2016 2015 ASSETS Net Loans 362,276,125 368,270,390Cash 101,295,838 75,069,056Investments 55,763,799 40,173,337Fixed Assets 17,331,953 15,271,080Other Assets 10,089,592 14,599,998

Total Assets 546,757,307 513,383,861

LIABILITIES & EQUITY Total Liabilities 7,739,922 6,480,566 Total Shares 475,436,313 447,339,581 Total Equity 63,581,072 59,563,714

Total Liabilities & Equity 546,757,307 513,383,861

INCOME & EXPENSES Interest Income 16,555,041 16,227,927 Interest Expense 984,133 979,684

Net Interest Income 15,570,908 15,248,243 Fee and Other Income 6,618,380 6,706,207

Income Before Operating Expenses 22,189,288 21,954,450 Operating Expenses 16,645,214 15,642,779 Provision Expense 1,543,996 2,982,006

Net Operating Income 4,000,078 3,329,665 Non-operating Income/(Expense) 9,615 (2,588)

Net Income 4,009,693 3,327,077

Statement of Financial Conditionas of December 31, 2016 and 2015

Unaudited

For further information refer to the NCUA website http://www.ncua.gov and use charter #64759 to pull additional financial reports for Del Norte Credit Union.

2017 ANNUAL MEETING AND REPORTThursday, May 11, 2017, 6:00 p.m.

3286 Cerrillos Road, Administration BuildingSanta Fe, New Mexico

MEETING AGENDA

Net Loans 362,276,125 368,270,390Net Loans 362,276,125 368,270,390Cash 101,295,838 75,069,056

1. Call to Order 2. Determination of a Quorum 3. Approval of the Agenda4. Appointment of Parliamentarian – Kevin Hammar, Esq. 5. Introduction of Current Directors, Supervisory Committee Members6. Presentation of Annual Meeting Minutes dated Thursday, May 12, 2016*7. Introductions by the Board Chairman: Introduction of President/CEO Introduction of Managers and Sta� in Attendance by CEO8. Nominees - Report: Martin Varela, NEC Chairman 9. Motion to A� rm Nominees 10. Annual Reports – Board Chair Treasurer Supervisory Committee Chair11. Service Awards 12. 2017-18 Scholarships13. Door Prize Drawings14. Comments/Questions from the Membership 15. Adjournment

*Audited Financial Statements, Minutes of the 2016 Annual Meeting, DNCU By-Laws are available.

As Chairman of the Board of Directors, I am pleased to present this summary report of our progress during the 2016 calendar year for Del Norte Credit Union (DNCU). The Board of Directors (Board) is responsible for maintaining the general direction of DNCU in accordance with all applicable laws, regulations, sound business practices, and our bylaws.

DNCU is a not-for-profi t fi nancial cooperative with a mission to improve the lives of our member/owners. We strive to be the ideal partner for a better future, here to bring members the best service in deposit accounts, consumer and real estate lending products, and assistance in planning for the future. Our values are based on Del Norteño Pride. DNCU sta� o� er fi nancial products, services, and advice designed to save our member/owners time and/or money.

Our commitment to providing exceptional fi ve-star service was recognized by readers of the Santa Fe Reporter again in 2016 by being voted “Best Credit Union” for the sixth year in a row. We were extremely proud to be voted #2 Best Bank as well.

Safety of member data is extremely important to DNCU, as is working to o� er the latest technologies. In 2016 we reissued our debit cards with EMV (Europay-Mastercard-Visa) chips in order to protect our member/owners with the latest technology available. Our credit cards use EMV chip technology as well. Internally, our IT department follows best practices to maintain system integrity, and all sta� are trained to respect and protect member information.

We continue to improve the lives of our members by providing education and updated products and services. We o� ered educational car buying seminars in 2016 as well as quarterly Del Norte Investment Services seminars on social security planning, long-term care and other topics. Mobile and online banking products are a big emphasis for us in order to provide convenience for our members; this year we added Touch ID access to our mobile app as well as an extremely popular feature, External Transfers. We incorporated DocuSign into our electronic services which allows members to apply for loans and sign documents without having to come to a branch.

Our commitment to fi nancial education remains strong. Through our programs more than 1,160 students from 14 middle and high schools benefi ted in 2016. Our partner GreenPath provides regular fi nancial literacy seminars, rich online resources, and debt counseling free to our members. In addition, DNCU awarded 7 scholarships to deserving high school seniors in 2016.

Enhancing our branch system with DNCU-owned properties is a continuing goal. We opened our White Rock branch in July as a full service branch with an additional focus on managing electronic applications. The new San Mateo branch, which will replace our Cordova branch, is under construction for a grand opening scheduled for July 2017.

