In What Could Be Signal Decision, NCUA OK's Big Utah FOM

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NCUA continued to push the envelope in its community chartering last week by approving the largest community field of membership ever.

The NCUA board, in a 2-1 vote, OK'd a request from Tooele FCU, Tooele, Utah, to expand its charter from Tooele County to encompass almost two-million residents in six Utah counties: Salt Lake, Davis, Morgan, Summit, and Weber, along with Tooele. The FOM grant, which amounts to 80% of the state's sprawling population, exceeds by far the previous high of 1.4-million populations approved on at least two other community charter requests.

But just as importantly, the huge FOM grant sets a precedent for pending charter applications for two Utah state credit union giants: $2.4-billion AmericaFirst Credit Union, and $1.1-billion Mountain America Credit Union, which currently serve five and seven Utah counties respectively under their state charters. Those two credit unions, along with Goldenwest CU, all of which were targeted under this year's unsuccessful tax initiative in Utah, have applied to NCUA to convert to federal charters.

NCUA officials said the vast FOM qualifies as a single community under its rules because vitually all of it is part of the Wasatch Council (a coordinating body of five county governments) and most of the population relies on Salt Lake City for its commercial, social and religious life.

NCUA Chairman Dennis Dollar agreed that the six counties can be considered a single community. "I give great stock to the fact that the state of Utah has set up a Wasatch Council," said Dollar, who voted for the measure.

NCUA board member Joann Johnson, who also voted to approve the grant, said the fact that residents of the area rely on Salt Lake City for commercial and social needs among other things qualifies the area as a single community.

But NCUA board member Deborah Matz, who voted against it, disagreed, saying the fact all are part of the Wasatch Council does not make it a single community. She also doubted the ability of the $160-million credit union to service the entire area.

In addition, Matz said half of the counties included in the grant are not part of the Metropolitan Statistical Area as recognized by the U.S. Census Bureau.

Steve Cristensen, president of the credit union, said they plan to add another branch as well as a shared service center immediately to help serve the expanded FOM.

Cristensen said Tooele FCU-at which former NCUA board member Bob Swan was CEO prior to being appointed-has not discussed the FOM application with the other Utah credit unions and does not know what those credit unions are requesting as part of their conversions.

The NCUA board also approved applications from Members 1st FCU, Mechanicsburg, Pa., to serve 1.1-million residents in Cumberland and Franklin counties, Pennsylvania, and from Aberdeen Proving Ground FCU in Maryland to serve 325,000 people Harford and Cecil counties in Maryland.

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