Spero Annual Report

2021 ANNUAL REPORT

ZEALINA JETER Member Since 2003

AJ FAKOORNEJAD Branch Manager & Member Since 2016

SCOTT TEAGUE Member Since 2001 KAT I E G O O D N O U G H Member Since 2006

IMPROVING THE FINANCIAL LIVES OF OUR MEMBERS

Table of Contents 2

Letter from President & CEO, Brian McKay

3

Letter from Chairman of the Board, Mike Strickland

4

Letter from Chairman of the Supervisory Committee, Bill Milam

CELIA HASTINGS Member iS nce 2019

AND

Five-Year Growth Analysis

2021 ANNUAL REPORT

5

Statements of Income & Financial Condition

6

Leadership Teams

7

Member Spotlight: Marilyn Sumter

8

2021 Impact Report

10

Scholarship Winners

11

2021 Credit Union Snapshot

Brian McKay

Mike Strickland

PRESIDENT & CEO

CHAIRMAN OF THE BOARD

I F I H A D T O S U M U P 2 0 2 1 I N O N E W O R D , it would be community. Community

B E T T E R T O G E T H E R ! While this is not true all the time (think oil and water), it certainly fits the partnership of Spero Financial and the former Anderson Federal Credit Union (AFCU). The merger of these two great institutions in February 2021, was the culmination of years of ongoing dialogue between the management teams of the two credit unions. From the outset, the overarching goal was to ensure there would not only be a financial fit but also a strong cultural tie between the employees and members of a combined organization. Success would be measured by a partnership that was GREAT for three key groups:

is built on unity — people joining together with a common goal or mission. This is what started the credit union movement many years ago. As a credit union, this is part of our DNA — a trait we’ve coined cooperative spirit that simply means people helping people.

For our members and staff, Spero is a

convenience of an ATM — including expanded

community — one made up of diverse

options such as cash/check deposit. We also

individuals from all walks of life, coming

extended TellerLink banking hours, so you

together with a mission to improve financial

can speak with a teller before/after work. If

lives. By doing this, not only do you, our

you haven’t had a chance to use TellerLink, I

members soar financially, but our communities

encourage you to do so! It’s now available at all

become greater places to live, work, and play.

Spero branches.

Speaking of community, in early 2021, we

As I mentioned above, community is part

completed our partnership with Anderson

of our DNA. This year alone, we had the

Federal Credit Union. I encourage you to read

opportunity to contribute over $153,000 to 18

Board Chairman Mike Strickland’s letter for a

local non-profits to support food insecurity,

full summary of how this partnership created a

affordable housing, and more. We also

powerful synergy for our employees, members,

made a significant contribution to Anderson

and community.

University to support Trojan Football on Spero Financial Field, adopted the 8 Cooperative th

2021 was also a year of strategic planning for our organization. Together with our Board of Directors and leadership team, we

Principle of Diversity, Equity, and Inclusion, and participated in over 26 community events.

identified three key focuses that will carry

I encourage you to turn to page 8 to learn

us into 2024 and distinguish our credit union

more about our community impact, as well

in the markets we serve: (1) providing an

as view how we’ve helped our members soar

enhanced member digital experience, (2)

financially in 2021!

delivering exceptional personalized service, and (3) making a significant impact in the communities we serve.

As I close, I would like to thank you for your ongoing loyalty and trust in us; our staff for their continued dedication to our members;

We’ve all experienced the transformation that

and our volunteers for their invaluable

technology has had on our daily lives. At Spero,

guidance in moving our credit union forward.

our intention is to provide the convenience

Like the sparrow, we are stronger together! Our

of digital services, while maintaining the

credit union not only remains financially strong

personalized connection you have come to

to handle the uncertainties of the world today,

love. (Yes, we will still know you by name!)

but we also remain optimistic of our bright

One way we have already started pairing

• Employees • Membership • Community All former AFCU employees were equipped with more resources, data systems, and tools to better serve Spero’s members. In addition, employee compensation, benefits, and career opportunities were protected, and in many cases, enhanced.

Members now have greater lending and share deposit opportunities. In addition to digital banking services, members now enjoy access to ten physical branch locations across our service area from Anderson to Spartanburg. Average share per member has grown, as well as the number of Spero services used by the member.

