Post on 19-Mar-2020
CUNA’s State Governmental Affairs
COMPARATIVE DIGEST OF CREDIT UNION ACTS:
CHANGE IN CORPORATE STATUS
2018
Comparative Digest of Credit Union Acts*: Change in Corporate Status CUNA’s State Government Affairs – 2018
TABLE OF CONTENTS
CHAPTER 1: VOLUNTARY LIQUIDATION 1
CHAPTER 2:
VOLUNTARY MERGER OF CREDIT UNIONS
8
CHAPTER 3:
CREDIT UNION CHARTER CONVERSION
21
CHAPTER 4:
BANK TO CREDIT UNION CONVERSION
30
CHAPTER 5:
DISSENTERS’ RIGHTS IN CREDIT UNION TO BANK CONVERSION
51
1
Comparative Digest of Credit Union Acts*: Change in Corporate Status
Provisions from State Credit Union Acts
Voluntary Liquidation
*There are 47 state credit union acts. Delaware, South Dakota, and Wyoming do not have a state credit union act.
2015 Model Credit Union Act
Section 9.10. Voluntary Liquidation.41
(1) A credit union may elect to dissolve voluntarily and liquidate its affairs by a two-thirds vote of the board
of directors and in the manner described in this section.
(2) Within ten days after the board of directors votes to liquidate, the board shall notify the Commissioner in
writing, setting forth the reasons for the proposed liquidation, and a plan for liquidation. Depending on
the credit union’s circumstances, a liquidation plan may, or may not, require the suspension of: payments
on accounts, withdrawal of funds, transfer to loan accounts, investments, new loans or other similar
financial transactions.
(3) The Commissioner will determine whether this section has been complied with and, if the Commissioner’s
decision is favorable, he or she shall prepare a certificate to the effect that this section has been
complied with, a copy of which will be retained by the commission and the other copy forwarded to the
credit union.
(4) The terms and conditions of the liquidation plan approved under this section shall go into effect
immediately upon approval.
(5) Voluntary liquidation requires approval by a vote of two-thirds of the members present, either in person,
by mail ballot, or by electronic means at a regular meeting which specifically included the liquidation
issue on the notice, or by a special meeting called specifically to vote on the liquidation issue with a
minimum of 25 percent of the total membership voting. When authorization for liquidation is to be
obtained at a meeting of the members, notice in writing shall be given to each member, by first class
mail, at least ten days, but no more than thirty days, prior to such meeting.
(6) If liquidation is approved, the board of directors shall appoint a liquidating agent or committee for the
purpose of conserving and collecting the assets, closing the affairs of the credit union and distributing the
assets as required by this Act.
(7) A liquidating credit union shall continue in existence for the purpose of discharging its debts, collecting
on loans and distributing its assets, and doing all acts required in order to terminate operations and may
sue and be sued for the purpose of enforcing such debts and obligations until its affairs are fully
concluded.
(8) The liquidating agent or committee shall distribute the assets of the credit union or the proceeds of any
disposition of the assets in the sequence described in section 10.35(2).
(9) As soon as the liquidating agent determines that all assets from which there is a reasonable expectancy
of recovery have been liquidated and distributed as set forth in this section, the liquidating agent shall
execute a certificate of dissolution on a form prescribed by the Commissioner and file the same,
together with all pertinent books and records of the liquidating credit union, with the Commissioner,
whereupon such credit union shall be dissolved. The liquidating agent or committee must, within three
years after issuance of a certificate by the director referred to in subsection (3) of this section, discharge
the debts of the credit union, collect and distribute its assets and do all other acts required to wind up its
business.
(10) If the Commissioner determines that the liquidating agent or committee has failed to make reasonable
progress in the liquidating of the credit union’s affairs and distribution of its assets or has violated this Act,
the Commissioner may issue a cease and desist order against the liquidating agent or committee and
appoint a new liquidating agent to complete the liquidation under the Commissioner’s direction and
control. The Commissioner shall fill any vacancy caused by the resignation, death, illness, removal,
desertion or incapacity to function as the liquidating agent.
(11) Any funds representing unclaimed dividends and shares in liquidation and remaining in the hands of the
board of directors or the liquidating agent or committee at the end of the liquidation must be deposited
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by them, together with all books and papers of the credit union, with the Commissioner. Such funds must
be deposited by the Commissioner with the State Treasurer.42
41 This provision gives the board of directors the power to initiate the process of voluntary liquidation by a two-thirds vote of
the board and to specify the process by which the members would approve a voluntary liquidation.
42 Refer to the relevant state law on disposition of unclaimed property or the Uniform Disposition of Unclaimed Property Act.
3
Comparative Digest of Credit Union Acts*: Change in Corporate Status
Provisions from State Credit Union Acts
Voluntary Liquidation
*There are 47 state credit union acts. Delaware, South Dakota, and Wyoming do not have a state credit union act.
Alabama
§ 5-17-21. Voluntary dissolution.
The process of voluntary dissolution shall be as follows: At a meeting called for that purpose (notice of which purpose
must be contained in the call) two thirds of those in attendance may vote to dissolve the credit union. Notice of the
meeting must have been mailed to the last known address of each member of the credit union at least 15 days prior to
the date of the meeting. The Administrator of the Alabama Credit Union Administration determines whether or not the
credit union is solvent. If such is the fact, he issues in duplicate a certificate to the effect that this section has been
complied with. The certificate is filed with the probate judge of the county in which the credit union is located,
whereupon the credit union is dissolved and shall cease to carry on business except for the purposes of liquidation. The
credit union shall continue in existence for the purpose of discharging its debts, collecting and distributing its assets and
doing all other acts required in order to wind up its business, and may sue and be sued for the purpose of enforcing such
debts and obligations until its affairs are fully adjusted and wound up for three years.
Alaska Silent
Arizona § 6-584. Voluntary dissolution.
A. A credit union may elect to dissolve voluntarily and terminate its affairs in the following manner:
1. The board of directors shall adopt a resolution recommending that the credit union be dissolved voluntarily, naming
a liquidating agent adequately bondable, and directing that the question of a dissolution be submitted to a regular
or special meeting of the members.
2. At a regular or special meeting called for such purpose where the notice of such purpose is contained in the call, the
affirmative vote of a majority of the members of the credit union present shall be required to dissolve the credit union.
3. Upon the adoption of a resolution to dissolve, a statement of intent to dissolve shall be executed in triplicate by the
president or vice-president, and attested by its secretary, which shall set forth:
(a) The name of the corporation.
(b) Names and addresses of the officers and directors of the corporation.
(c) A copy of the resolution authorizing the voluntary dissolution and the name and address of the liquidating agent.
(d) Names and addresses of the members and the amount of the shares and loan balances of members outstanding.
(e) A financial and statistical report as of the date the resolution to dissolve is adopted.
B. Immediately upon the adoption of the resolution to dissolve, the credit union shall furnish to the superintendent
duplicate copies of the statement of intent to dissolve and the superintendent shall then determine whether or not the
credit union is solvent. If it is solvent, he shall issue to the credit union in quadruplicate a certificate to the effect that this
section has been complied with. The certificate shall be filed by the credit union with the corporation commission and
a duplicate copy recorded in the office of the county recorder of the county in which the credit union is located,
whereupon the credit union shall be deemed dissolved and shall cease carrying on business except for the purpose of
liquidation.
C. The credit union shall continue in existence for the purpose of discharging its debts, collecting and distributing its assets
and doing all other acts required to completely dissolve the credit union, and may sue and be sued for the purpose of
enforcing such debts and obligations until its affairs are fully terminated, but an action may not be filed by or against
such credit union more than two years after this certificate of dissolution is recorded.
D. The credit union shall during the dissolution period furnish to the superintendent regular monthly progress reports of the
affairs of the credit union until the final dissolution of the credit union.
E. After the expiration of two years from the date of final dissolution the superintendent may destroy all books and records
of such credit union in his possession.
Arkansas § 23-35-703. Voluntary dissolution.
A credit union may elect to dissolve voluntarily and wind up its affairs in the following manner:
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(1) The board shall adopt a resolution recommending that the credit union be dissolved voluntarily and directing that the
question of dissolution be submitted to a regular or special meeting of the members;
(2) After the adoption of the resolution to voluntarily dissolve, no receipts shall be accepted nor withdrawals permitted
from its share or deposit accounts, nor shall any loans be made nor any dividends declared nor paid pending final
determination by its membership on the voluntary dissolution;
(3) At a meeting called to consider the matter, a majority of the entire membership may vote to dissolve the credit union,
provided a notice of the meeting was mailed to the members of the credit union at least ten (10) days prior thereto.
Any member not present at the meeting may, within the next twenty (20) days, vote in favor of dissolution by signing a
statement in a form approved by the State Credit Union Supervisor, and the vote shall have the same force and effect
as if cast at the meeting;
(4) The credit union shall thereupon immediately cease to do business, except for the purpose of liquidation; and
(5) The president and the secretary of the credit union shall, within five (5) days following the meeting, notify the State Credit
Union Supervisor of intention to liquidate and shall include a list of the names and addresses of the directors and officers
of the credit union.
§ 23-35-705. Procedure for liquidation or dissolution.
(a) The credit union shall continue in existence for the purposes of discharging its debts, collecting and distributing its
assets, and doing all acts required in order to wind up its business, and it may sue and be sued for the purpose of
enforcing its debts and obligations until its affairs are fully adjusted.
(b) The board of directors, or in the case of involuntary dissolution the liquidating agent, shall, after applying each
member's share or deposit account against any loan or debt owed the credit union by that member, use the assets of
the credit union to pay:
(1) Expenses incidental to liquidation, including any surety bond that may be required;
(2) Any liability due nonmembers; and
(3) Savings club accounts as provided in this chapter.
(c) Assets then remaining shall be distributed to the members proportionately to the shares held by each member as of the
date dissolution was voted or ordered.
(d) As soon as the board or liquidating agent determines that all assets from which there is a reasonable expectancy of
realization have been liquidated and distributed as set forth in this section, they shall execute a certificate of
dissolution on a form prescribed by the State Credit Union Supervisor and file the certificate with him.
(e) The credit union shall be subject to examination by the State Credit Union Supervisor in accordance with its schedules.
California § 15250.
(a) Whenever the board of directors of a credit union recommends by a vote of a majority of all its members the
dissolution of the credit union, the members of the credit union, at any meeting specially called to consider the
subject, may elect to dissolve the credit union, by the vote or written consent of a majority of all members of the
credit union.
(b) The commissioner may approve the dissolution of a credit union which is recommended by the vote of a majority of
the board members of the credit union, even if the dissolution is approved by less than a majority of all members of
the credit union, if the commissioner finds, upon the written and verified application filed by the board of directors,
that (1) notice of the meeting called to consider the dissolution or the written ballot for written vote on the dissolution
was mailed to each member entitled to vote upon the question, (2) the notice or the written ballot disclosed the
purpose of the meeting or the written vote and informed the membership that approval of the dissolution might be
sought pursuant to this section, and (3) a majority of the votes cast upon the question were in favor of the dissolution.
(c) Whenever the members of the board of directors vote to recommend the dissolution of any credit union, the credit
union shall not make any loans, withdrawal of shares, or withdrawal of certificates for funds until the members
approve or disapprove the recommendation of the board of directors.
§ 15251.
If the dissolution of the credit union is approved pursuant to subdivision (a) or (b) of Section 15250, the board of directors
of the credit union shall elect a committee of three members or may by resolution appoint a liquidating agent to liquidate
the assets of the credit union. If the commissioner is appointed liquidating agent, the commissioner may act as liquidating
agent or appoint the National Credit Union Administration or other person to act as liquidating agent. Whenever the
commissioner is appointed liquidating agent, the credit union shall surrender its certificate to act as a credit union.
§ 15252.
Promptly thereafter the president or vice president and secretary or assistant secretary, or a majority of the committee or
the liquidating agent in charge of liquidation, shall sign and verify a certificate stating that the credit union has elected to
wind up and dissolve and showing by what vote or consent such election was made. The certificate shall be filed in the
office of the Secretary of State, and copies of the certificate certified by the Secretary of State shall be filed with the
commissioner.
§ 15253.
After a vote to dissolve a credit union no business may be carried on by the credit union except in the proper course of
liquidation.
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§ 15254.
The committee or the liquidating agent in charge of liquidation may sue in the name and on behalf of the credit union,
and may sell or otherwise dispose of the assets of the credit union, in whole or in part, at public or private sale.
§ 15255.
After determining that all known debts and liabilities of the credit union have been paid or adequately provided for, the
committee or the liquidating agent in charge of liquidation shall distribute all the remaining assets of the credit union
among the members or shareholders. Each share is entitled to its proportionate amount of the assets according to the
amount paid on that share.
§ 15257.
When a credit union has completely wound up, all of its known debts and liabilities actually paid or adequately provided
for or paid as far as its assets permit, and its known assets distributed, a majority of the committee or the liquidating agent
in charge of liquidation shall sign and acknowledge a certificate stating that the credit union has been completely
wound up, its known assets distributed, any tax or penalty due under the Bank and Corporation Franchise Tax Law paid,
and its other known debts and liabilities actually paid or adequately provided for or paid as far as its assets permit and
that the credit union is dissolved.
§ 15258.
The certificate of dissolution shall be filed in the office of the Secretary of State and copies, certified by him, shall be filed
in the office of the commissioner.
§ 15259.
At any time during the liquidation process, the committee or the liquidating agent in charge of liquidation may be
relieved of their duties at the discretion of the commissioner and the commissioner shall thereafter act as the liquidating
agent or appoint a liquidating agent to complete the dissolution of the credit union.
§ 15260.
Where the commissioner finds that on the date of filing with the Secretary of State of the certificate of election to wind up
and dissolve, the credit union does not have sufficient assets to return to its shareholders their investment in full, the credit
union shall not be liable for the costs of administration assessed under Article 4 (commencing with Section 14350) of
Chapter 3.
Colorado § 11-30-120. Suspension – liquidation – procedures.
(2) Any credit union may be voluntarily dissolved and liquidated upon majority vote of the entire membership thereof at a
meeting especially called for the purpose or at the annual meeting where notice of such proposed action is mailed
to the members at least thirty days prior to such meeting. In either event, a copy of the notice shall be delivered to
the commissioner not less than ten days prior to such meeting. Any member of a credit union may cast his ballot for or
against such dissolution and liquidation by mail within twenty days after such meeting. If a majority of the members of
the credit union vote in favor of dissolution and liquidation, the board of directors, within five days after the close of
voting, shall notify the commissioner of such action and specify the names and addresses of the directors and officers
of the credit union who will conduct the dissolution and liquidation of the credit union. Upon such favorable, vote, the
credit union shall cease to do business except or the collection of payments on outstanding loans or other obligations
due the credit union.
(3) Under any procedure to dissolve and liquidate a credit union pursuant to subsection (1) or (2) of this section, the credit
union shall continue in existence for the purpose of discharging its debts, collecting and distributing its assets, and
doing all acts required in order to wind up its business, and it may sue and be sued for the enforcement of its debts
and operations until its affairs are fully adjusted in liquidation. The assets of the credit union shall be used to pay: First,
the expenses incidental to liquidation; second, liabilities due nonmembers; and third, deposits and savings club
accounts. Any remaining assets shall be distributed to the members proportionately to the shares held by each
member as of the date of dissolution.
(4) Upon the liquidation and distribution of all assets of the credit union which may be reasonably expected to be
collectible, the board of directors or the liquidating agent, as the case may be, shall execute in duplicate a
certificate of dissolution, prescribed by the commissioner, upon which date the credit union shall cease to exist, and
file the same with the secretary of state.
Connecticut Sec. 36a-470a. Termination.
(a) A Connecticut credit union may terminate its corporate existence and be dissolved in accordance with a plan of
dissolution as provided in this section.
(b) Within three days after a majority of the governing board has adopted a plan of dissolution of the Connecticut credit
union, the governing board shall file with the commissioner a copy of such plan of dissolution, attested by the
chairman or vice chairman and the secretary or treasurer, and inform the commissioner of the date on which the plan
will be voted on by the members of the Connecticut credit union. The plan of dissolution shall be approved at an
annual or special meeting of the members. Written notice of the date, time and place of the meeting at which the
plan of dissolution is to be considered shall be hand-delivered or mailed to each member at such member’s last-
known address as shown on the records of the Connecticut credit union, not more than thirty or less than seven days
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prior to the date of the vote. The written notice shall clearly describe the plan and the reasons for the plan and shall
notify the member of such member’s right to vote on the plan in person, by proxy or by mail ballot, and shall have an
official form of proxy or mail ballot attached. The affirmative vote of two-thirds of those members voting shall be
required to approve the proposal. Upon receipt of the filing, the commissioner may by order appoint the National
Credit Union Administration or its successor agency to act as liquidating agent.
(c) Within three days after the members of such Connecticut credit union have voted on the plan of dissolution, the
Connecticut credit union shall file with the commissioner a statement of the results of the vote, certified by the
secretary of the credit union. The statement shall state the number of members who voted on the plan and the
number of members who voted in favor of adopting such plan.
(d) On receipt of the statement, the commissioner shall:
(1) Take possession of the property and business of the Connecticut credit union; or
(2) Notify the liquidating agent, if one is appointed as provided in subsection (b) of this section, to take possession
of the property and business of the Connecticut credit union; or
(3) Apply to the superior court for the judicial district of Hartford for the appointment of a receiver for the
Connecticut credit union. The court may appoint the receiver after reasonable notice to the Connecticut
credit union.
The commissioner may seek the appointment of a conservator or receiver for any Connecticut credit union, in
accordance with section 36a-220, if the commissioner certifies, in writing, that no other reasonable alternatives are
available to protect the members and creditors of such Connecticut credit union, and it appears that:
(1) The Connecticut credit union, through insolvency, repeated gross mismanagement or repeated neglect in the
conduct of its operations, is no longer able to carry out the purposes for which it was formed;
(2) The Connecticut credit union has abandoned its activities and is no longer functioning as a Connecticut credit
union and termination cannot be accomplished by any other means; or
(3) Any reason specified in subsection (a) of section 36a-220 exists.
Florida § 657.064 Voluntary liquidation.
A credit union may elect to dissolve voluntarily and liquidate its affairs in the following manner:
(1) Before considering any resolution pertaining to voluntary liquidation by the board of directors, the credit union must
inform the office and the National Credit Union Administration of the time and place of the meeting of the board of
directors. The notification must be transmitted at least 10 days before the board of directors meets.
(2) The board of directors, pursuant to this section, shall, by resolution, recommend to the membership that the credit
union be dissolved and shall state the board’s reasons for such recommendation.
(3) Within 10 days after adoption by the board of directors of the resolution proposing voluntary liquidation, a copy of
the resolution shall be mailed to each member, giving notice of the time, location, and purpose of a special
membership meeting, which must be held not less than 10 nor more than 20 days following the mailing of the
resolution. Included in this notice shall be a mail ballot, allowing each member to vote in favor of or against the
proposed voluntary liquidation. All ballots which are received by the credit union prior to the time set for the special
membership meeting shall be counted together with the ballots cast at the meeting to determine whether the
membership approves of the voluntary liquidation. Adequate procedures shall be established to provide that each
member shall have but one vote. A majority of the votes cast by the members must be in favor of voluntary
liquidation for the credit union to be voluntarily liquidated. Those casting ballots by mail or at the meeting constitute
a quorum for the transaction of business at such special meeting, notwithstanding any contrary bylaw provision.
(4) Upon adoption by the board of directors of a resolution recommending that the credit union be voluntarily
liquidated, the office or the National Credit Union Administration may restrict control or give directions with respect to
the continued business of the credit union pending consideration of the voluntary liquidation by the members. During
such period, no member shall withdraw an aggregate amount in excess of the insurance or guaranty covered by the
credit union. No new extensions of credit
shall be funded during the period between the board of directors’ adoption of the resolution recommending the
voluntary liquidation and the membership meeting called to consider the voluntary liquidation, except for loans fully
secured by a pledge of shares and for the funding of outstanding loan commitments approved before the board of
directors adopts the resolution.
(5) The notice required by subsection (3) shall also be mailed to the office and the National Credit Union Administration
within 5 days after the action of the board of directors. Within 10 days after the meeting of the membership, the
board of directors shall notify the office and the National Credit Union Administration in writing of the action taken by
the members.
