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					      TEXOMA COMMUNITY CREDIT UNION

                  BUSINESS CONTINUITY PLAN


PLAN OVERVIEW

FINANCIAL IMPACT ANALYSIS

OFFSITE STORAGE

CRITICAL VENDORS BUSINESS CONTINUITY

GENERAL BUSINESS CONTINUITY PLAN

CRITICAL VENDORS AND RELATIONSHIPS

BUSINESS IMPACT ANALYSIS

BUSINESS CONTINUITY ACTION STEPS




                     Approved and adopted May, 17 2012




                                    [1]
                      BUSINESS CONTINUITY PLAN
                         TEXOMA COMMUNITY CREDIT UNION


                                       PLAN OVERVIEW

INTRODUCTION

         The overall goal of the Business Continuity Plan is to provide guidance for the recovery
and continuation of the business process of the credit union when operations have been disrupted
unexpectedly. The credit union plays a crucial role in the economic activity of its members and
within the economic area it serves. Disruptions in basic services should be minimized to avoid as
much as possible the financial inconvenience of members and to maintain public trust and
confidence in both the credit union and the overall financial system.
         The primary goals of this plan are to (1) minimize financial loss to the credit union, (2)
serve its members with minimal disruptions, and (3) mitigate the negative effects of disruptions
on business operations.
         It is also a goal of this plan to conform to laws, rules, and regulations promulgated by the
Texas Credit Union Department, National Credit Union Administration, Federal Financial
Institutions Examination Council, and any other governing agencies that may apply.
         This plan attempts to address potential catastrophic events that may apply only to the
credit union itself and to area-wide events that could impact the operation of the credit union
directly or indirectly and result in significant losses. In addition to such events, consideration is
also given to events that might affect interdependencies among infrastructure services providers
and other financial system participants.

BOARD AND MANAGEMENT RESPONSIBILITIES

        The Board of Directors and Management must endeavor to identify, assess, prioritize,
manage, and control risks that can disrupt the business process of the credit union. The Board is
responsible to establish policies that define how the credit union will manage and control the
risks that are identified.
        The Management Team will meet semiannually to review pertinent aspects of this plan.
Pertinent aspects include events such as a change in a third party vendor relationship; a
significant change in IT technology, equipment, or operations; changes in the credit union’s
operations; or, change in personnel involved in the business continuity process. Relative audit
and examination findings and lessons learned through testing the plan will be integrated into the
plan. Management will update the plan to reflect any changes and will report such changes to the
Board of Directors. If a change in policy becomes necessary, Management will submit such

                                                [2]
change to the Board for approval and adoption. The semiannual review will address the
following as a minimum:
             Have there been additions or changes to the critical vendors and contacts?
                Management will assign an employee(s) to call or otherwise contact the vendors
                and contacts to verify the information.
             Have new services been added that should be addressed in the business continuity
                plan?
             Has there been a change in IT technology that is not addressed in the business
                continuity plan?
             Has equipment been purchased that should be addressed in the business continuity
                plan?
             Has there been a change in credit union personnel involved in the management of
                the business continuity plan?
             Have recommendations from auditors, examiners or from previous tests of any
                part of the plan been included in the plan?
             Are there any new laws, regulations, or rules that impact anything in the business
                continuity plan? If so, amendments must be made to the pertinent parts of the
                plan.
             Is there any part of the business continuity plan that needs to be tested? If so,
                when will this test take place and who will be involved in the test?
        Management will submit the Business Continuity Plan annually to the outside auditors
for their review. The Board of Directors through its Audit Committee will assure that elements of
the plan are reviewed periodically during the internal audit process.
        The Board of Directors and Management will cause parts of the Business Continuity Plan
they deem to be critical and most likely to occur to be reviewed and/or tested at least annually.
Parts of the plan where the possibility of occurrence is only remote will be reviewed annually
and subjected to a “table test.”

BUSINESS IMPACT ANALYSIS

         The first step in preparing a business impact analysis is to perform a financial impact
analysis. This analysis projects the total financial risk to the credit union over a period of time
ranging from one day to thirty days. An analysis document is available at
http://ongoingoperations.com. The analysis is based on data from the credit union’s Call Report
on file with the NCUA. This analysis projects the risk to cash flows and income from operational
activities of the credit union and is an indicator suggesting priorities in evaluating the impact on
business functions and processes.
         When the risks have been assessed and prioritized, the potential impact on these activities
from catastrophic events will be identified. Emphasis will be placed on disruptions that are most



                                                [3]
likely to occur instead of concentrating on events that may never affect operations. The impact of
legal and regulatory requirements must also be considered in the analysis.
        The business impact analysis will consider the following questions as they might apply to
mission critical functions and each department affected:
             What critical interdependencies exits between internal systems, applications,
                business processes, and departments?
             What specialized equipment is required and how is it used?
             How would the department function if the mainframe, network and/or Internet
                access were not available?
             What single points of failure exist and how significant are those risks?
             What are the critical outsourced relationships and dependencies?
             What are the required responsibilities of the credit union and a third-party service
                provider as defined by the service level agreement?
             What critical operational or security controls require implementation prior to
                recovery?
             What is the minimum number of staff and amount of space that would be required
                at a recovery site?
             What special forms or supplies would be needed at a recovery site?
             What equipment would be needed at a recovery site to communicate with
                employees, vendors, and members?
             Have employees received cross training, and has the department defined back-up
                functions and/or roles that employees should perform if key personnel are not
                available?
             Are the personal needs of employees adequately considered?
             What are the critical cash management/liquidity issues?

CATASTROPHIC EVENTS

        A catastrophic event is any event that materially disrupts normal business operations and
impedes offering essential services to members for at least one business day. A business day is
defined as the posted normal days of operation of the credit union and on which the Federal
Reserve Bank of Dallas is open for business.
        Events that can disrupt business for one day include, but are not limited to, a local or
general power outage; inclement weather such as an ice storm, blizzard, or flood; a robbery;
temporary failure of data processing systems; or structural damage to the main office building
that obstructs the use of the data processing system. There is a reasonable possibility that any of
these events could happen at any time. The essential services that must continue to members
during these short-term events are electronic payments processing (ACH and share draft) and
cash services.



                                                [4]
        Events that can disrupt business for up to three business days include, but are not limited
to, general power outage caused by tornado, ice storm, high winds, or other weather or accidental
cause or a severe but not fatal loss of data processing capability. Also within this magnitude of
disruption is the sudden and unexpected loss of the Chief Executive Officer through death,
accident, or termination of employment.
        Events that can disrupt business for more than three business days include, but are not
limited to, the loss of the credit union’s main office because of a direct hit by a tornado, fire,
impact by aircraft, or collapse of the building from an earthquake or other cause.
        There are other events that can disrupt normal business such as en masse resignation or
loss of the entire management team, a pandemic that eliminates the majority of staff in a
department or the entire credit union, or a sick-out or strike.
        Other events that can disrupt the ability of the credit union to carry on its normal business
operations include:
             A catastrophic event against the credit union’s main data processing supplier,
                Computer Management Corporation, Salt Lake City, UT.
             A catastrophic event against the credit union’s telephone and major Internet
                supplier, Web Fire Communications, Wichita Falls, TX
             A catastrophic event against the credit union’s main transaction processor,
                Catalyst Corporate Federal Credit Union, Plano, TX.
             A robbery at American National Bank, Wichita Falls, TX, that delays the
                shipment of vault cash.
             A robbery of the armored car while vault cash is in transit, Ray Cannedy Armored
                Service, Wichita Falls, TX.
             A disruption of the Federal Reserve Banking System that prevents data files for
                ACH and share drafts being delivered to Catalyst Corporate Federal Credit Union.

RISK ASSESSMENT

        The risk assessment process is a good faith and best guess process that lies in the personal
judgments of members of the Board of Directors and Management. In the process of assessing
risk, Management completed a Business Impact Analysis for aspects of the catastrophic events
identified above. In completing each Business Impact Analysis, attention is given to third party
relationships, duration, the level of probability, and the level of criticality.
        Risk assessment is done by scheduling various failure scenarios for each possible failure
event. A failure event is an area of service, a physical event, or personnel event experiencing a
disaster or extended interruption. Failure events identified are:
             Cash Services
             Electronic Payments
             Opening Accounts
             Lending


                                                [5]
           Management
           Physical Disaster
           Internet Failure
       The anticipated durations of failure scenarios for an event are:
           Immediate – One day or less
           Short-term – One to three business days
           Intermediate – Four to ten business days
           Long-term – Greater than ten business days.
       The probability of a failure scenario occurring for an event is defined as:
           1 – Very little probability
           2 – Less than likely to occur
           3 – Possible but not likely to occur
           4 – Reasonable chance of occurring
           5 – Most likely to occur.
       The criticality of a failure scenario should it occur is defined as:
           1 – Least serious
           2 – Less serious
           3 – Serious but very manageable
           4 – Very serious
           5 – Most serious.

RISK MONITORING AND TESTING

        The business continuity for each failure event will be reviewed by Management semi-
annually. The scope of this review is to review all action steps for each failure scenario to
determine that they are still valid; determine that persons identified with responsibilities under
the action steps are still employed by the credit union and able to carry out their responsibilities;
data processing systems and/or back up provisions are still in place; and any third party vendors
are properly identified and their contact information is up to date. A summary report of this
review will be given to the Board of Directors and recorded in the minutes of the Board
Meetings.
        A Financial Impact Analysis will be obtained from www.ongoingoperations.com prior to
each semiannual review of the business continuity plan. This analysis will be compared to the
last previous analysis to see if any major changes have occurred. Management will document
any significant shifts in exposure and make any necessary adjustments or changes to any event
scenarios that may be affected.
        Management will schedule tests, or dry runs, of business continuity plans for each failure
event once per year. Individual failure scenario tests may be spread across the entire at the
discretion of management. Management, at its discretion, may opt for a table test of any or all
scenarios. A table test will include all personnel involved in a scenario and will involve


                                                [6]
discussion, question and answer sessions, and limited hands on application where possible so
that the involved personnel are updated on their responsibilities and where pertinent data and
equipment are located.
        Management will apply lessons learned from a test to the continuity plan for a failure
scenario and make changes that are evident and necessary.

COPIES OF THE BUSINESS CONTINUITY PLAN

       Printed copies of this plan will be kept in three physical locations.

       Southwest Parkway Office, safe deposit box #______

       Personal Residence of the President
              Wayne Mansur
              1620 Weeks Avenue
              Wichita Falls, TX

       Personal Residence of the Chairman of the Board of Directors
              Robert Russell
              XXXXX
              Wichita Falls, TX

         In addition to printed copies of this Plan, electronic copies will be kept in two cyber
locations. (1) The Policy Directory on the credit union’s mainframe computer; (2) The
restricted Board and Management section of the credit union’s web page www.texomacu.com.




                                                [7]
 Financial Impact Analysis

 Texoma Community Credit Union
 This report is an estimate based on NCUA data reported for your credit union and other standard industry assumptions. Please contact us to schedule a more in-depth
 analysis, which will take your specific business processes and other customized factors into account. In addition to assessing your potential financial impact, our Certified
 Business Continuity Planners can also perform a full Business Impact Analysis (BIA) to help you accurately assess a wider spectrum of risks and begin developing plans
 to mitigate them. Contact us today at 877-552-7892 or sales@ongoingoperations.com.




$ 96M       TEXOMA COMMUNITY                                            Day 1                 Day 3                Day 7                Day 15                Day 30
            ACH Risk                                                                        $33,188             $165,939             $431,441              $896,071
            Collections Risk                                           $3,979               $11,936              $28,838               $79,409             $190,874
            Credit Card Risk                                               $0                    $0                   $0                    $0                    $0
            Debit Card Risk                                            $1,763                $5,289              $12,342               $26,447               $52,894
            Fee Income Risk                                            $2,180                $6,540              $15,261               $32,702               $65,404
            Item Processing Risk                                                             $8,935              $44,674             $116,154              $241,242
            Loan Interest Risk                                        $11,385               $34,154              $79,693             $170,770              $341,541
            Reputation Risk                                            $6,213              $169,301             $604,202            $1,474,005            $3,104,886
            Shared Branching Risk                                        $546                $1,638               $3,822                $8,189               $16,378
           Total:                                                     $26,066              $270,982              $954,771            $2,339,117            $4,909,289




                                                                                     [8]
                                                                                                                                                            877-552-7892
 Prepared 3/21/2012 using 12/31/2011 NCUA Data                                                                                               http://ongoingoperations.com
Financial Impact Analysis

Texoma Community Credit Union
This report is an estimate based on NCUA data reported for your credit union and other standard industry assumptions. Please contact us to schedule a more in-depth
analysis, which will take your specific business processes and other customized factors into account. In addition to assessing your potential financial impact, our Certified
Business Continuity Planners can also perform a full Business Impact Analysis (BIA) to help you accurately assess a wider spectrum of risks and begin developing plans
to mitigate them. Contact us today at 877-552-7892 or sales@ongoingoperations.com.