Community impact was incredibly positive. The market presence and brand recognition for Spero Financial continues to significantly expand throughout Upstate South Carolina.

Our support of Anderson University, as well as several charitable organizations in the community have fostered our reputation as a caring organization.

Without a doubt, the partnership between Spero Financial and the former Anderson Federal Credit Union has proven that we are better together. In the 1990s, a catchword was circulating throughout the business community and being adopted as a key to success: SYNERGY — the interaction or cooperation of two or more organizations produces a joint effect greater than the sum of their separate efforts (2+2 = 6).

The synergy produced when AFCU joined Spero Financial has proven that we are better together and well prepared to soar in 2022 and beyond!

M I C H A E L ( M I K E ) W. S T R I C K L A N D

Board Chairman

future ahead.

Digital Experience with Personalized Service

It is both a privilege and an honor to serve you!

is through TellerLink! Launched in fall 2021,

I appreciate you.

this new technology allows you to enjoy the personal connection of a real teller with the

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Bill Milam CHAIRMAN OF THE SUPERVISORY COMMITTEE

5-Year Growth Analysis

INCOME

ASSETS

2021 A S C H A I R M A N of the Supervisory Committee, it is with great privilege to report another strong fiscal year for Spero Financial Federal Credit Union. As of December 31, 2021, financial outcomes reflect sound, operational stability for the organization, in conjunction with favorable quarterly internal audit reports. These measures are a result of how the management and staff

2020 2019

$551 million $422 million $388 million

2018

$369 million

2017

$367 million

of Spero Financial are unrelenting in exercising sound judgment and practices as they carry out their fiduciary responsibilities in utilizing member funds so that both members and the Credit Union can soar financially now and into the future.

Each year Spero Financial undergoes an external audit from a third-party CPA firm as an added layer of accountability. This audit measures the effectiveness of the organization’s financial management. I am pleased to report that Spero Financial has yet again received a very positive “unmodified opinion” regarding the Credit Union’s financial statements for 2021 year-end.

2018 2017

$489 million $369 million

listed below. The Credit Union experienced significant growth across assets, loans, and member shares. A net worth growth of 20.50% and $4.1 million income signifies

18,251,707

459,106

415,427

Other Income

9,950,734

7,650,478

Total Income

$32,518,169

$26,317,612

Compensation & Benefits

13,698,082

11,222,870

General & Administrative

11,830,696

13,368,907

Provision for Loan Losses

147,078

1,500,478

$25,675,865

$26,092,255

45,634

287,241

2,648,848

3,800,521

$4,147,831

($3,862,406)

2021

2020

$424,786,698

$323,685,087

41,244,702

41,704,803

3,314,724

104,881

Investments

42,912,021

18,549,096

20,362,702

16,282,048

1,213,432

992,469

Other Assets

18,050,101

20,809,470

Total Assets

$550,670,946

$422,127,854

488,984,364

368,525,730

Other Liabilities

5,617,440

5,617,440

Total Liabilities

$494,601,804

$374,143,170

57,235,931

47,984,082

583,459

602

$550,670,946

$422,127,854

From Investments

EXPENSES

Dividends Paid to Members Net Income

$292 million

Statement of Financial Condition

$318 million

ASSETS

LOANS

2021

22,108,329

Interest on Loans

$316 million

The synergy created through the partnership with AFCU is underscored by the strong key performance indicators

2020

Interest Expense

2021

2019

2021

Total Expenses

DEPOSITS

2020

Statement of Income

Loans $427 million

Cash & Cash Equivalents Short Term Interest Bearing Accounts

the fiscal strength and stability of the organization.

2020

2 0 2 1 K E Y P E R F O R M A N C E I N D I C AT O R S

2019

$295 million

Property & Equipment

2018

$299 million

Accrued Interest Receivable

• Net Worth Growth of 20.50% • Assets increased to $551 million (30.45% gain over 2020) • Loans increased to $427 million (30.45% gain over 2020) • Deposits increased to $489 million (32.69% gain over 2020)

2017

$328 million

$284 million

• Net Income closed at $4.1 million • 5,792 New Members joined the Credit Union I encourage you to review the balance sheet, income statement, and other financial information included in this year’s report. You will find that Spero Financial continues to operate in a safe and sound manner, strategically focused on improving the financial lives of our members. This financial strength positions us well to soar into the future!

