BOARD AGENDA #375 April 23, 2009 BOARD – Yvette Rubio, Ian Schachner, Bill Goodman, Suzanne Reine, Sharron Thrasher, Kenny Christianson, Jim Fravil, Diana Drucker, Tom Terrizzi, Alison Christie, Leslie Strebel ABSENT – STAFF – Tristram Coffin, Leni Hochman, Joe Welch, Deirdre Silverman, Eric Levine, Lenore Olmstead, Carol Chernikoff Next Board Meeting: May 28, 6:30PM 1) Review of Agenda 2) Vote on Consent Agenda 3) Guest Presentation a) Judy McIntosh-Mengel, Metzger, Barr 4) Board Votes and Action Items a) Changes to Loan Policy/elimination of unused products (Carol) 5) Discussion a) Financial Update b) Example of Possible New Policy format 6) CEO Update a) Review of Metrics b) Research Visit c) FHLB Home Counseling d) Industry Involvement 7) Reports a) Budget Metrics 8) Committee Reports List of Attachments a) Balance Sheet b) Net Interest Income c) CAMEL Ratios d) Delinquent Loan Report e) Grants Report 1 1) Review of Agenda a) Review and approve Consent Agenda b) Additions and Deletions to Agenda 2) Consent Agenda a) Membership Officer: March 2009 92 NEW 73 CLOSED # of Accounts Closed March 2008 108 97 Reason March 2007 96 118 15 Closed by Collections 58 Closed by MSRs per member’s request # of Accounts Closed Reason 27 Not needed/Not using 8 No Response 8 4 3 3 3 2 Moved/Moving Consolidating Accounts Loan is Paid Off Need the Money Closed Business Statement Fee b) SAR’s Report: Two SAR’s were filed in March 2009. YTD SAR’s total is four. c) Write offs: i) There are 4 loan write offs, totaling $14,269.49 proposed for April, 2009. Our allowance for loan loss is targeted at no more than $15,000.00 monthly. ii) 22 overdrawn account write offs proposed for April 2009 with a total of $1,284.89. Of that, $434.98 is for write off (a real loss) and $850.55 will be a loss of fee income (reversal of fees that have not been paid). Our target for negative accounts is no more than $1,000.00 monthly. iii) The March delinquency rate went up from February –to1.66% from 1.48%. The rate without the secured portion of delinquent loans is 1.19%. Our target is no more than 2.5%. The number of loans on the list went up by 17 and the total dollars delinquent went up $78,207.94. Total loans outstanding went up $789,456.31. (1) Mortgage delinquency went down to 1.26% from 1.40%. (2) Consumer delinquency went down to 1.32% from 1.76%. (3) Business delinquency went up to 5.10% from 0.94%. d) Leslie and Paul Strebel applied for a home equity loan. Board approved loan via e-mail on April 8, 2009. e) Approve minutes of March 26, 2009 2 3) Guest Presentation a) Judy McIntosh-Mengel, Metzger, Barr 4) Board Votes and Action Items a) Statement of Voting Item: Delete mortgage products from Loan Policy that have not been used for a long time. i) If there was a former policy this is overriding, please put here and highlight the changes. Loan Policy, Mortgages, #9 Fresh Start Mortgage #11 100% Mortgage financing #12 All in one rehab Future Value Mortgage #13 40 Year Amortization with 15 year Balloon ii) Rationale for change We have not closed any of these products for a long time (none since Janet has been here). They also all require fixed rate money and we save most of the 30 year fixed rate money (when we have any) for first home club borrowers. Deleting unused products make training easier and more efficient for staff. We will continue to clean up loan policy, remove unused products, move procedures to a procedures manual and make it a more easily useable document. Implementation plan: Delete from Loan Policy COMMITTEE RECOMMENDS THIS. 3 5) Discussion a) Financial Update b) Example of Possible New Policy format 6) CEO Update - Here is a brief recap of recent events at Alternatives: a) Review of Metrics - A copy of the most recent “Alternatives at a Glance” is attached. The VITA program concluded its most successful tax season to date. The write-down of our NCUA deposit has warped our financial picture, however we have received approval of a new secondary capital plan which will allow us to borrow funds to replace that which has been earmarked for the Corporates. Our credit card portfolio sale will be signed this week, and the income should help improve our capital ratio by next quarter. Service quality as measured by our surveys continues to be outstanding. b) Research Visit - Alternatives recently hosted Greg Fairchild, a