Achieving Results, Making a Difference - Servus Credit Union

2011 Corporate Profile

Our VisionServus Credit Union builds a better world – one member at a time.Our MissionServus Credit Union provides sound, advice-based financial products and services.We are here for our members through all stages of their lives. We help them achievepersonal satisfaction, enjoy financial stability and a good quality of life, and we arecommitted to making a difference in the communities where they live and work.Our ValuesCommunity, Fairness, Integrity, Investing in Our People, Life/Work Balance,Member Service, Teamwork

ContentsMessage from the Board Chair 4Message from the President and CEO 6servus in 2011: Achieving Results 8servus IN 2011: Making a difference 12governance & LEADERSHIP 20feel good about your money.

Message fromPeter ElzingaChair, Board of Directors“Servus truly is a superb organizationwith great people who believe in thecredit union way of banking and in whatmakes Servus Credit Union unique.”4 Servus Credit Union | 2011 Corporate Profile

If I were asked to choose two words to describeServus Credit Union in 2011, they would berewarding and challenging.Rewarding because, three years into our five-yearamalgamation plan, I have seen Servus cometogether with a renewed sense of energy and acommon purpose. I also saw a demonstratedcommitment to exceptional member servicethat is stronger than ever, and a sharper focuson our vision, mission and values.changes in the global economy. The ExecutiveLeadership Team, under the direction ofPresident and Chief Executive Officer GarthWarner, rose to the challenge of ensuring thatdecisions were sound, costs controlled and thecredit union’s focus remained where it neededto be—on the best interests of its memberowners.I’m privileged to serve with suchdedicated and capable individuals and aminspired every day by their passion for thecredit union way.Servus truly is a superb organization with greatpeople—from our Board and executive to ouremployees and our member-owners—who believein the credit union way of banking and in whatmakes Servus Credit Union unique.I am especially proud of the awards we werehonoured with this year from communities likeSlave Lake, Red Deer, Sylvan Lake, Blackfaldsand Lloydminster. As a credit union, Servus iscommitted to making a difference where ourmembers live and work, and these awards tellme we’re succeeding.That commitment to making a difference wasespecially evident amid the tragedy of the SlaveLake wildfires in May. As the extent of the crisisbecame known, Servus quickly began providingmembers in Slave Lake with the financial helpthey needed to start putting their lives backtogether. Members across Alberta donated moneyfor the Red Cross at their local Servus branches,employees raised funds that were matched bythe credit union and Servus brought together agroup of partners to contribute to the long-termrebuilding of the community.Challenging because 2011 was a year of economicuncertainty and Servus Credit Union, whilewell-positioned to manage through, was notimmune to the struggling world market andBecause of the difficult nature of the year,the Board was especially pleased to approve$44.3 million in Profit Share, which is thelargest amount ever distributed to our members.The Board of Directors continued to bechallenged this year with how to increasemember engagement in the credit union.Member-ownership and democratic memberrepresentation are fundamental and vitalelements of our credit union, yet memberparticipation in board elections and annualgeneral meetings is relatively low. We continueto wrestle with the question of how to keep ourmembers involved in their credit union.As we look ahead to 2012, the United Nations’International Year of Co-operatives offers a timelyand important celebration of the contributionsco-operatives, including credit unions, make to thesocial and economic development of communitiesaround the world.Together with other members of the Board ofDirectors, I want to say thank you for supportingServus Credit Union. You can continue to haveconfidence in Servus’ commitment to meetingyour financial needs and its future as a strong,secure credit union. You can take pride in thepart you play in building better communities, abetter Alberta, and a better world.Servus Credit Union | 2011 Corporate Profile5

Message fromGarth WarnerPresident and Chief Executive Officer“Servus Credit Union’s accomplishmentsin 2011 are the result of hard work,commitment and dedication to buildinga better world—one member at a time.”6 Servus Credit Union | 2011 Corporate Profile

Servus in 2011Achieving ResultsPerformance Highlights$44.3 Mshared with membersthrough our ProfitShare Program79.1%Excellent/Very Goodrating in overall memberservice satisfactionSource: Synovate CSI 20113 newor improved branchesto better serve members(Calgary, Westlock, Lloydminster)8 Servus Credit Union | 2011 Corporate Profile