(6) If the voluntary liquidation is approved by the membership, the board of directors shall appoint a liquidator to
proceed with the liquidation. All reasonable and necessary expenses of operation during the period of liquidation
shall continue to be paid as authorizable by the board of directors. When all assets from which there is a reasonable
expectancy of realization have been fully paid, the remaining liquidation proceeds shall be paid and distributed to
the members, ratably according to the balances in the share accounts as of the close of the last business day
preceding the date of the resolution of the board of directors pursuant to subsection (2).
(7) The National Credit Union Administration shall have the right of first refusal to be appointed as liquidator of any
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liquidating credit union which it insures. The liquidator shall have all of the powers provided in s. 657.063 regarding
involuntary liquidation. If the National Credit Union Administration declines to serve as liquidator, the board of
directors shall appoint a reasonable person as liquidator and specify the extent of responsibilities and authority
delegated to the liquidator.
(8) When the liquidating agent of the credit union has been appointed, the office may waive or hold inapplicable the
fees required by this chapter and the examination required by s. 655.045(1) if the liquidating agent submits periodic
reports to the office on the status of the liquidation.
(9) Whenever the board of directors or liquidator determines that all assets from which there is a reasonable expectancy
of realization have been liquidated and distributed to the members, a certificate of dissolution on forms prescribed
by the commission shall be prepared and filed with the office together with all pertinent books and records of the
credit union, and thereupon the credit union shall be dissolved and its certificate of authorization canceled. The
office may designate a custodian to maintain the books and records of the liquidated credit union.
Georgia
§ 7-1-114. Voluntary dissolution after commencement of business.
(a) A financial institution which has commenced business may elect to dissolve voluntarily upon:
(1) Adoption by the vote required of its shareholders under subsection (b) of this Codes section of:
(A) A plan of dissolution involving both a provision for assumption of its liabilities by another financial institution and
a provision for continuance of its business if such assumption of its liabilities is not effected; or
(B) Any other plan of dissolution providing for full payment of its liabilities; and
(2) Approval by the department of the plan of dissolution after application for approval thereof in a manner
prescribed by the department.
(b) Adoption of the plan by the shareholders of the financial institution shall require the affirmative vote of the
shareholders entitled to case at least two-thirds of the votes which all shareholders are entitled to cast on the plan
and, if any class of shareholders is entitled to vote on the plan as a class, of the holders of at least two-thirds of the
outstanding shares of such class, provided, in the case of a credit union, adoption of the plan may be made by the
affirmative vote of at least two-thirds of the members present and entitled to vote at a meeting duly called for that
purpose.
(c) Upon receipt of an application for approval of a plan of dissolution, the department shall conduct such investigation
as it may deem necessary to determine whether:
(1) The plan satisfies the requirements of this chapter;
(2) The plan adequately protects the interests of depositors, other creditors, and shareholders; and
(3) The plan involves an assumption of liabilities by another financial institution, such assumption would be consistent
with adequate and sound banking and in the public interest on the basis of factors substantially similar to those set
forth in Code Section 7-1-534.
(d) Within 90 days after receipt of the application, the department shall approve or disapprove the application on the
basis of its investigation and shall immediately give to the financial institution written notice of its decision and, in the
event of disapproval, a general statement of the reasons for its decision. The decision of the department shall be
conclusive, except as it may be subject to judicial review under Code Section 7-1-90.
§ 7-1-115. Winding up voluntary dissolution proceedings.
(a) The board of directors shall have full power to wind up and settle the affairs of a financial institution in voluntary
dissolution proceedings.
(b) Within 30 days after the department’s approval of voluntary liquidation and dissolution, the financial institution shall
give notice of its dissolution:
(1) By mail to each depositor and creditor (except those as to whom the liability of the financial institution has been
assumed by another financial institution pursuant to the plan), including a statement of the amount shown by the
books of the financial institution to be due to such depositor or creditor and a demand that any claim for a
greater amount be filed with the financial institution before a specified date at least 60 days after the date of
notice;
(2) By mail to each lessee of a safe-deposit box and each customer for whom property is held in safe deposit (except
those as to whom the liability of the financial institution has been assumed by another financial institution pursuant
to the plan), including a demand that all property held in a safe-deposit box or held in safe-deposit by the
financial institution be withdrawn by the person entitled thereto before a specified date at least 60 days after the
date of the notice;
(3) By mail to each person interested in funds held in a fiduciary account or other representative capacity;
(4) By a conspicuous posting at each office of the financial institution; and
(5) By such publication as the department may prescribe.
(c) As soon as feasible after the department’s approval of voluntary liquidation and dissolution, the financial institution
shall resign all of its fiduciary appointments and take such action as may be necessary to settle its fiduciary accounts.
(d) Except where liabilities are to be assumed by another financial institution:
(1) All claims of depositors and creditors shall be paid promptly after the date specified in the notice given under
paragraph (1) of subsection (b) of this Code section, and unearned portions of rentals for safe-deposit boxes shall
be rebated to the lessee thereof;
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(2) Safe-deposit boxes whose contents have not been removed after the date specified in the notice given under
paragraph (2) of subsection (b) of this Code section shall be opened under the supervision of the department and
the contents placed in sealed packages which, together with unclaimed property held by the financial institution
in safe deposit, shall be transmitted to the department to be held by it subject to Article 5 of Chapter 12 of Title 44,
provided that the department while holding such property may take such actions as it deems appropriate to
protect the interests of the owner including reducing such property to cash;
(3) After payment of amounts due to all known depositors and creditors, unclaimed amounts due to depositors and
creditors shall be paid through the department and held by it subject to Article 5 of Chapter 12 of Title 44; and
(4) Assets remaining after the performance of all obligations of the financial institution under this subsection and
subsection (c) of this Code section shall be distributed to its shareholders according to their respective rights and
preferences. Partial distributions to shareholders may be made prior to such time only if and to the extent
approved by the department.
(e) During the course of dissolution proceedings, the financial institution shall make such reports as the department may
require and shall continue to be subject to the provisions of this chapter concerning examinations and investigations
of financial institutions. Furthermore, during the course of a voluntary dissolution, the financial institution with the written
permission of the department may elect to use provisions of Article 14 of Chapter 2 of Title 14 that are not in conflict
with this chapter.
(f) If, at any time during the course of dissolution proceedings, the department finds that the assets of the financial
institution will not be sufficient to discharge its obligations, the department may then or at any time thereafter take
possession of the business and property of the financial institution and complete the dissolution in accordance with
this chapter.
§ 7-1-116. Articles of dissolution where business commenced; procedure if not filed.
(a) When all the liabilities of the financial institution have been discharged and all of its remaining assets have been
distributed to its shareholders pursuant to Code Section 7-1-115 or its liabilities have been assumed by another
financial institution, the articles of dissolution shall be signed by two duly authorized officers of the financial institution
under its seal and shall contain:
(1) The name of the financial institution and the post office address of its principal place of business;
(2) A statement that the department has previously approved a plan to dissolve the institution and the date on which
such approval was transmitted to the Secretary of State;
(3) A statement that all liabilities of the financial institution have been discharged and that the remaining assets of the
financial institution have been distributed to its shareholders or that its liabilities have been assumed as provided in
this chapter; and
(4) A statement that there are no actions pending against the financial institution
(b) The articles of dissolution shall be delivered to the department together with the filing fee required by Code Section 7-
1-862. If the department finds that the articles satisfy the requirements of this chapter, it shall deliver its written
approval to the Secretary of State with a copy of the articles of dissolution attached.
(c) Where a financial institution fails to file articles of dissolution within 180 days after the department determines that
dissolution proceedings have been completed as provided in this part, the department may cause notice to be
published in accordance with this chapter to the effect that persons having claims against the financial institution
should notify the department within 30 days of the date of initial publication. If the department receives no such
notifications or if claims are otherwise satisfied, the department shall notify the Secretary of State that the articles of
incorporation or charter are no longer valid and should be promptly canceled of record in the offices of the Secretary
of State.
§ 7-1-117. Certificate of dissolution.
If all applicable fees, charges, and taxes required by law have been paid upon the receipt of the department’s
approval, under Code Section 7-1-113 or 7-1-116, of the articles of dissolution, the Secretary of State shall immediately
issue to the financial institution a certificate of dissolution with the approved articles of dissolution attached thereto and
shall retain a copy of such certificate, the approval of the department and the articles; and the existence of the financial
institution shall cease.
Hawaii §412:3-617 Voluntary cessation of business; dissolution.
(a) Except for a credit union, a solvent Hawaii financial institution whose capital is not impaired and which has not
received a notice of charges and proposed suspension or revocation order pursuant to section 412:2-312 may cease
its business and dissolve if the institution shall have complied with applicable federal law and the following
requirements and conditions:
(1) The board of directors shall adopt a resolution adopting a plan of liquidation and dissolution and recommending
that the financial institution be dissolved, and directing that the question of the dissolution be submitted to the
commissioner for approval, and, if approved, to a vote of the shareholders or members, which vote may be at
either an annual or special meeting. The plan of liquidation and dissolution shall include, but not be limited to,
provisions for the orderly payment or assumption of the institution's deposits and other liabilities and for transfer or
assumption of all trust, agency, and other fiduciary relationships and accounts;
(2) Within five business days after the meeting of the board of directors described in paragraph (1), the financial
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institution shall file an application with the commissioner pursuant to section 412:3-603 for approval to cease
business and dissolve. The application shall be accompanied by a copy of the plan of liquidation and dissolution
certified by two executive officers of the financial institution to have been duly adopted by the board and any
other information that the commissioner may require. A copy of the notice shall be delivered contemporaneously
to the financial institution's federal insurer;
(3) The commissioner shall approve the application to cease business and dissolve if the commissioner is satisfied that
the depositors, beneficiaries, and creditors will be adequately protected under the plan, the institution is not
insolvent or in danger of becoming insolvent, that its capital is not impaired and is not in danger of becoming
impaired, and that no other reason exists to deny the application. The commissioner may impose any restrictions
and conditions as the commissioner deems appropriate;
(4) Upon receipt of the commissioner's approval to cease business and dissolve, the financial institution shall proceed
with the dissolution in accordance with the procedures, conditions, and requirements for, and with the effect of, a
voluntary dissolution by act of corporation pursuant to chapter 414, except that the vote by shareholders or
members to approve the dissolution shall satisfy the requirements of section 412:3-604; and
(5) Any financial institution whose capital is impaired or in danger of becoming impaired, and any institution which is
insolvent or in danger of becoming insolvent, may not undergo a voluntary dissolution.
(b) Subject to the approval of the commissioner, a solvent credit union whose capital is not impaired and which has not
received a notice of charges and proposed order of suspension or revocation pursuant to section 412:2-312 may elect
to dissolve voluntarily and liquidate its affairs in the manner prescribed in this section:
(1) The board of directors shall adopt a resolution adopting a plan of liquidation and dissolution, recommending the
voluntary dissolution of the credit union, and directing that the question of the dissolution be submitted to the
commissioner for approval and, if approved, requesting that the liquidation question be submitted to the members.
The plan of liquidation and dissolution shall include but not be limited to provisions for the orderly payment or
assumption of the credit union's deposits, shares, and other liabilities;
(2) Not later than ten days after the meeting of the board of directors described in paragraph (1), the credit union
shall file an application with the commissioner pursuant to section 412:3-603, for approval to cease business and
dissolve. The application shall be accompanied by a copy of the plan of liquidation and dissolution certified by two
executive officers of the credit union to have been duly adopted by the board and shall include any other
information that the commissioner may require. A copy of the notice shall be delivered contemporaneously to any
government agency or other organization insuring member accounts thereof, in writing, setting forth the reasons
for the proposed liquidation;
(3) The commissioner shall approve the application to cease business and dissolve if the commissioner is satisfied that
the depositors, beneficiaries, and creditors will be adequately protected under the plan, the credit union is not
insolvent or in danger of becoming insolvent, its capital is not impaired and is not in danger of becoming impaired,
and no other reason exists to deny the application. The commissioner may impose any restrictions and conditions
as the commissioner deems appropriate;
(4) Upon receipt of the commissioner's approval to cease business and dissolve and as soon as the board of directors
decides to submit the liquidation question to the members, all business affairs of the credit union, including but not
limited to payments on and withdrawals of shares, share certificates, share drafts, deposits, and deposit
certificates, (except for the transfer of shares or deposits to loans and interest), the making of investments of any
kind (other than short-term investments), and the issuing of loans, shall be suspended until the members act on the
liquidation question. Upon approval by the members, all business transactions of the credit union shall be
permanently discontinued. Transfer of deposits or shares to loans and interest, collection of loans and interest, and
the payment of necessary expenses of operation shall continue upon authorization by the board of directors or the
liquidating agent during liquidation;
(5) An affirmative majority vote by the members by ballot, in person, by letter, or other written communication, is
necessary for a credit union to enter into voluntary liquidation. Whenever authorization for liquidation is to be
obtained at a meeting of the members, notice in writing shall be given to each member, by first-class mail, at least
ten days prior to the meeting;
(6) Not later than ten days after the members act on the liquidation question, the chairperson of the board of
directors shall notify the commissioner and any government agency or other organization insuring member
accounts, in writing, of the action of the members on the liquidation question;
(7) A liquidating credit union shall remain in existence for the purpose of discharging its debts, collecting its loans,
distributing its assets, and any other necessary functions in order to conclude its business. A liquidating credit union
may sue or be sued for the purpose of enforcing its debts and obligations until its affairs are complete;
(8) The board of directors or the liquidating agent who may be the insurer shall use the assets of the credit union to
pay:
(A) First, the expenses incidental to liquidation including any surety bonds required during liquidation;
(B) Second, any liability due to nonmembers;
(C) Third, the deposits and deposit certificates of the members of the credit union; and
(D) Fourth, the remaining assets shall be distributed to the members in proportion to the number of shares held by
each member on the date dissolution was approved by the members;
(9) When the board of directors or the liquidating agent determines that all assets of the credit union having a
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reasonable expectancy of realization have been liquidated and distributed as provided in this section, the board
or the liquidating agent, whichever is applicable, shall complete a certificate of dissolution on a form prescribed
by the commissioner. Upon the completion of the certificate, the board or the liquidating agent, whichever is
applicable, shall file the certificate with the commissioner for the complete dissolution and liquidation of the
credit union; and
(10) Any credit union whose capital is impaired or in danger of becoming impaired, and any credit union that is
insolvent or in danger of becoming insolvent, may not undergo a voluntary dissolution.
(c) Subject to the approval of the commissioner, a nondepository financial services loan company may voluntarily cease
activity for which a license to operate as a financial services loan company is required by this chapter, in the manner
prescribed as follows:
(1) The board of directors shall adopt a resolution approving a plan to cease activity for which a license to operate as
a financial services loan company is required. If applicable, the plan shall include but not be limited to provisions
for the sale, exchange, or disposition of all loans or other business for which a financial services loan company
license is required by this chapter;
(2) The nondepository financial services loan company shall file an application with the commissioner pursuant to
section 412:3-603 for approval to cease activity for which a license to operate as a financial services loan
company is required. The application shall be accompanied by:
(A) A copy of the plan to cease activity for which a license to operate as a financial services loan company is
required, certified by two executive officers of the nondepository financial services loan company, to have
been duly adopted by the board;
(B) The information required in an application filed pursuant to section 412:3-613, if applicable; and
(C) Any other information that the commissioner may require;
(3) The commissioner shall approve the application to cease activity for which a license to operate as a financial
services loan company is required if:
(A) The commissioner is satisfied with the plan;
(B) The conditions for approval contained in section 412:3-613 have been met, if applicable; and
(C) No other reason exists to deny the application;
provided that the commissioner may impose any restrictions and conditions as the commissioner deems
appropriate; and
(4) Upon receipt of the commissioner's approval, a nondepository financial services loan company that has filed a
plan attesting that the company does not retain any loans or other business for which a financial services loan
company license is required by this chapter, shall forthwith surrender to the commissioner all of its financial
services loan company licenses. A nondepository financial services loan company that has filed a plan that
includes provisions for the sale, exchange, or disposition of loans or other business, upon receipt of the
commissioner's approval, shall proceed with its plan to cease activity for which a license to operate as a financial
services loan company is required. Upon completion of its plan, the nondepository financial services loan
company shall file a written notification with the commissioner. The written notification shall be accompanied by
the surrender of all of its financial services loan company licenses.
(d) Nothing in this section shall preclude the commissioner at any time from appointing a receiver or conservator for the
financial institution pursuant to this chapter, or from seeking any relief or sanction from the circuit court that may
otherwise be permitted by law.
Idaho
§ 26-2142. Voluntary and/or involuntary liquidation.
(a) A credit union may elect to dissolve voluntarily and wind up its affairs in the following manner: The board shall adopt a
resolution recommending that the credit union be dissolved voluntarily and directing that the question of dissolution
be submitted to a regular or special meeting of the members. After the adoption of the resolution to voluntarily
dissolve, no receipts shall be accepted nor withdrawals permitted from its share or deposit accounts, nor shall any
loans be made nor any dividends declared nor paid pending final determination by its membership on the voluntary
dissolution. At a meeting especially called to consider the matter, a majority of the entire membership may vote to
dissolve the credit union, provided a copy was mailed to the members of the credit union at least ten (10) days prior
thereto. Any member not present at such meeting may, within the next twenty (20) days vote in favor of or may
oppose dissolution by signing a statement in form approved by the department of finance and such vote shall have
the force and effect as if cast at such meeting. The credit union shall thereupon immediately cease to do business
except for the purposes of liquidation, and the president and secretary shall within five (5) days following such meeting
notify the department of finance of intention to liquidate and shall include a list of the names of the directors and
officers of the credit union together with their addresses.
(b) If the department of finance, after issuing notice of suspension and providing opportunity for a hearing, rejects the
credit union's plan to continue operations, the department of finance may issue a notice of involuntary liquidation and
appoint a liquidating agent. The credit union may request a stay of execution of such action by appealing to the
appropriate court of the jurisdiction in which the credit union is located. Involuntary liquidation may not be ordered
prior to following the suspension procedures outlined in this chapter.
(c) The credit union shall continue in existence for the purpose of discharging its debts, collecting and distributing its
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assets, and doing all acts required in order to wind up its business, and may sue and be sued for the purpose of
enforcing such debts and obligations until its affairs are fully adjusted. The board, or in the case of involuntary
dissolution, the liquidating agent, shall apply and distribute the assets of the credit union or the proceeds from any
disposition of the assets of the credit union in the following sequence:
(1) secured creditors up to the value of their collateral;
(2) costs and expenses of liquidation, including a surety bond that shall be required;
(3) wages due the employees of the credit union;
(4) costs and expenses incurred by creditors in successfully opposing the release of the credit union from certain debts
as allowed by the department of finance;
(5) taxes owed to the United States or any other governmental unit;
(6) debts owed to the United States;
(7) general creditors, secured creditors to the extent their claims exceed the value of their collateral and owners of
deposit accounts to the extent such accounts are uninsured; and
(8) members, to the extent of uninsured share accounts and the organization that insured the accounts of the credit
union.
As soon as the board or the liquidating agent determines that all assets from which there is a reasonable expectancy
of realization have been liquidated and distributed as set forth in this section, the director shall execute a certificate of
dissolution. The credit union shall be subject to examination by and reporting to the department of finance to
determine that all procedures have been observed as required by this chapter, and shall pay such examination fees
as are determined by the department of finance in accordance with its schedules.
(d) If the credit union shall not be completely liquidated and its assets discharged within three (3) years after the special
meeting of the members, the director may take possession of the books, records and assets and proceed to complete
liquidation. If the director determines after one (1) year from the commencement of liquidation proceedings that the
liquidation is not proceeding in a reasonable and expeditious manner under all of the circumstances, he may take
possession of the books, records, and assets and appoint a liquidating agent who shall give a bond to complete the
liquidation.
(e) Liquidation through the stabilization fund may be utilized after meeting the requirements of this section. The
procedure of liquidation shall be as outlined in the practice and procedure policies as adopted by the Idaho credit
union league stabilization fund and approved by the director of finance.
Illinois
(205 ILCS 305/62) (from Ch. 17, par. 4463)
Sec. 62. Liquidation.