faculty member from the University of Virginia Business School who is traveling to thirty CDFIs for a major research project to analyze and understand our industry. The visit generated many insights into our success which may be worked into a teaching case study. c) FHLB Home Counseling - Alternatives was recently approved by the Federal Home Loan Bank to conduct homebuyer education for participants in the First Home Club IDA program. Previously we had referred these borrowers to Better Housing of Tompkins County, among others. Not only will this approval allow us to exert greater control over the service levels delivered to clients, but we will be paid $500 per borrower by FHLB for our efforts. Our first payment has been received with several more in the pipeline. d) Industry Involvement - I was recently appointed to the Government Affairs Committee of the Credit Union Association of New York (formerly the League), which involves setting legislative priorities for credit unions at the state level. I will also be participating in a networking meeting of New York CDCUs in Albany to discuss opportunities for collaboration and capacity building. 4 7) Reports Net Income Total Assets Capital Ratio Total Grant Income Delinquency Ratio Charge Loan Offs Overdrawn Accounts March-09 March-09 Month YTD YTD YTD Actual ($332,419) $55,641,835 6.6 $17,187 1.66% $7,500 ($8) Budget $13,788 $56,210,069 7.5 $35,015 2.50% $15,000 $1,000 Variance -2510.93% -1.01% -12.00% -50.92% 33.60% 50.00% 100.80% Actual ($331,293) $80,575 $29,058 $1,150 Budget $118,585 $104,180 $45,000 $3,000 Variance -379.37% -22.66% 35.43% 61.67% 12 11.5 11 10.5 10 9.5 9 8.5 8 7.5 7 6.5 6 5.5 5 4.5 4 4t 1s h t Q Qu t a r 20 t 0 2n 3 er 2 9 r d d 0 0 Q 4t ua Q 2 8 h rt 0 0 Q e 3r ua r 20 8 d q rte 0 2n ua r 2 8 d Q rt 00 4t ua er 2 7 h rt 00 Q 4t ua er 2 7 h rt 0 0 Q e 4t ua r 2 7 h rte 00 Q 4t ua r 2 6 h rt 0 0 Q er 5 ua 2 rte 00 r 2 4 00 3 Axis Title Capital Ratio 5 goal 7.5% or higher Net Income / Provision for Ln Loss 250000 150000 50000 Net Income -50000 Provision for Loan Loss -150000 -250000 -350000 De Ap Au De Ap Au De Ap Au De c- r- g- c- r- g- c- r- g- c05 06 06 06 07 07 07 08 08 08 Capital 10 9 8 7 Total Capital 6 Core Capital 5 4 3 2 1 09/30/2005 06/30/2006 03/31/2007 12/31/2007 09/30/2008 6 Total Assets / Mortgages 60000000 50000000 40000000 Total Assets Mortgages 30000000 20000000 10000000 38625 38806 38990 39171 39355 39538 39721 39903 DQ & Fixed Asset Ratios 7 6 5 Fixed Asset Raio 4 DQ Ratio 3 2 1 09/30/2005 06/30/2006 03/31/2007 12/31/2007 09/30/2008 __________________________________ SECRETARY’S SIGNATURE 7 _____________ DATE 8) Committee Reports 1) Human Resources Committee a) Date: April 10, 2009 b) Present: Barbara Coman, Ian Schachner, Tristram Coffin, Lenore Olmstead c) Absent: Alison Christie, Diana Drucker, Sharron Thrasher d) Next meeting date: Friday, May 8, 2009 at 9 a.m. e) CEO Review - Alison will contact Yvette and Leslie about the status of the CEO Review Team. Some of the issues that need to be further clarified are the time frame of the review and the instruments to be used. Tristram’s anniversary date is July 25th. The review can look at the previous four quarters and the accompanying goals from the strategic plan or decide to move the review time period to the calendar year. The timing of the salary review can be determined with what works best for the CEO and the board. The CEO Review includes metrics related to the strategic plan, a survey of direct reports, and a self-evaluation. What metrics will be used? A suggestion is that the survey should be concise, very specific, and related to effective leadership and supervision. f) Holiday Bonus - We brainstormed about how the board wants to deal with this bonus which is usually given the first pay period in December. This bonus has been $300 for each staff person (pro-rated if hired recently) for last number of years. Alison suggested earlier that we brainstorm guidelines but not bring it to the board until July when we will have more information about the CDFI grant and prospective income for this year. She suggested calling it a year-end bonus. The committee’s suggestion is to make this a board appreciation gift (not a performance-based bonus) with an electronic card signed by all the board members. We will look at this issue in July and if we are dealing with