Wednesday, November 21, 2012

ABA Comments on NCUA's Proposed Rural District

ABA in a November 19 comment letter urged the National Credit Union Administration Board to withdraw its proposal to amend the definition of “rural district.”

Under the proposed definition, a geographic area would qualify as a rural district if it has, among other criteria, a total population that does not exceed the greater of 200,000 people or 3 percent of the population of the state in which the majority of the district is located. Currently, a rural district cannot exceed 200,000 in population.

“ABA believes that the new population threshold … for a rural district is contrary to congressional intent,” the association said. “Congress explicitly stated that a meaningful affinity and bond, an interaction, and sense of cohesion or identity among a credit union’s membership were essential for a credit union to fulfill its public mission.”

But the NCUA’s proposed rural-district definition would permit the cobbling together of both rural and urban census blocks, and they would have little affinity or commonality of interest as intended under the law. “Moreover, the potential geographic area of a rural district under the amended definition could be so vast that it would make it nearly impossible for a federal credit union to fulfill its public mission,” ABA said.

Read the letter.


  1. As a compromise, how about expanding the rural-district definition to geographical areas banks abandoned. That should answer any concerns that credit unions somehow aren't fulfilling their public mission.

    1. Amen to that. Banks have been closing branches in rural area left and right...



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