Management Message
In 2018, we hit all our growth goals while serving the
needs of our members, sta and community. We held the
line on all member fee increases, completed two branch
renovations and welcomed two new credit unions into our
ohana, including our rst Neighbor Island branch. These
accomplishments and our plans for 2019 are summarized
below.
2018 Accomplishments:
Financial Strength – Net Income was ahead of budget at
$8.6 million. Our record income was due to healthy loan
growth, lower than expected expenses and an accounting
change for mortgage servicing rights ($2.9 million). We
also began to see the benets of rising interest rates on
our loan and investment income, which will help us in the
coming year.
Membership & Asset Growth – Membership grew to
54,637 with 31,476 checking accounts. Loans increased
$61.6 million (+13.0%) to $534.9 million. Shares increased
$35.1 million (+4.9%) to $751.8 million. Total assets reached
$868.9 million, an increase of $48.5 million (+5.9%). This
was driven by two co-branded mergers – OTS Employees
FCU ($9.7 million) and Kekaha FCU ($20.2 million).
Branches – We completed renovations of our Fort Street
and Kaimuki branches, which brought back face-to-face
member service.
Mergers added a new branch at TheBus station on
Middle Street and in Kekaha on Kauai. They signicantly
expanded member eligibility to include TheBus, Handi-Van
and all residents of Kauai.
Education & Community – Thanks to our members,
volunteers and sta, we continued our support for
Kapiolani Children’s Miracle Network, Salvation Army’s
Angel Tree, Easter community events in Kaimuki and
Waikele, Pure Aloha Festival (Las Vegas), Making Strides
Against Breast Cancer Walk, and the Honolulu City Lights,
Kaimuki and Waimea (Kauai) Town Christmas parades.
Promoting nancial literacy is a key objective. Our free
estate planning, retirement and investment seminars
continue to be very popular. The “Get REAL Financial
Reality Fair” workshops for students at Farrington and
McKinley high schools were also well received.
2019 & Beyond:
New Maui Branch – This year, we are opening our
rst branch in Kahului, Maui. The branch will be in the
Puunene Shopping Center, 70 Hookele Street, Ste. 1210,
where Target is located. Construction will be completed
by the end of the year. In the interim, we have opened a
temporary full-service branch located at 137 Kalepa Place,
Kahului. Please come by and visit. Our long-term goal is to
provide services on all the major islands.
2018 ANNUAL REPORT
(continued on pg. 2)
Management Message (Continued)
Better Share Rates & Services – On January 1, 2019, we announced a major increase in share certicate rates. We are also
developing new products and services that are scheduled to be launched before the end of the year.
Cyber Security & Infrastructure – This year, we are investing heavily to enhance our cyber security, networks and back-up
systems. While these enhancements may not be visible, rest assured that your credit union considers the safety and reliable
access to your money a top priority.
As 2020 quickly approaches, we see great opportunities for growth both organically and through mergers, but remain focused
on providing members with an exceptional experience at an aordable price. This requires people, processes and technology
all working together. We expect to deliver even more value in the years ahead. Thank you for your loyalty and support.
Mahalo & Aloha,
Gary Iwai
Board Chair
Vince J. Otsuka
President and CEO
Aloha Pacic Federal Credit Union (APFCU) is the third largest
credit union in Hawaii, with over $865 million in assets. Chartered in
1936 as the Honolulu City & County Employees Federal Credit Union,
the credit union changed its name on July 1, 2007. It continues to
serve its original charter of employees, retirees and families of the City
& County of Honolulu but has expanded to include Select Employee
Groups. NMLS #377314.
CUSO of Hawaii Ser vices LLC is a wholly owned company of APFCU
and was established in 2000. It oers residential and commercial
mortgage loan servicing to 28 credit unions. NMLS #325608.
Aloha Pacic Premier Realty, a division of CUSO of Hawaii
Properties LLC, was established in 2006. It is a full-service real estate
company providing personalized realty services to both residential
and commercial clients. RB -19315.
Aloha Pacic Financial Group, a division of APFCU, oers nancial
planning, investment and insurance advice to credit union members.
