2017 Annual Report Fairly Present the Financial Condition of GECU for the Year Ending December 31, 2017

I N G M F U O L C L

C I R

L O

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Federally insured by NCUA.

YOU KEEP OUR STORY MOVING FORWARD.

OUR STORY BEGAN IT’S THE STORY OF EVERYDAY PEOPLE 85 YEARS AGO. WORKING TOGETHER TO BUILD A STRONGER COMMUNITY. PEOPLE SUPPORTING COMMUNITY TABLE OF CONTENTS

3 Board of Directors and Management Team 5 Chairman’s Message 7 President & CEO Report 9 Year-end 2017 13 Audit Committee Report 14 Statements of Financial Condition 15 Statements of Income 17 Community Impact Statements 19 Services 21 Locations BOARD OF DIRECTORS

Armando Guadalupe Grace Javier Gregory J. John Teresa Michelle Ricardo Jose Jimarez Giner Vaughn Rangel Watters Runkles Quezada Padilla Soto Quiñonez SECRETARY/ CHAIRMAN VICE-CHAIRMAN TREASURER BOARD OF DIRECTORS

EXPIRATION OF TERMS EXPIRATION OF TERMS Gregory J. Watters April 2018 Grace Vaughn April 2020 Chairman of the Board Teresa Quezada April 2019 Ricardo Soto April 2020 Jose Quiñonez April 2018 John Runkles April 2020 Vice-Chairman Advisory Directors Guadalupe Giner April 2019 Armando Jimarez September 2018 Secretary/Treasurer Javier Rangel September 2018 Michelle Padilla September 2018

MANAGEMENT TEAM

Crystal Long Lettie Ramos President & CEO Vice President, Mortgage

Ceci Davila Mike Sarabia Sr. Vice President, Chief Operations Officer Vice President, Internal Audit

Hazel Kennedy David Solis Sr. Vice President, Chief Lending Officer* Sr. Vice President, Chief Financial Officer

Teresa Montoya Chris Tompkins Sr. Vice President, Chief Marketing Officer Sr. Vice President, Chief Commercial Services Officer

Fernando Ortega Joe Underwood Sr. Vice President, Chief Information Officer Vice President, Human Resources

Darlene Palmore Daniel Vasquez Sr. Vice President, Chief Compliance Officer Vice President, Career & Talent Development

*Indicates a change in position title as of December 31, 2017. PAGE 3 PEOPLE EMPOWERING COMMUNITY CHAIRMAN’S MESSAGE

This year — your credit union’s 85th year — was packed down-payment assistance on the purchase of a home, with with growth and achievement in service to you, our the El Paso Housing Finance Corporation. This is in member-owners. The GECU story is a story of hands-on addition to our financial education and homeownership service to our members and our community. seminars that also help local families qualify for down-payment assistance. Together, these two programs All of our services are built on your credit union’s strong have helped 74 local families purchase a home of their and stable financial foundation. In 2017, your credit union own, which has helped build the assets that create financial paid you $17,510,446 in interest and dividends, an stability in our community. increase of $422,826 over last year. Our deposits increased by $79,308,819, and our loan portfolio When we share these figures, think about the lives that increased by $143,184,459. Your credit union reached a have been touched. These are hardworking families that net income of $19,484,721, increasing GECU’s net worth now have a home of their own where they used to rent, a to 9.60%. Take pride in knowing that your credit union is nest egg where they used to live paycheck to paycheck, strong and stable, and we’re using that strength — our and the ability to build wealth that spans generations. strength — to elevate our community. This is the vision of our founders, an idea brought to life through hope and hard work. None of this would be Since our 11 founders began our story 85 years ago, possible without you, our member-owners. When you place we’ve not only held on to their vision of service, we’ve your trust in GECU, we work to earn that trust each and expanded it to include more people than ever before. every day through service. Being a member of GECU is Through everything from branches and tellers to GECU more than a choice about where you keep your money, it’s Community Development and our educational outreach, adding your voice to the story of a hopeful community we are here to serve you and our community at every that’s working toward a more-prosperous future. Thank you stage of life. Every day — one member at a time — we’re for being a part of our story, and for letting us be a part of telling our story about the good we can accomplish by yours. Together, we’re doing great things, and there are working together. many more great things yet to come.

