FCU-Annual Report-2016

Welcome to Frankenmuth Credit Union’s Annual Report. This is always an exciting time of year: relaying our previous
year’s goals and achievements, parading our new services, recognizing our staff’s commitment to our members
and revealing our financial growth as an organization. But this year, we have even more to boast about. We had a
ribbon cutting to show off the renovations of our Main Street, Frankenmuth, office which includes 40,000 square
feet of new space, improved, easy-approach and speedy drive-thru services, a welcoming teller lobby and a gardenlevel
conference center for all members to enjoy. We also grew in the community by opening branch locations in
Rockford and Elkton.
And, I am thrilled to announce the success of our emergent Frankenmuth Foundation which has donated over
$480,000 to deserving people with worthy causes in over a dozen surrounding communities.
This year, we embark on our roles with a sense of accomplishment but also with the continued challenge of our
purpose: ‘people helping people.’ Life is a journey. We have dreams and good intentions on our horizon. And, we
believe it is the fidelity to our members that the Frankenmuth Credit Union helps find that path to which they yearn
for. It’s a journey you’ll never have to walk alone when you’re a member of the Frankenmuth Credit Union.
OFFICES IN
Saginaw Twp. | Essexville | Reese | Birch Run
Richville | Vassar | Frankenmuth | Otisville
Millington | Birch Run Meijer Dr | Freeland
Cass City | City of Saginaw | Rockford | Elkton
www. frankenmuthcu.org
1-800-221-8880 | 989.497.1600
P. 0. Box 209 | Frankenmuth, Ml | 48734
SATELLITE OFFICES IN
Independence Village - Frankenmuth
Frankenmuth High School | Reese High School
Juniata Christian School | Birch Run High School

e s p e c t
In 1964 Frankenmuth Credit Union was organized by the employees of
Carling Brewery. They were looking for an alternative option for their
financial needs. In the beginning only the employees of Carling Brewery,
Zeilinger Beverage, Geyer’s Brewery and Star of
the West Milling could join the credit union—the
brewers and millers. It wasn’t uncommon in those
early days when someone wanted a loan, if the
credit union didn’t have enough in savings,
credit union staff would walk around the
brewery carrying a shiny silver box asking
employees to give additional deposits. People
helping people!
In 1969 Frankenmuth Credit Union had the
forethought to apply, and was granted, to have its charter changed
to a community charter. This meant that people living or working
in a geographical area could now join the credit union, not just the
employees of certain businesses. Over the years our charter has grown
from townships, to counties and today anyone that lives, works, worships
or was educated in the state of Michigan can join Frankenmuth Credit
Union. Even though we have grown, we are still aware of our humble
beginnings ‘people helping people’. We provide good old-fashioned
hometown service coupled with sound financial advise specific for each
of our members situations. We are rooted in the communities we serve
and make an impact through our staff volunteer hours on community
projects and our foundation.
Today, the Frankenmuth Credit Union is over 32,000 members
strong with 188 employees united in 14 communities.
At Frankenmuth Credit Union we know the
importance of kindheartedness and have always
been proud of the active role our staff and
board have played in impacting the communities
we serve through volunteer hours, monetary
contributions and civic group participation.
We believe in ‘people helping people.’ That’s
why the Frankenmuth Credit Union Foundation
was formed, to provide grants to promote the
betterment of local communities, one smile at a
time. The Foundation was launched in April of
2014 and has since positively influenced over
50 different organizations and thousands of
individuals in a dozen different communities.
Over $448,000 funds have been donated to
worthy causes including:
—Child care equipment for local schools
—Google Books for local schools
—Reese scoreboards
—Harvey Kern Pavilion nets and heat
—Millington community pavilion
—Juniata Christian School technology upgrades
—Reese Trinity Lutheran bleachers
—Freeland fire safety bounce house
—Millington Schools technology funds
—Saginaw Valley police K-9 unit equipment
—Vassar and Saginaw Food Pantries
—Children’s winter hats in Tuscola County
—Tuscola and Saginaw County 4-H Grants
—Food for local families in need
—Vassar Junior achievement class in finance
—Warm Blankets for woman and children
—Richland Township Community Pavilion
—Trolley Line Trail North Bike Path
and so many more!
