Mrs. Tameka Dukes to call roll.
The following Directors were in attendance at the meeting:
Ms. Linda Cencula, CEO, AL Telco CU Mr. Heath Harrell, CEO, Guardian CU Mr. Patrick La Pine, CEO, LSCU Mr. Merrill Mann, CEO, APCO CU Mr. Ned McHenry, CEO, AL State Employees CU Mr. Steve Nix, CEO, First Educators CU Mr. Shane Nobbley, CEO, Family Security CU Mr. Joe McGee, CEO, Legacy Community CU
Mr. Monte Hill, CEO, Family Savings CU, attended the meeting by phone.
CONSENT AGENDA Mr. La Pine stated the Consent Agenda contained the minutes of the August 16, 2012 CUSC, Inc. Board Meeting and the Treasurer’s report accompanied with the July and August 2012 financial statements.
Motion was made by Mr. Steve Nix and seconded by Ms. Linda Cencula to approve the Consent Agenda as presented.
MANAGEMENT REPORT Mr. Patrick La Pine stated that the 20th Annual Meeting is fastly approaching and it should have great attendance. He reported that over 300 attendees have registered for the Leadership Development Conference with majority of the attendees with Alabama credit unions. He also stated that with having so many attendees CUSC of Alabama should have a record high number of attendees at the Annual Meeting. Mrs. Dukes stated that invites were sent to 60 non-participating credit unions to attend the Annual Meeting in conjunction with the Leadership Development Conference.
Mrs. Dukes stated that Birmingham Police CU was live and transactions were going well for their members. She also stated the signed agreement has been received from Five Star CU and they plan to be live by the end of January 2013. With Birmingham Police CU and Five Star CU joining the network that will bring our participating credit unions to 53. However, by the end of January with Milestone CU and Alabama Credit Union merging it will bring the number of Issuer credit union in Alabama back to 52.
Mrs. Dukes also stated that two communications have been sent to participating credit unions regarding the policy changes effective January 1st. The Alabama network will remove all in-state policies and procedures and strictly follow the CO-OP Shared Branching Network rules.
She stated training continues with participating credit unions. The Central Alabama training has been scheduled for November 27th and she asked that every credit union sends staff. The training will discuss the upcoming changes with the policies and procedures for shared branching.
O F A L A B A M AMrs. Dukes stated that CO-OP Shared Branching will be hosting a sales forum in late October and management will be attending. The forum will give an updated on many products and also discuss the future of shared branching while focusing on pricing and the overall 2013 plans.
BUSINESS
Update on 2012 Strategic & Marketing Plan Mr. Scott Morgan explained that management continues to make great progress with growing the network. He stated that when comparing August 2011 and August 2012 transactions the Alabama network is up by 30% with transactions. Also, income is up by 17%when comparing August 2011 and August 2012.
Mr. Morgan stated that Alabama continues to do a great job of marketing to credit unions and now it is time to focus on increasing marketing to the credit union members. CUSC of Alabama plans to help credit unions market and educate their members through a shared branching video. He stated that the video will be presented at the Annual Meeting. The video link will be sent to credit unions to use in their lobbies and on social network sites.
Cash Banking Product Mr. Morgan briefly discussed the Cash Banking product. He stated that there was an issue that has come up with the platform. He stated that we cannot move forward until the legal issues with the platform are resolved or a new platform is created. He hopes that the platform issue will be resolved before year end. He stated that he will keep the board updated.
Demographic Mapping Mr. Morgan updated the board on the demographic mapping. He stated that of the 51 credit unions 16 have not sent their member address information after numerous requests. He asked the board help to contact the 16 credit unions to request and explain why the addresses are needed. Mr. Morgan explained how important it is to have all participating credit unions to send this information so the mapping data can be accurate to use during the sales process with non-participants.
There was continued discussion about the demographic mapping project.
Outlet Approval Motion made by Mr. Merrill Mann and seconded by Mr. Shane Nobbley to approve the outlet equest for one location: Heritage South CU at 2825 Moody Parkway in Moody, AL.
Remaining 2012 Board Meetings Mr. La Pine updated the Directors with the remaining board meeting dates and locations.
Mr. Morgan brought up about the Investment policy that is in place. He asked the Directors thoughts about the level of risks with CUSC of Alabama investments. There was brief discussion about Members Trust Investments and CUSC of Alabama. The Directors stated that we need to continue to research all investment options and discuss further. Mr. Morgan that he will schedule a meeting with a representative of Members Trust and the board to further discuss the options available.
UNFINISHED BUSINESS There was no unfinished business.
ADJOURNMENT The meeting adjourned at 9:55 a.m.
Respectfully submitted, Steve Nix, Secretary Tameka Dukes, Recording Secretary
B. TREASURER’S REPORT
CUSC OF ALABAMA TREASURER’S REPORT
Executive Summary October 31, 2012
Income Statement
CUSC of Alabama has produced operating results that have exceeded budget through October 31, 2012. Year to date revenues are at $465,708 as compared to a budget of $449,707, which is tracking $16,001 or 3.6% ahead of budget. Average monthly transaction volume for 2012 is tracking 22% higher than for the monthly average in 2011. Year to date expenses of $150,417 were lower than budget and produced a $20,916 positive variance to budget. The positive revenue and expense results produced a solid year to date Net Income after Taxes of $264,904 as compared to a budget of $204,851.
