2013 ANNUAL REPORT

1 Federally insured by NCUA Corporate Information

CORPORATE PROFILE CORPORATE HEADQUARTERS VacationLand Federal Credit Union (VLFCU) was founded in 1956 VacationLand Federal Credit Union by employees of the Sandusky, General Motors Plant. In 2409 East Perkins Avenue 2001, VLFCU expanded its fi eld of membership to include anyone Sandusky, Ohio 44870 who lives, works, worships, attends school or has a business or Telephone: 419.625.9025 organization in Erie County, Ohio. Toll Free 800.691.9299

In 2010, VacationLand Federal Credit Union extended its membership ANNUAL MEETING into Huron County, Ohio by merging with School Employees Federal The Annual Meeting of the Credit Union’s owners will be held at Credit Union (SEFCU) to include employees of the Boards of Education 6:00 P.M. on Thursday, March 13, 2014 at UAW Local 913 Hall, who work in Huron County and employees of the Board of Education 3114 Hayes Avenue, Sandusky, Ohio 44870. of EHOVE Joint Vocational School in Erie County. Today, VacationLand Federal Credit Union is a member-owned, INDEPENDENT AUDITORS not-for-profi t cooperative committed to being the lifetime fi nancial CBS Certifi ed Public Accountants, LLC institution of its members, by providing services at lower or no 34305 Solon Road, Suite 10 fees, loans with lower rates plus deposit products with higher Solon, Ohio 44139 dividend rates. PRIVACY POLICY The Credit Union offers its members a full suite of personal fi nancial The Privacy Policy of VacationLand Federal Credit Union describes products including mortgage, home equity, consumer, student how we safeguard our members’ fi nancial privacy. Your fi nancial and credit card loans and a wide array of checking, money-market privacy is our priority. For more information, visit us at www.vlfcu. and deposit products. Business loan products include: equipment, org or call 419.625.9025. auto, truck, lines of credit and real estate loans. CONTENTS With $155 million in assets, VacationLand Federal Credit Union, Corporate In formation ...... 2 headquartered in Sandusky, Ohio serves over 16,400 members, Who We Are ...... 3 businesses and organizations at four branch offi ces and nine Chairman’s M essage ...... 4 ATMs in the cities of Sandusky, Norwalk and Vermilion plus at over Chief Executive Offi cer’s Message ...... 4 5,000 CO-OP Shared branches and 2,000 self-service locations Board Treasurer’s Message ...... 5 in the United States. Through 24-hour online banking, we serve The Governing Bodies of Our Credit Union ...... 6 members wherever they are. We Are Here to Serve You ...... 7 VacationLand Federal Credit Union is a member of Corporate Financial Hi ghlights ...... 8 One Federal Credit Union and the Federal Home Loan Bank of Chief Financial Offi cer’s Message ...... 9 and is an Equal Housing Lender. Improving Our Communities...... 10

INSURED DEPOSITS The Credit Union’s member depository accounts are insured up to $500,000. The fi rst $250,000 of insurance is provided by NCUA’s National Credit Union Share Insurance Fund while the second $250,000 is made available through private insurance from Excess Share Insurance Company, paid for by VacationLand.

2 Who We Are

OUR VISION OUR CORE VALUES AND BELIEFS To be our members’ chosen lifetime fi nancial partner and to Resourcefulness - Finding solutions improve our communities for future generations. Excellence - Achieving the best possible outcome Strategy - Thoughtful execution OUR MISSION Passion - Heartfelt action Guided by our core values, we exist as a not-for-profi t cooperative Empowerment - Invest authority to succeed to serve and surpass by providing value and fi nancial freedom. Commitment - Dedicated service Trust - Serving with integrity

The VacationLand Federal Credit Union Difference

Many people may not know what makes VacationLand Federal Credit Union different from other fi nancial institutions. Here are just a few ways that demonstrate our uniqueness.