For more information or for a Foundation
grant application, visit frankenmuthcu.org
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Mike Fassezke
appointed for 3 more years
Mike is employed by Star of
the West Milling Company
Tim Hildner
Tim owns
Hildner Design
and Contracting
Cheryl Loeffler
Cheryl is an attorney
employed by Frankenmuth
Insurance
Pete Bender
Pete is a Partner
at Yeo & Yeo, P.C.
Brian Dixon
Brian is a Partner and
Certified Public Accountant
(CPA) at Yeo & Yeo, P.C.
t r u s t
Richard Reif
appointed for 3 more years
Richard was employed at General
Motors for thirty-four years, and
as an electrician for 11 years
Ann DuRussel
Ann is a public accountant in
the dental profession and at a
local oil & propane company
Amy Zehnder Grossi
Amy is the General Manager
of Frankenmuth Bavarian Inn
Restaurant
Tiffany Lobodzinski
newly appointed for a
3-year term
Tiffany is employed by
Frankenmuth Insurance
as an underwriter
Brian Frederick
Thank you for your time
of Service.
Recently retired from
FCU Board
OUR MISSION: Growing trusted relationships by providing personalized financial solutions for our members and financial services that empower our communities.
OUR PROMISE TO OUR MEMBERS AND EACH OTHER:
I will treat you as an honored guest.
I will make it easy to do business with me.
I will identify your financial needs and offer a solution that will improve your financial life.
I will provide you with ‘extra mile’ service.
I will strive to deliver 100% accuracy.
I will treat you with the highest standards of professionalism.
I will address you by name.
I will thank you for your business.
FCU partners with local schools in Vassar,
Birch Run, Reese and Frankenmuth to offer an
educational experience like no other—a
real-world experience on how to run a
successful business. Frankenmuth Credit
Union’s student-run branches are coupled
most often with a business or finance class
where students are taught how to manage
the day-to-day operations of a Credit Union
Branch. Students are responsible for tellering,
marketing and promoting their branch and
staying within budget.
What’s better than a reality check on financing? How
about a reality fair that teaches students the skill of
budgeting and money management? FCU staff visited
St. Lorenz School in Frankenmuth and asked students
to choose a career complete with the income and
student loan debt that accompanied that profession.
The students then had to make life-style decisions
for housing, transportation, food, clothing, pets,
phone bills, etc. Participants left the event with an
appreciation for the everyday responsibility their
parents have when budgeting their own household.
Every Spring, FCU gives mini educator grants
to teachers in the communities we serve to
buy necessary supplies needed to enrich the
student’s learning experience.
Every year Frankenmuth Credit Union gives
seven $2,000 scholarships to FCU members
graduating from High School and pursuing a
higher-education degree.
For a scholarship application,
visit frankenmuthcu.org
15

KASASA CASH BACK ® Save more of everything — money, time, and energy — automatically with a free Kasasa Cash Back ® checking account.
Every time you use your debit card, you earn 1% back on your purchases, up to $10 a month! Saving is easy — that is, when you have an account that does
the heavy lifting for you. Do you Kasasa? ® For more information, visit frankenmuthcu.org or stop by your local FCU branch.
FCU APP Download our new app for the smartphone or tablet to give you all
the banking information you need right at your fingertips. The easy-to-use navigation
includes many mobile banking options, including: eDeposit, bill pay, loan calculators,
account details, account balance and more. Use the app to map FCU branch and ATM
locations, loan calculators, mobile banking and more. Download the Frankenmuth
Credit Union app from iTunes ® or Google Play ® .
v a l u e
NEW ON-LINE BILL PAY Save Time - Save Money - Enjoy Peace of Mind.
We are launching an all-new Bill Pay platform on February 25, 2016, within your It’s
Me 247 login. This updated service promises to save you time because it is quick and
easy to use. It will save you money because you no longer need stamps or have late
fees from forgotten bills you’ve misplaced. Get peace of mind knowing your bills can
be set-up to be paid when you want to pay them and for the amount you want to pay.