For the months of September and October, revenue of $417,425 and $465,708 were a combined ($270) lower than budget. Total expenses for September and October tracked 11.84% lower than budget largely a result of lower than budgeted travel, meetings expense and management costs. This produced a Net Income after taxes for September and October of $20,125 and $30,652 respectively which was favorable to budget by a combined $1,175.
417
150
267
33
234
404
171
233
54
179
13 2134
21
55
0
50
100
150
200
250
300
350
400
450
Revenue Expenses Earnings BeforeIncome Tax
Income Tax Net Income
CUSC of Alabama ‐ Components of Net Income as of October 31, 2012
YTD Actual, YTD Budget & Positive Variance to Budget (in $thousands)
YTD Actual Results YTD Budget Positive Variance Compared to Budget
Balance Sheet
CUSC of Alabama ended October with $3,682,941 in assets with 97.7% of these assets in Cash and, Short-term Investments. Since October 31 of 2011, assets for the corporation have increased by 5.3%.
Overall, the balance sheet presents a healthy picture. Total equity is in excess of $3,597,531, an increase of $158,111 from October 2011. Current assets exceed $3,682,941 while current liabilities are approximately $85,410 producing a current ratio of 43.12. As of the end of October, CUSC of Alabama has recorded a 7.2% Return on Assets.
Balance SheetOctober 31, 2012
Current Assets
CashOperating Cash 1,565,077Short Term Investments 2,033,000
Total Cash 3,598,077
Accounts Receivable 63,114
Total Accounts Receivable 63,114
Prepaid ExpensePrepaid Insurance 3,267Prepaid Other 18,483
Total Prepaid Expense 21,750
Net Fixed Assets 0
Total Net Fixed Assets 0
Total Assets $3,682,941
LIABILITIES & EQUITY
Accounts Payable 20,091Dividends and Patronage Rebate Payable 0Accrued Expenses 939CU Service Corp. Invoices 32,798Federal Income Tax Payable 23,829State Income Tax Payable 7,753
Total Liabilities 85,410
EquityCommon Stock 67Paid in Capital 3,349,933RETAINED EARNINGS (17,373)Net Gain (Loss) Curent Year 264,904
Total Equity 3,597,531
Total Liabilities & Equity $3,682,941
M-T-D Actual M-T-D Budget Budget Variance Y-T-D Actual Y-T-D Budget Budget Variance Annual Budget
OPERATING INCOMENon-Investor Fees 1,211 1,100 111 11,528 10,940 588 13,140Licensed Service Centers 46,397 44,000 2,397 448,578 433,100 15,478 521,600Interest Income 675 567 108 5,586 5,667 (81) 6,800Other Income 0 0 0 16 0 16 0Patronage Rebates 0 0 0 0 0 0 (130,141)
Operating Income 48,283 45,667 2,616 465,708 449,707 16,001 411,399
OPERATING EXPENSE
TrainingUser/Outlet Training 0 650 650 266 3,350 3,084 3,750
Total Training 0 650 650 266 3,350 3,084 3,750
TravelTravel & Lodging 494 300 (194) 2,080 3,400 1,320 4,000Meals & Entertainment 66 150 84 431 1,500 1,069 1,800Variable Auto Costs 375 250 (125) 1,129 2,500 1,371 3,000
Total Travel 935 700 (235) 3,640 7,400 3,760 8,800
Outside ServicesLegal Services 500 500 0 5,000 5,000 0 6,000Data Processing 67 250 183 672 2,500 1,828 3,000CPA Services 1,241 1,350 109 12,431 13,500 1,069 16,200Management Service Fees 6,458 7,000 542 65,748 70,000 4,252 84,000Reports/Records Management 671 950 279 9,412 12,000 2,588 13,900Insurance/Bonds/O&S 351 350 (1) 3,197 3,500 303 4,200Other Outside Services 166 300 134 1,795 4,400 2,605 5,000
Total Outside Services 9,454 10,700 1,246 98,255 110,900 12,645 132,300
CommunicationsTelephone 145 200 55 1,487 2,000 513 2,400Postage 146 300 154 1,229 3,000 1,771 3,600
Total Communications 291 500 209 2,716 5,000 2,284 6,000
Advertising & PromotionsAdvertising & Marketing 1,200 700 (500) 30,672 32,450 1,778 34,150Total Advertising & Promotion 1,200 700 (500) 30,672 32,450 1,778 34,150
Furniture & EquipmentFurniture & Equipment Depr. 78 110 32 838 1,100 262 1,320Equipment/Lease Rental 271 275 4 2,715 2,750 35 3,300Personal Property Tax 0 200 200 43 200 157 200Software Fees & Maintenance 1,195 0 (1,195) 1,195 1,078 (117) 1,076
Total Furniture & Equipment 1,544 585 (959) 4,791 5,128 337 5,896
FacilitiesInsurance/POP 69 100 31 686 1,000 314 1,200Rent 299 300 1 2,993 2,992 (1) 3,592
Total Facilities 368 400 32 3,679 3,992 313 4,792
Materials & SuppliesOperating Supplies 98 150 52 1,730 1,500 (230) 1,800
Total Materials & Supplies 98 150 52 1,730 1,500 (230) 1,800
Programs & ConferencesMeetings & Conferences 39 0 (39) 8,594 11,000 2,406 15,500
Total Programs & Conferences 39 0 (39) 8,594 11,000 2,406 15,500
MiscellaneousDonations 0 0 0 10,000 5,000 (5,000) 5,000
Total Miscellaneous 0 0 0 10,000 5,000 (5,000) 5,000
Taxes & FeesMisc. Taxes & Fees 0 0 0 4,204 3,200 (1,004) 3,200Federal Income Taxes 2,931 4,536 1,605 24,501 45,362 20,861 54,434State Income Taxes 771 1,057 286 7,756 10,574 2,818 12,689