Servus Credit Union has roots going back nearly 75 years to when the firstcredit union was incorporated in our province. Then, Albertans wanted afinancial institution where their needs and interests came first, they had a sayin decisions and they could share in its success. Today, Servus Credit Unioncontinues that tradition, providing our member-owners with a share of theprofits, a voice in the direction of our credit union and expert financial servicesfrom a company that cares about them, their family and their community.Member-owned and member-focusedAs a credit union, Servus exists to serve ourmembers. We are committed to providing themwith expert financial advice through all the stagesof their lives. With a full range of advice-basedproducts and services, our knowledgeable staffhelp members achieve personal satisfaction, enjoyfinancial stability and a good quality of life.Whether they have a home mortgage or achequing account, bank with us for theirbusiness or are one of our dedicated employees,Servus members have a voice in how the creditunion operates by voting for our Board ofDirectors. And they share directly in the creditunion’s successes through the Profit ShareProgram. The more business a member haswith us, the greater their share of the profits.All Servus members can be confident that they’regetting advice that’s just right for them. Ourknowledgeable staff take the time to get toknow each member’s needs, financial goals anddreams for the future. Servus members can alsofeel safe knowing that all the money they depositat Servus, and the interest earned, is fullyguaranteed—up to any dollar amount—by theCredit Union Deposit Guarantee Corporation.Our nearly 390,000 members are diverse, withneeds and goals as varied and unique as they are.$1.4 M6.3% 6.7% 5.7%in communityinvestment activitiesincrease in memberloans to $10 billionincrease to BrandHealth* to 63increase in BrandAwareness* to 74* Brand Awareness is the proportion of consumers who know of our brand, including aided, unaided or top-of-mind awareness of Servus as a financialinstitution. Brand Health is an overall measure of brands’ competitiveness in the market and is known to correlate with market share. Source: IpsosReid Brand Health Equity Tracking 2011Servus Credit Union | 2011 Corporate Profile9

We offer specialty accounts for the young, theyoung-at-heart and everyone in between. For ourmembers 17 to 25 years old, the Young & FreeAlberta program offers a free chequing accountalong with information, tips and ideas to helpyoung adults manage their money wisely and geton track for financial success. Through blog posts,tweets, videos, contests and public appearances,the Young & Free Alberta Spokester promotesthe benefits of our credit union to the nextgeneration of member-owners.At Servus, our commercial members knowbusiness, and we know business banking. Ourrelationship managers work with members to findthe solutions that help them manage everythingfrom their cash flow and investments to theircustomers and employees. Whether a businessis just getting off the ground or growing by leapsand bounds, financial decisions are made locallyand with an understanding of the Alberta marketso members can take advantage of opportunitiesto grow their business and succeed.Providing exceptional member service meanslooking beyond deposits, accounts and mortgagesto understand each member’s lifestyle so we canhelp anticipate their needs now and in the yearsto come. Through Servus Wealth Strategies, weprovide advice on comprehensive financialplanning as well as insurance to help with theunexpected, and trust and estate services to giveour members and their families peace of mind.Our members are our owners, our most importantstakeholders and the reason we’re in business.We’re committed to helping each Servus memberachieve their dreams of a better life, a bettercommunity and a better world.Servus Wealth Strategies Ltd. is a subsidiary of Servus Credit Union Ltd., offering financial planning, life insurance and investments.Performance Summary$8.7$9.3$9.8$10.2$8.4$8.9$9.4$10.0$9.5$10.2$10.8$11.2$883.3$832.2$764.7$695.22008 2009 2010 20112008 2009 2010 20112008 2009 2010 20112008 2009 2010 2011Deposits($billions)Loans($billions)Assets($billions)Member Equity($millions)10 Servus Credit Union | 2011 Corporate Profile