WE ARE MEMBER-OWNED WE ARE A COOPERATIVE As a member-owner, regardless how much you save or borrow, you Cooperatives pool resources for the common good. In like fashion, determine who serves on the Board of Directors. You have one vote depositors of VacationLand Federal Credit Union pool funds to for each open Board of Director seat. Also, as a member-owner, lend to one another. Through our structure and operation, credit annual meetings are open to you. We encourage you to attend. unions carry out the credit union philosophy of “people helping people.” At VacationLand Federal Credit Union, you’re not just an WE ARE NOT-FOR-PROFIT account number—you’re a member helping other members. We are out to protect your wallet, not fi ll our own! We return profi ts to you — the members — in the form of lower loan rates, IN SUMMARY higher dividend rates, and low or no fees for services. Put another way, VacationLand Federal Credit Union is different. We are not a bank. We’re not a payday lender. We are a low WE ARE VOLUNTEER DRIVEN cost fi nancial institution that you will want to be affi liated with Each of our Board of Directors is an unpaid member-volunteer for a lifetime. you have elected to work in your best interest. Directors serve on Asset/Liability management, Policy, Insurance, Marketing We appreciate the opportunity to serve you, and we value your and Facilities committees, assisting management in making membership. If you have experienced the VacationLand Federal decisions on how to improve member products, service and Credit Union Difference, please encourage your family and friends operational effi ciencies. to discover the benefi ts of membership.

We appreciate the opportunity to serve you, and we value your membership. If you have experienced the VacationLand Federal Credit Union Difference, please encourage your family and friends to discover the benefi ts of membership.

3 A Message from Our Chairman of the Board of Directors

2013 was an incredible year for VacationLand FCU. needs will continue to be a top priority. We also hope to put more Financially we had one of our very best years ever. focus on how to best serve our diverse membership demographic, Our Net Income increased by nearly 33%, while realizing that all of us have different needs and wants from our Assets grew by over 5% to $155 Million, and key fi nancial institution. Providing safe and secure fi nancial services on ratios exceeded national peers in most categories. different platforms we know is an important service. Furthermore, we will attempt to relate more to our younger members via social media We entered into a new three year collective while at the same time remain accessible to our senior members who bargaining agreement with the UAW Local 913 may not feel comfortable using the latest and greatest technology. last November and broke ground on what will be a brand new Hayes Avenue facility, which will be ready for occupancy mid-year. In order to better understand what is important to you, we need your feedback on how to best serve you, our member. Please plan to The challenge for the Board of Directors in 2014 and beyond will be to attend our Annual Meeting on Thursday, March 13, at 6:00 pm at work with management in developing a strategy on how best to use the UAW hall, just south of our Hayes Avenue offi ce. This will be a our Capital and serve our membership. One initiative that will improve perfect opportunity for us to meet you and get your thoughts on issues member service will occur when the new Hayes Avenue branch opens important to our membership. for business this coming summer. The Board is excited about this venture. We hope you will fi nd that the new facility and the upgrades In closing, we wish all our members the best for 2014! And please made at our Perkins Avenue, Vermilion and Norwalk branches will remember, we are here to serve you! offer you signifi cant improvements in our fi nancial delivery systems. Sincerely yours, The Board, however, realizes that it will take more than just a new Jude T. Hammond building, a fresh coat of paint and improvements to our existing Chairman of the Board of Directors buildings to meet our members’ needs. Ensuring that we offer competitive interest rates and fi nancial products that will meet your

A Message from Our Chief Executive Offi cer

As a valued member of VacationLand Federal with a modern, environmentally green facility that reduces our carbon Credit Union, you are not just a customer building footprint. Also important, it will give the credit union fi ve to ten years profi ts for stockholders; you are one of over 16,400 of growth capacity. Other accomplishments in 2013 included the owners in a not-for-profi t cooperative which pools implementation of a fi ve-year IT replacement plan and successfully its resources for the benefi t of all members. keeping abreast with compliance in an ever-changing NCUA regulations environment. In general, we concentrated on improving Consequently, each and every member-owner, processes and preparing the foundation of the credit union for future whether a founding member going back to 1956 stable growth. or one that joined yesterday, is highly important to the success of our credit union. We truly appreciate everyone’s So… what will 2014 bring? We expect to fi nalize construction on the involvement and hope that you, and all members, will continue to have Hayes facility in June or July and, once settled in, we’ll celebrate with a confi dence in our staff and services as we move forward in 2014. member grand opening in late summer. One of the challenges we face this year is to develop products and services that will benefi t our very As a fellow owner, I am very pleased to report that 2013 was a banner diverse membership. In response, creating competitive interest rates year for VacationLand. Our year-end fi nancial statements show a and additional fi nancial products of benefi t to all members will remain a manageable 5.42% asset growth and a very strong and healthy 1.00% top priority. And, we will continue to pursue younger members through return on assets. Our capital ratio continues to get stronger year over active social media outlets plus develop a functional website and mobile year ending 2013 at 10.38%, still well above the “well capitalized” fl oor applications for those on the go. Our goal for 2014 is to defi nitely make limit set by the NCUA. For last year, management spent a considerable the credit union easily accessible to all its member-owners. amount of time on the annual budgeting process, and as a result, we remain at the upper end of our credit union peer group in all fi nancial The volunteer directors and supervisory committee members, staff and categories. Our most important asset, our member-owners, grew by management of VLFCU remain dedicated to the credit union’s core 2.64% as we welcomed 422 new members to the credit union in 2013. values, and collectively we are committed to providing you, our owner- I hope that our new members are fi nding the experience as valuable members, with the best fi nancial services to meet your specifi c needs. as those that have been with us for many years. Please stop in and visit us at any of our locations. We look forward to meeting and serving you in 2014. Our 2013 project list was aggressive to say the least; however, we were able to accomplish many items that make the credit union better Thank you, and more effi cient for all members. Topping the list was the start of Bryan P. Myers construction of our new Hayes branch and administration facility. Chief Executive Offi cer This project replaces our existing, outdated and ineffi cient building 4 A Message from Our Treasurer of the Board of Directors

