the DIFFERENCE

2016 Annual Report

DISCOVER

WEPCO Federal Credit Union held its 66th Annual Membership Meeting on Saturday, March 5, 2016 at 6:00 PM in the Barton Fire Hall of Barton, Maryland. The evening began with Pastor Kenneth Caplinger of the Ebenezer – Springfield Charge, in Sunrise Summit, Romney and Springfield, WV, giving the invocation. A chicken breast dinner was then served.

After the meal, Mark Alexander, Chairman, came forward and introduced the management, staff, directors, and guests present. He recognized John Pattison, Charter Member; former Directors: Glenn Shaffer and his wife, Nancy; Bob Alkire and his wife, Marion; Bill McKenzie and his wife, Tootie; Boots, wife of deceased Director Frank Woy; and former member employee Betty Smith.

Tonya Smiley came forward and introduced the entertainment for the evening: Donnie Carmen. He played various songs ranging from Elvis Presley’s “Blue Suede Shoes” to the famous gospel song “I’ll Fly Away.” He kept the guests engaged and entertained!

Becky McKenzie came forward and addressed the membership. Becky stated “New processes to enhance member service were developed and implemented in 2015 and helped to set our five year strategic goals to grow your credit union.” In addition, she stated “I am pleased to share that based upon preliminary conversations with the (NCUA) examiner in charge, there were no troubling concerns with any areas of risk.” She ended with “Our future is bright and I am grateful that you have chosen WEPCO to be your financial institution of choice!”

Mark Alexander, Board Chairman, conducted the business meeting. He requested Jeff Conner of Fike, Conner and Associates to come forward and address the membership. Jeff stated, “Unlike NCUA, which audits risk, Fike, Connor & Associates audit WEPCO’s financial statements. WEPCO had $15 million in loan growth and reached $200 million in assets in 2015. Management has invested a lot in technology to help WEPCO achieve its future goals.” Mark also commended former board directors present for their part in helping WEPCO succeed. The Annual Report was accepted as written. Mark asked Becky McKenzie and Michelle McElwain to come forward and present service awards. They presented awards to Nicole Moore, Member Service Loan Officer, for 5 years of service; and Michelle McElwain, Senior VP, for 15 years of service. In addition, the following employee not present will receive a service award: Jenny Shingler, Bloomington MSR, for 15 years of service.

Finally, Tonya asked for Diana Dayton, Ashley DiUbaldo, Brandy Roderick and Pastor Caplinger to come forward to help with the door prizes. She requested that Pastor Caplinger pull the door prize tickets. Carol Bland won the Grand Prize of a $500 VISA Gift Card; Kim Gattens and Delores Poland won $100 gift cards; and John Ours, Megan Machin, Rachael Dayton, Mary Crable, Louise Pfeifer, Scott Whetsell, Bob Poland and Donald Beeman all won $25 gift cards. The meeting ended at 8:00 PM with Pastor Caplinger giving the benediction.

Respectfully submitted,Diana Dayton, Secretary

66th Annual Meeting Minutes

In the age of mobile technology, WEPCO understands that convenience on the go makes all the difference for our members. Thus, we are taking on a huge project to enhance our online and mobile banking platform by expanding the services we can offer!

• Mobile Bill Payer. You will soon be able to pay your bills wherever you are.• Mobile Check Deposit. You will take a picture of the front and back of your check and upload it for deposit.• Mobile Loan and Account Applications. You will be able to apply for loans or accounts through our mobile app.

We are also researching into making several of our current services mobile, such as check images, eStatements, account alerts, and skip-a-pay.

WEPCO will continue its outreach to support our local communities. In addition to Relay for Life and donations to charitable organizations, we will hold our 27th Annual Scholarship Contest, our Member Appreciation Day on Tuesday, April 25th, and our Kids Day on Tuesday, July 18Th. Make sure to mark the dates and celebrate with us!

Robert Alkire 1927- 2016

We would like to dedicate this year’s annual report to Robert “Bob” Alkire, former director, for his many years of service to WEPCO Federal Credit Union..