Servus’ Members First philosophy means that our nearly 2,300 employees workhard every day to give members the advice that’s right for them, based ontheir individual needs and financial goals. Members First is about making surethat every employee, whether they work in a branch or a support department,is focused on our members. It’s about building relationships, being proactiveand helping members succeed. It also ensures that no matter which Servuslocation a member visits, they’ll experience the same high standard of careand attention that they’ve come to expect from their credit union.$284.9$260.8$244.4$236.7$42.2 $42.9 $44.3Member SatisfactionRating Excellent/Very Good$33.0 79.1% Overall Satisfactionwith Member Service80.3% Satisfaction withonline banking2008 2009 2010 2011Operating Expenses($millions)2008 2009 2010 2011Profit Share($millions)84.6% Satisfaction withlocal branch serviceSource: Synovate CSI 2011Servus Credit Union | 2011 Corporate Profile11

At Servus, we’re committed to supporting our communities through changingeconomies and environments. We invest in the long-term well-being of ourmembers and the places where they live and work. Our efforts continue to befocused in four primary areas:• Children and youth• Education• Local community initiatives and events• Social services and povertyMaking a Difference...In 2011, we were proud to contribute $1.4 millionto organizations, agencies and projects that shareour commitment to building a better world. Ourcommunity investment decisions were guided byour corporate values and commitments to ourmembers while fulfilling our responsibility toensure the long-term sustainability of our creditunion in an uncertain financial environment.…in our communitiesServus Credit Union is committed to makinga difference in our members’ communities.Demonstrating that commitment, we distributed68% of our total community investment dollarsacross 62 communities for support of localinitiatives and events; the remaining 32% wasfocused on province-wide corporate initiatives.Our support goes beyond providing fundingthrough sponsorships and donations as manyServus employees also gave their time and energyto help community and charitable organizationsreach their goals.We were honoured to be recognized by a number oflocal and community-based awards for contributionsour company and employees made to Alberta’scommunities in 2011 including:• Best of Red Deer awards for Top FinancialInstitution, Friendliest Staff, Best Business toWork for, and Best Customer Service• Alix Chamber of Commerce named our Alix branchtheir 2011 Community Supporter of the Year• Slave Lake Chamber of Commerce’s 2011Employer of the Year• Big Brothers Big Sisters of Lloydminster’sChampion of Magic 2011 award foroutstanding contribution to their agencythrough fundraising and other support• 2011 Business Awards from the Town ofBlackfalds for Community Involvement,Customer Service, and Long Term Business• 2011 National Philanthropy Day recognitionin the Public Service category, nominated bythe Art Gallery of Alberta$23,600 in donations to the Canadian Red Cross. In total, Servus and our partners Deloitte and ToucheLLP, Credential Financial and Temenos contributed approximately $114,000 for rebuilding efforts. Inpartnership with ATB Financial, Servus also bought $2 million in housing that is being made availableat below market rate to attract medical personnel to the community. The crisis may be over in SlaveLake but much remains to be done and Servus Credit Union is committed to being part of rebuildingthis strong and vibrant community.Servus Credit Union | 2011 Corporate Profile13

