U.S. Code » Title 12 » Chapter CHAPTER 14— FEDERAL CREDIT UNIONS › Subchapter SUBCHAPTER I— GENERAL PROVISIONS

12 U.S.C. § 1759

Membership

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(a) In general

Subject to subsection (b), Federal credit union membership shall consist of the incorporators and such other persons and incorporated and unincorporated organizations, to the extent permitted by rules and regulations prescribed by the Board, as may be elected to membership and as such shall each, subscribe to at least one share of its stock and pay the initial installment thereon and a uniform entrance fee if required by the board of directors. Shares may be issued in joint tenancy with right of survivorship with any persons designated by the credit union member, but no joint tenant shall be permitted to vote, obtain loans, or hold office, unless he is within the field of membership and is a qualified member.

(b) Membership fieldSubject to the other provisions of this section, the membership of any Federal credit union shall be limited to the membership described in one of the following categories:(1) Single common-bond credit union

One group that has a common bond of occupation or association.

(2) Multiple common-bond credit unionMore than one group—(A) each of which has (within the group) a common bond of occupation or association; and(B) the number of members, each of which (at the time the group is first included within the field of membership of a credit union described in this paragraph) does not exceed any numerical limitation applicable under subsection (d).(3) Community credit union

Persons or organizations within a well-defined local community, neighborhood, or rural district.

(c) Exceptions(1) Grandfathered members and groups(A) In generalNotwithstanding subsection (b)—(i) any person or organization that is a member of any Federal credit union as of August 7, 1998, may remain a member of the credit union after August 7, 1998; and(ii) a member of any group whose members constituted a portion of the membership of any Federal credit union as of August 7, 1998, shall continue to be eligible to become a member of that credit union, by virtue of membership in that group, after August 7, 1998.(B) Successors

If the common bond of any group referred to in subparagraph (A) is defined by any particular organization or business entity, subparagraph (A) shall continue to apply with respect to any successor to the organization or entity.

(2) Exception for underserved areasNotwithstanding subsection (b), in the case of a Federal credit union, the field of membership category of which is described in subsection (b)(2), the Board may allow the membership of the credit union to include any person or organization within a local community, neighborhood, or rural district if—(A) the Board determines that the local community, neighborhood, or rural district—(i) is an “investment area”, as defined in section 4702(16) of this title, and meets such additional requirements as the Board may impose; and(ii) is underserved, based on data of the Board and the Federal banking agencies (as defined in section 1813 of this title), by other depository institutions (as defined in section 461(b)(1)(A) of this title); and(B) the credit union establishes and maintains an office or facility in the local community, neighborhood, or rural district at which credit union services are available.(d) Multiple common-bond credit union group requirements(1) Numerical limitation

Except as provided in paragraph (2), only a group with fewer than 3,000 members shall be eligible to be included in the field of membership category of a credit union described in subsection (b)(2).

(2) ExceptionsIn the case of any Federal credit union, the field of membership category of which is described in subsection (b)(2), the numerical limitation in paragraph (1) of this subsection shall not apply with respect to—(A) any group that the Board determines, in writing and in accordance with the guidelines and regulations issued under paragraph (3), could not feasibly or reasonably establish a new single common-bond credit union, the field of membership category of which is described in subsection (b)(1) because—(i) the group lacks sufficient volunteer and other resources to support the efficient and effective operation of a credit union;(ii) the group does not meet the criteria that the Board has determined to be important for the likelihood of success in establishing and managing a new credit union, including demographic characteristics such as geographical location of members, diversity of ages and income levels, and other factors that may affect the financial viability and stability of a credit union; or(iii) the group would be unlikely to operate a safe and sound credit union;(B) any group transferred from another credit union—(i) in connection with a merger or consolidation recommended by the Board or any appropriate State credit union supervisor based on safety and soundness concerns with respect to that other credit union; or(ii) by the Board in the Board’s capacity as conservator or liquidating agent with respect to that other credit union; or(C) any group transferred in connection with a voluntary merger, having received conditional approval by the Administration of the merger application prior to October 25, 1996, but not having consummated the merger prior to October 25, 1996, if the merger is consummated not later than 180 days after August 7, 1998.(3) Regulations and guidelines

The Board shall issue guidelines or regulations, after notice and opportunity for comment, setting forth the criteria that the Board will apply in determining under this subsection whether or not an additional group may be included within the field of membership category of an existing credit union described in subsection (b)(2).

(e) Additional membership eligibility provisions(1) Membership eligibility limited to immediate family or household members

No individual shall be eligible for membership in a credit union on the basis of the relationship of the individual to another person who is eligible for membership in the credit union, unless the individual is a member of the immediate family or household (as those terms are defined by the Board, by regulation) of the other person.

(2) Retention of membership

Except as provided in section 1764 of this title, once a person becomes a member of a credit union in accordance with this subchapter, that person or organization may remain a member of that credit union until the person or organization chooses to withdraw from the membership of the credit union.

