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2008 Annual Report

President’s Message
Greetings everyone and happy 75th Anniversary! Despite all the tenuous economic news these days, we at SPIRE have a big anniversary to celebrate in 2009! The origin of SPIRE occurred back on March 13, 1934, ironically during tough economic times – the Great Depression. One of the challenges today is to maintain that passion, spirit and vision of Edgar (please read the story under the “Our History” section of this report) and the other original members who saw the credit union model as a way to improve the lives of those who participated. We need to ensure that future generations see, feel, recognize and experience how the model can still be relevant and thriving in today’s crowded marketplace. As we look forward, the Board and Leadership Team has been busy over the last few months developing a short and long-term plan for SPIRE leading up to 2020. This plan includes re-articulating our organizational mission into a couple of key, succinct points – our core purpose and core values. If you know me at all, you know that I like to use a lot of words to convey my point. However, we were determined to be clear and concise to our Board, staff, and members. SPIRE’s core purpose is to improve the financial well-being of our member-owners. Just as our parents gave us “words of wisdom” before sending us on our own journey, SPIRE’s timeless values help guide us through good times and bad – whether applied to the member, staff, or the organization. Do the right thing – Work with integrity. People matter – Develop and nurture relationships. What’s next? – Look to the future with imagination. Uphold a reputation of excellence. While it is hard to predict what the future will bring, we know our journey must include a focus that will result in future generations recognizing and appreciating our cooperative brand of banking. That is not to say we will ignore current generations as they mature – we know their world and realities are changing. Our world is rapidly evolving and we must be prepared to serve our current and future member’s needs differently for both individual consumers and small business owners. We should also celebrate some of our accomplishments in 2008 that have “member facing” impact – the construction and opening of our new Eden Prairie Branch location, which improves upon our visibility to prospective members and greatly improves upon the functionality of our space. We unveiled account e-alerts, which increase your convenience of timely information while reducing our mailing costs. You may have also noticed that we added two new leaders to our senior management team – again to help our credit union focus on you, the member, as we grow more complex. Another important effort is our continued enterprise-wide containment of costs. We have held the line on our operating expenses over the last five years intentionally to position the organization well in these economically challenging times. While we may not be experiencing the severe challenges of the Great Depression, we certainly are seeing “market failures” that can be turned into opportunities. As we march ahead in 2009, SPIRE will continue to seek out those opportunities just like we and other cooperatives have done in the past.

In Service, John G. Gisler, President and CEO


To improve the financial well-being of our member-owners. Do the right thing. Work with integrity. People matter. Develop and nurture relationships. What's next? Look to the future with imagination. Uphold a reputation of excellence.

elebrating 75 Years

Consolidated Statements of Income
As of June 30, 2008 2008 $30,939,411 2,334,535 2007 $28,659,142 2,592,989 2006 $25,474,595 1,381,824 2005 $22,972,590 886,893 2004 $24,022,112 540,099 Interest Income Loans

Securities & Short-Term Interest-Bearing Accounts






Interest Expenses Interest to Members $14,881,194 2,939,790 $15,452,962 $13,678,672 3,190,414 $14,383,045 $10,718,852 1,834,128 $14,303,439 $8,305,422 738,363 $14,815,698 $8,093,476 6,007 $16,462,728

Interest on Borrowed Funds Net Interest Income

Provision for Loan Losses

$ 3,767,159 $11,685,803





$ 1,145,141 $13,670,557

$ 1,563,212 $14,899,516

Net Interest Income After Provision for Loan Losses $13,772,793 $14,083,572

Other Income Service Charges & Other Fees $ 8,256,238 0 $ 8,256,238 $ 7,781,198 0 $ 7,781,198 $ 7,541,954 0 $ 7,541,954 $ 7,161,550 0 $ 7,161,550 $ 7,031,703 0 $ 7,031,703