Making aDifferenceCaja Yanga Credit Union Board of DirectorsPresident Manual Hernandez Moreno(seated, left) and World Council of CreditUnions delegate Joshua Fetting (standing,left) with Servus Board Chair, Peter Elzinga(standing, right), and Director Penny Reeves(seated, right) during the Mexican creditunion’s internship at Servus in May 2011.…across our provinceServus Credit Union is committed to maintaininga local presence in the communities we servewhile also taking advantage of our uniqueprovincial-wide reach to achieve our vision ofbuilding a better world—one member at a time.Through our annual United Way and Sign of Hopecampaign, Servus members and employees helpimprove the quality of lives in our communitiesthrough bake sales, book sales, raffles, pledgingand a wide range of other fundraising activities.This year, we donated $307,534 to the UnitedWay and Catholic Social Services programs inour communities across Alberta.Servus demonstrated our focus on children andyouth and education by establishing a number ofprovince-wide partnerships. Over the next threeyears, Servus will provide financial and volunteersupport to help Junior Achievement in Albertadeliver their Dollars with Sense program. Throughthis partnership, Dollars with Sense will bring thebasics of money management and financialliteracy to 4,000 more classrooms and nearly20,000 Grade 8 students. We also entered intomulti-year agreements with Rotary Internationaland Alberta 4-H to promote youth leadership andactive citizenship among young Albertans.Another way Servus supported young Albertansand their dream of making a difference in the worldwas through our second annual Young & FreeScholarships. We awarded a $1,000 scholarship toeach of 30 students who demonstrated leadershipand the desire to make a positive difference in theworld. More than 175 students sent in video orwritten applications describing how they wouldhelp themselves, their friends or their peersovercome a challenge facing their generation.We continue to be inspired by their passion andcreativity, and are proud to help support our nextgeneration of leaders.…in the credit union systemAt Servus, we believe we have a responsibility tooffer stewardship and leadership in support of arobust and sustainable credit union system in theprovince. This year, we demonstrated our commitmentto the long-term sustainability of creditunions in Alberta by welcoming members fromRoyglenor Credit Union, Industrial Credit Union,Strathfiner Credit Union and Edmonton PostalCredit Union into our organization.We are committed to excellence in businessprocesses, management and innovation so ourmembers and all credit union members can14 Servus Credit Union | 2011 Corporate Profile

continue enjoying the benefits of the creditunion way of banking long into the future. Ourachievements in these areas this year included:• Alberta Venture’s Best Overall Workplacefor Over 750 Employees and Best Workplacefor Benefits; Honourable Mention for BestEmployer Perks and Incentives• Gold medal for credit union innovationfrom the Filene Research Institute awardedto Robert Christiansen, Branch Manager,Medicine Hat – Southview• Re-qualifying as a member of the PlatinumClub of Canada’s 50 Best Managed Companiesfor the third year in a row• Next Top Credit Union Executive titleawarded by the Credit Union Executive Societyto Devin Selte, Corporate Trainer, LeadershipDevelopment and Change Leadership…in our worldServus is also part of the global credit unionand co-operative world. We support the developmentof credit unions beyond our bordersthrough our association with the World Councilof Credit Unions’ International PartnershipProgram and, specifically, our partnershipwith Caja Yanga Credit Union of the state ofVeracruz, Mexico. In May 2011, we hostedtheir Board President and two employees for aninternship on Anti-Money Laundering, CorporateSecurity and Enterprise Risk Management. Servuswill reciprocate in 2012 by sending staff toMexico where the focus will be on marketingand community relations.Representatives from four Louisiana creditunions and the Louisiana League visited Servusin early June 2011 to learn about our strongbusiness banking services. During their visit,the delegates learned about various aspectsof commercial services, including creditapplications, underwriting, cash management,payroll processing and employee solutions.Servus supports employee participation ininternational activities through the CanadianCooperative Association’s employee volunteerprograms. In 2011, a number of Servus employeestravelled to developing countries as mentors, onstudy tours and development trips, or hostedwomen leaders from developing country creditunions. Here are some of these employees’thoughts on their experiences:Stewart Oke, Delburne Branch Manager, went toUganda as part of the Management CoachingProgram. He said, “My experience in Ugandaallowed me to witness the credit union systemworking and thriving at the grassroots level.Although we came from two very differentcultures, our belief in and commitment to thecredit union system brought us together.”Community CouncilsOur 34 Community Councils represent ethnic and geographic communities across Alberta.The councils provide important feedback on how we’re doing and how we can improve.They are also our very best ambassadors, spreading our story to community leaders andcitizens around the province.Servus Credit Union | 2011 Corporate Profile15

