2017Annual Report

its regulatory capital to asset ratio at 10.75%, as of December 31, 2017. This ratio is well above the regulatory threshold of 7% established by the NCUA and is the benchmark for a well-capitalized credit union.

As we look to the future, I want to assure you that Dutch Point Credit Union is financially healthy and ready to take on the challenges that lie ahead. We will continue to offer new product features and services which will afford the entire membership greater benefits for the future.

We want to thank you, our member owners, for your continued support. We truly appreciate and value your loyalty to Dutch Point Credit Union.

Respectfully submitted,

August L. DeFranceTreasurer

The financial results for 2017 marked another successful year for Dutch Point Credit Union. Our solid performance can be attributed to the continued overall strength of the credit union’s assets, members’ use of credit union products and services, and the improved economy.

As of December 31, 2017, credit union assets were $300.420 million, which is a 5.6% increase from 2016. This growth corresponded with a 5.3% increase in member share deposits. Net Income for 2017 was $2.228 million, representing a Return on Assets (ROA) of approximately .75%. As a not-for-profit cooperative, the income we earn allows us to give back to our members by way of competitive rates on both loan and savings products.

Our loan portfolio performed well in 2017, growing nearly 9% for the year. As of year-end, the loan portfolio reached $148.569 million. Member demand for auto loans was strong and the mortgage loan refinance and purchase market continued to be robust as interest rates remained low. Additionally, demand for Home Equity Line of Credit (HELOC) loans was strong due to a special rate promotion we provided throughout the year.

The quality of the credit union’s assets remains high. This is based on the most recent State of Connecticut Department of Banking examination, which measures the safety and soundness of your credit union. Dutch Point Credit Union is proud to continue to demonstrate financial strength with

Dutch Point Credit Union’s Supervisory Committee is appointed by your Board of Directors and is responsible for assuring the financial strength of the credit union through sound financial discipline.

The Committee oversees a variety of audits and reviews to ensure compliance with state and federal regulations, credit union by-laws, and generally accepted accounting principles (GAAP). In addition, the Committee supervises an annual exter-nal audit of the financial records of the credit union, verifies mem-ber accounts, and reports the results to the Board of Directors. The Certified Public Accounting firm of Doeren Mayhew CPAs and Advisors has been retained to perform a financial state-ment audit as of December 31, 2017.

2017 Supervisory Committee Report

2017 Treasurer’s Report

It is the belief of the Supervisory Committee that Dutch Point Credit Union is financially solid and is being operated in a safe and sound manner. The Committee appreciates your continued confidence in our oversight role. The support and cooperation of the Board of Directors, management, and employees has assisted us in the performance of our duties and is greatly appreciated.

Respectfully submitted,

Steven W. Miller Chairman

In 2017, we continued on our path of growth. In order to achieve this we must constantly find the balance in delivering member value, maintaining our financial strength and investing for the future – your future. On behalf of your Board of Directors we are pleased to say that, once again, your credit union had another successful year.

It’s important for financial institutions to grow as a means of staying competitive within the industry. In 2017, we were no exception; Dutch Point, for the first time in its 57-year history, saw total assets reach a new milestone of $300 million. Additionally, we saw total loans outstanding to members reach nearly $150 million. What’s important is that our members put their trust in us when saving and when they need a loan. When members borrow from the credit union, they are helping other members – because borrowing from the credit union enables us to pay higher dividends on savings and offer lower rates on loans. It also allows us to invest in new technologies for the future.

While growth is paramount, so is financial strength! In 2017, Dutch Point was once again recognized by Bauer Financial, one of the nation’s leading independent bank rating firms, as a 5-Star

rated institution. This represents the highest level of banking performance and we are very proud of this accomplishment.

Lending is the reason for our existence and an important part of our business. However, to be effective, we need to offer lending products that meet your everyday needs. For example, in our last member survey one of your challenges was the rising costs to attend college. As a result, we implemented a private student loan program. We value member feedback and requests and we can promise you that as we move forward, we will continue to offer lending products that fit your lifestyle.

Our commitment as a Connecticut community credit union is to be involved in charitable giving and community outreach. In 2017, we dedicated a loan promotion to a community cause. For each loan made, we donated $5.00 to the Connecticut Children’s Medical Center Foundation. The funds raised were used to purchase IPads for the students of the CCMC School in New Britain. Today, more than ever social responsibility is important to everyone. Both members and staff were key in our efforts to support these organizations in 2017: Making Strides Against Breast Cancer Walk, Special Olympics, Operation Fuel, the American Red Cross, and Hurricane Relief efforts, to name a few. We are proud of our staff and member involvement which makes these efforts possible.

As technology evolves, we are finding better and more innovative ways to bring new services to you. Our plans for 2018 include the addition of Samsung Pay and Google Pay to our mobile suite, enhanced email/text messaging alerts on your credit and debit cards to better prevent fraud, and a new simplified online loan application that will be flexible, making applying for your next loan effortless. We have also established a 3-year plan to replace a number of our older ATMs at our branches.

We couldn’t do what we do without you, our members; you are the reason for our success. On behalf of the Board of Directors, management, and staff, we thank you for your commitment and loyalty to Dutch Point. We will work hard each and every day to earn your continued trust.

