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Keeping Members at Heart Members Choice Credit Union 2022 Annual Report

Offering the Human Side of Banking

Banking is more than just numbers and transactions — it's about the people behind them and their everyday moments. That's why we are committed to delivering personalized services to each one of our members, allowing them to focus on what's most important in life.

Built upon the cooperative spirit of credit unions and a people-helping-people mentality, our members drive each decision we make.

As our world becomes increasingly digital, our commitment to you is to offer technologically-advanced products and services while providing a human touch.

Message from the Chairman

Reflecting on 2022 and moving forward in 2023, we are confident — now more than ever — in the strength of the credit union movement. We remain financially stable and unwavering in our commitment to our members — the heart of who we are. Built on a firm foundation of 80-plus years, we look forward to the next 80 with optimism, knowing that our path forward is resilient.

Whatever the future holds, and regardless of how the industry evolves, one thing is certain: the people-helping-people philosophy of credit unions will always serve as a beacon at Members Choice, guiding our actions and decisions daily as we strive to do what is best for our members. We believe that the more we invest in the cooperative spirit of credit unions, the more we can help our fellow human beings achieve financial well-being and the quality of life each of us so richly deserves. With every deposit made, we positively impact the life of someone else.

The people-helping-people philosophy extends well beyond our branches and into the communities where we live and work. As part of our ongoing strategy, we continue to look for opportunities to make a difference in the lives of others.

Whether you are a long-standing member or a new member, we are grateful you have chosen Members Choice for your banking needs. We promise to consistently offer and enhance our banking services and products to help all members meet their financial goals.

Thank you for being a part of the Members Choice Credit Union family, Johnny Williams, Chairman of the Board

Letter from the President & CEO

I am proud to be serving and supporting you, as the CEO of Members Choice Credit Union. First and foremost, our primary responsibility is to you, our valued members, and that is reflected in how we wholeheartedly live our people-helping-people mission. Helping our members achieve financial well-being is at the heart of what we do.

2022 was a record-breaking year on several fronts. Because of this we enabled more members to fulfill their dreams of taking out a mortgage, purchase a new vehicle, or send a child to college. We also helped our members stretch their hard-earned dollars further to make the increased cost of living a bit easier.

This past year, we overhauled our technology to enhance our digital capabilities. As a result, our members experienced an increased level of convenience in accessing their online accounts and managing their money. Additionally, the technology updates enabled us to fund loans faster, helping our members achieve a greater quality of life. With each loan, lives were changed as members received keys to their first home, could pay mounting bills, and had the opportunity to consolidate debt.

Always keeping our members’ best interests at heart, we introduced several more member-centric initiatives in 2022, including the “Helping Heroes” Savings Program, extending an array of incentives to those in heroic professions who serve and support our communities each and every day. We also launched our Teachers “Supply Loan” Program, offering an interest-free loan to help out our hardworking and dedicated educators.

As we move into 2023, Members Choice will remain laser-focused on our members, upgrading more digital offerings and tools to make banking easier and supporting them as we continue to live in an increasingly fast-paced world. At the same time, we will continue to roll-out additional member-centric products and services to create more personalized banking experiences and fulfill the financial goals for each member.

Built upon the credit union philosophy of people-helping-people, we continue to be active in the local community, increasing our commitment to community organizations through volunteerism and sponsorship as we extend a helping hand to our friends and neighbors.

In 2023 and beyond, we look forward to putting more financial literacy resources in place so members can enjoy peace of mind about their money matters.

Members are the heartbeat behind every decision and experience we offer. We are fortunate to have a team of dedicated employees who provide unparalleled member service every day, and I’d like to thank them for recognizing that our members represent so much more than account numbers.

Thank You, Luke Billeri, President & CEO

Products and Programs

Keeping our Members at Heart

We know our members have lives to lead and moments to enjoy. Banking should be the least of your worries. It's what drives us to continually enhance some of our products and services, consistently delivering banking centered on you.

