When NCUA announced the availability of the new TIP (Trade,Industry, and Professional) charter, many thought two things wouldhappen immediately. First, that credit unions would rush to embraceit. Second, that the banking industry would add this FOM move tothe long (and growing) list of CU initiatives which they stronglyoppose. The first did not happen. The second predictably didhappen. After all, the banking industry nowadays opposes everythingcredit unions do right down to challenging their right to exist.When first announced, TIP seemed like a natural. It reminded me ofwhat I found during my very first trip to visit with credit unionsin Australia many years ago. There was a credit union in eachAustralian state to serve the educational community. Another toserve all law enforcement personnel in the state. And still anothermade up of members who worked for the government. Seemed like agood idea back then and still does today in light of thesimilarities with what is available under the TIP approach tomembership. Like others, with the TIP charter I could visualizethat someday in this country, like Down Under, there would be atleast one credit union authorized to serve all those involved in,for example, education, law enforcement, and government work. Butgoing a step further, also a credit union for all militarypersonnel, or at least one of the individual military branches suchas the U.S. Navy. Come to think of it, that credit union alreadyexists. It's called Navy Federal Credit Union which at close to $22billion in assets is the largest credit union in the world. And itgot there without the benefit of TIP. Then just recently, afternearly 50 years of being chartered to serve Pease Air Force Baseand seven years after being approved as a community charter,Service Credit Union (SCU), a $900 million CU located inPortsmouth, New Hampshire, was granted an FOM to include all U.S.Military and civilian employees of the Defense Department acrossthe globe. Although not technically a TIP charter, it sure soundslike one. TIP or not, with this kind of potential, could SCUsomeday end up challenging Navy Federal for the top spot? Prettydoubtful. Navy Federal didn't get where it is today by being theonly credit union organized to serve the U.S. Navy. There arehundreds of credit unions that at one time were primarily militarybased. Today, many of these are quite large and many of them servemembers connected in some way to the navy. What I, and possibly thebankers, initially overlooked about TIP is that it comes with aprice. Credit unions that choose to get involved with this newestapproach to expanding FOMs have to give up something, like certaingroups and types of members they had been serving but can no longerdo so except those grandfathered. Maybe that's one reason why therehasn't been nearly as much interest shown in TIP so far? It seemsthat the TIP approach would have had much more potential if acredit union started out that way such as those in Australia. It iseasy to visualize separate credit unions for construction workers,for example, but not to be confused with present day billion dollarcredit union CEFCU. The first two letters of that acronym stood fordifferent things over the years including initially CaterpillarEmployees. Later CE stood for Construction Employees, but not inany TIP sense. (Today the first two letters stand for CitizensEquity.) Carried to extremes, the list of so-called single sponsortrades, industries, or professions (TIP) could be endless. Therecould be a credit union for anyone connected to the media, theaccounting profession, those in the transportation industry, andthe staggering number of people connected in some way to the foodindustry. Also, those involved in any way with the legal profession(any one who has ever sued or been sued?), the gigantic retailindustry, health care, anyone relating to education, the sprawlingentertainment industry, the travel industry, and even a CU forCatholics (or better yet, anyone who profess to believe in God, anyGod). Let your imagination go wild. Such FOMs could be welldefined, or structured in the broadest terms. Back to reality.Looking at the small list of credit unions that have gone the TIProute, there is no pattern that has emerged in either size or typeof credit union. For example, American Airlines Federal CreditUnion, a multi-billion dollar credit union, has used TIP to take inall airline employees. That would seem to give that CU enormouspotential as well as pit them competitively against all the otherairline credit unions. Yet, to date the new program has reportedlyonly brought in about a 1,000 new members. Then there is theconsiderably smaller $600 million asset Central Florida Health CareFCU. The name is perfect starting out. Maybe someday the best namewill involve dropping the Central and Florida? One credit union forthe nation's health care workers as mentioned above? Incidentally,this credit union seems to have the best handle on what TIP can andcannot do for them. It may just be a matter of time before TIPcharters emerge as the newest opportunity for credit unions tospread their wings even further and serve a far greater number ofAmericans engaged in some kind of trade, industry, or profession.Or it may sound good but never really take off. Apparently thebanking industry is no longer worried because they have stoppedwhining about TIP. Obviously there are many pros and cons regardingTIP charters. Apparently more cons than pros. Otherwise, how is thelack of enthusiasm for it by credit unions explained? Maybe readerscan help me understand TIP better? What do you think are the prosand cons of a TIP charter for your credit union? Comments? Call1-800-345-9936, Ext. 15, or Fax 561-683-8514, or [email protected].