HAWTHORNE, Calif. – FAA First Federal Credit Union announced last week that it has been approved by NCUA to expand its field of membership to serve the entire air transportation industry, making it the eighth such credit union to receive a Trade, Industry or Profession (TIP) charter since NCUA passed the regulation allowing the new charter more than a year ago. Bankers decried the TIP charter as too expansive and moving CUs even further away from a true “common bond.” Included in FAA First’s new TIP charter are all Federal Aviation Administration and Transportation Safety Administration employees, as well as those working in airports who directly support the air transportation of people or freight. The field of membership includes nearly two million potential members, according to Rivera. Interestingly, of the eight TIP charters approved so far, three have been for the air transportation industry. The credit union currently has 23,000 members and $255 million in assets. Prior to the TIP approval, FAA First served only the employees of the FAA and TSA in the Western half of the country. “We’re laying out plans right now,” FAA First Federal Credit Union CEO Eileen Rivera said. “Already we’ve identified associations and aviation related trade associations.” She noted that in the beginning FAA First is particularly going to begin targeting the Eastern half of the country. The credit union’s application was about five to six months in the process, Rivera said. She stated that it seemed the process could be a bit more streamlined, but it may have been impacted by the relocation of NCUA’s San Francisco regional office to Tempe, Ariz. and the shuffling of employees. Initially, she said NCUA might have had some reservations about the application package because FAA First primarily serves its members online, through ATMs, and shared branches. The regulator turned its view around when the credit union explained that their membership preferred this type of service because of the odd hours and various locations many airline employees work. “The credit union has continuously focused its efforts on the enhancement of electronic access, rather than relying primarily on branch offices to provide service,” Rivera said. “We’ve always focused on allowing members to bank on their preferred hours, rather than conform to ours. This approach has been successful with the FAA and can be applicable to the rest of the air transportation industry.” Rivera added that once two other credit unions, American Airlines and NWA, were approved for the same field of membership and started marketing to FAA First’s membership and potential membership base, they were able to lean on NCUA more to push the application through. Though only eight CUs have taken advantage of the TIP charter so far, more may if those that have gone before them experience success with the new charter. Nebraska Energy Federal Credit Union CEO Roger Hake, whose credit union was approved for the Nebraska energy industry TIP in February, explained why his credit union was interested in expanding its field of membership. “Diversification, by all means,” he said. “I believe there are a lot of people in Nebraska who don’t belong to a credit union who would like to and we get to stay within our niche.” Additionally, Hake pointed out, there are other credit unions in the area serving the utilities industry-Nebraska is the only state left with entirely public power-but they do not provide all the services Nebraska Energy does, specifically mortgages. The credit union wants to provide these services, “but we don’t want to step on everybody’s feet,” he said. Nebraska Energy’s primary marketing strategy will be word of mouth for two reasons, Hake explained. First, the credit union does not want to grow too fast; and second, “I don’t want to come across as being too aggressive. I don’t much care for that.” In just the first few months, Hake said, Nebraska Energy has experienced an uptick in membership growth. He also said that some groups have asked for membership applications to hand out. Hake commented that the process, which is entirely new since the regulation just became effective a year ago May15, would have been easier if they had a model to follow. In fact, he said Georgia Power Federal Credit Union asked for Nebraska Energy’s package as a guide for its own. The NCUA Board unanimously approved Interpretive Ruling & Policy Statement 03-1 at its March 27, 2003 board meeting. In addition to creating this TIP, the IRPS eliminated overall protection requirements, standardized criteria for determining a community, and allowing state chartered credit unions that converted to federal charters to maintain the groups added through emergency mergers, among other things. [email protected]

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