Total Taxes & Fees 3,702 5,593 1,891 36,461 59,136 22,675 70,323
Total Operating Expenses 17,631 19,978 2,347 200,804 244,856 44,052 288,311
Net Income 30,652 25,689 4,963 264,904 204,851 60,053 123,088
Income StatementFor the Ten Months Ending
October 31, 2012
Credit Union Service Centers, Inc.Balance Sheet
September 30, 2012
Current Assets
CashOperating Cash 1,534,206Short Term Investments 2,033,000
Total Cash 3,567,206
Accounts Receivable 56,679
Total Accounts Receivable 56,679
Prepaid ExpensePrepaid Insurance 3,687Prepaid Other 19,724
Total Prepaid Expense 23,411
Net Fixed Assets 78
Total Net Fixed Assets 78
Total Assets $3,647,374
LIABILITIES & EQUITY
Accounts Payable 16,500Dividends and Patronage Rebate Payable 0Accrued Expenses 982CU Service Corp. Invoices 35,135Federal Income Tax Payable 20,898State Income Tax Payable 6,982
Total Liabilities 80,497
EquityCommon Stock 67Paid in Capital 3,349,933RETAINED EARNINGS (17,373)Net Gain (Loss) Curent Year 234,250
Total Equity 3,566,877
Total Liabilities & Equity $3,647,374
M-T-D Actual M-T-D Budget Budget Variance Y-T-D Actual Y-T-D Budget Budget Variance Annual Budget
OPERATING INCOMENon-Investor Fees 1,059 1,100 (41) 10,317 9,840 477 13,140Licensed Service Centers 40,531 43,500 (2,969) 402,182 389,100 13,082 521,600Interest Income 691 567 124 4,910 5,100 (190) 6,800Other Income 0 0 0 16 0 16 0Patronage Rebates 0 0 0 0 0 0 (130,141)
Operating Income 42,281 45,167 (2,886) 417,425 404,040 13,385 411,399
OPERATING EXPENSE
TrainingUser/Outlet Training 0 200 200 266 2,700 2,434 3,750
Total Training 0 200 200 266 2,700 2,434 3,750
TravelTravel & Lodging 135 300 165 1,586 3,100 1,514 4,000Meals & Entertainment 14 150 136 366 1,350 984 1,800Variable Auto Costs 114 250 136 754 2,250 1,496 3,000
Total Travel 263 700 437 2,706 6,700 3,994 8,800
Outside ServicesLegal Services 500 500 0 4,500 4,500 0 6,000Data Processing 67 250 183 605 2,250 1,645 3,000CPA Services 1,241 1,350 109 11,190 12,150 960 16,200Management Service Fees 6,457 7,000 543 59,291 63,000 3,709 84,000Reports/Records Management 671 950 279 8,742 11,050 2,308 13,900Insurance/Bonds/O&S 351 350 (1) 2,846 3,150 304 4,200Other Outside Services 218 1,000 782 1,629 4,100 2,471 5,000
Total Outside Services 9,505 11,400 1,895 88,803 100,200 11,397 132,300
CommunicationsTelephone 145 200 55 1,341 1,800 459 2,400Postage 247 300 53 1,084 2,700 1,616 3,600
Total Communications 392 500 108 2,425 4,500 2,075 6,000
Advertising & PromotionsAdvertising & Marketing 0 850 850 29,472 31,750 2,278 34,150Total Advertising & Promotion 0 850 850 29,472 31,750 2,278 34,150
Furniture & EquipmentFurniture & Equipment Depr. 78 110 32 760 990 230 1,320Equipment/Lease Rental 271 275 4 2,443 2,475 32 3,300Equipment Install./ Maint. 0 0 0 0 0 0 0Personal Property Tax 0 0 0 43 0 (43) 200Software Fees & Maintenance 0 1,076 1,076 0 1,076 1,076 1,076
Total Furniture & Equipment 349 1,461 1,112 3,246 4,541 1,295 5,896
FacilitiesInsurance/POP 69 100 31 617 900 283 1,200Rent 299 300 1 2,694 2,692 (2) 3,592
Total Facilities 368 400 32 3,311 3,592 281 4,792
Materials & SuppliesOperating Supplies 77 150 73 1,632 1,350 (282) 1,800
Total Materials & Supplies 77 150 73 1,632 1,350 (282) 1,800
Programs & ConferencesMeetings & Conferences 2,500 0 (2,500) 8,556 11,000 2,444 15,500
Total Programs & Conferences 2,500 0 (2,500) 8,556 11,000 2,444 15,500
MiscellaneousDonations 5,000 0 (5,000) 10,000 5,000 (5,000) 5,000
Total Miscellaneous 5,000 0 (5,000) 10,000 5,000 (5,000) 5,000
Taxes & FeesMisc. Taxes & Fees 0 0 0 4,204 3,200 (1,004) 3,200Deferred Tax Expense 0 0 0 0 0 0 0Federal Income Taxes 2,931 4,536 1,605 21,570 40,825 19,255 54,434State Income Taxes 771 1,057 286 6,984 9,517 2,533 12,689
Total Taxes & Fees 3,702 5,593 1,891 32,758 53,542 20,784 70,323
Total Operating Expenses 22,156 21,254 (902) 183,175 224,875 41,700 288,311
Net Income 20,125 23,913 (3,788) 234,250 179,165 55,085 123,088
Income StatementFor the Nine Months Ending
September 30, 2012
C. MANAGEMENT REPORT
To: CUSC, Inc. Board of Directors
From: Tameka Dukes
Date: October 17, 2012
Subject: Management Report
Network Development
The Business Development staff and management continues to visit with non-participating credit unions to discuss shared branching in hopes that shared branching is a part of their budgeting plan for 2013. Birmingham Police CU were trained in September and came live as an Issuer on October 1st. This brings the total number Issuers on the AL network to 52 participating credit unions.