2013 EARNINGS AND MEMBERSHIP GROWTH Efficiency Ratio 2009-2013 Thanks to the loyalty of our long-term members and the infl ux of 77.00% new members, I am pleased to report another strong year for VacationLand Federal Credit Union with 2013 Net Income rising 76.00% by $375,668 from one year ago to $1,519,066. The effi ciency 75.00% ratio, which is the measure of cost to generate revenue, increased 74.58% modestly 57 basis points to 71.99% in 2013. 74.00%

Our membership has grown from 16,009 in 2012 to 16,431 at 73.00% 2013 year-end, a direct result of the efforts from management and 72.51% staff to provide superior member service. We have managed the 72.00% 71.99% Credit Union with integrity, protecting its safety and soundness, 71.42% and thereby fostering the confi dence of our members and 71.00% community at large. 70.00%

69.51% DEPOSIT INSURANCE UP TO $500,000 69.00% 2009 2010 2011 2012 2013 More and more individuals, families and small local businesses are discovering the benefi ts of a not-for-profi t fi nancial cooperative and are moving their money to credit unions. By year-end 2013, Return on Average Assets our deposits grew to over $128 million. All depository accounts are 1.00% insured up to $500,000. The fi rst $250,000 of insurance is provided 1.00% by NCUA’s National Credit Union Share Insurance Fund while the 0.80% second $250,000 is made available through private insurance from 0.80% Excess Share Insurance Company, paid for by VacationLand. 0.60% 0.59% 2014 AND BEYOND

VacationLand Federal Credit Union’s decisions are made with our 0.40% members’ best interests in mind. We will continue our long history of giving back to our members in the form of better rates, low or 0.20% no fees and more affordable fi nancial services. As in the past, we will continue to do our best to deliver member-driven service 0.06% 0.00% while safeguarding your assets. Thank you for your confi dence 2009 2010 2011 2012 2013 and loyalty in our credit union. -0.12%

-0.20% The construction of our new Hayes branch facility is underway and on schedule. Photographs of the building’s construction phases are available on the credit union’s Members Facebook page www.facebook.com/VacationLandFCU 17,000 On behalf of the Board of Directors, we wish to extend our thanks 16,000 16,431 to the staff and management for meeting the fi nancial needs of 16,009 our members with such great care and commitment. 15,555 15,000 15,395 15,276 Sincerely, 14,000 Tracy Luc Treasurer of the Board of Directors 13,000

