BUILDING BETTER BANKING ANNUAL REPORT 2017 Federally insured by NCUA Core values: Collaboration, Commitment to Members, Community Focus, Continuous Improvement, Creating Trust, and Creativity and Innovation. Board of Directors and Audit Committee 1 Chairman’s Report 2-3 President’s Report 4-5 Audit Chairman’s Report and Financial Report 6-7 Community Involvement 8-12 Board of Directors Audit Committee WILLIAM PERMENTER DR. BRENDA R. SIMMONS- BRUCE DOUECK CHANTELLE QUICK Chairman HUTCHINS Chairman CPA Retired, Retired, Retired, Senior Vice President, Duval County FSCJ JEA, Controller, Public Schools Independent Management Stein Mart Educational Consultant Consultant ELVIA WILLIAMS MARSHA COARSEY JOHN JOLLY ALAN LOVETT Vice Chairman Retired, CPA Vice President, Communications Duval County Retired, Internal Audit Services, Coordinator, Public Schools Captain USNR Advanced Disposal JEA BETTIE ADAMS BRUCE DOUECK GINA EUBANKS Secretary Retired, CIA, CISA, CRMA, CCSA Retired, JEA, Governance Advisor Assistant Professor Management Eubanks Risk Consulting, of Accounting & Finance, Consultant LLC UNF SCOTT BENNETT MALINDA PRUDENCIO Treasurer Vice President, Associate Risk Control Vice President, & Chief Risk Officer, Administration The Energy Authority® & Finance, UNF Our Mission ELLEN PAIGE To provide financial solutions for every stage of life Executive Director, Budgeting & Business Operations, JU Community First Credit Union has developed a financial wellness program called moveUP. MoveUP combines technology and financial education in a way that helps individuals learn Nationally Recognized about financial concepts important to them. 1 Chairman’s Report | William Permenter, Chairman of the Board On behalf of the volunteer board of Community First Credit Union, thank you for supporting locally-based financial services. We continue to grow because of your support of our mission to provide financial solutions for every stage of life and our vision to improve members’ lives while building strong and vibrant communities. I am proud to help present our 2017 Annual Report. The board of directors is charged with ensuring your credit union is operating safely and soundly creating a solid financial foundation for the institution. We also establish policies and procedures for the leadership to implement for improved operations and service. In addition to providing outstanding financial products and services, our commitment to enhancing life on the First Coast is unparalleled. From the continuation of the Raymond A. Vinson Scholarship to the annual ZOOLights event at the Jacksonville Zoo and Gardens, Community First continues to help improve quality of life across the region. We are proud the Community First Cares Foundation continues to serve our community through charitable and nonprofit support. Community First Credit Union, a not-for-profit owned by our members, undergoes regular examinations by state and federal regulatory agencies. We also employ a third-party independent audit firm to ensure compliance. We have included an audit summary in the annual report. I think you will find that our policies and procedures have resulted in an exceptionally well-managed, financially secure institution. I am proud of our growing membership base. We would not be the organization we are today without the support of our members. That is why our leadership and staff will continue to work hard every day to give you more ways to love where you bank. Sincerely, William Permenter, Chairman of the Board 2 The Community First Cares Foundation The Community First Cares Foundation helps support transformational change in our region. We fund high impact projects that build healthy communities by improving our educational system, enhancing financial literacy, and supporting programs that improve quality of life on the First Coast. In 2017, the Community First Cares Foundation helped fund many meaningful projects and programs. THE MONIQUE BURR FOUNDATION JACKSONVILLE PUBLIC LIBRARY FOUNDATION We continued our support of the Monique Burr Foundation with a $10,000 grant to expand its The 2017 Summer Learning program, implemented throughout the Jacksonville’s 21 public important safety curriculum to all middle schoolers in our region. MBF Teen Safety Matters™ is library branches was a huge success. The goal of summer reading is to reduce the effects of a comprehensive, research-based, prevention education program that educates and empowers the “summer slide” — students losing education ground they gained the previous school year teens and all relevant adults with information and strategies to prevent, recognize, and respond while they’re on summer break. Community First Cares Foundation helped 1,466 local children appropriately to bullying, cyberbullying, all