Milestone CU and Alabama CU will merge effective January 31, 2013. There is not a clear understanding if Milestones Fultondale outlet location will remain at this time.
The first round of notices regarding the new policy changes (in-state check policy/offline policy) taking effect on January 1, 2013 were sent at the end of August. The changes have been well received so far. Management will continue to send notifications of the changes as the date nears.
CUSC Issuer/Acquirer training continues within participating credit unions. There have been numerous on-site trainings at credit unions. The Central Alabama training is tentatively scheduled for November 27th with more details to come at a later date.
All CUSC Investors should have received the 20th Annual Meeting notices at the beginning of October. Also, invites have been sent to 25 non-participating credit unions inviting them to the CUSC Annual meeting so they can hear the progress of the CUSC of Alabama network over the last year.
CO-OP Shared Branching Update
CO-OP Shared Branching will be holding a two-day Business Development Forum on Monday, October 22nd - 23rd. Management will go to represent the Alabama Network. In this forum CO-OP plans to give an update on many products and also discuss the future of Shared Branching while focusing on pricing and the overall 2013 plans.
D. 2012 STRATEGIC PLAN
2012 Objectives
• Provide Alabama credit unions with an efficient and cost-effective delivery network for transactional memberservices.
• Grow the number of issuer credit unions on the network.• Grow the number of transactions performed by
participating credit unions in the network.• Investigate new sources of revenue for the corporation
and participating credit unions.
Market Opportunity
• Many credit unions in Alabama do not know the value ofshared branching.
• Shared branching can be an additional layer for a creditunion’s disaster plan.
• There are 83 Alabama credit unions and 300 branchesthat are not currently participating in the sharedbranching network.
• Cost to build branches or obtain branches is increasing.
Market Opportunity
Where Outlets Are Needed:
• Birmingham – Forestdale/Adamsville & Leeds/Moody &Huffman
• Jasper – between Forestdale & Jasper• Auburn• Between Birmingham & Tuscaloosa
*The demographic research will identify additional gapsbased on current participation within the state.
2012 Strategies
OperationsPriorities Key Activities Progress Update
Product Mix Research and develop newtransactional products and services.
In discussion with New Market Partners on revenue flows and contracts for the Cash Banking product.
Pricing Continue to examine pricing of ashared branch transaction to ensuretransaction cost remains competitive.
Discussed at the planning session. Bd. Approved increase in patronage rebate & decreased outlet pricing by .10 cents effective January 2013.
Certification Reimbursement
Examine opportunities to reimburseusers for certification fees to jointhe network.
In discussion w/ CO-OP SB about possibly waiving set-up fees and some monthly costs. The offers would come with a deadline for the credit union to join the network.
Operations (Con’t)Priorities Key Activities Progress Update
Training & Support
Review current training and look for ways to improve delivery to network credit unions. Utilize webinars for training both Issuers & Acquirers.
Expand delivery of onsite training to network credit unions.
Completed Central AL training class (November). Completed South AL (July) training class. Management is currently setting up webinar trainings.
User Survey Create and disseminate a yearly user survey to gauge user satisfaction with the network.
The survey has been created and will be sent out by the end of December 2012.
Outlets Target new outlet locations in areas where service gaps exist.
Utilize demographic analysis to assist with outlet placement.
Data collection maps to becompleted & given to credit unions by end 1st quarter 2013.
MarketingPriorities Key Activities Progress Update
Sponsorships Look for opportunities to exhibit at League and other system partner events.
CUSC sponsored Disaster Recovery in Montgomery in April. Also exhibited at the LSCU Convention & also exhibited & sponsored breakfast at LDC in November.
Credit Union Member Awareness
Assist credit unions in educating members about shared branching and provide key information to members.
Created a video for credit unions to use in lobby & social networks.Investigating ways we can be a partner in the education process of members.
Sales Kit & Brochures
Create sales kit that includes general information to join the Alabama network as Issuer/Acquirer.
Design brochures for CU’s that can be placed in new member packets.
Sales folder & brochure has been developed to leave with non-participating credit unions on sales meetings/visits.
Priorities Key Activities Progress UpdateNetwork Growth Develop an aggressive outreach plan to attract
non-participating credit unions onto the network.
Utilize demographic data as a sales tool forincreased credit union participation.
Plan is almost complete. As soon as the maps are available, the planned outlet targets will be included in the plan.
Conservation Complete a network business review with each user on a yearly basis.
Review information is being compiled for each participant.
Non-User Contacts Visit ¼ of non-users on a quarterly basis.
Work with Leverage sales team to target newparticipants.
