Federal Credit Unions and Community Charter Conversions and Expansions

In Letter to Federal Credit Unions 21-FCU-01, the NCUA provides updated guidance and templates to assist federal credit unions seeking to convert to a community field of membership or expand their existing community field of membership. This letter replaces the guidance previously provided in NCUA Letter to Federal Credit Unions 11-FCU-03, Community Charter Conversions and Expansions.

Since 11-FCU-03 was issued, the NCUA approved several revisions to the Chartering and Field of Membership Manual to provide more flexibility to federal credit unions, including a streamlined business plan for use when applying to expand services to an area that borders a community that is currently served by a credit union.

The Letter to Federal Credit Unions contains templates for business and marketing plans, and pro forma financial statements.

“A credit union does not need to demonstrate common interests or interaction when applying to provide service to a single political jurisdiction (a city, county, or portion of one; a combined statistical area or core-based statistical area, or a portion of one that has a population of 2.5 million or less; a rural district with a population of 1 million or less; or an area the NCUA previously determined is a local community). These are presumptive communities. When applying to provide service to a presumptive community, a credit union will submit a business and marketing plan in accordance with the Chartering and Field of Membership Manual.”

If an area is not a presumptive community, follow the guidance in Letter to Federal Credit Unions 18-FCU-02, Requests to Serve a Well-Defined Local Community Using the Narrative Approach, to establish how an area qualifies as a local community and submit the documentation with the required business and marketing plan.

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