KBR HERITAGE FEDERAL CREDIT UNION
ANNUAL REPORT 2022
Your Financial Success Is Our Whole Reason for Being
kbrhfcu.org
CELEBRATING 70 YEARS
A Message from the CHAIRMAN AND PRESIDENT/CEO
In 1953, KBR Heritage FCU founders started the credit union with the vision of helping each other on their financial journeys. As we reflect on 2022 and look to the new year, we’re proud that our purpose remains the same: helping our members on their financial journeys every step of the way. 2022 did not pass without its challenges. Inflation and rising interest rates affected us all. As we look ahead to this new year, we know many are still feeling economic uncertainty. Please know that whatever the economy may bring, your financial well-being remains our focus. With potential storm clouds on the horizon, you can also rest assured that your credit union is well-prepared to face them. Through your loyal support, KBR Heritage FCU ended 2022 with a net worth of 17.2%, well above what regulators consider to be “well-capitalized.” In 2022, the Credit Union funded 709 consumer loans totaling over $10 million and 15 mortgage loans for more than $5 million for our members. With a strong asset base and net worth to support us, KBR Heritage FCU will remain measured and methodical in our approach to any upcoming economic turbulence, just like we weathered the 2008 recession and 2020 Covid-19 pandemic. We will continue to keep our members’ needs – your needs – at the forefront. As we reflect on the past and look to the future, we’re excited to continue to help our members work toward their financial goals. We know that when our members are doing well financially, our Credit Union is doing well too! Thank you for trusting us as your financial institution.
Respectfully submitted, Bill Simister, Board of Directors Chairman Regina Lancaster, President/CEO
Minutes of the ANNUAL MEETING
President/CEO Report: Lancaster welcomed everyone attending. With mortgage rates at record lows last year, we had a successful year in refinances and purchases. Another product that we implemented last year was Zelle ® . The CU continues to help those individuals financially impacted by Covid. We were able to adjust loans and offer Skip-a- Pays. If members are interested in more information they are encouraged to contact the CU. Old Business : Chairman Simister asked if there was any old business to discuss. There did not appear to be any. New Business: Chairman Simister asked if anyone had any new business they would like to address at this time. There did not appear to be any. Election Results: Simister announced the election winners: William Simister, Glenn Wong, and Wendell Prothow. Drawings: The meeting continued to the Cash Prize drawings. Leah Sen won $250. The following individuals won $125 each: Calvin Ng and Maritza Vazquez-Trejo. The following individuals won $50 each: Valerie Guerrero, Shirley Townsend, David Ornelas, Paul Kramer, Christopher Johnson, Chris Caswell, Ashok Gandhi, Peggy Isacson, James Griffin, and Vernon Smith. Chairman Simister thanked all the members and guests for attending the meeting. MJ Patel made a motion to adjourn, and it passed unanimously.
The KBR Heritage Federal Credit Union’s Virtual Annual Meeting was called to order by Chairman Simister at 4:30 p.m. on March 29, 2022. Mr. Simister welcomed both members and guests to the meeting. Simister recited the Pledge of Allegiance. Chairman Simister introduced the current Board of Directors: Byron Smith, Jeffery Gaspard, Michael Fink, Sanjay Singh, Paul Kramer, Matt Frank, Aiesha Maxwell, and Tim Mark. Simister then introduced Supervisory Committee Chairman Ron Schielke. Simister introduced the rest of the Supervisory Committee: Mike Tallman, Cindy Mixon, and Wendell Prothow. Simister introduced Regina Lancaster, the Credit Union’s President/CEO. Lancaster then introduced the Credit Union staff: Jennifer Crosby, Timberly Malone, Roxanne Ortiz, Beatriz Loera, Katrina Roberts, Debra Ligon, Deanna Robinson, and Angela Pittman. Kramer was introduced as the Nominating Committee Chairman. Simister then introduced the candidates: Wendell Prothow, Chadi Saade, Librada Maribel Villarreal, Jeffery Gaspard, William Simister, Glenn Wong, and Derryle Simpson Eubanks. Voting was conducted from March 21-25. Minutes of the Meeting: Simister then presented the minutes of the April 13, 2021, Annual Meeting. James Griffin made a motion to accept the minutes as presented. Anita Moore seconded the motion and it passed. Chairman’s Report: Simister asked that members refer to the Chairman’s Report in the Annual Report. Treasurer’s Report: Simister asked that members refer to the Treasurer’s Report and the CU’s financials in the Annual Report. Supervisory Committee Report: Simister asked that members refer to the Supervisory Committee Report in the Annual Report.
Zelle ® and the Zelle ® related marks are wholly owned by Early Warning Services, LLC, and are used herein under license.