I am very proud to tell you some of the highlights of this story — a big-picture look at the results of your credit union’s tireless work to elevate our community. In 2017, our Volunteer Income Tax Assistance volunteers, along with the Coalition for Family Economic Progress and our Gregory J. Watters community partners, helped 8,026 local families receive Chairman of the Board more than $14.3 million in tax refunds and $6.3 million in Change to GECU Bylaws — 2017 Earned Income Tax Credits — free of charge. The amendments to the GECU Bylaws were approved on February 13, 2017. The GECU Bylaws were amended to allow the president to preside over annual and special meetings in the absence of the In 2017, we launched the Welcome Home El Paso chairman and indicate that other officers designated by the board of directors may preside in the absence of the president and chairman. Amendments to the Bylaws were also included to clarify that program, which provides hardworking local families with the vice-chairman shall perform duties of the chairman, unless otherwise designated in the bylaws.

PAGE 5 PEOPLEPEOPLE FOR COMMUNITYHELPING PEOPLE PRESIDENT & CEO REPORT

For 85 years, we have celebrated the values of the credit We write our story through service. When you place your union movement — the idea that everyday people working trust in GECU, we commit our efforts to helping you, your together can make a difference. Our story is a story that is family and your neighborhood thrive. Just as we work told in many voices. It is a story about hope and prosperity. together through our credit union, GECU works with our Your voice guides us as we build branches, add services community partners to make an impact. We are proud to and serve our community. Together, we are putting our support organizations that share our same values and make people helping people philosophy into action. Thank you a difference across the Borderland. Together, we’re building for placing your trust in us and for supporting the credit a more-prosperous community for everyone. union movement with your voice. It’s an honor to serve you and our community, to listen to you, and to build our credit You — the member-owner — keep our story moving forward. union around your needs. Since our founding, we’ve kept our people helping people philosophy at the forefront of our mission to serve you. We’re I’m excited to tell you that in our 85th year, your credit continuing the story that our founders started 85 years ago union is strong, stable and growing. Our membership has — one person and one day at a time — in which financial grown to 370,901 members and we’ve added two GECU independence is achievable for everyone. More than ever, Neighborhood BranchSM locations, including the Piedras our movement needs your voice to speak out in favor of and Yandell location, to serve you. Your credit union has common-sense regulations that help your credit union serve reached 25,199 community members with free financial you and our community. education seminars, including more than 100 events for students in local schools. In addition to our support of the Thank you for trusting us with all your hopes and dreams. Sageland Elementary MicroSociety, our UTEP Pillar Our strength as a credit union comes from our members. Partnership, and the GECU Foundation Scholarship that Whether you are a new member or you’ve made GECU a helps local students attend UTEP and EPCC, we’ve started family tradition that spans generations, thank you for letting serving local students and faculties directly in their own us be a part of your journey. You’re the reason why we’re schools. Starting with the successful in-school location at celebrating this milestone anniversary. The GECU story is Del Valle High School, we have also opened other locations your story because this is your credit union. Together, we’re in Coronado and Pebble Hills high schools, and a location building a brighter future for our community. in the EPCC Valle Verde campus. All of the in-school branches provide job training and real-world experience to the students that they employ. These locations are also hubs of financial education for both students and faculty, where previously there was a need for personalized financial advice. Your credit union is growing because it is a full-circle institution, reaching out with education and Crystal Long service to meet your needs at every stage of life. GECU President & CEO

