The annual report summarizes Educational Systems FCU's strong financial performance in 2009 despite economic challenges. Deposits and loans grew substantially. Net income was healthy and capital reserves increased, positioning the credit union for continued growth. The Supervisory Committee ensures the credit union's financial integrity and safety through independent audits and reviews of policies, procedures, accounts and operations.

1. Preserving the Dream
2009 Annual Report

3. esfcu.org
Serving the Education Community.®
1
Educational Systems FCU | 2009 Annual Report

4. Our mission is to
grow by helping
the members of the
education community
achieve their financial
goals and dreams.

5. Table of Contents
Chairman and President/CEO’s Report 5
Treasurer’s Report 7
Statements of Financial Conditions 9
Statements of Income 11
Supervisory Committee’s Report 13
Independent Auditor’s Report 15
Serving the Education Community Photo Spread 16
Board of Directors 18
Supervisory Committee / Executive Officers 19
Locations 20
Educational Systems FCU | 2009 Annual Report
Member Services 21
esfcu.org 3

6. Last year, I graduated from Prince George’s Community
College. While attending, I opened a membership with
Educational Systems FCU. Thankfully I did, Educational
Systems FCU approved me for my first car loan. Even with
research, their rates beat out all of their competitors.…

7. Chairman and President/CEO’s Report
E ducational Systems Federal Credit Union had
one of its best years ever in 2009. The Credit
Union continued to grow faster than most
other financial institutions and we are very pleased with
our performance during this troubled economy. Members
continued to bring their savings dollars to the Credit Union
operational impact on the Credit Union. Additionally, the
Credit Union’s staff has been working with members who
have been experiencing financial hardship to help them
restructure their loans and stay in their homes. We are
proud that we are helping our members work through
these troubled times.
by the millions, and earnings, which are used to grow
reserves, kept pace to ensure the Credit Union remains Educational Systems Federal Credit Union is entering
safe and sound. It is a testament to the vigilance of the its 55th year of serving the education community. All
volunteers and staff of the Credit Union that we continue of our volunteer Directors and committee members
to prosper during these tough economic times. dedicate a significant amount of time every month serving
you, our members, to ensure that your Credit Union
During 2009, we all witnessed unprecedented economic is safe and sound. It is by their selfless and supportive
conditions affecting our members, our Credit Union, and volunteer efforts that your Credit Union has continued
our country. Unemployment numbers hit the highest level to thrive. Service as a volunteer is rewarding. Members
in thirty years; stock market indexes hit the lowest levels in are encouraged to participate and if you are interested
a decade; real estate values declined dramatically; major in learning more about serving your Credit Union please
companies sought and received government bailouts; contact the President/CEO.
corporate malfeasance of well-established financial firms
continued to make headlines; and new government Your Credit Union will continue to provide you with
regulations in reaction to the crisis was more significant excellent service, competitive rates, and relevant financial
Educational Systems FCU | 2009 Annual Report
than seen in half a century. There were many challenges, education for your entire family. In times like these, it is
and Educational Systems Federal Credit Union is proud our pleasure to provide you, our members, with a safe
to be at your side helping to protect and preserve your haven for your savings and a convenient source for loans.
financial goals and dreams.
Respectfully submitted,
The economic firestorm during the past two years has
affected all financial institutions, and your Credit Union
was no exception. Issues such as increasing loan losses Rosemary Brinkley, Chairman
from members under financial distress, fraud perpetrated
by a financial business partner, and the decreasing value
of mortgage securities have all impacted the Credit Union. Chris Conway, President/CEO
Fortunately, our staff and volunteers have been proactive
in addressing these threats to mitigate their financial and
esfcu.org 5

8. After the economy took a turn for the worst, our family began
feeling the pressures of the current recession. Expenses that
use to be minimal for us, were now huge! When we began
experiencing this, we immediately contacted our Credit Union.
I’d read about the Balance Financial Fitness Program, and how it
could help you out. Balance helped my family to get on a budget
spending plan that has changed our lives forever.…