Bob volunteered as a board director with WEPCO from 1981-2011. He served our members for 30 years! Words can simply not express what an amazing person Bob was and how much he meant to us! His contributions and service helped us to grow and continue to be successful. He will be greatly missed and never forgotten.

2016 Year at a Glance

To discover the difference of what makes WEPCO great, we started with our employees. We realize that the better they are prepared, the better the member service, and everyone will see the difference between WEPCO and the “other guys!” So, we introduced an Intranet, a private network only accessible by our employees. This invaluable tool helped us better educate and support our staff so they can help you quickly and easily! As a result, our employees handled your requests with the care and attentiveness that separates WEPCO from other financial institutions! WEPCO recognized employees who excelled in their continuing education through our training platform, BVS, and our Employee of the Quarter program. We also started a new education program that teaches them best practices on protecting sensitive information. As a result, our staff treat your information with the utmost care and privacy you deserve! For you, we added Adjustable Rate Mortgages (ARM) to our product offerings! ARMs can make

the difference for members with an initial rate that is lower than our conventional mortgages. ARMs make great financial sense for certain homeowners and can help them achieve their personal financial goals.WEPCO continued its local community outreach in 2016 by donating nearly $13,300 to various local programs. WEPCO even focused on outreach in several of its promotions. In August, through your donations, our employees’, and WEPCO itself, we collectively donated $500 to each of our local Special Olympics in Allegany, Garrett, Mineral and Preston County ($2,000 total). In October, we stood against breast cancer by collecting $1,972.60 from our members.In addition to Relay for Life and donations to charitable organizations, we held our 26th Annual Scholarship Contest, our Member Appreciation Day on Friday, April 22th, and our Kids Days on Tuesday, July 19th. WEPCO sincerely thanks everyone who donated or participated in making a difference!

Stepping Forward into 2017!

Discover the Difference

with Wepco!

President’s Report

Chairman’s ReportIn a tumultuous year that culminated in the election of the 45th President of the United States, WEPCO Federal Credit continued making great strides and fulfilling our Mission to you!

We made great progress in loan growth, exceeding our projected total in loans, and we intend to continue the trend this year. One particular area of promise was commercial lending. We made several loans for our member businesses last year, and we hope to do more this year!

Overall, our net worth remains excellent, which means the financial health of your credit union is better than ever! President McKenzie and her management team are ensuring WEPCO is a safe and enjoyable place to do business.

On behalf of the Board, we want to thank you, our members, for putting your confidence in WEPCO as your financial institution of choice. WEPCO will continue to provide you exemplary member service in this promising new year!

May God Bless You All,Mark Alexander • Chairman of the Board

As we look back at 2016, your credit union had another successful year, and we have you, our members, to thank for this success. With your continued support, we introduced some new products and services that you want.

This past year, we offered an improved Guaranteed Auto Protection (GAP) on our loans and began selling Mechanical Repair Coverage (MRC) for automobiles. MRC can help cover the repair costs on your auto, even after the manufacturer’s warranty expires, so that it will keep running in the future. MRC can either be added to a loan or paid for separately, so you can add it even if your auto is financed elsewhere. This year, we are focusing on upgrading our online and mobile banking. We understand that convenience is what our members want, and that convenience is found through your mobile device. The upgrades will include: paying your bills wherever you are; depositing checks any time of the day by taking a picture of the front and back; and applying for new share accounts and loans. Our vision is for your mobile device, whether it be a tablet or a smartphone, to become your banking center for our products and services. As we close the books on another successful year and open the new ones for 2017, we are always very appreciative of your support and loyalty. Sincerely,Michelle McElwain • Senior Vice President

Supervisory Committee ReportThe Supervisory Committee is responsible for ensuring that the financial statements properly represent the fiscal status of the Credit Union. We work with our external auditors Fike, Conner & Associates, who conduct an audit of our financial statements each year as well as

other audits required by the NCUA. The committee also works with our internal auditor to review the audit work that is performed on a monthly, quarterly, or yearly basis. Based on the findings, the committee makes recommendations to management on any matters that may arise as a result of these audit reviews.

