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Washington
Free space branch names subjects of NCUA opinions
ALEXANDRIA, Va. (6/17/08)—The National Credit Union Administration (NCUA) has addressed the issues of credit union space in federal buildings and branch names in separate legal opinion letters released this month. In response to a query by NLRB FCU, Washington, D.C., the NCUA clarified a rule that allows federal agencies to grant free space for credit union use. A federal agency may allot building space to a credit union at no charge for rent or services if at least 95% of the membership of the credit union to be served by the allotment of space are, or were at the time of admission to membership, federal employees or their family members, according to the Federal Credit Union Act. NLRB asked if the 95% condition is properly applied to the credit union’s total membership or only the number of members who actually use the allotted space. The NCUA answered that the 95% is applied to the number of members who actually use the allotted space. In a second letter, this one directed to Mattel FCU, El Segundo, Calif., the NCUA said it is acceptable for a federal credit union to use the names of its sponsor's subsidiaries to name its branch offices. However, the NCUA noted, there are a few conditions that must be met. The credit union must take “reasonable steps to ensure members are fully apprised of the use of different names.” The agency referred to its Letter No. 99-CU-17 and noted a list of several steps a federal credit union must take to ensure its advertising in such cases is not inaccurate or deceptive, as prohibited by NCUA regulations. In particular, the NCUA said, credit unions should ensure signage used at a branch office under a different name clearly reflects the branch office is a division or branch of the same insured credit union. Also, the credit union should obtain written permission from its sponsor before using the names or trademarks of the sponsor's subsidiaries.
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