Banks Seek To Hold Line On Community FOMs

- JEFFERSON CITY, Mo. (12/13/00) - When the banking community signed off onproposed credit union legislation two years ago to set newstandards for FOM the bankers didn't consider that the new lawwould allow some state charters to claim FOMs as large as a millionor more residents, the bankers said. "We didn't foresee it twoyears ago," Missouri Bankers Association (MBA) President MaxwellCook, told The Credit Union Journal. The MBA participated innegotiations with credit union representatives and state lawmakersin crafting the FOM bill that was eventually signed into law soonafter the national FOM statute, known as HR 1151, the CU MembershipAccess Act. "It seems to fly in the face of what the statute is allabout when they say a 'well-defined community,'" said Cook. TheCentral Communications CU application would allow the Kansas Citycredit union to serve more than one million residents in the 816area code (Kansas City); while applications for SpringfieldTelephone Employees CU, Springfield, and South Community CU, St.Louis, would allow each to serve communities exceeding 600,000.Cook said the bankers are likely to go to court to challenge thelarge FOM grants if they are not satisfied with the state'sadministrative appeals process.