Securing Your Savings Future

Certificates of Deposits (CD) and CD Rate Boost

Keeping our members at heart means building products that provide hassle-free ways to earn more money. So we are here for you whether you are throwing a wedding, planning a bucket list vacation, or saving for retirement.

Securing your savings became easier in 2022 with our promotional Certificates of Deposit (CD) and CD Rate Boost Program, which allows our members to increase their rates on all newly opened regular and jumbo CDs regardless of the term.

The CD Rate Boost Program gives our members confidence and peace of mind, knowing you are prepared for whatever lies ahead.

Variable High-Yield Money Market

We also recently introduced our Maximum Money Market™ account, enabling our members to earn high yields while maintaining flexible access to their funds. So you can save confidently, knowing you’re always getting the best possible savings rate.

Designed with our members in mind, the Maximum Money Market account provides our members with the ability to earn high yields while having the flexibility to add or withdraw funds at any time.

Helping You Achieve Financial Well-Being

Managing your finances is as important as eating right, exercising, and getting plenty of rest. Worrying about money can affect our mental and physical well-being in ways most may not realize. It’s more than managing money well for financial security; it’s about managing your life. This is why we’ve added more tools and resources for members to achieve financial wellness, including financial reviews at each local branch. We’ll sit down with you to discuss your credit report and goals from a financial perspective.

Over the past year, we’ve also increased the amount of helpful content on our website, produced more videos on money management, and begun offering mortgage seminars to break down the sometimes overwhelming process of buying a home. We want our members to achieve financial well-being to experience a fulfilling and rewarding life

Take a step towards achieving financial wellness today by reading our blog for valuable resources and insights.

Helping Our Heroes

At Members Choice, we believe those in heroic professions should be acknowledged for all they do to protect and serve our communities. That is why in 2022, we launched the "Helping Heroes" Savings Program to express our gratitude. We extended special savings rates and loan discounts to our members in law enforcement, first responders, educators, healthcare professionals, those serving in the military, and veterans, so they can purchase a home or a new car or start putting money away for the future. It was our way of saying "thank you" to our everyday heroes for all they have done for us and our local communities.

Share with a community hero in your life to lend a helping hand.

Sharing is Caring

Our focus on you drives every decision and experience we offer, including enhancements to our Member Referral Program.

Sharing the benefits of lower rates and higher returns by banking at Members Choice has always come with rewards. In 2022, we improved our already robust referral program by adding the HomePlus Personal Loan offer, which is perfect for that friend or family member needing extra cash for bills, to complete home improvement projects, or just for some peace of mind. Plus, we recently added a $250 Mortgage Home Loan referral to the program, to help make sharing the word to a friend or family member even more rewarding.

Passing along the rewards and benefits of being a member helps you, your friends, and your neighbors.

Making Your Money Work For You

We frequently look at ways to help our members put more money in their pockets through increased rates and fee savings, and our new Complete Checking account checks off all the boxes.

We launched Members Choice Complete Checking™, a high-yield checking account that also earns cash-back rewards on everyday debit card purchases to help our members earn more with the convenience of a checking account. Developed with your specific needs, the Complete Checking also comes with no service fees or minimum balance requirements. Members Choice Complete Checking comes with various additional benefits, such as including the opportunity to enroll in Early Pay, which helps members get any direct deposits up to two days early.

A more rewarding checking account with no minimums or monthly maintenance fees.

Expanded Services

Offering Added Convenience

We know life is chaotic. You are constantly pulled in different directions; time is a precious commodity. The Members Choice team is always working hard behind the scenes to improve our technology and overall member experience.

Here are just a few ways we expanded our services in 2022, furthering our dedication to offering human-centered banking:

Keeping our members at the heart of our products and services helps us deliver banking with a human touch every day.

Value Added Services

Getting to the Heart of the Matter

Caring for our members also means caring for our local communities. We’re always looking for ways to increase the value we bring to you daily and what we can do to improve and uplift the lives of others.