Established in 2003, it is located at 832 South Hotel Street (Main
branch) and formerly was known as Kalabash Financial.
There are no fees to join. Once a member, always a member. Even if you change jobs
or retire, you can continue to enjoy our benets. To join, you must belong to one of the
groups (or common bonds) listed below and maintain $5 in your savings account.
✥ Employees and retirees of the City & County of Honolulu; employees of Maui
County
✥ Residents of the island of Kauai
✥ Service members, civilian employees, retirees and surviving spouses of Hawaii’s
Army or Air National Guard and Department of Defense
✥ Other SEGs (Select Employee Groups) as approved by the Board of Directors
(over 2,300 groups including HGEA, Hawaii Pacic Health, Waipahu Community
Association, all Oahu COSTCO stores, Hawaii Pacic University and many others)
✥ And immediate family or household members and organizations of such persons
Members
Siblings Spouse
Parents
Children
Grandchildren
Grandparents
WHO WE ARE
WHO WE SERVE
pg.2
The 80th Annual Meeting of the members of Aloha Pacic
Federal Credit Union was held on Wednesday March 14, 2018 at
McCoy Pavilion, Honolulu, Hawaii.
Board of Directors Chair Gary Iwai called the meeting to order at
5:02 p.m. and requested that Board Secretary Darwin Hamamoto
declare a quorum. Darwin Hamamoto declared a quorum with
396 registered.
Chair Iwai welcomed the guest speaker, City Managing Director
Roy Amemiya, who addressed the members for a few minutes
about the city’s current projects. Chair Iwai thanked Managing
Director Amemiya for his informative comments.
Chair Iwai stated that the Board of Directors is responsible for
the interests of all members by setting limits and establishing the
strategic direction for management. He recognized the following
Board members, all volunteers, who were in attendance:
• Stanley Inamasu, 1st vice chair
• Allan Fujimoto, 2nd vice chair
• Darwin Hamamoto, secretary
• Robert Morita, director
• Geminiano “Toy” Arre Jr., director
Director Sam Moku was unable to attend.
Chair Iwai also introduced the following Supervisory Committee
members who were in attendance:
• Howard Okamoto
• Ben Dimond
Chair Ann Sakurao, secretary Diane Murata and committee
member Jonathan Tamanaha were unable to attend. The role
of the Supervisory Committee is to ensure the credit union’s
nancial condition is accurately represented in our nancial
statements and is in compliance with NCUA regulations.
CUSO Board members in attendance were:
• Daniel Tully, Vice Chair
• Ann Gima, Secretary
• Geminiano “Toy” Arre Jr., director
• Stanley Inamasu, director
• Allan Fujimoto, director
Chair Stanley Wachi and treasurer David Takiguchi were unable
to attend.
Chair Iwai expressed his appreciation for these honorable
volunteers, and said that he is proud to serve with these fellow
members who generously give their time and expertise with no
special benets.
Chair Iwai announced that the minutes of the 2017 Annual
Meeting are in our current Annual Report. The report is posted
online and is available at the branches and at the Registration
Desk of this meeting. He asked for a motion to approve. Allan
Fujimoto made the motion and Howard Okamoto seconded. The
2017 Annual Meeting minutes were approved as presented by
the membership.
Chair Iwai shared his thoughts on 2017’s accomplishments:
• Our assets exceeded $820 million dollars.
• Our loans had a recorded growth of $66.1 million dollars
or an increase of 16.2% for the year.
• Our dividends remained in line with other large credit
unions and are above the banks’.
• We added new products and services.
• We participated in community events, conducted nancial
education seminars, and hosted an 80th Anniversary
Celebration for members at the water park.
• Waimalu branch was successfully relocated and launched
the new face-to-face teller pod design.
• Our income increased to $5.2 million dollars.
Chair Iwai stated that looking forward we will re-invest some of
our earnings into branch renovations that will feature face-to-face
teller transactions and sta training.
• We are looking for growth in our membership and deposit
base.
• Management will actively pursue credit union partnership
mergers that will help the industry and our long-term
nancial position.
• We will focus on increasing usage of our online and mobile
channels. He encouraged the members to start using their
smartphones and devices to do banking transactions.