CU Visits sof far for 4th qtr• Marvel City• US Pipe EFCU• Bessemer• Birmingham Police CU• Infirmary CU• Progressive FCU• Mobile.• Five Star CU• IAM CU• McIntosh• NUCOR• Chattahoochee FCU.
Sales Training Conduct two training sessions each year onshared branching with Leverage sales staff tofacilitate sales process.
Staff has completed one training session and the other is scheduled later in the month of December
Sales
Priorities Key Activities Progress UpdateResources Develop a chart of Leverage
resource assignments for performance of CUSC activities by end of 1st quarter.
LEVERAGE resources chart has been developed.
Consolidation Research the advantages and disadvantages of consolidating CUSC with the Florida Credit Union Shared Services (FCUSS).
FCUSS has decidedto proceed with hiring areplacement CEO.
Structure & Governance
2012 Key Performance Measures
Goals Target ActualOutlet Growth 10 New Outlets Total of 9 outlets approved for 2012.
New Issuers 4 New Issuers Five Star CU will be live 1st quarter of 2013.B’ham Police CU is live.Working with Chattahoochee, Blue Flame, Infirmary CU, Progressive FCU to add them to the network.
Transactions 895,000 financial transactions processed by the network.
As of the end of October, 897,000 financial transaction have been processed by the network.
Pricing Strategy Review
Complete by beginning of 4th Quarter. Discussed with the board at the Board Planning Session. The board voted to reduce the cost of the acquirer transaction by .10.
2012 Key Performance Measures (KPMs)
Goals Target Actual
Outlet Income Increase outlet income by 5% As of the end of October, revenue has increased by 7%
User Data Mapping Complete and disseminate demographic map data to network users by end of 4th
Quarter
Management is currently geocoding the most recent data received from participants
Conservation Complete network review visit with each user by end 4th
Quarter
CUSC has reviews scheduled for December to complete process.
Sales Plan Complete sales plan. Management has been working with LEVERAGE sales staff to create plan.
2012 Key Performance Measures (KPMs)
E. INFORMATIONAL ITEMS
2013 Meeting Dates
All meetings are at the LSCU offices in Birmingham and begin at 9:00am (except the Annual Meeting)
• Thursday, February 21st
• Friday, April 26th
• Thursday, June 6th
• Tuesday, August 13th
• Thursday, October 24th
• Annual Meeting - Friday, November 8th at 7:30am inconjunction with the LSCU Leadership DevelopmentConference in Point Clear
• Tuesday, December 10th
III. BUSINESS
A. ELECTION OF OFFICERS
Board Election Results
The following board members were re-elected at the Annual Meeting to serve three-year terms:
• Linda Cencula, Alabama Telco CU
• Heath Harrell, Guardian CU
• Ned McHenry, Alabama State ECU
Current CUSC of Alabama Officers
• Patrick La Pine, Chairman
• Linda Cencula, Vice Chair
• Shane Nobbley, Treasurer
• Steve Nix, Secretary
B. BRAND CAMPAIGN RESULTS
Cooperative Image Campaign Results
• This year, the campaign ran from mid-June to late August.• 113 credit unions participated, included 34 new contributors.• $1.25 million was raised from CUs for media buys.• Post-campaign consumer survey shows solid gains.
– AL/FL CUs have seen credit union awareness collectivelyrise from 23% to 50%.
• Additionally, the campaign’s online behavioral targeting adsproduced 105,000 click-thrus, utilizing YouTube marketingbrought more than 96,000 views of the TV ad, and Facebookproduced 12,000 click-thrus.
• During this same timeframe, AL/FL CUs have collectivelygained 195,000 new members and $3.6 billion in assets.
A Closer Look at the Numbers
Alabama:• 29% Pre-campaign awareness in August, 2011• 35% Post-campaign awareness following wave one in
September, 2011• 59% Post-campaign awareness following wave two in August,
2012
Florida:• 19% Pre-campaign awareness in August, 2011• 26% Post-campaign awareness following wave one in
September, 2011 • 41% Post-campaign awareness following wave two in August,
2012
C. 2013 STRATEGIC PLAN
2013 Plan Priorities
• Continue to provide credit union support for all shared branching needs.
• Continue to provide Alabama credit unions with an efficient and cost-effective delivery network for transactional member services.
• Grow the number of issuer credit unions on the network.• Grow the number of transactions performed by
participating credit unions in the network.• Investigate new sources of revenue for the corporation
and participating credit unions.
Market Opportunity
• Many credit unions in Alabama do notknow the value of shared branching.
• Shared branching can be an additionallayer for a credit union’s disaster plan.
• Costs to build, obtain and operatebranches are increasing.
Market Opportunity (continued)
Where Outlets Are Needed:• Birmingham – Forestdale/Adamsville & Leeds/Moody &
Huffman• Jasper – between Forestdale & Jasper• Auburn• Between Birmingham & Tuscaloosa *• Guntersville *• Selma *
* From the 2011 CUSC participants survey**Demographic project will assist in identifying additional gaps in service.
2013 Strategies
OperationsPriorities Key Activities Progress Update
Product Mix Research and develop newtransactional products and services.
Participant Audits Audit participant website and location for adherence to network standards and guidelines.
Certification Reimbursement
Examine opportunities to reimburseor waive certification fees to jointhe network.
Operations (Continued)
Priorities Key Activities Progress Update
Training & Support
Expand delivery of onsite training to network credit unions. Utilizing webinars and online (interactive) training modules so training is easily accessible for credit unions.
Cash Banking Complete business plan and obtain approval from board. Implement product.