   Fee Income Risk                                                                                                          Assumptions
                    YTD Fee Income                         $991,963                                                       Fee Income Risk                  80%
      Daily Fee Income Per Checking                           $0.68
            Fee Income Risk Per Day                          $2,180
   Fee income is the first area at risk given an interruption in ordinary business. If the core processor is unavailable or other systems which post fees and other
   charges to the member accounts, the Credit Union will realize an immediate impact to the daily bottom line

   It is common practice for most credit unions to refund member fees when they are adversely affected by circumstances beyond their control.




   Check & ACH Risk (After 2 Days)                                                                                          Assumptions
        Number of Daily Check Items*                          1,312                                              Average Check Amount                   $1,362
       Returned Checks Per Day Risk                          $8,935                                                % of Check Returned                   0.5%
        Number of Daily ACH Items**                           1,203                                               Average ACH Amount                    $2,123
         Returned ACH Per Day Risk                          $33,188                                                 % of ACH Returned                    1.3%


   *The formula is based on the Federal Reserve Average Daily Statistics (2007 Payments Study)
   **10% of Total Members




   Daily Loan Risk                                                 Interest Income                Yield
                                                                                                                            Assumptions
           Outstanding Loan Balance                    $72,002,831      $4,965,793               6.90%
     Outstanding Investment Balance                     $7,649,790         $87,307               1.14%
                       Total Portfolio                 $79,652,621      $5,053,100               6.34%

              Loans Granted Annually                   $33,493,166
        Days to turn over loan portfolio                       783
                 New loan risk per day                     $92,014                 $11,385

   The credit union must consider the value of lost income due to a member taking their loan elsewhere because the CU is not open for business. We calculate this
   based on your overall portfolio APR which is derived from loan and investment data. New loans per day dollar amount is based on your total loans divided by the
   average portfolio life. Loan interest risk per day is derived by taking the new loans per day times the net yield (loan APR - investment APR) times average portfolio
   life. This gives the credit union a reasonable estimation of the cost of lost business due to an interruption.




                                                                                    [9]
Financial Impact Analysis

Texoma Community Credit Union
This report is an estimate based on NCUA data reported for your credit union and other standard industry assumptions. Please contact us to schedule a more in-depth
analysis, which will take your specific business processes and other customized factors into account. In addition to assessing your potential financial impact, our Certified
Business Continuity Planners can also perform a full Business Impact Analysis (BIA) to help you accurately assess a wider spectrum of risks and begin developing plans
to mitigate them. Contact us today at 877-552-7892 or sales@ongoingoperations.com.




   Daily Transaction Risk                                                                                                   Assumptions
                Number of Credit Cards                              0                                         Credit Card Stand-In Limit                  $250
                   Credit Card Balance                             $0                                         Debit Card Stand-In Limit                   $250
                Credit Card DQ Balance                             $0                                            Debit Card Penetration                   40%
                       Credit Card DQ%                         0.00%
                                                                                             Avg # of Shared Branching Transaction                         250
                  Daily Credit Card Risk                           $0
                                                                                                     Avg Shared Branching Amount                          $500
     Number of Share Draft Accounts                           4,037
             Number of Debit Cards                            1,615
                   Reportable DQ%                          0.0044%
               Daily Debit Card Risk                         $1,763

      Shared Branching Risk Per Day                             $546




   Delinquency Risk                                                                   DQ %
                                                                                                                            Assumptions
             Outstanding Loan Balance                  $72,002,831                                              Change in DQ-Days 1-5                   0.01%
                   Total DQ > 60 Days                     $314,470                    0.44%                    Change in DQ-Days 5-10                   0.05%
                  Total DQ <= 60 Days                     $786,456                    1.09%                    Change in DQ-> 10 Days                   0.08%

                                                     Days 1 to 5        Days 5 to 10          >10 Days
           Estimated Rate When Down                    0.0049%             0.0074%             0.0224%
                  Additional Loan Risk                     $960              $1,453              $4,412




   Reputation Risk                                                                                                               Assumptions
                                                                                                                                     All Members Online Members
                  Number of Members                         12,025
                Annualized Net Income                     $938,371                                           Closure % Day 1                 0.01%                  0.03%
              Annualized Net Revenue                    $5,177,398                                           Closure % Day 2                 0.10%                  0.25%
             3 Year Value of a Member                    $1,291.66                                           Closure % Day 3                 0.20%                  0.50%
                                                            Day 1             Day 2             Day 3
                  Lost Revenue Per Day                     $6,213           $54,363          $108,725

   Reputation Risk annualizes revenue from the previous 4 quarters and multiplies by 3 to determine the 3 year value of a member. This 3 year value is then used to
   determined a per day loss of revenue based upon the account closure assumptions.




                                                                                   [10]
                                OFFSITE STORAGE

        The following provisions will secure the ability of the credit union to maintain an
ongoing presence for its members in the local financial service arena regardless of a physical
disaster or other possible business interruption. The first priority is to be able to service the cash
requirements of members in the event of a disaster; to effect this, a record of account balances
and access to currency and coin are absolutely necessary. All other functions are less time
sensitive and can be addressed once members’ basic need has been met.

I. MEMBER TRIAL BALANCE AND NAME AND ADDRESS FILES.

        Copies of the member trial balance and name and address files will be generated daily at
the close of business so that this information will be as accurate as possible at the beginning of
any day on which a failure event should happen. This data will be forwarded by CMC Flex by
email in the form of a PDF file to the Chief Operations Officer, the IT Manager, the CEO, an the
CFO.

II. BACKUP OF MAINFRAME COMPUTER.

        The daily and month-end backups of the mainframe computer system, including the
operating system and data files, are processed offsite by CMC Flex and maintained in its offsite
secure storage facility in Utah. 800-262-3539

III. OTHER SENSITIVE DOCUMENTS.

      Other sensitive documents will be stored in a safe deposit at the credit union’s Southwest
Parkway office, 4019 Southwest Parkway, Wichita Falls, TX. The CEO will have a record of the
documents at this location maintained in a readily accessible location in the executive offices.

IV. CASH.

       Currency and coin are stored in industrial standard, insured safes that can withstand
trauma from the destruction of a building and are fire resistant.




                                                [11]
         CRITICAL VENDOR BUSINESS CONTINUITY

       The credit union recognizes that the most critical services it provides for members is
payment processing. Members depend on electronic payments and share drafts for the purchase
of goods and services. Disruption of these services negatively impacts members in the short-term
more than not being able to make a loan or open an account.
       The credit union is dependent upon three critical vendors for processing electronic
payments and share drafts: CMC Flex (mainframe computer); Catalysit Federal Corporate Credit
Union (all electronic settlements); and Vantiv (ATM and debit card interchange).

CMC Flex

       CMC Flex is the provider of the credit union’s core processor. The credit union uses an
in-house mini mainframe and operates almost independent of CMC. There are certain
applications which require the intervention of CMC, such as accessing the on-line banking
application, but such applications are not critical should a disaster at CMC occur.
       SAS70 filed by CMC Flex states that CMC Flex has back up of critical applications
performed and the backup medial stored off site. This media is tested periodically. A hotsite is
maintained in a highly secured environment that has essential connectivity to critical
communication links capable of handling high volumes of data and images. Data is mirrored
throughout the business day so that all data is current.

Catalyst Federal Corporate Credit Union

       The Corporate Credit Union is vital to all electronic member transactions and a disaster at
Corporate would deny members access to essential electronic transactions.
       SAS70 filed by Catalyst states that Catalyst has back up of critical applications
performed and the backup medial stored off site. This media is tested periodically. A hotsite is
maintained in a highly secured environment that has essential connectivity to critical
communication links capable of handling high volumes of data and images. Data is mirrored
throughout the business day so that all data is current.

Vantiv

         Vantiv serves as interchange agent for the credit union’s ATMS and debit cards. This
service is critical for members as remote access to cash and the ability to make purchases from
their accounts via debit cards is essential for the purchase of goods and services. The failure of
Vantiv to be able to intercept and forward these transactions would severely limit our members’
ability to purchase essential goods and services.
         Vantiv is located in Cincinnati, Ohio and its data processing center is located across the
state line in Kentucky. Vantiv maintains a hotsite in Michigan that has the ability to immediately
take over all data processing functions of the Kentucky site. The transfer of processing from
Kentucky to Michigan would be instantaneous and transparent to users of ATMs and debit cards.



                                               [12]
       Should the Michigan hotsite fail simultaneously with the Kentucky processing center,
ATM transactions would not process. Debit cards would continue to process in stand-in mode
through MasterCard.




                                           [13]
           GENERAL BUSINESS CONTINUITY PLAN

        Providing essential cash services to members during any kind of business interruption is
the highest priority of the credit union. The essential services are identified in order of priority
as:
            1. Cash,
            2. Electronic payments,
            3. Credit, and
            4. Opening account.
In the event of a disaster or interruption in normal business conditions the credit union’s highest
priority will be to make cash available to members so that they can purchase essential goods and
services while an emergency condition exists. Receiving and processing electronic payments is
of high importance as these transactions make deposits to member’s account and make
authorized electronic payments for many essential services critical to members, such as utility
payments, during an emergency condition. Credit transactions and the ability to open accounts
are considerably lower in importance during an emergency and will be brought on line at the
discretion of management given the existing conditions and the amount of time before normal
business operations can be restored. In any event, credit transactions and opening of accounts
will be made available on the fourth business day during an extended disaster event.
        While there are any number of events that can cause prolonged disruption of the credit
union’s ability to service its member’s essential business needs, the most likely of these events is
the loss of electrical power due to weather events, such as tornado, ice storm, blizzard, or
flooding, or through human action, such as a terrorist attack on the power grid or something as
simple as a drive accidently knocking down a power pole.
        Each office of the credit union will operate in manual mode for the following time
frames.
        MAIN OFFICE: 4 hours in a single business day. If a power outage is expected to last
longer than 4 hours in a single business day, the President or his appointed representative will
decide if a generator is needed to continue operations.
        SOUTHWEST PARKWAY OFFICE: 48 hours or two full business days. If a power
outage at this office is expected to last longer than 48 hours, the President or his appointed
representative will decide if a generator is needed to continue operations at this office. At the
President’s discretion, this office will either operate in manual mode or refer members to the
main office.

MANUAL OPERATIONS KIT

        A manual operations kit consisting of 200 deposit/withdrawal slips, 25 loan applications,
and 10 signature cards will be kept in secure locations at both offices. In addition, a supply of
blank drafts/checks on the credit union’s account will be kept at the main office. The secure
locations are:
        MAIN OFFICE: the safe in the computer room.
        SOUTHWEST PARKWAY OFFICE: safe deposit box #___.
        In addition to these paper documents, the Chief Operations Officer and the IT Manager
(at the minimum) will receive daily copies of the member trial balance in email form from CMC

                                               [14]
Flex. These documents will be transferred to USB drives and kept in their possession or stored in
the safe in the computer room.

MANUAL MODE

        Interruptions in the power supply are usually short in duration as the power company is
notably prompt in identifying the cause of an interruption and restoring the power supply. If
there is a disruption in the power supply that exceeded 15 minutes, the President will have an
employee call Hudson Electrical Services, 866-483-7667 to find out how long it will take for the
power to be restored.
        If the power at the main office will be restored within 4 hours on a given day, teller
services will be conducted in “manual mode.” Loan officers may continue to accept loan
applications but must inform the member(s) that they cannot act on the loan request until power
has been restored. IT will make the member trial balance of accounts available on a laptop
computer for the tellers to use in making cash withdrawals.

       Teller Transactions in Manual Mode

        1. Deposits. Tellers will accept deposits using deposit slips and give members hand-
written receipts showing the date, account number and suffix, the amount deposited and the teller
number and initials of the teller receiving the deposit. The deposit will be kept in a secure
location and held until power is restored at which time they will be posted to members’ accounts
and forward cash letters transmitted to Catalyst Corporate FCU. Members will be advised that
Reg. CC holds will be in place beginning on the day that cash letters can be transmitted.
        2. Withdrawals. Members must fill out withdrawal slips. The withdrawal amount will be
verified against the balance of the member’s account as shown on the member trial balance of
accounts. If a member requests a withdrawal for more than the balance of his/her account, an
officer of the credit union must approve the withdrawal.