Chair Iwai expressed his appreciation of the members’ support
and allowing APFCU to be their primary source for nancial
advice and solutions.
Chair Iwai then introduced Vince Otsuka, president and CEO.
Otsuka welcomed the members and guests and introduced his
executive team in attendance:
• Thomas Santos, vice president of sales
• Norman Goo, vice president of lending & collections
• Kristopher Kono, vice president of risk management
• Scott Nishimura, vice president of commercial lending
• Barbara Carvalho, vice president of operations &
e-channel (later, vice president of retail operations)
Randy Shinagawa, vice president & controller, was unable to
attend.
Otsuka provided highlights on our 2017 accomplishments:
• Our Home Equity Line of Credit products were revamped
with several xed-rate tiers and continue to be the lowest
rate in town.
• Instant-issue ATM and check cards are now available at all
branches.
• Mobile application allows members to transfer funds to
other APFCU members, transfer funds among all your
APFCU accounts and make your APFCU credit card
payments.
(continued on pg. 5)
2018 Annual Meeting Minutes
pg.3
Message from Mayor Kirk Caldwell
It gives me great pleasure to send my warmest aloha to the ocers, directors, sta and members of Aloha
Pacic Federal Credit Union. Congratulations to your organization for its many achievements during 2018,
which perpetuate your enduring mission of building lasting relationships.
Our community is grateful for your commitment to education, through nancial reality fairs to educate our
youth about real-world nances and the Masami Oishi Memorial Scholarships. Mahalo nui loa for your
steadfast support of Honolulu City Lights, a spectacular holiday gift to our residents and visitors, and
charitable programs such as Kapi’olani Children’s Miracle Network and the Salvation Army Angel Tree
program.
On behalf of the people of the City and County of Honolulu, I extend best wishes to Aloha Pacic Federal
Credit Union for continued success in 2019, and sincere appreciation for your contributions to our community
and local economy.
Kirk Caldwell
Mayor, City and County of Honolulu
Treasurer’s Report
The nancial position and operating results of Aloha Pacic Federal Credit Union (APFCU) and its subsidiaries were consolidated for
the year ended December 31, 2018, and are presented in this annual report. APFCU’s ocials, management and sta consider the
safety of your funds as their top priority.
In 2018, assets increased $48.5 million or 5.9%, to $868.9 million. Shares increased $35.1 million or 4.9%, to $751.8 million. Loans
outstanding increased $61.6 million or 13.0%, to $534.9 million. The credit union’s equity of $97.9 million, or 11.3% of total assets, is
considered well-capitalized by the National Credit Union Administration’s (NCUA) standard.
Total net income in 2018 was $8.6 million, $3.4 million higher than last year. This was due to increased loan and asset growth, plus a
one-time accounting change for mortgage servicing rights. While loan losses increased, the loss percentage remains low. This is due
to the integrity and creditworthiness of our member borrowers and continued sound lending practices.
APFCU paid out $1.8 million in share dividends in 2018, which was competitive with Hawaii’s largest credit unions and banks. With
over 54,637 member-owners, APFCU continues to attract new accountholders and select employee groups. We continue to keep
member fees low and remain very competitive on loan rates. All of this while promoting nancial literacy, helping the community and
other credit unions.
We express our Aloha to our wonderful employees who worked extremely hard to service our members’ needs and volunteer ocials
who donated their time and energy to make our credit union the best.
Finally, we want to thank our valued member-owners for supporting Aloha Pacic Federal Credit Union. “When you have ALOHA,
anything is possible!”
Darwin Hamamoto
Secretary/Treasurer
Kirk Caldwell
Mayor,
City & County of
Honolulu
pg.4
• Mobile wallets with Apple, Google and Samsung Pay were
introduced.
• New partnerships with Hawaii Pacic University and
University of Nevada Las Vegas were created to increase
membership with the younger generation.
• We completed our rst co-branded merger in Hawaii with
Hawaii National Guard FCU. This allowed them to retain
their name while being a part of the APFCU ohana.
Otsuka provided information on the following 2018 projects that
will help APFCU grow in deposits and focus on superior member
service:
• Potential mergers with OTS Employees Federal Credit
Union (Oahu) and Kekaha Federal Credit Union (Kauai).
