ALEXANDRIA, Va.-The NCUA Board approved a five-county community charter for JAX Federal Credit Union-a rarity with the former two-member board-despite a recent legal challenge by the bankers to NCUA's large community charter approvals. JAX was approved to serve more than 1.2 million residents of Baker, Clay, Duval, Nassau, and St. Johns Counties, Fla. NCUA Insurance Analyst Rita Woods outlined how the field of membership is within clearly defined boundaries and already qualifies as a metropolitan statistical area. Orlando is the closest major city at more than 120 miles away. JAX already has nine branches in the proposed area and plans to add three more in 2006. A full 87% of the potential members will be within 15 miles of a branch. Also, by 2007, the credit union plans to nearly triple its marketing budget. NCUA Board Member Gigi Hyland asked Woods, "How is the credit union actually going to measure [the success of its marketing program]?" Woods said the credit union had purchased software to help track it. NCUA previously approved JAX to serve an underserved area within the community to get a head start there. About 25% of the population of the entire community is considered underserved. "You can't serve the underserved if they can't walk in the door," NCUA Chairman JoAnn Johnson emphasized. She added, "I was impressed with the services the credit unions offers and plans to offer." NCUA Board Member Rodney Hood agreed. He noted the number of low- and no-cost products the credit union is already offering, as well as the financial education programs "covering all aspects of the community." He also praised the credit union for partnering with the Federal Housing Authority and Veterans Affairs and wondered if JAX was working with his former employer, the U.S. Department of Agriculture, on a partnership. The NCUA Board members, through their questioning, were very thorough to outline the strict geographical boundaries of the large community charter approval as well as the current and planned service to the underserved. In light of the recent lawsuit by the American Bankers Association challenging NCUA's approval of a community charter for Members 1st Federal Credit Union and heavy questioning of the documentation of service to the underserved during a Ways and Means Committee hearing, it was crucial to get all this on the record, CUNA Associate General Counsel Mary Dunn said. "It's important not only that the credit union is concerned with targeting the population and reaching out, but that NCUA is concerned about that," she said. In its application, the credit union cited an aging FOM and competition from other area community charters as the reason for the move. When asked if this situation would continue to arise as more community charters are granted, NCUA Director of External Affairs Nicholas Owens replied, "NCUA does not regulate competition or consumer choice for financial services." Dunn was not concerned with field of membership overlap becoming a problem. Overlap is a "fact of life," she stated, adding that consumer choice is very important. "As credit unions work to meet the goals of the credit union movement more credit unions will attempt to expand their fields of membership and that's one option," NAFCU Associate Director of Regulatory Affairs Bill Hall commented. -

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