EMERGENCY GENERATORS

        Emergency power generators will be rented to provide limited electrical power to the
main office if an electric outage will exceed 4 hours in a business day and 48 hours at the
Southwest Parkway Office.
        Generators sufficient to power the mainframe computer, 3 PCs with monitors, and one
printer will be rented for the main office. Generators putting out 120 volt, single phase power
producing not less than 50 amps each, or 400 amps for a single generator, are required. Also, 4
50-foot heavy duty power cords, 4 power strips, and assorted male-female plug adaptors must be
on hand to convey power from the generators to the computer equipment.
        Should a generator be needed for the Southwest Parkway Office, it must put out 120 volt,
single phase power producing 45 amps and power the back officer computer connectivity
equipment and one PC with a monitor. One 50-foot heavy duty power cord and one power strip
must be on hand to connect the computer equipment to the generator.
        The following companies in Wichita Falls can be contacted for rental of generators.
These companies may be able to obtain generators from other cities if there are none available in
Wichita Falls.

                                              [15]
             RSC Equipment Rental                           ASCO Equipment Rentals
            6230 Southwest Parkway                         2900 Henry Grace Freeway
               Wichita Falls, TX                               Wichita Falls, TX
                 940-692-0123                                    940-687-2726

       An extended or city-wide power failure may make local rental of generators impossible
because of the excess demand. In that event, companies north of the Red River may be
contacted. Pioneer Equipment is a state-wide company and may be able to obtain generators
from a more distant city that has not been affected by the conditions in Texoma. Also, these
companies can help to find generators in Oklahoma City if that should be necessary.

Pioneer Equipment Rentals    ARA Equipment Rentals     Volvo Rentals        Rent City
901 SE Interstate Drive      2318 West Gore Blvd.      3325 N Highway 81    1025 N Main Street
Lawton, OK                   Lawton, OK                Duncan, OK           Altus, OK
580-351-0333                 580-355-1539              580-255-1117         580-482-2314

ELECTRONIC PAYMENTS

         Most member transactions are received and processed electronically. It is essential that
the transactions be received and processed daily as members can access their funds through
ATMs, debit cards, electronic transfers, and share drafts. There are 3 scenarios in which the
ability to receive and process these transactions can be interrupted.

Power Loss at Main Office

       If a generator is brought on site, a PC and monitor will be connected for use in receiving
and processing electronic payments.

Internet connectivity lost at Main Office

        The home of the Electronic Payments Coordinator has power and Internet connectivity.
The Chief Operations Officer will notify Catalyst Corporate FCU (800-442-5763) that the EPC
is working off site and authorize the IP address of her home computer, or a credit union
computer at her home. The EPC will download ACH and share draft files from the Corporate,
transfer them to a USB drive, and then come to the credit union and process the transactions
using a stand-by PC on generator power.

Internet Connectivity lost in Wichita Falls

       If both power and Internet connectivity are lost in Wichita Falls, The Federal Reserve
Bank of Dallas must be notified (214-922-5430) and advised that the credit union is not able to
receive and process electronic payments and checks. A waiver on the deadline for returning
unpaid debits and checks must be requested.
       The President may authorize that a remote site be set up in a nearby town that has power
and Internet connectivity. If this is done, the Chief Operations Officer will notify Catalyst
Corporate FCU (800-442-57693) that the EPC is working off site and authorize the IP address

                                              [16]
from which she is accessing the ACH and share draft files. The EPC will download ACH and
share draft files from the Corporate, transfer them to a USB drive, and then come to the credit
union and process the transactions using a stand-by PC on generator power.

CATASTROPHIC CONDITIONS

        When catastrophic conditions exist and the main office is in an area that is quarantined by
authorities, the President or his representative will contact the City Emergency Office (940-761-
6870) and request permission and necessary documents allowing generators and essential staff to
access the building to perform essential and legally required processes.

TESTING OF THE PLAN

       The President will have a test of this plan made within 90 days of its adoption by the
Board of Directors and once in every 3 calendar years thereafter. This test shall at minimum:
   1. Cause an electricity generator(s) to be brought to the credit union, connected to essential
       computer equipment as identified above, and run said equipment on generator power for
       at least 30 minutes.
   2. The Electronic Payments Coordinator will use a computer on generator power to receive
       and process either ACH transactions or share drafts, or both.
   3. The Electronic Payments Coordinator will access Catalyst Corporate FCU from her home
       computer as described above and bring the ACH and/or share draft files to the credit
       union to be processed on her workstation computer.

        This plan will also be tested in the event of the turnover of employees in critical positions
such as the Chief Operations Officer, IT Manager, or Electronic Payments Coordinator. The test
will take place in six months of a new employee taking one of these positions. This test may be
substituted for a 3-year test if it takes place within one year of the next scheduled 3-year test.




                                                [17]
 CRITICAL VENDORS AND RELATIONSHIPS

TEXAS CREDIT UNION DEPARTMENT
Function:  Regulator
Telephone: 512-837-9236
Contact:   Brandon McDaniel
Email:     tx11@ncua.gov
Address:   914 East Anderson Lane, Austin, TX 78752-1699


NCUA REGION IV DIRECTOR
Function:  Federal Insurer
Telephone: 512-342-5600
Contact:   C. Keith Morton, Director
Email:     region4@ncua.gov
Address:   4807 Spicewood Spring Road, Suite 5200, Austin, TX 78758-8400


WICHITA FALLS POLICE DEPARTMENT
Function:  Police Department
Telephone: 911
Contact:   N/A
Email:     N/A
Address:   N/A


WICHITA FALLS FIRE DEPARTMENT
Function:  Fire Department
Telephone: 911
Contact:   N/A
Email:     N/A
Address:   N/A


FEDERAL BUREAU OF INVESTIGATION
Function:  Federal Crimes
Telephone: 940-766-4441
Contact:   N/A
Email:     N/A

                                  [18]
Address:     2301 Kell Blvd., Suite 220


CATALYST CORPORATE FEDERAL CREDIT UNION
Function:  Payment Processing
Telephone: 817-944-2441
Contact:   Steve Lynam
Email:     slynam@catalystcorp.org
Address:   6801 Parkwood Boulevard, Plano, TX 75024


COMPUTER MARKETING CORPORATION (CMC)
Function:  Mainframe Computer Provider
Telephone: 800-262-3539
Contact:   Dave Erickson
Email:     dave.erickson@cmcflex.com
Address:   8520 S. Sandy Parkway, Sandy, UT 84070


CUNA MUTUAL GROUP
Function:  Business Insurer
Telephone: 800-356-2644 XT 4073
Contact:   Stephen Perry
Email:     steve.perry@cunamutual.com
Address:   4950 Amon Carter Blvd., Fort Worth, TX 76155


TEXAS CREDIT UNION LEAGUE
Function:  Trade Association
Telephone: 800-442-5762 XT 6829
Contact:   Greg Robertson
Email:     grobertson@tcul.coop
Address:   4455 LBJ Freeway, Farmers Branch, TX 75244


VANTIV
Function:    ATM and Debit Card Processor
Telephone:   513-900-4652
Contact:     Barbara Deal
Email:       barbaraA.deal@vantiv.com


                                    [19]
Address:     8500 Governors Hill Drive, 1GH1Y1, Cincinnati, OH 45249

AMERICAN NATIONAL BANK
Function:  Vault Cash Supplier
Telephone: 940-397-2323 or 2301
Contact:   Candy
Email:     candy@amnat.com
Address:   2732 Midwestern Parkway, Wichita Falls, TX 76308


RAY CANNEDY ARMORED SERVICE
Function:  Armored Car Service
Telephone: 940-322-3852
Contact:   Mary or Brandy
Email:     cansecure@cannedysecurity.com
Address:   1912 Kemp, Wichita Falls, TX 76309


FEDERAL RESERVE BANK of DALLAS
Function:  First Level Electronic Transaction Processing
Telephone: 214-922-5430
Contact:   Austin Appleby
Email:     Austin.appleby@dal.frb.org
Address:   2200 N Pearl Street, Dallas, TX 75201


FEDERAL HOME LOAN BANK
Function:  Wholesale Lending Source
Telephone: 214-441-8420
Contact:   Kevin Kogucz
Email:     Kevin.kogucz@fhlb.com
Address:   8500 Freeport Parkway South, Suite 100, Irving, TX 75063-2547


WEBFIRE COMMUNICATIONS
Function:  Telephone and Surveillance Provider
Telephone: 940-691-7577
Contact:   Ripley Tate
Email:     rt1@wf.net
Address:   3406 McNeal, Wichita Falls, TX 76308


                                    [20]
COMMERCIAL & INDUSTRIAL ELECTRONICS
Function:  Alarm Company
Telephone: 940-767-5601
Contact:   Brad Mayberry
Email:     N/A
Address:   5019 Bonny Drive, Wichita Falls, TX 76302-5299


DIEBOLD
Function:    Drive In Teller System
Telephone:   800-DIEBOLD, relevant menu option
Contact:     Must have site ID: 001953860
Email:       N/A
Address:     N/A


DIEBOLD
Function:    ATM Maintenance
Telephone:   800-DIEBOLD, relevant menu option
Contact:     Must have site ID: 001953860
Email:       N/A
Address:     N/A


NET ESSENTIALS
Function:  Internet Connection - PRIMARY
Telephone: 940-767-6387
Contact:   Cameron Deal
Email:     cdeal@netess.net
Address:   705 8th Street, Wichita Falls, TX 76301


WEBFIRE COMMUNICATIONS
Function:  Internet Connection - SECONDARY
Telephone: 940-691-7577
Contact:   Ripley Tate
Email:     rt1@wf.net
Address:   3406 McNeal, Wichita Falls, TX 76308



                                   [21]
CRANE-WEST
Function:  Website Provider
Telephone: 940-691-2111
Contact:   Colt West
Email:     colt@crane-west.com
Address:   4245 Kemp Blvd. #815, Wichita Falls, TX 76308


HUDSON ELECTRIC SERVICES, LLC
Function:  Electric Utility
Telephone: 866-483-7667
Contact:   N/A
Email:     N/A
Address:   P.O. Box 142109, Irving, TX 75014


CITY OF WICHITA FALLS
Function:  Water Utility
Telephone: 940-761-7141
Contact:   N/A
Email:     N/A
Address:   P.O. Box 1440, Wichita Falls, TX 76307-7532


ATMOS
Function:    Natural Gas Utility
Telephone:   888-286-6700
Contact:     N/A
Email:       N/A
Address:     P.O. Box 79011, St. Louis, MO 63179


ABSOLUTE COMFORT
Function:  Heating & Air Conditioning Contractor
Telephone: 940-636-5210
Contact:   Billy Samuels
Email:     absolutecomfort@att.net
Address:   P.O. Box 4784, Wichita Falls, TX 76308



                                  [22]
FIS
Function:    Bill Pay, Chex System
Telephone:   800-689-8955 XT 2213
Contact:     Ron Warren
Email:       ron.warren@fisglobal.com
Address:     N/A


BANC VUE
Function:    Checking
Telephone:   405-833-3673
Contact:     Clarke Farmer
Email:       Clarke.farmer@bancvue.com
Address:     4516 Senton Center Parkway, Austin, TX 78759


HARLAND CLARKE
Function:  Checks
Telephone: 816-279-1491
Contact:   Jo Babish
Email:     jo.babish@harlandclarke.com
Address:   N/A


MERIDIAN LINK
Function:  Cross Sales/Lending
Telephone: 714-708-6950 XT 2360
Contact:   Joe Morgan
Email:     joem@meridianlink.com
Address:   1124 Bristol Street, Costa Mesa, CA 92626

MONEY DESKTOP
Function:  PFM
Telephone: 801-660-5653
Contact:   Shane Mount
Email:     shane.mount@moneydesktop.com
Address:   251 River Park Drive, Provo, UT




                                  [23]
                    BUSINESS IMPACT ANALYSIS

       The vital member services and high impact events have been identified as the following.
Scenarios for each potential failure event have been identified and analyzed to determine
duration, potential for happening, and criticalness.



