• Statements of Income
• Statements Of Financial Condition
• Chairman's Report 2009
• Treasurer's Report 2009
• Supervisory Committee's Report 2009
• President's Report 2009

Annual Report 2009

Statements of Income
Years Ended December 31, 2009 and 2008

Statements Of Financial Condition
Years Ended December 31, 2009 and 2008

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Chairman's Report 2009

2009 was one of the busiest I can remember for the Board and staff. In the midst of the recession we recovered from a fire in our building, changed our name, continued to roll out new services, and dealt with the financial fallout of the regulatory recovery actions taken by the NCUA, our Federal regulator (similar to the FDIC for banks).

Due to a fire on a lower floor of the building housing our Main Office in late 2008, we started the year in our Disaster Recovery location, with little idea of when we could return. We were able to continue operations seamlessly and return to normal by the end of 1Q09. This was a tremendous effort on the part of our Staff and infrastructure and disaster recovery partners. An outage of this type and duration would have shuttered many organizations, at least temporarily, yet Metro continued serving our Members without a hitch.

After nearly forty years as IBM Metro Employees Federal Credit Union, we decided to change our name to reflect our changing Membership. While originally created solely for IBM Employees, over the years we have added many other employers and employee groups to Metro's membership. While IBM employees and families remain our largest group, we have several significant groups who we felt would be better served by a more inclusive name. "Greater Metro Federal Credit Union" retains our link to "IBM Metro" yet better reflects our changing Field of Membership and a future focused on providing better products and services to all our members.

There is continued dreary news on the fallout from Federal recovery actions. Credit Unions have our own Federal regulatory system, including our own insurance fund run by the NCUA (National Credit Union Administration). While Metro has not invested in nor held any "toxic assets" or derivatives, we are forced to share the costs for those credit unions that did and have failed or are failing. These are not small numbers, over $500K in regulatory "expense/losses" to date. We are certainly strong enough to weather this yet it is a serious and ongoing concern. Please see our Treasurer's Report for more details on our financial performance.

On the bright side we continue to try to server our members better, such as the new ATM in the lobby of the VA Hospital in Manhattan, our new name and logo and improvements coming to our website.

I want to thank our staff and volunteers for an exceptionally challenging year at Metro as we look forward to no less a challenge in 2010.

Sincerely,

Robert G. Morrison
Chairman

Treasurer's Report 2009

In reviewing the 2009 financial performance of your credit union I would categorize it as a transition year, still filled with uncertainty regarding consumer confidence, financial policies and unemployment. Our Members are very cautious (as they should be) in spending and living within their means. So, in 2009 we have seen a large decrease in loan activity and a huge increase in savings.

On January 1, 2009 we were in a recession. The economy continued showing the effects and damage created by the Sub-Prime Mortgage and Derivative Securities markets. The stimulus package did little to reduce the almost 10% unemployment rate. Numerous financial service and mortgage companies, banks and credit unions closed or were taken over due to their large toxic investments.

Greater Metro FCU did weather the storm in part due to the sometime conservative nature of the board, who is always thinking of our Members First! I feel confident saying once again that your credit union had a better year than most.

The financial highlights for 2009 included:

• Assets increased by $16mm
• Member Deposits increased by $16.4mm
• Member Equity increased by $86k

This is not to say that the year did not have its challenges, for your credit union or the credit union industry as a whole. Although your credit union's commitment to serving its members helped it avoid chasing the exotic investment & loan products that outsmarted the biggest and brightest Banks and Wall Street institutions, we weren't able to come away scot free. By operating within the Credit Union Corporate system we were required to maintain capital with the Corporate. Their losses had to be offset by our investment. Also, the Insurance Fund that guarantees our member deposits also funds the Corporate bailout as administered by our regulator, the NCUA. This will be an ongoing annual non-operating assessed charge and a drain on our bottom line.

This annual report contains more of the financial details and the auditors report for 2009. Take a look through the report and feel free to contact me at vdagostino@greatermetrofcu.org if you have any questions or comments regarding the financial details.

One fact that deserves mentioning is that we started the year 2009 working from a disaster recovery site longer than we expected. Our management and staff did a very good job operating from our backup disaster site. We owe a big thank you to Progressive Credit Union in Manhattan for their assistance and hospitality during the recovery. "People helping People" is a credit union motto but in 2008 - 09 we at Greater Metro FCU learned it is more than just a cute motto - it is what credit unions do!