financial problems, this is an area to review for possible cuts. g) Internships - Ian raised issues around how to do effective involvement of Cornell students with Alternatives and how to educate students on the values and career paths at credit unions. Business schools do not seem to know that credit unions exist. Many students at top schools can be debt free and work for non-profits for three or four years before getting an MBA. Ian suggests that we work with the Cornell Tradition program for an intern for the summer who can continue to do service hours during the year. Tristram referred to our work with the Natural Leaders Initiative and that working with Cornell Commitment scholars would be a good addition. h) Quarterly strategic HR goals - We quickly reviewed the status of the following goals: i) Implement new Staff Compensation Plan- (Lenore, Leni) - complete 3/09 ii) Implement Supervisory Coaching Training- (Leni, Lenore) – Initiated by June, 2009 iii) Enhanced Cross-Training commenced (Leni, Lenore, Melissa, Joe, Mary)- Initiated September, 2009 iv) Implement Organizational Diversity Plan- (Lenore, Karl, Leni)- December, 2009 v) Process Improvement Training- (Lenore, Leni, Joe) – Initiated by December, 2009 8 2) Member Service Committee a) Date: April 17, 2009 b) Present: Lane, Suzanne R., Yvette, Leslie, Leni, Melissa, Suzanne C, Tristram c) Absent: d) Next Meeting: Friday, May 22, 2009 11:00. e) Committee Mission Statement: We reviewed Melissa's first revision and she will do further fine-tuning. f) Technology Recommendations i) Tristram introduced the technology recommendations from Peter McCracken and David Makar. There are several interesting ideas, as couple of which we'll move forward with first: (1) Facebook. The idea of a Facebook page seems to have generated the most enthusiasm from staff and board. Other Facebook members could become "fans" of Alternatives. We could use our page as a portal to our website and to other resources. Our Facebook page could also be used as a place for members to interact with one another. (2) Video. The website redesign is already in progress and we plan to add video member testimonials. Member profiles have already become more automated; members now have the ability to log in and update their profiles. (3) Pay It Forward: Tristram told us about Summit CU's (Madison Wisconsin) program. Here's a snippet from their web site: (a) About Pay It Forward (i) People helping people. This is the credit union difference. And at Summit, we’re giving you a chance to experience our credit union values first hand. Throughout the spring we’ll tour our 20 branch locations asking, “If we gave you $10…what would you do for someone else?” (ii) For your answers, we’ll give you $10-free with the assignment to Pay it Forward. (iii)Whatever your plans for the $10, we’ll video tape your intentions and post it on this site. (iv) Website visitors can vote on their favorite video responses. The winner will pocket $500 and Summit will donate $500 to the winner’s charity of choice! (b) Perhaps we could have a similar program? g) Annual Meeting i) This year's Annual Meeting will Building. Suzanne and Karl are local economy. Discussion will health care costs. In an attempt highlight community resources plentiful. take place on June 3rd at the Women's Community planning a panel discussion about the state of our most likely center on housing, transportation and not to completely depress people, we'll be sure to offered to assist people. And balloons will be 9 3) Loan Policy Committee a) Date: April 17, 2009 b) Present: Everett, Bob, Brian, Diana, Leslie, Carol c) Absent: Ian, Kenny, Jim, Mary d) Next meeting date: Friday, May 22, 2009, Noon e) Monthly Reports i) Mortgage – still very busy. 14 closings for $1,271,065, includes 8 1st mortgages, 7 refi’s and 1 purchase. YTD 29 closings for $2,230,439 compared to 2008 19 for $891,252. $3m in process. ii) Consumer-57 loans for $325,569, strong in new and used auto. Numbers are down from 2008. iii) Business- 2 closings for $56,000. YTD 13 loans for $310,100. Merchant services income is down about 20%...a sign of the times. iv) Collections- The rate is 1.66%, up a bit from last month’s 1.48%. Business dq is up due to one large loan. We are meeting with the borrowers next week. $7500 was added to Loan Loss Reserves to establish an allowance for