Securities Gain (Losses) Net

Other Expenses Salaries & Employee Benefits $ 9,709,817 2,147,756 7,589,356 $19,446,929 $ 495,112 $ 9,568,416 1,999,100 7,017,709 $18,585,225 $ 2,968,766 $ 9,208,635 1,927,808 6,931,638 $18,068,081 $ 3,557,445 $ 9,138,650 1,754,356 7,430,376 $18,323,382 $ 2,508,725 $ 9,689,825 1,907,775 7,736,180 $19,333,780 $ 2,597,439

Office Operating Expenses

Other Expenses

Net Income

Consolidated Balance Sheet
As of June 30, 2008 2008 Assets Cash & Cash Equivalents Securities & Other Investments Loans, Net Accrued Interest Receivable Premises & Equipment, Net NCUSIF Deposit Other Assets Total Assets $ 4,799,253 88,052,761 472,459,666 2,366,267 18,439,365 4,041,113 3,397,090 $593,555,515 $ 7,297,930 60,054,720 476,329,462 2,006,459 18,840,609 3,993,137 3,221,909 $571,744,225 $ 6,041,041 46,193,798 464,703,146 1,327,641 15,310,968 3,926,951 3,377,329 $540,880,873 $ 5,345,458 33,991,715 441,370,280 1,136,312 14,188,742 3,906,662 3,090,160 $503,029,329 $ 4,499,474 15,477,843 422,240,160 1,103,303 12,509,104 3,907,320 2,943,760 $462,680,964 2007 2006 2005 2004

Liabilities Deposit Accounts & Certificates Accrued Interest Payable & Other Liabilities Borrowed Funds Total Liabilities $480,555,960 2,580,173 62,500,000 $545,636,133 $456,800,170 2,679,289 65,000,000 $524,479,459 $434,525,420 2,301,012 60,000,000 $496,826,432 $435,369,420 1,959,977 25,000,000 $462,329,397 $418,419,385 1,801,433 4,289,820 $424,510,639

Members’ Equity Substantially Restricted Total Liabilities & Equity $ 47,919,382 $593,555,515 $ 47,264,767 $571,744,225 $ 44,054,441 $540,880,873 $ 40,699,932 $503,029,329 $ 38,170,325 $462,680,964

Independent Auditor’s Report

INDEPENDENT AUDITOR’S REPORT Supervisory Committee Spire Federal Credit Union and Subsidiary Falcon Heights, Minnesota We have audited the accompanying consolidated statements of financial condition of Spire Federal Credit Union (formerly Twin City Co-ops Federal Credit Union) (a federally chartered credit union) and Subsidiary as of June 30, 2008 and 2007 and the related consolidated statements of income, comprehensive income, members’ equity, and cash flows for the years then ended. These financial statements are the responsibility of the Credit Union’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Spire Federal Credit Union and Subsidiary as of June 30, 2008 and 2007 and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

Minneapolis, Minnesota November 5, 2008

McGladrey & Pullen, LLP is a member firm of RSM International – an affiliation of separate and independent legal entities.

• American Red Cross • Anoka Halloween Parade • Children’s Miracle Network • The Co-op Foundation • Falcon Heights Parks & Recreation • Gillette Children’s Hospital • Heartland Institute • Homes for Our Troops • Kentron Foundation • Keystone Community Services • Lindbergh Foundation • MAC Youth Co-op Leadership Conference • Maple Grove Days • Midwest Challenge • Minnesota Credit Union Foundation • Minnesota State Fair • Minnesota Twins Community Fund • Minnesota Visiting Nurses Association • New Visions New Ventures • Princeton Rum River Days • Saint Paul Farmer’s Market • Second Harvest Heartland • Toys for Tots • Woodbury Days
Auto/RV Real Estate

SPIRE was proud to support these organizations in 2008

Loan Portfolio as of June 30



Visa Other

Board of Directors
Tom Hirte, Chair Lee Brucker, Vice Chair



Executive Management
John Gisler,
President/CEO Dan Stoltz, Executive Vice President Jim Chamberlain, Vice President Louis Doering, Vice President Kellie Eaton, Vice President Stan Edwards, Vice President Mike Schrader, Vice President



