A N N U A L R E P O R T
Serving Our Members and Their Families Since 1955
BOARD OF DIRECTORS
Shirley R. Watson – Chairman
Edward G. Doster – Vice Chairman
Timothy P. Kiernan – Treasurer
John F. Adragna – Secretary
John J. Brody – Director
Denis A. Burgoyne – Director
Richard A. Rapp, Jr. – Director
Paul F. Scollan – Director
Tina M. Spy – Director
EXECUTIVE STAFF
Bret W. Sears – President/CEO
Randy J. Wiley – EVP/CFO
Craig A. Booth – VP/CIO
John McGregor – VP/Retail Delivery
Paul D. Young – VP/COO
SUPERVISORY COMMITTEE
John F. Adragna – Chairman
Elizabeth Cardone
Jerome Gaetani
Leslie Maddison
GENERAL COUNSEL
Pugatch & Nikolis
220 Mineola Blvd.
Mineola, NY 11501
631-851-1100 • islandfcu.com
Hauppauge Main Office
120 Motor Parkway
Hauppauge, NY 11788
Bellmore
2752 Sunrise Highway
Bellmore, NY 11710
Hicksville
85 East Old Country Road
Hicksville, NY 11801
Massapequa
824 Hicksville Road
Massapequa, NY 11758
Sayville
4820 Sunrise Highway
Sayville, NY 11782
Selden
920 Middle Country Road
Selden, NY 11784
Riverhead
1071 Old Country Road
Riverhead, NY 11901
Stony Brook University
Student Activities Center
Health Sciences Center
Locations
Supervisory Committee Chairman’s Message
Appointed by the Board of Directors, the Supervisory Committee
o
versees the operations and internal controls of Island Federal Credit
Union. A primary responsibility of the Committee is to ensure that
strong policies and procedures are in place to protect members’ funds.
The Supervisory Committee also ensures that Island is operating in
accordance with required financial reporting objectives established by
t
he National Credit Union Administration (NCUA), accounting principles
generally accepted in the United States of America (GAAP/USA) and
other regulatory guidance.
The Supervisory Committee, along with Island’s Internal Audit function,
coordinates periodic examinations by the NCUA, as well as an annual
audit of the credit union’s financial statements by an independent certified
public accounting (CPA) firm. The Internal Auditor also reviews certain
financial accounts and transactions to confirm the accuracy of balances
and the adequacy of internal controls.
The Supervisory Committee’s volunteer members are actively involved in
monitoring the credit union’s activities with your best interests in mind.
We are committed to ensuring your satisfaction with Island’s products and
services. In this regard, if you have any questions, concerns or comments
about your account, please contact the credit union directly. If you require
further assistance, you are welcome to contact the Supervisory Committee
at [email protected] to address your concerns and facilitate a
fair resolution.
The success of Island Federal Credit Union is supported by the dedicated
efforts of Island’s Management and Staff, as well as my fellow volunteers
who serve on the Supervisory Committee and Board of Directors. We
understand the importance of having a safe, sound place to conduct
your financial transactions. We value your membership and appreciate
that you are part of Island Federal Credit Union.
John F. Adragna
Supervisory Committee Chairman
Federally Insured by NCUA
Federally Insured by NCUA
Gross Income Allocation
As of December 31, 2017
■
Dividends $ 9,054,294 23%
■
Interest On Borrowings 3,827,314 10%
■
Operating Expenses 19,068,140 49%
■
Undivided Earnings 6,795,434 18%
Total $38,745,181 100%
Chairman’s Message
The year 2017 marks 10 years since Island Federal Credit Union transitioned from a single-sponsor credit union to a
community credit union that is open to nearly all Long Islanders. When we first made this charter change, we promised
that while our field of membership would grow, Island would remain as committed to our members as we have throughout
our history. We are proud to say that we continue to uphold that promise.
While we have grown to be a $1.4 billion credit union with nearly 40,000 members, Island continues to put its members
first. We offer high quality financial products that serve you throughout a lifetime. These include savings and certificate
products with competitive rates, loans and mortgages with some of the lowest rates around and free checking with a
state-of-the-art mobile app. What truly distinguishes Island from other financial institutions is our experienced, member-
oriented staff. It is not surprising that Island was once again named by Long Island Business News as one of the ‘Best
Places to Work’ on Long Island.