(1) A credit union may elect to dissolve voluntarily and liquidate its affairs in the manner prescribed in this Section.
(2) The board of directors shall adopt a resolution recommending the credit union be dissolved voluntarily, and directing
that the question of liquidating be submitted to the members.
(3) Within 10 days after the board of directors decides to submit the question of liquidation to the members, the chairman
or president shall notify the Secretary thereof, in writing, setting forth the reasons for the proposed action. Within 10
days after the members act on the question of liquidation, the chairman or president shall notify the Secretary, in
writing, as to whether or not the members approved the proposed liquidation. The Secretary then must determine
whether this Section has been complied with and if his decision is favorable, he shall prepare a certificate to the effect
that this Section has been complied with, a copy of which will be retained by the Department and the other copy
forwarded to the credit union. The certificate must be filed with the recorder or if there is no recorder, in the office of
the county clerk of the county or counties in which the credit union is operating, whereupon the credit union must
cease operations except for the purpose of its liquidation.
(4) As soon as the board of directors passes a resolution to submit the question of liquidation to the members, payment on
shares, withdrawal of shares, making any transfer of shares to loans and interest, making investments of any kind and
granting loans shall be suspended pending action by members. On approval by the members of such proposal, all
such operations shall be permanently discontinued. The necessary expenses of operating shall, however, continue to
be paid on authorization of the board of directors or the liquidating agent during the period of liquidation.
(5) For a credit union to enter voluntary liquidation, it must be approved by affirmative vote of the members owning a
majority of the shares entitled to vote, in person or by proxy, at a regular or special meeting of the members. Notice, in
writing, shall be given to each member, by first class mail, at least 10 days prior to such meeting. If liquidation is
approved, the board of directors shall appoint a liquidating agent for the purpose of conserving and collecting the
assets, closing the affairs of the credit union and distributing the assets as required by this Act.
(6) A liquidating credit union shall continue in existence for the purpose of discharging its debts, collecting and distributing
its assets, and doing all acts required in order to terminate its operations and may sue and be sued for the purpose of
enforcing such debts and obligations until its affairs are fully adjusted.
(7) Subject to such rules and regulations as the Secretary may promulgate, the liquidating agent shall use the assets of the
credit union to pay; first, expenses incidental to liquidating including any surety bond that may be required; then,
liabilities of the credit union; then special classes of shares. The remaining assets shall then be distributed to the
members proportionately to the dollar value of the shares held by each member in relation to the total dollar value of
all shares outstanding as of the date the dissolution was voted.
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(8) As soon as the liquidating agent determines that all assets as to which there is a reasonable expectancy of sale or
transfer have been liquidated and distributed as set forth in this Section, he shall execute a certificate of dissolution on
a form prescribed by the Department and file the same, together with all pertinent books and records of the
liquidating credit union with the Department, whereupon such credit union shall be dissolved. The liquidating agent
must, within 3 years after issuance of a certificate by the Secretary referred to in Subsection (3) of this Section,
discharge the debts of the credit union, collect and distribute its assets and do all other acts required to wind up its
business.
(9) If the Secretary determines that the liquidating agent has failed to make reasonable progress in the liquidating of the
credit union's affairs and distribution of its assets or has violated this Act, the Secretary may take possession and control
of the credit union and remove the liquidating agent and appoint a liquidating agent to complete the liquidation
under his direction and control. The Secretary shall fill any vacancy caused by the resignation, death, illness, removal,
desertion or incapacity to function of the liquidating agent.
(10) Any funds representing unclaimed dividends and shares in liquidation and remaining in the hands of the board of
directors or the liquidating agent at the end of the liquidation must be deposited by them, together with all books and
papers of the credit union, with the State Treasurer in compliance with the Revised Uniform Unclaimed Property Act.
Indiana
IC 28-7-1-27.1 Dissolution.
A credit union may liquidate its affairs and dissolve in the following manner:
(1) The board of directors of a credit union may vote to submit the question of dissolution to the shareholders.
(2) Upon the decision of the board of directors under subdivision (1), payments on shares, withdrawal of shares, and the
granting of loans shall be immediately suspended, pending a vote by the shareholders on the question whether to
dissolve.
(3) The chairperson of the credit union shall, within ten (10) days after the decision of the board under subdivision (1),
notify the department in writing of the reasons for the proposed dissolution. The notice must include a certified
statement of condition of the credit union.
(4) Upon receiving the notice of dissolution, the department shall conduct an examination of the credit union.
(5) At either an annual meeting or a special meeting, the question of dissolution shall be approved or disapproved by
the shareholders. If approved, such approval shall be evidenced by the written consent of no fewer than two-thirds
(2/3) of the shareholders. Upon approval by the shareholders, payments on shares, withdrawal of shares, and
granting of loans shall cease. If two-thirds (2/3) of the vote cannot be obtained, the director may permit the
voluntary dissolution of the credit union to become effective without the affirmative vote of its membership if the
credit union field of membership has ceased or will cease to exist.
(6) If the department finds that the credit union is solvent or that it has sufficient assets with which to pay its shareholders
and all liabilities, it may approve the dissolution of the credit union and shall notify the credit union in writing.
(7) Upon receipt by the credit union of notice that the resolution for dissolution has been approved by the department,
each member and creditor shall be notified by the credit union in writing that such credit union is in the process of
dissolution. Notification to members shall include a request that such members verify, by passbook or in writing,
shareholdings in or loan obligations to the credit union. Notification to creditors shall include a request that such
creditors present claims to the credit union within ninety (90) days.
(8) The credit union shall be responsible for conserving the assets of the credit union, expediting the liquidation,
discharging all of the debts and liabilities of the credit union, and equitably distributing the assets to the shareholders
at the completion of the liquidation. The board shall ensure that all persons handling or having access to the funds,
books, or records of the credit union are adequately covered by a surety bond to the satisfaction of the department.
(9) The board of directors shall forward to the department a certified statement of condition of the credit union within ten
(10) days after the close of each month.
(10) Within thirty (30) days after the date of final distribution of the assets of the credit union to the shareholders, the board
of directors shall furnish to the department:
(A) a summary showing how the credit union debts and liabilities were paid;
(B) an itemized list of all credit union assets and property distributed to the shareholders, the name of each
shareholder, the number and amount of shares held by each at the time of distribution of assets, the amount
distributed to each, and the date of distribution; and
(C) the name and address of the custodian appointed by the board of directors, who shall preserve the records of
the credit union for five (5) years from the date of final distribution of the assets.
(11) The department shall file with the secretary of state triplicate copies of the resolution for dissolution bearing the
approval of the department as prescribed in IC 28-12-5. The secretary of state shall endorse each copy of the
resolution, file one (1) copy of the resolution, and issue and return a certificate of dissolution to the credit union
together with two (2) copies of the resolution for dissolution.
(12) The credit union shall file with the county recorder of the county in which the articles of incorporation were recorded
one (1) copy of the resolution for dissolution bearing the endorsement of the secretary of state. After this filing, the
credit union shall be dissolved and its existence shall cease.
(13) The credit union shall continue in its corporate capacity for three (3) years from the date of the resolution adopted by
the board as provided in subdivision (1), for the purpose of:
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(A) discharging its debts and obligations;
(B) collecting and distributing its assets; and
(C) doing all other acts required in order to terminate its business; but for no other purpose.
Iowa § 533.405 Voluntary dissolution.
The process of voluntary dissolution shall be as follows:
1. At a special meeting called for that purpose, a state credit union may dissolve upon the affirmative vote of a majority of
its members eligible to vote at the special meeting.
a. Notice of the meeting’s purpose shall be contained in the meeting’s notice.
b. Any member eligible to vote and not present at the meeting may, within twenty days after the date on which the
meeting was held, vote in favor of dissolution by signing a statement in a form approved by the superintendent. This
vote shall have the same force and effect as if cast at the meeting.
2. a. The state credit union shall cease to do business except for the purposes of liquidation immediately upon giving notice
of the special meeting called for the members’ vote on dissolution.
b. The board of directors shall immediately notify the superintendent of the intention of the state credit union to dissolve.
c. The state credit union shall not resume its regular business unless the dissolution fails to receive the required vote of the
members or unless the members have revoked prior affirmative action to dissolve as provided for in subsection 6.
3. a. The board of directors shall have power to terminate and settle the affairs of a state credit union in voluntary
dissolution.
b. The state credit union shall continue in existence for the purpose of discharging its liabilities, collecting and distributing
its assets, and doing all acts required in order to terminate its affairs.
c. The state credit union may sue and be sued for the purpose of enforcing such liabilities and for the purpose of
collecting its assets until its affairs are fully settled.
d. During the course of dissolution proceedings, the state credit union shall make such reports and shall be subject to
such examinations as the superintendent may require.
e. If at any time after the affirmative vote of a majority of the members of a state credit union to dissolve the state
credit union, the superintendent finds that the state credit union is not making reasonable progress toward
terminating its affairs, the superintendent may apply to the district court for appointment of a receiver to terminate
the affairs of the state credit union.
f. If the superintendent finds that a dissolving state credit union is insolvent, the superintendent may proceed as
otherwise provided in this chapter.
4. a. The board of directors may appoint by resolution any responsible person as defined in section 4.1, whose
appointment has been approved by the superintendent, to exercise its powers to terminate and settle the affairs of
the state credit union pursuant to this section.
b. The superintendent may adopt rules establishing the qualifications that must be met by such appointees, including
but not limited to filing a surety bond with the superintendent.
5. a. Upon such proof as is satisfactory to the superintendent that all assets have been liquidated from which there is a
reasonable expectance of realization, that the liabilities of the state credit union have been discharged and
distribution made to its members, and that the liquidation has been completed, the superintendent shall issue a
certificate of dissolution, which certificate shall be filed and recorded in the county in which the state credit union has
its principal place of business and in the county in which its original articles of incorporation were filed and recorded.
b. Upon the issuance of a certificate of dissolution, the existence of the state credit union shall cease.
6. a. At any time prior to any distribution of its assets, a state credit union may revoke the voluntary dissolution
proceedings by the affirmative vote of a majority of its members eligible to vote. This vote, if taken, shall be at a
special meeting called for that purpose in the manner prescribed by the bylaws.
b. The board of directors shall immediately notify the superintendent of any such action to revoke voluntary dissolution
proceedings.
Kansas § 17-2230: Voluntary and involuntary dissolution; procedures; liquidation procedure.
(a) Voluntary. At a meeting especially called to consider the matter, a majority of the entire membership may vote to
dissolve the credit union, provided a copy of the notice was mailed to the administrator at least 10 days prior thereto.
Any member not present at such meeting may, within the next 20 days, vote in favor of dissolution by signing a
statement in form approved by the administrator and such vote shall have the same force and effect as if cast at
such meeting. The credit union shall thereupon immediately cease to do business except for the purposes of
liquidation, and the executive officer of the board and secretary of the board shall, within five days following such
meeting, notify the administrator of intention to liquidate and shall include a list of the names of the directors and
officers of the credit union together with their addresses. Any credit union which has voted to enter into voluntary
dissolution may by action of its board of directors make a written application to the administrator for the appointment
of a liquidating agent and the administrator shall then exercise such powers of appointment, control and supervision
of a liquidating agent as is provided in K.S.A. 17-2206, and amendments thereto, and liquidate such credit union in
accordance with the provisions of this section.
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(c) Liquidating procedure. The credit union shall continue in existence for the purpose of discharging its debts, collecting
and distributing its assets, and doing all acts required in order to wind up its business and may sue and be sued for the
purpose of enforcing such debts and obligations until its affairs are fully adjusted.
The board of directors, or the liquidating agent shall use the assets of the credit union to pay in the following order: (1)
Expenses incidental to liquidation including any surety bond that may be required; (2) remaining liabilities other than
shareholdings; and (3) the assets then remaining, if any, shall be distributed to the savings held by each member or other
shareholder as of the date dissolution was voted.
As soon as the board or the liquidating agent determines that all assets from which there is a reasonable expectancy of
realization have been liquidated and distributed as set forth in this section, they shall execute a certificate of dissolution
on a form prescribed by the administrator and file same with the register of deeds of the county wherein the credit union
had its registered office, who shall, after recording and indexing same, forward it to the administrator, whereupon such
credit union shall be dissolved. The administrator shall furnish a copy of the certificate of dissolution to the secretary of
state.
Kentucky § 286.6-705. Voluntary liquidation -- Filing certificate of dissolution.
(1) A credit union may elect to dissolve voluntarily and liquidate its affairs in the manner prescribed in this section.
(2) The board of directors shall adopt a resolution recommending the credit union be dissolved voluntarily, and directing
that the question of liquidation be submitted to the members.
(3) Within ten (10) days after the board of directors decides to submit the question of liquidation to the members, the
president shall notify the commissioner and any government agency or other organization insuring member accounts
thereof in writing, setting forth the reasons for the proposed liquidation. Within ten (10) days after the members act on
the question of liquidation, the president shall notify the commissioner and any government agency or other
organization insuring member accounts in writing as to the action of the members on the proposal.
(4) As soon as the board of directors decides to submit the question of liquidation to the members, payments on shares,
share certificates, deposits, deposit certificates, withdrawal of shares, making any transfer of shares to loans and
interest, making investments of any kind, and granting loans shall be suspended pending action by members on the
proposal to liquidate. On approval by the members of such proposal, all such business transactions shall be
permanently discontinued. Necessary expenses of operation shall, however, continue to be paid on authorization of
the board of directors or liquidating agent during the period of liquidation.
(5) For a credit union to enter voluntary liquidation, approval by a majority of the members in writing or by a two-thirds
(2/3) majority of the members present at a regular or special meeting of the members is required. Where
authorization for liquidation is to be obtained at a meeting of the members, notice in writing shall be given to each
member, by first class mail, at least ten (10) days prior to such meeting.
(6) A liquidating credit union shall continue in existence for the purpose of discharging its debts, collecting on loans and
distributing its assets, and doing all acts required in order to wind up its business and may sue and be sued for the
purpose of enforcing such debts and obligations until its affairs are fully concluded.
(7) The board of directors or the liquidating agent shall use the assets of the credit union to pay: first, expenses incidental
to liquidation including any surety bond that may be required; second, any liability due non-members; third, deposits
and deposit certificates as provided in this subtitle. Assets then remaining shall be distributed to the members
proportionately to the shares held by each member of the date dissolution was voted.
(8) As soon as the board of directors or the liquidating agent determines that all assets from which there is a reasonable
expectancy of realization have been liquidated and distributed as set forth in this section, they shall execute a
certificate of dissolution on a form prescribed by the commissioner and file it, together with all pertinent books and
records of the liquidating credit union, with the commissioner, whereupon such credit union shall be dissolved.
Louisiana §660. Voluntary dissolution.
A. A credit union may elect to dissolve voluntarily and liquidate its affairs in the manner prescribed in this Section.
B. The board of directors shall adopt a resolution recommending the credit union be dissolved voluntarily, and directing
that the question of liquidation be submitted to the members.
C. Within ten days after the board of directors decides to submit the question of liquidation to the members, the president
shall notify the commissioner and any government agency or other organization insuring member accounts thereof in
writing, setting forth the reasons for the proposed liquidation. Within ten days after the members act on the question of
liquidation, the president shall notify the commissioner and any government agency or other organization insuring
member accounts, in writing, as to the action of the members on the proposal.
D. As soon as the board of directors decides to submit the question of liquidation to the members, payments on shares,
share certificates, deposits, deposit certificates, withdrawal of shares, making any transfer of shares to loans, and
interest, making investments of any kind, and granting loans shall be suspended, pending action by members on the
proposal to liquidate. On approval by the members of such proposal, all such business transactions shall be
permanently discontinued. Necessary expenses of operation shall continue to be paid on authorization of the board of
directors or liquidating agent during the period of liquidation.
E. For a credit union to enter voluntary liquidation, approval by a majority of the members, in writing or by a two-thirds
15
majority of the members present at a regular or special meeting of the members, is required. Where authorization for
liquidation is to be obtained at a meeting of the members, notice in writing shall be given to each member, by first
class mail, at least ten days prior to such meeting.
F. A liquidating credit union shall continue in existence for the purpose of discharging its debts, collecting on loans,
distributing its assets, and doing all acts required in order to wind up its business. It may sue and be sued for the purpose
of enforcing such debts and obligations until its affairs are fully concluded.
G. The board of directors or the liquidating agent shall use the assets of the credit union to pay: first, expenses incidental to
liquidation including any surety bond that may be required; second, any liability due non-members; third, deposits and
deposit certificates as provided in this Section. Assets then remaining shall be distributed to the members
proportionately to the shares held by each member as of the date dissolution was voted.
H. As soon as the board of directors or the liquidating agent determines that all assets from which there is a reasonable
expectancy of realization have been liquidated and distributed as set forth in this Section, they shall execute a
certificate of dissolution on a form prescribed by the commissioner and file the same, together with all pertinent books
and records of the liquidating credit union, with the commissioner, whereupon such credit union shall be dissolved.
I. A credit union having an occupational group common bond where the sponsor organization is dissolved must submit to
the commissioner of financial institutions for approval to continue the credit union service to its members a plan to
protect the rights of all members of record at the time of the loss of the sponsor organizations.
Maine §871-A. Dissolution.
1. Voluntary dissolution. This subsection governs the voluntary dissolution of a credit union.
A. A recommendation may be made that a credit union be dissolved and voluntarily liquidated by majority vote of
either the entire membership of the credit union entitled to vote or the board of directors of the credit union. Within
10 days after recommendation, the credit union shall notify the superintendent, the federal agency that insures the
credit union accounts and the credit union members in writing of the recommendation and the reasons for
dissolution. If the entire membership votes to dissolve and voluntarily liquidate the credit union, then no additional
votes of the entire membership need be taken. If the board of directors of the credit union votes to dissolve and
voluntarily liquidate the credit union, then a special meeting of the credit union's entire membership must be called,
no sooner than 10 days after notice has been mailed to the superintendent. A majority of the entire membership of
the credit union entitled to vote must vote to dissolve and voluntarily liquidate the credit union. Members may cast
their votes by proxy on forms prepared by the board of directors and mailed with the meeting notice.
B. Whenever there is a recommendation of dissolution pursuant to paragraph A, the board of directors shall provide the
superintendent with a plan of dissolution. The plan of dissolution must set forth the method and schedule for
terminating the business of the credit union and may provide for a restriction on withdrawal of shares or withdrawal of
share certificates. Before the 2nd membership vote required in paragraph A may be taken, the board must receive
the superintendent's approval of the plan of dissolution.
C. The superintendent may approve the dissolution of a credit union recommended by a majority of the entire board of
directors but approved by less than a majority of all members if the superintendent finds, upon the written and
verified application of the board, that:
(1) The board mailed written notice of the meeting to consider dissolution to all members qualified to vote;
(2) The notice disclosed the purpose of the meeting and that approval of dissolution might be sought pursuant to this
paragraph;
(3) A majority of the votes cast by the members were in favor of dissolution; and
(4) The board has an acceptable plan of dissolution.
D. If the superintendent approves dissolution, either by vote of the board or vote of the members, the credit union shall
immediately cease to do business, except for the express purposes of liquidation including the discharging of debts,
collecting on loans, distributing assets and every other act necessary to wind up and liquidate the business. It may
sue and be sued for the purpose of enforcing such debts and obligations until its affairs are fully adjusted.
E. The board of directors shall use the assets of the credit union to pay claims in the following order:
(1) Claimants whose claims are secured must receive their security. To the extent their respective claims exceed the
value of the security for those claims, as determined to the satisfaction of the receiver, they each have an
unsecured claim against the credit union having priority as provided in subparagraph (2); and
(2) Unsecured claims against the liquidation estate that are proved to the satisfaction of the receiver have priority in
the following order:
(a) Administrative costs and expenses of liquidation;
(b) Claims for wages and salaries, including vacation, severance and sick leave pay;
(c) Taxes legally due and owing to the United States or any state or subdivision of the United States or state;
(d) Debts due and owing to the State and the United States, including the National Credit Union Administration;
(e) General creditors, and secured creditors to the extent that the secured creditors' respective claims exceed
the value of the security for those claims;
(f) Pro rata distribution to members in proportion to the respective amount of their deposits and shares;
(g) In a case involving liquidation of a corporate credit union, membership capital of the corporate credit union;
(h) In a case involving liquidation of a designated community development credit union, any outstanding
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secondary capital accounts issued pursuant to state law; and
(i) In a case involving liquidation of a corporate credit union, paid-in capital.