9. Treasurer’s Report
I n 2009, a year when our nation’s economy
experienced one of its worst recessions in modern
history, Educational Systems Federal Credit Union
continued its track record of financial success.
Member deposits increased by $38 million, or 16.12%, in 2009
During a financial market full of turmoil in 2009, your Credit
Union continued to offer loan rates and pay dividend rates
that were highly competitive with other financial institutions.
The continued strength that the Credit Union has been able
to maintain through these troubled financial times will enable
the Credit Union to continue to serve the education community
representing the most significant increase in member deposits in for many years to come. We all recognize that 2009 was full
over 5 years. During this time of financial uncertainty, our increase of catastrophes, which the Credit Union continues to work
in deposits shows just how much confidence our members have through, and there are signs that 2010 will also be just as
placed in their Credit Union. Loan growth continues to be a vital challenging. However, you can rest assured that your Credit
part of the Credit Union’s financial health. In 2009, the Credit Union is sufficiently positioned to meet the challenges that the
Union saw net loans increase by $16.6 million, or 9.05%. Although economic and regulatory environment might bring forward. The
the Credit Union experienced net loan losses in 2009 of .56% financial strength of our reserves, the security of our federal
compared to 2008 when net loan losses were .18%, the Credit and additional private insurance and our excellent management
Union’s losses were just over half of those of the Credit Union’s team makes Educational Systems Federal Credit Union a financial
peer group who had losses of .98%. Net Income in 2009 was a institution in which you can have much confidence.
healthy $2.59 million which has increased the Credit Union’s total
Capital reserves to $31.8 million or 9.55% of average assets. This This Annual Report includes an Unqualified Opinion from the firm
is important because this growth in Capital allows for growth of of Deleon & Stang, CPA on the Statement of Financial Condition
one of the Credit Union’s most important measures of success, and the Statement of Income and Expenses. These are excerpts
asset growth. In 2009, the Credit Union’s assets grew by an from the annual Independent Auditor’s Report for 2009 which was
additional $51.8 million, or 18.4%. In last year’s Annual Report, issued in February of 2010.
Educational Systems FCU | 2009 Annual Report
we anticipated the next significant asset growth milestone to be
$300 million and as of the end of 2009 the Credit Union’s total Respectfully submitted,
assets are over $333 million!
Maurice Erly
Treasurer
Members
Total Assets Loans to Members Shares and Savings Members’ Equity
(in millions) (in millions) (in millions) (in millions)
350 200 300 35
300 250 30
150
$199.4
$333.0
250 25
$273.8
$182.8
200
$30.7
$165.1
$280.4
$235.8
$27.4
$27.1
200 20
$248.8
$148.8
$209.1
$24.2
$230.0
100 150
$196.6
150 15
100
100 10
50
50
50 5
0 0 0 0
2006 2007 2008 2009 2006 2007 2008 2009 2006 2007 2008 2009 2006 2007 2008 2009
esfcu.org 7

10. I’ve been a second grade teacher in Southern Maryland
for five years. I was so excited to find out about
Educational System FCU’s In-School Branch Program.
My students are eager to bring their deposits every
Wednesday. It excites them to see their money grow.
I’m so happy that Educational Systems FCU is committed
to teaching our children the importance of money
management.…

11. Statements of Financial Conditions December 31, 2009 and 2008
2009 2008
ASSETS
Cash and cash equivalents $ 38,975,369 $ 14,706,348
Loans to members, net of allowance for loan losses 198,468,551 181,968,927
Investment securities
Investment securities available-for-sale 41,775,954 48,544,946
Investment securities held-to-maturity 26,074,678 26,125,899
Other investments 8,484,267 1,591,385
Accrued interest receivable 506,326 574,186
Other receivables 11,270,128 743,581
Prepaid expenses and other assets 2,328,120 2,050,182
Premises and equipment, net of accumulated depreciation and amortization 2,661,151 3,003,458
Assets acquired in liquidation of loans 31,317 44,245
NCUSIF share insurance deposit 2,621,241 1,014,204
TOTAL ASSETS $333,197,102 $280,367,361
LIABILITIES AND MEMBERS’ EQUITY
Educational Systems FCU | 2009 Annual Report
LIABILITIES
Accounts payable, accrued expenses and other liabilities $ 10,787,240 $ 2,060,701
Dividends payable — 138,228
Notes payable 17,951,429 14,982,857
TOTAL 28,738,669 17,181,786
MEMBERS’ SHARES AND SAVINGS ACCOUNTS
Members’ shares and saving accounts 273,761,945 235,763,247
TOTAL LIABILITIES 302,500,614 252,945,033
MEMBERS’ EQUITY
Members’ equity, partially restricted 30,696,488 27,422,328
TOTAL LIABILITIES AND MEMBERS’ EQUITY $333,197,102 $280,367,361
esfcu.org 9

12. After 15 years of service on my job, my hours were
temporarily reduced. I’ve always been able to pay my
bills, but now without as much income, I really didn’t
know how I could make my next full mortgage payment.
I contacted my Credit Union and let them know about
my current situation. Educational Systems FCU helped to
modify my mortgage payments so that I could keep my
home. Thank you so much…

