You don't have to designate the whole MSA, or even a whole county, but you must include all bank office locations, the tracts should be contiguious, and all tracts in a municipality must be included.
If you are in MSA 1660 Clarksville-Hopkins and up in Christian County, and Crofton is not an area you have a branch location, but Hopkinsville is you could not include tracts 2009.00, 2010.00, 2011.00 and 2012.00 in the northern part of the county.
You really need to know what your loan distribution is in order to make sure you have included enough tracts that include the majority of your loan originations.
If you are in Montgomery Cnty Tn and have an office in Clarksville, then IMO you might as well include the whole county as there are only a few tracts outside the Clarksville municipal boundary.
If you have no office or make few if any loans in that area then you should consider eliminateing it fro the AA
You can see why its a lot easier to include all track in the MSA for you, and the examiners like it, as it makes it easier from them to setup their analysis program
If you have specific questions you might e-mail me directly I'll help where I can.
Compliance Analysis and Research - Software for your CRA/HMDA analysis needs