Navigant Credit Union Annual Report 2016

Looking Ahead

This is my last letter as your Chairman. It is now time for someone new to have this privilege. I have so many people to thank, starting with the members of Navigant Credit Union. I have been honored to serve as your Chairman. It has been an enjoyable and rewarding experience. I look forward to continuing to serve you as a member of the Board of Directors. I would also like to say thank you to our employees for their dedication and hard work in providing the exemplary service that is the foundation of what makes Navigant Credit Union great. To the management team, thank you for your leadership. It drives our success. To my fellow directors and committee members, thank you for your expertise and governance. I am reminded that Navigant Credit Union’s award of the #1 Best Place to Work in RI by Providence Business News for the 2nd year in a row proudly depicts the essence of Navigant Credit Union.

Joe

A Letter From Our ChairmanJoseph R. Beretta 2016 was the first year of the “Next 100” campaign. We launched the “Next 100” campaign while celebrating our 100th Anniversary in the previous year. The campaign is about focusing on the future and continuing to improve the financial lives of our members and our communities. Navigant Credit Union believes that giving back to the community is one of the keys to its success. In 2016 we continued our community support not only financially, but also with our employee V-Force volunteer teams. With the addition of two new branch locations in Scituate and North Smithfield, Navigant Credit Union remained committed to profitable growth while staying true to the Credit Union’s roots of community involvement. In 2016, we also embarked on a new strategic initiative centered on the Member Experience. Our focus on the member experience is how we set ourselves apart in a very competitive, financial services marketplace.

The theme of this year’s annual report is “Looking Ahead”. We are excited about what lies ahead, because we have built a solid foundation that enables the Credit Union to embrace changing technology and meet the needs of members. In an increasingly complex financial environment that demands innovation and increased convenience, Navigant Credit Union will continue to focus on adding value in all interactions with members, whether in person or virtually. Our commitment to technology demonstrates our willingness to ensure members receive the maximum benefit from their banking relationship. For example, we are very excited to announce that Navigant Credit Union will be launching a new website very soon. The new website will be helpful and easy to use. It will include a variety of mobile app functionalities for both consumer and business members and tutorials to explain digital and other services. The Credit Union is always working hard to provide the very best products and services.

Financially, the Credit Union had another strong year. We see the optimism in the leadership of our State and the economic direction they are pursuing. The Credit Union will continue to do its part to move Rhode Island forward. Whether its community participation, home financing, or financial education, we will continue our efforts to keep Rhode Island a great place to live and work. We will all enjoy the benefits of a vibrant economy. As an indicator of the positive momentum of the economy, the Credit Union has experienced significant growth in deposits and loans and financial results exceeded expectations. More members took advantage of investment services with NCU Financial and our commitment to the community grew in both volunteer hours and funds donated. We have once again made the Credit Union stronger with an increase in its capital position. Our management team is deliberate and prudent in their management of the Credit Union. They focus on the best interest of the members while generating profitable growth. I am delighted to report that the Board of Directors has once again declared a bonus dividend. I believe this is an important way we provide value to our members.

1 2

3

News as the # 1 Best Place to Work in RI in the large employer category for the second straight year. What makes this award special is that it is given based on the input of every employee at Navigant Credit Union. It is their commitment to our members and the communities in which we serve that makes us proud. Our employees think we are the best place to work and as one of their co-workers, I couldn’t agree more.

On a sad note, this past fall we lost a man who embodied the spirit of Navigant Credit Union. Maurice Rhault was 93 years young and served on the Credit Committee for 60 years, the longest tenure of any committee or Board member in the history of Navigant Credit Union. His unexpected passing gave us a moment to reflect on the life and career of this great man. Upon his retirement Maurice said to us “Count your life by smiles not tears: Count your age by miles not years.” He was a good friend and he will be missed.