Island is known in our community, not just for our premier banking services, but for being a great supporter of organizations
that make Long Island an even better place to live, work and raise a family. In 2017, we provided funding for Long Island
Cares’ Homeless Outreach program so that they could distribute healthy meals to some of our neighbors who aren’t
served by other charities. Island also provided philanthropic support to the Hope For The Warriors
®
, the John Theissen
Children’s Foundation and the Stony Brook Children’s Hospital (SBCH), among others. Of course, our largest and most
important philanthropic effort, as well as the effort that defines us, is the Island Federal Credit Union Scholarship Program
which gives out $50,000 annually to local high school seniors. Since its inception in 1992, Island has provided scholarships
to more than 290 high school seniors, totaling more than a half-million dollars.
None of these accomplishments would be possible without the support of you, our member-owners. On behalf of our
volunteer Board of Directors, Supervisory Committee, our Executives and Staff, I want to express my personal gratitude
for your membership and continued support of Island Federal Credit Union.
Shirley R. Watson
Chairman
President’s Message
We are exceptionally proud to report that once again Island Federal Credit Union had strong financial performance in 2017.
W
e experienced another record-breaking year with Assets nearing $1.4 billion, a 12% increase versus 2016. Deposits grew
to $1.0 billion, representing a 10% increase, and Loans increased to $.7 billion, also a 10% increase.
At Island, our mission is to provide an exceptional banking experience for those who live or work on Long Island. To accomplish
t
his goal, Island offers a full menu of banking products and services with rates and fees that are among the very best on
Long Island.
W
hile it is important to provide affordable banking services, Island is equally dedicated to ensuring that banking at Island
is convenient no matter where you may live, work or travel. Whether you are banking in-person with our branch staff,
accessing our state-of the-art mobile banking or calling a member representative at Island Anytime 24/7, we strive to
provide the same exceptional member service.
Finally, we are committed to adding new products and services to improve the member experience, such as these new
services added in 2017:
• The CO-OP ATM Network. When combined with the Allpoint ATM Network, Island now offers more than 75,000
surcharge-free ATMs, a total that is unsurpassed by any other local credit union.
• A new First-time Car Buying program. This program helps those just starting out their career to purchase a vehicle
and start to build credit.
• Expansion of our Mortgage offerings and educational seminars. These programs
aim to make it easier for first-time homebuyers to get the home of their dreams.
• Island Financial Services that offers investment and retirement planning,
annuities and other services for our members.
Thank you for your membership and the ongoing support of Island’s mission.
We look forward to serving you in 2018 and beyond.
Bret W. Sears
President/CEO
At December 31
2017 2016
ASSETS
Cash $ 3,586,740 3,956,615
Cash on Deposit in Other Financial Institutions 16,620,049 35,470,392
Investments:
Available-for-sale securities 604,288,930 503,877,144
FHLB Stock 14,058,600 12,185,100
Loans 692,102,866 628,408,798
Deferred loan origination expense 4,352,205 3,358,005
Allowance for loan losses (1,653,697) (1,535,586)
Premium/(Discount) Loans Purchased 1,058,756 359,288
Loans Held for Sale 927,360 –
Accrued interest income 3,539,375 2,726,035
Deposit in National Credit Union Share Insurance Fund 8,683,177 7,719,737
Property and equipment, net of accumulated
depreciation and amortization 12,183,278 12,665,716
Prepaid expenses and other assets 35,000,956 35,374,444
$ 1,394,748,595 1,244,565,688
LIABILITIES AND MEMBERS' EQUITY
Liabilities:
Members' share accounts $ 998,973,566 905,199,828
Borrowings 282,100,000 237,600,000
Accrued expenses and other liabilities 17,085,541 14,554,051
1,298,159,107 1,157,353,879
Members' Equity:
Regular reserve $ 7,551,186 7,551,186
Undivided earnings 108,779,590 101,984,156
Equity acquired in merger 307,339 307,339
Accumulated other comprehensive income (20,048,627) (22,630,872)
96,589,487 87,211,809
$ 1,394,748,595 1,244,565,688
For the Years Ended December 31
2017 2016
INTEREST INCOME
Interest on loans $ 19,673,089 16,446,692
