Federal credit unions that use a narrative to apply for, expand or convert to a community charter should rely on as much third-party evidence as possible—not just anecdotes—to make their case to the NCUA, the agency said, in new guidance.

First and foremost, credit unions must demonstrate their ability to serve the requested community and their intent to serve the entire community, NCUA Board Chairman J. Mark McWatters wrote in a letter to credit unions that accompanied the guidance.

"The federal credit union can use a written narrative, with sufficient supporting documentation, to establish the existence of a well-defined local community," McWatters wrote in his letter.