73rd annual meeting agenda

march 18, 2017

constellation fcu

1810 samuel morse drive

reston, va

call to order kermit sande, introductions chairman reading of minutes kermit sande, chairman

ceo report bobby josephson, introduction of staff ceo/president

reading of reports kermit sande, chairman

communications larry buel, secretary

awarding of door prizes john koslin, director

recognition of kermit sande,annual meeting chairman

committee

reading of nominations cindy taylor, nominating committee chairman

adjournment kermit sande, chairman

refreshments

board of directors kermit sande, chairman

cindy taylor, vice chair

karen moe, treasurer

larry buel, secretary

john koslin, director

michael o’leary, director

john luibl, director

supervisory committee

wallace beauchamp, chairperson

audra brayclayton vieg

scott gowing paul zoccola

2017 cfcu board nominees (cfcu news, web)john koslin

michael o’leary

bobby josephson, ceo/president tammy ellis, vp of operations/compliance

franz sotomayor, vp of info tech

tony maldonado, controller

robin crawford, ach/eft manager

audrey hastings-spaine, lending manager

amadou n’diaye, collections manager deanna peterman, accounting manager

milton martin, dp manager

dee munday, msr manager anne katzer, marcom manager

clark jefferson, internal auditor

angella williams

sabera alam

nadine channer audrey abelson

giovanny robinson

collin peterman

cruz ballesteros

anthony maldonado

ladonna outlaw

lola ogunfolu

victor jovel

sonya connor

fnu mutmaina

office staff

Dear CFCU Members,

In 2017, Constellation FCU celebrates 73 years of helping our members. I feel blessed to be part of CFCU’s family. It is our goal to provide you, our members, with the finest possible member service within the financial services industry. Our workforce’s top priorities are putting our Members first and understanding that consistently improving Member Value is a continuous journey. All of our employees are dedicated, focused, and work hard each day to make a difference both personally and professionally. Accordingly, I would like to sincerely thank them for their continued commitment to assist our members and build a better credit union.

We aim to provide the highest quality financial services to all federal government employees, retirees, family members, and contractors in the Washington Metro area. Our operational efficiency and strong financial position enable us to offer some of the lowest service fees and charges for services compared to other financial institutions. We offer the same low rates for new and used auto loans. In addition, we have a very efficient mortgage operation and do not charge any fees for mortgage originations, other than third party fees. We continue to provide innovative products and competitive pricing on savings and loan products.

Thank you for being a part of CFCU’s long history of success. We encourage you to share your CFCU experience with your family, friends, federal government employees and contractors in the Washington Metro area who are eligible for membership under our charter. I would also like to thank our dedicated Volunteers, Board of Directors, Management, and Staff for their commitment to serving you.

Respectfully submitted,

bobby josephson

chief executive officer/president

CEO/PRESIDENT’S REPORT

2017

branch locations

reston – main office

1810 samuel morse drive

reston, va 20190

springfield branch

7073 brookfield plaza

springfield, va 22150

carderock branch

9500 macarthur blvd., bldg. 20cabin john, md 20817

assets 12-31-16 12-31-15

liabilities & equity

12-31-16 12-31-15

STATEMENT OF FINANCIAL CONDITIONSUPERVISORY COMMITTEE’S REPORT

Dear CFCU Members,

The Supervisory Committee (SC) ensures the safe, secure, and sound operation of Constellation Federal Credit Union (CFCU) through a series of checks and balances. The SC ensures that the Board of Directors and Management of CFCU meet required financial reporting objectives and create and follow practices and procedures sufficient to safeguard members’ assets. This is achieved through SC audits, verification of members’ accounts, and review of policies and control procedures. The SC’s obligation is not to the Board or Management but to the people who are CFCU members.