Respectfully Submitted,Bradford D. Anderson • Chairman of the Supervisory Committee

ASSETS MEMBERS SHARES LOANS

2007 $117,706,600 20,536 $101,501,589 $75,587,8282008 $125,094,918 21,202 $108,108,485 $79,152,6242009 $154,920,564 23,076 $137,531,866 $101,335,5982010 $178,819,361 24,187 $161,923,164 $117,077,3852011 $193,628,431 24,778 $175,852,779 $112,507,8882012 $201,360,187 25,166 $182,616,313 $105,248,9222013 $197,623,158 25,538 $178,685,053 $109,066,2832014 $196,843,813 28,182 $176,362,007 $121,938,9732015 $202,421,390 28,134 $181,448,892 $136,854,2972016 $205,977,799 29,418 $184,178,192 $149,380,912

PA S T 1 0 Y E A R S G R O W T H

Your credit union continued to prosper in 2016. The management and staff of WEPCO Federal Credit Union worked diligently to meet your lending and deposit needs.

WEPCO experienced strong loan growth in 2016. All branches exceeded their production goals,

which resulted in a 6% increase overall. While the Federal Reserve considered increasing the Fed Funds rate, our members secured WEPCO mortgage loans with rock bottom rates. Thanks to you, our mortgage loan production in 2016 ended at more than $5.1 million, a 10% increase from 2015 and the highest ever for these products. As part of our Mission Statement to provide exemplary service and to offer you the products you want at prices you can

afford, WEPCO began offering Mechanical Repair Coverage in mid-2016. You can now protect your vehicle even after the manufacturer’s warranty expires.

To meet deposit needs, WEPCO began offering several new share certificates: you now have the option of a 36 month, 48 month or 60 month share certificate or IRA share certificate. Our members have deposited more than $3 million in these new products.

I want to thank you for your dedicated support in and loyalty to WEPCO. As we head into 2017, the WEPCO management and staff will continue finding new ways to meet your needs and deliver the member service that you expect and deserve. We truly believe that “Everything we do, we do for you”! Becky McKenzie • President