2017 Membership Report

Respectfully submitted,

Richard S. Zajack Francis R.N. ProtoChairman of the Board President and CEO

Pictured left to right are: Patricia Fitzgerald, PhD, CCMC School Clinical Director, Patricia L. Gerrity, CCMC School Principal, Michael Kern, PhD, CCMC School Clinical Coordinator, Gwen Killheffer, CCMC School Assistant Principal, Gary Lenoce, CCMC School Assistant Principal, Elizabeth Mumford, Dutch Point Credit Union Vice Pres-ident Marketing/PR, Anthony Sacchetti, Dutch Point Credit Union Chief Member Experience Officer, and Francis Proto, Dutch Point Credit Union President and CEO.

Dutch Point presents a second donation to the CCMC School in New Britain. The total 2017 donation to the school was $9,400.

LIABILITIES: Members’ share and savings accounts $265,131,655 $251,765,852 Accounts payable and accrued liabilities 1,490,469 1,846,288 Total liabilities 266,622,124 253,612,141

Commitments and contingent liabilities -- --

MEMBERS’ EQUITY: Regular reserve 4,104,788 4,104,788 Undivided earnings 26,335,270 24,106,983 Equity acquired through merger 2,836,060 2,836,060 Accumulated other comprehensive (loss) 521,304 (158,185) Total members’ equity 33,797,422 30,889,646 Total liabilities and members’ equity $300,419,546 $284,501,787

Cash $ 1,692,295 $ 1,769,235

Investments: Available-for-sale 6,418,037 5,373,991 Held-to-maturity 81,527,282 72,613,333 Other 54,694,779 60,672,291

Loans to members, net of allowance for loan loss 148,568,926 136,668,310

Accrued interest receivable Loans 413,965 343,766 Investments 304,731 212,056Property and equipment 2,520,760 2,733,366Prepaid and other assets 1,670,098 1,655,333NCUSIF insurance deposit 2,608,673 2,460,106

Total assets $300,419,546 $284,501,787

Statement of Financial ConditionAssets

As of December 31, 2017 2016

The financial statements presented above are unaudited as of the publication date of the Annual Report.

Liabilities and Members’ Equity

2017 Financials

As of December 31, 2017 2016

INTEREST INCOME: Loans to members $ 6,717,180 $ 6,092,948 Investments 2,022,199 1,402,413 Total interest income 8,739,379 7,495,361 INTEREST EXPENSE: Members’ share and savings accounts 836,947 665,542 Net interest income 7,902,432 6,829,819

PROVISION FOR LOAN LOSSES: 440,670 36,882 Net interest income after provision for loan losses 7,461,762 6,792,937

NON-INTEREST INCOME: Fees and service charges 3,863,042 3,505,994 Gain from bargain purchase - merger -- 456,658 Total non-interest income 3,863,042 3,962,652 11,324,804 10,755,589 NON-INTEREST EXPENSE: Compensation and employee benefits 4,504,428 4,146,682 Office operating costs 3,613,300 3,483,153 Other 978,789 1,026,607 Total non-interest expense 9,096,517 8,656,442

Net income $ 2,228,287 $ 2,099,147

Statement of Income

For the years ended December 31, 2017 2016

2017 2016 % Growth

Total Assets $300.420 M $284.502 M 5.6%

Member Shares $265.132 M $251.766 M 5.3%

Member Loans $148.569 M $136.668 M 8.7%

M = Millions

Key Measurements

Richard S. Zajack, ChairmanJohn L. Gombotz, Vice-ChairmanAugust L. DeFrance, TreasurerFrancis R.N. Proto, SecretaryRobert E. DeRoehn, Assistant TreasurerMichael E. Curtin, DirectorRoland Deslippe, DirectorSteven W. Miller, DirectorTimothy Tuell, Director

Steven W. Miller, ChairmanNoel Aube MemberMarguerite Rose, Member

Francis R.N. Proto, President and CEOCharlyn Tanner, Executive Vice President and CFOAnthony Sacchetti, Chief Member Experience Officer

Board of Directors

Supervisory Committee

Marguerite Rose, ChairpersonNoel Aube, MemberRoland Deslippe, Member

Nominating Committee

Credit Union Executive Officers

Board of Directors, Committee Members and Executive Officers

Branch Locations

Wethersfield195 Silas Deane HighwayWethersfield, CT 06109(main office)

Newington465 Willard Avenue Newington, CT 06111

Niantic8 West Main Street Niantic, CT 06357 Bloomfield1 Wintonbury MallBloomfield, CT 06002

West Hartford50 South Main Street (Town Hall)West Hartford, CT 06107

Berlin107 Selden StreetBerlin, CT 06037 Middletown213 Court Street, Suite 101Middletown, CT 06457

MillstoneRope Ferry RoadWaterford, CT 06385(restricted access)

Stars In Your Community

Dutch Point is the main sponsor of the 2017 Literacy Volunteers of Central CT Scrabble Tournament.

Standing - Laurie Mornhineway teaches financial literacy for the Wethersfield Family Learning Program.

Popular with our members is Popcorn Friday at our Wethersfield branch. Dutch Point holds another community shred day in 2017 at the Wethersfield branch.

The Dutch Point Credit Union Crusaders walked in the Making Strides Against Breast Cancer Walk in Hartford. Team Dutch Point has sixteen energized “Crusaders.”