                             POTENTIAL FAILURE EVENTS


CASH SERVICES

ELECTRONIC PAYMENTS

OPENING ACCOUNTS

LENDING

MANAGEMENT/BOARD OF DIRECTORS

PHYSICAL DISASTER




                                            [24]
                               BUSINESS IMPACT ANALYSIS

FAILURE EVENT: CASH SERVICES

 FAILURE
                       DEPENDENCY                           DURATION      PROBABILITY   CRITICALITY
SCENARIO
            Failure to wire funds to ANB for
            vault cash shipment or the
    1                                                      Short-term         2             3
            amount wired is less than what is
            needed
            Armored Car is robbed and the
    2       credit union’s cash shipment is                Short-term         1             3
            stolen
            ANB is robbed and is unable to
    3       fill the credit union’s vault cash             Short-term         2             3
            shipment
            The credit union is robbed and all
    4                                                      Short-term         2             2
            vault cash has been stolen
            One of the credit union’s offices
    5       is closed and unable to offer cash             Short-term         3             1
            services to members
            Both of the credit union’s offices
    6       are closed and unable to offer                 Intermediate       1             5
            cash services to members
            50% or more tellers are unable to
    7       work due to illness, sick-out,                 Immediate          2             2
            unauthorized strike, or other
            City-wide power failure or a
            mainframe computer is disabled
    8                                                      Intermediate       2             5
            so that the credit union does not
            have access to members’ accounts
            Total failure of all the credit
    9                                                      Intermediate       1             1
            union’s ATMs.
            Total failure of all ATMs of all
   10       financial institutions in Wichita              Intermediate       1             1
            Falls.
            Total failure of all regional, state,
   11                                                      Intermediate       1             2
            or national ATM systems
   12       A run on the credit union                      Immediate          1             3

Duration:     Immediate    One day or less
              Short-term   One to three business days
              Intermediate Four to ten business days

                                                    [25]
               Long-term      Greater than ten business days

Probability:   1 Very little probability
               2 Less than likely to occur
               3 Possible but not likely to occur
               4 Reasonable chance to occur
               5 Most likely to occur

Criticality:   1 Least serious
               2 Less serious
               3 Serious but very manageable
               4 Very serious
               5 Most serious




                                               [26]
                                      CASH SERVICES
                                BUSINESS IMPACT ANALYSIS
                                  IN ORDER OF SEVERITY


OVERVIEW

         Access to cash is a paramount concern of consumers in any event where banking services
have been interrupted. While consumers may prefer to make payments on-line, with debit cards,
or with checks, cash will always be the fall-back method of payment when a disaster or other
business disruption would make electronic payments impossible. In considering any disaster or
business disruption scenario, making cash services available to its members will always be the
first service brought on line as soon as practical.
         Management has identified twelve scenarios where cash services might be interrupted or
curtailed in some manner. These scenarios are listed in a balanced order of criticality and
probability where the impact on the credit union would be more serious.

1. CITY-WIDE POWER FAILURE

       Probability:    2 Less than likely to occur
       Criticality:    5 Most serious


        A city-wide power failure can be the result of several different natural or man-caused
events. A tornado, wind storm, or ice storm bring down power lines across the city or in the
vicinity of the credit union, disrupting the power supply for several days while utility crews
make the necessary repairs. An automobile can impact a power pole and disrupt the power
supply for a day or two until repairs have been made.
        We rate the probability as 2, less likely to happen. Wichita Falls has a serious tornado
event in its history and it is liable for another event to happen but the statistical chance of that
happening is fairly low. Ice storms happen at least once during the winter. The chance of a city-
wide loss of electrical power from downed lines is remote, but local outages are more probable.
        The loss of electrical power is very critical to the operation of the credit union as all
member service applications are computerized. A sustained loss of power would involve
resorting to manual operations for cash services.
        Fortunately, power crews are dedicated and highly trained to deal with a disaster of this
magnitude. Also, crews from across the state and the nation respond to give aid to local crews
when major disasters hit a community. We believe that a city-wide loss of power from a major
event, such as a tornado, would be of intermediate duration and that electrical power would be
restored within four to ten business days.

2. BOTH OFFICES ARE CLOSED

       Probability:    1 Very little probability
       Criticality:    5 Most serious



                                                   [27]
        We believe that the probability that both offices of the credit union would be closed and
inaccessible to members is highly unlikely. The offices are far enough apart so that a tornado
would not hit both buildings. A blizzard or ice storm and possibly city-wide flooding are about
the only events that could result in the simultaneous closing of both offices. Such closing would
be due to the inability of employees to travel to an office and would be only for the duration of
the event. Also, if employees are not able to come to an office, it is most likely that members will
not be able to come to the office.
        While the probability of such an event is unlikely, if it happened it would be very critical
if the membership was able to function and carry on normal personal business. While we view
this as very critical, we strongly believe that under such circumstances our members would not
be carrying on normal personal business during the event.

3. RUN ON THE CREDIT UNION

       Probability:    1 Very little probability
       Criticality:    3 Serious but very manageable

       A run on the credit union would happen as part of a run on all financial institutions or
because of a report of a serious financial problem with the credit union—whether true or not.
       We view this as highly improbable as far as the reputation of the credit union is
concerned, but bad economic news or massive simultaneous failures among banks could trigger a
run.
       A run on the credit union, for any reason, would be very critical as it would force the
temporary closing of the credit union and keep members from making transactions in person
temporarily.
       A run on the credit union would be of very short duration, probably only one day, until
panic subsides.

4. FAILURE TO WIRE FUNDS TO ANB FOR VAULT CASH

       Probability:    2 Less than likely to occur
       Criticality:    3 Serious but very manageable

        The credit union obtains its vault cash through American National Bank in Wichita Falls.
Money is wired weekly from the credit union’s account at Catalyst Corporate FCU to American
National Bank and then shipped from the bank to the credit union by armored car. Head tellers
submit their vault cash requests to the wire transfer department where the transfer request is
entered into the TranZact wire transfer application. If the transfer is not made or if it is made for
a lesser amount that requested by the head tellers, American National Bank will ship only the
amount of cash it receives in the transfer. The failure to receive the vault cash restricts the
amount of cash tellers have available to service members’ cash withdrawals.
        The probability of a failure to wire funds is less than likely although there have been
times when an incorrect amount has been wired to the bank.
        The criticality of this event is median. The branches can share vault cash and it is
possible to get small amounts of cash from other institutions to support the cash operation.

                                                [28]
        The duration of this event is deemed to be short-term and can be resolved within three
days. The only impediment to a quicker solution would be the amount of vault cash on hand at
American National Bank. (The bank places its cash order from FRB considering the amount we
order from them.)

5. AMERICAN NATIONAL BANK IS ROBBED

       Probability:    2 Less than likely to occur
       Criticality:    3 Serious but very manageable

        Under this scenario it is assumed that the wire from the credit union has been received by
bank and that the cash is in the bank’s vault. The bank is robbed and it is unable to fund the
credit union’s vault cash order.
        Management considers the probability of this happening to be on par with the credit
union not sending a wire. Robberies happen, but most of the time a robbery involves only teller
cash. On rare occasions, a robbery may include vault cash, but such a robbery takes more time
than robbing a teller and puts the robber(s) at greater risk to capture.
        The criticality is equal to that of the failure to wire the vault cash order to the bank. The
credit union would have to share cash between the branches and/or obtain cash from some other
financial institutions until American National Bank would have enough cash to fill the vault cash
order.
        This event would be of short duration and overcome within one to three days.

6. THE ARMORED CAR IS ROBBED

       Probability:    1 Very little probability
       Criticality:    3 Serious but very manageable

        The credit union’s vault cash order is transported from American National Bank to its
offices by armored car. There is a possibility that the armor car could be robbed and the cash
stolen. With the cash removed from the vault of American National Bank, the bank would not
have sufficient cash on hand to refill the order. The loss would be covered by the armored car’s
insurer but the payment would be available to replenish the delayed cash order.
        Management believes that this event is highly improbable although it recognizes that it is
possible.
        Management places a mid-level critical value on such an event due to the remote
possibility of this happening. However, should such a robbery take place, the challenges in
obtaining the amount of vault cash needed are exactly the same as other vault cash order failures.

7. THE CREDIT UNION’S VAULT IS ROBBED

       Probability:    2 Less than likely to occur
       Criticality:    2 Less serious




                                                [29]
         The credit union’s vaults contain cash to fund teller transactions and to refill ATMs. This
is a considerable amount of money, but it is kept in locked safes that are not in areas accessible
to the public. Furthermore, vault cash is divided between the vaults of both offices.
         It is less than likely that a robber would try to rob a vault because of the time involved in
doing so would put him in jeopardy of being apprehended. The credit union has experienced one
robbery so far in its life, so management understands that a robbery is possible and because of
that it recognizes that a robber could decide to rob a vault.
         Management views this as a mid-level critical event as the vault cash is divided between
the branch offices and the vault cash could be shared until the next cash shipment is received; or,
some cash could be obtained from local financial institutions to help replenish the cash
sufficiently to meet withdrawal demands.

8. 50% OR MORE TELLERS UNABLE TO REPORT FOR WORK

       Probability:    2 Less than likely to occur
       Criticality:    2 Less serious

        Tellers are the most important staff for providing cash services to members. If the teller
staff was depleted due to illness, a “sick-out,” or strike the ability of the credit union to service
members’ requests for cash would be seriously curtailed.
        Management believes that massive illness among tellers at one time, while possible, is
relatively unlikely. The tellers are not unionized, so a strike is highly unlikely but it is recognized
that a discontented teller line could hamper operations with a “sick-out.” Inasmuch as this would
carry serious consequences for their continued employment with the credit union, a “sick-out” is
deemed to be highly unlikely.
        The loss of most of the tellers for any reason would be very disruptive to the operation of
the credit. However, tellers are routinely promoted to other positions within the credit union
which has the result of having a significant number of employees with teller experience who
could handle teller transactions until the situation is resolved. For this reason, it is believed that
this event has low critical impact on the credit union.

9. ONE OF THE CREDIT UNION OFFICES IS CLOSED

       Probability:    3 Possible but not likely to occur
       Criticality:    1 Least serious

        An isolated power failure, communications failure, or weather event might make it
impossible to operate one of the credit union’s offices for one to three days. Management
considers this event to be possible but of low criticality as business from the closed office can be
redirected to the other office.

10. TOTAL FAILURE OF ATM NETWORKS NATIONALLY

       Probability:    1 Very little probability
       Criticality:    2 Less serious



                                                   [30]
       The possibility of a total failure of ATM networks nationally, while possible, is so remote
that management considers it to be highly improbable. If such an event took place, it would be
mildly critical as members could obtain cash from the credit union or at POS locations. Members
that would feel the impact of this event the most are those that live out of the immediate area and
are unaware that they can obtain cash through a POS location.

11. TOTAL FAILURE OF ALL ATMS IN WICHITA FALLS

       Probability:   1 Very little probability
       Criticality:   1 Least serious

       This event is more likely than a national failure but is still highly unlikely to happen.
Management realizes that a tornado or like disaster could disable all local ATMs. Management
believes that this is not a critical event because the credit union can still service members’ cash
needs on the teller line.

12. FAILURE OF ALL THE CREDIT UNION’S ATMS

       Probability:   1 Very little probability
       Criticality:   1 Least serious

       It is possible for the ATM network to be down, but such events are usually sort lived.
This has a low probability of happening. Management believes this has low criticality because
members can obtain cash through other ATMs, POS locations, or at the teller line.