Interest on investments 14,299,412 12,407,703
33,972,501 28,854,395
I
NTEREST EXPENSE
Dividends on share accounts 9,054,294 7,417,438
Interest on borrowed funds 3,827,314 1,734,421
12,881,607 9,151,859
Net interest income 21,090,894 19,702,536
Provision for loan losses 720,000 960,000
Net interest income after provision 20,370,894 18,742,536
for loan losses
NON-INTEREST INCOME
Fees and other operating revenues 3,891,134 3,404,562
Gain on sale of investments 1,601,546 3,227,459
Other non-operating income – –
Gain/(Loss) on disposition of Assets – –
5,492,680 6,632,021
25,863,573 25,374,557
NON-INTEREST EXPENSES
Compensation 5,482,046 5,857,228
Employee benefits 1,829,899 1,794,901
Travel & Conference 147,475 136,518
Office occupancy expenses 2,233,391 2,197,455
Office operations expenses 4,368,774 3,961,917
Educational and promotional expenses 1,830,816 1,723,590
Loan servicing expenses 2,100,034 1,570,071
Professional and outside development expenses 760,472 733,243
Corporate CU Stabilization fund assessment – –
Members' insurance 74,362 60,767
Federal supervision and examination expenses 229,900 175,135
Miscellaneous operating expenses 10,971 831,715
19,068,140 19,042,540
Net income $ 6,795,434 6,332,017
Statements of Financial Condition Statements of Income
Distribution of Shares
As of December 31, 2017
■
Shares $183,525,846 18%
■
Checking 81,127,598 8%
■
Money Market 182,889,496 18%
■
IRA 99,772,729 10%
■
Certificates 439,780,027 44%
■
All Other 11,877,870 1%
Total $998,973,566 100%
2013 2014 2015 2016 2017
Loans $ 330,540,113 $ 393,826,194 $ 484,913,825 $ 628,408,798 $ 692,102,866
Shares 765,084,825 789,392,151 857,657,443 908,199,828 998,973,566
Assets 948,038,313 977,709,673 1,094,384,818 1,244,565,688 1,394,748,595
Millions
$1,500
1,400
1,300
1,200
1,100
1,000
900
800
700
600
500
400
300
200
100
0
Total Loan, Share & Assets
Financial Overview
Gross Income Allocation
As of December 31, 2017
■
Dividends $ 9,054,294 23%
■
Interest On Borrowings 3,827,314 10%
■
Operating Expenses 19,068,140 49%
■
Undivided Earnings 6,795,434 18%
Total $38,745,181 100%
Chairman’s Message
The year 2017 marks 10 years since Island Federal Credit Union transitioned from a single-sponsor credit union to a
community credit union that is open to nearly all Long Islanders. When we first made this charter change, we promised
that while our field of membership would grow, Island would remain as committed to our members as we have throughout
our history. We are proud to say that we continue to uphold that promise.
While we have grown to be a $1.4 billion credit union with nearly 40,000 members, Island continues to put its members
first. We offer high quality financial products that serve you throughout a lifetime. These include savings and certificate
products with competitive rates, loans and mortgages with some of the lowest rates around and free checking with a
state-of-the-art mobile app. What truly distinguishes Island from other financial institutions is our experienced, member-
oriented staff. It is not surprising that Island was once again named by Long Island Business News as one of the ‘Best
Places to Work’ on Long Island.
Island is known in our community, not just for our premier banking services, but for being a great supporter of organizations
that make Long Island an even better place to live, work and raise a family. In 2017, we provided funding for Long Island
Cares’ Homeless Outreach program so that they could distribute healthy meals to some of our neighbors who aren’t
served by other charities. Island also provided philanthropic support to the Hope For The Warriors
®
, the John Theissen
Children’s Foundation and the Stony Brook Children’s Hospital (SBCH), among others. Of course, our largest and most
important philanthropic effort, as well as the effort that defines us, is the Island Federal Credit Union Scholarship Program
which gives out $50,000 annually to local high school seniors. Since its inception in 1992, Island has provided scholarships
to more than 290 high school seniors, totaling more than a half-million dollars.
None of these accomplishments would be possible without the support of you, our member-owners. On behalf of our
volunteer Board of Directors, Supervisory Committee, our Executives and Staff, I want to express my personal gratitude
for your membership and continued support of Island Federal Credit Union.
Shirley R. Watson
Chairman
President’s Message
We are exceptionally proud to report that once again Island Federal Credit Union had strong financial performance in 2017.
