Annual Report 2018

Annual Report 2018

Statements of Income
Years Ended December 31, 2018 and 2017​

2018

2017
INTEREST INCOME
Interest on Loans $1,323,696 $1,245,606
Interest on Investments 1,083,473 1,001,646
TOTAL INTEREST INCOME 2,407,169 2,247,252
INTEREST EXPENSE
Dividends on Members’ Share Accounts 361,829 275,807
NET INTEREST INCOME 2,045,340 1,971,445
PROVISION FOR (recovery of) LOAN LOSSES 1,897,110 83,641
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 148,230 1,887,804
FEE AND OTHER OPERATING INCOME 437,534 497,451
NON-INTEREST EXPENSE
Compensation and Benefits 994,356 1,059,758
Office Occupancy and Operations 861,647 830,836
Professional Fees 117,965 116,681
Travel and Conference 15,811 17,020
Publicity and Promotion 38,236 17,549
Loan Servicing 21,059 13,018
Other 306,075 229,494
TOTAL NON-INTEREST EXPENSE 2,335,149 2,284,356
NET INCOME(LOSS) (1,769,385) 100,899

Statements Of Financial Condition
Years Ended December 31, 2018 and 2017

2018

2017
ASSETS
Cash and cash equivalents $3,317,564 $5,110,041
Certificates of Deposit 19,461,865 22,608,516
Investment Securities – held to maturity 17,316,238 17,441,238
Investment Securities -available for sale 8,839,818 9,175,300
Investments in Credit Union Service Organizations 246,878 245,487
Loans Receivable, net 30,021,660 29,123,776
Accrued Interest Receivable 274,552 273,762
Furniture and Equipment, net $11,965 $12,912
NCUSIF Deposit 680,973 688,830
Member Capital Share Deposit 80,594 80,594
Prepaid Expenses and Other Assets 1,214,448 1,301,138
TOTAL ASSETS $81,466,555 $86,061,594
LIABILITIES AND MEMBER’S EQUITY
LIABILITIES
Members’ Shares $72,798,943 $75,580,486
Accrued Expenses and Other Liabilities 1,364,314 1,437,020
TOTAL LIABILITIES 74,163,257 76,859,790
Members’ Equity, Substantially Restricted 7,303,298 9,201,804
TOTAL LIABILITIES AND MEMBERS EQUITY $81,466,555 $86,061,594

TOP

Chairman’s Report 2018

For 2018, Metro’s story is a tale of two results.  First, on an operating basis we had a good year, making our budget target.  Higher interest rates and higher loan balances contributed to a healthy Net Income operationally.  We believe we turned the corner from a couple of years of less than desired results, and expect better earnings in 2019.

Set against the good results operationally, we have had to set aside reserves for some loans made to NY City Taxi companies, who have seen large drops in income due to competition from the likes of Uber and Lyft.  The call-services have caused serious problems for the taxi industry as the values of Taxi Medallions have dropped.  Several very large Credit Unions that focused on Taxi Medallion loans have failed in the last two years.  While we are not exposed to such a level, we have to record losses due to non-performing loans, and in 2018, as in 2017, we took a large charge to cover them.

Despite these disappointing charges, we remain very healthy and in good shape.  We are increasing our Membership Groups and moving forward with new Media and web services.  With assets around $80-85M we are larger than about 70% of all Federal Credit Unions.

For detailed financial information, please see our Treasurer’s Report and Audited Financials.

I want to thank Management , Staff, and our Volunteers for their dedicated service to Metro’s membership.

Sincerely,

Robert G. Morrison

Chairman

TOP

Treasurer’s Report 2018

Although the economy remained strong for 2018 and is expected to continue for the New Year, there are signs of global economic weakness.  As a result, the Fed has taken a cautious approach not to increase rates for 2019, some even suggest that rates could decrease.

In last year’s Treasurer’s Report, based on the projected rise in rates, we expected the Credit Union and our Savings member to benefit and our Borrowing member to bear the expense. With the change in rate projections, we expect to see a reversal of fortune where Borrowers should gain in 2019. The Credit Union will focus on higher yielding loan products to increase income and should benefit from a full year of Commercial Real Estate loans disbursed in 2018.