Our community outreach programs emphasize our commitment to the youth of Northern New Mexico. Our Teen Tuesday program which raises funds from employees for teen organizations was launched in 2016. DNCU and employees supported non-profi ts serving youth in Los Alamos, Espanola and Santa Fe. These included The Family Y, Los Alamos Family Council, Espanola Teen Center, YouthWorks, Adelante, Project R.A.C.E. (Rio Arriba Community Empowerment) and other programs. We also continue to sponsor organizations and events which serve our members, the community, and our strategic goals. Sponsorships included Kiwanis Club of Los Alamos, Big Brothers Big Sisters Mountain Region, LANL school backpack program, The Food Depot, Pajarito Environmental Education Center and Creative Santa Fe’s FantaSe festival.

Financial safety and soundness is paramount for us. I am happy to report our fi nancial position remains rock-solid, as outlined in the Treasurer’s report.

The Board of Directors and the management and sta� of Del Norte Credit Union appreciate your continued support and the opportunity to provide you with products, services, and advice to help you meet your fi nancial goals for every stage of life. Thank you for your membership!

Clyde LeybaChairman, Board of DirectorsDel Norte Credit Union

Del Norte Credit Union (DNCU) continues to operate in a fi nancially safe and sound manner. As of December 2016, we earned our 52nd consecutive quarter fi ve star rating as an “exceptional performance credit union” by Bauer Financial Services, the leading independent bank and credit union rating and research fi rm. We also have an A+ rating from DepositAccounts.com and have been named to their Top 200 Healthiest Credit Unions.

For the twelve months ending December 31, 2016, we continued to improve our fi nancial condition. With a solid capital ratio of 11.69%, DNCU is well above the National Credit Union Administration (NCUA) “well capitalized” position of 7%. We look forward to continuing these results for our membership into the future.

2016 was a solid year for Del Norte Credit Union operations. Please see the Statement of Financial Condition in this report. Net income was slightly over $4 million for the year. Assets increased by $33 million to end the year at almost $547 million while capital increased by 6.7% to $63.6 million. Total loans shrank by $6.0 million to $362 million while deposits grew by over 6% or $28 million to $475 million. DNCU maintains a very low interest rate risk profi le, so as interest rates rise further in 2017, we will continue to be well positioned for this changing rate environment.

As a not-for-profi t fi nancial cooperative we are pleased that we are meeting our goal of operating in a sustainable, safe, and sound manner while providing fi ve-star service and improving the lives of you, our member/owners.

We closely monitor DNCU’s fi nancial situation and make decisions to ensure the fi nancial safety and soundness of your credit union. We strive to provide our members the best possible service, fairly priced products, and technology to make members’ banking lives easier.

Thank you for your membership and continued support.

Luis AlbaTreasurer, Board of DirectorsDel Norte Credit Union

The Supervisory Committee (The Committee), whose members are appointed by the Board of Directors, is responsible for ensuring the fi nancial records of Del Norte Credit Union are accurate and that safeguards are in place to protect the assets and information of the credit union and its members. The Committee interacts with regulatory agencies, professional auditing fi rms, the Board, and management to address fi nancial, compliance, internal control, and regulatory issues.

The Committee, working with management, developed a long-term method for monitoring potential regulatory changes that may impact the credit union. The focus of this e� ort is to ensure that compliance with all regulations is addressed in an e� cient and timely manner by management and sta� while at the same time containing costs and meeting required deadlines.

The Committee oversees the annual CPA opinion audit, member account verifi cation process, internal audit function, National Credit Union Association & New Mexico Financial Institutions Division examinations, and monitors member feedback. The audit report conducted by the independent auditing fi rm of Nearman & Associates, CPAs for the year ended March 31, 2016, is available upon request, and the March 31, 2017 audit will be available in July 2017. Credit Union Resources conducted DNCU’s internal audits in 2016.

I am pleased to report that once again in 2016, DNCU received a clean audit opinion from our CPA fi rm, Nearman & Associates, a very positive report from the NCUA & FID’s regulatory audit, and positive feedback from the various Credit Union Resources internal audits.

The Committee will continue to work on the members’ behalf to ensure DNCU’s assets are protected, regulations are followed, and the credit union continues to operate in a safe and sound manner.

Sincerely,

Roger StutzChairman, Supervisory Committee

CHAIRMAN’S REPORT SUPERVISORY COMMITTEE REPORT

BOARD OF DIRECTORSClyde Leyba CHAIR

Art Salgado VICE CHAIR

Luis Alba TREASURER

Lilliemae Ortiz SECRETARY

Delia Cisneros DIRECTOR

Julie Feldman DIRECTOR

Len Montoya DIRECTOR

Benito Salazar DIRECTOR

Martin Varela DIRECTOR

Levi Lopez DIRECTOR EMERITUS

SUPERVISORY COMMITTEERoger Stutz CHAIR

Ivie Vigil SECRETARY

George Best COMMITTEE MEMBER

David Lee COMMITTEE MEMBER

Don Close COMMITTEE MEMBER

*Audited Financial Statements, Minutes of the 2016 Annual Meeting, DNCU By-Laws are available.

TREASURER’S REPORT