The theme of this year’s Annual Report is “Looking Ahead.” As we consider the future, the question is often asked, what is the key to Navigant Credit Union’s continued success? I think that managed growth is the key to the Credit Union’s continued success. Carefully evaluating new market opportunities and strategic alliances to expand our convenient access to more members; deliberately evaluating and adding new technology to meet the changing ways members want to access our products and services; and generously give our time, talent and treasure to make our communities a better place, are all fundamental to our future success. I often say that if we treat our members and employees as family and the community as an extension of that family, our success will be a natural result of that effort. With all this in place, it is my promise to you that we will continue to focus on our strategic priorities as we aim to deliver value at every member interaction while driving growth. We look forward to 2017 and the opportunities that lie ahead. Thank you for your continued confidence in us.

Gary

A Letter From Our CEOGary E. Furtado Success has many definitions. One of the ways we define success is meeting the needs of our members. If members find value in their interactions with Navigant Credit Union and are willing to recommend us to their friends and family, then we are successful. We also measure success by the strength of our financial position. 2016 was an outstanding year on both counts. I am proud to be part of a team dedicated to the success of our members, the success of the community, the success of each other and, ultimately, the success of Navigant Credit Union.

Navigant Credit Union welcomed over 12,000 new members in 2016. With these members came deposit growth and new relationships that denote Navigant Credit Union as their primary financial institution. We also had an excellent year in lending. For the first time in a long time, home purchase mortgages exceeded re-finances. Home sales are a good barometer of the improved housing market. First time home buyers entered the market in force this year and many took advantage of Navigant Credit Union’s First Time Home Buyer Program. We are proud to do our part of making the dream of homeownership a reality. In line with the state of Rhode Island’s focus on economic development, our Commercial Lending team worked with businesses to provide the capital and banking relationships needed to grow their business.

2016 also marked an exciting year in branch expansion. In June, we successfully opened a newly constructed branch in the Slatersville area of North Smithfield. We are very pleased with the results and welcome we have received in North Smithfield. We also welcomed the members of the former Dexter Credit Union to the Navigant Credit Union family, and we now have a branch and new friends in Scituate, Rhode Island.

At Navigant Credit Union, we believe what sets us apart from your banking alternatives is the personal, caring and responsive service we strive to provide. In order to see how we are doing on the member experience, we took time to solicit honest feedback from our members. In July and August we conducted a Member Experience Survey. Thank you to the more than 3,000 members who took the time to complete the survey and provide valuable information. As expected, we received both good feedback and opportunities for improvement. Over 80% of our members are very satisfied! Our organization has made a commitment to continuously improve the member experience. As a result of the feedback we received from the survey, we have an action plan to address the top priorities that will result in noticeable improvements over the next few months.

We also learned from the Member Experience Survey that one of the reasons why members think Navigant Credit Union is the best is because we have great people. To that point, we were once again honored by the Providence Business

4

Supervisory Committee

Credit Committee

5

Board of Directors

Senior Management

Board of Directors

Dr. Peter E. BaziotisJames K. SalomeRoland R. LachapelleCPA,Vice ChairmanPaul A. BeaudoinJoseph R. BerettaChairmanAlfred P. DegenPast ChairmanGary E. FurtadoPresident/CEO/TreasurerCharles H. DeBlois Jr.Past ChairmanAnn M. KashmanianCPA, SecretaryRobert J. MurrayCPAMichael F. Ryan

Senior Management

H. Chris Der VartanianSVP/CROLisa G. DandeneauEVP/COO Daniel J. O’BrienSVP/CFOKathleen C. OrovitzSVP/CRBOKenneth L. SenusSVP/CIOGary E. FurtadoPresident/CEO