We look forward to better times in 2010. Our 40th Anniversary in November will provide us a moment to celebrate how far our Credit Union has come, but more importantly, will give us a new starting point to see how far we can go in providing the very best products and services to our members. We greatly appreciate the opportunity to serve and hope to live up to Greater Metro's new positioning statement "Where Our Members Come First!"

Respectfully Submitted:
Vincent D'Agostino

Report of the Supervisory Committee 2009

The Credit Union Supervisory Committee consists of volunteer members appointed by the Board of Directors, plus a Board liaison and acts as a link between the board, management, and the membership. In 2009 the volunteers were Lisa Belifore, Chairperson, Thomas McCarthy, Steven Goldberger, Andrea Nelson, and Marco Resendiz. Robert Ambrose was the Board liaison. In addition to providing a link to the members, the Supervisory Committee is also responsible for conducting an internal audit and to review that management is effectively carrying out the plans and policies established by the Board. The Supervisory Committee again retained the outside accounting firm of Wojeski and Company to audit the Credit Union's practices and internal controls, and to render a decision on the financial reports that Management prepares. Management again received an unqualified opinion audit, indicating that Wojeski is comfortable with the reporting done by the Credit Union's Management, and the financial condition of the Credit Union as of December 31, 2009.

To provide an extra level of comfort, the Committee has retained the services of Wojeski and Company, who provided us with the services normally performed by an internal audit function. Monthly, an accountant from Wojeski and Company makes an on-site visit to the Credit Union to review particular aspects of the Credit Union's operation. A strict schedule has been prepared and approved to assure that all operations of the Credit Union are reviewed multiple times during the year.

The Supervisory Committee is established to serve all members, and to respond to any concerns or questions that may arise. The Committee may be independently contacted at:

Supervisory Committee
Greater Metro Federal Credit Union
31-10 37th Avenue, Suite 403
Long Island City, New York 11101

Lisa Belifore
Chairperson

President's Report - 2009

The year began with operations being conducted from our disaster recovery site. In effect, our 2009 truly began when we returned to our main headquarters at the end of the first quarter. All of our 2008 year-end requirements needed to be pushed back and were completed in time for our 2008 annual meeting last July. Our name change became official in August. It was also in August that the first round of legislative changes in consumer protection took effect. These changes were a reaction to practices engaged in by non credit union institutions that regularly took advantage of their customers. The most extreme cases cumulatively led to the financial industry meltdown and the subsequent government bailouts. The changes, however, created a burden on financial institutions and required additional modifications as it was realized that although well intentioned, quick fixes brought unwarranted and unanticipated problems with their implementation.

The Credit Union industry suffered losses as well. Although not yet at the natural person credit union level, the Corporate system, which is covered by the same insurance fund guaranteeing our member deposits, incurred losses. Our "Corporate" system needed "bailing out" and each natural person credit union such as Greater Metro was assessed a share of that bailout. With confusion at the government level, the calculation and the rules for recording the assessment were finalized in mid 2009. Greater Metro, given a choice, recorded the charge in 2008. We have budgeted for this non-operating expense which will be a drain on the credit union's bottom line for the foreseeable future. Not only were natural person credit unions charged with a regulatory assessment, but in many instances the required invested capital in individual Corporate Credit Unions was lost.

So through it all, how did Greater Metro fare in 2009? As you can see from the accompanying audited financials, Assets grew by 24% to $81.8 million primarily coming from member deposits which grew by 30%. Our statement of operations shows a net loss of $6 thousand for 2009. This loss however was driven by the non-operating event of writing down our investment in our Corporate Credit Union (their problems are referenced above). Taking this into account, Greater Metro "operations" generated just over $300 thousand in income. Finally, one of the most important barometers of how we are doing deals with safety. The NCUA establishes a minimum net worth ratio for a credit union to be considered "well capitalized". This ratio stands at 7%. Greater Metro's net worth ratio was at 14.3% at year-end 2009.

Where do we go from here? With investment rates at all time lows and little "good" loan demand, we are challenged to maintain profitability. We give everything back to our members in rates and services (as we should) and try to stay positioned for the market "turnaround". Our plans to increase good memberships among our current groups are still on course and we look at all opportunities to strengthen our institution. Liquidity and capital are non issues at Greater Metro. Utilizing them in a diligent manner for the good of the membership is what we are committed to doing for 2010 and beyond.

Peter Nalaskowski
President

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