W
e experienced another record-breaking year with Assets nearing $1.4 billion, a 12% increase versus 2016. Deposits grew
to $1.0 billion, representing a 10% increase, and Loans increased to $.7 billion, also a 10% increase.
At Island, our mission is to provide an exceptional banking experience for those who live or work on Long Island. To accomplish
t
his goal, Island offers a full menu of banking products and services with rates and fees that are among the very best on
Long Island.
W
hile it is important to provide affordable banking services, Island is equally dedicated to ensuring that banking at Island
is convenient no matter where you may live, work or travel. Whether you are banking in-person with our branch staff,
accessing our state-of the-art mobile banking or calling a member representative at Island Anytime 24/7, we strive to
provide the same exceptional member service.
Finally, we are committed to adding new products and services to improve the member experience, such as these new
services added in 2017:
• The CO-OP ATM Network. When combined with the Allpoint ATM Network, Island now offers more than 75,000
surcharge-free ATMs, a total that is unsurpassed by any other local credit union.
• A new First-time Car Buying program. This program helps those just starting out their career to purchase a vehicle
and start to build credit.
• Expansion of our Mortgage offerings and educational seminars. These programs
aim to make it easier for first-time homebuyers to get the home of their dreams.
• Island Financial Services that offers investment and retirement planning,
annuities and other services for our members.
Thank you for your membership and the ongoing support of Island’s mission.
We look forward to serving you in 2018 and beyond.
Bret W. Sears
President/CEO
At December 31
2017 2016
ASSETS
Cash $ 3,586,740 3,956,615
Cash on Deposit in Other Financial Institutions 16,620,049 35,470,392
Investments:
Available-for-sale securities 604,288,930 503,877,144
FHLB Stock 14,058,600 12,185,100
Loans 692,102,866 628,408,798
Deferred loan origination expense 4,352,205 3,358,005
Allowance for loan losses (1,653,697) (1,535,586)
Premium/(Discount) Loans Purchased 1,058,756 359,288
Loans Held for Sale 927,360 –
Accrued interest income 3,539,375 2,726,035
Deposit in National Credit Union Share Insurance Fund 8,683,177 7,719,737
Property and equipment, net of accumulated
depreciation and amortization 12,183,278 12,665,716
Prepaid expenses and other assets 35,000,956 35,374,444
$ 1,394,748,595 1,244,565,688
LIABILITIES AND MEMBERS' EQUITY
Liabilities:
Members' share accounts $ 998,973,566 905,199,828
Borrowings 282,100,000 237,600,000
Accrued expenses and other liabilities 17,085,541 14,554,051
1,298,159,107 1,157,353,879
Members' Equity:
Regular reserve $ 7,551,186 7,551,186
Undivided earnings 108,779,590 101,984,156
Equity acquired in merger 307,339 307,339
Accumulated other comprehensive income (20,048,627) (22,630,872)
96,589,487 87,211,809
$ 1,394,748,595 1,244,565,688
For the Years Ended December 31
2017 2016
INTEREST INCOME
Interest on loans $ 19,673,089 16,446,692
Interest on investments 14,299,412 12,407,703
33,972,501 28,854,395
I
NTEREST EXPENSE
Dividends on share accounts 9,054,294 7,417,438
Interest on borrowed funds 3,827,314 1,734,421
12,881,607 9,151,859
Net interest income 21,090,894 19,702,536
Provision for loan losses 720,000 960,000
Net interest income after provision 20,370,894 18,742,536
for loan losses
NON-INTEREST INCOME
Fees and other operating revenues 3,891,134 3,404,562
Gain on sale of investments 1,601,546 3,227,459
Other non-operating income – –
Gain/(Loss) on disposition of Assets – –
5,492,680 6,632,021
25,863,573 25,374,557
NON-INTEREST EXPENSES
Compensation 5,482,046 5,857,228
Employee benefits 1,829,899 1,794,901
Travel & Conference 147,475 136,518
Office occupancy expenses 2,233,391 2,197,455
Office operations expenses 4,368,774 3,961,917
Educational and promotional expenses 1,830,816 1,723,590
Loan servicing expenses 2,100,034 1,570,071
Professional and outside development expenses 760,472 733,243