• Renovations to Kaimuki and Fort Street branches to
remove the RTS and bring face-to-face member service
teller pods.
• Sta training to provide consultative type service.
Otsuka encouraged members to volunteer at events such as the
McKinley High School nancial reality fair, where students learn
about managing their nances.
Otsuka thanked the membership for their continued support
of APFCU’s mission and vision of building lasting relationships
through excellence, as our members’ trusted source of nancial
advice and solutions.
Otsuka then announced a special presentation to recognize the
dedication of member volunteers who have served on the Board
of Directors or the Supervisory Committee. The award is named
in honor of Moses “Moke” Lum Hoy, who faithfully serviced the
membership as a director for over 45 years, from 1961 to 2006.
For 2017, the following volunteer was recognized with the Moses
“Moke” Lum Hoy Volunteer Service Award:
• Ann Sakurao, 20 years on the Supervisory Committee
Ann Sakurao was unable to attend the meeting.
Chair Iwai resumed the oor, thanked Otsuka and asked the
membership if there was any Unnished Business. There was no
Unnished Business.
Chair Iwai asked the membership if there was any New Business.
There was no New Business.
Chair Iwai advised the membership that since there were four
qualied candidates to ll the four open Board seats, there was
no election by ballot. The following candidates are existing Board
members who are approved for two-year terms:
• Allan Fujimoto
• Stanley Inamasu
• Robert Morita
• Gary Iwai
Chair Iwai encouraged the members to volunteer for committees
and programs. This would allow them to learn about the credit
union and provide community service.
There being no further business, Chair Iwai declared the Annual
Meeting adjourned at 5:54 p.m.
Respectfully Submitted,
2018 Annual Meeting Minutes (Continued)
Rhonda Aceret-Espinas
Recording Secretary
Gary Iwai
Board Chair
KEKAHA
A Division of Aloha Pacific Federal Credit Unio
n
CREDIT UNION
pg.5
Financial Statements
Financial Condition (Unaudited) Dec 31, 2018 Dec 31, 2017
ASSETS
Cash & Equivalents $ 36,178,080 $ 43,613,148
Investments 245,362,166 259,898,822
Loans 534,905,327 473,323,958
Allowance for Loan Losses
(5,490,032) (3,602,609)
Net Loans
529,415,295 469,721,349
Property & Equipment
37,481,706
32,078,354
Other Assets
20,434,897
15,102,934
TOTAL ASSETS
$ 868,872,144 $ 820,414,607
LIABILITIES & EQUITY
Accounts Payable & Other Liabilities $ 19,204,976 $ $15,219,777
Member Shares $ 751,751,460 $ 716,662,255
Equity
Regular Reserves 22,528,698 22,528,698
Undivided Earnings 70,387,010 62,153,877
Appropriated Undiv. Earn
5,000,000 3,850,000
Total Equity
$ 97,915,708 $ 88,532,575
TOTAL LIABILITIES, SHARES & EQUITY
$ 868,872,144 $ 820,414,607
Income (Unaudited) Dec 31, 2018 Dec 31, 2017
Interest Income
Interest on Loans $ 19,938,918 $ 16,943,488
Income on Investments
6,170,276 5,758,886
Total Interest Income
$ 26,109,194 $ 22,702,374
Interest Expense
Dividends to Members $ 1,817,461 $ 1,330,114
Other Cost of Funds
- -
Total Interest Expense
$ 1,817,461 $ 1,330,114
Net Interest Income
$ 24,291,733 $ 21,372,260
Provision for Loan Losses
1,926,939 1,429,055
Net Int Inc After Provision for Loan Losses
$ 22,364,794 $ 19,943,205
Non-Interest Income $ 12,008,587 $ 8,273,073
Non-Interest Expense
Salaries & Benets $ 11,574,196 $ 11,447,226
*Ofce Occupancy 3,437,042 3,422,384
**Ofce Operations 5,956,294 5,235,805
Education & Promotion 1,604,145 1,497,597
Professional Services 1,367,531 1,138,741
Insurance Fund & NCUA Operating Fees 216,688 177,950
Loan Servicing 1,034,255 1,017,418
Other (Annual Meeting, Travel, Dues, etc.)