(f) Criteria for approval of expansion of multiple common-bond credit unions(1) In generalThe Board shall—(A) encourage the formation of separately chartered credit unions instead of approving an application to include an additional group within the field of membership of an existing credit union whenever practicable and consistent with reasonable standards for the safe and sound operation of the credit union; and(B) if the formation of a separate credit union by the group is not practicable or consistent with the standards referred to in subparagraph (A), require the inclusion of the group in the field of membership of a credit union that is within reasonable proximity to the location of the group whenever practicable and consistent with reasonable standards for the safe and sound operation of the credit union.(2) Approval criteriaThe Board may not approve any application by a Federal credit union, the field of membership category of which is described in subsection (b)(2) to include any additional group within the field of membership of the credit union (or an application by a Federal credit union described in subsection (b)(1) to include an additional group and become a credit union described in subsection (b)(2)), unless the Board determines, in writing, that—(A) the credit union has not engaged in any unsafe or unsound practice (as defined in section 1786(b) of this title) that is material during the 1-year period preceding the date of filing of the application;(B) the credit union is adequately capitalized;(C) the credit union has the administrative capability to serve the proposed membership group and the financial resources to meet the need for additional staff and assets to serve the new membership group;(D) any potential harm that the expansion of the field of membership of the credit union may have on any other insured credit union and its members is clearly outweighed in the public interest by the probable beneficial effect of the expansion in meeting the convenience and needs of the members of the group proposed to be included in the field of membership; and(E) the credit union has met such additional requirements as the Board may prescribe, by regulation.(g) Regulations required for community credit unions(1) Definition of well-defined local community, neighborhood, or rural districtThe Board shall prescribe, by regulation, a definition for the term “well-defined local community, neighborhood, or rural district” for purposes of—(A) making any determination with regard to the field of membership of a credit union described in subsection (b)(3); and(B) establishing the criteria applicable with respect to any such determination.(2) Scope of application

The definition prescribed by the Board under paragraph (1) shall apply with respect to any application to form a new credit union, or to alter or expand the field of membership of an existing credit union, that is filed with the Board after August 7, 1998.

(June 26, 1934, ch. 750, title I, § 109, formerly § 9, 48 Stat. 1219; July 31, 1946, ch. 711, § 2, 60 Stat. 744; 1947 Reorg. Plan No. 1, § 401, eff. July 1, 1947, 12 F.R. 4534, 61 Stat. 952; June 29, 1948, ch. 711, §§ 1, 2, 62 Stat. 1091; renumbered § 10 and amended Pub. L. 86–354, § 1, Sept. 22, 1959, 73 Stat. 631; Pub. L. 91–206, § 2(1), Mar. 10, 1970, 84 Stat. 49; renumbered title I, § 109, Pub. L. 91–468, § 1(2), Oct. 19, 1970, 84 Stat. 994; amended Pub. L. 93–383, title VII, § 722, Aug. 22, 1974, 88 Stat. 719; Pub. L. 95–630, title V, § 502(b), Nov. 10, 1978, 92 Stat. 3681; Pub. L. 105–219, title I, §§ 101–103, Aug. 7, 1998, 112 Stat. 914–917; Pub. L. 109–351, title VII, § 726(9), Oct. 13, 2006, 120 Stat. 2002.)Editorial NotesAmendments

2006—Subsec. (c)(2)(A)(i). Pub. L. 109–351 made technical amendment to reference in original act which appears in text as reference to section 4702(16) of this title.

1998—Subsec. (a). Pub. L. 105–219, § 101(1)(A), designated existing provisions as subsec. (a) and inserted heading and “Subject to subsection (b),” before “Federal credit union membership shall consist of”.

Pub. L. 105–219, § 101(1)(B), which directed the amendment of subsec. (a) by striking out “, except that Federal credit union membership shall be limited to groups having a common bond of occupation or association, or to groups within a well-defined neighborhood, community, or rural district” after “directors”, was executed by striking out such language which began with a semicolon rather than a comma after “directors” to reflect the probable intent of Congress.

Subsecs. (b) to (e). Pub. L. 105–219, § 101(2), added subsecs. (b) to (e).

Subsec. (f). Pub. L. 105–219, § 102, added subsec. (f).

Subsec. (g). Pub. L. 105–219, § 103, added subsec. (g).

1978—Pub. L. 95–630 substituted “Board” for “Administrator”.

1974—Pub. L. 93–383 substituted “a uniform entrance fee if required by the board of directors” for “the entrance fee”.

1970—Pub. L. 91–206 substituted “Administrator” for “Director”.

1959—Pub. L. 86–354 substituted “persons” for “person” before “designated”.

1946—Act July 31, 1946, inserted sentence at end permitting a Federal credit union to issue shares in joint tenancy with a right of survivorship.

Statutory Notes and Related SubsidiariesEffective Date of 1978 Amendment

Amendment by Pub. L. 95–630 effective on expiration of 120 days after Nov. 10, 1978, and transitional provisions, see section 509 of Pub. L. 95–630, set out as a note under section 1752 of this title.