Overdraft Privilege loses. f) New Business i) Loan policy changes See Voting Item: Delete mortgage products from Loan Policy that have not been used for a long time. g) Old Business i) Continue work on mission statement for loan policy committee. These are the ideas from last meeting. Committee members were going to have e-mail conversation about them and work on a statement • • • • • • • • • • Credit path Competitive Practice responsible lending, offer choices in the members best interest Sound lending guidelines, reasonable profits and low loan losses Work toward a successful outcome for the CU, member and community Empowering and educating members about their own finances Address community needs, offer range of products that fill needs Establish a relationship of mutual trust Establish strategic alliances with other organizations and agencies Loan department operates effectively, efficiently with a high level of service quality ii) Diana and Leslie preferred to move this to the next meeting when more members are present. 10 4) Development/Community Relations Committee a) Date: April 2, 2009 b) c) Present: Leslie Strebel, Sharron Thrasher, Tom Terrizzi, Suzanne Cerquone, Karl Graham, Leslie Ackerman d) Absent: e) Next meeting date: May 7, 2009 f) Funding and Program Updates i) Deirdre (1) CDFI - Additional funds allocated to the CDFI Fund as part of the stimulus bill. Grants to be awarded within 90 days. Our application for an additional $1.1 million has been submitted. (2) Decision about AVF Application in 2009 round 2 or 2010 (3) Empire State Development has received $4 million rather than their usual $1.5 million, and will expand their funding to include business services to white men. They haven’t sent out the Request for Proposals yet, but it should mean more money for us. (4) SBA also hasn’t sent us our grant budget for 2009 yet, even though the first quarter report is due this month. (5) New VISTA positions - Approved for 3 new VISTA’s: financial education, VITA, and outreach. Recruitment begins soon. Goal is to have candidates at the latest, prior to the August in-service training. ii) Karl (1) VITA (a) On April 7, Brian Kunk-Czaplicki, VITA VISTA transitions to full time mortgage loan officer. VITA Assistant Site Coordinators, Tanya Garger and Peter Eliason extending their hours. Both are DSS employees and their extra hours will be covered under the DSS funding. (2) ATMs (a) $15,000 grant from NCUA for new and replacement ATMs. We are looking to replace 3 ATM’s and place 2 at new sites: possibly the Dryden Community Café and Gimme in Trumansburg. ShareNet has contacted us again about forming a local group of CUs to join their ATM network. We’re in the process of finding out more information. iii) Suzanne (1) Annual meeting update: Looking at June 2 or 3 as the date (June 3 it is!). After the Ithaca Festival and college graduations. Meeting will feature a panel discussion on the local effects of the economic downturn. We discussed possible panelists, including elected officials, an economic expert from IC or Cornell, and someone to speak on the impact of high health insurance costs. (2) Living Wage - Press conference to announce the living wage update scheduled for Friday, April 24 at 11am. iv) Leslie (1) Two items from the Chamber of Commerce’s Business Information Network meeting this morning. (a) The Showcase Tompkins business fair will be held this year on Wednesday, June 24, 4 to 7pm at the Farmers Market. Last year we had a booth. This year may be an opportunity for board members to work the booth along side staff. (b) The Chamber will publicize and co-sponsor Business CENTS’ 2 part 11 workshop on sales in May. Chamber asked us to forego our sliding scale fee system in favor of a single fee for Chamber members. We declined, feeling that our sliding scale is fairer. g) Community Relations i) Karl (1) Tompkins County Democratic Committee hosting a panel discussion: "Local Implications of the National Economic Crisis", Monday, May 4, 7-9 pm, at the Town of Ithaca Hall. Here’s their event description: We plan 4 panelists, Eric Lerner acting as moderator. Plan on a ten-minute talk on local implications as you see them from your vantage point. When all 4 panelists have completed their tenminute presentations, we will re-convene in 4 small groups, with a panelist and a facilitator in each