VLFCU Annual Report

Financial Highlights (*Unaudited) December 31, 2022 2021 2020 2019 2018 Assets Cash and Equivalents 8,280,296 35,460,457 20,743,342 13,906,038 $9,733,483 Investments 96,564,392 99,278,784 68,538,358 57,360,983 51,427,697 Loans 182,169,539 170,162,633 186,858,284 168,893,279 162,656,691 (less) Allowance for Loan Loss (1,956,291) (1,907,734) (1,994,434) (1,647,752) (1,648,114) Land, Building and Equipment, net 6,257,433 6,392,725 6,529,362 6,271,422 6,535,928 Other Assets 2,690,142 3,381,233 2,364,446 2,317,063 2,285,395 Total Assets $ 294,005,511 $ 312,768,098 $ 283,039,359 $ 247,101,033 $ 230,991,080 Liabilities Other Liabilities 1,998,294 1,576,277 422,182 1,706,761 1,306,826 Notes Payable 17,953,632 22,890,764 26,422,133 26,249,276 23,656,249 Total Liabilities 19,951,926 24,467,041 26,844,315 27,956,037 24,963,075 Share Drafts 49,631,234 52,490,965 44,169,764 31,129,260 30,880,958 Shares 167,615,267 165,056,331 136,910,210 112,671,424 110,429,982 Certificates 27,882,733 34,481,047 40,183,547 42,468,332 35,506,709 Non-member Certificates 2,342,287 3,528,817 5,014,798 5,515,900 4,459,104 Total Shares $ 247,471,521 $ 255,557,160 $ 226,278,320 $ 191,784,916 $ 181,276,753 Owners Equity (Capital) Regular Reserves 2,870,959 2,870,959 2,870,959 2,870,959 2,928,513 Accum. Unrealized Gain/(Loss) - AFS (8,281,814) 394,781 1,418,912 216,103 (184,962) Undivided Earnings 31,992,919 29,478,157 25,626,852 24,273,018 22,007,701 Total Equity 26,582,064 32,743,897 29,916,724 27,360,080 24,751,252 Total Liabilities & Owners Equity $ 294,005,511 $ 312,768,098 $ 283,039,359 $ 247,101,033 $ 230,991,080 Income Loan Interest 8,496,052 8,488,359 9,000,011 $9,001,674 $8,204,527 Investment Interest 2,623,762 1,817,943 1,688,164 1,858,409 1,849,357 Non-Interest Income 3,422,597 5,318,923 3,586,228 3,621,678 3,442,985 Gain/(Loss) on Sale of Assets (343,003) 1,240 26,307 28,900 63,197 Total Income $ 14,199,407 $ 15,626,465 $ 14,300,710 $ 14,510,661 $ 13,560,066 Expenses Staffing 5,332,402 5,194,352 5,151,605 5,027,759 4,704,023 Dividends 465,976 737,989 1,251,737 1,293,233 848,661 Interest Expense on Borrowings 423,673 530,021 610,632 605,199 476,969 Provision for Loan Losses 375,000 445,000 1,045,000 610,000 845,000 Operating Expenses 5,087,594 4,867,799 4,887,902 4,766,707 4,480,597 NCUA Stabilization Expense 0 0 0 0 0 Total Expenses $ 11,684,645 $ 11,775,161 $ 12,946,876 $ 12,302,898 $ 11,355,250 Net Income $ 2,514,762 $ 3,851,304 $ 1,353,834 $ 2,207,763 $ 2,204,816 Financial Ratios Return on Average Assets (ROAA) 0.83% 1.29% 0.51% 0.92% 0.99% Net Interest Margin 3.37% 3.03% 3.33% 3.75% 3.91% Operating Expenses to Average Assets 3.43% 3.38% 3.79% 4.10% 4.12% Efficiency Ratio 71.65% 64.40% 70.33% 67.63% 68.05% Loans to Shares 73.61% 66.58% 82.58% 88.08% 89.75% Allowance for Loan Loss to Total Loans 1.07% 1.12% 1.07% 0.98% 1.01% Net Charge-offs to Average Loans 0.18% 0.28% 0.41% 0.37% 0.36% Delinquent Loans to Total Loans 0.51% 0.55% 0.40% 0.87% 0.49% Capital to Assets 11.86% 10.34% 10.07% 10.98% 10.80% Distribution of Income Operating Expenses 10,419,996 10,062,151 10,039,506 9,794,466 9,184,620 Dividends 465,976 737,989 1,251,737 1,293,233 848,661 Capital 2,889,762 4,296,304 2,398,834 2,817,763 3,049,816 Number of Members 20,343 20,392 20,184 19,810 19,435 Number of Employees 69 67 68 73 72 * Copies of audited Financial Statements are available upon request 2023 a Look Ahead In response to the inflation in the broader economy, the Federal Open Market Committee increased the target federal funds rate multiple times throughout the year, ending the year at a target range of 4.25 – 4.50%. Inflation appears to have peaked in June of 2022 when CPI data showed an annualized inflation rate of 9.1%. By the end of 2022, inflation had fallen to 6.5%. The broader market expects the FOMC to continue to remain committed to higher interest rates until inflation is back in line with the FOMC’s mandate of a 2.00% target inflation rate. With a diverse balance sheet consisting of various fixed and variable rate loans, investments, deposits and wholesale funding sources, VacationLand is poised to meet the unique challenges that lie ahead in 2023. Thank you to my co-workers, Board, and Supervisory Committee members for their hard work and dedication to VacationLand. Most importantly, thank you, our members. VacationLand exists to serve its members as a not-for-profit financial cooperative in the north central Ohio area.