12,000

11,000

10,000 2009 2010 2011 2012 2013

5 The Governing Bodies of Our Credit Union

THE BOARD OF DIRECTORS The 2013 Board of Directors is comprised of seven volunteers, elected by you, the members, who are responsible for the governance, direction and control of the affairs of VacationLand Federal Credit Union in accordance with National Credit Union Administration rules and regulations and sound business practices. The Board of Directors dedicates its time and talent to make VacationLand Federal Credit Union a premier credit union. The Board delegates the day-to-day activities through policies to Senior Management of the credit union. Directors serve for a term of three years with an equal number of terms expiring at the end of each annual meeting. Monthly meetings are held by the Board of Directors to conduct the business of the credit union by reviewing its performance and Sitting L to R: Marcia Renande, Christine Giardina, Tracy Luc policies. Once per year the Board of Directors also meets with and Martha Thompson. Standing L to R: Jan Sadoski, Joel Senior Management for a full day session to develop the three- Hassinger and Jude Hammond. year strategic plan. Board of Directors: Term Expiration and Committee Membership Jude Hammond: Chairman - 2016, (1), (2), (4), (6) Joel Hassinger: Director - 2016, (6), (8) Jan Sadoski: Vice Chairman - 2015, (1), (7) Christine Giardina: Director - 2017, (1) Marcia Renande: Secretary - 2017, (2), (5) Martha Thompson: Director - 2015, (3) Tracy Luc: Treasurer - 2015, (1) Board of Director Committees (1) Asset/Liability Management (3) Insurance (5) Marketing (7) Policy (2) By-Laws (4) Security (6) Nominating (8) Facilities THE SUPERVISORY COMMITTEE The Supervisory Committee consists of members appointed by A representative of the Supervisory Committee attends the monthly the Board of Directors to serve one to three year terms. These Board of Directors meetings and shares their fi ndings. To date, volunteers are responsible for assuring the safety of the credit the Supervisory Committee has reported that, in their opinion, union’s assets and deposits, the soundness of management and VacationLand Federal Credit Union has operated in a fi scally safe compliance with various fi nancial and regulatory requirements. and sound manner and, in all material aspects, in accordance with applicable accounting, federal, state, and NCUA regulations. In fulfi lling these responsibilities, the Supervisory Committee recommends to the Board of Directors for ratifi cation the In March 2013 Bill Wood resigned from membership on the appointment of an independent audit fi rm to annually examine Supervisory Committee after having served the credit union for the fi nancial statements of the credit union. many years, fi rst as a multiple term director on the Board of Directors before joining the Supervisory Committee in early 2008. An audit of the 2012 fi nancial statements was conducted by CBS A VLFCU member for more than 45 years, Bill’s ardent dedication Certifi ed Public Accountants, LLC. The audit report stated that to the founding principles of the credit union will always be our fi nancial statements present fairly, in all material aspects, appreciated and remembered. VacationLand Federal Credit Union’s statements of fi nancial position, results of operations and cash fl ows. The audit report for 2013 will be The 2013 Supervisory Committee members are: William Stauder, available after March 28, 2014 and may be requested from: Theresa Barylski, Christopher Palmer, Lynn Sartor and Jacquelyn Streng. Mitchell J. Fallis, CPA, MBA Sincerely, Chief Financial Offi cer William Stauder, Chairman

419.609.2718 Capital/Asset Ratio 2009-2013 10.50%

10.30% The National Credit Union Association (NCUA) conducts an annual 10.38% examination of the records, policies, practices and the application 10.10%

9.90% of NCUA regulations upon VacationLand Federal Credit Union. 9.91%

9.70% 9.76% 9.69% Just like the Board of Directors, the Supervisory Committee also 9.50% holds monthly meetings to, among other things, review internal audit 9.30%

9.10% services, internal controls and risk management processes, and 9.20% examinations by regulatory agencies and the independent audit fi rm. 8.90%