In June, Debbie Neddow, a branch manager inEdmonton, and Yvonne Derksma, Director ofAccounting Operations, hosted Alice Kosgei,CEO of Kericho Tea Growers Savings and CreditCo-Operative in Kenya, for 10 days. Debbiesays, “Alice showed our staff and my family thetrue meaning of a credit union with her storiesof how they help the tea growers and womenof Kericho.”Her volunteer mission to Sri Lanka was ahumbling experience for Trish Rasmussen,Team Manager, Commercial/Agriculture inRed Deer. “I was able to see that by providingtools, resources and knowledge, these developingcountries are able to sustain themselves forgenerations to come. I witnessed first-hand howa little bit of financial support can help build anentire community.”For the environmentWaste management and environmentallyfriendly building practices continue to be apriority for Servus Credit Union. Our effortsto decrease waste and increase recycling areseeing significant results.In 2011, we expanded our recycling programto include the Parkland Square regional office inRed Deer and continued our existing programsat seven other locations, including ServusCorporate Centre. In total, we recycled morethan 53 tonnes of paper and cardboard. That’sequivalent to saving roughly 175 cubic feet oflandfill space, 905 trees and 370,000 gallonsof water!Servus also began fluorescent lighting recyclingprograms this year, diverting more than 1,250four-foot tubes and 450 compact fluorescentbulbs, as well as approximately 300 kg of non-PCB ballasts from the landfill. The programs willcontinue and will be expanded in 2012.For our employeesOur commitment to providing exceptional memberservice starts with a recognition that our employeesare also member-owners. Like the members theyserve, employees have a say in how our credit unionis run and a stake in our success. An investmentin our employees is an investment in the futuresuccess of our organization. We invest in life-longlearning, provide opportunities for advancementand help our employees reach their full potential.We are committed to supporting the developmentof the next generation of credit union leaders.Building on the foundation established when we cametogether in 2009 to select our corporate values andin 2010 to define our vision and mission, in 2011we continued to deepen our shared vision andunderstanding of our goals for our credit union in2011. We also began looking more toward thefuture and what we need to do with and for ouremployees to sustain our credit union as a vibrant,successful and growing organization that meetsour members’ needs today and in the future.Here are some highlights from our achievements insupporting, developing and celebrating our employeesin 2011:• Succession plans put in place for all positions abovesenior managers, to ensure we’re supporting thesustainability and long-term success of the company• New payroll and performance management systemswere implemented to support a more efficient andeffective Human Resource Information system forthe future• First annual 35 under 35 Leadership Retreat wasorganized by the Servus Young Leaders Network• 85% of employees attended a learning program,including 227 core training sessions delivered tonearly 1,900 employees and other complementaryseminars and conferences16 Servus Credit Union | 2011 Corporate Profile

Employee service milestones:Putting experience to work for our members578employees22 145 4398employees employees combined yearscelebrated milestonesin 2011with 30 plus yearsof servicewith 10 to 25years of serviceof credit unionexperienceFor members and by members:The Servus Credit Union wayFor nearly 75 years, credit unions in Albertahave provided a better way of banking—thecredit union way. Credit unions put membersand their interests first. They are part of thecommunity and members have a say in thedirection of their credit union.Today and for years to come, Servus CreditUnion brings the credit union way of bankingto Albertans all across our great province. Weinvest in strong and resilient communities,play a leadership role in a robust credit unionsystem, and do our part to help protectthe environment.At Servus, we understand the business of goodbusiness. We work hard to be a strong and profitablecompany, and our members and communities sharedirectly in our successes. We’re member-focused andmember-driven, and we’re here for our membersthrough all the stages of their lives. They come tous for expert financial services and advice on theirpath to financial stability, personal satisfaction anda good quality of life. They are our member-ownersand they are the reason we exist.In everything we do, today and tomorrow, ServusCredit Union builds a better world—one member ata time.Servus Credit Union | 2011 Corporate Profile17

President’s Award of ExcellenceServus’ third annual President’s Award of Excellence rewarded 25 employees with a trip to theannual World Credit Union Conference to engage with the worldwide credit union movementand reconnect with what it means to be a credit union. The recipients were nominated bytheir peers in recognition of their outstanding contributions to Servus’ success.2012: International Year of Co-operativesThe United Nations has declared 2012 as the International Yearof Co-operatives (IYC). As the world celebrates cooperatives,Servus is joining with the Canadian Co-operative Association, theAlberta Communities and Co-operative Association and AlbertaCentral to host and support a series of IYC events across theprovince. Throughout the year, Servus will help increase awareness of the role credit unions andco-operatives play in our lives, enhance relationships with other co-operatives and celebrateco-operative achievements of the past and those yet to come.18 Servus Credit Union | 2011 Corporate Profile