Outlets Target new outlet locations in areas where service gaps exist and utilize demographic analysis to assist with outlet placement.
Vision & Mission Statement
Create Vision and Mission statement for AL Network by end of 1st Qtr.
MarketingPriorities Key Activities Progress Update
Sponsorships Look for opportunities to exhibit at League, chapter, and other system partner events. (i.e. LSCU AC&E, LSCU Leadership Development Conference, Corporate America Annual Meeting)
Credit Union Member Awareness
Assist credit unions in educating tellers & members about shared branching. Focus on awareness to credit union members.
Marketing Material
Make available the latest marketing materials to all participating & non-participating credit unions.
Priorities Key Activities Progress UpdateNetwork Growth Work with LEVERAGE sales staff to target
non-participating credit unions.
Conservation Complete a network business review with each user on a yearly basis.
Sales Training Conduct two training sessions each year onshared branching with Leverage sales staff tofacilitate sales process.
Sales
Priorities Key Activities Progress Update
User Data Mapping
Complete and disseminate demographic map data to network users by end of 1st Qtr.
Sales Plan Complete sales plan for adding new participants by end 1st Qtr.
Sales (continued)
Goals 2013 Target 2013 Actual/UpdateOutlet Growth 10 New Outlets
New Issuers 6 New Issuers
Transactions Increase financial transactions processed by the network by 10%. (1,115,000 for 2013)
2013 Key Performance Measures (KPMs)
D. 2013 Proposed Budget
2013 Strategic Priorities
1. Increase transaction volumes by 10%.2. Increase participants in the CUSC network by 6.3. Increase awareness and value of the CUSC of Alabama
brand.4. Aid participants in marketing shared branching to their
members.5. Research additional products to add to the CUSC
product mix.
2013 Budget Summary
Net Income• Net income after tax and patronage rebates for the network is
forecasted to decrease by ($32,883) . Largely due to reduced transaction pricing and a proposed half-time administrative position.
Revenues• Total revenue for the network will decrease in 2013 by ($13,148) or
3.8%.• The network charge for an acquirer transaction was reduced by 20%
starting in 2013.• CUSC transactions are forecasted to increase in 2013. The projection
includes some possible growth in transactions from additional participants and some anticipated organic growth planned for 2013.
• Lower patronage rebates in 2013. Due to lower net income.
2013 Budget Summary (continued)
Expenses2013 expenses are forecasted to increase $19,736 or 8.2% over 2012 projected.• Management Services – expenses are forecasted to increase by $25,780 in
2013 as a part of a proposed half-time administrative position.– The proposed primary duties for the new position follow the 2013
budget slides.• Rent, Data Processing, Equipment/Lease – to increase by a combined
$6,825 as a part of a proposed half-time administrative position.• Training – training expenses are forecasted to increase by $7,740 in 2013.
– Increased training sessions per the 2013 Strategic Plan and the network is additionally investigating a training module to assist with on-line training.
• Postage – postage is expected to increase by $1,352– Additional mail outs in 2013 as a
part of the marketing initiatives.
Proposed Budget
20112012 -
ProjectedBudget -
2013
Revenue 407,564 341,664 328,516
Training 1,787 1,000 5,100Travel 3,776 5,660 9,300Outside Services 113,252 118,150 143,930Communications 4,028 3,259 4,400Marketing 46,706 33,450 32,700Asset Management 24,715 9,951 15,200Material & Supplies 877 2,075 3,300Meetings & Confereces 4,378 9,125 10,000Miscellaneous 0 10,000 11,700Taxes 28,464 49,662 26,438
Net Income 179,581 99,331 66,448
Three-year Comparative - Revenues
2011 2012 2013REVENUE SOURCES ACTUAL PROJECTED BUDGET
Non-Investor Fees 12,556 13,834 14,850
Licensed Service Center Fees 505,944 538,294 438,399
Interest Income 4,874 6,703 8,220
Other Income 6,853 19 0
Patronage Rebates 122,661 217,186 132,953
Total Revenue 407,566 341,664 328,516
Three-year Comparative - Expenses
20112012 -
ProjectedBudget -
2013
Training 1,787 1,000 5,100Travel 3,776 5,660 9,300Outside Services 113,252 118,150 143,930Communications 4,028 3,259 4,400Marketing 46,706 33,450 32,700Asset Management 24,715 9,951 15,200Material & Supplies 877 2,075 3,300Meetings & Confereces 4,378 9,125 10,000Miscellaneous 0 10,000 11,700Taxes 28,464 49,662 26,438
Total Expenses 227,983 242,332 262,068
Patronage Rebate/Dividend Synopsis
2012 Projected 2013 Budget
Patronage Rebates 217,186 132,953
NIBT 144,790 88,636
Income Tax 45,459 22,188
Net Income 99,331 66,447
Total Stockholder Dividend 36,198 22,159
Stockholder Dividend per share 540 331
Equity
Projected Budget2012 2013
Common Stock & AdditionalPaid in Capital 3,350,000 3,350,000
Stockholder's Equity 3,395,761 3,440,049
Equity as % of Initial Capital 101.37% 102.69%
New Position – Half-Time Admin.Primary Functions:
Help control shared branching Issuers/Acquirers to provide quality service to shared branching members and participating credit unions. Insure adherence to all established policies and procedures by all Service Center Issuers/Acquirers. Assist Manager in any needed duties.
