CUNA Comment Letter

CUNA letter on community CU chartering and FOM

February 21, 2008

The Honorable JoAnn Johnson
National Credit Union Administration
1775 Duke Street
Alexandria, VA 22314

Dear Chairman Johnson:

As you know from our discussions last year, CUNA urges the agency to revisit the proposal published in the Federal Register June 5, 2007 to amend its chartering and field of membership policies regarding community chartered credit unions.

In general, CUNA strongly supported the proposal, although working with our Community Credit Union Committee, Federal Credit Union Subcommittee, and Examination and Supervision Subcommittee, we did recommend a number of amendments to improve the process for community credit unions. It is our understanding that the agency has not advanced the proposal due to concerns raised during the comment period.

In light of those concerns and in an effort to encourage the agency to proceed with consideration of additional flexibility for community credit unions, I would like to make further recommendations for changes to the current proposal which we have coordinated with a number of leagues, including the California League, and request that the Board take action on this matter.


The agency’s proposal contained several basic proponents. It would have:


Consistent with our comment letter, further review and consideration of credit union concerns, CUNA offers the following recommendations to revise the proposal. We would be glad to provide additional supporting information and analysis if that would be useful to you or your staff.

“NCUA will approve without further documentation a federal credit union’s application to serve a community it has already approved for another federal credit union. NCUA will permit such applications for a minimum of five years following the original credit union’s approval. This time frame may be extended for up to another five years, unless an intervening Census reflects material changes in the community that require documentation.”

This revised approach takes into account that communities change but would provide a longer period for applications to be approved without further documentation. However, if after the first five years of the original credit union’s application significant changes in growth patterns or community interaction have occurred, NCUA would retain the authority to determine if more documentation should be submitted.

CUNA shares your view that the community charter application process should facilitate greater credit union service to consumers. We would welcome the opportunity to work with you to address this matter and develop changes that will advance the current proposal as well as the interests of credit unions and the agency, consistent with the Act.

Thank you for your consideration of our recommendations.


Dan Mica
President and CEO