Keeping a Pulse on our Members

Because our members are the heartbeat of everything we do, we constantly seek their feedback to improve our products and services. Your valuable input drove us to streamline our online banking messages and email communications in 2022. We also adjusted our online account opening process to increase turnaround time and continuously look for ways to improve this process daily. Using your insights as our guide, we were able to open accounts online via our Member Services team for 807 members this past year.

Empowering Our Youth

Investing in the business leaders, social advocates, volunteers, and forward-thinking citizens of tomorrow is essential, so we support community initiatives like Lemonade Day - Katy.

Lemonade Day is a free, fun, experiential learning program that teaches youth how to start and operate their own business and the basics of entrepreneurial learning. This hands-on experience teaches children business skills, financial literacy, teamwork, social-emotional skills, goal setting, and responsibility. They learn to set goals and create plans while realizing their entrepreneurial vision.

Serving with Heart

Being involved in the communities we serve is at the heart of what Members Choice represents. We have always prioritized giving back as part of promoting the people- helping- people philosophy of credit unions.

As part of our Members Choice CARES program, we continued our support of Katy Christian Ministries by volunteering, spearheading a food drive before Thanksgiving, and adopting five families through the nonprofit’s Santa’s Sleigh program. We also volunteered with Citizens for Animal Protection, the Fort Bend Women’s Shelter, Memorial Assistance Ministries, and many others.

Working collaboratively with the Gulf Coast Regional Blood Center, we held several blood drives throughout the year, encouraging employees and members to give the gift of life by rolling up their sleeves.

As we continue to move forward and evolve into the credit union of the future, our commitment to doing well by doing good in our community will never change.

Message from the Treasurer: Wilfred Krenek

As a member of the Asset & Liability Committee (ALCO), our primary responsibility is to ensure the financial stability and ongoing success of Members Choice Credit Union. We achieve this by carefully monitoring interest rate risk and analyzing potential scenarios. The management team has operational effectiveness practices in place with ALM First, a recognized leader in asset and liability management. Our objective is to maintain the capital required to serve our valued members effectively.

We are pleased to report that Members Choice Credit Union has maintained its financial strength and security throughout 2022. With capital available to lend and profits to reinvest for our members, the credit union concluded the year with a net income of $6.5 million.

In 2022, the credit union increased total loans 31% over the previous year, to $562 million, including allowance. This was a record year for loan growth and indicates the need to maintain our capital ratios and liquidity in order to help serve more of our members through lending. As an organization, we continue to earn our primary source of income through loan interest, and not through fees to members – our fee income is below industry averages. It is important to note that as policymakers increase scrutiny in this area, we are already ahead of the curve.

As evidenced by our financial performance, we remain “well-capitalized” as defined by our regulators. Detailed financial statements further support our strong performance. We extend our gratitude to the Board, management, and staff for their ongoing commitment to sound business practices, investment in technology, and long-term strategic view to manage the fluctuations in the economy.

Lastly, we sincerely thank you for your continued membership and support. It is an honor to serve you as the Treasurer of Members Choice Credit Union, and we look forward to another successful year ahead.

Message from the Supervisory Committee Chair: Tonya Jordan

The Supervisory Committee ensures that audits are conducted on a regular basis and that established internal controls effectively maintain and protect the credit union and its membership. We are pleased to report on the success of our annual audit and exams.

CliftonLarsonAllen LLP performed the annual audit of the books and records of Members Choice Credit Union, for the period ending December 31, 2022. The audit was made in accordance with industry auditing standards and confirmed the credit union’s adherence to Generally Accepted Accounting Principles (GAAP). In their opinion, the financial statements of the credit union present fairly in all material respects the financial position of the credit union as of December 31, 2022.

Additionally, the credit union undergoes extensive annual examinations by the National Credit Union Administration (NCUA) and the Texas Credit Union Department (TCUD) to review industry risk areas. In 2022, the NCUA added additional “Sensitivity to Market Risk” monitoring for all credit unions to review exposure from changes in market prices and interest rates. The credit union maintained a satisfactory rating, indicative of general financial soundness.

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