                                                  [31]
                               BUSINESS IMPACT ANALYSIS

FAILURE EVENT: ELECTRONIC PAYMENTS

  FAILURE
                         DEPENDENCY                        DURATION      PROBABILITY   CRITICALITY
 SCENARIO
               Illness or prolonged absence of
     1                                                    Long-term          2             5
               primary employee
               Illness or coincidental absence
     2         of secondary electronic                    Intermediate       1             5
               payments employee
               Loss of Internet connectivity
     3         resulting in inability to receive          Short-term         2             5
               files
               Disaster at Catalyst Corp FCU
     4         wherein they cannot receive and            Short-term         3             5
               send files
               Disaster at Vantiv wherein they
     5         cannot receive and/or send                 Immediate          2             4
               ATM/Debit card transactions
               Communication from the credit
     6                                                    Short-term         2             3
               union to Vantiv is disabled
               Loss of the credit union’s
               mainframe computer making it
     7                                                    Short-term         2             3
               impossible to update members’
               accounts
               Branch capture (Check 21)
               cannot be transmitted due to
     8                                                    Short-term         2             3
               scanner failure or Internet
               failure

Duration:      Immediate       One day or less
               Short-term      One to three business days
               Intermediate    Four to ten business days
               Long-term       Greater than ten business days

Probability:   1 Very little probability
               2 Less than likely to occur
               3 Possible but not likely to occur
               4 Reasonable chance to occur
               5 Most likely to occur

Criticality:   1 Least serious
               2 Less serious
               3 Serious but very manageable
               4 Very serious
               5 Most serious

                                                   [32]
                                 ELECTRONIC PAYMENTS
                               BUSINESS IMPACT ANALYSIS
                                 IN ORDER OF SEVERITY


OVERVIEW

         More member transactions are processed electronically than by any other method. ACH
payments and share draft have been with us a long time but now we have debit cards and bill-pay
transactions that constitute a significant portion of electronic payments. Electronic payments
methodologies allow for this overwhelmingly significant amount of transactions to be handled be
just one or two employees and a few third-party vendors.
         Members are dependent upon electronic payments for most of their transactions: payroll
and retirement income, utility payments, loan payments, and routine purchases. Because of the
volume of transactions and the small number of employees and vendors involved in the
electronic payments process it is one of the most vulnerable applications of the credit union’s
operations.
         Management has identified eight scenarios where electronic payments might be
interrupted or curtailed in some manner. These scenarios are listed in a balanced order of
criticality and probability where the impact on the credit union would be more serious.

1. DISASTER AT CATALYST CORPORATE FCU

       Probability:   3 Possible but not likely to occur
       Criticality:   5 Most serious

        The credit union is wholly dependent upon Catalyst Corporate FCU for its ability to
receive ACH and share draft files. If the Corporate is unable to receive files from the Federal
Reserve Bank and make them available to the credit union members will not have electronic
deposits posted and the liability from unposted debits or share drafts could be significant.
        Management assesses this event with a mid-level of probability. Tornado, fire, computer
failure are reasons why the Corporate might experience a disaster. The Corporate could also be
victimized by terrorist activity since the consolidation of several corporate credit unions has
made Catalyst a major transaction processor for credit unions across the United States. The
probability of a disaster at the Corporate is higher than a similar disaster at the credit union.
        Such a disaster would be extremely critical to the credit union’s ability to service
members’ financial needs. Automatic deposits would stop, debit card settlements could not be
processed, share drafts could not be processed, and outgoing cash letters could not be processed
all making the financial exposure of the credit union significant.
        Recognizing the dependence that credit unions across the country have on the Corporate,
Catalyst has a business continuity plan that address the vulnerabilities mentioned above.
Management believes that the duration of such a catastrophe would be of short-term duration,
with the Corporate bringing its services on line within one to three business days.

2. LOSS OF INTERNET CONNECTIVITY

                                              [33]
       Probability:    2 Less than likely to occur
       Criticality:    5 Most serious

         Virtually all electronic payments are dependent on the Internet for communication from
institution to institution. A loss of Internet connectivity would prevent the receiving and
transmission of critical data for all electronic payments processed by the credit union.
         Because American business is so dependent on the Internet, a great deal of redundancy
has been built into Internet services so that a failure in one phase triggers a backup response that
keeps the system running. Denial of service attacks have been waged against some businesses
and government agencies, but these are usually discovered and controverted quickly. These
factors cause management to believe that the failure of Internet connectivity is of a low
probability and the loss of connectivity would be short-term in nature.

3. PROLONGED ABSENCE OF PRIMARY EMPLOYEE

       Probability:    2 Less than likely to occur
       Criticality:    5 Most serious

         One employee of the credit union processes all electronic payments. This employee’s
prolonged absence through illness or for other would have an extremely critical impact on the
credit union. This would also be of a long-term duration, which amplifies its critical nature.
         Management knows that this can happen because it has experienced the long-term
absence of its Electronic Payments Coordinator. Management has a backup employee in place to
fill in during the absence of the primary employee and now rates the probability at less than
likely that the position would be vacated during a prolonged absence of the primary employee.
         The absence of a highly qualified employee in the electronic payments function is
extremely critical.

4. PROLONGED ABSENCE OF SECONDARY EMPLOYEE

       Probability:    1 Very little probability
       Criticality:    5 Most serious

       One employee of the credit union process all electronic payments. The absence of both
the primary and secondary employee at the same time has a very low probability of happening.
For both employees to be unable to process electronic payments is extremely critical.

5. DISASTER AT VANTIV

       Probability:    2 Less than likely to occur
       Criticality:    4 Very serious

        Vantiv is the ATM and debit card processor. The use of ATM and debit cards to obtain
cash and make payments is increasing. They are also highly efficient transactions as they are
fully automated and only need an employee to reconcile batch totals.

                                                   [34]
         The probability of a disaster at Vantiv is fairly low and, as with the corporate credit
union, their disaster recovery program would immediately come into play restoring service
probably within 24 hours.
         The ability for Vantiv to process these transactions is critical for our members, but less
critical than ACH payments. Members’ inability to make an ATM withdrawal or to process a
debit card payment would be inconvenient but short lived.

6. COMMUNICATION WITH VANTIV IS DISABLED

       Probability:    2 Less than likely to occur
       Criticality:    3 Serious but very manageable

        In this event, Vantiv is still operative but the communication between Vantiv and the
credit union has been disabled. Vantiv would be in “stand-in” mode and members would be able
to make ATM withdrawals or debit card transactions up to the “stand-in” thresholds.
        There are occasional disruptions with this communication, but only of short durations.
The scenario management envisions here is for one to three business days, which has a low
probability of happening.
        Management considers this event to be of medium criticality as members can still make
ATM withdrawals and use their debit cards. The more serious part of this event is the liability for
transactions that may not be covered by sufficient funds when they are finally processed.

7. LOSS OF CREDIT UNION’S MAINFRAME COMPUTER

       Probability:    2 Less than likely to occur
       Criticality:    3 Serious but very manageable

       If the credit union’s mainframe computer fails, no electronic payments can be processed
from whatever the sources. Redundancies exist to minimize the probability of this event, so
management views the event to have a low probability.
       Management gives this event a medium criticality level because of the short-term
duration. If a total failure happens, a new mainframe will be delivered and brought on line within
three business days. Members would still be able to make ATM withdrawals and use their debit
cards as Vantiv would be in “stand-in” mode. Cash services would still be available to members.
The greatest difficulty would come from not being able to post ACH transactions or share drafts.

8. BRANCH CAPTURE FAILURE

       Probability:    2 Less than likely to occur
       Criticality:    3 Serious but very manageable

        Branch capture is the methodology by which cash letter forwarding takes place. Checks
received on the teller line are scanned and transmitted to the corporate credit union. The inability
to transmit these cash letters begins to reduce the cash balance of the cash management fund at
the corporate credit union.



                                               [35]
         Failures of either the physical scanner or its software have happened but these failures are
relatively rare. Management gives this a low probability of occurring with a medium level of
criticality.
         Repairs are made quickly and in the event a scanner cannot be repaired it can be replaced
within one to three business days.




                                                [36]
                                 BUSINESS IMPACT ANALYSIS

FAILURE EVENT: OPENING ACCOUNTS

 FAILURE
                          DEPENDENCY                     DURATION      PROBABILITY   CRITICALITY
SCENARIO
               One of the credit union’s offices is
    1          closed and unable to open accounts       Short-term         3             1
               for new members
               Both of the credit union’s offices
    2          are closed and unable to open            Intermediate       1             3
               accounts for new members
               50% or more MSRs are unable to
    3          work due to illness, sick-out,           Intermediate       3             2
               unauthorized strike, or other
               City-wide power failure or a
               mainframe computer is disabled so
    4                                                   Intermediate       2             1
               that the credit union does not have
               access to members’ accounts

Duration:        Immediate      One day or less
                 Short-term     One to three business days
                 Intermediate   Four to ten business days
                 Long-term      Greater than ten business days

Probability:     1 Very little probability
                 2 Less than likely to occur
                 3 Possible but not likely to occur
                 4 Reasonable chance to occur
                 5 Most likely to occur

Criticality:     1 Least serious
                 2 Less serious
                 3 Serious but very manageable
                 4 Very serious
                 5 Most serious




                                                 [37]
                                   OPENING ACCOUNTS
                                BUSINESS IMPACT ANALYSIS
                                  IN ORDER OF SEVERITY


OVERVIEW

       Opening accounts is something the credit union does every day. It would not greatly
impact the credit union’s business if it were unable to open accounts for two or three days. What
would affect the credit union is if it were not able to open accounts for a longer period of time
and particularly if other financial institutions have been affected by the same event and their
customers wanted to move their business to the credit union but were unable to open accounts.

1. BOTH CREDIT UNION OFFICES ARE UNABLE TO OPEN

       Probability:    2 Less than likely to occur
       Criticality:    5 Most serious

        There is a very low probability of both offices being closed. However, should both
offices be closed or unable to open for business it would be a very critical event.
        Management believes that this would be only of immediate duration and arrangements to
open to the public would be in place within one business day.

2. 50% OF MSRs UNABLE TO WORK

       Probability:    3 Possible but not likely to occur
       Criticality:    2 Less serious

        There are fewer MSRs than tellers, so the levels of probability and criticality are a little
higher than for the tellers.
        Many of the credit union’s employees have worked as MSRs as their careers progressed,
so there is a cadre of employees that could fill in during a mass illness or other mass absence of
MSRs.

3. ONE OF THE CREDIT UNION’S OFFICES IS CLOSED

       Probability:    3 Possible but not likely to occur
       Criticality:    1 Least serious

        A power failure or inclement weather could force the closing of one of the credit union’s
office. There is a reasonable probability that this could happen because it has happened on rare
occasions. Management views this event as having very low criticality because members will be
redirected to the office that is open.

4. CITY-WIDE POWER FAILURE OR MAINFRAME COMPUTER FAILURE



                                               [38]
       Probability:    3 Possible but not likely to occur
       Criticality:    1 Least serious

        The inability for MSRs to access the mainframe computer because of a power failure or
the failure of the computer would keep them from being able to enter new accounts on to the
system.
        There is reason to believe this could happen but the level of criticality is very low as the
MSRs can accept signature cards and deposits to open accounts manually and then enter the
accounts on to the system when it is available.




                                               [39]
                                 BUSINESS IMPACT ANALYSIS

FAILURE EVENT: LENDING SERVICES

 FAILURE
                          DEPENDENCY                     DURATION      PROBABILITY   CRITICALITY
SCENARIO
               One of the credit union’s offices is
    1          closed and unable to open accounts       Short-term         3             1
               for new members
               Both of the credit union’s offices
    2          are closed and unable to accept and      Intermediate       1             3
               process loans for members
               50% or more loan officers are
    3          unable to work due to illness, sick-     Intermediate       3             2
               out, unauthorized strike, or other
               City-wide power failure or a
               mainframe computer is disabled so
    4                                                   Intermediate       2             1
               that the credit union does not have
               access to members’ accounts.

Duration:        Immediate      One day or less
                 Short-term     One to three business days
                 Intermediate   Four to ten business days
                 Long-term      Greater than ten business days

Probability:     1 Very little probability
                 2 Less than likely to occur
                 3 Possible but not likely to occur
                 4 Reasonable chance to occur
                 5 Most likely to occur

Criticality:     1 Least serious
                 2 Less serious
                 3 Serious but very manageable
                 4 Very serious
                 5 Most serious




                                                 [40]
                                     LENDING SERVICES
                                 BUSINESS IMPACT ANALYSIS
                                   IN ORDER OF SEVERITY

OVERVIEW

        Lending is one of the main reasons the credit union was founded. This service is vital to
members for financing the purchase of automobiles and homes and for other sundry needs of
households. Unlike cash services, lending is a service that can be taken off line for one to three
days without seriously hurting the financial needs of members. However, bringing lending
services on line a quickly as possible is in the best interest of members in the event of a disaster
that affects the entire city.

1. BOTH CREDIT UNION OFFICES ARE UNABLE TO OPEN

       Probability:    2 Less than likely to occur
       Criticality:    5 Most serious

        There is a very low probability of both offices being closed. However, should both
offices be closed or unable to open for business it would be a very critical event.
        Management believes that this would be only of immediate duration and arrangements to
open to the public would be in place within one business day.