8.70%

8.50% 2009 2010 2011 2012 2013 6 Average We Are Here to Serve You

MANAGEMENT Bryan Myers — Chief Executive Offi cer Brian Barker — Financial Manager Mitchell Fallis — Chief Financial Offi cer Evie Bonzar — Training Manager Marla Troike — Chief Operations Offi cer Derek Callin — IT Coordinator Katja Rall-Koepke — Director, Human Resources Heather Gilchrist — Marketing Coordinator Jami Andres — Senior Vice President, Consumer Lending Davida Sosa — Executive Assistant Brett Gerber — Senior Vice President, Business Lending Stephanie Helton — Assistant Vice President, Tracie Dahlke — Vice President, Branch Management & Collections Credit Analyst Peggy Day — Vice President, Branch Management & Norwalk/ Vermilion Business Development Barbara Yost — Vice President, Branch Management & Facilities STAFF Heather Baer Trisha Dauch Lisa Howerton Abbie Picciuto Kathy Slusher Kate Bogard Jen Enzor Mary Jackson Barb Pickering Terry Souter Deb Booth Megan Etzler Carol Lawrence Cayte Pisano Debra Todd Lynne Brownell Marilyn Finnen Sheri Leber Shelli Pfl ieger Wendy Warren Sarah Buttermore Mandi Fleck Amy Leroux Stephanie Prieur Amy Wasem Heather Cantu Debra Graves Shelly Luipold Jan Roberts Deb Weaver Charlie Conway-Johnson Nancy Hart Jill Mercer Julie Ruffi ng Christy Wohlever Annette Crum Ann Hermes Julie Musick Keily Ruggles Emily Zilke Sandy Cummings G. Elaine Hines Kathy Old Samantha Savage INDEPENDENT FINANCIAL ADVISOR David Karikas, of Preferred Planning Associates, offers more than (a) Non-deposit Investment Products: are not FDIC or NCUA insured, are 24 years of experience in non-deposit investment products (a), not obligations of or guaranteed by VacationLand Federal Credit Union, insurance and fi nancial advice. David’s services are available to involve investment risk and may lose value. David Karikas is a Registered VLFCU’s members. Representative offering securities through Cambridge Investment Research, Inc., a broker/dealer, Member FINRA/SIPC. Cambridge, David Karikas serves over 600 members with over $24 million VacationLand Federal Credit Union, and Preferred Planning Associates in invested assets. Additional products include Life Insurance, are not affi liated companies. Long-Term Care and Fixed Annuities. David is located at our Hayes Offi ce, 2911 South Hayes Avenue, Sandusky, Ohio or call 419.625.9025 Extension 1777.

7 VacationLand Federal Credit Union Financial Highlights (Unaudited)

Dec. 31, 2013 Dec. 31, 2012 Dec. 31, 2011 Dec. 31, 2010 Dec. 31, 2009 Assets Cash and Equivalents 3,816,239 6,215,658 7,302,811 14,151,624 15,650,073 Investments 51,742,073 45,733,623 38,698,945 41,906,168 37,441,464 Loans 97,027,553 94,013,481 91,510,205 80,501,240 77,367,618 (Less) Allowance for Loan Loss (1,212,920) (1,047,636) (1,056,579) (954,031) (710,020) Land, Building and Equipment 1,145,479 1,315,274 892,742 585,675 612,550 Other Assets 3,201,360 1,489,036 1,905,695 1,593,512 1,217,792 Total Assets 155,719,784 147,719,436 139,253,819 137,784,188 131,579,478

Liabilities Other Liabilities 1,154,735 1,010,564 1,658,871 399,254 1,008,323 Notes ayable P 9,601,758 5,866,737 ------Total Liabilities 10,756,493 6,877,301 1,658,871 399,254 1,008,323

Share Drafts 17,444,129 15,600,683 15,212,637 13,866,738 13,036,245 Shares 84,872,034 80,619,755 73,895,928 68,441,973 60,762,064 Certificates 26,523,421 29,979,236 34,987,320 42,395,646 43,930,353 Total Shares 128,839,584 126,199,674 124,095,885 124,704,358 117,728,662

Owners Equity (Capital) Regular Reserves 2,870,959 2,870,959 2,870,959 2,870,959 2,836,515 Accum. Unrealized Gain/Loss - AFS (37,820) ------Undivided Earnings 13,290,568 11,771,502 10,628,104 9,809,617 10,005,978 Total Equity 16,123,707 14,642,461 13,499,063 12,680,576 12,842,493 Total Liabilities & Owners Equity 155,719,784 147,719,436 139,253,819 137,784,188 131,579,478

Income Loan Interest 5,504,505 5,437,885 5,049,310 4,703,698 4,767,268 Investment Interest 1,054,875 916,077 1,052,562 982,856 1,052,806 Other Income 2,925,703 2,799,596 2,814,610 2,636,814 2,330,041 Total Income 9,485,083 9,153,558 8,916,482 8,323,368 8,150,115

Expenses Staffing 3,597,057 3,366,253 3,444,217 3,014,947 2,860,290 Dividends 562,537 784,440 1,110,888 1,647,036 1,811,712 Interest Expense - Borrowings 95,840 17,092 ------Allowance for Loan Losses 479,000 693,947 329,415 799,639 600,634 Operating 3,127,616 3,029,625 2,905,284 2,693,154 2,644,484 NCUA Stabilization Expense 103,968 118,804 308,190 326,766 160,781 Total Expenses 7,966,018 8,010,161 8,097,994 8,481,542 8,077,901