13. Statements of Income December 31, 2009 and 2008
2009 2008
INTEREST INCOME
Member loans $12,184,332 $ 11,175,708
Investment securities 3,753,205 3,987,488
TOTAL INTEREST INCOME 15,937,537 15,163,196
INTEREST EXPENSE
Members’ share and savings accounts 5,235,561 5,710,412
Borrowed funds 629,495 514,410
Total interest expense 5,865,056 6,224,822
Net interest expense 10,072,481 8,938,374
Provision for loan losses (1,426,892) (591,467)
NET INTEREST INCOME, AFTER PROVISION FOR LOAN LOSSES 8,645,589 8,346,907
NON-INTEREST INCOME
Fees and other charges 8,809,533 8,223,642
TOTAL NON-INTEREST INCOME 8,809,533 8,223,642
Educational Systems FCU | 2009 Annual Report
NON-INTEREST EXPENSES
General and administrative 8,655,124 7,849,521
Compensation and benefits 4,535,401 3,782,302
Office occupancy and operations 1,374,394 1,206,026
Professional and outside services 518,032 306,606
Federal operating fees 66,378 63,261
Association dues 43,388 57,476
TOTAL NON-INTEREST EXPENSES 15,192,717 13,265,192
NON-OPERATING EXPENSES (INCOME)
Non-operating (gains) losses (323,184) 900,923
Total non-operating expenses (income) (323,184) 900,923
NET INCOME $ 2,585,589 $ 2,404,435
esfcu.org 11

14. When our daughter turned 18, driving was the only
thing on her mind! We couldn’t afford to purchase a
New Car for her to get back and forth from college,
but could afford a Used Car. We were pleased to learn
about the partnership that Educational Systems FCU has
with Enterprise Car Sales! We found a great car that was
within our budget at an even better rate.…

15. Supervisory Committee’s Report
I n accordance with the Federal Credit Union
Act, the primary mission of the Supervisory
Committee is to conduct internal and
external audits designed to determine that: (1) accounting
records and reports are prepared promptly and accurately
reflect operations and their results; (2) established internal
Overseeing the review of management practices and
procedures is an important role and is critical to the
safeguarding of all members’ assets. Your Supervisory
Committee monitors regular updates to Educational
Systems Federal Credit Union’s policies and procedures.
Regular reports are submitted to the Board of Directors
controls are effectively maintained and adequately for their analysis and actions regarding the safety and
protect the Credit Union, its members, its management, soundness of these policies and procedures.
its employees; and (3) each unit of the Credit Union is
carrying out the plans, policies, and procedures for which Periodic member account verifications are also conducted
it is responsible. to insure the integrity of Educational Systems Federal
Credit Union’s account database. Moreover, the
Educational Systems Federal Credit Union continues Committee monitors internal controls and external safety
to grow and our operations continue to become more and soundness operations with site visits to all Educational
complex. The Committee has a full-time Director of Internal Systems Federal Credit Union branches and departments.
Audit to assist us as we carry out our mission. During In addition to observing physical branch operations,
2009, our internal auditor performed comprehensive, in- Committee members and branch employees have the
depth audits and reviews of our departments, branches, opportunity for direct interaction with regard to concerns
products and services. As we move forward into 2010, and ideas for improvement.
please rest assured that your Supervisory Committee will
continue to focus on maintaining our position as a safe, The Committee requests that members with concerns contact
Educational Systems FCU | 2009 Annual Report
sound and strong credit union. the Supervisory Committee, in writing, at the following
address: P.O. Box 179, Greenbelt, MD 20768-0179.
The Committee ensures that financial statements
accurately and fairly represent the financial conditions of Respectfully submitted,
the Credit Union. For this purpose, a complete annual audit
is conducted. Deleon & Stang Certified Public Accountants
has provided the Board of Directors and Committee W. Cecil Short
with audit findings and recommendations in accordance Chairman, Supervisory Committee
with generally accepted principles. At the conclusion of
the annual audit, the Supervisory Committee Chairman Michele Winston, Secretary
reviewed Educational Systems Federal Credit Union’s audit Alonia Sharps, Committee Member
analysis with the National Credit Union Administration
(NCUA) Examiner.
esfcu.org 13

16. When my husband lost his job this fall, our family’s household
income went down tremendously. With our income decreasing
so drastically, it really made it difficult to pay all of our bills
on time. When I contacted Educational Systems FCU to explain
our situation, they helped our family get back on track with
financial advice and options to help bring our bills current.
We are so grateful…