Major Duties and Responsibilities:• Develop and maintain a proper professional relationship with all participating credit unions.• Assist Manager with completing/scheduling to perform new and old outlet audits, when needed.• Assist with providing monthly operational training to participating credit union personnel, as needed.
(Webinars/Conference Call Training)• Provide monthly/quarterly transaction reports to the Manager.• Assist the Accounting Department reports and invoicing issues, as needed. • Assist with support of operational and accounting issues with participating credit unions with shared
branching transactions.• Assist with demographic analysis mapping and marketing efforts for CUSC of AL.• General Office Support – support calls, support emails, completing paperwork for credit unions
joining the network (Issuers/Acquirers), getting timely communications out to credit unions, preparing materials for training classes/conferences, etc.
• Perform other duties as needed.
E. CASH BANKING UPDATE
CASH BANKING
• Received approval from NCUA for concept and use of CUSC of Alabama as a CUSO per NCUA Reg, 714.
• New Market Partners (Cash Banking System provider) and it’s technology platform provider dissolved partnership.
• New Market Partners obtained a new platform provider.• Conference calls began again about the product.• CUSC management and New Market partners are
working out contract details and money flow.• Once these details are complete, the business plan can
be completed and submitted to the board.
E. DASHBOARD REPORTING TEMPLATE
TOTAL TRANSACTIONS ISSUER TRANSACTIONS
Revenues
ExpensesRevenues
REVENUES NET INCOME
NUMBER OF OUTLETS
October31,2012CUSCofAlabamaDashboard January31,2012
ACQUIRER TRANSACTIONS ALABAMA CREDIT UNIONS NETWORK NOTES
0
10,000
20,000
30,000
40,000
50,000
60,000
31-J
an-1
22-
Feb-
124-
Feb-
126-
Feb-
128-
Feb-
1210
-Feb
-12
12-F
eb-1
214
-Feb
-12
16-F
eb-1
218
-Feb
-12
20-F
eb-1
222
-Feb
-12
24-F
eb-1
226
-Feb
-12
28-F
eb-1
21-
Mar
-12
3-M
ar-1
25-
Mar
-12
7-M
ar-1
29-
Mar
-12
11-M
ar-1
213
-Mar
-12
15-M
ar-1
217
-Mar
-12
19-M
ar-1
221
-Mar
-12
23-M
ar-1
225
-Mar
-12
27-M
ar-1
229
-Mar
-12
31-M
ar-1
22-
Apr-
124-
Apr-
126-
Apr-
128-
Apr-
1210
-Apr
-12
12-A
pr-1
214
-Apr
-12
16-A
pr-1
218
-Apr
-12
20-A
pr-1
222
-Apr
-12
24-A
pr-1
226
-Apr
-12
28-A
pr-1
230
-Apr
-12
2-M
ay-1
24-
May
-12
6-M
ay-1
28-
May
-12
10-M
ay-1
212
-May
-12
14-M
ay-1
216
-May
-12
18-M
ay-1
220
-May
-12
22-M
ay-1
224
-May
-12
26-M
ay-1
228
-May
-12
30-M
ay-1
21-
Jun-
123-
Jun-
125-
Jun-
127-
Jun-
129-
Jun-
1211
-Jun
-12
13-J
un-1
215
-Jun
-12
17-J
un-1
219
-Jun
-12
21-J
un-1
223
-Jun
-12
25-J
un-1
227
-Jun
-12
29-J
un-1
21-
Jul-
123-
Jul-
125-
Jul-
127-
Jul-
129-
Jul-
1211
-Jul
-12
13-J
ul-1
215
-Jul
-12
17-J
ul-1
219
-Jul
-12
21-J
ul-1
223
-Jul
-12
25-J
ul-1
227
-Jul
-12
29-J
ul-1
231
-Jul
-12
2-Au
g-12
4-Au
g-12
6-Au
g-12
8-Au
g-12
10-A
ug-1
212
-Aug
-12
14-A
ug-1
216
-Aug
-12
18-A
ug-1
220
-Aug
-12
22-A
ug-1
224
-Aug
-12
26-A
ug-1
228
-Aug
-12
30-A
ug-1
21-
Sep-
123-
Sep-
125-
Sep-
127-
Sep-
129-
Sep-
1211
-Sep
-12
13-S
ep-1
215
-Sep
-12
17-S
ep-1
219
-Sep
-12
21-S
ep-1
223
-Sep
-12
25-S
ep-1
227
-Sep
-12
29-S
ep-1
21-
Oct
-12
3-O
ct-1
25-
Oct
-12
7-O
ct-1
29-
Oct
-12
11-O
ct-1
213
-Oct
-12
15-O
ct-1
217
-Oct
-12
19-O
ct-1
221
-Oct
-12
23-O
ct-1
225
-Oct
-12
27-O
ct-1
229
-Oct
-12
31-O
ct-1
2
140,000
145,000
150,000
155,000
160,000
165,000
170,000
175,000
180,000
185,000
190,000
195,000
31-J
an-1
22-
Feb-
124-
Feb-
126-
Feb-
128-
Feb-
1210
-Feb
-12
12-F
eb-1
214
-Feb
-12