For more information on Bill Pay, visit our website frankenmuthcu.org or stop by your
local FCU branch.
NEW! PRETZEL DOUGH SHOPPING APP Save some dough when
you shop with the FCU’s new Pretzel Dough App. Now you can have access to upto-date
coupons from over 900+ national chain merchants and—coming soon—local
retailers too. The Pretzel Dough is a smart app that predicts shopping choices and
behavior for members by relying on relevant actions, geo-location and use. Download
the free Pretzel Dough app from iTunes ® or Google Play ® .
NEW VIRTUAL STRONGBOX Think of it as an online safe deposit box,
accessed directly from within your It’s Me 247 login. Conveniently save and share
important documents, such as wills, mortgages, tax and loan forms—all safely and
securely. All members get 10mb of free storage. To get started, visit our website
frankenmuthcu.org or stop by your local FCU branch.
KASASA® CASH CHECKING What’s better than free checking? Kasasa Cash ® is free checking that pays high rates each month. Plus, there is
no minimum balance. With Kasasa ® we will refund your ATM fees, nationwide*. This allows you to withdraw cash when you need it. No more searching for a
“free” ATM, when you’re on the road. Do you Kasasa ® ? For more information, visit frankenmuthcu.org or stop by your local FCU branch.
KASASA ® TUNES SAVER Turn up your free checking account with FCU Kasasa Tunes ® – free checking that rewards you with cash to spend
online! Just do simple things you do anyway, like use your debit card rather than write a check. Then, we will refund up to $10 iTunes ® , Google Play ® or
Amazon ® purchases each month – that’s a $10 minimum reward every month you qualify. Plus, we will refund your ATM fees, nationwide. Do you Kasasa ® ?
For more information, visit frankenmuthcu.org or stop by your local FCU branch.
Account approval, qualifications, limits and other requirements apply. See Frankenmuth Credit Union for details. iTunes® is a registered trademark of Apple Inc. and Amazon.com® is a registered
trademark of Amazon, Inc. Apple Inc. and Amazon, Inc. are not participants in or sponsors of this program. ATM fees incurred during qualification cycle will be reimbursed
up to $25 if qualifications are met within monthly qualification cycle. Limit 1 account per SSN.
Federally Insured by
17

V.I.P. REWARDS We value our members, the services they use and the balances they keep with FCU. Because of this, we offer the V.I.P. (Value In
Participation) Rewards program. Our V.I.P. Rewards Program reviews the amount of FCU products and services members use and assigns points for that
usage. The more services you use with Frankenmuth Credit Union the higher your level and reward. Lifetime points are your V.I.P. Rewards points that
accumulate from month to month. These points can be redeemed over time for merchandise, better rates, fee waivers and other service offerings.
In 2015 V.I.P Rewards paid $324,846 in loan interest rebates and $86,381 in higher CD dividend benefits! For more information on V.I.P. Rewards, email
ccenter@frankenmuthcu.org or stop by your local FCU branch.
o p p o r t u n i t i e s
SAVE TO WIN Save To Win is a 12-month CD that earns a competitive rate of return and only requires $25 at opening. Every time you deposit
to this CD, in $25 increments, you earn an entry into a monthly drawing where you could win cash rewards from $15 to $5000. Why gamble? With Save
To Win all of the money you deposit is still yours, you earn a great rate of return and you could win money! For a complete list of prizes and rules visit
frankenmuthcu.org.
DIAMOND CASH BACK
Frankenmuth Credit Union, your hometown financial solution, offers credit cards even better than the big
banks. Plus, your dollars stay local. Our Diamond MasterCard offers low rates, earns 1.5% Cash Back on all purchases, flexible repayment options, 24/7 fraud
monitoring and you can upload your own design for the card. For more information, visit frankenmuthcu.org or stop by your local FCU branch.