PAGE 7 PEOPLE FOR COMMUNITY

PEOPLE BELIEVING IN EACH OTHER YEAR-END 2017

LOANS FUNDED 14% 16% Indirect Auto Loans $457,962,956 117%9% Direct Auto Loans $166,268,588 Credit Cards — Advances $233,810,387 38% 2017 Installment $134,320,888 11% Lines of Credit $11,780,907 Real Estate Loans (First & Second Lien) $141,969,176 39% 16% Home Equity Real Estate Loans $49,933,617 12% 1% Member Business Loans $15,844,223 4% TOTAL LOANS FUNDED: $1,211,890,742 11% 1%

RETURN TO MEMBERS 53.6%

Interest — CD $9,388,987

Interest — IRA $3,994,791

Interest — MMA $2,201,456 22.8%

Dividends — Shares $1,633,205 12.6% 9.3% Interest — Checking $292,007 1.7%

TOTAL RETURN TO MEMBERS: $17,510,446

PAGE 9 PEOPLEPEOPLE FOR INSPIRINGCHANGE COMMUNITY YEAR-END 2017 (CONT.)

12% TOTAL LOAN PORTFOLIO

11% Vehicle Loans $1,408,908,061 Credit Card Loans $282,871,015 60% 2017 Home Equity Loans $261,338,865 9% Real Estate Loans (First & Second Lien) $217,541,888

Unsecured Loans $138,582,883 6% Commercial Loans $30,090,254 Fully Secured Loans $23,505,511

TOTAL LOAN PORTFOLIO: $2,362,838,477 1% 1%

DISTRIBUTION OF EARNINGS 53.1%

Operating Expenses $95,528,370

Employee Compensation & Benefits $46,928,234 26.2%

Reserves $19,484,721 10.9% 9.8% Return to Members $17,510,446

TOTAL DISTRIBUTION OF EARNINGS: $179,451,771

PAGE 11 PEOPLE WORKING FOR YOU AUDIT COMMITTEE REPORT

Abraham Valenzuela Armando Jimarez Guadalupe Giner Ricardo Soto The Audit Committee is responsible for ensuring the CHAIRMAN appropriate oversight of GECU’s required financial-reporting objectives and for ensuring that established practices and procedures are sufficient to safeguard members’ assets in accordance with the law.

The Audit Committee is assisted by GECU’s Internal Audit Department, which conducts comprehensive internal audits throughout the year, ensuring that 1) accounting records and reports are prepared promptly and accurately reflect operations and results; 2) established internal controls are effectively maintained and adequately protect the credit union, its assets, members, management and employees; and 3) each area of the credit union is carrying out the plans, policies and procedures for which it is responsible as directed by the Board of Directors.

The Audit Committee also oversees the annual comprehensive audit conducted by the independent certified public accounting firm of Doeren Mayhew. Their examination was conducted in accordance with generally accepted auditing standards as issued by the American Institute of Certified Public Accountants.

As a result of the internal and independent audits, the Audit Committee believes the financial statements included in the 2017 Annual Report fairly present the financial condition of GECU for the year ending December 31, 2017.

We appreciate GECU’s Board of Directors, management and staff for their cooperation.

Ricardo Soto — Chairman Guadalupe Giner Armando Jimarez Abraham Valenzuela

A full copy of GECU’s 2017 financial statements may be obtained by contacting the office of Crystal Long, GECU President and CEO. PAGE 13 STATEMENTS OF FINANCIAL CONDITION DECEMBER 31, 2017 & 2016

ASSETS 2017 2016

Cash and cash equivalents $ 87,938,561 $ 61,142,545

Investment Securities: Held-to-maturity 3,000,000 3,000,000 Available-for-sale 70,216,760 81,628,914 FHLB stock 7,319,000 4,435,400 Loans held-for-sale 10,399,074 5,419,574 Loans to members, net of allowance for loan losses 2,337,212,568 2,194,028,109 Accrued interest receivable 7,104,826 6,755,048 Property and equipment 63,851,226 61,571,299 NCUSIF deposit 20,501,624 18,929,916 Life insurance contracts 28,559,654 27,365,547 Other assets 14,754,715 12,714,390