group. There will be an opportunity for questions and comments in the small groups, as well as the chance to identify any potential follow-up on actions or activities, should those be appropriate. We will end the evening with bringing the large group back together, and hearing a synopsis of each small-group discussion. We will also hand out index cards, and encourage each participant to write something that they want to follow up on to take home with them. (2) Discussion item (a) Yvette, Tristram, and Karl met March 31 with Margo Hittleman and Neisha Butler of Natural Leaders Initiative (NLI) to discuss inclusion and leadership development. A result of our discussion was realization that we need internal discussions to come to consensus on what an inclusive board/committee structure would look like. (i) What would a diverse/inclusive board of directors and committees look like? Some points from the committee’s discussion: 1. Inclusion can have a broader focus than race, gender or class. Politically, we’re fairly homogenous. Can we integrate someone who is politically and socially conservative? If that person supports the mission, we should be able to agree to disagree on other issues. 2. Many boards recruit for specific skills. What skills do our board/committee members need? How does this affect inclusion efforts? 3. It can take a long period of time to learn the many aspects of our business, even for board members who are highly educated. What must we put in place to help less educated persons be successful board members? Mentors and on-going orientation sessions were mentioned. To make it easier for people to attend her program, Margo Hittleman offers child care, meals, and even gives gas cards to those who live outside the city. That is an example of adapting to the needs of low income or single parent families. 4. Rather than bring new members directly onto the board, we can utilize our committees to orient and train potential board members. A way to recruit members who use our community programs is to form advisory boards for those programs. Not only might this yield future committee and board members, it might highlight to the membership that they have an ownership stake in the credit union. ii) Meeting Schedule for 2009: Jun 4, Jul 2, Aug 6, Sep 3, Oct 1, Nov 5, Dec 3 12 5) Budget Committee a) Date: April14, 2009 b) Present: David, Tristram, Joe, Yvette, Mary, Kenny c) Absent: Jim, Leni, Deirdre, Carol d) Next meeting date: Tuesday, May 19, 2009 Noon e) 2009 Meeting Schedule - 6/16, 7/14, 8/18, 9/15, 10/20, 11/17, 12/15 f) Financials: (pp 2-6) i) Balance Sheet (Actual, Budget, Beg Year) ii) Net Interest Income (Month and YTD) iii) CAMEL Ratios iv) QuarterYTD analysis g) Delinquency / Charge offs - (pp 7-8) h) PRESENTATION - FINANCIAL DATA i) UPDATES: i) NCUA EXAM (4/30) ii) Mengel Metzger Barr-audit (4/23) iii) Members United iv) Insurance fund capitalization v) Grants:SBA, ESD, CDFI 13 6) Supervisory Committee a) Date: Wednesday, April 22, Noon b) Present: David Gallahan, Chris Strebel, Bill Goodman and Amy Smith c) Absent: d) Next meeting date: May 13, 2009 at 12:00 PM e) Old Business: i) We do not need a PO Box – we will get the keys and return them to the Post Office. ii) We reviewed the procedure for handling returned mail and decided that there is very little risk regarding returned mail and no need for further action by the committee at this time. iii) We were expecting to see something in the Currents, looking for new committee members – but it wasn’t there. Next time? iv) Here is what we have regarding the authority given to staff: (1) Staff start with $5K limit. For new non-member service staff, this probably won't change. (2) Member Service staff, after successful completion of their probationary period, are usually raised to $10K. (3) At one year, member service staff may be raised to $20K. (4) Vault staff usually have higher limits. (5) Member service supervisors also have higher limits. This means we have to put in our password and approve a large dollar transaction for someone with a lower authority. (6) Certain senior staff have larger passwords, based on their job demands. (7) As for the authority to reverse and delete transactions, we wait until at least the successful completion of the probationary period to grant that authority. v) Amy will follow up with Larry/Joe W. about how we can efficiently review the audit reports (M600, M601) f) New Business: i) We received a member complaint forwarded from the NCUA. Amy will follow up and see what our response should be ASAP. ii) The NCUA examiner requested that we perform an audit of new and closed accounts at least twice a year. We completed our first one 4/4/09. iii) We completed the consumer loan file review (4/21/09), and found no issues. iv) We should have the dormant account report for our next meeting. v) The auditors will be here tomorrow (4/23/09) at 6:30. vi) There is a special board meeting next Thursday for the NCUA examiner to report. 