2. 50% OF LOAN OFFICERS UNABLE TO WORK

       Probability:    3 Possible but not likely to occur
       Criticality:    2 Less serious

         There are fewer loan officers than tellers, so the levels of probability and criticality are a
little higher than for the tellers.
         One loan officer can handle the loan demand at a single office of the credit union for
several days in the event of such an emergency. 50% of the loan officers absent would leave one
loan officer for each office. The CEO and CLO have loan experience and would be able to fill in
for missing loan officers temporarily.

3. ONE OF THE CREDIT UNION’S OFFICES IS CLOSED

       Probability:    3 Possible but not likely to occur
       Criticality:    1 Least serious

        A power failure or inclement weather could force the closing of one of the credit union’s
office. There is a reasonable probability that this could happen because it has happened on rare
occasions. Management views this event as having very low criticality because members will be
redirected to the office that is open.

4. CITY-WIDE POWER FAILURE OR MAINFRAME COMPUTER FAILURE

                                                 [41]
       Probability:    3 Possible but not likely to occur
       Criticality:    1 Least serious

        The inability for loan officers to access the mainframe computer because of a power
failure or the failure of the computer would keep them from being able to book new loans on to
the system.
        There is reason to believe this could happen but the level of criticality is very low as the
loan officers can accept loan applications manually and then disburse the loans when the system
is available.




                                               [42]
                                 BUSINESS IMPACT ANALYSIS

FAILURE EVENT: EXECUTIVE MANAGEMENT/BOARD

 FAILURE
                          DEPENDENCY                    DURATION    PROBABILITY   CRITICALITY
SCENARIO
               Death or immediate removal of the
    1                                                   Long-term       2             5
               Chief Executive Officer
               Death or immediate removal of the
    2                                                   Long-term       2             4
               Chief Financial Officer
               Immediate loss of all executive
    3                                                   Long-term       1             5
               management personnel
               Immediate loss of all Board
    4                                                   Long-term       1             5
               members

Duration:        Immediate      One day or less
                 Short-term     One to three business days
                 Intermediate   Four to ten business days
                 Long-term      Greater than ten business days

Probability:     1 Very little probability
                 2 Less than likely to occur
                 3 Possible but not likely to occur
                 4 Reasonable chance to occur
                 5 Most likely to occur

Criticality:     1 Least serious
                 2 Less serious
                 3 Serious but very manageable
                 4 Very serious
                 5 Most serious




                                                 [43]
                                     MANAGEMENT
                               BUSINESS IMPACT ANALYSIS
                                 IN ORDER OF SEVERITY


OVERVIEW

        The senior management and board of directors are essential to the ongoing operation of
the credit union. It has been said that no one person can’t be replaced. While that is true, the
sudden loss of key personnel has a serious impact on an organization. The credit union has a
talented echelon of supervisors and lead employees that can carry on the necessary daily
operations without the direct guidance of senior management or the board for an extended time.
Even with this talent in place, it is essential to provide ongoing management to secure the safe
and secure operation of the credit union for the long-term.

1. IMMEDIATE LOSS OF ALL EXECUTIVE MANAGEMENT

       Probability:   1 Very little probability
       Criticality:   5 Most serious

        The probability that all management personnel could be lost or removed at the same time
is highly unlikely, but it must be recognized that there is a remote possibility that this could
happen.
        The loss of the management team would be most critical to the operation of the credit
union. While talented supervisors and lead staff could maintain the operation for a while, it is
essential that qualified managers be present to oversee the ongoing operation of the credit union.

2. IMMEDIATE LOSS OF ALL BOARD MEMBERS

       Probability:   1 Very little probability
       Criticality:   5 Most serious

        The Board of Directors is the policy making body and have the ultimate responsibility for
the credit union. It is highly unlikely that all the members of the Board would be lost or removed
at the same time, it must be recognized that there is a remote possibility that this could happen.
        A professional management team can continue the operation of the credit union
indefinitely, but it is essential for a volunteer Board be in place to give broad direction and set
and measure the goals of the organization. Without a Board of Directors, the mission of the
credit union would eventually come to an end.

3. LOSS OF CHIEF EXECUTIVE OFFICER

       Probability:   2 Less than likely to occur
       Criticality:   5 Most serious




                                                  [44]
         The Chief Executive Officer is responsible for the over-all daily operation of the credit
union. This is a highly qualified individual, well versed in every function of the credit union and
capable of guiding its tactical affairs. The CEO could be lost suddenly due to death, serious
illness, or removal from office. The probability of this is below a median level of occurrence.
         The CEO is extremely important, but he/she is not most important as department heads
can continue the operation of the credit union without the CEO being present. However, the loss
of the CEO is most critical in the long-term. Someone must be in charge.

4. LOSS OF THE CHIEF FINANCIAL OFFICER

       Probability:    2 Less than likely to occur
       Criticality:    4 Very serious

        Modern laws, rules and regulations place as high a level of responsibility and liability for
an organization on the CFO as on the CEO. The CFO is responsible for the overall management
of the balance sheet, accounting function, and investments. It is the interpretation of balance
sheet trends that gives guidance to other department leaders. The CFO could be lost suddenly
due to death, serious illness, or removal from office. The probability of this is below a median
level of occurrence.
        The CFO is very important but the loss of the CFO is not quite as severe as the loss of the
CEO. Accounting and finance staff can continue those functions without the CFO being present
and management can continue balance sheet strategies temporarily without the CFO. But the
long-term absence of a CFO would be very critical to the operation of the credit union.




                                               [45]
                                 BUSINESS IMPACT ANALYSIS

FAILURE EVENT: PHYSICAL DISASTER

 FAILURE
                          DEPENDENCY                     DURATION      PROBABILITY   CRITICALITY
SCENARIO
               Main office destroyed by tornado,
    1                                                   Long-term          3             4
               fire or other disaster
               City-wide destruction from tornado
    2          or other disaster but credit union       Intermediate       3             4
               main office not damaged
    3          Ice storm                                Immediate          2             2
    4          Blizzard                                 Immediate          1             2
    5          Flood                                    Immediate          1             2
    6          Utility failure at main office           Short-term         2             2

Duration:        Immediate      One day or less
                 Short-term     One to three business days
                 Intermediate   Four to ten business days
                 Long-term      Greater than ten business days

Probability:     1 Very little probability
                 2 Less than likely to occur
                 3 Possible but not likely to occur
                 4 Reasonable chance to occur
                 5 Most likely to occur

Criticality:     1 Least serious
                 2 Less serious
                 3 Serious but very manageable
                 4 Very serious
                 5 Most serious

                     The General Business Continuity Plan applies for all scenarios.




                                                 [46]
     BUSINESS CONTINUITY ACTION STEPS


PART 1 – CASH SERVICES

Scenario 1 – Failure to wire funds to ANB
Scenario 2 – Armored car is robbed in transit
Scenario 3 – ANB has been robbed and is unable to fill the credit union’s cash shipment
Scenario 4 – The credit union has been robbed and vault cash is stolen
Scenario 5 – One of the credit union’s offices is closed and unable to offer cash services
Scenario 6 – Both credit union offices are closed and unable to offer cash services
Scenario 7 – 50% or more tellers are unable to work
Scenario 8 – City-wide power failure or mainframe computer disabled
Scenario 9 – Total failure of all the credit union’s ATMs
Scenario 10 – Total failure of all ATMs of all Wichita Falls financial institutions
Scenario 11 – Total failure of all regional, state, or national ATM systems
Scenario 12 – A run on the credit union

PART 2 – ELECTRONIC PAYMENTS

Scenario 1 – Prolonged illness or absence of primary electronic payments employee
Scenario 2 – Coincidental prolonged absence of secondary electronic payments employee
Scenario 3 – Loss of Internet connectivity and inability to receive electronic files
Scenario 4 – Disaster at Catalyst Corp. FCU
Scenario 5 – Disaster at Vantiv
Scenario 6 – Communication from the credit union TO Vantiv is disabled
Scenario 7 – Loss of credit union’s mainframe computer; unable to update members’
               accounts
Scenario 8 – Branch Capture cannot be transmitted

PART 3 – OPENING ACCOUNTS

Scenario 1 – One of the credit union’s offices is closed and unable to open accounts
Scenario 2 – Both credit union offices are closed and unable to offer cash services
Scenario 3 – 50% or more MSRs are unable to work
Scenario 4 – City-wide power failure or mainframe computer disabled



                                       [47]
PART 4 – LENDING

Scenario 1 – One of the credit union’s offices is closed and unable to offer lending
               services
Scenario 2 – Both credit union offices are closed and unable to offer lending services
Scenario 3 – 50% or more loan officers are unable to work
Scenario 4 – City-wide power failure or mainframe computer disabled

PART 5 – MANAGEMENT/BOARD

Scenario 1 – Loss of Chief Executive Officer
Scenario 2 – Loss of Chief Financial Officer
Scenario 3 – Immediate loss of all executive management personnel
Scenario 4 – Immediate loss of all Board members

PART 6 – PHYSICAL DISASTER

All Scenarios
Scenario 1 – Main office destroyed by tornado, fire or other disaster
Scenario 2 – City-wide destruction but credit union main office not damaged
Scenario 3 – Ice Storm
Scenario 4 – Blizzard
Scenario 5 – Flood
Scenario 6 – Utility failure at main office




                                      [48]
PART 01 EVENT 01
FAILURE EVENT: CASH SERVICES
SCENARIO:        01 Failure to wire funds to ANB

In the event that funds are not wired from the corporate credit union to ANB for vault cash. This
event is short-term with less than likely probability and considered serious but manageable.

   1. The CEO and CFO are to be notified as soon as the failure wire funds has been
      discovered.
   2. The Teller Supervisor will assess the cash position of all vaults in the credit union and
      transfer cash between the branches to help meet the demands for cash.
   3. If there is not sufficient cash available to fund the demands for cash until the next cash
      shipment, the CEO or CFO will contact local financial institutions requesting assistance.
           a. Checks will be written to each institution that will assist the credit union.
           b. The Teller Supervisor and an officer of the credit union will take the check(s) to
              the institution(s) and exchange the check(s) for cash.
           c. The cash will then be taken to both branches and placed in the cash vaults as
              needed.




                                              [49]
PART 01 EVENT 02
FAILURE EVENT: CASH SERVICES
SCENARIO:        02 Armored car is robbed in transit

This event is short-term in duration but has very little probability of occurring. It is considered
serious but manageable if it happens.

   1. The CEO and CFO are to be notified as soon as the robbery of the armored car is known.
   2. The amount of the credit union’s cash shipment is insured but the money will not be
      available to the credit union until the robbery is settled by the armored car company’s
      insurance company.
   3. The Teller Supervisor will assess the cash position of all vaults in the credit union and
      transfer cash between the branches to help meet the demands for cash.
   4. If there is not sufficient cash available to fund the demands for cash until the next cash
      shipment, the CEO or CFO will contact local financial institutions requesting assistance.
           a. Checks will be written to each institution that will assist the credit union.
           b. The Teller Supervisor and an officer of the credit union will take the check(s) to
              the institution(s) and exchange the check(s) for cash.
           c. The cash will then be taken to both branches and placed in the cash vaults as
              needed.
   5. The CFO will have the amount of the cash shipment removed from the general ledger
      cash account and transferred to an accounts receivable account until the insurance
      settlement has been received.




                                                [50]
PART 01 EVENT 03
FAILURE EVENT: CASH SERVICES
SCENARIO:        03 ANB has been robbed and is unable to fill the credit union’s cash
                 shipment.

In the event that funds have been wired to and received by ANB and the bank has been robbed so
that there is not sufficient cash available to fill the credit union’s cash shipment. This event has a
short-term duration with a less than likely probability of happening. If it happens, it is serious to
the credit union but manageable.

   1. The CEO and CFO are to be notified as soon as the robbery of ANB is known.
   2. The amount of the credit union’s cash shipment is insured but the money will not be
      available to the credit union until the robbery is settled by the banks’s insurance
      company.
   3. The Teller Supervisor will assess the cash position of all vaults in the credit union and
      transfer cash between the branches to help meet the demands for cash.
   4. If there is not sufficient cash available to fund the demands for cash until the next cash
      shipment, the CEO or CFO will contact local financial institutions requesting assistance.
           a. Checks will be written to each institution that will assist the credit union.
           b. The Teller Supervisor and an officer of the credit union will take the check(s) to
              the institution(s) and exchange the check(s) for cash.
           c. The cash will then be taken to both branches and placed in the cash vaults as
              needed.
   5. The CFO will have the amount of the cash shipment removed from the general ledger
      cash account and transferred to an accounts receivable account until the insurance
      settlement has been received.