Total assets $ 2,650,858,008 $ 2,476,990,742

LIABILITIES AND MEMBERS’ EQUITY

Liabilities: Members’ shares and savings accounts $ 2,219,110,041 $ 2,139,801,222 Borrowed funds 154,193,454 85,676,605 Accrued expenses and other liabilities 23,223,972 17,195,690

Total liabilities $ 2,396,527,467 $ 2,242,673,517

COMMITMENTS AND CONTINGENT LIABILITIES

Members’ equity: Regular reserves 16,834,261 16,834,261 Undivided earnings 237,575,450 218,131,115 Accumulated other comprehensive income (loss) (79,170) (648,151)

Total members’ equity $ 254,330,541 $ 234,317,225

Total liabilities and members’ equity $ 2,650,858,008 $ 2,476,990,742

Federally insured by NCUA. PAGE 14 STATEMENTS OF INCOME DECEMBER 31, 2017 & 2016

2017 2016

Interest income: Loans receivable $ 121,668,798 $ 108,645,334 Investment securities 2,757,633 1,902,484

Total interest income 124,426,431 110,547,818

Interest expense: Members’ shares and savings accounts 17,510,446 17,087,620 Interest on borrowed funds 1,480,859 359,681

Total interest expense 18,991,305 17,447,301

Net interest income 105,435,126 93,100,517

Provision for loan losses 29,432,237 24,352,031

Net interest income after provision for loan losses 76,002,889 68,748,486

Non-interest income: Gains on sale of loans 3,453,842 4,508,977 Other income 1,596,288 1,326,808 Fees and charges and other operating income 49,975,210 44,773,288

Total non-interest income 55,025,340 50,609,073

Non-interest expenses: Compensation and benefits 46,928,234 45,751,692 Occupancy 7,460,701 6,989,617 Office operations 46,790,734 41,820,778 Other operating expenses 10,363,839 7,240,981

Total non-interest expenses 111,543,508 101,803,068

Net income $ 19,484,721 $ 17,554,491

PAGE 15 PEOPLE TRANSFORMING LIVES COMMUNITY IMPACT STATEMENTS2017 370,901 members strong AS OF DECEMBER 31, 201 7.

Financial Education and Homeownership FINANCIAL EDUCATION 708 One-on-one Counseling 1,481 Financial Education SEMINAR 4,579 Community Presentations ATTENDANCE TOTAL ATTENDEES 18,431

25,199 VITA Tax Assistance in Earned Income 8,026 $6.3 million Tax Credits received. FREE Tax returns filed. $14.3 million in tax refunds. OF CHARGE

Employee Jean Day DOWN-PAYMENT GECU Contributions ASSISTANCE

families $22,368 DONATED received 74 more than $450,000 TO LOCAL NON-PROFITS. in down-payment assistance to purchase a home of their own.