Statement of FINANCIAL CONDITION
December 31, 2022
Assets: Loans, Net of Allowance for Loan Losses of $368,235 Cash and Cash Equivalents Investments Accrued Interest on Loans and Investments Furniture, Equipment and Leasehold Improvements Less: Accumulated Depreciation and Amortization NCUA Share Insurance Capitalization Deposit Cash Surrender Value of Credit-Union-Owned Life Insurance Policies
$40,176,078 308,278 44,825,625 234,309 317,959 (306,519) 735,934 3,203,531 418,280 $89,913,475
Other Assets Total Assets
Liabilities: Dividends Payable Drafts Payable Other Accounts Payable and Accrued Liabilities Total Liabilities Equity: Shares Share Drafts Member Certificates PFC ACF Owners of Asset 03511740 WMBFFO (nonmember certificates of deposit) Undivided Earnings Total Equity Total Liabilities and Equity
$0 181,359 269,076 $450,435
$54,857,660 17,166,385 352,203
1,992,000 15,094,792
$89,463,040 $89,913,475
Statement of Income Year Ended December 31, 2022
Income from Credit Cards Income from Real Estate Loans Income from Other Loans Income from Investments Other Income Total Operating Revenue Compensation and Benefits Educational and Promotional Loan Servicing Provision for Loan Losses Professional Services Office Operating Expense Other Operating Expense Total Operating Expense
$146,676 420,065 956,948 447,819 797,320 $2,768,828
$718,149 20,927 85,186 8,030
399,334 296,451 60,099 $1,588,176
Increase in Cash Surrender Value of Credit-Union-Owned Life Insurance Policies
$85,915
Net Income Before Dividends Dividends Net Income
$1,266,567 64,633 $1,201,934
Statement of Changes in Retained Equity December 31, 2022
Undivided Earnings
$13,892,858 1,201,934 $15,094,792
Balance January 1, 2022 Year-to-Date Net Income Balance December 31, 2022
Statement of Cash Flows December 31, 2022 Increase or (Decrease) in Cash and Cash Equivalents Cash Flows from Operating Activities: Net Income Adjustments for Non-Cash Operating Activities: Depreciation and Amortization of Fixed Assets and Leasehold Improvements Net Increase in Accrued Interest on Loans and Investments Net Decrease in Accounts Receivable and Other Non-Cash Assets Net Increase in Drafts Payable
$1,201,934
6,225 (58,995)
1,208,242 99,350 (24) (1,503) $2,455,229
Net Decrease in Dividends Payable Net Decrease in Other Liabilities Net Cash Used by Operating Activities Cash Flows from Investment Activities: Net Increase in Loans Net Decrease in Investments
$(13,717,923) 20,757 (1,617) (4,564)
Net Increase in Fixed Assets and Leasehold Improvements Net Increase in NCUA Share Insurance Capitalization Deposit Net Increase in Cash Surrender Value of Credit-Union-Owned Life Insurance Policies Net Cash Used by Investment Activities
(85,916)) $(13,789,263)
Cash Flows from Financing Activities: Net Decrease in Shares Net Increase in Share Drafts Net Decrease in Member Certificates Net Increase in Nonmember Certificates Net Cash Used by Financing Activities
$(4,813,031) 1,239,737 (24,676) 1,992,000 $(1,605,970)
$(12,940,004)
Net Decrease in Cash and Cash Equivalents
$13,248,282
Cash or Cash Equivalents at Beginning of Year
$308,278
Cash or Cash Equivalents at End of Year
SUPERVISORY COMMITTEE REPORT
The Supervisory Committee is appointed by the Board of Directors to act as the member’s representatives in ensuring the safety and soundness of your credit union. The Supervisory Committee is confident in reporting that throughout 2022, KBR Heritage FCU maintained a well-capitalized net worth ratio while meeting the regulatory guidelines set forth by the State of Texas and its federal regulatory bodies. In July, the National Credit Union Association conducted an exam to ensure that your credit union is current with all rules and regulations. We are confident that KBR Heritage Federal Credit Union is meeting the needs of its members, continuing to keep current with the rules and regulations while providing a safe and sound option for your financial needs.
BOARD OF DIRECTORS Bill Simister, Chairman Tim Mark, Vice Chairman Michael Fink, Treasurer Aiesha Maxwell, Secretary Matt Frank Paul Kramer Wendell Prothow
Sanjay Singh Glenn Wong
SUPERVISORY COMMITTEE Ron Schielke, Chairman
Ron Schielke, Supervisory Committee Chair
Elizabeth Garza Michael Tallman Cindy Mixon
TREASURER’S REPORT
The Annual Report to the membership contains complete statements of KBR Heritage FCU’s financial condition, income, reserves, and retained earnings for 2022. We had a prosperous year, and these results are demonstrative of our financial strength, as well as the continued support of our members. Your money is safe and secure at KBR Heritage FCU. Our members’ shares are insured up to $250,000. We follow state and federal laws pertaining to operations. In summary, the strong commitment and expertise of our Board of Directors, Supervisory Committee, and our professional management team ensures that KBR Heritage FCU remains a sound financial institution. We will remain vigilant representatives of our members’ interests, ensuring KBR Heritage FCU’s financial soundness, as your credit union continues to provide you and your family with the highest level of member service.
KBRHFCU STAFF Regina Lancaster,
President/CEO Jennifer Crosby, Vice President of Operations Roxanne Ortiz, Member Service/Teller Manager Katrina Roberts, Loan Department Manager Vivian Adams, Member Service Representative Debra Ligon, Member Service Representative Beatriz Loera, Accounting Support Specialist
Angela Pittman, Loan Processor Deanna Robinson, Loan Officer
Michael Fink, Treasurer
KBR Heritage Federal Credit Union 601 Jefferson St., KT-02 Houston, TX 77002 713-753-3022
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