17. Independent Auditor’s Report
Board of Directors and
Supervisory Committee
Educational Systems Federal Credit Union
Greenbelt, Maryland
We have audited the accompanying statements of financial condition of the Educational Systems Federal Credit Union as of
December 31, 2009 and 2008 and the related statements of income, changes in 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 that our audit provides 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 the
Educational Systems Federal Credit Union for the years ended December 31, 2009 and 2008, and the results of its operations
Educational Systems FCU | 2009 Annual Report
and cash flows for the same periods, in conformity with accounting principles generally accepted in the United States of America.
As discussed in Note 17 to the financial statements, the Credit Union, as an insured claimant, is a co-defendant in a declaratory
judgment action filed by Cumis Insurance Society, Inc. in the United States District Court for the Western District of Wisconsin,
and it has filed a counter declaratory judgment and breach of contract action in the United States District Court for the District
of Maryland. Preliminary hearings and discovery proceedings on both actions are in progress. The ultimate outcome of the
matter cannot presently be determined. If unfavorable, the outcome of the matter would concretize a loss of up to nearly
$5 million apart from legal fees, which is not reflected in the accompanying financial statements.
DeLeon & Stang
DeLeon & Stang, CPAs
Gaithersburg, Maryland
February 17, 2010
100 Lakeforest Blvd., Suite 650 • Gaithersburg, MD 20877 • Phone 301.948.9825 • Fax 301.948.3220 15
email: info@deleonandstang.com • www.deleonandstang.com

18. Serving the Education Community
1 5
2 6
3 7
4 8
1 DeLoria Savoy, AVP Member Services, taught the young men 5 Left to right: Lydia Gray, Marketing Coordinator; Elozino
of Sky Walker Flight School Football Camp the importance of Ahworegba, Spelling Bee Winner; Vic Samuels, VP Marketing.
managing their finances.
6 Marketta Lewis, Senior Member Service Representative,
2 Educational Systems FCU Management Team with Enterprise California Branch, assisting students at the Margret Brent
Car Sales partners. Educational Systems FCU accepted the MVP Middle In-School Branch Grand Opening.
award for most vehicles sold during a car sale!
7 Kenberly Johnson, School Financial Education Coordinator;
3 Left to right: Mary E. Harris, Marketing Manager; Victoria Hochstein, Dr. Charles Ridgell, St. Mary’s Board of Education Director of
Graphic Designer; Vic Samuels, VP Marketing; Jennifer Brown, Curriculum and Instruction, at Margaret Brent Middle In-School
Marketing Assistant; Lydia Gray, Marketing Coordinator; Antonio Branch Grand Opening.
Boone, Academy of Finance Summer Intern.
8 Left to right: Zipporah Miller and son; Lydia Gray, Marketing
4 Left to right: Kenberly Johnson, School Financial Education Coordinator; Coordinator, and Jennifer Brown, Marketing Assistant at the
Tiffanie Montgomery, Branch Manager, Prince Frederick Branch; Sonya 2009 Prince George’s County Annual S.T.E.M Fair.
Kennedy, Branch Manager, Bowie Branch helped during new student
orientation at Prince George’s Community College.
16

19. 9 12
10
13 14
11
15
Educational Systems FCU | 2009 Annual Report
9 Student competitor and judge at the 2009 Prince George’s 12 Staff holiday toy drive donations were made to Children’s
County S.T.E.M Fair. National Medical Center. (Left to Right: Wanda Johnson, Accountant
II; Jennifer Brown, Marketing Assistant; Ingrid Ramirez, Mortgage
10 Left to Right: Dana DeFilippo, Bowie Baysox Community
Loan Coordinator; Nahid Moghadam, VP Member Services; and
Coordinator; Louie, Bowie Baysox Mascot; Corrine Fisher, Read
Tameka Edmonds, Loan Quality Control Coordinator).
and Hit a Home Run Poster Design Contest Winner; Lydia Gray,
Marketing Coordinator, Educational Systems FCU. 13 Caleb-Rey Blancaflor, Read and Hit a Home Run Poster
Design Contest Winner and Family.
11 Dorecia Waisome, Senior Member Service Representative,
Waldorf Branch celebrates with Mrs. Virginia McGraw, 14 Great Mills High School student Manuel Laungayan enjoying
J. P. Ryon Elementary Principal. The Washington Post a hotdog while showing off high school and Credit Union spirit!
2008-2009 Distinguished Educational Leadership Award for
Charles County was presented to Mrs. McGraw who is also 15 Aerial view of DeLoria Savoy, AVP Member Services,
one of our In-School Branch Principals. Mrs. McGraw received Educational Systems FCU, conducting a financial workshop with
the Principal of Excellence award. the parents at the 2009 Prince George’s County S.T.E.M Fair.
esfcu.org 17

