By Glen Olpin, Senior Vice President/Chief Economist

Each new year gives us the opportunity to reflect on the financial trends & conditions that have affected the membership over the past 12 months, as well as forecast how these economic factors will impact our operations going forward.

We expect a strengthening national economy this year, improving somewhat from what we experienced in 2016. A recent survey indicates most America First members have a wait-and-see attitude toward economic growth. Only 27% of respondents see an improvement coming, compared with over 30% a year ago. However, since the resolution of the U.S. presidential election, we have seen the stock market accelerate, confidence soar, and small businesses demonstrate higher levels of optimism.

Benchmark interest rates edged up slightly during 2016, and we forecast two to three additional quarter-percent increases throughout the year as the American economy gains momentum.

Utah’s 3.1% unemployment rate is well below the national average of 4.7%. The state also ranks among national leaders in job growth. Nevada’s labor markets were greatly improved, with unemployment levels falling to 5.2%. A large percentage of our members believe their personal employment situations will get better this year.

Consumer spending has expanded, resulting in sustained overall economic growth, even without significant increases in personal income. National retail sales grew more than 4% in 2016.

Personal credit saw faster than 6% growth for the year, while at America First, loan demand has been significant and is expected to continue into the future. Due largely to units moved in December of 2016, new auto sales set an annual industry record. Demand is expected to ease slightly during 2017. As it does, we expect dealer incentives to continue playing a key role in sales growth.

Inflation stayed low, but increasing home values & sales have created strong market conditions. We expect continued housing and construction growth during 2017, even as interest rates rise moderately.

While public uncertainty has to a large extent faded, questions remain regarding fiscal spending, regulatory reform, tax code changes, trade relations, and other issues. Ongoing expectations for positive changes in Washington will likely buoy the economy as it expands.

Regardless of the larger economic environment, all of us at America First are committed to providing you with service excellence, delivering high-quality financial products & services, and establishing lasting relationships of trust.

We appreciate the confidence you’ve placed in your credit union and thank you for your membership.

By John B. Lund, President and Chief Executive Officer

I am pleased to report that 2016 was another outstanding year. Your credit union remains safe, strong, well respected, and positioned for a bright and vibrant future.

To be part of a truly outstanding organization and team–that has among its core principles the mission to improve the financial well-being of its members, as well as the communities in which we live and work–is extremely gratifying. We strive to create meaningful relationships by providing relevant and affordable financial solutions for individuals, families, and businesses.

Significant milestones we reached include surpassing $8 billion in assets, growing to over 800,000 members, and opening new locations in Arizona and Idaho. America First is the 11^th largest credit union in the nation in terms of assets and 7^th most substantial in membership. While size provides critical mass necessary for a complex and changing world, I believe our growth and success reflects the fact that we offer consistent value, convenience, and high levels of service.

Additional highlights of 2016 include:

• We opened new locations in Santa Clara, Washington, Jeremy Ranch, and Traverse Mountain, Utah; Summerlin, Nevada; Boise, Idaho; and Phoenix, Arizona.
• Our first-of-its-kind Innovation Center debuted in Salt Lake’s City Creek Center, showcasing and giving members the opportunity to test and evaluate new technologies and services.
• Superior service scores & measurements continue to be very strong and are among the best in the nation.
• We improved call center systems, resulting in dramatic wait time reduction.
• We received outstanding ratings and reviews from our external auditors and our federal regulator.
• Member-selected personal identification numbers were made available.
• A new & free identity theft recovery service was offered to those who use America First Visa® credit cards. This is in addition to our Card Guard® mobile security app that provides real-time credit and debit card control.
• EMV chip-enabled Visa cards were issued for an extra layer of protection.
• Our Visa cash-back cards featured a higher rebate level and we enhanced the free ABC Dealsâ„¢ program.
• New and improved loan and deposit services for business account holders were delivered.
• We were again recognized as the number-one auto lender in Utah & the top credit union auto lender in Nevada.
• Our tradition of being your premier provider of electronic services continued.
• We developed engaging social media initiatives and demonstrated solid results.
• Many educational programs for students and teachers in our schools were undertaken.
• Our dedication to making significant outreach efforts to the communities we serve was evident, including the donation of time, means, and goods to those in need or those who require a helping hand.

As we look forward, you can be certain that America First will remain committed in our resolve to bring you the very best in financial services. I hope 2017 is a year of peace, productivity, and positive outcomes for you and those you love. Thank you for supporting America First Credit Union. We look forward to a lifelong relationship.

By John B. Lund, President and Chief Executive Officer

During my youth, the holidays and Christmas were modest, yet memorable times. It is a meaningful life lesson for me in reflecting back that I remember very few specific gifts. However, the inspiring sights, the wonderful scents, the delicious foods, and the fun I had with friends and family are precious, vivid recollections that stay with me to this day.

When she was preparing for the season, my mother made fantastic meals that would be enjoyed not just at one sitting, but for days thereafter. My favorites included macaroni & shrimp salad, three-bean salad, ham, rolls, cheeses, and her fabulous potato salad. Her date nut loaf was a much-anticipated dessert.

My dad enjoyed decorating our home, both inside and out. Creating this festive atmosphere in the outdoors was a big project that took considerable time. And I’m sure his having to keep after me to help slowed down our progress. When complete, the site was absolutely beautiful, especially after a fresh storm, with the lights showing through the snow and reflecting off the icicles.

To enhance the holidays even further, he built an outdoor speaker system so that passersby could listen to Christmas music. He played vinyl records on our hi-fi stereo from greats such as Bing Crosby, Nat King Cole, Frank Sinatra, Perry Como, the Andrews Sisters, Johnny Mathis & Andy Williams. I treasure these wonderful classics to this day.

All of my parents’ efforts to make these occasions special were put forth in the spirit of love and selflessness. In the process, long-term relationships and precious memories were developed and strengthened.

It’s truly the positive connection with others that enriches our lives in a relevant and enduring manner. While the relationships we at America First have with you as members can’t be quite this intimate, we do strive to make our services personal, meaningful, and lasting.

On behalf of our entire team of volunteers and staff, we wish you a merry Christmas and a happy new year. Please remember to pick up your free 2017 calendar at any of our branches. We thank you for your membership and look forward to a lifelong relationship in serving you and your family.