ID PROTECT | CELL PHONE COVERAGE Your identity protection is our highest priority. FCU members with consumer checking accounts
and their family will receive identity theft protection powered by IDProtect, for a low monthly security fee of $2. FCU members who qualify also receive up
to $10,000 in identity fraud expense reimbursement coverage for expenses associated with restoring your identity. Members who have ID Protect receive up
to $300 of coverage to reimburse the cost of replacing or repairing your eligible cell phones. This includes the primary line and up to two additional lines.
For more information, visit frankenmuthcu.org or stop by your local FCU branch.
NEW! APPLE PAY
FCU members with an iPhone ® 6 and the iPad
Air ® 2 and iPad mini ® 3 can now use their FCU
debit cards on Apple Pay. We call it pocket
charm. Apple Pay users no longer have to carry
their wallet, but will instead load their FCU debit
cards in to their Apple device. Users must have
an iTunes ® account and use either Wallet or
Passbook applications. For more information, visit
frankenmuthcu.org or applepay.com. Coming this
Fall, you will be able to upload your FCU credit
cards to Apple Pay.
NEW! CARD NAV APP
Manage and protect your debit card with ease.
Control how, when and where your debit card may
be used with CardNav. CardNav is rich with tools to
protect your card if it is lost or stolen. And, it shows
you balances and recent transactions - including
purchases, ATM withdrawals and even attempted
transactions. Establish controls on the merchants
you use, dollar limits and location of use. Download
the Free Card Nav app from itunes ® or Google Play ® .
Coming this Fall, you will be able to control your
FCU credit cards, too.
NEW! E-DEPOSIT
Deposit your paper check with this safe and secure
e-Deposit. e-Deposit allows you to make deposits to
your FCU account by taking a picture of your check
and filling out the JotForm with your account number
and account details. You can also use eDeposit to
send pictures of other items, like your picture ID or
loan documents. It’s as easy as point, click, deposit.
For more information, visit frankenmuthcu.org or
stop by your local FCU branch.
19

l o y a l t y
STEVE MASKER
—10 YEARS—
JENNY BICKEL
—25 YEARS—
CASSY NITZ
—10 YEARS—
DEBBIE BAUER
—25 YEARS—
LINDSAY KAUFMAN
—5 YEARS—
ANGIE ENGELHARDT
—20 YEARS—
SIERRA CHIESA
—5 YEARS—
SHERYL BILLS
—15 YEARS—
TIM CHRISTENSEN
—5 YEARS—
HOLLIE BRITTON
—10 YEARS—
HOPE POCKET Our commitment to our members goes beyond what FCU does as an organization. It lives in the
hearts...and pockets of our staff. It’s about ‘people helping people’ and we call it Hope Pocket.
CINDY RINESS
—5 YEARS—
Hope Pocket is a program created by staff to donate from each payroll to help our members when disaster strikes. Through
this initiative, we have provided clothes to families who have lost everything in a fire, delivered care-packages to families when
a loved one is in the hospital, refurbished a house for a family of five who were in a financial hardship, given backpacks filled
with school supplies to students in need, provided Thanksgiving dinners and so much more. FCU staff volunteers time through
initiatives such as our annual Rake and Run program (doing yard work for those physically unable). Staff also generously
donates their time to work at soup kitchens in Saginaw, Bay City & Flint every year.
First, let’s talk about probability. I’m sure you recall the highest-ever
Powerball jackpot of $1.5 Billion in January. I wouldn’t be surprised
that many of you, if not almost everyone reading this, purchased a ticket.
I know I did! What I don’t understand are the reports of some
individuals buying $100, $500, and even $5000 worth of tickets.
The odds are truly stacked against you no matter how many tickets
you buy. Each ticket was reported to have a 1 in 292 million chance
of winning. Keep in mind, the US population is somewhere in the
range of 320 million. Those are pretty poor odds, but why would we
do something we’re less likely to do than golfing two straight hole in
ones? The thought that someone has to win and dreaming it could
be you. I guess we can all keep on dreaming.
One of the few things less likely to happen than winning the
Powerball is also sports-related. The odds to pick a perfect March
Madness bracket are a staggering 1 in 128 Billion. Good Luck to all
of you vying for that perfect bracket this March!