Servus provides our members with exceptional service:• In person at more than 100 locations in 62 communities across Alberta• Online with more than 500 pages of information for life, business and community at servus.ca• At your convenience, 24 hours a day, 7 days a week through TeleService® and online banking®TeleService is a registered trademark of Vancouver City Savings Credit UnionServus isCanada’s onlyprovince-widecredit union:• We’re in 62 communities fromFort McMurray to Lethbridge• Business support centres in Lloydminster,Edmonton, Red Deer, Calgary and Grande Prairie• 34 Community Councils represent Alberta’s ethnic andgeographic communities and help connect us with localleaders and citizens.Servus Credit Union | 2011 Corporate Profile19

Governance &LeadershipBoard of Directors(Standing L–R) William J. (Bill) Anhorn, Penny Reeves, Amy Corrigan, Peter Galloway, Perry Dooley, Jonathon Holt,Sam Cooper, Simon Neigum, Alison Starke; (Seated L–R) Doug Hastings (Vice Chair), Helen Cheung, Peter Elzinga (Chair)20 Servus Credit Union | 2011 Corporate Profile

Servus Credit Union’s Board of Directors represents our member-owners,ensuring they have a voice in the direction of their credit union. By adheringto the principles of openness, transparency, accountability, ethics and ruleof law, they are a strong and effective governing body that keeps the bestinterests of our members top-of-mind.Board MandateThe Board of Directors ensures that Servuscreates and maintains value for stakeholdersand serves the needs of our member-ownersand their communities. The Board sets ourstrategic direction, formulates and monitorspolicies, evaluates organizational performanceand ensures that an effective risk managementframework is in place.The Servus Board of Directors consists of 12members from across the province. They areelected by the membership through in-branchand online voting. Directors are elected fora three-year term. The Board has establishedcommittees to help govern the organizationeffectively and to better manage risk.For complete information about Servus’governance, refer to the Corporate Governancesection of the 2011 Management’s Discussionand Analysis that accompanies this document.A $1 investment is all it takes to get all the benefits of member-ownership,including the opportunity to vote or be nominated for a position on the Boardof Directors. Elections are held each year and all Directors are member-owners.Servus Credit Union | 2011 Corporate Profile21

Executive Leadership Team(Standing back row, L–R) Dan Bruinooge, Ian Glassford, Taras Nohas, Yves Auger;(Standing front row, L–R) Gail Stepanik-Keber, Darrell White, Garth Warner, Darcy PeelarGarthGarthWarnerWarnerDarrell WhiteIan GlassfordDarcy PeelarPresidentPresidentandandChief Executive OfficerChief Operating OfficerChief Financial OfficerChief Risk OfficerChief Yves Auger Executive OfficerTaras NohasChief Information OfficerIan Glassford Vice President StrategyGail Stepanik-Keberand GovernanceYves AugerChief Financial OfficerChief Marketing OfficerChiefDan BruinoogeInformation OfficerDarcy PeelarChief People and Corporate Services Taras OfficerNohasChief Risk OfficerDan Darrell Bruinooge WhiteVice President Strategy Gail Stepanik-KeberChief People Operating and Officerand Governance Chief Marketing OfficerCorporate Services Officer22 Servus Credit Union | 2011 Corporate Profile

Servus Corporate Centre151 Karl Clark Road NWEdmonton, AB T6N 1H5Red Deer Regional Office601, 4901 – 48 StreetRed Deer, AB T4N 6M4Lloydminster Regional OfficeBox 1410, 5012 – 49 StreetLloydminster, AB S9V 1K4Toll Free187SERVUSCU1.877.378.8728servus.cafeel good about your money.Servus Credit Union | 2011 Corporate Profile23

Servus Corporate Centre151 Karl Clark Road NWEdmonton, AlbertaT6N 1H5Toll Free187SERVUSCU1.877.378.8728servus.ca