14 7) Governance Committee a) Date: April 2, 2009 b) Present: Bill, Yvette, Tom Alison, Tristram, Eric c) Absent: d) Next meeting date: May 14 Noon ((NOTE: CHANGE FROM REGULAR FIRST THURSDAY SCHEDULE) e) Elections i) results will be announced at Annual Meeting; need to review who will count ballots. f) Policy Manual - looked at Security Policy from existing Manual and reviewed Tristram's draft of new format for policy. i) much discussion of how "Policy Governance" model for policies would be written g) To Be Discussed: i) Articles on Policy Governance ii) Natural Leaders Workshop iii) Officer Candidates 15 ALTERNATIVES FEDERAL CREDIT UNION BALANCE SHEET 03/31/2009 02/28/2009 Budget 03/31/2009 12/31/2008 Column 1#3 ASSETS 1 2 3 4 Consumer Mortgage Business TOTAL LOANS 5 6 7 ALLOWANCE FOR LOAN L Allowance for ODP losses TOTAL ALLOWANCE FOR LOAN LOSS 8 9 10 8,675,968 24,763,709 2,364,195 35,803,871 8,646,590 23,995,178 2,372,294 35,014,062 7,740,029 23,138,658 2,453,326 33,332,014 8,663,518 23,663,993 2,355,435 34,682,947 12.09% 7.02% (3.63%) 7.42% (339,667) (7,500) (347,167) (338,383) 0 (338,383) (311,366) 0 (311,366) (316,700) 0 (316,700) 9.09% 0.00% 11.50% Misc Loan Fees Receivable Misc Receivables - Other MISC REC. (12,935) 81,474 68,539 67,847 84,565 152,412 33,591 103,099 136,690 953 72,706 73,659 (138.51%) (20.97%) (49.86%) 11 12 13 14 15 Checking (TCTC & FHLB) Vault Cash ATM - Cash Clearing Acounts TOTAL CASH 120,843 365,354 91,720 72,038 649,955 108,692 282,800 148,980 329,835 870,307 72,802 401,569 130,000 428,238 1,032,609 92,593 325,575 68,540 2,274 488,982 65.99% (9.02%) (29.45%) (83.18%) (37.06%) 16 INVESTMENTS 16,021,619 15,645,814 18,234,784 17,018,135 (12.14%) 17 18 19 20 21 PRE-PAID INSURANCE CAPITALIZED CLOS C HELOC MISC PRE-PAID AND DE Prepaid Real Estate Taxes PREPAID 3,435 70,277 60,061 41,419 175,192 6,870 68,801 69,303 46,902 191,877 10,000 67,434 60,000 20,000 157,434 13,740 70,255 24,738 23,795 132,528 (65.65%) 4.22% 0.10% 107.09% 11.28% 22 23 24 25 26 Land Building Building Improvements Furniture and Equipment FIXED ASSETS 588,364 2,094,924 80,448 169,100 2,932,836 588,364 2,100,430 80,755 175,943 2,945,492 588,364 2,094,957 80,493 172,615 2,936,429 588,364 2,111,441 81,370 189,629 2,970,804 0.00% (0.00%) (0.06%) (2.04%) (0.12%) 27 Accrued Interest Income 199,312 192,527 241,476 215,992 (17.46%) 28 NCUA SHARE INSURANCE 137,678 468,222 450,000 468,222 (69.40%) 55,641,835 55,142,330 56,210,069 55,734,569 (1.01%) 155,839 51,869 912,964 1,120,672 157,234 48,175 915,120 1,120,529 167,380 64,553 949,017 1,180,950 231,225 60,431 922,222 1,213,878 (6.90%) (19.65%) (3.80%) (5.10%) 1,120,672 1,120,529 1,180,950 1,213,878 (5.10%) 13,680,189 21,163,692 10,166,964 5,839,113 50,849,959 13,453,957 20,653,203 10,124,555 5,790,444 50,022,158 13,804,206 20,370,885 10,626,145 5,688,334 50,489,570 14,055,788 20,200,399 10,589,192 5,676,852 50,522,231 (0.90%) 3.89% (4.32%) 2.65% 0.71% TOTAL ASSETS LIABILITIES 29 30 31 32 ACCOUNTS PAYABLE ACCRUALS Borrowings Payables TOTAL LIABILITIES EQUITY 33 34 35 36 37 SHARE DRAFT MEMBER SHARES CERTIFICATES IRA'S Total Deposits 38 Secondary Capital 1,851,000 1,843,000 2,233,154 1,843,000 (17.11%) 39 40 41 42 43 REGULAR RESERVE UNDIVIDED EARNINGS UNREALIZED GAIN/LOSS GENERAL SUSPENSE OTHER CAPITAL 551,000 1,266,801 3,556 (1,153) 1,820,204 551,000 1,601,404 4,239 (0) 2,156,643 551,000 1,756,496 (1,100) 0 2,306,396 551,000 1,600,278 4,182 0 2,155,461 0.00% (27.88%) (423.28%) 0.00% (21.08%) TOTAL EQUITY 54,521,163 54,021,801 55,029,119 54,520,691 (0.92%) LIABILITIES+EQUITY 55,641,835 55,142,330 56,210,069 55,734,569 (1.01%) ALTERNATIVES FEDERAL CREDIT UNION Net Interest Income Budget 03/31/2009 03/31/2009 03/2009 YTD Budget 03/2009 YTD