Your Supervisory Committee is composed of volunteers who are members of CFCU. The Supervisory Committee members are appointed by the Board of Directors and serve a two-year term. The current Supervisory Committee members are:

Wally Beauchamp, SC Chairperson Audra BrayScott Gowing Clayton ViegPaul Zoccola

The Supervisory Committee is pleased to report that the financial position of CFCU is strong and the credit union is being operated in compliance with applicable laws and regulations. The National Credit Union Administration (NCUA) is the regulatory agency responsible for enforcing the laws and oversight of nationally chartered credit unions through annual audits. If any member finds an error in transactions, experiences a problem with financial statements, or with any services provided by CFCU that is not resolved to their satisfaction, please contact the SC immediately at the following mail/email address:

Supervisory Committee Constellation Federal Credit Union 1810 Samuel Morse Drive Reston, VA 20190 Email: CFCUSupvComm@Constellationfcu.org

Please note that the above address cannot be used for normal CFCU financial transactions, such as making deposits or loan payments.

Respectfully submitted,wallace beauchamp chairperson, constellation fcu supervisory committee

TREASURER’S REPORT

Dear CFCU Members,

WOW, time flies, it’s 2017 and Constellation Federal Credit Union (CFCU) is over 70 years old with $209+ million in assets. CFCU started in 1944 with a handful of members who had the simple philosophy of people helping people. Initially only savings and small dollar personal loans were offered. Today, CFCU has grown into a full service financial institution that offers products and services at competitive prices that most of our peers cannot beat. In 2016 we loaned out over $36.6 million with a large portion for mortgage loans. CFCU has helped hundreds of members purchase their dream homes or helped them improve their current homes. This is one way we are different from our peer credit unions who are unable to offer first mortgages or who outsource the process where we have kept the whole process in-house. This allows us to keep the rates low and fees to a minimum. Along with lending and adding new products/services over the years we have continually been building our capital to safeguard your funds. This allows us to keep offering low loan rates, rebates on VISA usage, free checking, free home banking, and free bill payer service, just to name a few.

A goal that has never wavered over the years, is to uphold a strong financial position for our membership. To do this, CFCU continually watches the financial markets, economic indicators, and runs scenario asset liability testing. We will keep striving in 2017 to meet and surpass our original goal of people helping people.

Respectfully submitted,karen moe

treasurer, cfcu board of directors

Dear CFCU Members,

Constellation Federal Credit Union continues to do well for our members. Last year ended very strong with continued loan growth and financial performance. Our net income for 2016 was $1.07 million, which was $517,928 over our 2015 net income.

However, our work is never done. While our financials are exceptionally strong, we continue to experience slow membership growth, a characteristic common among most credit unions of our size. Thus, improving membership growth is among our goals for 2017. Our other major goals include: maintaining a strong financial position; improving the quality and convenience of our products and services; improving our organization’s effectiveness, improving our facilities and infrastructure; and assuring that all aspects of sound business practices are applied to meet regulatory requirements. Your Board of Directors and Executive Leaders are committed to fulfilling these goals. Any suggestions you have to help us achieve these goals are appreciated.

It has been my pleasure to serve Constellation Federal Credit Union and you, its members and owners. I appreciate the effort and effectiveness of our other volunteers from the Board of Directors, Supervisory Committee, and CFCU Staff. A note of thanks to all of them for their considerable time and efforts to serve the members of Constellation Federal Credit Union. Have a great year!

Respectfully submitted,kermit sande

chairman, cfcu board of directors

CHAIRMAN OF THE BOARD’S REPORT

Net Loans $137,635,399 $128,864,577

Cash & Equivalents $15,246,107 $34,031,638

Investments $49,194,118 $37,620,900

Bld., Equip., Furn & Fix $4,507,490 $4,760,062

Other Assets $2,820,339 $3,582,408

total assets $209,403,454 $209,859,585

Dividends & Accts Payable

$522,561 $750,196

Regular Shares $62,214,319 $59,725,910

Share Drafts $25,086,078 $24,364,021

Money Market Shares $50,759,196 $51,045,980

IRA Shares $9,703,086 $10,435,254

IRA Share Certificates $30,325,399 $33,717,393

Total Equity $30,792,814 $29,820,831

total liability & equity $209,403,454 $209,859,585