Now, a little about volatility. While the stock market may look a little
scary right now, the long-term picture still remains positive. As oil
prices have continued to decline, gas prices have followed, which
translates to more money in your pocket. But what does that mean
for your 401(k) and other investments?
As stated in the referenced MFS piece, “Maintaining a long-term time
horizon and sticking to a disciplined, well diversified strategy may help
weather this volatility.” So the recommendation is to stay the course,
or even consider increasing your contributions. Bear markets may actually
be considered a buying opportunity as they have historically been much
shorter than bull markets. As the market cycle continues, this could be an
opportunity to buy on the cheap.
For those of you approaching or already in retirement, we tend to move
toward more conservative investments. The Member Investment Center
also offers a number of investment and insurance options that are not
invested in the market.
BUY LOW, SELL WHY?
No matter which category you fall into, you probably won’t be winning the
Volatility is inevitable. While historically bear markets have been relatively short, they can be
damaging. Maintaining lottery a anytime long-term soon. horizon and Instead, sticking to a disciplined, visit the well Member diversified Investment Center, we are
strategy may help weather this volatility.
here to help you plan for your future.
Historically, bull markets have been prolonged, while bear markets have been relatively short.
No matter what the market is doing or what the headlines read, don’t let your emotions drive your decisions.
Counter with a sound investment plan and a good financial coach. Whenever you have questions, concerns,
or ideas, talk and work with your advisor. He or she may best be able to help you pursue your long term goals.
100,000
10,000
1,000
100
10
4/28/42
5/29/46
128.7%
Bull-market gain
6/13/49
-24.0%
Bear-market drop
12/13/61
354.8%
6/26/62
-27.1%
2/9/66
85.7%
12/3/68
32.4%
10/7/66
-25.2%
5/26/70
-35.9%
1/11/73
66.6%
9/21/76
75.7%
12/6/74
-45.1%
2/28/78
-26.9%
4/27/81
38.0%
8/12/82
-24.1%
8/25/87
250.4%
10/19/87
-36.1%
7/16/90
72.5%
10/11/90
-21.2%
1/14/00
395.7%
3/19/02
29.1%
10/9/02
-31.5%
9/21/01
-29.7%
10/9/07
94.4%
3/9/09
-53.8%
1940 1950 1960 1970 1980 1990 2000 2010 2015
Source: MFS.
Returns are shown based on price only.
The Dow Jones Industrial Average (DJIA) measures the US stock market.
Past performance is no guarantee of future results.
NOT FDIC INSURED • MAY LOSE VALUE • NO BANK GUARANTEE
3/31/15
171.5%
so far
Comments concerning past performance are not intended to be forward looking and should not
be viewed as an indication of future results. Past performance does not indicate future results.
Diversification does not ensure a profit or guarantee against loss; it is a method used to manage risk.
Representatives are registered and securities are offered through Sigma Financial Corporation, member
FINRA/SIPC, 300 Parkland Plaza, Ann Arbor, MI 48103. Non-deposit investment products are not
federally insured, involve investment risk, may lose value, and are not obligations of or guaranteed
by the credit union. Member Investment Center and Frankenmuth Credit Union are not affiliated with
Sigma Financial Corporation. Member Investment Center mailing address is 580 N. Main St., PO Box
209, Frankenmuth, MI 48734.
1.“Buy Low, Sell Why?” MFS Fund Distributors, Inc, Boston, MA. Web. May 2015.
See other side for important information.
11

a c c u r a c y
Board Members present: Pete Bender, Brian Dixon, Brian Frederick, Amy
Zehnder-Grossi, Ann DuRussel, Cheryl Loeffler, Rich Reif, Mike Fassezke, and
Tim Hildner.
Others present: Vickie Schmitzer, Dana Reif, Kari Schmitzer, Joanne Frederick,
Jeff Schmitzer, Danika Schmitzer, Doug Anderson, Hollie Britton, and Janet Reif.
The meeting was called to order at 6:02pm by Chairman of the Board Pete
Bender. Rich Reif presented the Secretary’s report. A motion was made to
approve 2014’s annual meeting minutes as presented by Brian Frederick,
supported by Brian Dixon. Motion carried. Brian Dixon gave the Treasurer’s
Report, found on page 9 of the 2015 Hometown Times. A motion was made by
Tim Hildner, supported by Rich Reif to approve as presented. Motion carried.
