PEFCU'S RESPONSE TO NCUA'S ACTIONS

25 March 2009 12:00 p.m. Eastern

Dear Valued Member,

The nation's financial services industry has been dealing with what many consider the most difficult time since the great depression. Your credit union has been able to avoid these difficulties by focusing on our members needs and conservatively managing our risks. Unfortunately, some of our credit union partners have not been as successful in avoiding financial losses.

Earlier this year, two of our corporate credit union partners were placed into conservatorship by our regulator, the National Credit Union Administration (NCUA). As a result of these financial losses by our corporate partners and mandate by the NCUA, our 2009 net income performance will not be reflective of the strength and soundness of your credit union. PEFCU's 2009 expense impact from the corporate system financial issues was neither planned nor projected, but is the right thing for credit unions to do, in true cooperative spirit. PEFCU will continue to make every effort to absorb this expense with very little impact to our members by meeting your deposit, lending and transaction needs just as we have for the past 40 years.

As a PEFCU member, you can be assured that your credit union is operating in a sound financial manner. PEFCU is a well-capitalized credit union that provides a strong insurance package for our members with the NCUA insurance and an additional $250,000 in deposit insurance that only financially strong organizations are allowed to provide. Our balance sheet and income statement will continue to be posted on our Web site and in our branch lobbies every month. I am personally available to discuss our financial results with you. We strive to be your trusted partner during this difficult economic environment and I feel it is important to share this information with you so you better understand this situation.

Sincerely,

Bob Falk

President/CEO