F. Priorities for payment of claims under paragraph E are to be based on the circumstances that exist on the date of
the liquidation.
G. If the repudiation or disaffirmance of any contract or lease gives rise to a claim for damages, the claim must be
considered a general creditor claim under paragraph E, subparagraph (2), division (e) and not a cost or expense of
liquidation under paragraph E, subparagraph (2), division (a).
H. All unsecured claims of any category or class or priority described in paragraph E, subparagraph 2, divisions (a) to (i)
must be paid in full, or provisions made for such payment, before any claims of lesser priority are paid. If there are
insufficient funds to pay all claims of a category or class, payment must be made pro rata. Notwithstanding anything
to the contrary in this section, the receiver may, at any time, and from time to time, prior to the payment in full of all
claims of a category or class with higher priority, make such distributions to claimants in priority categories described
in paragraph E, subparagraph (2), divisions (a) to (e) as the receiver believes are reasonably necessary to conduct
the liquidation, as long as the receiver determines that adequate funds exist or will be recovered during the
liquidation to pay in full all claims of any higher priority. If a surplus remains after making distribution in full on all
allowed claims described in paragraph E, subparagraph (2), divisions (a) to (i), the surplus must be distributed pro rata
to the credit union's members.
I. A credit union liquidating voluntarily may not continue in existence for more than 3 years after approval of dissolution,
unless an extension is granted by the superintendent for good cause shown in an application filed prior to expiration
of the 3-year period.
J. After all debts, liabilities and obligations of the credit union are paid or discharged or otherwise adequately provided
for, the credit union shall file articles of dissolution with the Secretary of State. Articles of dissolution must set forth:
(1) The name and address of the credit union;
(2) The date dissolution was approved;
(3) A statement of how dissolution was approved;
(4) A report of liquidating activities; and
(5) Such other information as the superintendent may require.
Dissolution is effective upon the superintendent's acceptance of articles of dissolution for filing with the bureau. At the
time of the superintendent's acceptance of the filing, the credit union ceases to exist, except for the purposes of suits or
other proceedings provided for by law.
Maryland § 6-804. Voluntary dissolution
(a) General rule. -- Any credit union may dissolve voluntarily, if the board, the members of the credit union, and the
Commissioner approve the dissolution as provided in this section.
(b) Director's actions. -- A majority of the board of a credit union proposing to dissolve shall adopt a resolution that:
(1) Recommends that the credit union be dissolved voluntarily; and
(2) Directs that a proposal of dissolution be submitted to the members.
(c) Approval by members. --
(1) A proposed dissolution shall be approved at an annual or special meeting of the members or by mail ballot by the
affirmative vote of two-thirds of the entire membership of the credit union.
(2) The Commissioner may substitute any reasonable method of determining the vote of the members.
(d) Filing with Commissioner. -- After a proposed dissolution is approved by the members, the credit union shall file with the
Commissioner:
(1) A copy of the resolution of the board recommending voluntary dissolution, attested to by:
(i) The chairman or vice chairman of the board; and
(ii) The secretary or treasurer of the credit union;
(2) A verified statement of the names and addresses of the officers and directors of the credit union; and
(3) The vote by which the voluntary dissolution was approved by the members.
(e) Approval by Commissioner; filing with Department of Assessments and Taxation. --
(1) If the Commissioner finds that the credit union is solvent, the Commissioner shall issue to the credit union duplicate
certificates stating that the credit union appears to have complied with this section.
(2) The credit union shall file one of the certificates with the State Department of Assessments and Taxation.
(f) When dissolution effective. -- When the certificate is filed with the State Department of Assessments and Taxation, the
credit union is dissolved.
(g) Winding up. --
(1) On dissolution, a credit union may operate only to wind up its business and affairs.
(2) Under the direction of the Commissioner, the liquidating agent of the dissolved credit union, appointed by the
board, shall:
(i) Discharge its debts and obligations;
(ii) Collect and distribute its assets; and
(iii) Do anything else necessary to wind up its business and affairs.
(3) For 3 years after the dissolution becomes effective, the credit union, acting by its board and liquidating agent:
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(i) Shall continue in existence for the purpose of winding up its business and affairs; and
(ii) May sue and be sued in its name.
Massachusetts Chapter 171, Section 81.
At any regular or special meeting, if proper notice of the purpose has been given, the members, upon recommendation
of not less than two-thirds of the board of directors, may, by a majority vote of those present and entitled to vote, vote to
liquidate the credit union. If a credit union is a member of the Massachusetts Credit Union Share Insurance Corporation, a
committee of four shall be appointed in the following manner for the purpose of conserving and liquidating the assets,
under the direction of said Massachusetts Credit Union Share Insurance Corporation and the commissioner: two members
of the committee shall be appointed by the board of directors of the Massachusetts Credit Union Share Insurance
Corporation, and two members shall be appointed by the liquidating credit union. If the credit union is not a member of
the Massachusetts Credit Union Share Insurance Corporation, a committee of four members shall thereupon be elected
by the members of the credit union for the purpose of conserving and liquidating the assets, under the direction of the
commissioner. Any vacancy in the membership of the committee shall be filled by the remaining members thereof. The
committee, in the name of the credit union, may prosecute and defend all suits and other legal proceedings and may
execute all deeds and other instruments necessary to effectuate any sale of real or personal property or any compromise
authorized by the committee; and any instrument so executed shall be valid and effectual to the same extent as though
executed by the officers of the credit union by authority of its board of directors or of its members. After the credit union
has voted to liquidate, no receipts shall be accepted for, or withdrawals be allowed from, its share or deposit accounts
and no shares shall be transferred to deposits. No loans shall be offset against shares except as approved by the
committee.
After the payment of all debts and deposits, all holders of claims arising out of the ownership of shares, including persons
who have not received payment for shares after requesting the withdrawal thereof, shall be entitled to the remaining
assets in liquidation in proportion to their respective interests therein. The charter of a credit union in process of liquidation
shall become void except for the purpose of discharging existing obligations and liabilities.
Funds representing unclaimed dividends in liquidation and remaining in the hands of the liquidating committee for six
months after the date of the final dividend, shall be deposited by them together with all books and papers of the credit
union, with the commissioner. Such funds shall be deposited in one or more trust companies, savings banks or national
banks or on paid up shares and accounts of and in cooperative banks, or be used to purchase share accounts of a
federal savings and loan association located in the commonwealth to the credit of the commissioner in his official
capacity in trust for the members of the liquidating credit union entitled thereto, according to their several interests. Upon
receipt of evidence satisfactory to him, the commissioner may pay over the money so held by him to the persons
respectively entitled thereto.
In cases of doubt or of conflicting claims, he may require an order of the supreme judicial court authorizing and directing
the payment thereof. He may apply the interest earned by the moneys so held toward defraying the expenses incurred in
the payment of such unclaimed dividends. At the expiration of twelve months from the date of receipt thereof, such
funds as still remain in the hands of the commissioner shall be disposed of as provided in section thirty-five of chapter one
hundred and sixty- seven.
The provisions of this section providing for a preference in the payment of deposit liability shall not apply to credit unions
which are insured in full.
Michigan
§ 490.331 Voluntary or involuntary dissolution.
(1) A domestic credit union may voluntarily dissolve under subsection (2) or be involuntarily dissolved under subsection (3).
(2) A domestic credit union may voluntarily dissolve if all of the following are met:
(a) At least 30 days before the vote described in subdivision (b), the credit union board mails a notice to each
member of the domestic credit union that it is considering dissolution. The credit union board shall not include the
notice with any other mailing sent to the member. The notice shall include all of the following:
(i) A brief explanation of why the board is considering dissolution.
(ii) A brief summary of the major positive and negative effects of the proposed dissolution.
(iii) A request for written comments on the proposed dissolution.
(b) By an affirmative vote of 2/3 of all of the directors entitled to vote, the credit union board approves of a plan of
dissolution and submits the plan and any member comments to the commissioner for preliminary review.
(c) Before the vote of the members under subdivision (g), the commissioner reviews the dissolution plan and any
member comments on the dissolution plan and grants preliminary approval. The commissioner shall grant
preliminary approval of the dissolution plan only if the commissioner is satisfied of all of the following:
(i) The dissolution plan adequately discloses to the members information concerning the advantages and
disadvantages of the proposed dissolution.
(ii) The dissolution does not circumvent a pending supervisory action that is initiated by the commissioner or
another regulatory agency because of a concern over the safety and soundness of the domestic credit union.
(iii) The dissolution plan does not provide any official or employee of the domestic credit union with any
remuneration or other economic benefit in connection with the dissolution of the domestic credit union.
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(d) If the commissioner grants preliminary approval under subdivision (c), the credit union board shall call a special
meeting of the members to vote on the dissolution plan and mail to each member notice of the meeting and
proposed dissolution 90 days and 60 days before the date of the special meeting. Each notice shall include all of
the following:
(i) A summary of the positive and negative effects of the proposed dissolution.
(ii) A statement that the officials and employees will not receive any remuneration or other economic benefit in
connection with the dissolution of the domestic credit union.
(iii) A statement that any interested person may obtain more detailed information about the dissolution from the
domestic credit union at its principal place of business or by any method approved in advance by the
commissioner.
(iv) A statement that the credit union board may substantively amend the proposed plan of dissolution before the
special meeting based on comments from regulatory authorities or any other reason and that the credit union
board may terminate the proposed plan of dissolution.
(v) Instructions for obtaining a copy of the dissolution plan.
(vi) The date of the special meeting and a statement that the vote on the dissolution will close on that date.
(vii) Any other information required by the commissioner.
(e) Thirty days before the special meeting of the members, the credit union board mails a notice of the meeting and
proposed dissolution. The notice shall include all of the information described in subdivision (d) for the 90-day and
60-day notices and shall include the date, time, and place of the special member meeting, a ballot and postage-
paid return envelope, and a summary of the methods permitted for casting votes.
(f) If the plan of dissolution is substantively amended by the credit union board, at least 30 days before the vote of the
members on the plan the credit union board shall mail a notice to each member. The notice shall contain the
information concerning the amended plan of dissolution that is described in subdivision (d) for a notice under that
subdivision.
(g) At a special meeting of members, the members approve of the dissolution and the plan of dissolution by a 2/3 vote
of members voting. A member may vote in person or by mail. With the prior approval of the commissioner, a
domestic credit union may accept member votes by an alternative method that is reasonably calculated to
ensure each member has an opportunity to vote.
(h) The domestic credit union files with the commissioner all of the following:
(i) Certified copies of records of all proceedings held by the credit union board and members of the domestic
credit union.
(ii) Copies of member comments submitted to the domestic credit union under subdivision (a)(iii).
(iii) If that consent or approval is required, a certified copy of the consent or approval of a federal regulatory
authority.
(i) If subdivisions (a) through (h) are met and the commissioner determines that the notices to members were
accurate, timely, and not misleading and that conduct of the vote on the dissolution plan was fair and lawful, the
commissioner shall approve the dissolution and the credit union board may implement the dissolution plan.
Minnesota
§ 52.20 VOLUNTARY DISSOLUTION.
Subdivision 1. Special meeting; liquidation committee.
A credit union may be voluntarily liquidated after two-thirds of the members present and entitled to vote shall have voted
such liquidation at a special meeting called by a majority of the board of directors for that purpose, upon 14 days mailed
written notice to each member at the member's last known address clearly stating the purpose of the special meeting, or
at any regular meeting after like notice of the purpose has been given. By a majority vote of the members present and
entitled to vote at the meeting, a committee of three members shall be elected to liquidate the credit union.
Vacancies in this committee shall be filled by the remaining members of the committee, acting jointly with the board of
directors serving at the time of the vote for liquidation, or by and with the approval of any ten or more shareholders. In
case the remaining members of the committee or a majority of said board of directors shall notify the commissioner of
commerce that a vacancy cannot be filled in the manner therein provided, the commissioner shall have authority to fill
the vacancy from the membership of the credit union as it existed at the time of the vote for liquidation.
Subd. 2.Recording documents; commissioner's approval; bond.
Immediately after this meeting and before the committee shall proceed with the liquidation, the officers of the credit
union shall file with the commissioner of commerce a certified copy of the minutes of this meeting, a written statement
outlining the plan of liquidation, and a verified statement, in writing, signed by a majority of the officers, consenting to this
liquidation containing the names and addresses of all officers and directors of the credit union. After the commissioner of
commerce shall, by proper examination, determine that the credit union is solvent, the commissioner shall, within 60 days,
issue a certificate of approval of the liquidation, which certificate shall be recorded with the county recorder in the
county where the credit union is located. A "solvent" credit union is one which is able to pay all of its debts and deposits.
From and after this special meeting the credit union shall cease to do business except for purposes of liquidation. Before
commencing the liquidation the committee shall execute and file with the commissioner of commerce a bond running to
the state of Minnesota for the benefit of the members and creditors of the credit union in such amount and with such
sureties and in such form as shall be approved by the commissioner of commerce, conditioned for the faithful
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performance of all duties of its trust. A bond may be waived in case of a bulk sale of assets to one or more purchasers
upon terms approved by the commissioner of commerce. Such purchasers may include other credit unions or an
association of credit unions.
Subd. 3.Time of dissolution.
Upon recording this certificate with the county recorder, the credit union shall be deemed dissolved and its corporate
existence terminated except for the purpose of discharging its debts, collecting and distributing its assets, and doing all
other acts required in order to liquidate. The credit union shall have a corporate existence and may sue and be sued.
Subd. 4.Commissioner's intervention.
If the credit union shall not be completely liquidated and its assets discharged within three years after the special
meeting of the members, the commissioner of commerce may take possession of the books, records and assets and
proceed to complete liquidation. If the commissioner determines after one year from the commencement of
liquidation proceedings that the liquidation is not proceeding in a reasonable and expeditious manner under all of the
circumstances, the commissioner may take possession of the books, records, and assets and appoint a liquidating
agent who shall give a bond running to the state of Minnesota.
Subd. 5.Unclaimed dividends.
Funds representing unclaimed dividends in liquidation in the hands of the liquidating committee or the commissioner of
commerce for six months after date of final dividend, shall be deposited with the commissioner of management and
budget, who shall, within one year thereafter, pay over the money so held to the persons respectively entitled thereto
upon being furnished satisfactory evidence of their right to the same, and at the end of that year the commissioner of
management and budget shall credit all residue of the deposit to the general fund. There is hereby appropriated to the
persons entitled to such amounts, from the funds or accounts in the state treasury to which the money was credited, an
amount sufficient to make the payment.
Subd. 6.Final statement.
Upon completion of the liquidation by the liquidating committee, it shall file with the commissioner of commerce a
verified statement in writing signed by the members of the committee stating that all debts of the credit union, and all
deposits, and all shares, or portions of shares which can be paid from the liquidation proceeds, have been paid, except
any unclaimed dividends, and if any such, the amount thereof, the names of the persons entitled thereto, with their last
known addresses, and all books and papers of the credit union shall thereupon be deposited with the commissioner of
commerce.
Mississippi SEC. 81-13-59. Voluntary dissolution.
At any meeting, called for the purpose, notice of the purpose being contained in the call, a majority of the entire
membership may vote to dissolve the corporation and shall, thereupon signify their consent to such dissolution in writing
and shall file such consent with the Commissioner of Banking and Consumer Finance, attested by a majority of its officers,
with a statement of the names and addresses of the directors and officers, duly verified. The commissioner, upon receipt
of satisfactory proof of the solvency of the corporation, shall execute in duplicate a certificate to the effect that such
consent and statement have been filed and that it appears therefrom that the corporation had complied with this
section. Such duplicate certificate shall be filed by such corporation in the office of the clerk of the chancery court of the
county in which said corporation has its place of business and thereupon such credit union shall be dissolved and shall
cease to carry on business except for the purpose of adjusting and winding up its affairs. It shall, by its board of directors,
then proceed to adjust and wind up its business, be empowered to carry out its contracts, collect its accounts receivable,
and liquidate its assets and apply the same in discharge of the obligations of the corporation and, after paying such
obligations, each share according to the amount paid in thereon, shall be entitled to its proportion of the balance of the
assets. Said corporation shall continue in existence for the purpose of discharging its debts and obligations, collecting and
distributing its assets, and doing all other acts required in order to wind up its business, and may sue and be sued for the
purpose of enforcing such debts and obligations until its affairs are fully adjusted and wound up, for three (3) years.
Missouri § 370.350. Dissolution of credit union, liquidation procedure, rulemaking authority, procedure, generally, this chapter.
1. At any meeting called for the purpose, notice of the purpose being contained in the call, three-fourths of the
membership present may vote to dissolve the credit union and shall thereupon signify their consent to such dissolution
in writing and shall file such consent with the director of the division of credit unions attested by a majority of its officers,
with a statement of the names and addresses of the directors and officers duly verified.
2. The director of the division of credit unions shall execute in duplicate a certificate to the effect that such consent and
statement have been filed and that it appears therefrom that the credit union has complied with this section.
3. Such duplicate certificate shall be filed by the credit union in the office of the secretary of state.
4. The director shall then appoint the share insurer or guarantor of the credit union, or other suitable person or persons, or
entities, as liquidating agent, who shall proceed to liquidate the credit union by procedures as defined by rules and
regulations.
5. The director of the division of credit unions is authorized to promulgate rules and regulations concerning the dissolution
of credit unions and, upon the termination of such credit union, and upon notice to the director from his or her
appointed liquidating agent, the director of the division of credit unions shall notify the secretary of state of such final
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dissolution.
6. No rule or portion of a rule promulgated under the authority of this chapter shall become effective unless it has been
promulgated pursuant to the provisions of section 536.024.
7. The director of the division of credit unions, with the consent of another credit union, may transfer the existing
membership and related field of membership of a credit union in dissolution to the second credit union and the
liquidating agent, upon receiving notice of such action, shall forward its records of the members so to be transferred to
the second credit union.
8. Notwithstanding any other provisions of this section, following a membership vote to dissolve the credit union, the
director of the division of credit unions, or his or her appointee, may at the request of the board of directors proceed to
bring about an orderly dissolution of the credit union as provided in subsection 4 of this section.
Montana § 32-3-321. Liquidation.
(1) A credit union may elect to dissolve voluntarily and liquidate its affairs in the manner prescribed in this section.
(2) The board of directors shall adopt a resolution recommending the credit union be dissolved voluntarily and directing
that the question of liquidation be submitted to the members.
(3) Within 14 days after the board of directors decides to submit the question of liquidation to the members, the presiding
officer of the board shall notify the department of administration in writing, setting forth the reasons for the proposed
action and a plan for liquidation. Within 14 days after the members act on the question of liquidation, the presiding
officer of the board shall notify the department in writing as to whether or not the members approved the proposed
liquidation.
(4) Depending on the credit union's circumstances, a proposed liquidation plan may or may not require the suspension of
payment on shares, withdrawal of shares, transfer of shares to loans and interest, investments of any kind, loans, or
other similar financial transactions. On approval by the members of the proposal, all business transactions must be
permanently discontinued. Necessary expenses of operation must continue to be paid on authorization of the
liquidating agent or committee during the period of liquidation.
(5) For a credit union to enter voluntary liquidation, approval by a majority of the members in writing or by a two-thirds
majority of the members present at a regular or special meeting of the members is required. If authorization for
liquidation is to be obtained at a meeting of the members, notice in writing must be given to each member, by first-
class mail, at least 14 days prior to the meeting.
(6) If liquidation is approved, the board of directors shall appoint a liquidating agent or committee for the purpose of
conserving and collecting assets, closing the affairs of the credit union, and distributing the assets as required by this
chapter.
(7) A liquidating credit union shall continue in existence for the purpose of discharging its debts, collecting and distributing
its assets, and doing all acts required in order to wind up its business. The liquidating credit union may sue and be sued
for the purpose of enforcing debts and obligations until its affairs are fully adjusted.
(8) The liquidating agent or committee shall distribute the assets of the credit union or the proceeds of any disposition of
the assets in the sequence described in 32-3-205(6).