Greater Metro’s Net-Worth Ratio decreased to 10.95% as of December 31, 2018, which is still considered very well capitalized by our regulator, the NCUA. The decrease was due to the Credit Union taking a proactive approach in further addressing the drop in Taxi Medallion Values by reserving additional amounts on our Taxi Medallion Participation loan portfolio.  Even though we are seeing a stabilizing of the values and expect some increases, we have positioned our reserves to negate any future charges.

The Board of Directors and Management continue to be diligently focused on the safety and financial stability of the Credit Union, so as to ensure Greater Metro continues to be a strong membership institution. Our goal is to bring financial products and services to a growing membership base and we are working with our sponsor groups towards this end.

Included in this Annual Report are Greater Metro’s Statements of Financial Condition and Operations for the years ended December 31, 2018 and 2017. They are accompanied by an unmodified opinion from our Independent Auditors. For a complete report, please submit a written request to the Credit Union.  Should you have any question, please contact me at mduffy@greatermetrofcu.org

Respectfully,

 

Monica Duffy

Treasurer

Chairperson Asset Liability Committee

TOP

Report of the Supervisory Committee

The Credit Union Supervisory Committee consists of volunteer members appointed by the Board of Directors. The Supervisory Committee acts as a link between the board, management, and the membership. Any member who feels that their concerns are not being appropriately addressed, may escalate them to the Committee. In 2018 the volunteers were Thomas Amato, the Chairman, Thomas McCarthy, Andrea Nelson, John Forster and Vincent D’Agostino.

Once appointed by the Board of Directors, this Committee acts independently of the Board and carries out its oversight duties on behalf of the membership. In addition to providing a link to the members, the Supervisory Committee engages the public accounting firm of Wojeski & Co.to conduct an annual opinion audit of the Credit Union’s financials. In the course of this audit they are able to assess whether Management is effectively carrying out the plans and policies established by the Board. As usual, it’s worthwhile noting that Credit Unions are not required to have this financial opinion audit until they reach $500 million in assets. Your Volunteers and Management have always believed that this more extensive review is a way of further safeguarding the assets of the Credit Union.

Included in this Annual Report is a condensed version of our audited financial statements along with an unmodified opinion from our auditors, Wojeski & Co. The complete version of Wojeski’s Audited Report of the 2018 Financial Results may be obtained by requesting them from the Credit Union in writing.

In addition to the Annual Audit, the Supervisory Committee also engages Wojeski & Co. to perform monthly on-site internal reviews of specific aspects of the Credit Union’s operations.

The Supervisory Committee is established to serve all members, and to respond to any concerns or questions that may arise. The Committee may be independently contacted at:

Supervisory Committee
Greater Metro Federal Credit Union
31-10 37th Avenue, Suite 403
Long Island City, New York 11101

An email address is also available for members to contact the Supervisory Committee to voice any concerns or complaints. The address is: supervisorycommittee@www.greatermetrofcu.org

 

Thomas Amato
Chairman

TOP

President’s Report – 2018

As is always the case, we strive to provide our members with the best personal service while offering better than market rates on savings and loans as well as delivering products that fit into the busy lives of our members. We therefore continue to enhance our electronic capabilities from Membership Sign-up to On-line Banking, “Bill Pay”, Remote Deposit Capture and our Mobile App.

Our financial health and strength is measured by our net worth ratio. At the end of 2018 it stood at 10.95% which is considered “Very Well Capitalized” by our regulator, the NCUA. The ratio is a bit down from 2017 due to the Credit Union reserving more against our Taxi Medallion loan portfolio. This action was taken to put the worst of what was once a profitable component of income behind us.

Our reputational health and strength is measured by the loyalty and trust of members who continue to use us to meet their financial goals. By all indications, we are succeeding at this as well and are working to add more members so that they can take advantage of what we have to offer.

As we move ahead into 2019 we will work closer with our sponsor groups to establish more of a presence in their employee/member financial lives. With our first Board member coming from the ranks of our VA Hospital, we expect his input to add value to the offerings to that community. As to the community of Dutch Kills, we have supported them in getting their message out monthly and aided them in their efforts to keep residents informed on the Amazon issue. Having added the Big Six Towers in Woodside to our field of membership, we hope to bring more financial choices to over one thousand residents.

On behalf of a dedicated staff and volunteers serving on the Board and various Committees, I thank our members for their continued commitment to Greater Metro.  As we approach our Credit Union’s Golden Anniversary in 2020, we are planning to make it a year filled with special offers and campaigns to celebrate 50 years of service to our member-owned community.

 

Peter Nalaskowski
President & CEO

TOP