Net Income (Loss) 1,519,066 1,143,398 818,488 (158,174) 72,214

Financial Ratios Return on Average Assets (ROAA) 1.00% 0.80% 0.59% -0.12% 0.06% Net Interest argin M 3.89% 3.89% 3.60% 3.02% 3.29% Operating Expenses to Average Assets 4.50% 4.54% 4.80% 4.48% 5.10% Efficiency Ratio 71.99% 71.42% 74.58% 72.51% 69.51% Loans to Shares 75.31% 74.50% 73.74% 64.55% 65.72% Allowance for Loan Loss to Total Loans 1.25% 1.11% 1.15% 1.19% 0.92% Net Charge-offs to Average Loans 0.32% 0.82% 0.20% 0.72% 0.76% Delinquent Loans to Total Loans 1.02% 0.96% 1.47% 1.70% 1.75% Capital to Assets 10.38% 9.91% 9.69% 9.20% 9.76%

Distribution of Income Operating Expenses 6,828,641 6,514,682 6,657,691 6,034,867 5,665,555 Dividends 562,537 784,440 1,110,888 1,647,036 1,811,712 Capital 1,998,066 1,837,345 1,147,903 641,466 672,848

Number of Members 16,431 16,009 15,555 15,395 15,276 Number f mployees o E 61 59 55 53 48

8 A Message from Our Chief Financial Offi cer

VacationLand Federal Credit Union stayed Union’s Equity position eclipsed the $16 million mark climbing to true to its mission to serve and surpass by $16,123,707 at year-end. providing value and fi nancial freedom to its members through improved products The Capital to Asset Ratio is another key indicator of the and services, while focusing efforts to save fi nancial strength of a credit union. The capital to asset ratio members money and increase wealth. climbed from 9.91% from one year ago to 10.38% at December 31, 2013, well above the 7.00% ratio required to be categorized As a result, VacationLand Federal Credit as “Well Capitalized” under National Credit Union Administration Union, the 10th largest Credit Union in regulations for prompt corrective action. , continued its strong fi nancial growth to over $155 million in assets. Two other key measures of fi nancial In 2013, VLFCU received a favorable report by the strength emerged in 2013, Capital and Earnings. National Credit Union Administration, our federal regulatory agency, substantiating our sound fi nancial management. 2013 IN REVIEW Net Income surpassed the $1 million mark for the second 2014 A LOOK AHEAD consecutive year reaching $1,519,066 in 2013, an increase of We forecasted an interest rate environment for 2014 with 32.8% compared to Net Income of $1,143,398 in 2012. increases on the yield curve (50–100 basis points) in years 2 to 10 and lower increases of (0–30 basis points) in year 1 as well Return on Average Asset (ROAA) is a key measure of a credit as years 11-30. VLFCU’s fi nancial mix of earning assets, member union’s fi nancial health. The 2013 ROAA rose from .80% to 1.00%, deposits, borrowed funds and capital coupled with our fi nancial up 20 basis points from last year while our peer group ROAA was plan positions us for continued success in 2014 and beyond. .56%. Net Interest Margin remained solid at 3.89%, equal to its 2012 ratio. Net Interest Margin for 2013 was driven by a For 2014 we refi ned our fi nancial plan to increase loan volume 3.2% increase in interest income coupled with a 17.9% decline in supported by funding from member deposits, wholesale funds interest expense from lower market rates. and capital growth. The plan calls for minimizing our long-term interest rate risk by funding fi xed long-term mortgages and Revenues for 2013 totaled $9,485,083, up from $9,121,878 in member business loans with fi xed long-term borrowings from the 2012. Contributing factors included increases in loan income of Federal Home Loan Bank of Cincinnati, member deposits and a 1.2%, investment income of 15.2%, fees and charges of 4.0% and new funding source, brokered certifi cate of deposits. miscellaneous income of 21.1%. Additionally, our plan is supported with a solid marketing strategy Total Assets rose by $8,000,348 or 5.4%, reaching $155,719,784 and a new call center program coupled with education and at December 31, 2013. Asset growth was funded by growth in training for our employees. We will continue to focus on building retail deposits of $2,639,910, FHLB borrowings of $3,735,021 relationships with existing and new members to assist them in and equity of $1,519,066. meeting their fi nancial goals. Total Loans grew by $3,014,072 from increases in consumer We thank our employees, Board and Supervisory Committee for direct, indirect and Visa loans which were offset in part by their dedication. We thank you, our members, for your continued decreases in mortgages and member business loans. support and look forward to a prosperous 2014. Investments rose by $6,008,450 reaching $51,742,073 at Best regards, year end. Investment Income for 2013 rose 15.2%, climbing Mitchell J. Fallis, CPA, MBA $138,798, to $1,054,875, driven by an investment strategy of Chief Financial Offi cer reinvesting maturing securities into higher yielding longer-term municipal and agency securities. Non-interest Income grew in 2013 from increased mortgage loan origination fees and a refund on credit life and disability insurance premiums. Total Expenses decreased by $12,463 in 2013 to $7,966,017, supported by decreases in dividends of $221,903, marketing expenses of $61,735, and provision for loan losses of $214,947 from improvements in loan quality. These decreases were offset in part by increases in employee compensation of $168,506, employee benefi ts of $62,298 and professional and outside services of $114,747. Member Deposits increased by $2,639,910 during 2013, ending the year at $128,839,584. VacationLand Federal Credit