(9) As soon as the liquidating agent or committee determines that all assets from which there is a reasonable expectancy
of realization have been liquidated and distributed as set forth in this section, the liquidating agent or committee shall
execute a certificate of dissolution on a form prescribed by the department. The form, together with all pertinent
records of the liquidating credit union, must be filed with the department and the secretary of state. Upon filing with
both entities, the credit union is dissolved.
(10) If the department determines that the liquidating agent or committee has failed to make reasonable progress in the
liquidating of the credit union's affairs and distribution of its assets or has violated a provision of this chapter, the
department may issue a cease and desist order against the liquidating agent or committee and appoint a new
liquidating agent to complete the liquidation under the department's direction and control. The department shall fill
any vacancy caused by the resignation, death, illness, removal, desertion, or incapacity to function of the liquidating
agent.
Nebraska
§ 21-17,108. Liquidation.
(1) A credit union may elect to dissolve voluntarily and liquidate its affairs in the manner prescribed in this section.
(2) If the board of directors decides to begin dissolution procedures, the board shall adopt a resolution recommending
that the credit union be dissolved voluntarily and directing that the question of liquidation be submitted to the credit
union members.
(3) Within ten days after the board of directors decides to submit the question of liquidation to the members, the
president shall notify the department and the National Credit Union Administration in writing of such decision and
setting forth the reasons for the proposed liquidation. Within ten days after the members act on the question of
liquidation, the president shall notify the department and the National Credit Union Administration in writing as to the
action of the members on the proposal.
(4) As soon as the board of directors decides to submit the question of liquidation to the members, payments on,
withdrawal of, and making any transfer of share accounts to loans and interest, making investments of any kind, and
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granting of loans may be restricted or suspended pending action by the members on the proposal to dissolve. Upon
approval by the members of the question of liquidation, all business transactions shall be permanently discontinued.
Necessary expenses of operation shall continue to be paid upon the authorization of the board or the liquidating
agent during the period of liquidation.
(5) For a credit union to enter voluntary liquidation, approval by a majority of the members in writing or by a two-thirds
majority of the members present at a regular or special meeting of the members shall be required. When
authorization for liquidation is to be obtained at a meeting of the members, notice in writing shall be given to each
member, by first-class mail, at least ten days prior to such meeting.
(6) A liquidating credit union shall continue in existence for the purpose of discharging its debts, collecting on loans and
distributing its assets, and doing all acts required in order to conclude its business and may sue and be sued for the
purpose of enforcing such debts and obligations until its affairs are fully concluded.
(7) The board of directors or the liquidating agent shall distribute the assets of the credit union or the proceeds of any
disposition of the assets pursuant to section 21-1734.
(8) As soon as the board of directors or the liquidating agent determines that all assets from which there is a reasonable
expectancy of realization have been liquidated and distributed pursuant to section 21- 1734, the board or the
liquidating agent shall execute a certificate of dissolution on a form prescribed by the department and shall file the
same, together with all pertinent books and records of the liquidating credit union, with the department and the
credit union shall be dissolved.
Nevada NRS 678.820 Voluntary dissolution.
1. At a meeting called to consider dissolution, the membership may vote to dissolve a credit union if notice of the
meeting is mailed to the members at least 10 days prior thereto. Any member who is not present at the meeting may,
within 20 days after the meeting, vote by signing a form furnished by the Division and filing the form with the secretary
of the credit union. An affirmative vote of a majority of the members who vote at the meeting or by filing the form is
required to dissolve the credit union.
2. If the members vote to dissolve, the credit union shall, except for the purpose of liquidation, cease its business
operations immediately.
3. The chair shall, within 5 days after an affirmative vote to dissolve the credit union, notify the Division by mail of the credit
union’s intention to liquidate and include with the notice a list of the names and addresses of the directors and
officers.
NRS 678.840 Procedure for liquidation.
1. A liquidating credit union shall continue in existence for the purpose of discharging its debts, collecting and distributing
its assets, and doing any other acts required to wind up its business.
2. The board or, in the case of involuntary dissolution, the liquidating agent, shall pay from the assets, the obligations of the
credit union in the following order:
(a) Expenses incidental to liquidation including any surety bond that may be required.
(b) Any liability due to nonmembers.
(c) Deposits and savings club accounts.
If any assets remain, they shall be distributed to the members proportionately to the number of shares held by each
member as of the date dissolution was approved by the members or ordered by the Commissioner.
3. As soon as the board or the liquidating agent determines that all assets from which there is a reasonable expectancy
of realization have been liquidated and distributed as set forth in this section, he or she shall execute a certificate of
dissolution on a form provided by the Division and shall file such form with the proper recording authority within the
county in which the credit union has its principal place of business. After filing or recording, and indexing the original
form shall be forwarded to the Division and upon its receipt and filing such credit union shall be officially dissolved.
New Hampshire §383-E:12-1201. Dissolution.
If a special meeting is called for the purpose of addressing dissolution of a credit union and a majority of the members are
in attendance, upon recommendation of not less than 2/3 of the board of directors, the members may dissolve the credit
union by the vote of 2/3 of the members present and voting at a meeting called for that purpose.
§383-E:12-1202. Procedure.
Upon a vote dissolving the credit union, the members shall elect a committee of 3 persons to liquidate the assets of the
credit union. The committee shall act under the control of the bank commissioner. Each paid-in share according to the
amount paid in shall be entitled to its proportional part of the assets in liquidation after all deposits and debts have been
paid.
New Jersey § 17:13-122. Voluntary dissolution; liquidation; notice to authorities; suspension of activities; approval of members; wind-up of
affairs; distribution of assets; certificate of dissolution.
a. A credit union may elect to dissolve voluntarily and liquidate its affairs in the manner prescribed in this section.
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b. The board shall adopt a resolution recommending the credit union be dissolved voluntarily, and directing that the
question of liquidation be submitted to the members.
c. Within 10 days after the board decides to submit the question of liquidation to the members, the chairman shall notify
the commissioner and any government agency or other organization insuring member accounts thereof in writing,
setting forth the reasons for the proposed liquidation. Within 10 days after the members act on the question of
liquidation, the chairman shall notify the commissioner and any government agency or other organization insuring
member accounts, in writing, as to the action of the members on the proposal.
d. As soon as the board decides to submit the question of liquidation to the members, payments on shares, share
certificates, deposits, deposit certificates, withdrawal of shares, making any transfer of shares to loans and interest,
making investments of any kind, and granting loans shall be suspended pending action by members on the proposal to
liquidate. On approval by the members of the proposal, all business transactions shall be permanently discontinued.
Necessary expenses of operation shall, however, continue to be paid on authorization of the board or liquidating agent
during the period of liquidation.
e. For a credit union to enter voluntary liquidation, approval by a majority of the members in writing or by a two-thirds
majority of the members present at a regular or special meeting of the members is required. Where authorization for
liquidation is to be obtained at a meeting of the members, notice in writing shall be given to each member, by first
class mail at least 10 days prior to the meeting.
f. A liquidating credit union shall continue in existence for the purpose of discharging its debts, collecting on loans and
distributing its assets, and doing all acts required in order to wind up its business and may sue and be sued for the
purpose of enforcing the debts and obligations until its affairs are fully concluded.
g. The board or the liquidating agent shall use the assets of the credit union to pay: (1) expenses incidental to liquidation
including any surety bond that may be required; (2) any liability due nonmembers; and (3) deposits and deposit
certificates as provided in this act. Assets then remaining shall be distributed to the members proportionately to the
shares held by each member as of the date dissolution was voted.
h. As soon as the board or the liquidating agent determines that all assets from which there is a reasonable expectancy of
realization have been liquidated and distributed as set forth in this section, they shall execute a Certificate of
Dissolution, on a form prescribed by the commissioner, and file the same, together with all pertinent books and records
of the liquidating credit union, with the commissioner, whereupon the credit union shall be dissolved.
New Mexico § 58-11-58. Dissolution.
A. A credit union may elect to dissolve voluntarily and liquidate its affairs in the manner prescribed in this section.
B. If it decides to begin the procedure, the board of directors shall adopt a resolution recommending the credit union be
dissolved voluntarily and directing that the question of liquidation be submitted to the members.
C. Within ten days after the board of directors decides to submit the questions of liquidation to the members, the
chairman of the board or executive officer shall notify the director and the insuring organization in writing, setting forth
the reasons for the proposed liquidation. Within ten days after such notice, a special meeting of the members shall be
called to vote on whether to liquidate the credit union. Within ten days after the members act on the question of
liquidation, the chairman of the board or executive officer shall notify the director and the insuring organization in
writing as to the action of the members on the proposal.
D. When the board of directors decides to submit the question of liquidation to the members, payments on, withdrawal
of and making any transfer of share and deposit accounts to loans and interest, making investments of any kind and
granting loans may be restricted or suspended pending action by members on the proposal to liquidate. On approval
by the members of the proposal, all business transactions shall be permanently discontinued. Necessary expenses of
operations shall, however, continue to be paid on authorization of the board of directors or liquidating agent during
the period of liquidation.
E. For a credit union to enter voluntary liquidation, approval by a majority of the members in writing or by a two-thirds
majority of the members present at a meeting of the members is required. When authorization for liquidation is to be
obtained at a meeting of the members, notice in writing shall be given to each member, by first class mail, at least ten
days prior to that meeting.
F. A liquidating credit union shall continue in existence for the purpose of discharging its debts, collecting on loans and
distributing its assets and doing all acts required in order to wind up its business and it may sue and be sued for the
purpose of enforcing those debts and obligations until its affairs are fully concluded.
G. The board of directors or the liquidating agent shall distribute the assets of the credit union or the proceeds of any
disposition of the assets in the sequence described in Section 58-11-3 NMSA 1978.
H. When the board of directors or the liquidating agent determines that all assets from which there is a reasonable
expectancy of recovery have been liquidated and distributed as set forth in this section, they shall execute a
certificate of dissolution on a form prescribed by the director and file the same, together with all pertinent books and
records of the liquidating credit union, with the director, whereupon the credit union shall be dissolved.
New York § 465. Withdrawal of shares after voting to liquidate; notices to shareholders.
After the shareholders of a credit union have duly voted that the credit union be closed and such business wound up and
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voluntarily liquidated, and prior to the entry of an order of the supreme court declaring the business of such credit union
closed, any shareholder withdrawing any or all of his shares shall be given written notice by the credit union at the time of
such withdrawal on the withdrawal notice, that it has been duly voted to close the corporation, wind up its business and
voluntarily liquidate, that application may be made to the supreme court for a closing order pursuant to subdivision four
of section six hundred five of this chapter, and that by receiving payment for the shares surrendered, he will not be
entitled to any part of the surplus which may remain upon final liquidation and which would have been credited upon
such shares had the same remained until the time that the closing order was obtained. If the notice is not given as
aforesaid, the shareholder shall be entitled to share in the surplus, as if he had not made the withdrawal.
North Carolina § 54-109.93. Liquidation.
(a) A credit union may elect to dissolve voluntarily and liquidate its affairs in the manner prescribed in this section.
(b) The board of directors shall adopt a resolution recommending the credit union be dissolved voluntarily, and directing
that the question of liquidation be submitted to the members.
(c) Within 10 days after the board of directors decides to submit the question of liquidation to the members, the
president shall notify the Administrator of Credit Unions thereof in writing, setting forth the reasons for the proposed
action. Within 10 days after the members act on the question of liquidation, the president shall notify the
Administrator in writing as to whether or not the members approved the proposed liquidation.
(d) As soon as the board of directors decides to submit the question of liquidation to the members, payment on shares,
withdrawal of shares, making any transfer of shares to loans and interest, making investments of any kind, and
granting loans shall be suspended pending action by members on the proposal to liquidate. On approval by the
members of such proposal, all such business transactions shall be permanently discontinued. Necessary expenses of
operation shall, however, continue to be paid on authorization of the board of directors or liquidating agent during
the period of liquidation.
(e) For a credit union to enter voluntary liquidation, approval by a majority of the members in writing or by a two-thirds
majority of the members present at a regular or special meeting of the members is required. Where authorization for
liquidation is to be obtained at a meeting of the members, notice in writing shall be given to each member, by first-
class mail, at least 10 days prior to such meeting.
(f) A liquidating credit union shall continue in existence for the purpose of discharging its debts, collecting and distributing
its assets, and doing all acts required in order to wind up its business and may sue and be sued for the purpose of
enforcing such debts and obligations until its affairs are fully adjusted.
(g) The board of directors or the liquidating agent shall use the assets of the credit union to pay: first, expenses incidental
to liquidating including any surety bond that may be required; second, any liability due nonmembers; third, deposits
and special purpose thrift accounts as provided in Articles 14A to 14L of this Chapter. Assets then remaining shall be
distributed to the members proportionately to the shares held by each member as of the date dissolution was voted.
(h) As soon as the board of directors or the liquidating agent determines that all assets from which there is a reasonable
expectancy of realization have been liquidated and distributed as set forth in this section, the Administrator of Credit
Unions shall issue to such corporation, in duplicate, a certificate of dissolution which shall be filed by the corporation
in the office of the register of deeds of the county in which the corporation has its place of business. The corporation
shall then be dissolved and its certificate of incorporation revoked. All pertinent books and records of the liquidating
credit union shall be retained by the liquidating agent and/or filed with the Credit Union Division and kept for a
minimum period not to exceed five years. The liquidating agent's fee, if any, shall be set by the Administrator of Credit
Unions.
North Dakota § 6-06.1-01. Approval of liquidation - Notice to commissioner.
A credit union may go into voluntary liquidation on approval of a majority of its members in writing or by a vote in favor
of such liquidation by a majority of the members of the credit union at a regular meeting of the members or at a special
meeting called for that purpose. When authorization for liquidation is to be obtained at a meeting of members, notice in
writing must be given to each member at least seven days before such meeting and the minutes of the meeting must
show the number of members present and the number that voted for and against liquidation. If approval by a majority
of all members is not obtained at the meeting of members, authorization for voluntary liquidation may be obtained by
having a majority of members sign a statement in substantially the following form:
We the undersigned members of the Credit Union, Charter No. , hereby request
the dissolution of our credit union.
Within ten days after the decision of the board of directors to submit the question of liquidation to the members, the
president shall notify the commissioner thereof in writing, setting forth in detail the reasons for the proposed action. Within
ten days after the action of the members on the question of liquidation, the president shall notify the commissioner in
writing as to whether a majority of the members approved the proposed liquidation.
§ 6-06.1-02. Transactions during liquidation.
Immediately on decision by the board of directors of a credit union to seek approval of the members for liquidation,
payments on shares, withdrawal of shares including any transfer of shares to loans and interest, making investments of
any kind, and granting of loans must be suspended pending action by members on the proposal to liquidate, and on
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approval by a majority of the members of such proposal, payments on shares, withdrawal of shares including any
transfer of shares to loans and interest, making investments of any kind, and the making of loans must be permanently
discontinued. Necessary expenses of operation must, however, continue to be paid on authorization by the board of
directors or liquidating agent during the period of the liquidation.
§ 6-06.1-03. Notice of liquidation to members - Creditors.
Immediately on decision by the board of directors, a notice of such decision must be handed to each member or
mailed to the member's last-known address together with a request that the member furnish the member's passbook or
confirm in writing the shares held by the member in the credit union and the loans owed by the member to the credit
union.
On approval of a majority of the members of a credit union of a proposal to liquidate, the board of directors of the
credit union shall immediately have prepared and mailed to all creditors a notice of liquidation containing instructions to
them to present their claims to the credit union within ninety days for payment.
§ 6-06.1-04. Report at commencement of liquidation - Reports during period of liquidation.
At the commencement of voluntary liquidation of a credit union, the treasurer or agent conducting the liquidation shall
file with the commissioner a financial and statistical report and a schedule showing the name, book number, share
balance, and loan balance of each member.
Credit unions in the process of voluntary liquidation shall file with the commissioner a financial and statistical report as of
December thirty-first within ten days after such date. Additional reports, as determined by the commissioner to be
necessary, must be furnished promptly on written request.
§ 6-06.1-05. Examinations in voluntary liquidation.
When deemed advisable by the commissioner, an examination of the books and records of a credit union may be
made prior to, during, or following completion of voluntary liquidation. A fee for each examination must be assessed at
the rate currently in effect for examinations of operating credit unions. Fees must be collected by the commissioner,
transferred to the state treasurer, and deposited in the financial institutions regulatory fund.
§ 6-06.1-06. Responsibility for conduct of voluntary liquidation.
The board of directors of a credit union in voluntary liquidation is responsible for conserving the assets, for expediting the
liquidation, and for equitably distributing the assets to members. The board of directors shall determine that all persons
handling or having access to funds of the credit union are adequately covered by surety bond. The board of directors
shall appoint a custodian for the credit union's records that are to be retained for five years after the charter is canceled.
The board of directors may appoint a liquidating agent and delegate part or all of these responsibilities to the agent and
may authorize reasonable compensation for the agent's services. Any such liquidating agent must be bonded for faithful
performance of the agent's duties. The supervisory committee is responsible for making periodic audits of the credit
union's records, at least quarterly, during the period of liquidation.
§ 6-06.1-07. Partial distribution.
With the written approval of the commissioner, a partial distribution of the credit union's assets may be made to its
members from cash funds available on authorization by its board of directors or by a duly authorized liquidating agent
whose appointment specifically includes such authority.
§ 6-06.1-08. Completion of liquidation.
When all assets of the credit union have been converted to cash or found to be worthless and all loans and debts owing
to it have been collected or found to be uncollectible and all obligations of the credit union have been paid, with the
exception of amounts due its members, the books must be closed and the pro rata distribution to members computed.
The amount of gain or loss must be entered in each member's share account and should be entered in the member's
passbook or statement of account.
§ 6-06.1-09. Distribution of assets.
Promptly after the pro rata distribution to members has been computed, checks must be drawn for the amounts to be
distributed to each member who has surrendered the member's passbook or has given a written confirmation of the
member's balance. The checks must be mailed to such members at their last-known addresses or handed to them in
person. The passbooks or written confirmations submitted by members to verify balances must be retained with the credit
union records. The commissioner must be notified promptly of the date final distribution of assets to the members is
started. Unclaimed share accounts which have been dormant for the period which makes them subject to the escheat
or abandoned property laws of the state of North Dakota must be paid to the state as required by such laws.
§ 6-06.1-10. Final report.
Within one hundred twenty days after the final distribution to members is started, the credit union shall furnish to the
commissioner's office the following:
1. A schedule on an official form of unpaid claims, if any, due members who failed to surrender their passbooks or
confirm their balances in writing during liquidation whose accounts are not payable to the state under applicable
escheat or abandoned property laws, and of unpaid claims, if any, due members or creditors who failed to cash final
distribution checks within the said one hundred twenty days; this schedule must be accompanied by a certified check
or money order payable to the state treasurer in the exact amount of the total of these unpaid claims. The state
treasurer will deposit said funds in a special account where they will be held for the account of the individuals named
on said schedule. Each such individual or any authorized person on the individual's behalf may submit to the state
treasurer a written claim for the amount of such funds held for the individual.
2. A schedule on an official form showing the name, book number, share balance at the commencement of liquidation,
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pro rata share of gain or loss, and the amount of each unclaimed share account paid to the state under applicable
escheat or abandoned property laws. The check number and date of payment to the state should be included in the
schedule.
3. A schedule on an official form showing the name, book number, share balance at the commencement of liquidation,
pro rata share of gain or loss, and the amount distributed to each member.
4. A summary report on liquidation in duplicate on an official form.
5. The certificate of dissolution and liquidation on an official form signed under oath by the board of directors or agent
who conducted the liquidation and made the final distribution of assets to the members.
6. The name and address of the custodian of the credit union’s records.
7. The charter of the credit union.
§ 6-06.1-11. Retention of records - Cancellation of charter.
All records of the liquidated credit union necessary to establish that creditors were paid and that members'
shareholdings were equitably distributed must be retained by a custodian appointed by the board of directors of said
credit union for a period of five years following the date of cancellation of the charter.
On proof that distribution of assets has been made to members and within one year after receipt of the certificate of
dissolution and liquidation, the commissioner shall cancel the charter of the credit union concerned.
§ 6-06.1-12. Further instructions and information.
Further detailed instructions, information, and official forms pertaining to voluntary liquidations may be obtained from the
commissioner's office, Bismarck, North Dakota, 58505.