20. Board of Directors
Rosemary Brinkley, Chairman
Ms. Brinkley is a retired educator and administrator from Prince George’s County
Public Schools and a former educator with Charles County Public Schools.
Eva Chesley, Vice Chairman
Mrs. Chesley is a retired educator from Charles County Public Schools.
Maurice Erly, Treasurer
Mr. Erly is a retired educator and administrator from Prince George’s County Public Schools.
Dr. Jerome Clark, Secretary
Dr. Clark is a retired educator, administrator, and past Superintendent of Prince George’s
County Public Schools.
John Neville, Director
Mr. Neville is an educator and administrator with Prince George’s County Public Schools.
George D. Denny, Jr., Director
Mr. Denny is a retired educator, counselor and administrator from Prince George’s
County Public Schools.
Alonia Sharps, Director
Mrs. Sharps is currently an administrator with Prince George’s County Community College.
18

21. Supervisory Committee and Executive Officers
Cecil Short, Chairman, Supervisory Committee
Mr. Short is a retired educator and administrator from Charles County
and Prince George’s County Public Schools.
Michele Winston, Secretary, Supervisory Committee
Mrs. Winston is currently an Internal Audit Supervisor with Prince George’s County
Public Schools.
Alonia Sharps, Member, Supervisory Committee
Mrs. Sharps is currently an administrator with Prince George’s County
Community College.
Chris Conway
President/Chief Executive Officer (standing, center)
Girado Smith
Educational Systems FCU | 2009 Annual Report
Senior Vice President/Chief Financial Officer (standing, right)
Wayne Beall
Vice President/Chief Information Officer (standing, left)
Laura Eacho
Vice President of Lending & Collections (seated, left)
Nahid Moghadam
Vice President of Member Services (seated, right)
Victoria Samuels
Vice President of Marketing (seated, center)
esfcu.org 19

22. Locations
CORPORATE OFFICE
MAILING ADDRESS
P.O. Box 179
Greenbelt, MD 20768-0179
Toll Free: 800.356.6660
BRANCH OFFICES
BOWIE
Duvall Village Shopping Center
4801 Glenn Dale Road
Bowie, MD
UPPER MARLBORO
Washington Plaza One
8903 Presidential Pkwy., Suite 100
Upper Marlboro, MD
WALDORF
Smallwood Village Center
169 A Smallwood Village Center
Waldorf, MD
GREENBELT
Maryland Trade Center One
7500 Greenway Center Drive, Suite 140
Greenbelt, MD
*CALIFORNIA
San Souci Plaza
22599-122 Macarthur Blvd.
California, MD
*PRINCE FREDERICK
Manning Building
90 King George Way
Prince Frederick, MD
*No Teller Services
20

23. Member Services
SAVINGS FOR YOUR CONVENIENCE
Checking Accounts Free Online Banking and BillPayer
Certificates Free eStatements
Special Purpose Club Accounts Free Online Check Copies
Money Market Accounts Free Online Stop Payments
Traditional and Roth IRAs Visa Debit Cards
Coverdell Education Savings Audio Response Teller (ART)
Direct Deposit
LOANS
Payroll Deduction
New, Used and RV Loans
Personal (Signature) Loans INSURANCE COVERAGE
First Trust Mortgages Share Insurance ($500,000)*
Second Trust Fixed Rate Mortgages IRA Share Insurance ($500,000)*
Home Equity Lines of Credit (HELOC) Credit Life Insurance**
AlertLine (line-of-credit) Credit Disability Insurance**
®
Visa Classic and Double Platinum Credit Cards Group Discount Auto/Home Owners**
Route 66 Auto Warranty
Other Insurance Programs Available**
ADDITIONAL MEMBER SERVICES
Signature Guarantees
Travelers Cheques
Money Orders
Financial Seminars
Balance Financial Fitness Program
UBS Car Buying Service
Savings Bonds
* Your deposits are insured up to at least $500,000. The first $250,000 is federally insured by the National Credit Union Administration
(NCUA), and backed by the full faith and credit of the United States Government. An additional $250,000 of coverage is provided by
Excess Share Insurance (ESI), a private corporation. Traditional and Roth IRAs are insured up to $250,000 by NCUA, and up to an
additional $250,000 through ESI, all at no cost to you.
**Member purchased at group rates.

24. P.O. Box 179 • Greenbelt, MD 20768-0179
800.356.6660 • www.esfcu.org