Supervisory Committee

Jean M. RyanCPA, ChairwomanClaire O’RourkeCPAStephen Cross

CPA

Credit Committee

Lisa G. DandeneauEVP/COODonald R. ChevretteChairman

Officers

Joseph AnthonyAVP/Branch ManagerKathleen AntonelliVP Electronic ServicesJane ArthurAVP/System Security AnalystKaren BalchVP/Regional Branch ManagerBryan BaptisteAVP/Branch ManagerJoanne BazVP/Regional Branch ManagerKelli BowersAVP/Accounting ManagerSandra CanoAVP/Community DevelopmentJeffrey CascioneVP Commercial LendingMartha CorreiaVP/Regional Branch ManagerPatricia CrossVP Retail OperationsLisa DandeneauEVP/COODavid DecubellisVP Residential Mortgage LendingH. Chris Der VartanianSVP/CROMaria DiasAVP/Branch ManagerMarc DionneVP ComplianceJames DrakeAVP/Facilities Timothy DraperVP MarketingRichard ErricolaAVP/Loan Workout OfficerJudy FischbachVP ControllerGary FurtadoPresident & CEOJessica GoncalvesAVP/Branch ManagerTheresa GormleyVP/Loan ServicingMargaret Gidget GriversAVP/Branch ManagerScott HammondVP Network OperationsTiffany JoyalAVP/Call Center Manager

Pamela LaBrecheAVP/Relationship ManagerEliza LavergneVP/Project ManagementBruce LavineVP ATM Apps Systems/IT DPJeffrey LemosVP/Human ResourcesStephen LoporchioAVP/Relationship ManagerMary MaloneyVP/ALMKathleen MarabelloVP/Regional Branch ManagerIria MogayzelAVP/Branch ManagerMonique MorissetteAVP/Information Security OfficerCynthia MorraAVP/Branch ManagerDaniel O’BrienSVP/CFOStephen OrmerodVP/Chief Security OfficerKathleen OrovitzSVP/CRBODonald OsleyAVP/Relationship ManagerJonathan RobertsVP/Business AnalyticsChristopher SabbaghAVP/Branch ManagerRandall SacilottoVP Community DevelopmentKenneth SenusSVP/CIORoss SilvaAVP/Business Dev & Regional Loan OfficerFred SmithAVP/Business Relationship ManagerMichael TartagliaVP/CollectionsEileen TweedieAVP/Private BankerRobert VillucciVP Consumer LendingNancy WilsonAVP/Human ResourcesDonna WoodAVP/Training & Development

Best Place to Work 2016

Navigant Credit Union Employees

American Heart Association

Navigant Credit Union employees show their support of the American Heart Association by wearing red.

#DStrong

Navigant Credit Union employees showing their support for Dorian Murray with the worldwide hashtag (#DStrong) to bring awareness to pediatric cancer.

Steve G Walk

On October 15, 2016, over 200 Navigant Credit Union employees, friends and supporters participated in the 9th annual Providence “Free to Breathe” 5K Run/Walk held at Roger Williams Park. The participants did the walk/run in honor of a fellow Navigant Credit Union employee, the late Stephen Giannini.

Annual Employee Meeting

Our NAVCAR champions from the mortgage lending team posing at the pitstop challenge from our Nascar-themed employee meeting in March.

Best Place to Work 2016

Throughout 2016, Gary Furtado, President/CEO made it a point to say that our successes are a direct result of our dedicated employees. In May, as proof of this, and with the votes from employees, Navigant Credit Union was named Best Place to Work in the “large employer” category by Providence Business News for the 2nd year in a row.

8

Steve G Walk

Annual Employee Meeting

American Heart Association

7

#DStrong

6

In Memory of Maurice RhaultNov 6, 1922 - October 13, 2016 (age 93)

The year 2016 saw the unexpected loss of a good friend, the longest serving member of the Board of Directors and Credit Committee, Maurice Rhault. Having recently retired, Maurice had been part of Navigant Credit Union since 1956. He was appointed to the Credit Committee in that year and was an active member of the Committee until he retired in 2016 . Mr. Rhault’s commitment to Navigant Credit Union was beyond exceptional. He had seen good and bad economic times, and observed many ups and downs in the housing market. Through it all he helped the Credit Union to make smart lending decisions that were not only in the best interest of the Credit Union, but in the best interest of the members. Mr. Rhault was a distinguished gentleman who had a kind word for anyone he met. At his last Board meeting he said something we should all live by: “Count your life by smiles, not tears; Count your age by miles, not years.” We thank him for all he has done. He will surely be missed.