Ohio § 1733.35 Dissolution.
A majority of the entire membership may vote to dissolve the credit union at a regular or special meeting called for that
expressly stated purpose. Any member, within twenty days of the date of the mailing of notice of such meeting, may
vote on the question of dissolution by signing a statement in form approved by the superintendent of credit unions, and
such vote shall have the same force and effect as any other vote. The credit union shall thereupon immediately cease
to do all business except for the purpose of liquidation, and the president and secretary shall, within fifteen days
following such meeting, notify the superintendent in writing of its intention to liquidate, and shall include in such notice a
list of the names of directors and officers of the credit union together with their addresses.
Oklahoma
O.S. §, 2018. Voluntary Dissolution.
A credit union may elect to dissolve voluntarily and liquidate its affairs. The process of voluntary dissolution shall be as
follows:
(A) The board of directors shall adopt a resolution recommending the credit union be dissolved voluntarily, and directing
that the question of dissolution be submitted to the members. For a credit union to enter voluntary dissolution,
approval by a majority of the members in writing or by a simple majority vote of the members at a regular or special
meeting of the members is required. Where authorization for dissolution is to be obtained at a meeting of the
members, notice in writing shall be given to each member, by first-class mail, at least ten (10) days prior to such
meeting.
(B) Within ten (10) days after the board of directors decides to submit the question of dissolution to the members, the
president shall notify the Bank Commissioner and any government agency or other organization insuring member
accounts thereof in writing, setting forth the reasons for the proposed dissolution. Within ten (10) days after the
members act on the question of dissolution, the president shall file with the Bank Commissioner a statement of their
consent to dissolution, attested by a majority of the officers and including the names and addresses of the officers
and directors, and shall notify any government agency or other organization insuring member accounts in writing as
to the action of the members on the proposal. As soon as the board of directors decides to submit the question of
dissolution to the members, payments on shares or deposits, withdrawal of shares or deposits, making any transfer of
shares or deposits to loans and interest, making investments of any kind and granting loans may be suspended, only
with the approval of the Bank Commissioner, pending action by members on the proposal to dissolve. On approval
by the members of such proposal, all such business transactions shall be permanently discontinued. Necessary
expenses of operation shall, however, continue to be paid on authorization of the board of directors or liquidating
agent during the period of dissolution.
(C) The Bank Commissioner shall determine whether or not the credit union is solvent. If the credit union is solvent, the
Bank Commissioner shall issue in duplicate a certificate to the effect that this section has been complied with.
(D) The certificate shall be filed with the Secretary of State, and a certified copy thereof filed in the office of the county
clerk of the county in which the credit union is located, whereupon said credit union shall cease to carry on business,
except for the purpose of liquidation and distribution of its assets.
(E) The credit union shall continue in existence for the purpose of discharging its debts, collecting and distributing its
assets, and doing all other acts required in order to wind up its business, and may sue and be sued for the purpose of
enforcing such debts and obligations until its affairs are fully adjusted. The board of directors or, in the case of
involuntary dissolution, the liquidating agent shall use the assets of the credit union to pay; first, expenses incidental to
liquidation including any surety bond that may be required; and second, any liability due nonmembers. Assets then
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remaining, if any, shall be distributed to the members proportionately to the combined shares and deposits held by
each member as of the date dissolution was voted, unless otherwise provided in the bylaws.
Oregon
§ 723.676 Liquidation.
(1) A credit union may elect to dissolve voluntarily and liquidate its affairs in the manner prescribed in this section.
(2) The board of directors shall adopt a resolution recommending the credit union be dissolved voluntarily and directing
that the question of liquidation be submitted to the members.
(3) Within 10 days after the board of directors decides to submit the question of liquidation to the members, the
president or chairperson of the board shall notify the Director of the Department of Consumer and Business Services
thereof in writing setting forth the reasons for the proposed action. Within 10 days after the members act on the
question of liquidation, the president or chairperson of the board shall notify the director in writing as to whether or
not the members approved the proposed liquidation.
(4) As soon as the board of directors decides to submit the question of liquidation to the members, payment on shares,
withdrawal of shares, making any transfer of shares to loans and interest, making investments of any kind and granting
loans shall be suspended pending action by members on the proposal to liquidate. On approval by the members of
such proposal, all such business transactions shall be permanently discontinued. Necessary expenses of operation
shall, however, continue to be paid on authorization of the board of directors or liquidating agent during the period
of liquidation.
(5) For a credit union to enter voluntary liquidation, approval by a majority of the members in writing or by a two-thirds
majority of the members present at a regular or special meeting of the members is required. Where authorization for
liquidation is to be obtained at a meeting of the members, notice in writing shall be given to each member by first
class mail to the member’s last-known address at least 10 days prior to such meeting.
(6) A liquidating credit union shall continue in existence for the purpose of discharging its debts, collecting and
distributing its assets and doing all acts required in order to wind up its business and may sue and be sued for the
purpose of enforcing such debts and obligations until its affairs are fully adjusted.
(7) The board of directors or the liquidating agent shall use the assets of the credit union to pay: First, expenses incidental
to liquidating including any surety bond that may be required; and, second, any liability due nonmembers. Assets
then remaining shall be distributed to the members proportionately to the shares and deposits held by each member
as of the date dissolution was voted.
(8) As soon as the board of directors or the liquidating agent determines that all assets from which there is a reasonable
expectancy of realization have been liquidated and distributed as set forth in this section, they shall execute a
certificate of dissolution on a form prescribed by the director and file the same, together with all pertinent books and
records of the liquidating credit union, with the director, whereupon such credit union shall be dissolved.
Pennsylvania
§ 1301. Dissolution authorized.
Any credit union may elect to dissolve voluntarily and wind up its affairs in the manner provided in this chapter. However,
if it shall appear to the department, upon an examination of the business, assets and affairs of the credit union, that its
assets will probably be insufficient to pay in full its members and creditors, it shall take possession of the business and
property of the credit union and retain possession until its affairs are finally liquidated.
§ 1302. Approval of voluntary dissolution.
(a) General rule.--The procedure for voluntary dissolution shall be as follows:
(1) A plan of dissolution, setting forth in detail the number of liquidating trustees, which shall be one, three or five, to be
elected by the members, the amount of the bond which shall be supplied by each of the liquidating trustees and
the powers, duties and compensation of such trustees, shall be adopted by a vote of at least two-thirds of all
directors of the credit union.
(2) A meeting of the membership shall be called for the purpose of acting on the plan of dissolution. Notice setting
forth the date and purpose of such meeting shall be furnished each member at least ten days prior to the date of
the meeting. The plan of dissolution shall be adopted upon the affirmative vote of a majority of the entire
membership of the credit union in person or by written ballot.
(3) Upon approval of the plan, the members shall forthwith proceed to elect the number of liquidating trustees
provided for in the plan of dissolution. If more than one liquidating trustee is to be elected, each member shall
have the right to multiply his vote by the number of trustees to be elected and cast the whole number of such votes
for one candidate or distribute them among two or more candidates. The candidates receiving the highest
number of votes up to the number of liquidating trustees to be chosen shall be elected.
(4) A certificate of election to dissolve signed by a duly authorized officer of the credit union shall be executed and
delivered to the department. The certificate shall set forth:
(i) The name of the credit union.
(ii) The exact location of its place of business.
(iii) The names and addresses of its officers and directors.
(iv) The number of directors voting for, and the number voting against, the proposed plan of voluntary dissolution.
(v) The total number of members and the number of members voting for, and the number voting against, the
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proposed plan of voluntary dissolution.
(vi) The names and addresses of the proposed liquidating trustees and the number of votes received by every
candidate for the position of liquidating trustee.
(vii)The amount of the bond required to be supplied by each trustee.
(viii) A verified statement by each of the proposed liquidating trustees stating that he is willing to serve as
liquidating trustee, subject to the provisions of this chapter and to the terms of the proposed plan of voluntary
dissolution, that he will, so far as the duty devolves upon him, diligently and honestly liquidate the affairs of the
credit union, and will not knowingly violate or permit to be violated any of the provisions of this chapter or of
the proposed plan of voluntary liquidation.
(ix) The proposed plan of voluntary dissolution.
(b) Department review.--Upon receipt of the certificate of election to dissolve, the department shall conduct an
examination or an investigation, or take such other action as it deems necessary, to determine whether to approve
the plan of voluntary dissolution. If the department determines that the plan of voluntary dissolution does not prejudice
the interests of members or creditors, it shall endorse its approval on the certificate of election to dissolve and send it to
the Department of State for filing. If the department disapproves the plan, it shall return the certificate to the credit
union stating in detail its reasons for doing so.
(c)Effect of filing certificate.--Upon the filing by the Department of State of the certificate of election to dissolve, the
Department of State shall furnish a copy thereof to the department and the credit union. Upon such filing, the
credit union shall cease to transact its business, and the liquidating trustee or trustees shall commence the
liquidation of the credit union. The liquidating trustee or trustees shall thereafter be authorized to carry out, in his
own name or in their own names as liquidating trustee or trustees of the credit union, the powers granted to him or
them by the plan of voluntary dissolution and may sue and be sued for the purpose of determining and enforcing
the debts due the credit union and its obligations.
(d) Cross reference.--See 15 Pa.C.S. § 134 (relating to docketing statement).
§ 1303. Dissolution proceedings.
(a) Collection and distribution of assets.--The liquidating trustee or trustees shall proceed in the manner provided by the
department to gather the assets, determine the liabilities and distribute the assets of the credit union until its affairs are
fully adjusted and wound up. Under this section the department shall set forth the order of the distribution of the
assets. The provisions of this section on distribution of assets apply whether the dissolution is voluntary or involuntary.
(b) Proof of claims.--The liquidating trustee or trustees shall notify all creditors and members appearing on the records of
the association, by notice sent to or given at the address appearing for such creditor or member on the records or, if
no address appears there, at the last known address of the creditor or member, of the amount which the records
show to be due such member or creditor. The liquidating trustee or trustees shall also advertise, for three successive
weeks in a newspaper of general circulation and in a legal newspaper, if any, in the county in which the credit union
is located, that the credit union is liquidating pursuant to a plan of voluntary liquidation. The advertisement shall set
forth a date not less than 90 days after the date of the first published advertisement before which all creditors or
members must present their claims, under oath or affirmation, to the trustee or trustees or be bound by the amount
shown on the records of the credit union to be due them. Thereafter, all claims shall be permanently barred.
(c) Limitation period.--Any claim which is rejected or disallowed by the trustee or trustees shall be barred unless an action
is brought thereon within 90 days after mailing of the notice of rejection or disallowance.
(d) Transfer possession.--If the department takes possession of the credit union under section 503(c) (relating to regulation
by department) and appoints the National Credit Union Administration to liquidate the credit union or take other
action deemed appropriate regarding the credit union, then the department shall be deemed to have surrendered
jurisdiction of the credit union and the department shall have no liability related to such credit union.
§ 1304. Department supervision.
The department shall continue to supervise the credit union, in the hands of the liquidating trustee or trustees, until the
liquidation is complete and the affairs of the credit union are fully settled.
§ 1305. Articles of dissolution.
(a) General rule.--When, in the opinion of the department, the liquidation of a credit union is complete and its affairs are
fully settled, the department shall execute and file in the Department of State articles of dissolution, which shall set
forth:
(1) The name of the credit union.
(2) The statute under which the credit union was incorporated and the date of incorporation.
(3) A statement that the liquidation of the credit union is complete and its affairs are fully settled.
(b) Filing procedures.--A certificate or statement provided for by 15 Pa.C.S. § 139 (relating to tax clearance of certain
fundamental transactions) shall not be required and the Department of State shall not charge a fee in connection
with the filing of articles of dissolution under this section. See 15 Pa.C.S. § 134 (relating to docketing statement).
(c) Effect.--Upon the filing of the articles of dissolution in the Department of State, the existence of the credit union shall
cease.
Rhode Island Silent
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South Carolina SECTION 34-26-1200. Dissolution; voluntary liquidation; distribution of assets.
(1) A credit union may elect to dissolve voluntarily and liquidate its affairs in the manner prescribed in this section.
(2) If it decides to begin the procedure, the board of directors shall adopt a resolution recommending the credit union
be dissolved voluntarily, and directing that the question of liquidation be submitted to the members.
(3) Within ten days after the board of directors decides to submit the question of liquidation to the members, the credit
union shall notify the Board of Financial Institutions and the insuring organization in writing, setting forth the reasons for
the proposed liquidation. Within ten days after the members act on the question of liquidation, the credit union shall
notify the Board of Financial Institutions and the insuring organization in writing as to the action of the members on the
proposal.
(4) As soon as the board of directors decides to submit the question of liquidation to the members, payments on,
withdrawals of, and making any transfer of share and deposit accounts to loans and interest, making investments of
any kind, and granting loans may be restricted or suspended pending action by members on the proposal to
liquidate. On approval by the members of such proposal, all such business transactions shall be permanently
discontinued. Necessary expenses of operation shall, however, continue to be paid on authorization of the board of
directors or liquidating agent during the period of liquidation.
(5) For a credit union to enter voluntary liquidation, approval is required by a two-thirds majority of the members voting in
accordance with Section 34-26-570(2) of this chapter at a regular or special meeting of the members. When
authorization for liquidation is to be obtained at a meeting of the members, notice in writing shall be given to each
member, by first class mail, at least ten days prior to such meeting. Certification of the voluntary liquidation shall be
filed with the board accompanied by the resolution of the board of directors and a certified extract of the
shareholders' meeting approving the liquidation.
(6) A liquidating credit union shall continue in existence for the purpose of discharging its debts, collecting on loans and
distributing its assets, and performing all duties required in order to wind up its business and may sue and be sued for
the purpose of enforcing such debts and obligations until its affairs are fully concluded.
(7) The board of directors or the liquidating agent shall distribute the assets of the credit union or the proceeds of any
disposition of the assets in the sequence described in Section 34-26-220(6).
(8) As soon as the board of directors or the liquidating agent determines that all assets from which there is a reasonable
expectancy of realization have been liquidated and distributed as set forth in this section, they shall execute a
certificate of dissolution and file the same, together with all pertinent books and records of the liquidating credit
union, with the Board of Financial Institutions, whereupon such credit union shall be dissolved.
Tennessee § 45-4-901. Dissolution.
(a) A majority of the entire membership of any credit union may vote to dissolve the credit union at a regular or special
meeting called for that expressly stated purpose.
(b) Any member, within twenty (20) days of the date of the mailing of notice of the meeting, may vote on the question of
dissolution by signing a statement in a form approved by the commissioner, and the vote shall have the same force
and effect as any other vote.
(c) The credit union shall, upon a vote for dissolution, immediately cease to do all business except for the purpose of
liquidation, and the president and secretary shall, within fifteen (15) days following the meeting, notify the
commissioner in writing of its intention to liquidate, and shall include in the notice a list of the names of directors and
officers of the credit union together with their addresses.
§ 45-4-902. Liquidation.
(a) A credit union under order to liquidate or in the course of dissolution or liquidation shall continue in existence for the
purpose of discharging its debts, collecting and distributing its assets, and doing all acts required in order to wind up its
business, and may sue and be sued for the purpose of enforcing the debts and obligations until its affairs are fully
adjusted. The board of directors of the credit union, or, in the case of involuntary dissolution or liquidation by order of
the commissioner, the liquidating agent, shall use the assets of the credit union to pay:
(1) All expenses incidental to liquidation, including, but not limited to, any surety bond that may be required;
(2) Any liability due nonmembers; and
(3) Redemption of shares, share accounts, and members' special accounts.
Assets then remaining shall be distributed to the members proportionately to the purchase price of shares held by
each member as of the date dissolution was voted, or the date of order of liquidation or suspension by the
commissioner, as the case may be.
(b) As soon as the board or the liquidating agent determines that all assets from which there is a reasonable expectancy
of realization have been liquidated and distributed as set forth in this section, it shall execute a certificate of
dissolution and forward the same to the commissioner, who shall review the details of the liquidation and, if
approving it, shall issue a certificate of approval and return the certificate to the board or liquidating agent, who
shall then file it with the secretary of state and thereafter with the office of the register of deeds of the county in
which the credit union has its principal place of business.
(c) If a credit union has filed a certificate of dissolution or has indicated an intention to file the certificate, and the
directors and officers of the credit union, in the opinion of the commissioner, are not conducting the liquidation
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proceedings in an expeditious, orderly, and efficient manner or in the best interests of its members, the commissioner
may terminate the liquidation proceedings, take possession of the business and property of the credit union, and, for
the purpose of carrying out the liquidation, may appoint, or cause to be appointed, a liquidating agent. The
liquidating agent shall furnish bond for the faithful discharge of duties in an amount to be approved by the
commissioner.
(d) The liquidating agent may, under rules and regulations that the supervisor prescribes:
(1) Receive and take possession of the books, records, assets, and property of every description of the credit union in
liquidation; sell, enforce collection of, and liquidate the assets and property; compound all bad or doubtful debts;
sue in the name of the credit union in liquidation; and defend actions brought against the liquidating agent in that
capacity or against the credit union;
(2) Receive, examine, and pass upon all claims against the credit union in liquidation, including claims of members;
(3) Make distribution and payment to creditors and members as their interests appear;
(4) Execute documents and papers and do other acts that the liquidating agent deems necessary or desirable to
discharge duties; and
(5) The expenses incurred by the liquidating agent in the liquidation of the credit union include the compensation of
the liquidating agent and any other necessary or proper expenses connected therewith, all of which shall be paid
in order of priority out of the property of the credit union in the hands of the liquidating agent. The expenses of
liquidation, including the compensation of the liquidating agent, are subject to approval by the commissioner
unless the agent is appointed by the court.
Texas
Sec. 126.451. BOARD RESOLUTION.
Unless the commissioner has issued a liquidation order, the board may adopt a resolution recommending voluntary
dissolution of the credit union and directing submission of the question of liquidation to the members of the credit union.
Sec. 126.452. NOTIFICATION TO COMMISSIONER OF PROPOSED LIQUIDATION.
Not later than the fifth day after the date on which the board's resolution recommending voluntary dissolution is
adopted, the board's presiding officer shall notify the commissioner in writing of the reasons for the proposed liquidation.
Sec. 126.453. NOTICE OF MEETING TO LIQUIDATE.
Notice of the special meeting to consider voluntary liquidation shall be mailed by first-class mail to each member of the
credit union and the commissioner not later than the 10th day before the date of the meeting.
Sec. 126.454. CREDIT UNION OPERATIONS BEFORE AND AFTER VOTE.
Immediately after notice under Section 126.453 is mailed, the commissioner may restrict control or give direction with
respect to the continued business of the credit union pending consideration of voluntary liquidation by the members.
During that period, no member shall withdraw an aggregate amount in excess of the share insurance covered by the
credit union. No new extensions of credit shall be funded during the period between the board of directors' adoption of
the resolution recommending voluntary liquidation and the membership meeting called to consider voluntary
liquidation, except for the issuance of loans fully secured by a pledge of shares and the funding of outstanding loan
commitments approved before adoption of the resolution. If the vote to dissolve and liquidate the credit union is
affirmative, the credit union may conduct only business incidental to liquidation.
Sec. 126.455. VOTE ON VOLUNTARY LIQUIDATION.
At a special meeting called to consider the proposed liquidation, a majority of the credit union members, but not less
than a quorum, may vote to dissolve and liquidate the credit union. Those members casting votes by mail or at the
meeting constitute a quorum for the transaction of business at the special meeting, notwithstanding a bylaw provision to
the contrary.
Sec. 126.456. NOTICE TO COMMISSIONER OF AFFIRMATIVE VOTE TO LIQUIDATE.
(a) The board's presiding officer or president and the secretary shall notify the commissioner of the intention to liquidate
not later than the fifth day after the affirmative vote to dissolve and liquidate.
(b) The person notifying the commissioner must include a list of the names and addresses of the credit union's officers and
directors with the notice.
Sec. 126.457. APPOINTMENT OF LIQUIDATING AGENT.
(a) If the members approve the liquidation, the board shall appoint a liquidating agent to:
(1) conserve and collect the credit union's assets;
(2) wind up the credit union's affairs;
(3) discharge the credit union's debts;
(4) distribute the credit union's assets; and
(5) take any other action necessary and incidental to liquidating the credit union.