INTEREST INCOME 1 2 3 4 Mortgage Business Consumer INTEREST ON LOANS 5 INVESTMENTS TOTAL INTEREST INCOME 126,480 16,932 70,467 213,878 128,983 15,754 70,761 215,498 374,060 47,933 210,668 632,661 374,680 45,712 212,049 632,441 29,632 39,257 88,555 111,486 243,510 254,755 721,216 743,928 5,293 26,605 632 15,000 47,531 5,978 28,080 575 14,432 49,066 15,031 80,419 1,921 43,328 140,699 17,881 82,510 1,726 42,127 144,244 47,531 49,066 140,699 144,244 195,979 205,689 580,517 599,684 7,500 15,000 29,058 45,000 7,500 188,479 15,000 190,689 29,058 551,459 45,000 554,684 INTEREST EXPENSE 6 7 8 9 10 SHARE ACCOUNTS CD's SHARE DRAFT IRA' and ROTH'S DIVIDENDS TOTAL INTEREST EXPENSE NET INTEREST INCOME 11 PROVISION FOR LOAN LOSS TOTAL LOSS PROVISION NET AFTER LOSS PROVISION OPERATING EXPENSES 12 SALARIES 141,397 139,500 409,346 418,500 13 BENEFITS 28,650 35,920 110,484 121,420 14 TRAINING / TRAVEL 4,813 4,734 9,742 14,176 15 ASSOCIATION DUES 1,801 2,030 7,241 6,074 16 BUILDING 16,937 19,112 56,439 57,312 17 PROMOTION 4,361 7,000 10,795 21,000 18 OPERATING 34,064 35,521 106,489 107,514 19 LOAN SERVICING 11,358 13,013 40,072 45,502 20 PROFESSIONAL SERVICES 347,055 8,213 361,923 24,615 21 NON-PROFIT PROGRAMS 1,081 569 3,542 1,726 22 23 24 INTEREST ON SBA BORROWINGS INTEREST ON SUB-DEBT INTEREST ON BORROWINGS 1,821 9,452 11,274 1,653 10,000 11,653 5,672 27,907 33,580 4,835 30,000 34,835 25 OVERDRAFTS 7,492 1,000 8,650 3,000 610,282 278,265 1,158,302 855,674 34,422 7,750 906 17,187 25,094 4,025 89,384 37,950 6,075 1,100 35,015 20,074 1,150 101,364 93,000 18,811 2,945 80,575 74,545 5,675 275,550 112,584 18,225 3,200 104,180 71,261 110,125 419,576 89,384 101,364 275,550 419,576 0 0 0 0 TOTAL OPERATING EXPENSE OTHER OPERATING INCOME 26 27 28 29 30 31 32 DEPOSIT FEES LOAN FEES MISC FEES GRANT AND OTHER INCOME VISA FEES MISC INCOME FEES INCOME TOTAL OTHER OP INCOME TOTAL NON-OP EXP/INC NET INCOME (332,419) 13,788 (331,293) 118,585 ALTERNATIVES FEDERAL CREDIT UNION CAMEL RATIOS MEASURE 03/31/2009 12/31/2008 09/30/2008 06/30/2008 03/31/2008 12/31/2007 09/30/2007 06/30/2007 03/31/2007 12/31/2006 09/30/2006 06/30/2006 03/31/2006 12/31/2005 09/30/2005 CAMEL KEY RATIOS CAPITAL ADEQUACY Capital/Ttl Assets Core Cap/Ttl Assets > 7% 6.60 3.27 7.17 3.87 7.21 3.87 6.84 3.73 7.04 3.77 7.03 3.54 7.21 3.47 7.15 3.40 7.37 3.48 7.54 3.49 7.99 3.70 8.42 3.70 9.00 4.13 9.23 4.36 9.54 4.36 1.66 93.27 5.27 1.88 92.77 5.33 3.02 92.31 5.45 3.06 92.31 5.40 3.49 90.73 5.69 5.13 90.90 5.93 4.47 90.92 6.06 4.03 90.62 6.06 4.84 90.49 6.13 3.43 90.14 6.37 4.34 90.32 6.48 2.73 90.46 6.53 3.05 90.66 6.63 4.26 90.74 6.45 2.40 90.96 6.55 7.18 1.43 0.16 12.79 7.49 1.43 0.24 6.05 7.85 1.36 0.42 5.69 8.66 1.49 0.17 5.84 13.19 1.86 0.39 6.58 8.38 1.84 0.47 5.66 8.10 1.67 0.41 5.58 8.33 1.64 0.29 6.23 10.03 1.77 1.31 6.11 8.21 1.64 3.15 5.57 7.65 1.45 0.43 5.63 8.29 1.52 4.12 6.25 7.79 1.55 2.96 6.49 7.93 1.31 0.01 5.83 7.73 1.33 0.41 5.83 70.41 31.25 68.65 30.58 67.98 30.06 65.30 28.31 65.82 29.62 67.12 31.01 68.12 30.84 66.52 29.63 68.30 29.87 71.18 30.57 73.34 30.60 74.13 30.28 74.95 29.54 73.01 27.67 76.95 29.04 7.13 1.12 2.21 7.31 1.21 2.68 7.44 1.18 1.44 7.55 1.34 2.55 8.27 1.45 3.27 7.59 1.50 4.25 7.70 1.39 4.58 7.81 1.46 4.37 7.84 1.50 4.75 7.21 1.44 4.42 7.35 1.36 4.15 7.58 1.30 3.92 7.20 1.32 3.63 7.27 1.26 3.33 6.86 1.14 3.23 ASSET QUALITY DQ Loans/Ttl Loans Earning Assets Fixed Assets/Total Assets < 5% EARNINGS Income / Assets Cost of Funds/Assets Loan Losses / Total Assets Operating Exp/Assets LIQUIDITY Loans/Deposits Mortgages / Assets OTHER RATIOS Operation Statistics Loan Inc / Loans Dividends / Deposits Inv Inc / Investmnt GRANTS PROGRESS REPORT April, 2009 Name Assets for Independence Town of Dryden Comm. Fnd. Women’s Fund Wells Fargo Housing Foundation United WayBank of Amer OTADA Acctg firm donations UAW Local 2300 IRS VITA grant Tompkins County Cornell University Citizens Bank County CDBG CDFI Fund 2009 NFCDCU HUD 2008` NCUA Application Status Awarded 9/07 Approved Applied 3/09 Amount Requested/ Granted $58,824 G mostly match funds $10,000 G Most for matching $1,000 G to AVF $10,000 G to AVF Approved $1730 G Approved $1923 $500 $100 $500 G G G G Approved Anticipated Funding Date Rec’d 4/23/08 Commitment from AFCU Offer IDAs Duration IDAs Early 2009 Offer IDAs ? VITA 3/10/09 Offer VITA 1 year Money Wise and financial counseling VITA Late 2009 