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Community Charter Conversions and Expansions

21-FCU-01 / January 2021
Community Charter Conversions and Expansions
Federal Credit Unions
Field of Membership
Federal Credit Unions
Community Charter Conversions and Expansions

Dear Boards of Directors and Chief Executive Officers:

The NCUA is providing 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.1 This letter replaces the guidance previously provided in NCUA Letter to Federal Credit Unions 11-FCU-03, Community Charter Conversions and Expansions.

Since we issued 11-FCU-03, the NCUA Board 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.2

The following templates are available to facilitate an application to convert to or expand an existing community charter:

Template Use
Business and Marketing Plan Use to request conversion to a community field of membership (from multiple common bond or other type), or to expand an existing community charter by more than addition of a single bordering area. (Submit Pro Forma financial statement documenting financial projections with application.)
Streamlined Business and Marketing Plan Use to request expansion to a bordering area if credit union currently has a community charter.
Pro Forma Financial Statements Use to document financial projections when requesting conversion to a community field of membership. Use is optional for expanding an existing community charter, but may strengthen an application by documenting a credit union’s ability and intent to serve a community.

Demonstrate Common Interests or Interaction

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.

Excluding a Core Area from a Proposed Community

The NCUA defines a core-based statistical area’s “core” as the most populated county or named municipality in the area. If a credit union proposes to service a community based on a portion of a core-based statistical area or combined statistical area that does not include the core area, the credit union should document why it did not include the core in the business plan. Management should base the explanation on sound legal and business judgment.

If you have any questions regarding the requirements for serving a local community or rural district, please contact the Office of Credit Union Resources and Expansion at 703.518.1150 or



Rodney E. Hood


1 This letter also applies to organizers interested in forming a new community-based federal credit union.

2 The Chartering and Field of Membership Manual is published in 12 CFR part 701, Appendix B.

Service Members Chartering
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