                                                [51]
PART 01 EVENT 04
FAILURE EVENT: CASH SERVICES
SCENARIO:        04 The credit union has been robbed and vault cash stolen

In the event the credit union has been robbed and vault cash has been stolen so that the credit
union is unable to meet demands for cash. This event is short-term in duration and has a less than
likely probability of occurring. Its criticality is less than serious with regard to the credit union’s
ability to service members.

   1. The Teller Supervisor will determine how much cash is needed until the next regular cash
      shipment will be received.
   2. The Teller Supervisor will inform the CEO and CFO of the amount of cash needed and
      they will contact local financial institutions requesting assistance.
          a. Checks will be written to each institution that will assist the credit union.
          b. The Teller Supervisor and an officer of the credit union will take the check(s) to
             the institution(s) and exchange the check(s) for cash.
          c. The cash will then be taken to both branches and placed in the cash vaults as
             needed.
   3. The CFO will have the amount of the cash stolen removed from the general ledger cash
      account and transferred to an accounts receivable account until the insurance settlement
      has been received.




                                                 [52]
PART 01 EVENT 05
FAILURE EVENT: CASH SERVICES
SCENARIO:        05 One of the credit union’s offices is closed and unable to offer cash
                 services to members.

In the event that one of the credit union’s offices is closed and unable to offer cash services to
members. This event would be of short duration and it is possible but less than likely that it could
occur. This event has the least serious criticality.

   1. A notice will be placed conspicuously at the branch informing the members that the
      branch is temporarily closed and directing members to the office that is open.
   2. One or two employees will remain at the closed office to assist members that might
      approach the office through its main entrance or the drive through lanes.




                                               [53]
PART 01 EVENT 06
FAILURE EVENT: CASH SERVICES
SCENARIO:        06 Both credit union offices are closed and unable to offer cash services to
                 members.

It is highly unlikely that both offices would be closed and unable to offers cash services at the
same time. Weather events that would force both offices to close would close most businesses in
Wichita Falls at the same time and very little commerce, if any, would be carried on. The only
event that would affect the credit union and no other businesses would be a terrorist attack
carried out simultaneously against both offices. Only the weather can predict the duration of such
an event, but our plans call for a four to ten day business window. There is very little probability
that this would happen for this duration, but it would have a most serious criticality to the credit
union’s ability to service members.

   1. In the event that both offices are closed and inoperable for more than three business days,
      a temporary transaction site will be located. This site could be an empty store front, a
      hotel conference room, or other suitable site.
   2. Sufficient vault cash will be transported from the closed offices or purchased from other
      financial institutions to cover anticipated cash demands from members.
   3. The Chief Operations Officer will cause a printout of the latest member trial balance to
      be made. The printout can be produced by taking the member trial balance file (.pdf) and
      a ream of paper to a business of one of the Directors or to a local business that will permit
      the use of a computer and a printer for a few minutes.
   4. Suitable teller stations will be devised where tellers can have access to a personal “cash
      drawer” and a copy of the member trial balance.
   5. Members will be allowed to withdraw cash up to the amount shown on the account in the
      member trial balance report.
          a. A withdrawal voucher will be prepared for each transaction
          b. Withdrawal vouchers will be kept with each teller’s work and cash drawer until
              they can be posted into the credit union’s computer system.




                                               [54]
PART 01 EVENT 07
FAILURE EVENT: CASH SERVICES
SCENARIO:        07 50% or more tellers are unable to work.

The credit union tends to either employee individuals with varied banking experience, including
teller work, or to promote employees from the teller line into advanced positions. There is a less
than likely probability of 50% or more of the teller line being absent, but in such an event. The
duration of this event is immediate but it is less likely to occur and have a less than serious
criticality.

   1. The Chief Operations Officer will notify the CEO that a significant number of tellers are
      absent and the reasons for the absences.
   2. The COO will select a number of employees with teller experience to fill in the vacancies
      on the teller line. These employees can be rotated to fill the vacancies if the vacancies are
      prolonged.
   3. If the absence of tellers is due to illness, the “substitute” tellers will continue to fill in
      until the tellers return to work.
   4. If the absences are due to an unauthorized work stoppage and the tellers involved have
      their employment terminated:
           a. Human Resources will begin an immediate job search for new tellers.
           b. The “substitute” tellers will continue to fill in until the teller line is at full
              strength.




                                               [55]
PART 01 EVENT 08
FAILURE EVENT: CASH SERVICES
SCENARIO:        08 City-wide power failure.

In the event of a city-wide power failure or the credit union’s mainframe computer system is
disabled. The duration of this event is deemed to be four to ten business days but less than likely
to occur. The criticality is most serious.

   1. The Chief Operations Officer will employ laptop computers of the credit union plus any
      laptop computers of employees to read .pdf files of the member trial balance.
           a. The .pdf file can be copied on to as many USB drives as needed so that tellers can
               view the data.
           b. Efforts will be made to conserve the power on each laptop so that the data is
               accessible during business hours.
   2. Members will be allowed to withdraw cash up to the amount shown on the account in the
      member trial balance report.
           a. A withdrawal voucher will be prepared for each transaction
           b. Withdrawal vouchers will be kept with each teller’s work and cash drawer until
               they can be posted into the credit union’s computer system.
   3. If the city-wide power failure is prolonged, the CEO or his designate will locate a source
      in an unaffected location where the laptop computers can be recharged. For example, a
      retired employee living in Lawton, OK; a business partner in another nearby city that still
      has power; or a local business that has access to generators and is willing to allow the
      credit union to recharge the laptop computers.




                                               [56]
PART 01 EVENT 09
FAILURE EVENT: CASH SERVICES
SCENARIO:        09 Total failure of the credit union’s ATMs.

The probability of all the credit union’s ATMs failing simultaneously and for a prolonged period
of time has very little probability of happening. The duration in this plan is from four to ten
business days but there is very little probability that this event would happen and its criticality is
least serious.

   1. If it is anticipated that the ATMs will be down for more than one business day, a notice
      will be posted at both offices of the credit union advising members that all of the credit
      union’s ATMs are temporarily inoperable. The notice will indicate the date that the
      ATMs should be accessible if this can be reasonably estimated.
   2. Fees for the use of foreign ATMs will be refunded if requested and a member’s account
      history shows a pattern of the member regularly using the credit union’s ATM.




                                                 [57]
PART 01 EVENT 10
FAILURE EVENT: CASH SERVICES
SCENARIO:        10 Total failure of all ATMs in Wichita Falls.

There is an extremely low probability of this ever happening. In the event of the failure of all
ATMS of all the financial institutions in Wichita Falls. The duration in this plan is from four to
ten business days but there is very little probability that this event would happen and its
criticality is least serious.


   1. If the failure is anticipated to last more than one business day, a notice will be placed in
      both offices advising members that all ATMs in Wichita Falls are inoperable and
      advising members to either obtain cash at the teller line or to use their debit cards.




                                                [58]
PART 01 EVENT 11
FAILURE EVENT: CASH SERVICES
SCENARIO:        11 Total failure of all ATMs in the nation.

This scenario is highly improbable and would be the result of some kind of terrorist attack or act
of war. In the event of the failure of all regional, state, or national ATM systems. The duration in
this plan is from four to ten business days but there is very little probability that this event would
happen and its criticality is less serious.


   1. If the failure is anticipated to last more than one business day, a notice will be placed in
      both offices advising members that all ATMs in Wichita Falls are inoperable and
      advising members to either obtain cash at the teller line or to use their debit cards.




                                                 [59]
PART 01 EVENT 12
FAILURE EVENT: CASH SERVICES
SCENARIO:        12 A run on the credit union

This event is highly improbable. It could be the result of a rumor about the stability of the credit
union or fears of an impending economic disaster locally or nationally. In the event of a run on
the credit union. The duration of such an event would be one day or less with very little
probability of happening. It would be a serious event but manageablt.

   1. The credit union will close both offices as soon as a run has been detected.
   2. A notice will be placed at both offices advising members that the credit union is
      temporarily closed.
   3. Back office and accounting work will continue as normal.
   4. The Texas Credit Union Department will be immediately notified that a run on the credit
      union has taken place.
   5. The management team and the Board of Directors will meet to assess the cause for the
      run and to develop a strategy to deal with the run. Issues to be discussed are
          a. What is the cause for the run and how can the cause be resolved.
          b. When can the credit union be reopened to the public.
          c. How much cash is available to meet ATM withdrawals.
          d. Can the credit union accept cash withdrawals requests for limited amounts until
              the run has been resolved. If so, how will this be handled; drive in windows only
              or lobbies.
   6. The Chairman of the Board and the President will make all public statements regarding
      the run giving the public assurance that things are under control and normal business will
      resume as quickly as possible.




                                                [60]
PART 02 EVENT 01
FAILURE EVENT: ELECTRONIC PAYMENTS
SCENARIO:        01 Prolonged absence of primary employee

The probability of this event is less than likely although it is possible for the primary electronic
payments employee to succumb to illness or injury and not be able to work at this position. The
credit union has at least one employee trained as the backup to the primary employee. This event
would be of long-term duration and less than likely to occur. Its criticality is most serious.

   1. Upon learning that the primary electronic payment employee will be absent indefinitely
      due to illness or injury, the Chief Operations Officer will notify the backup employee to
      take over the responsibilities for electronic payments indefinitely.
   2. The COO will notify the CEO that the electronic payments employee will be absent
      indefinitely and that the backup employee has been put in charge of electronic payments.
   3. The COO will make arrangements for another employee to take over the normal duties of
      the backup employee and if need be bring in a temporary employee to handle these
      duties.
   4. The COO will notify Human Resources of the primary employees impending prolonged
      absence and to initiate any leave or insurance options that may apply.




                                                [61]
PART 02 EVENT 02
FAILURE EVENT: ELECTRONIC PAYMENTS
SCENARIO:        02 Coincidental absence of backup electronic payments employee

The probability that both the primary employee and the backup employee will have protracted
absences due to illness or injury is highly unlikely. In anticipation of such an event, the Chief
Operations Officer will cause selected MSRs and/or tellers cross-train in the electronic payments
application. In the event of the prolonged absence of both the primary and backup electronic
payments employees. The duration of such an occurrence is uncertain but estimated to be from
four to ten days. The criticality is most serious.

   1. The Chief Operations Officer will immediately notify the CEO that both employees are
      unable to perform the electronic payments duties due to illness or injury.
   2. The COO will task employees that have cross-trained in electronic payments to assume
      the responsibility until either the primary employee or the backup employee returns.




                                              [62]
PART 02 EVENT 03
FAILURE EVENT: ELECTRONIC PAYMENTS
SCENARIO:        03 Loss of Internet Connectivity

In the event the credit union cannot receive ACH and share draft files due to loss of Internet
connectivity. Both of the credit office has individual access to the Internet, so the event of a total
loss of connectivity is fairly remote. The duration is deemed to be short-term and less than likely
to occur. The criticality is most serious.

   1. In the event that Internet connectivity is lost at the SAR office where electronic payments
      are processed, the electronic payments processing will be conducted at the SPO office.
   2. If the connectivity to the mainframe computer is not available at the SPO office, the ACH
      and sharedraft files will be downloaded to a USB drive and taken to the SAR office and
      loaded on the electronic payments coordinator’s computer.
   3. If the Internet is inaccessible at both offices, the electronic payments coordinator will
      download the ACH and sharedraft file from her(his) home computer or another
      authorized location, copy them to USB drive and bring them to the office to process.
   4. If the Internet is down city-wide, the electronic payments coordinator will travel to an
      approved out of town site to download the files and then bring them to the credit union.
      The approved out of town site is the home of the former CFO, Douglas Bayless, 2615
      NW 78th Street, Lawton, OK, phone 580-536-2617.
   5. If there is no Internet access available at all, the Federal Reserve Bank of Dallas will be
      called and advised that the credit union is unable to receive and process data files. An
      extension for return of unpaid items will be requested. Phone: 214-922-5430.




                                                 [63]
PART 02 EVENT 04
FAILURE EVENT: ELECTRONIC PAYMENTS
SCENARIO:        04 Disaster at Catalyst Corporate FCU

The possibility of a disaster at Catalyst Corporate FCU is possible not likely to occur, and should
a disaster occur, it will be of short-term duration. Catalyst has a business continuity plan that
includes an offsite hot site with appropriate computer equipment and connectivity so that critical
services can be restored in a matter of a few hours. The duration of this event is estimated to be
short-term; it is possible but not likely to occur. Such an occurrence would be of most critical
nature.