9 Improving Our Communities

MEMBERS DO THE MARKETING As anyone at VLFCU will tell you, it’s our members who best a variety of products offered by VLFCU including auto loans, promote us! In 2013 members were featured in two of our mortgages, unsecured loans, Visa credit cards, and business three major marketing campaigns. We started off the summer loans. We also included a Norwalk Elementary teacher to help us highlighting three general ideas on how the credit union and reach out to Huron County School Employees. members have helped each other. A young family was thankful for securing a mortgage for their fi rst home; Green Door Media We had fun including members in these two campaigns and were emphasized how local cooperation benefi ts everyone; and a excited to hear their positive experiences with VLFCU. We are here mother/daughter duo showcased the fact that VLFCU provides to serve you, our members and will continue to strive to exceed loans to every generation. your expectations. In early winter of 2013, we continued to rely on member and Thank you to the following members who volunteered to star as employee participation as we launched our “Missing Piece” our ambassadors in 2013: campaign. Members were paired up with employees to represent SUMMER CAMPAIGN • Susan Aaron-Brown and Shaconda Aaron • Chad Gerold, Kasandra Garcia, and Gracie Garcia • Ryan Whaley and Nikki Lloyd MISSING PIECE CAMPAIGN • Amber Adkins and Ember Andres • Nicholas and Linda Esposito • Juan Martinez • Josh Schlotterer • Anthony and Brandis Stout • William Via

A DIFFERENT KIND OF DRIVE The VLFCU cuBe truck continued to grow in popularity in 2013 before the fi rst snowfall, the truck took shelter in the Sandusky and was featured at the Great Lakes Home & Garden Show, Girls’ Mall and became the drop off location for Coats for Caring and Night Out, and at several summer events including Party at the the VLFCU Toy Drive. Plaza and Cruisin’ By the Bay. The cuBe also entertained kids at several charitable events and participated in homecoming parades According to Marketing Coordinator, Heather Gilchrist, “The cuBe for Perkins High School and Sandusky Central Catholic School. At truck is a unique marketing tool that allows VLFCU to enjoy a Halloween, the cuBe was transformed into a spooky display as community presence while at the same time it satisfi es a variety of VLFCU staff and management volunteered to hand out candy at needs. It defi nitely gets noticed wherever we go!” two Halloween events hosted by and Ability Works. But, the cuBe truck is not just used for marketing and amusement. Due to its capacity, it also served well as a collection center. For Stuff the Bus, it was used to collect backpacks and school supplies from over 20 businesses around Erie County. It continued to serve as a “bus” during the Stuff the Bus wrap up event in August. And,

WONDER WHAT cuBe REPRESENTS? credit union Big experience

The cuBe truck is a unique marketing tool that allows VLFCU to enjoy a community presence while at the same time it satisfi es a variety of needs. It defi nitely gets noticed wherever we go!