PAGE 17 PEOPLE ADVOCATING FOR OTHERS SERVICES

SHARE & DEPOSITS Share (savings) Accounts Direct Deposits Christmas Club Accounts Domestic Wire Transfers No Excuse Savers Club Accounts GECU Mascot Dru Blue Certificates of Deposit Electronic Receipts Bump-up Certificates of Deposit GECU Call Center Money Market Accounts GECU Loan Center Personal Checking Accounts GECU Online Banking — gecu.com Business Checking Accounts Bill Pay Individual Retirement Accounts (IRAs) Account balances and transfers No Excuse IRA Certificates of Deposit Online loan applications Second Chance Checking Self-service pay channels Youth Accounts FinanceWorks™ eStatements LOANS eSignature service Personal Loans GECU Mobile Banking New and Used Auto Loans Account balances and transfers Home Mortgage Loans Bill Pay Home Equity Loans Real-time mobile deposits Home Improvement Loans Mobile loan applications GECU Empowerment Mastercard® Credit Card Mobile wallet* GECU Rewards Mastercard® Credit Card ATM locator Lines of Credit Mobile registration GECU Fast Cash™ Mobile touch ID Business Loans Text messaging and account alerts GECU Knowledge Base, Email and GECU Chat SPECIAL SERVICES Night and Lobby Depositories ATMs and Real-time Deposit-taking ATMs Online Education Videos Drive-up Personal Tellers Overdraft Privilege Automatic Transfers (between GECU accounts) Safe Deposit Boxes Business Cash-management System SmartLine (24-hour account information) Chip-enabled Credit and Debit Cards* TalkBox Community Boardrooms Welcome Home El Paso Down Payment Assistance*

Federally insured by NCUA. *Services added in 2017. PAGE 19 PEOPLE CULTIVATING KNOWLEDGE LOCATIONS*

Airway & Edgemere Mesa & Mesa Hills Yarbrough & North Loop 1245 Airway Boulevard 5710 North Mesa Street 429 Yarbrough Drive (Drive-thru facility) Montwood & Desert Sun MAILING ADDRESS Alameda & Ysleta 12400 Montwood Drive PO Box 20998 8936 Alameda Avenue El Paso, Texas 79998-0998 North Loop & Horizon Artcraft & Upper Valley 10860 North Loop Drive TELEPHONE NUMBERS 6101 Upper Valley Road All Offices Operations Center 778.9221 Campbell & Mills 1225 Airway Boulevard 1.800.772.4328 218 North Campbell Street, Suite 100 Oregon & University SmartLine Eastlake & Darrington 2208 North Oregon Street 778.0009 13750 Eastlake Boulevard 1.800.772.0009 Piedras & Yandell TDD: 774.6080 Edgemere & Rich Beem 716 North Piedras Street 12801 Edgemere Boulevard, Building A GECU Call Center and Loan Center Rojas & Zaragoza 778.9221 El Paso Community College 11987 Rojas Drive 1.800.772.4328 Valle Verde Campus 919 Hunter Drive Sean Haggerty & Marcus Uribe WEB ADDRESS 11400 Sean Haggerty Drive, gecu.com GECU Community Development Building D, Suite 401 6801 Viscount Boulevard, Suite A *Services and locations as of December 31, 2017. For an up-to-date listing of locations, please visit gecu.com. Transmountain & Dyer **Securities sold, advisory services offered through CUNA Brokerage GECU Investment Services and 5625 Transmountain Road Services, Inc. (CBSI), member FINRA/SIPC, a registered broker/dealer and investment advisor. CBSI is under contract with MEMBERS Trust** the financial institution to make securities available to members. Not NCUA/NCUSIF/FDIC insured, May Lose Value, No Financial 7227 Viscount Boulevard Trawood & George Dieter Institution Guarantee. Not a deposit of any financial institution. 3037 Trawood Drive CBSI is a registered broker/dealer in all 50 states of the United States of America. Helen of Troy & Resler (Drive-thru facility) Nondeposit investment products available through MEMBERS Trust 7410 Helen of Troy Drive Company are not deposits of, or guaranteed by, the trust company, Viscount & Airway a credit union or credit union affiliate; are not federally insured or guaranteed by the NCUA, FDIC or any other governmental agency; Lee Trevino & Vista Del Sol 7227 Viscount Boulevard and are subject to investment risks, including possible loss of the 1545 North Lee Trevino Drive principal amount invested. MEMBERS Trust Company is a federal thrift regulated by the Office of the Comptroller of the Currency. Vista Del Sol & Yarbrough For legal advice, please consult your attorney and/or accountant. Mesa & Doniphan 10425 Vista Del Sol Drive 7955 North Mesa Street, Suite B

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