16-F
eb-1
218
-Feb
-12
20-F
eb-1
222
-Feb
-12
24-F
eb-1
226
-Feb
-12
28-F
eb-1
21-
Mar
-12
3-M
ar-1
25-
Mar
-12
7-M
ar-1
29-
Mar
-12
11-M
ar-1
213
-Mar
-12
15-M
ar-1
217
-Mar
-12
19-M
ar-1
221
-Mar
-12
23-M
ar-1
225
-Mar
-12
27-M
ar-1
229
-Mar
-12
31-M
ar-1
22-
Apr-
124-
Apr-
126-
Apr-
128-
Apr-
1210
-Apr
-12
12-A
pr-1
214
-Apr
-12
16-A
pr-1
218
-Apr
-12
20-A
pr-1
222
-Apr
-12
24-A
pr-1
226
-Apr
-12
28-A
pr-1
230
-Apr
-12
2-M
ay-1
24-
May
-12
6-M
ay-1
28-
May
-12
10-M
ay-1
212
-May
-12
14-M
ay-1
216
-May
-12
18-M
ay-1
220
-May
-12
22-M
ay-1
224
-May
-12
26-M
ay-1
228
-May
-12
30-M
ay-1
21-
Jun-
123-
Jun-
125-
Jun-
127-
Jun-
129-
Jun-
1211
-Jun
-12
13-J
un-1
215
-Jun
-12
17-J
un-1
219
-Jun
-12
21-J
un-1
223
-Jun
-12
25-J
un-1
227
-Jun
-12
29-J
un-1
21-
Jul-
123-
Jul-
125-
Jul-
127-
Jul-
129-
Jul-
1211
-Jul
-12
13-J
ul-1
215
-Jul
-12
17-J
ul-1
219
-Jul
-12
21-J
ul-1
223
-Jul
-12
25-J
ul-1
227
-Jul
-12
29-J
ul-1
231
-Jul
-12
2-Au
g-12
4-Au
g-12
6-Au
g-12
8-Au
g-12
10-A
ug-1
212
-Aug
-12
14-A
ug-1
216
-Aug
-12
18-A
ug-1
220
-Aug
-12
22-A
ug-1
224
-Aug
-12
26-A
ug-1
228
-Aug
-12
30-A
ug-1
21-
Sep-
123-
Sep-
125-
Sep-
127-
Sep-
129-
Sep-
1211
-Sep
-12
13-S
ep-1
215
-Sep
-12
17-S
ep-1
219
-Sep
-12
21-S
ep-1
223
-Sep
-12
25-S
ep-1
227
-Sep
-12
29-S
ep-1
21-
Oct
-12
3-O
ct-1
25-
Oct
-12
7-O
ct-1
29-
Oct
-12
11-O
ct-1
213
-Oct
-12
15-O
ct-1
217
-Oct
-12
19-O
ct-1
221
-Oct
-12
23-O
ct-1
225
-Oct
-12
27-O
ct-1
229
-Oct
-12
31-O
ct-1
2
Balance Sheet (in $ thousands)Cash 1,565.1Short-term Investments 2,033.0Other Current Assets 84.9
Current Assets 3,682.9Fixed Assets 0.0
Total Assets 3,682.9
Accounts Payable 52.9Accrued Current Liab 32.5
Current Liabilities 85.4Non-Current Liab 0.0
Total Liabilities 85.4
Total Equity 3,597.5Total Liab & Equity 3,682.9
M‐T‐D Actual M‐T‐D Budget Budget Variance Y‐T‐D Actual Y‐T‐D Budget Budget Variance
OPERATING REVENUE 48,283 45,667 2,616 465,708 449,707 16,001
OPERATING EXPENSE
Training 0 650 650 266 3,350 3,084Travel 935 700 581 3,640 7,400 3,558Outside Services 9,454 10,700 1,958 98,255 110,900 9,503Communications 291 500 250 2,716 5,000 1,967Advertising & Marketing 1,200 700 (500) 30,672 32,450 1,778Furniture & Equipment 1,544 585 (959) 4,791 5,128 337Facilities 368 400 32 3,679 3,992 313Materials & Supplies 98 150 52 1,730 1,500 (230)Meetings & Conferences 39 0 (39) 8,594 11,000 2,406Donations 0 0 0 10,000 5,000 (5,000)
Total Expense 13,929 14,385 2,025 164,343 185,720 17,716
Taxes 3,702 5,593 20,498 36,461 59,136 18,893
Net Income 30,652 25,689 4,963 264,904 204,851 60,053
Income Statement
100,000
150,000
200,000
250,000
300,000
350,000
400,000
450,000
500,000
Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12
100,000
120,000
140,000
160,000
180,000
200,000
220,000
240,000
260,000
280,000
Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12
100,000
110,000
120,000
130,000
140,000
150,000
160,000
170,000
180,000
190,000
200,000
Jan-12 Feb-12 Mar-12 Apr-12 May-12 Jun-12 Jul-12 Aug-12 Sep-12 Oct-12
51
71
Participants Non-Participants
100
120
140
117125 131
2010 2011 2012
A link to the CUSC video has been emailed to participating CU's following the annual meeting.
38,000
40,000
42,000
44,000
46,000
48,000
50,000
52,000
Jan‐12 Feb‐12 Mar‐12 Apr‐12 May‐12 Jun‐12 Jul‐12 Aug‐12 Sep‐12 Oct‐12
Revenues
Actual Budget
38,000
40,000
42,000
44,000
46,000
48,000
50,000
52,000
Jan‐12 Feb‐12 Mar‐12 Apr‐12 May‐12 Jun‐12 Jul‐12 Aug‐12 Sep‐12 Oct‐12
NET INCOME
Actual Budget
IV. ADJOURNMENT
V. EXECUTIVE SESSION
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