2 016

Senior Vice President’s Report

Mark Alexander Chairman

Walt May Vice Chairman

Cheryl Smith Treasurer

Diana Dayton Secretary

Kathy Poole Director

Donald Harvey Director

Debra Langan Director

Barry Lancaster Director

Mark Bittinger Director

BOARD OF DIRECTORS Our Official Family

LaVALE

BLOOMINGTON

OAKLAND

KEYSER KINGWOOD

SUPERVISORY COMMITTEE

PART TIME

Sue Broadwater Bookkeeper

Lori Taylor Mortgage Specialist

Amber DiUbaldo Indirect Lending Specialist

Jenny Shingler MSRLoan Officer

Keely Shoemaker MSRLoan Officer

Connie Bray MSR

Ariel Kirk MSR

Jenessa Bassford MSRLoan Officer

Carley Shaw MSR

Katelyn Valentine MSR

Sarah Miller MSR

Mariah Goff MSR

Allison Stafford MSR

Beth Lambert MSR

Carol Duncan Mortgage Specialist

Kathy Bradley Loan Officer

Shelley Curry MSRLoan Officer

Michelle Morris MSR

Jessica RonnenbergMSR

Brittany Weitzell MSR

Jill Bruckey Mortgage Specialist

Kristy Ashby Loan Officer

Crissy Fazenbaker MSRLoan Officer

Heather Kidwell MSR

Melissa Brady MSR

Brittany StullenbargerMSR

Kaitlyn Everett MSR

Sue Fazenbaker Mortgage Specialist

David Wildesen Mortgage Specialist

Susan Marple MSRLoan Officer

Rachel Ford MSRLoan Officer

Peggy Evans MSR

BJ Schroyer MSR

Mary Sisler Drive-UpMSR

Brenda Beckman Drive-UpMSR

Patrica Falkner Drive-UpMSR

Kishia Shoemaker Member LoanServicing Officer

Nicole Moore Member LoanServicing Officer

Brad Anderson Chairman

Kenneth Caplinger Debra Langan

PART TIME

MANAGEMENT

Becky McKenzie President

Michelle McElwain Vice President

Bobby Alkire Accountant

Krisite Hamilton Loan OperationsManager

Terry Apple Compliance Officer

Tonya Smiley HR Officer

Jennifer RavenscroftIT Manager

Heather DeShongCollection Manager

Marcie Lyons Bloomington Branch Manager

Ashley DiUbaldo Keyser Branch Manager

Heather Fleming Oakland Branch Manager

Brandy Roderick LaVale Branch Manager

Treasurer’s ReportSTATEMENTS OF FINANCIAL CONDITIONASSETS Dec. 31, 2016 Dec. 31, 2015Net Loans Outstanding $148,289,193 $136,098,849Cash on Hand 5,468,784 4,912,803Federal Agency Securities 16,931,624 21,554,095Fed Discount Window Investment 2,000,000 2,000,000Mid-Atlantic Corporate FCU 3,999,861 3,984,731Alloya Corporate FCU 4,131,788 4,122,367Mid-Atlantic Corporate FCU Capital Shares/CD 250,000 250,000Corporate One FCU 8,736,396 9,804,406Dain Rauscher Certificate of Deposit 1,492,000 2,237,000FTN Certificate of Deposit 3,477,626 5,962,209M & T Money Market 3,026,257 3,023,224Land & Building (Net) 5,034,823 5,209,082Other Fixed Assets (Net) 509,376 536,205Accrued Loan Interest 342,837 317,532Accrued Investment Income 54,301 69,737Accounts Receivable 14,023 156,759Prepaid & Deferred Expenses 406,101 355,141Assets Acquired in Liquidation of Loans - 41,319NCUSIF Deposit 1,812,808 1,785,932

TOTAL ASSETS $205,977,799 $202,421,390

LIABILITIESAccounts Payable $274,956 $194,587Clearing Accounts (557) (6,438)Dividends Payable 154,298 139,628Other Liabilities 1,952,180 1,272,788

EQUITYMembers Accounts 184,178,192 181,448,892Regular Reserves 3,545,824 3,545,824Undivided Earnings 17,787,921 17,122,806Unrealized Gain/Loss (154,541) (191,744)Unfunded Managers Pension (1,760,473) (1,177,108)

TOTAL LIABILITIES & EQUITY $205,977,799 $202,421,390

STATEMENT OF INCOMEINCOMELoan Interest Income $6,900,479 $6,412,936Investment Income 394,352 475,438Non-Operating Gain/Loss (17,127) 72,266Other Income 2,191,784 1,964,506

TOTAL INCOME $9,469,488 $8,925,145

EXPENSESOperating Expenses $7,780,096 $7,067,819Executive Compensation 334,755 325,495Dividend Expense 761,678 736,953

TOTAL EXPENSES $8,876,529 $8,130,267

NET INCOME $258,204 $794,878

Main Office204 North Branch Avenue, P.O. Box 157, Bloomington, MD 21523

Oakland Branch Office12826 Garrett Highway, P.O. Box 614, Oakland, MD 21550

Oakland Drive-Thru130 North Fourth Street, Oakland, MD 21550

LaVale Branch Office12511 Winchester Road, LaVale, MD 21502

Keyser Branch Office459 New Creek Highway, Keyser, WV 26726

Kingwood Branch Office202 W Main Street, Kingwood, WV 26537

301.359.3081 • 800.292.8139www.wepcofcu.com

We would like to welcome anyone within our field of membership to join the Credit Union. Take advantage of the many great services and rates that we have to offer.

Serving anyone who lives, works,worships, attends school, as well as

a business or legal entity within:Allegany & Garrett Counties in Maryland;

Mineral, Tucker & Preston Counties in West Virginia

EQUAL HOUSING

LENDERFederally insured by NCUA.

e STATEMENTS WEPCO PALPersonal Access Line

301.359.3970Toll Free: 877.WEPCO.PAL

or 877.937.2672

WEPCOPAL PlusOnline Account Access“Keeping connected with

our members”Looking Out For Our Members

67th Annual Membership MeetingSaturday, March 4, 2017Cost: $11.00 per ticket6:00 PM Dinner7:00 PM Business Meeting

Midland Fire Hall, Midland, MD

Entertainment by The Witmer Sisters

Prizes Grand: $500 1st & 2nd: $100 8 others: $25

Discover the Difference with Wepco!