(b) The National Credit Union Administration or other insuring organization has the right of first refusal to be appointed as
liquidating agent of any credit union that it insures.
Sec. 126.458. APPLICATION OF LAW TO CREDIT UNION IN VOLUNTARY LIQUIDATION.
A credit union in the process of voluntary dissoluion and liquidation remains subject to this subtitle and Chapter 15,
including provisions for examination by the commissioner, and the credit union shall furnish reports as required by the
commissioner.
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Utah § 7-9-36. Dissolution.
(1) A credit union may be dissolved upon a majority vote of the entire membership.
(2) A copy of a notice of a special meeting to consider the matter shall be mailed to the members of the credit union
at least 10 days before the date of the meeting.
(3) Any member not present at the meeting may within the following 20 days vote for or against dissolution by
signing a statement approved by the commissioner. A vote cast in this manner has the same force and effect
as if cast at the meeting. A member not voting within the 20-day period is considered to be in favor of the
dissolution.
(4) The officers of the credit union may appoint a liquidating agent, subject to the approval of the commissioner,
who has the right to exercise all the powers of the dissolved credit union to wind up its affairs. If the liquidating
agent is other than a bona fide trade association of authorized credit unions recognized by the commissioner, or
the National Credit Union Administration, the liquidator shall provide a bond or other security, as required by the
commissioner, for the faithful discharge of duties in connection with the liquidation, including accounting for all
money collected.
(5) Upon the vote required under this section, a certificate of dissolution, signed by the chair of the board and the
secretary, shall be filed with the commissioner and shall state the vote cast in favor of dissolution, the proposed
date upon which the credit union will cease to do business, the names and addresses of the directors and officers
of the credit union and the name and address of the liquidating agent appointed by the officers of the credit
union. The commissioner shall approve the dissolution unless he finds that the procedures set forth in this section
have not been properly followed.
(6) Upon approval, the credit union shall cease to do business except for the purpose of discharging its debts,
collecting and distributing assets, and doing all acts required to adjust, wind up, and dissolve its business and
affairs. It may sue and be sued for the purpose of enforcing debts or obligations until its affairs are fully adjusted.
(7) If the board or the liquidating agent determines that all assets from which a reasonable return could be expected
have been liquidated and distributed, it shall execute a certificate of dissolution in a form approved by the
commissioner and file it with the department and the Division of Corporations and Commercial Code. After the
certificate has been filed, the credit union is dissolved.
Vermont § 36101. Suspension, voluntary liquidation, and involuntary liquidation.
(b) Voluntary liquidation. At a meeting specially called to consider the matter, a majority of the entire membership may
vote to dissolve the credit union, if a copy of the notice was mailed to the members of the credit union at least ten
days prior thereto. Any member not present at the meeting may within the next 20 days vote in favor of dissolution by
signing a statement in a form approved by the commissioner, and the vote shall have the same force and effect as if
cast at the meeting. The credit union shall thereupon immediately cease to do business except for the purposes of
liquidation, and the chairperson of the governing body and secretary shall, within five days following the meeting,
notify the commissioner of the credit union's intention to liquidate and shall include in the notification a list of the
names and addresses of the directors and officers of the credit union.
(d) Liquidating procedure. The credit union shall continue in existence for the purpose of discharging its debts, collecting
and distributing its assets, and doing all acts required in order to wind up its business and may sue and be sued for the
purpose of enforcing those debts and obligations until its affairs are fully adjusted. The governing body or, in the case
of involuntary dissolution, the liquidating agent shall use the assets of the credit union to pay: first, expenses incidental
to liquidation including any surety bond that may be required; second, any liability due nonmembers; third, deposits
and savings club accounts as provided in this chapter. Assets then remaining shall be distributed to the members
proportionately to the shares held by each member as of the date liquidation was voted. As soon as the governing
body or the liquidating agent determines that all assets from which there is a reasonable expectancy of realization
have been liquidated and distributed as set forth in this section, it shall execute a certificate of liquidation on a form
prescribed by the Commissioner and file it with the Secretary of State. The certificate shall, after filing or recording
and indexing, be forwarded to the Commissioner whereupon the credit union shall be dissolved.
(e) NCUA as liquidating agent. In the case in which the administrator of the National Credit Union Administration is
appointed liquidating agent, the Administrator shall have the right to be subrogated to the rights of the members of
the liquidating credit union.
Virginia § 6.2-1345. Voluntary dissolution.
A. A credit union may dissolve in accordance with the provisions of Article 13 (§ 13.1-902 et seq.) of Chapter 10 of Title
13.1. Within 10 days after the board of directors votes to recommend dissolution to the members, the board shall notify
the Commissioner and the insuring organization of that fact in writing, setting forth the reasons for the proposed
dissolution.
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B. The dissolving credit union shall also (i) notify the Commissioner of the result when the members have voted on the
proposal to dissolve and (ii) file with the Commissioner a copy of the certificate of dissolution and the certificate of
termination of corporate existence of the credit union within 10 days of the issuance of each.
Washington RCW 31.12.474 Liquidation— Disposition of unclaimed funds.
(1) At a special meeting called for the purpose of liquidation, and upon the recommendation of at least two-thirds of the
total members of the board of a credit union, the members of a credit union may elect to liquidate the credit union by
a two-thirds majority vote of those members voting.
(2) Upon a vote to liquidate under subsection (1) of this section, a three-person liquidating committee must be elected to
liquidate the assets of the credit union. The committee shall act in accordance with any requirements of the director
and may be reasonably compensated by the board of the credit union. Each share account holder and depositor at
the credit union is entitled to his, her, or its proportionate part of the assets in liquidation after all shares, deposits, and
debts have been paid. The proportionate allocation shall be based on account balances as of a date determined by
the board. For the purposes of liquidation, shares and deposits are equivalent. The assets of the liquidating credit union
are not subject to contingent liabilities. Upon distribution of the assets, the credit union ceases to exist except for the
purpose of discharging existing liabilities and obligations.
(3) Funds representing unclaimed dividends in liquidation and remaining in the hands of the liquidating committee for six
months after the date of the final dividend must be deposited, together with all the books and papers of the credit
union, with the director. The director may, one year after receipt, destroy such records, books, and papers as, in the
director's judgment, are obsolete or unnecessary for future reference. The funds may be deposited in one or more
financial institutions to the credit of the director, in trust for the members of the credit union entitled to the funds. The
director may pay a portion of the funds to a person upon receipt of satisfactory evidence that the person is entitled to
the funds. In case of doubt or conflicting claims, the director may require an order of the superior court of the county
in which the principal place of business of the credit union was located, authorizing and directing the payment of the
funds. The director may apply the interest earned by the funds toward defraying the expenses incurred in the holding
and paying of the funds. Five years after the receipt of the funds, the funds still remaining with the director must be
remitted to the state as unclaimed property.
West Virginia §31C-10-1. Voluntary liquidation.
(a) A credit union may elect to dissolve voluntarily and liquidate its affairs in the manner prescribed in this section.
(b) If it decides to begin the procedure, the board of directors shall adopt a resolution recommending the credit union be
dissolved voluntarily, and directing that the question of liquidation be submitted to the members.
(c) Within ten days after the board of directors decides to submit the question of liquidation to the members, the
president shall notify the commissioner and the insuring organization in writing, setting forth the reasons for the
proposed liquidation. Within ten days after the members act on the question of liquidation, the president shall notify
the commissioner and the insuring organization in writing as to the action of the members on the proposal.
(d) As soon as the board of directors decides to submit the question of liquidation to the members, payments on,
withdrawal of, and making any transfer of share and deposit accounts to loans and interest, making investments of
any kind, and granting loans may be restricted or suspended pending action by members on the proposal to
liquidate. On approval by the members of such proposal, all such business transactions shall be permanently
discontinued. Necessary expenses of operation shall, however, continue to be paid on authorization of the board of
directors or liquidating agent during the period of liquidation.
(e) For a credit union to enter voluntary liquidation, approval by a majority of the members in writing or by a two-thirds
majority of the members present at a regular or special meeting of the members is required. When authorization for
liquidation is to be obtained at a meeting of the members, notice in writing shall be given to each member, by first
class mail, at least ten days prior to such meeting.
(f) A liquidating credit union shall continue in existence for the purpose of discharging its debts, collecting on loans and
distributing its assets, and doing all acts required in order to wind up its business and may sue and be sued for the
purpose of enforcing such debts and obligations until its affairs are fully concluded.
(g) The board of directors or the liquidating agent shall distribute the assets of the credit union or the proceeds of any
disposition of the assets in the sequence described in subsection (f), section four, article one of this chapter.
(h) As soon as the board of directors or the liquidating agent determines that all assets from which there is a reasonable
expectancy of realization have been liquidated and distributed as set forth in this section, a certificate of dissolution
shall be executed on a form prescribed by the commissioner and filed with the Secretary of State, which shall after
filing and indexing same, be forwarded to the commissioner, whereupon such credit union shall be dissolved. The
liquidating agent shall return all pertinent books and records of the liquidating credit union to the commissioner.
Wisconsin § 186.18 Dissolution.
Upon a two-thirds recommendation of the board of directors, the members may vote to dissolve the credit union. If a
32
majority of the total membership vote by ballot, in person or by letter or other written communication in favor of
dissolution, and if not more than the greater of 15 members or 10% of the total membership, by written notice, vote
against dissolution, the credit union shall be dissolved. If both the number of votes in favor of dissolution and the number
of votes against dissolution are each less than 25 percent of the total number of members, the board of directors may,
with the permission of the office of credit unions, mail to each member at the member's last-known address a written
notice which states that the board's proposal to dissolve the credit union will be approved or disapproved at a special or
annual meeting to be held at the time and place specified in the notice. The credit union shall be dissolved only if a
majority of the members present at the meeting vote in favor of the board's proposal to dissolve the credit union. If the
members vote to dissolve the credit union, a committee of 3 shall be elected by the members to liquidate the assets of
the credit union. After assets are liquidated and debts paid, members shall be paid a liquidating dividend in proportion to
their savings from remaining assets. The committee in charge of liquidation may sell or dispose of the assets in whole or in
part at a public or private sale subject to confirmation by the board of directors and the office of credit unions.
§ 186.315 Charter cancellation.
Upon completion of a voluntary liquidation as provided in s. 186.18, or upon completion of the liquidation in cases under s.
186.235 (11), or after the assets and liabilities of a credit union are transferred to another credit union for the purpose of
merger as provided in s. 186.31 (3), the office of credit unions shall cancel the charter of the credit union liquidated or
merged without any other or further notice to the credit union or to any person. A certified copy of the order or certificate
of the office of credit unions shall be recorded with the register of deeds of the county in which the credit union is
located. The register of deeds shall note on the margin of the record of the articles of incorporation of the credit union the
volume and page where the order or certificate canceling its charter is recorded. In case of voluntary liquidation under s.
186.18 or merger under s. 186.31, the credit union shall record the order or certificate of the office of credit unions and
pay the fee. In case of liquidation under s. 186.235 (11), the office of credit unions or special deputy shall record the order
or certificate of the office of credit unions and pay the fee out of the assets of the credit union as an expense of
liquidation.
33
Comparative Digest of Credit Union Acts*: Change in Corporate Status
Provisions from State Credit Union Acts
Voluntary Merger of Credit Unions
*There are 47 state credit union acts. Delaware, South Dakota, and Wyoming do not have a state credit union act.
2015 Model Credit Union Act
Section 9.20. Voluntary Merger of Credit Unions.
(1) A credit union organized under this Act may, with the approval of the Commissioner, merge with one or more other
credit unions, Foreign Credit Unions or Federal Credit Unions, regardless of whether the credit unions serve the same
field of membership.
(2) When a credit union merges with one or more credit unions, Foreign Credit Unions or Federal Credit Unions, they shall
either designate one of them as the continuing credit union, or they shall structure a new credit union and designate
it as the new credit union. All participating credit unions other than the continuing or new credit union shall be
designated as merging credit unions.
(3) Any merger of credit unions shall follow a merger plan. After approval by a majority of the directors of all participating
credit unions, the plan shall be submitted to the appropriate regulatory authorities for preliminary approval. If the
plan includes the creation of a new credit union, all documents required by this Act shall be submitted as part of the
plan. In addition, each participating credit union except the continuing credit union shall submit the following:
(a) The time and place of the meeting of the board of directors at which the plan was agreed upon;
(b) The vote of the directors in favor of the adoption of the plan; and
(c) A copy of the resolution or other action by which the plan was agreed upon.
ALTERNATIVE #143
(4) Each merging credit union shall conduct a membership vote on its participation in the plan. Members shall be
provided at least ten days, but no more than thirty days, prior written notice of the meeting, with such notice stating the
purpose of the meeting. The vote shall be conducted at either a special membership meeting called for that purpose,
by mail ballot, or by electronic means. If a majority of the members voting approve the plan, the credit union shall
submit a record of that fact to the Commissioner indicating the vote by which the members approved the plan, and
submitting copies of notices provided to members including copies of the membership meeting notice and mail or
electronic ballot if the vote was conducted by mail or electronic means.
ALTERNATIVE #2
(4) Both the merging and continuing credit unions shall conduct membership votes on their participation in the plan.
Members shall be provided at least ten days, but no more than thirty days, prior written notice of the meeting, with
such notice stating the purpose of the meeting. The votes shall be conducted at either a special membership meeting
called for that purpose, by mail ballot, or by electronic means. If a majority of the members voting approve the plan,
the credit union shall submit a record of that fact to the Commissioner indicating the vote by which the members
approved the plan, and submitting copies of notices provided to members including copies of the membership
meeting notice and mail or electronic ballot if the vote was conducted by mail or electronic means.
(5) The Commissioner shall approve the merger plan after determining that the requirements of subsection (4) have been
met. If the merger plan includes the creation of a new credit union, the Commissioner must approve the organization
of the new credit union under Article 2 of this Act. The Commissioner shall notify all participating credit unions of the
commission’s action on the plan.
(6) Upon approval of the plan by the Commissioner, each merging credit union shall cease operations. All property,
property rights, and members’ interests in each merging credit union shall vest in the continuing or new credit union as
applicable without deed, endorsement, or other instrument of transfer, and all debts, obligations, and liabilities of
each merging credit union shall be deemed to have been assumed by the continuing or new credit union. The rights
and privileges of the members of each merging credit union shall remain intact; however, if a person is a member of
more than one of the participating credit unions, that person shall be entitled to only a one set of membership rights in
the continuing or new credit union.
(7) If the continuing or new credit union is chartered by another state or territory of the United States, it shall be subject to
the requirements of Section 2.80.
43 Alternative #1 allows the surviving credit union to avoid the expense of an unnecessary vote.
34
Comparative Digest of Credit Union Acts*: Change in Corporate Status
Provisions from State Credit Union Acts
Voluntary Merger of Credit Unions
*There are 47 state credit union acts. Delaware, South Dakota, and Wyoming do not have a state credit union act.
Alabama
§ 5‐17‐22. Merger and conversion procedures.
Any credit union may, with the approval of the administrator of the Alabama Credit Union Administration, merge with
another credit union, under the existing certificate of organization of the other credit union, pursuant to any plan agreed
upon by the majority of each board of directors of each credit union joining in the merger. In addition to approval by
the administrator and each board of directors, the membership of the merging credit union must also approve the
merger plan in the following manner:
(1) At a meeting called for that purpose (notice of which purpose must be contained in the call) two thirds of those in
attendance may vote to approve the merger plan. Notice of the meeting must have been mailed to the last known
address of each member of the credit union at least 15 days prior to the date of the meeting.
(2) After agreement by the directors and approval by the members of the merging credit union, the president and
secretary of the credit union shall execute a certificate of merger which shall set forth all of the following:
a. The time and place of the meeting of the board of directors at which the plan was agreed upon;
b. The vote in favor of the adoption of the plan;
c. A copy of the resolution or other action by which the plan was agreed upon.
d. The time and place of the meeting of the members at which the plan agreed upon was approved; and
e. The vote by which the plan was approved by the members.
(3) Such certificate and a copy of the plan of merger agreed upon shall be forwarded to the administrator, certified by
the administrator, and returned to both credit unions within 30 days.
(4) Upon return of the certificate from the administrator, all property, property rights and members' interest of the deed,
endorsement or other instrument of transfer, and all debts, obligations, and liabilities of the merged credit union shall
be deemed to have been assumed by the surviving credit union under whose charter the merger was effected. The
rights and privileges of the members of the merged credit union shall remain intact.
(5) A copy of the certificate approved by the Administrator of the Alabama Credit Union Administration shall be filed with
the judge of probate of the county in which each credit union's certificate of organization is recorded.
(6) This section applies to credit unions organized under the laws of the State of Alabama. Federally chartered credit
unions may be merged into Alabama organized credit unions, under the same conditions as Alabama credit unions;
provided, that the merger plan is approved by the National Credit Union Administration or private insurance program
or carrier.
(7) Credit unions organized under the laws of the State of Alabama may be merged into federally chartered credit unions
under the same conditions as provided in this section; provided, that the merger plan is approved by the National
Credit Union Administration or private insurance program or carrier.
Alaska Sec. 06.45.280. Merger.
(a) A credit union may merge with another credit union under a plan agreed upon by a majority of the board of directors
of each credit union and approved by a majority of the members of each credit union present at meetings called to
approve the plan.
(b) The commissioner may by regulation establish further procedures governing mergers.
Arizona § 6-587. Merger or consolidation of credit unions.
A. Any two or more credit unions may merge or consolidate into a single credit union. The merger or consolidation may
be with a credit union organized under the laws of this state, the laws of any other state or territory of the United States
or the laws of the United States.
B. If two or more credit unions merge, they shall either designate one of them as the continuing credit union or they shall
structure a totally new credit union and designate it as the new credit union. All participating credit unions other than
the continuing or new credit union shall be designated as merging credit unions.
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C. Any merger of credit unions shall be done according to a plan of merger. After approval by the boards of directors of
all participating credit unions, the plan shall be submitted to the superintendent for preliminary approval. If the plan
includes the creation of a new credit union, all documents required by section 6-506 shall be submitted as part of the
plan. In addition, each participating credit union shall submit the following:
1. The time and place of the meeting of the board of directors at which the plan was agreed on.
2. The vote of the directors in favor of the adoption of the plan.
3. A copy of the resolution or other action by which the plan was agreed on.
D. The superintendent shall grant preliminary approval if the plan has been approved properly by each board of
directors, if the documentation required to form a new credit union, if any, complies with section 6-506 and if the
superintendent is of the opinion that the merged or continuing credit union should be approved.
E. After the superintendent grants preliminary approval, each merging credit union shall conduct a membership vote on
its participation in the plan. The credit union shall conduct the vote either at a special membership meeting called for
that purpose or by mail ballot. If a majority of the members voting approves the plan, the credit union shall submit a
record of that fact to the superintendent indicating the vote by which the members approved the plan and either the
time and place of the membership meeting or the mailing date and closing date of the mail ballot.
F. The superintendent shall grant final approval of the plan of merger after determining that the requirements of
subsection E of this section in the case of each merging credit union have been met and if proof of insurance of
accounts, as required by section 6-558, has been furnished. The superintendent shall notify all participating credit
unions of his action on the plan. If approved, the continuing credit union shall file copies of the certificate showing the
approval of the superintendent with the corporation commission and a certified copy of the filing under the seal of the
commission recorded with the county recorder of the county in which each credit union participating in the merger
has its principal place of business with a copy filed with the superintendent. When the copies have been filed the
merged credit union terminates as a legal entity, and the continuing credit union remains and continues in operation.
G. On final approval of the plan by the superintendent, all property, property rights and members' interests in each
merging credit union vest in the continuing or new credit union as applicable without deed, endorsement or other
instrument of transfer, and all debts, obligations and liabilities of each merging credit union are deemed to have been
assumed by the continuing or new credit union. The rights and privileges of the members of each participating credit
union remain intact, except that if a person is a member of more than one of the participating credit unions that
person is entitled to only a single set of membership rights in the continuing or new credit union.
H. If the continuing or new credit union is chartered by another state or territory of the United States, it is subject to the
requirements of section 6-511.