10 Improving Our Communities

YOUR CREDIT UNION PROVIDING FOR YOUR COMMUNITY VLFCU strives to give back to our community throughout the Throughout the year, VacationLand also gave back to the year to organizations and charities that assist residents in our members. In April, we participated in Credit Union Youth Week, fi eld of membership. In 2013 cash donations and raffl e prizes during which, we sponsored a coloring contest and other fun were donated to nearly 40 causes. Some of the more notable activities for some of our youngest members. A month later, we contributions were made to Back to the Wild, Foundation for granted scholarships to six of our student members graduating , Stein Hospice, Teen Leadership, Girls’ Night Out, United from Sandusky Central Catholic, Perkins High School, Sandusky Way of Erie County, and Relay for Life. High School, Huron High School, and Margaretta High School. In October, members were treated to food, refreshments, and prizes Besides fi nancial support, VLFCU assisted with other community as we celebrated International Credit Union Day. efforts in 2013. We sponsored our third annual Easter Egg Hunt partnering with Osborn Metro Park to provide more room and In 2014 we pledge to continue our community outreach and activities for the kids. This event continues to grow in popularity, encourage member involvement. As your credit union, VLFCU and we look forward to more fun in 2014. Last summer, we again aspires to make you proud. Your input and participation is vital collaborated with the United Way of Erie County, The Volunteer to our success! Center, The Sandusky Mall, and Ohio Business College to sponsor Stuff the Bus. As a result of our efforts, we were able to provide 404 To contact the Marketing Committee backpacks fi lled with school supplies to children in kindergarten VacationLand Federal Credit Union through sixth grade, attending Sandusky, Perkins and Sandusky P.O. Box 2257 • Sandusky, OH 44871 Central Catholic Schools. During the holidays, VLFCU renewed Attention: Heather Gilchrist its commitment to helping those in need by sponsoring the BAS Email: [email protected] Coats for Caring drive and a toy drive to help families served by the Sandusky Salvation Army and the Erie County Department of In 2014 we pledge to continue our community Jobs and Family Services. outreach and encourage member involvement. As your Both events were quite successful, and we thank the VLFCU credit union, VLFCU aspires to make you proud. Your membership and employees for their generous contributions! input and participation is vital to our success!

11 SANDUSKY ATM LOCATIONS 2911 S. Hayes Ave. All four of our branches are equipped with ATMs to provide Sandusky, OH 44870 24-hour access to cash funds. Additionally, members can T: 419.625.9025 access their accounts at the following business locations. T: 800.691.9299 Kyklos Bearing International (KBI) Lobby Hours 2509 South Hayes Avenue Monday – Friday: 9:00 am - 5:00 pm Sandusky, OH 44870 Saturday: Closed Plant Cafeteria Drive Through Hours Monday – Friday: 9:00 am - 5:00 pm Firelands Hospital — North Campus Saturday: Closed 1111 Hayes Avenue Sandusky, OH 44870 SANDUSKY 2nd Floor — Vending Machine Area 2409 E. Perkins Ave. Firelands Hospital — South Campus Sandusky, OH 44870 1912 Hayes Avenue T: 419.625.9025 Sandusky, OH 44870 T: 800.691.9299 Lower Level — Near Elevators. Lobby Hours Monday – Friday: 9:00 am - 5:00 pm International Automotive Components (IAC) Saturday: 8:30 am - 12:00 pm 1608 Sawmill Parkway Huron, OH 44839 Drive Through Hours Outside Plant Cafeteria Monday – Thursday: 9:00 am - 5:00 pm Friday: 9:00 am - 6:00 pm Vermilion — Main Street Soda Grill Saturday: 8:30 am - 12:00 pm 5502 Liberty Avenue Vermilion , OH 44089 VERMILION Walk-Up ATM — East Side of Building 1607 State Route 60, Ste. 11 Vermilion, OH 44089 CONNECT WITH US T: 440.967.5155 CU*Talk: 419.621.8328 or 877.256.3336 T: 800.691.9299 Website: www.vlfcu.org Lobby Hours f Facebook: www.facebook.com/VacationLandFCU Monday – Friday: 9:00 am - 5:00 pm t Twitter: www.twitter.com/VacationLandFCU Saturday: 8:30 am - 12:00 pm y Youtube: www.youtube.com/VacationLandFCU Drive Through Hours Monday – Friday: 9:00 am - 5:00 pm Saturday: 8:30 am - 12:00 pm

NORWALK 295 Milan Ave., Ste. C Norwalk, OH 44857 T: 800.691.9299 Lobby Hours Monday – Friday: 9:00 am - 5:00 pm Saturday: Closed Drive Through Hours Monday – Friday: 9:00 am - 5:00 pm Saturday: 8:30 am - 12:00 pm

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