Little Sisters of the Poor

9 10

Navigant Credit Union In the Community

Scholarships

For the 17th consecutive year, Navigant Credit Union awarded ten $1,000 scholarships to graduating seniors from area high schools.

Little Sisters of the Poor

This past October, Gary E. Furtado, President/CEO, received the Outstanding Service Award from the Little Sisters of the Poor. He was honored for his commitment to supporting the Little Sisters home in Pawtucket. The Baby Boomer Bash event was held at the Crowne Plaza Hotel in Warwick.

NeighborWorks Blackstone River Valley

Navigant Credit Union partnered with NeighborWorks to support families in building their homes. Pictured is Lisa Dandeneau, EVP/COO, at the Fernwood ribbon cutting ceremony.

PACE

The PACE Organization of Rhode Island’s Ribbon Cutting Ceremony was held in April 2016. Navigant Credit Union is proud to support this great organization that enables eligible seniors to remain in their own communities rather than be placed in long-term care facilities.

Financial Education Recognition

We were honored at the 2nd Annual Innovation in Financial Education Awards presented by Nasdaq and EverFi. The award recognizes significant efforts to improve the financial capability of Americans through unique digital learning initiatives. Thirty-five institutions were honored with this distinction at a ceremony hosted on April 6th at Nasdaq MarketSite in New York City.

PACE

Financial Education Recognition

NeighborWorks

Scholarships

Statement of Financial ConditionASSETS

2015Cash & Short-Term Investments $ 64,138,731

Investments U.S. Government Obligations 94,453,120 Corporate Bonds and Notes 76,796,045 Other Investments 4,344,195

Total Investments 175,593,360

Loans to Members (Net of Allowances) Consumer Loans 100,912,153 Member Business Loans 174,792,343 Residential Mortgage Loans 752,525,265 Equity Loans 239,867,553

Total Loans to Members 1,268,097,314

Property and Equipment (Net Accumulated Depreciation) 27,367,279 Other Assets 47,169,783

Total Assets $ 1,582,366,467

LIABILITIES AND SURPLUS

Deposits Shares & Money Market Accounts $ 484,265,486 Time Deposits 445,476,638 Demand Deposits 286,998,149 Other Deposits 2,152,494

Total Deposits 1,218,892,767

Borrowings 160,577,384

Accrued Interest on Deposits and Borrowings 977,750

Other Liabilities 20,680,010

Total Liabilities 1,401,127,911

Members Equity Regular Reserve 26,854,241 Accumulated Other Comprehensive Income (Loss) (6,283,838) Undivided Surplus 160,668,153

Total Members Equity 181,238,556

Total Liabilities and Members Equity $ 1,582,366,467

11 12

Slatersville Branch Slatersville Employees with Patriots player, James Develin

Scituate & Slatersville New BranchesIn 2016, Navigant Credit Union added two additional branches to its 13-branch network. Our Scituate branch was the result of a merger between Navigant Credit Union and Dexter Credit Union. Our Slatersville branch is an exciting opportunity for new growth in North Smithfield. We are proud to be part of these communities and look forward to long-standing relationships with our new members.

Slatersville Branch925 Victory Highway, North Smithfield, RIScituate Branch135 Danielson Pike, Scituate, RI

Scituate Branch

2016$ 82,687,634

106,063,68887,756,731

2,425,255

196,245,674

148,869,660191,022,020825,559,824268,347,526

1,433,799,030

31,783,214

47,080,780

$ 1,791,596,332

$ 561,939,593497,237,482335,280,127

2,699,776

1,397,156,978

174,676,242

660,171

24,412,305

1,596,905,696

26,854,241(7,084,784)

174,921,179

194,690,636

$ 1,791,596,332

401.233.4700 • navigantcu.org

Federally insured by the National Credit Union Administration