Jeff Streiffer, Secretary/Treasurer Lu Hammer Ron Glasgow Diane Haugen
200 300 400 500



2004 0


Jim Taglia

Deposit Portfolio as of June 30

Money Market Certificates



Checking Savings



Supervisory Committee
Javaid Masoud, Chair Tom Heinzen, Vice Chair Julie Gehrke





Ron Glasgow Richard Olson

2004 0

100 200 300 400 500

Our History

It all started because Edgar Archer had an idea... to start a credit union...
Times were bad back in 1933. The Great Depression was at its height; jobs and money were scarce. Banks that had survived the crash of 1929 had little cash, and they were not lending it. To save their homes and farms, people were forced to do business with loan sharks at 36% interest. It was into these historic and economic circumstances that Twin City Co-ops Federal Credit Union (TCU), since renamed to SPIRE Federal Credit Union, was born, 75 years ago. In its founding, SPIRE embodied the credit union ideals of self-help, of people working together to save their money, lending to each other and paying back their earnings to each other in the form of dividends. The idea of a credit union started with Edgar Archer. Archer was an employee of what was then called Midland Cooperative Oil Association. Before starting with Midland, Archer had been out of work for some time, resulting in a number of unpaid bills. Now that Edgar was employed, he applied for loans all by one he was turned down. He wanted to “do the right thing’’ and pay his debts. Edgar did not give up. He had been hearing about an employee credit union, so he thought, why not start one at Midland? By February 1934, enough of his fellow workers agreed, and seven of them applied for a certificate of organization. Through the foresight of the original founders, the credit union escaped the narrow confines of an employee credit union and has since grown significantly because of the doors that were opened back in 1934. The credit union organizers incorporated on March 13, 1934. The loan maximum was set at $50, with interest at 1% monthly on the unpaid balance. Edgar Archer was the first to apply for and receive a loan.


March 13, 1934, Twin City Oil Co-ops
Credit Union opened to serve Midland Cooperatives, Inc. At its first Annual Meeting, the credit union had 52 members, share savings of $601.72 and loans totaling $1,276.98.

By 1940, the credit union was split into two groups, with TCU servicing Co-op Services and a new credit union being formed to serve Midland Employees.
TCU bought its first typewriter, ledger posting machine, adding and calculating machines.

“Oil” was dropped from the name, becoming Twin City Co-ops Credit Union.


TCU built its own building, the first credit union in Minnesota to do so.

Current Minneapolis branch located at 3117 University Avenue SE.

Payroll deduction arrives at TCU.

1959 – TCU is 25 years old!
Assets exceed $2

million with 4,459 members

In 1960, TCU merges with Ellerbe Company Employees Credit Union, becoming the first credit union in Minnesota to merge with another one.

Credit Committee Repor t

2,034 Personal Loan Total in 1970 Adds Up To $2,798,619
By William A. Takala, Chairman Allert T. Sneva, Vice Chairman Jerome J. Bilder, Secretary

TCU granted insurance coverage by NCUA.


Share drafts (Checking Accounts) became available.

TCU is 50 years old!

TCU Mergers
1983 – Princeton Co-ops Credit Union 1987 – Peoples Northland Federal Credit Union 1991 – “66” Credit Union


TCU is federally chartered and becomes Twin City Co-ops Federal Credit Union.

TCU converted to an in-house data processing system.


1993 – Assets reach

Internet banking offered to TCU members.

$100 million

TCU merges with Pioneer Plus Federal Credit Union

TCU reaches $500 million in assets!

Twin City Co-ops Federal Credit Union becomes...


Mobile banking available at SPIRE.

2009 – SPIRE celebrates 75 years!
Assets exceed $600

million with 61,000 members

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