Corporate CU Stabilization fund assessment – –
Members' insurance 74,362 60,767
Federal supervision and examination expenses 229,900 175,135
Miscellaneous operating expenses 10,971 831,715
19,068,140 19,042,540
Net income $ 6,795,434 6,332,017
Statements of Financial Condition Statements of Income
Distribution of Shares
As of December 31, 2017
■
Shares $183,525,846 18%
■
Checking 81,127,598 8%
■
Money Market 182,889,496 18%
■
IRA 99,772,729 10%
■
Certificates 439,780,027 44%
■
All Other 11,877,870 1%
Total $998,973,566 100%
2013 2014 2015 2016 2017
Loans $ 330,540,113 $ 393,826,194 $ 484,913,825 $ 628,408,798 $ 692,102,866
Shares 765,084,825 789,392,151 857,657,443 908,199,828 998,973,566
Assets 948,038,313 977,709,673 1,094,384,818 1,244,565,688 1,394,748,595
Millions
$1,500
1,400
1,300
1,200
1,100
1,000
900
800
700
600
500
400
300
200
100
0
Total Loan, Share & Assets
Financial Overview
A N N U A L R E P O R T
Serving Our Members and Their Families Since 1955
BOARD OF DIRECTORS
Shirley R. Watson – Chairman
Edward G. Doster – Vice Chairman
Timothy P. Kiernan – Treasurer
John F. Adragna – Secretary
John J. Brody – Director
Denis A. Burgoyne – Director
Richard A. Rapp, Jr. – Director
Paul F. Scollan – Director
Tina M. Spy – Director
EXECUTIVE STAFF
Bret W. Sears – President/CEO
Randy J. Wiley – EVP/CFO
Craig A. Booth – VP/CIO
John McGregor – VP/Retail Delivery
Paul D. Young – VP/COO
SUPERVISORY COMMITTEE
John F. Adragna – Chairman
Elizabeth Cardone
Jerome Gaetani
Leslie Maddison
GENERAL COUNSEL
Pugatch & Nikolis
220 Mineola Blvd.
Mineola, NY 11501
631-851-1100 • islandfcu.com
Hauppauge Main Office
120 Motor Parkway
Hauppauge, NY 11788
Bellmore
2752 Sunrise Highway
Bellmore, NY 11710
Hicksville
85 East Old Country Road
Hicksville, NY 11801
Massapequa
824 Hicksville Road
Massapequa, NY 11758
Sayville
4820 Sunrise Highway
Sayville, NY 11782
Selden
920 Middle Country Road
Selden, NY 11784
Riverhead
1071 Old Country Road
Riverhead, NY 11901
Stony Brook University
Student Activities Center
Health Sciences Center
Locations
Supervisory Committee Chairman’s Message
Appointed by the Board of Directors, the Supervisory Committee
o
versees the operations and internal controls of Island Federal Credit
Union. A primary responsibility of the Committee is to ensure that
strong policies and procedures are in place to protect members’ funds.
The Supervisory Committee also ensures that Island is operating in
accordance with required financial reporting objectives established by
t
he National Credit Union Administration (NCUA), accounting principles
generally accepted in the United States of America (GAAP/USA) and
other regulatory guidance.
The Supervisory Committee, along with Island’s Internal Audit function,
coordinates periodic examinations by the NCUA, as well as an annual
audit of the credit union’s financial statements by an independent certified
public accounting (CPA) firm. The Internal Auditor also reviews certain
financial accounts and transactions to confirm the accuracy of balances
and the adequacy of internal controls.
The Supervisory Committee’s volunteer members are actively involved in
monitoring the credit union’s activities with your best interests in mind.
We are committed to ensuring your satisfaction with Island’s products and
services. In this regard, if you have any questions, concerns or comments
about your account, please contact the credit union directly. If you require
further assistance, you are welcome to contact the Supervisory Committee
at [email protected] to address your concerns and facilitate a
fair resolution.
The success of Island Federal Credit Union is supported by the dedicated
efforts of Island’s Management and Staff, as well as my fellow volunteers
who serve on the Supervisory Committee and Board of Directors. We
understand the importance of having a safe, sound place to conduct
your financial transactions. We value your membership and appreciate
that you are part of Island Federal Credit Union.
John F. Adragna
Supervisory Committee Chairman
Federally Insured by NCUA
Federally Insured by NCUA