2021 2020 2019 2018 2017

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LIABILITIES

N E T W O R T H /A S S E T R AT I O

10.50% 11.37% 13.35% 13.63% 11.35%

Shares

MEMBER'S EQUITY

Member’s Equity Reserves Unrealized Gain/Loss on Investments Total Liabilities & Member’s Equity

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S O A R

Marilyn Sumter

T O

Member Spotlight

M A D E

Leadership Teams

WHEN SHE BECAME A SPERO MEMBER in June of 2001, Marilyn Sumter a w nted more than just savings accounts and (nancial services. She a w nted to feel like she belonged. “Community is extremely important to me,” she shared. “Serving the community, being a part of the community, interacting with the community — community is everything.”

As Marilyn got to know the Spero team, she realized she’d found something special. “There is nothing like a w lking into your neighborhood branch and being greeted with a a w rmth that makes you feel like family, like they’re always happy to see you.” This sense of belonging gave her the con(dence she needed to make a fresh start.

“Spero Financial has helped me in all aspects of my life, from buying my (rst e v hicle and purchasing both of my homes to my personal loans and credit cards.

They've helped me on a (nancial journey that has me settled.” Re)ecting on her journey, she added, “They gave me a chance to start my life over.”

BOARD OF DIRECTORS

Pictured left to right: Anthony Lawrence • Bryant Harrison • Mike Strickland Chairman • Roy Hayes Secretary/Treasurer • Michael Cunningham • Lee Brown • Steve Griffin Vice Chairman, Not pictured • Hughlyn Burgess Not pictured • Joy Owens Not pictured

The thing that stood out most to Marilyn a w s the Spero team’s iw llingness to help, even iw th situations that other (nancial institutions tend to avoid. E “ e v rybody messes up on their credit. Everybody o d esn't get (nances right. Everybody o d esn't get budgeting right. Everybody o d esn't get life right. But Spero Financial? They're going to stand by your side, comfort you, and help you make your situation better.”

While she’s had plenty of o w nderful experiences iw th the Spero team over the years, Marilyn remembers one in particular that perfectly captured Spero’s commitment to improving the (nancial lives of its members. Facing a challenging (nancial situation, she id scussed the e d tails iw th a Spero associate h w o simply responde,d I“ t’s okay.

Let’s see h w at e w can o d .”

SUPERVISORY COMMITTEE

Pictured left to right: Frankie Nelson • Janet Fancher • Bill Milam Committee Chair Sheree Ramey • Andrew Williams Not pictured

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EXECUTIVE LEADERSHIP TEAM

Pictured left to right: Jessica Baker Senior Vice President, Chief Operating Officer Robert Wilson Senior Vice President of Lending and Sales Toni Davisson Senior Vice President, Chief Financial Officer Brian McKay President, Chief Executive Officer Damon Sipe Senior Vice President of Technology

Let’s see what

e w

can do.

With a smile spreading across her face as she told her story, Marilyn said it’s the e “w ” that sets Spero apart.

“When they comfort you by saying it’s okay and then give you the ability and encouragement to accomplish your (nancial goals, it makes it easy to let your guard down and see what e w can do together.”

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IMPROVING FINANCIAL LIVES

2021 Impact Report

212 mortgages

119 members

(over $62 million) to make members’ homebuying dreams come true

received a lower-rate by refinancing their

2,679 personal loans

4,003 auto loans

(over $12.7 million) to fund members’

(over $87 million) that put our members in

financial goals

the driver seat

mortgage with Spero

EARNINGS AND PERKS FOR OUR MEMBERS

Members received

Members received

for using their credit cards

through Kasasa Cash/Cash Back accounts

$2,671,629 given back

$114,466 in total

to members as savings/checking account earnings

online balance transfers on Spero

29,641,494 points

$46,462 in ATM refunds

credit card

H E L P I N G O U R M E M B E R S S OA R F I N A N C I A L LY

As a mission-driven organization,

528 members

30 community members

impacted by Spero financial wellness resources

participated in 2 community financial wellness workshops

we’ve been improving the financial wellbeing of our members in the Upstate and Midlands for over 85 years. It’s not just something we say, it’s what we do! These numbers are not just numbers — they represent