Hollie Britton delivered the Credit Committee report, found on page 8 of the
2015 Hometown Times. A motion was made by Rich Reif and supported by
Ann DuRussel to approve report as presented. Motion carried. Brian Dixon
presented the audit report, found on page 8 of the 2015 Hometown Times.
A motion was made by Brian Frederick, supported by Amy Zehnder-Grossi to
approve as presented. Motion carried.
By-Law changes were reviewed by Dana Reif. The first change was on the
expanded Field of Membership (statewide) wording. Another change was
wording that was removed due to a contradiction to the Credit Union Act.
February 3, 2016
Board of Directors
Frankenmuth Credit Union
Frankenmuth, Michigan
At your request, we have completed the Comprehensive Annual Audit of
Frankenmuth Credit Union for the years ended December 31, 2015 and
December 31, 2014.
Our examination of the Statements of Financial Condition, Statements of
Income, Comprehensive Income, Changes in Members’ Equity, and Cash Flows
was conducted in accordance with auditing standards generally accepted in
the United States of America. Our full report, which includes an unmodified
opinion of the financial statements,
Sincerely,
has been submitted to the
Board of Directors.
Cindrich, Mahalak & Co., P.C.
The third was adding Bethel’s field of membership into ours. A motion was
made to approve as presented by Brian Dixon, supported by Rich Reif. Motion
carried.
Old Business - None. New Business – None.
Vickie Schmitzer presented the CEO report. Welcome C. Douglas Anderson,
our former Board member. Thank you for your service. We are celebrating
our 50th anniversary this year. 2014 was a year of growth. We opened
a new branch in Cass City in 2014, and we are looking to open a satellite
branch in 2015 in the Rockford area. Bethel AME CU joined us in 2014 as
well. We purchased and have an agreement to sell the 111 N. Main Street
property in 2014, which turned into a win-win for our community. The
Main office renovation is scheduled to be done in fall of 2015. There was an
announcement of a new formation of a CUSO, owned by Frankenmuth Credit
Union and Emil Rummel Agency that will offer insurance services to members.
Thanks to our dedicated staff, engaged and educated Board members, spouses,
and our members.
Nominating Committee – Tim Hildner – There were no others running for
office, so the 3 incumbents will continue to serve another term and they are
Amy Zehnder-Grossi, Brian Frederick, and Cheryl Loeffler.
A motion was made by Mike Fassezke and supported by Cheryl Loeffler to
adjourn at 6:17pm. Motion carried.
The Credit Committee is an employee group of Loan Officers. They meet every
day to approve or deny loan requests. These requests are outside of the lending
authority of individual Loan Officers.
During 2015, we processed 7,697 loans totaling $118,134,890.40.
Have you heard about our new Diamond Cashback MasterCard? It offers a
competitive rate AND members earn 1.5% Cashback on all purchases. The
Diamond MasterCard also offers a flexible repayment option, no fee for cash
advances or balance transfers, 24/7 fraud monitoring, and you can create your
own custom card. Stop in to one of our branches or apply online today.
Respectfully submitted,
FCU Credit Committee
Frankenmuth Credit Union
had a financially successful
year in 2015. There was
growth in loans to our
members and increases in
deposits from our members.
Services that our members
use and electronic delivery
channels also grew. Assets
increased to just over $410
million which was a 19%
increase in just one year.
What an accomplishment!
In reviewing the Income
Statement, FCU had strong
earnings coming from
loan income, income from
operations and income from
investments. Overall return
for the credit union was
in excess of $6 million of
earnings. This includes the
sale of the Frankenmuth bank
building that was purchased
for use during the Main Office
remodeling project. This
return also includes the annual
deposit to the Frankenmuth
Community Foundation for
our Communities. This year
$250,000 was set aside for
this worthy cause. What a
privilege for the credit union
to be able to reinvest dollars
of this magnitude back to the
communities we so proudly
serve.
13