Report and Congressional Review Requirement for Certain Regulations

Pub. L. 105–219, title II, § 205, Aug. 7, 1998, 112 Stat. 923, provided that: “A regulation prescribed by the Board [National Credit Union Administration Board] shall be treated as a major rule for purposes of chapter 8 of title 5, United States Code, if the regulation defines, or amends the definition of—“(1) the term ‘immediate family or household’ for purposes of section 109(e)(1) of the Federal Credit Union Act [12 U.S.C. 1759(e)(1)] (as added by section 101 of this Act); or“(2) the term ‘well-defined local community, neighborhood, or rural district’ for purposes of section 109(g) of the Federal Credit Union Act (as added by section 103 of this Act).”

Notes of Decisions
Cited in 50 cases (2 in the last 5 years), 1973–2025 · leading case: Nat'l Credit Union Admin. v. First Nat'l Bank & Trust Co., 522 U.S. 479 (1998).
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Nat'l Credit Union Admin. v. First Nat'l Bank & Trust Co., 522 U.S. 479 (1998). · cites it 18× “1219 , 12 U. S. C. § 1759 , provides that "[f]ederal credit union membership shall be limited to groups having a common bond of occupation or association, or to groups within *483 a well-defined neighborhood, community, or rural district.”
Am. Bankers Ass'n v. Nat'l Credit Union Admin., 271 F.3d 262 (D.C. Cir. 2001). · cites it 20× “1216 , 1219 (1934) (codified at former 12 U.S.C. § 1759 (amended 1998)). Starting in 1982, the Administration began permitting multiple occupational groups, i.”
Am. Bankers Ass'n v. Nat'l Credit Union Admin., 38 F. Supp. 2d 114 (D.D.C. 1999). · cites it 16× “For years, the National Credit Union Administration (NCUA) interpreted Section 109 of the Federal Credit Union Act (FCUA), 12 U.S.C. § 1759 , to permit various employment groups, each one united by its own peculiar occupational bond but otherwise unrelated to another group, to…”
Griffin v. Dep't of Labor Fed. Credit Union, 912 F.3d 649 (4th Cir. 2019). · cites it 4× “12 U.S.C. § 1759 (b). Only members can take advantage of the Credit Union's products or services; only members may open an account or take out a loan or enjoy in any way the benefits of the Credit Union.”
Pennsylvania Bankers Ass'n v. Pennsylvania Dep't of Banking, 956 A.2d 956 (Pa. 2008). · cites it 10× “§ 501(e), that gives Pennsylvania credit unions the option of organizing membership by well-defined geographic communities, as permitted under the Federal Credit Union Code, 12 U.S.C. § 1759 , rather than by common bonds.”
Pennsylvania Bankers Ass'n v. Pennsylvania Dep't of Banking, 962 A.2d 609 (Pa. 2008). · cites it 8× “§ 501(e) (henceforth, "the federal parity provision"), which authorizes credit unions to amend their field of membership as provided under § 109 of the Federal Credit Union Act, 12 U.S.C. § 1759 . [4] Section 109, in turn, provides credit unions with the option of organizing…”
Pennsylvania Bankers Ass'n v. Pennsylvania Dep't of Banking, 981 A.2d 975 (Pa. Commw. Ct. 2009). · cites it 5× “1219 , 12 U.S.C. § 1759 ), subject to reasonable conditions, limitations and restrictions as may be imposed by the [Department, including, but not limited to, conditions, limitations and restrictions based upon safety and soundness.”
Am. Bankers Ass'n v. Nat'l Credit Union Admin., 934 F.3d 649 (D.C. Cir. 2019). · cites it 2× “" 12 U.S.C. § 1759 (b) (emphasis added). The 1998 version calls on the NCUA to "prescribe, by regulation, a definition for the term 'well-defined local community, neighborhood, or rural district.”
Pennsylvania Bankers Ass'n v. Pennsylvania Dep't of Banking, 948 A.2d 790 (Pa. 2008). · cites it 2× “§ 501(e) (extending to credit unions the power to engage in activities authorized by Section 109 of the Federal Credit Union Act, 12 U.S.C. § 1759 (b), including the option of basing membership on geographical districts).”
Navy Fed. Credit Union v. LTD Fin. Servs., LP, 972 F.3d 344 (4th Cir. 2020). “See 12 U.S.C. § 1759 (b)(1)−(2) (A federal credit union “shall be limited to .”
Griffin v. Dep't of Labor Fed. Credit Union, 293 F. Supp. 3d 576 (E.D. Va. 2018). · cites it 2× “" 12 U.S.C. § 1759 (b)(2). Importantly, DOL FCU's membership is open only to current of former employees of the Department of Labor or their immediate family or household members.”
Mova Pharm. Corp. v. Shalala, 140 F.3d 1060 (D.C. Cir. 1998). “” 12 U.S.C. § 1759 (1994). The question for the Court was whether a group of banks who had an interest in limiting the markets that credit unions could serve were within the zone of interests of this provision.”
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— 12 U.S.C. § 1759(b) — 1 case
Griffin v. Dep't of Labor Fed. Credit Union, 912 F.3d 649 (4th Cir. 2019). “12 U.S.C. § 1759 (b). Only members can take advantage of the Credit Union's products or services; only members may open an account or take out a loan or enjoy in any way the benefits of the Credit Union.”
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