613,879 555,989
Total Non-Interest Expense
$ 25,804,030 $ 24,493,110
Total Income from Operations
$ 8,569,351 $ 3,723,168
Non-Operating Gain / (Loss)
(832) 1,454,193
NET INCOME
$ 8,568,519 $ 5,177,361
Committees:
SUPERVISORY COMMITTEE:
Ann Sakurao - Chair
Howard Okamoto - Vice Chair
Diane Murata - Secretary
Ben Dimond
Jonathan Tamanaha
ALCO STRATEGIC:
Geminiano ‘Toy’ Arre Jr. - Chair
Stanley Inamasu - Vice Chair
Allan Fujimoto
Robert S. Morita
Samuel Moku
Vince J. Otsuka
Kristopher C. Kono
Randy Shinagawa
OPERATIONAL ALCO:
Vince J. Otsuka - Chair
Geminiano ‘Toy’ Arre Jr.
Norman Goo
Kristopher C. Kono
Randy Shinagawa
Scott Nishimura
HUMAN RESOURCES
Robert S. Morita - Chair
Darwin Hamamoto - Vice Chair
Allan Fujimoto
Stanley Inamasu
Howard Okamoto
NOMINATIONS / ELECTIONS
Stan Miyata - Chair
Stanley Inamasu - Vice Chair
Lorene Fujimoto
Contact Us:
BY PHONE
Aloha Pacic FCU
Oahu: 531-3711
Toll free: 1-877-531-3711
Hawaii National Guard CU
Oahu: 737-5714
Toll free: 1-877-218-6906
OTS Employees CU: (808) 847-8560
Kekaha CU: (808) 337-1433
BY MAIL
Aloha Pacic Federal Credit Union
832 South Hotel Street
Honolulu, HI 96813
BY INTERNET
Websites: alohapacic.com, hngcu.com, otsecu.com,
kekahacu.com
E-mail: support@alohapacic.com
DIRECTORS
To contact our board members and committee members,
please mail correspondence to:
Aloha Pacic Federal Credit Union
Attn: <Board Member’s Name>
832 South Hotel Street
Honolulu, HI 96813
*Rent, maintenance, building depreciation, utilities & taxes
**Software, hardware, furniture & equipment depreciation, card expenses, insurance & other miscellaneous
pg.6
Gary Iwai
Chair
Director Since 1997
Stanley Wachi
Chair
Director Since 2000
Vince J. Otsuka
President and CEO
Stanley Inamasu
1st Vice Chair
Director Since 2007
Daniel Tully
Vice Chair
Director Since 2001
Kristopher C. Kono
Vice President
Risk Management
Allan Fujimoto
2nd Vice Chair
Director Since 2002
Allan Fujimoto
Director
Director Since 2017
Ann Gima
Secretary
Director Since 2010
Darwin Hamamoto
Secretary
Director Since 1982
David Takiguchi
Treasurer
Director Since 2005
Norman Goo
Vice President
Lending &
Collections
Robert S. Morita
Director
Director Since 2013
Scott Nishimura
Vice President
Commercial Lending
Samuel Moku
Director
Director Since 2013
Barbara J.L.
Carvalho
Vice President
Retail Operations
Randy Shinagawa
Vice President
Controller
Geminiano ‘Toy’
Arre Jr.
Director
Director Since 2015
Stanley Inamasu
Director
Director Since 2016
Aloha Pacic Federal Credit Union - Board of Directors
Aloha Pacic Federal Credit Union - Executive Management
CUSO of Hawaii - Board of Directors
Supervisory Committee
According to the National Credit Union Administration’s (NCUA) Rules and Regulations, the Supervisory Committee is responsible for
ensuring that an annual nancial audit is conducted, verication of member accounts is performed at least once every two years, and an
annual report is prepared and presented to the members at the annual meeting.