   1. Catalyst will notify its member credit unions in the event of a business interruption or
      physical disaster.
   2. Upon receiving notice that Catalyst has been affected by a business interruption, the
      following persons are to be notified: CEO, COO, CFO, Electronic Payments Coordinator.
   3. The CEO will notify the Chairman of the Board that an event has taken place at Catalyst
      and that credit union staff are aware and working with the Corporate CU to process
      members’ transactions as quickly as possible under the circumstance.
   4. When notified of the event, the Chief Operations Officer will be the stand-by contact
      person between the credit union and Catalyst.
   5. As soon as Catalyst has activated its hot site and is able to connect and transmit data files,
      the Electronic Payments Coordinator will process ACH and share draft transactions as
      per normal.
   6. Tellers will transmit the outgoing cash letter as per normal when instructed.
   7. The CEO will report the status of the event to the Chairman of the Board daily until a
      permanent or normal status has been established by Catalyst.




                                               [64]
PART 02 EVENT 05
FAILURE EVENT: ELECTRONIC PAYMENTS
SCENARIO:        05 Disaster at Vantiv

The possibility of a disaster at Vantiv is possible but not likely to occur, and should a disaster
occur, it will be of short-term duration. Vantiv has a business continuity plan that includes an
offsite hot site with appropriate computer equipment and connectivity so that critical services can
be restored in a matter of a few hours. Vantiv is the gateway for members’ ATM and debit card
transactions. The duration is short-term and its criticality is very serious.

   1. Vantiv will notify its business partners in the event of a business interruption or physical
      disaster.
   2. Upon receiving notice that Vantiv has been affected by a business interruption, the
      following persons are to be notified: CEO, COO, CFO.
   3. The CEO will notify the Chairman of the Board that an event has taken place at Vantiv
      and that members will not be able to use our ATMs until service is restored.
          a. ATMs may be down until Vantiv’s hot site is fully operational, which should be
              within just a few hours of the event happening.
          b. MasterCard will stand-in on debit card transactions until Vantiv’s hot site is fully
              operational.
   4. When notified of the event, the Chief Operations Officer will be the stand-by contact
      person between the credit union and Vantiv.
   5. The CEO will report the status of the event to the Chairman of the Board daily until a
      permanent or normal status has been established by Catalyst.




                                               [65]
PART 02 EVENT 06
FAILURE EVENT: ELECTRONIC PAYMENTS
SCENARIO:        06 Communication between the credit union and Vantiv disabled

The possibility that communications between the credit union and Vantiv are disabled is less
than likely to occur and it would be very serious in that members can perform ATM and debit
card transactions but the credit union could not receive them and post the transactions to the
members’ accounts. The duration of this event is short-term and serious but very manageable.

   1. The Chief Operations Officer or IT Manager will contact Vantiv to inform them that
      connectivity has been lost. 513-900-4652.
   2. The IT Manager will identify the source of the connectivity failure and contact the
      appropriate vendor to restore connectivity.
   3. The COO will notify the CEO and CFO that connectivity to Vantiv has been lost and that
      Vantive and MasterCard are in stand-in mode.
   4. Once connectivity has been restored and the members’ transactions have been posted to
      their accounts, the COO will determine if any unwarranted overdrafts have occurred
      during the loss of connectivity.




                                              [66]
PART 02 EVENT 07
FAILURE EVENT: ELECTRONIC PAYMENTS
SCENARIO:        07 Loss of mainframe computer

The loss of the credit union’s mainframe computer is less than likely to occur; it would be
serious but manageable should it occur. The duration of this event is short-term and serious but
very manageable.


   1. The Chief Operations Officer will immediately notify CMC Flex that the mainframe
      computer has suffered irreparable damage and must be replaced. 800-262-3539
   2. The COO will immediately place an emergency order for a replacement mainframe. The
      new mainframe should be delivered and able to operate within 3 business days.
   3. The CEO will notify the Chairman of the Board of Directors of the loss of the mainframe
      computer and that actions are in place to replace it.
   4. The CEO will determine whether to close the credit union or operate in manual mode
      until such time as the new mainframe is installed and functional.




                                               [67]
PART 02 EVENT 08
FAILURE EVENT: ELECTRONIC PAYMENTS
SCENARIO:        08 Loss of Branch Capture

The loss of the Branch Capture function occurs if the check scanner physically breaks down or
has a software failure. This is a short-term event that is less likely to occur and is serious but
manageable. The greatest liability is that large outgoing items may be returned unpaid and the
money no longer available in the members’ accounts.

   1. The Chief Operations Officer will notify Catalyst that the check scanner has failed and
      that outgoing cash letters will be delayed.
   2. The IT Manager will make arrangements for the scanner to be repaired or replaced.
   3. Tellers will resume scanning cash letters as soon as the scanner is operational.




                                                [68]
PART 03 EVENT 01
FAILURE EVENT: OPENING ACCOUNTS
SCENARIO:        01 One credit union office and not able to open accounts

This is a short-term event that is possible but not likely to occur and is least serious in criticality.

    1. Members will be referred to the other office to open accounts.




                                                  [69]
PART 03 EVENT 02
FAILURE EVENT: OPENING ACCOUNTS
SCENARIO:        02 Both offices are closed and unable to open accounts

This is an intermediate term event that has very little probability of happening. If such an event
should happen is would be serious but very manageable.

   1. The General Business Continuity will be enacted.




                                                [70]
PART 03 EVENT 03
FAILURE EVENT: OPENING ACCOUNTS
SCENARIO:        03 50% or more MSRs are unable to work

This is an intermediate term event that is possible but not likely to occur and is less serious in
criticality. Many of the credit union supervisors and lead employees have had experience as
MSRs and would be able to fill in until such time the absent MSRs return to work or are
replaced.

   1. The Chief Operations Officer will notify the CEO that a significant number of MSRs are
      absent and for what reasons.
   2. Employees with MSR experience will be temporarily assigned to MSR desks to open
      accounts.
   3. Management will oversee the temporary MSRs and advise as to how to proceed on
      unusual circumstances that may arise.
   4. If it is necessary to hire new MSRs, consideration will be given first to employees that
      are interested and have essential qualifications; outside hires will follow normal hire
      procedures.




                                                [71]
PART 03 EVENT 04
FAILURE EVENT: OPENING ACCOUNTS
SCENARIO:        04 City-wide power failure

This is an intermediate term event that has probability less likely of happening. If such an event
should happen is would be least serious in criticality.

   1. The General Business Continuity will be enacted.




                                               [72]
PART 04 EVENT 01
FAILURE EVENT: LENDING
SCENARIO:        01 One credit union office and not able to offer lending services

This is a short-term event that is possible but not likely to occur and is least serious in criticality.

    1. Members will be referred to the other office to apply for loans.




                                                  [73]
PART 04 EVENT 02
FAILURE EVENT: LENDING
SCENARIO:        02 Both offices are closed and unable to offer lending services

This is an intermediate term event that has very little probability of happening. If such an event
should happen is would be serious but very manageable.

   1. The General Business Continuity will be enacted.




                                                [74]
PART 04 EVENT 03
FAILURE EVENT: LENDING
SCENARIO:        03 50% or more loan officers are unable to work

This is an intermediate term event that is possible but not likely to occur and is less serious in
criticality.

   1. Management personnel with lending experience will act as loan officers.
   2. The Indirect Lending Officer and other employees with lending experience will accept
      applications and make loans where possible.
   3. If it is necessary to hire new loan officers, consideration will be given first to employees
      that are interested and have essential qualifications; outside hires will follow normal hire
      procedures.




                                                [75]
PART 04 EVENT 04
FAILURE EVENT: LENDING
SCENARIO:        04 City-wide power failure

This is an intermediate term event that has probability less likely of happening. If such an event
should happen is would be least serious in criticality.

   1. The General Business Continuity will be enacted.




                                               [76]
PART 05 EVENT 01
FAILURE EVENT: MANAGEMENT/BOARD
SCENARIO:        01 Loss of Chief Executive Officer

In the event of the loss of the Chief Executive Officer through death, injury, or removal from
office. The duration of such an event would be greater than ten business days. It is less than
likely to occur but is most serious in criticality.

   1.  In the event of the death or long-term injury of the Chief Executive Officer the Chief
      Operations Officer will assume the duties of the Chief Executive Officer.
   2. Notify the Chairman of the Board of Directors as soon as possible.
           a. The Chairman will call a special meeting of the Board of Directors to appoint the
              Chief Operations Officer acting CEO.
           b. The Board will formally authorize the acting CEO to accept all authority and
              signing powers of the CEO.
           c. The Board will initiate an executive search for a new Chief Executive Officer if
              the former CEO will not return.
   3. The acting CEO will execute all necessary documents and procedures related to the
      authority and signing powers of the CEO.
   4. Human Resources will assist the family of the former CEO (or incapacitated CEO) with
      insurance and other benefit claims.




                                               [77]
PART 05 EVENT 02
FAILURE EVENT: MANAGEMENT/BOARD
SCENARIO:        02 Loss of Chief Financial Officer

In the event of the low or the Chief Financial Officer through death, injury, or removal from
office. The duration of such an event would be greater than ten business days. It is less than
likely to occur but is very serious in criticality.


   1. In the event of the death or long-term injury of the Chief Financial Officer, the Chief
      Executive Officer will appoint the credit union’s accountant to act as the supervisor for
      the accounting department.
   2. The CEO will advise the Board of Directors of the loss of the CFO as soon as possible.
   3. The CEO will begin an executive search for a new CFO.
   4. The CEO will authorize the accountant to sign and execute necessary documents and
      transactions involved in the routine work of the CFO. The CEO will assume the
      responsibility for actions that are more sensitive than what he authorizes the accountant
      to handle.
   5. The accountant will assume responsibility for daily cash management through TranZact
      and will make recommendations to the CEO for investment transactions.
   6. Human Resources will assist the family of the former CFO (or incapacitated CFO) with
      insurance and other benefit claims.




                                               [78]
PART 05 EVENT 03
FAILURE EVENT: MANAGEMENT/BOARD
SCENARIO:        03 Immediate Loss of all executive management personnel.

In the unlikely event that all management personnel are lost through death, injury, or removal
from office. The duration of such an event would be greater than ten business days. It very little
likelihood to occur but is most serious in criticality.


   1. The Chairman of the Board of Directors will convene an emergency meeting of the Board
      of Directors to advise them of the loss of the management team.
   2. The Chairman will act in the capacity of the Chief Executive Officer as the direct
      supervisor of the daily activities of the credit union until more appropriate arrangements
      have been made.
   3. The Director of the Texas Credit Union Department is to be notified as soon as possible.
      512-837-9236.
   4. The NCUA Regional V Director is to be notified as soon as possible. 512-342-5600.
   5. The Texas Credit Union League is to be notified as soon as possible. 800-442-5762. The
      League can help find suitable management personnel from other credit unions to help
      with the ongoing business of the credit union until a replacement management team is in
      place.
   6. Human Resources will assist the families of the former management teach with insurance
      and other benefit claims.
   7. The Board of Directors will commence an executive search for personnel to replace the
      management team.
   8. Supervisors and lead employees will work with the Board Chairman and any temporary
      management staff to assure the ongoing daily operation of the credit union.




                                               [79]
PART 05 EVENT 04
FAILURE EVENT: MANAGEMENT/BOARD
SCENARIO:        04 Immediate loss of all Board members.

In the unlikely event that all members of the Board of Directors should be lost to the cfredigt
union for any reason. The duration of such an event would be greater than ten business days. It
very little likelihood to occur but is most serious in criticality.


   1. The Chief Executive Officer (CEO) will notify the Director of the Texas Credit Union
      Department as soon as possible. 512-837-9236.
   2. The CEO will notify the NCUA Regional V Director as soon as possible. 512-342-5600.
   3. The CEO or an authorized representative of the Director of the Texas Credit Union
      Department will call a special meeting of the credit union membership for the election of
      new directors.
          a. New directors will be elected to fill the unexpired terms of the original directors.
          b. Advisory directors will be placed on the ballot as candidates for the longer
             remaining terms as their experience with the Board will give continuity.
   4. The management team will conduct the routine business of the credit union without
      entering into circumstances where the approval or guidance of the Board of Directors is
      needed until such time as a new Board has been seated.




                                              [80]
PART 06 EVENT 00
FAILURE EVENT: PHYSICAL DISASTER
SCENARIO:        1–6

Any physical disaster will invoke the General Business Continuity Plan.




                                             [81]

				
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