types of abuse, relationship abuse, sex trafficking, participate in Summer Learning through the donation of $7,334. Every $5 donated helped offset digital abuse, and other digital dangers. the cost for one child to attend the summer programs at neighborhood branches. THE GIVING CLOSET JACKSONVILLE ZOO AND GARDENS We helped open Jacksonville’s first and only physical closet Since 2013, donations from our Board In December 2017, Community First members participated in a housed in a Duval County public school for students who need fundraiser to support The African Forest, an expansion project at clothing, shoes, hygiene items, and other basic supplies we often of Directors, partners, employees, the Jacksonville Zoo and Gardens. We matched all public donations take for granted. and provided more than $20,000 in funding to assist with this and members have helped our very important project. With African Forest, the Jacksonville Zoo is WE CARE foundation provide more than combining the best in exhibit design, research, animal wellness, and Jacksonville’s health advocacy program provides specialty interpretation, while pushing boundaries and charting a new zoo path. medical care to low-income, uninsured, and homeless adults in $250,000 in charitable funding Upon completion of this project in 2018, this new exhibit will deliver a Duval County. We created a part-time community health worker full and comprehensive experience for the animals, guests, and staff, who advocates for patients and their care when no one else can right here on the First Coast. while producing a revolutionary, world-class habitat. or will. JACKSONVILLE PUBLIC EDUCATION FUND CULTURAL COUNCIL OF GREATER JACKSONVILLE The Jacksonville Public Education Fund created PowerUP Jax as a way In March, we supported an artist professional development workshop hosted by the Cultural to elevate and celebrate Jacksonville’s best teachers. Community First Cares Foundation is the Council of Greater Jacksonville. The workshop, titled “Entrepreneur Symposium for Creatives: lead contributor of PowerUP Jax, launched in October 2013. Since its inception, the Foundation Every Artist is a Small Business,” was held at the Jesse Ball duPont Center in downtown funded more than 100 innovative classroom projects in several subjects, including STEM, English/ Jacksonville. In addition to sponsoring the event, we supported Jacksonville’s creative community Language Arts, Math, Music, Civic Responsibility, and more, to make an impact in the lives of by offering five (5) individual artist grants in the amount of $1,000 each. local students. Community First Cares has funded more than $30,000 for PowerUP projects. KIPP SCHOOL We continued our support of the KIPP Jacksonville program, helping the public charter school on the westside expand services to its students with additional classrooms and a renovated and accessorized outdoor playground. 3 President’s Report | John Hirabayashi, CEO and President I am proud to present Community First Credit Union’s Annual Report for 2017. The credit union continues to grow its membership, service to members, and commitment to the First Coast. This report shows unrivaled financial strength and fiscal responsibility to our members, the co-operative owners of our credit union. Last year, our Community First team, our region, and our members experienced growth and improvements, as well as unexpected challenges. I’m honored to share our successes and highlights of our 2017 annual report. By the Numbers Total deposits increased to nearly $1.3 billion dollars, the CORE VALUES highest in our history and an increase of more than 8 percent over the previous Continuous year’s $1.2 billion. Improvement A record for commercial loan originations at $30 million, Innovation a 25 percent increase over the previous year’s $24 million & Creativity and all loaned to businesses on the First Coast. We also provided the largest commercial loan in our history, $4.7 million to an area business. Commercial banking deposits increased more than 16 percent to nearly $60 million. The credit union’s total loan portfolio grew to $1.026 billion, another milestone and a record high. The credit union continues to serve a larger membership in our region every year. Membership grew to more than 126,000 from 119,000 the previous year, a 5 percent increase. 4 In addition to the numbers, Community First continues to invest in our members through advanced technology and enhancements to our branch network. With our branch transformation initiative, now in its third year, we launched more projects than in any other time in recent history. Our team completed a renovation and remodel of the Westside office on 103rd Street in Jacksonville. Despite ongoing construction, the branch remained