To meet these requirements, Moss Adams LLP conducted the nancial audit in accordance with generally accepted auditing standards
and found that, the consolidated nancial statements fairly present, in all material respects, the nancial position of the Aloha Pacic
Federal Credit Union and Subsidiaries in accordance with generally accepted accounting principles. The nancial statements include our
credit union service organization CUSO of Hawaii LLC (a for-prot organization).
Other Supervisory Committee responsibilities include attending Board of Directors and committee meetings, researching member
complaints, verifying closed accounts, and monitoring the overview and ndings of the Federal Examiner, external nancial audit and
internal control program.
The Board of Directors and management have met required nancial reporting objectives and established procedures to safeguard our
members’ assets. Their dedicated eorts to serve our members ensure that our Credit Union will maintain its sound nancial condition
and continue to perform in a diligent and creditable manner.
Ann Sakurao
Supervisory Committee Chair
Darwin Hamamoto
Director
Director Since 2018
pg.7
Branch Locations:
81
st
Annual Meeting Notice
When: Tuesday, March 19, 2019 at 5:00 pm
Member registration begins at 4:00 pm
Where: McCoy Pavilion, Ala Moana Park,
1201 Ala Moana Blvd., Honolulu, HI 96814
No RSVP necessary. Gift, bento, refreshments and door
prizes for attending primary members (while supplies last).
MAIN BRANCH
832 SOUTH HOTEL STREET
HONOLULU, HAWAII 96813
Mon - Fri: 7:30 am - 5:00 pm
DIAMOND HEAD BRANCH
3949 DIAMOND HEAD ROAD
HONOLULU, HAWAII 96816
Mon - Fri: 8:30 am - 3:30 pm
KAPOLEI BRANCH
1001 KAMOKILA BOULEVARD,
SUITE 104
KAPOLEI, HAWAII 96707
Mon - Fri: 9:00 am - 6:00 pm
Sat: 9:00 am - 2:00 pm
FORT STREET BRANCH
988 FORT STREET MALL
HONOLULU, HAWAII 96813
Mon - Fri: 7:30 am - 5:00 pm
KALAELOA BRANCH
91-1179 ENTERPRISE AVENUE, A104
KAPOLEI, HAWAII 96707
Tue - Thu: 9:00 am - 2:00 pm
8254 KEKAHA ROAD
KEKAHA, HAWAII 96752
Mon - Fri: 9:00 am - 4:00 pm
WAIKELE BRANCH
94-799 LUMIAINA STREET,
UNIT 2-A2
WAIPAHU, HAWAII 96797
Mon - Fri: 9:00 am - 6:00 pm
Sat: 9:00 am - 2:00 pm
KAHULUI BRANCH
137 KALEPA PLACE
KAHULUI, HAWAII 96732
Mon - Fri: 9:00 am - 5:00 pm
KAILUA BRANCH
200 HAMAKUA DRIVE, SUITE B6
KAILUA, HAWAII 96734
Mon - Fri: 9:00 am - 6:00 pm
Sat: 9:00 am - 2:00 pm
WAIMALU BRANCH
98-1277 KAAHUMANU STREET,
SUITE 143
AIEA, HAWAII 96701
Mon - Fri: 9:00 am - 6:00 pm
Sat: 9:00 am - 2:00 pm
KAIMUKI BRANCH
3625 HARDING AVENUE
HONOLULU, HAWAII 96816
Mon - Fri: 9:00 am - 6:00 pm
Sat: 9:00 am - 2:00 pm
HENDERSON BRANCH
9555 S. EASTERN AVENUE,
SUITE 150
Las Vegas, NV 89123
Mon - Fri: 9:30 am - 5:30 pm
Sat: 9:30 am - 2:00 pm
832 South Hotel Street • Honolulu Hawaii 96813
www.alohapacic.com
ALOHA PACIFIC FEDERAL CREDIT UNION
HAWAII NATIONAL GUARD CREDIT UNION
811 MIDDLE STREET
HONOLULU, HAWAII 96819
Mon - Fri: 8:00 am - 4:00 pm
OTS EMPLOYEES CREDIT UNION KEKAHA CREDIT UNION
Visit our websites or call us at 531-3711 or 877-531-3711 toll free for more information.
alohapacic.com ◼ hngcu.com ◼ otsecu.com ◼ kekahacu.com