Marie Bryant, Director/Consulting Services Georgia Credit Union Affiliates

For a federally chartered credit union:

• Obtain an NCUA Chartering Manual
• Two ways to obtain:
  a) www.ncua.gov
  b) Telephone NCUA at (703) 518-6300

For a state-chartered credit union:

• Obtain a Credit Union Applications Manual from the Georgia Department of Banking & Finance
• Two ways to obtain:
  a) http://www.ganet.org/dbf/pdfdoc/CUAppManual.pdf
  b) Telephone GDB&F at 770-986-1633

• Contact the Credit Union League Office in your state (handout).
• The league will assign an organizer to work with and for you.
• Their services are free because the leagues and their credit unions want more credit unions.
• They will put you in touch with the League's various Foundations, etc.
  

• There are three types of federal credit union charters.
• Single Common bond (occupational or associational) which consists of one group which has a common bond of occupation or association.
• Multiple Common Bond (multiple groups/occupational and/or associational) consists of more than one group, each of which has a common bond of occupation or association.
  

• The Community federal credit union consists of persons or organizations within a "well-defined" local community, neighborhood or rural district.
  

• The associational common bond describes the association or church's charter.
• You will need to provide the association or church's bylaws and association charter.
• You should make your field of membership as broad as possible.
• Include all associational sponsored entities (schools, nurseries, retirement homes, and other supported entities).
  

• If you are a religious organization or church, consider getting several churches to work together to provide the financial base needed for the establishment of a new credit union.
  

• The charter application must show that a substantial percentage of the group's members will join the credit union and use its services.
• Prepare a survey for your potential members. Get a sample survey from your league.
• Keep and enclose only one copy of the survey in your application.
• Record the number of surveys that you send out.
  

• Prepare a summary of the survey results. Do not send surveys to NCUA. Keep for your records and for regulatory review.
• Your financial data in your business plan will be based on this survey.
  

• Select a minimum of seven people to serve as subscribers. They will sign the application.
• Select a lead person to chair the group who will assign duties and get the tasks completed to submit the application.
• The subscribers must be people of good character. They will elect and select the board of directors.
  

• The board of directors and committee members must be people with good character.
• Public Records Reports and Credit Reports will be obtained on each volunteer.
• The investigation reports must demonstrate their ability to effectively handle financial matters.
  

• NCUA need assurance that the management team will have the skills and commitment to dedicate the time and effort needed to make the proposed credit union a success.
• Let the volunteers know up-front that they can be rejected by NCUA because of these public record and credit reports.
  

• The most successful boards are composed of seven to nine members.
• The Supervisory Committee (Audit Committee) is made up of three members.
• The Credit Committee usually has five members.
  

• The board will usually select by-laws that allow them to appoint these committees.
  

• The ability to compete in the marketplace and to adapt to changing market conditions is key to the survival of any enterprise, and a crucial part of that is the ability to plan well.
• NCUA requires a business plan based on realistic and supportable projections and assumptions. Please click here for more information.
  

• There are 18 elements of the required business plan as outlined in the Chartering Manual.
• The business plan will enable the credit union to begin operations within 60 days after approval.
  

• The plan includes operating policies, staffing and credentials of employees, physical facilities and record-keeping system.
• It also details goals for members, operations, and deposits.
  

• The sponsor's commitment is critical to the success of the credit union.
• Evidence of commitment may be in the form of letters, contracts, or any other such document on which the credit union can substantiate its projections.
  

• Some credit unions have failed because the sponsor did not "keep their word" about their commitment and carry through with the support they promised.
  

• The sponsor's commitment for at least two years of funds, location, furniture and equipment, as well as staff and employees is critical to the success of the credit union.
• Other sources of funds can be sought.
• Apply for League Foundation Grants to obtain training, marketing assistance and audits.
  

• Depends on the level of commitment and financial expertise of the group.
• Estimate between six and twelve months to finalize charter application.
• NCUA will assign an examiner to meet with the group after they receive an application.
  

• NCUA will take approximately three or more months before approval.
  

• The management team wants to be a "bank" immediately.
• Capital is built "dollar by dollar" and takes time and commitment.
• Credit unions might have a problem because their members expect "charity" instead of the survival business tactics and solutions of a successful financial institution.
  

• Collecting the loans made to members is difficult.
• "Politics"surrounding the sponsor can affect the credit union's management.
  

• The volunteer board of directors must work for the good of the members and the credit union. Sponsor related issues should be left outside the board of directors' meeting room.
  

• Collect all of the documentation, forms, etc., needed for the application and put them in a notebook. Make sure there are no loose pages, inserts, etc. Use letter size pages only.
  

• Print or type all documentation. Use a 14-point type and use double spacing whenever possible in text documents. Make sure that there are adequate margins on each page.
  

• Use the forms provided by NCUA and make sure that each signature is the same and that each signature is a complete name.
• Do not retype the bylaws. Simply fill in the blanks provided.
• Maintain a complete copy for your records.
  

• SEND APPLICATION TO YOUR REGIONAL NCUA OFFICE.