$153,000 donated

$12,895 contributed

real lives changed! At Spero, we

to 18 local non-profits to support food insecurity, affordable housing, and more

to 10 Upstate schools to support

financial hope not only transforms

$1,000,000 donated

$9,000 granted

the lives of our members, but it

to Anderson University to support Trojan Football

to 3 Spero members to support their

know that inspiring and nurturing

also transforms our communities — making them greater places to live, work, and play.

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M A K I N G O U R C O M M U N I T I E S B E T T E R P L A C E S T O L I V E , W O R K , A N D P L AY

student athletics

higher-education aspirations

Spero participated/hosted over

26 community events

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R A L P H H A M I LTO N Member Since 2014

Scholarship Winners Since 2010, Spero Financial has invested $108,000 into future generations by awarding 3 scholarships to Spero Financial members who are pursuing higher education each year. Congratulations to the 2021 Louis C. Addition College Scholarship winners!

Whitner Bobo In the fall, Whitner “aka Whit” will be attending Abraham Baldwin Agricultural College. Whit is a member of Future Farmers of America, Health Occupations

2021 Snapshots

Students of America, National Beta Club, and National Honor Society. In her

Soaring as Spero Financial

community she volunteers with Meals on Wheels, Haven of Rest, Belton Depot Community Revitalization, and Belton’s Veteran Park. Her educators describe her as highly self-motivated, trustworthy, and a dedicated individual. Upon

• 50,080 Total Members

completion of her Bachelor of Science in Agriculture, Whit plans on attending

• $559 Million in Assets

University of Georgia for her master’s degree.

• Named 2021 Best Places to Work in South Carolina • Top 3 Finalist in 2021 Best of the Upstate Community Choice Awards

Emily Truman

• 3 CUNA Diamond Awards for Brand Awareness, Member Publication/Newsletters, and Video Non-Commercial Series

In the fall, Emily will be attending Anderson University. Her educators describe

Top Stories of the Year

her as a role model, leading by example, and exceeding expectations. Emily coaches Atown Volleyball, is the co-captain for Crescent Varsity Volleyball, and volunteers as a Learning Buddy for Anderson School District 3. She is a

•

Anderson Federal Credit Union officially joined Spero Financial — making it the largest credit union merger in the history of South Carolina.

•

8 T H C O O P E R AT I V E P R I N C I P L E :

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Spero Financial contributed $1 million to create Spero Financial Field in support of the new Trojan Football Program kicking off fall of 2024.

member of the Beta Club, National Honor Society and has been recognized as a Student Scholar. Upon completion of her Bachelor of Science in Nursing degree, Emily plans to get her master's degree in advanced nursing in pediatric orthopedics.

Karina Wolfe Karina currently attends Bob Jones University. There, she leads as a Campus Security Officer and Society Officer of Tri Epsilon. In the community, Karina volunteers with the Greenville County Detention Center, Hampton Park Baptist Church, and is the Deputy Stage Manager of Bob Jones Academy Stage Crew. Her professors describe her as a leader and a motivator; she’s always going above and beyond expectations. Upon completion of her Bachelor of Science degree, Karina is exploring pursuing a master’s degree in Criminal Justice or Aviation.

BECOMING ONE:

Spero Financial executed the 8th Cooperative Principle of Diversity, Equity, and Inclusion (DEI) signifying the organization’s commitment to furthering DEI. SPERO FINANCIAL FIELD:

Taking Care of Team Spero • 159 employees serve the organization across 33 different departments • 240 individuals provided with medical insurance — both employees and their families • 25,012 hours of paid time off was awarded • 22 promotions and 14 transfers to roles in other departments • 2 retirements celebrated

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THANK YOU T O O U R S TA F F, MEMBERS, & COMMUNITY

EVAN OUELLE T TE Lending Service Specialist & Member Since 2015 SARAH CLINKSCALE Regional Manager & Member Since 2009

spero.financial Insured by NCUA