Expand MW and FC 1 year Rec’d 2/9/09 Offer VITA 1 year Offer VITA 1 year, to AVF Offer VITA 1 year Rec’d 3/30/09 Rec’d 2/20/09 Rec’d 3/11/09 1 /22/09 VITA VITA Applied 8/29/08 $7,500 G Part of Federation plus consulting $ Tax program Approved 12/08 Applied 12/08 Approved 3/6/09 Approved 2004 $10,000 to AVF $10,000 to AVF $2,000 to AVF $25,000 G G Applied 10/29, add’l 3/26/09 Approved 10/3/08 Approved 9/08 $2,000,000 G Capital, LLR, operations $45,000 may increase $15,000 G “ G ATM purchase Empire State Development Awarded 11/15/06 $60,000 G $6,000 grant $54,000 interest subsidy Empire State Development Applied 11/29/07 Approved 2/21/08 ??? $95,000 Approved 9/30/99 $121,800-Year 9 $95,578-Year 10 $130,642-Year 11 Empire State Development 2009 SBA Microloan Intermediary Program 402 404 508 Program (if any) IDA 5 years Offer VITA 1 year Tax program $ 3750 1/21/09 50% 5/09 $400 for consulting rec’d 3/3/09 Rec’d 4/16/09 Offer VITA 1 year Tax program Mid-2009 Offer VITA 1 year G Tax program Rec’d 3/18/09 Offer VITA 1 year G Business loans & CENTS $5,467 rec’d 1/19/06 $4,630 rec’d 9/17/08 $6,070 rec’d 3/18/09 Late 2009 Assist rural county businesses Open $13,328 rec’d 3/2/09 $13,292 billed 4/15 By 5/ 09 Reimbursement Offer programs Outreach, ATMs 1 year, renewable $1800 of grant and $16200 of interest rec’d 4/07; $18,000 rec’d 10/6/08 $18,000 rec’d 2/5/09 $47,500 rec’d 10/28/08, remainder in mid-2009 Lend to women & minority owned businesses “ 2 years Billing quarterly $24,601 rec’d 6/08 $22,030 rec’d 10/08 $17,401 rec’d 11/08 $31,546 billed 1/09 Expand business lending On going ” Interest rate subsidy for business loans G CENTS, IDA, Tax, LLR 3 years by 4/30/09 1 year ?? CEO, Business Lending ALTERNATIVES AT A GLANCE Mission: Build wealth and create opportunities for underserved people and communities Values: Social Justice, Provide Economic Products that Give Real Value, Innovation, Community-Minded, Risk Taking, Balance, Inclusion, Education DIVISIONAL PRIORITIES CURRENT BUSINESS PRIORITIES 1. New Credit Card Program(Mary) Finance METRICS ACTUAL GOAL - Enhance Operating 2. Cons. Lending through MSS YTD 2009 Effectiveness (Melissa) Community o Response to NCUA 3. ATM Service Expansion(Karl) #Tax Returns 1,500 1,500 o Internal Analysis & 4. Benchmarking Study(Leni) #IDAs Open-FHC 10 45 Reporting 5. Research CU Collaboration(Joe) New VITA accounts 44 80 o Reconciliations 6. Expand Outreach (Karl) # Service 11 18 o ALM tools 7. Develop Organizational Diversity Partnerships Plan (Lenore) Lending Financial - Revolutionize the process! 8. Supervisory Coaching (Lenore) Capital Ratio 6.60% 7.99% DIVISIONAL ACTIVITIES o Simplified application Net Income (331,293) $185,000 Finance o Faster underwriting DQ Ratio 1.66% 2.5% o Expanded distribution - Divisional Reporting Grant Income 80,575 $414,990 Lending o “back office” efficiency Making Life Easier - Product Line Maintenance Community Programs - Bring Alternatives to the Service Quality 81% 72% Community Programs Members! More Members, Products, Services o Growth to new markets Operations Total Assets $55.6MM $57.6M o Increase grant income & Sec. # of Members 9,000 9,200 - Marketing plan implementation/MCIF Capital # of New Unbanked 300 o Involve Staff in Outreach QUEUE LIST Members 1. Incorporate Credit Path in Member o Support Sustainability efforts Mortgage Loans 3,716,797 Relationship Mgmt. Operations Consumer Loans 2,783,582 2. Consider New Programs to address - be unique/Exceptional service! Business Loans 1,496,482 recession impact for mbrs. o Enhance Service Quality Premier Workplace o Distribution through MSS COMPLETED BUSINESS Employee 1.71 1.90 o Operational efficiency PRIORITIES Satisfaction 1. Overdraft Privilege o Deliver Education to Diversity 17% 20% 2. New Staff Compensation Plan Members Employee Retention 90% 75% New Council 3. New Marketing Plan - Premier Workplace! METRICS ACTUAL YTD GOAL 2009 Community #Tax Returns 1,500 #IDAs Open-FHC 45 New VITA accounts 80 # Service 18 Partnerships Financial Capital Ratio 7.99% Net Income $185,000 DQ Ratio 2.5% Grant Income $414,990 Making Life Easier Service Quality 71% 72% More Members, Products, Services Total Assets $57.6M # of Members 9,200 # of New Unbanked 300 Members Mortgage Loans Consumer Loans Business Loans Premier Workplace Employee Satisfaction Diversity 19% 17% Employee Retention 90% 80%