I. Notwithstanding any other law, the superintendent may authorize a merger or consolidation of a credit union which is
insolvent or is in danger of insolvency with any other credit union or may authorize a credit union to purchase any of
the assets or assume any of the liabilities of any other credit union which is insolvent or in danger of insolvency if the
superintendent is satisfied that:
1. An emergency requiring expeditious action exists with respect to the other credit union.
2. Other alternatives are not reasonably available.
3. The public interest would best be served by approval of the merger, consolidation, purchase or assumption.
Arkansas § 23-35-701. Merger.
(a) Any credit union other than a central credit union may, with the approval of the State Credit Union Supervisor, merge
with any other credit union under the existing charter of the other credit union, pursuant to any plan agreed upon by
the majority of the board of directors of each credit union joining in the merger and approved by the affirmative
vote of a majority of the members of each credit union present at the meetings of members duly called for that
purpose. The State Credit Union Supervisor may waive the common bond requirement of this chapter for merging
credit unions if he determines that good cause has been shown for waiving the requirement and that the merger is
consistent with the purposes of this chapter.
(b) (1) After agreement by the directors and approval by the members of each credit union, the president and secretary
of each credit union shall execute a certificate of merger, which shall set forth all of the following:
(A) The time and place of the meeting of the board of directors at which the plan was agreed upon;
(B) The vote in favor of adoption of the plan;
(C) A copy of the resolution or other action by which the plan was agreed upon;
(D) The time and place of the meeting of the members at which the plan agreed upon was approved;
(E) The vote by which the plan was approved by the members;
(F) Such other provisions as set by rule or order of the State Credit Union Supervisor.
(2) The certificates and a copy of the plan of merger agreed upon shall be forwarded to the State Credit Union
Supervisor and, if approved, returned to the merging credit unions.
(c)Upon any such merger so effected, all property, property rights, and interests of the merged credit union shall vest in
the surviving credit union without deed, endorsement, or other instrument of transfer. All debts, obligations, and
liabilities of the merged credit union shall be deemed to have been assumed by the surviving credit union under
whose charter the merger was effected.
(d) This section shall be construed, whenever possible, to permit a credit union chartered under any other act to merge
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with one subject to the provisions of this chapter.
California
§ 15200.
Any credit union may, with the approval of the commissioner, merge with another credit union or with a central credit
union.
§ 15201.
(a) The merger shall be made pursuant to any plan agreed upon by the majority of the board of directors of each credit
union joining in the merger, and approved by the affirmative vote of at least a majority of the members of the
disappearing credit union, in person or by proxy, at a meeting of the members called for that purpose or by written
consent of a majority of the members of the disappearing credit union. Notice of the meeting shall be given to the
members, either personally or by first-class mail, not less than 30 nor more than 90 days prior to the date of the
meeting.
(b) The commissioner may approve a merger according to the plan agreed upon by the majority of the board of directors
of each credit union, as set forth in subdivision (a), if the plan of merger is approved by less than a majority of the
membership as provided in subdivision (a) if the commissioner finds, upon the written and verified application filed by
the board of directors, that
(1) notice of the meeting called to consider the merger or the ballot for written vote on the merger was mailed to
each member entitled to vote upon the question,
(2) the notice or ballot disclosed the purpose of the meeting or the written vote,
(3) the notice or ballot informed the membership that approval of the merger might be sought pursuant to this
section, and
(4) a majority of the votes cast upon the question were in favor of the merger.
(c) Notwithstanding subdivisions (a) and (b), the commissioner may approve a merger without a vote of the membership
of the disappearing credit union if a majority of the members of the board of directors of the surviving credit union
approves the merger, the disappearing credit union is in danger of insolvency and the merger would reduce the risk
or avoid a threatened loss to the National Credit Union Share Insurance Fund or other form of share guaranty or
insurance that is acceptable to the commissioner. For purposes of this chapter, a credit union is insolvent when, from
the most recent available financial statements, it can be shown that the total amount of its shares exceeds the
present cash value of its assets after providing for liabilities unless the commissioner finds all of the following:
(1) The facts that caused the deficient share-asset ratio no longer exist.
(2) Further decline in the share-asset ratio is not probable.
(3) The return of the share-asset ratio to its normal limits within a reasonable time for the credit union concerned is
probable.
(4) The probability of a further potential loss is negligible to the National Credit Union Share Insurance Fund or other
form of share guaranty or insurance that is acceptable to the commissioner.
§ 15202.
(a) After the requirement of approval as provided in Section 15201 is satisfied, each credit union shall execute a
certificate of merger as an officers' certificate pursuant to Section 5062 of the Corporations Code that shall set forth:
(1) That the plan of merger has been approved by the board of directors.
(2) That the plan of merger has been duly approved by any required vote of the members pursuant to Section 15201.
(3) The total number of members of the credit union.
(b) A copy of the plan of merger and of the written approval thereof by the commissioner shall be annexed to the
certificate of merger.
(c) Nothing in this section requires a federal credit union to execute or file the certificate of merger called for in subdivision
(a).
§ 15203.
Each certificate of merger called for in Section 15202 shall be filed in the office of the Secretary of State. After the filing in
the office of the Secretary of State, a copy of each certificate of merger, certified by the Secretary of State, shall be filed
with the commissioner, and at that time the merger shall become effective for all purposes.
§ 15204.
(a) Upon any merger effectuated as provided in this article, all property, property rights, and interests of the merged
credit union shall vest in the surviving credit union, without deed, endorsement or other instruments of transfer, and all
debts, obligations and liabilities of the merged credit union are assumed by the surviving credit union under whose
charter the merger has been effected. Thereafter the charter of the merged credit union is void, and the existence of
the merged credit union as a legal entity separate from the surviving credit union terminates.
(b) Whenever a credit union having any real property in this state merges with another credit union and vests that real
property in the surviving credit union, the filing for record in the office of the county recorder of any county in this state
in which any of the real property of the disappearing credit union is located of the certificates of merger and requisite
attachments, as required by Section 15202, shall evidence record ownership in the surviving credit union of all interest
of the disappearing credit union in and to the real property located in that county.
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Colorado § 11-30-122. Merger.
(1) The method of merger of two or more credit unions shall be as follows:
(a) (I) The board of directors of the continuing and each merging credit union shall:
(A) Approve a plan for the proposed merger; and
(B) Authorize representatives of each credit union to act on each credit union's behalf to bring about the
merger.
(II) The plan shall include such information as the board deems appropriate.
(b) Upon approval of the merger plan by each board of directors for each credit union involved in the transaction,
the merger plan, together with the resolutions of each board of directors, shall be submitted to the board. If the
board determines that the merger plan complies with the provisions of this article and any applicable rules thereto,
the board may approve the merger plan, subject to such other specific requirements as may be prescribed to fulfill
the intended purposes of the proposed merger.
(c) A meeting of the members of each merging credit union involved shall be called for the purpose of considering a
merger. Notice of the meeting, including purpose, date, time, place, and ballot of the merger plan shall be given
to the entire membership. At such meeting, at least two-thirds of the members present and voting must approve
the proposed merger. If any member approves or disapproves the merger by returning a ballot, signed by such
member, to the secretary of the credit union at or before the meeting, such ballot for all purposes of this section
shall be deemed equivalent to the vote of such member at such meeting, notwithstanding the member is not then
present.
(2) The merger shall thereupon be consummated in the following manner:
(a) The duly authorized representatives of each credit union shall execute, in duplicate, a certificate of merger stating:
(I) That the board of directors of each credit union has approved the merger;
(II) That more than two-thirds of the members of each merging credit union have approved the terms and
conditions of the proposed merger at a meeting of the members called for that purpose; and
(III) The name and location of the continuing credit union.
(b) The continuing credit union shall prepare and adopt any bylaw amendments required by the board, consistent
with the provisions of this article, and execute the same in duplicate.
(c) The certificate above provided for and any required bylaw amendments, both executed in duplicate, shall be
forwarded to the board.
(3) (Deleted by amendment, L. 2004, p. 133, § 10, effective July 1, 2004.)
(4) If the board approves the certificate and bylaw amendments, it shall so notify the representatives and shall issue a
certificate of approval, attach it to the duplicate certificate of merger, and return the same to the representatives of
the participating credit unions together with the duplicate of the bylaw amendments.
(5) The duplicate of the certificate of merger with the board's certificate of approval attached shall be filed with the
secretary of state who shall make a record of said certificate and return it, with his certificate of record attached, to
the board for permanent record. The fee for said filing shall be determined and collected pursuant to section 24-21-104
(3), C.R.S.
(6) Thereupon the participating credit unions shall be merged in accordance with the provisions of this section. The
continuing credit union shall take over the assets and assume all the liabilities of each merging credit union.
(7) A state chartered credit union may merge with a federal credit union provided all requirements outlined in this article
and the appropriate federal credit union regulations have been complied with and approval of such proposed
merger has been authorized by the board of directors of each credit union involved.
Connecticut Sec. 36a-468a. Mergers.
(a) With the approval of the commissioner, a Connecticut credit union may merge with a Connecticut credit union, a
federal credit union or an out-of-state credit union in accordance with the requirements of this section. In the case of
a merger with an out-of-state state-chartered credit union where the resulting institution is the out-of-state state-
chartered credit union, the commissioner may not approve such merger unless such out-of-state credit union
maintains share insurance as required by the Federal Credit Union Act and the laws of the chartering state of such
credit union authorize, under conditions no more restrictive than those imposed by the laws of this state as determined
by the commissioner, a Connecticut credit union to merge with a credit union chartered in that state. Any federal
credit union or out-of-state federally-chartered credit union proposing to merge with a Connecticut credit union shall
comply with all federal laws to effect the merger and shall file proof of such compliance with the commissioner and
any additional information that the commissioner may require. Any out-of-state state-chartered credit union proposing
to merge with a Connecticut credit union shall comply with all laws of its chartering state to effect the merger and
shall file proof of such compliance with the commissioner and any additional information that the commissioner may
require.
(1) The governing boards of the credit unions proposing to merge shall (A) adopt by majority vote a plan of merger,
which shall set forth the name of each credit union proposing to merge and that of the resulting credit union, and
the terms and conditions of the proposed merger, including the proposed field of membership of the resulting
credit union; (B) enter into a merger agreement; (C) file with the commissioner an application in accordance with
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subdivision (2) of this subsection; and (D) in the case of a terminating Connecticut credit union, submit the plan of
merger to its members in accordance with subdivision (3) of this subsection.
(2) The credit unions proposing to merge shall file an application with the commissioner. Such application shall
include (A) the plan of merger and a copy of the minutes of each of the governing boards adopting the plan of
merger; (B) the merger agreement; (C) an original proposed certificate of amendment to the resulting credit
union’s certificate of incorporation and proposed amended bylaws, if applicable; (D) financial statements of the
merging credit unions and a pro forma financial statement of the resulting institution; (E) in the case of a
terminating Connecticut credit union, a proposed written notice to its members of the date, time and place of
the meeting at which its members shall vote on the plan of merger and a proposed form of any ballot and proxy;
(F) information addressing the considerations required under subsection (b) of this section; and (G) such
additional information as the commissioner may require.
(3) A terminating Connecticut credit union shall give written notice of the date, time and place of the meeting at
which its members shall vote on the plan of merger. Such notice shall state that the purpose of the meeting is to
consider the plan of merger and contain or be accompanied by a copy or summary of the plan. The notice shall
be hand-delivered or mailed to each member at such member’s last-known address as shown on the records of
the credit union not less than thirty or more than fifty days prior to the date of the meeting. Unless waived by the
commissioner in accordance with subdivision (2) of subsection (b) of this section, the affirmative vote of two-thirds
of the members of the terminating Connecticut credit union voting on the plan of merger shall be required for
approval of the merger. The terminating Connecticut credit union shall file with the commissioner a verified
statement that the merger has been duly noticed and approved by its members in accordance with this
subdivision.
(b) (1) The commissioner shall not approve a merger pursuant to this section unless the commissioner considers whether (A)
the merging credit unions have engaged in any unsafe or unsound practice during the one-year period preceding
the date on which the merger application is filed with the commissioner; (B) the resulting credit union will be
adequately capitalized; (C) the resulting credit union will have the managerial capability and the financial
resources to serve the proposed membership; (D) the proposed merger will substantially lessen competition in the
Connecticut credit union industry; (E) the proposed merger will have a beneficial effect in meeting the
convenience and needs of the proposed membership; and (F) the programs, policies and procedures of the
merging credit unions or the resulting credit union relating to anti-money-laundering activity are adequate, and the
merging credit unions have a record of compliance with anti-money-laundering laws and regulations.
(2) The commissioner may approve a merger pursuant to this section without regard to field of membership or may
waive the membership vote if the commissioner certifies in writing that based on the information available to the
commissioner, one or more of the Connecticut credit unions proposing to merge are or will be in a doubtful or failing
financial condition, other alternatives to the merger are not reasonably available to protect the credit unions’
members and creditors, or an emergency requiring expeditious action exists, which certification shall be attached to
the commissioner’s approval.
(3) If the commissioner is satisfied that the requirements of this chapter have been complied with, the commissioner
shall issue an approval of the merger, which approval may contain such terms and conditions as the commissioner
deems necessary or appropriate. After approval of the merger by the commissioner, the resulting credit union shall
file a copy of the merger agreement, the plan of merger, the certificate of amendment to its certificate of
incorporation, if any, and the commissioner’s approval in the office of the Secretary of the State. Within ten days
after such documents are filed with the Secretary of the State, the resulting credit union shall file with the
commissioner copies of such filed documents, and in the case of a Connecticut credit union that is the resulting
credit union, a copy of its amended bylaws, if any. The merger agreement may provide for the effective date of the
proposed merger, which shall not be earlier than the filing of the agreement and the approval of the commissioner
in the office of the Secretary of the State. If the agreement does not provide for an effective date, the merger shall
become effective on the date of the filing of the agreement and approval in the office of the Secretary of the
State.
(c)Upon the effective date of the merger, (1) the corporate existence of the parties to the merger shall be continued by
and in the resulting credit union; (2) the entire assets, business, good will and franchises of each of the parties to the
merger shall be vested in the resulting credit union without any deed, endorsement or other instrument of transfer; and
(3) all of the debts, obligations and liabilities of the parties to the merger shall be assumed by the resulting credit union.
Florida § 657.065. Merger.
(1) Upon the filing of an application with the office by the constituent credit unions, and upon approval by the office,
credit unions may be merged with a surviving state credit union, as prescribed in this code, except that the action by
a merging federal credit union must be taken in the manner prescribed by, and is subject to, any limitations or
requirements imposed by federal law and regulations. The application must be accompanied by a merger plan and
agreement together with a certified copy of the authorizing resolutions of the board of directors of constituent credit
unions showing approval by a majority of the entire board of directors of each credit union, as provided in this section,
and a nonrefundable application fee of $500. The fee may be waived by the office for a merger under subsection (6).
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(2) Nothing in the law of this state shall restrict the right of a state credit union to merge with a surviving federal credit
union. In such case, the action to be taken by a merging state credit union, and its rights and liabilities and those of its
members, shall be the same as those prescribed for merging federal credit unions at the time of the action by
applicable federal law or regulations.
(3) If the resulting credit union will be a state credit union, the merging credit unions shall adopt a merger plan and
agreement stating the method, terms, and conditions of the merger, including all agreements concerning the merger.
The board of directors of each constituent credit union must, by majority vote of the entire board, approve the merger
plan and agreement, which shall contain:
(a) The name and address of the merging and surviving credit unions;
(b) The date, time, and place of the meeting where the merger plan and agreement was approved by the merging
and the surviving credit unions’ boards of directors;
(c) The name and address of the main office of the surviving credit union and each continuing branch office;
(d) The names, terms, and board positions of the surviving credit union’s board of directors;
(e) The name and title of each executive officer;
(f) A list of any needed amendments to the surviving credit union’s bylaws, if applicable, and, attached to the
agreement, copies of the amendments;
(g) A statement that the merger and the merger plan and agreement are subject to approval by the office and the
National Credit Union Administration; and
(h) Such additional provisions not contrary to law as are agreed upon by the constituent credit unions and such other
provisions as the office requires to enable it to discharge its duties with respect to the merger.
(4) The office shall approve the application and the merger plan and agreement if it finds that:
(a) The surviving credit union’s net worth is adequate; and
(b) The merger will not impair the ongoing viability of the surviving credit union.
If the office disapproves a merger plan and agreement, it shall state its objections and, chapter 120 notwithstanding,
give an opportunity to the merging and surviving credit unions to amend the merger plan and agreement to eliminate
such objections.
(5) Approval by the office, by final order or otherwise, of the application and merger plan and agreement shall be
deemed subject to approval by the membership of the merging credit union who vote on the merger at a meeting
duly called for that purpose. Such approval shall be documented by the submission of a copy of:
(a) The notice of intent to merge given to the surviving credit union;
(b) The notice to the members of the merging credit union of the meeting duly called to consider the merger. Such
notice must disclose the purpose of the meeting and the date, time, and place of the meeting; and
(c) The resolution adopted by the membership confirming the vote on the merger.
Unless the approval of the merging credit union has been obtained and proper evidence thereof submitted to the
office within 6 months after the approval by the office, the approval by the office of the merger and merger plan
and agreement shall be deemed to be revoked and terminated; however, the office on its own motion, or at the
request of the merging or surviving credit unions for good cause shown, may extend the time for a period not to
exceed 6 months.
(6) Notwithstanding any other provision of this chapter or of chapter 120, a credit union may merge without the vote of
the membership when the office determines that the credit union is in danger of insolvency or that the credit union is
significantly undercapitalized, as defined in s. 216, the Federal Credit Union Act, codified at 12 U.S.C. s. 1790d and the
merger will enable the credit union to avoid liquidation.
(7) A merger with a resulting state credit union may not take place or be effective unless approved by the National
Credit Union Administration and the office issues a certificate of merger. Upon consummation of the merger, the
certificate of authorization of the merged credit union shall be returned to the proper authority to be canceled. Also,
at consummation, all property and property rights of, and members’ interest in, the merged credit union shall vest in
the surviving credit union without deed, endorsement, or other instrument of transfer, and all debts, obligations, and
liabilities of the merged credit union must be assumed by the surviving credit union under the certificate of
authorization under which the merger was affected. All members of the surviving credit union have the same rights,
privileges, and responsibilities after the merger is completed. The certificate of merger must be recorded in the public
records of all counties in which the merging credit union owned any real property at the effective date of the merger.
Georgia § 7-1-667. Mergers.
(a) A credit union may, with the approval of the department and in accordance with such uniform rules and regulations
as it shall make and promulgate, be merged with another credit union under the articles of such credit union. Such
merger may occur regardless of whether the credit unions serve the same field of membership, so long as there is
adopted a plan agreed upon by the majority of the board of each credit union joining the merger and approved by
not less than a majority of the members of the credit union being acquired present and eligible to vote at the meeting
called for that purpose. The department may allow waiver of the member vote if, in its judgment, the merger is
necessary to protect the safety and soundness of either or both credit unions. All property, property rights, and
interests of the merging credit union shall, upon merger, be transferred to and vested in the continuing credit union
without deed, endorsement, or other instrument of transfer; and the debts and obligations of the merging credit union
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shall be deemed to have been assumed by the continuing credit union; and thereafter the articles of the merging
credit union shall be void.
(b) The provisions of Article 8 of Chapter 4 of Title 14, relating to merger and consolidation, shall no longer be applicable
to credit unions.
(c) For purposes of this Code section, the term "credit union" shall include a federal credit union.
(d) When a credit union merges with another credit union, one shall be designated as the continuing credit union by the
credit unions participating in the merger. The participating credit union that is not the continuing credit union shall be
designated as the merging credit union.
(e) The department may disapprove of a merger if it finds the merger would not be consistent with safe and sound
practices.
(f) The department shall, in its discretion, approve or disapprove a merger on the basis of its investigation and the criteria
set forth in subsections (a) and (e) of this Code section. The department shall give written notice to:
(1) The Secretary of State of its approval of a merger along with a copy of the notice of merger; and
(2) The parties to the plan of its decision and, in the event of disapproval, a statement in general of the reasons for its
decision.
(g) The rights and privileges of the members of each merging credit union shall remain intact, provided that, if any person
is a member of more than one of the participating credit unions, such person shall only be entitled to one set of
membership rights in the continuing credit union.
Hawaii §412:3-609 Merger or consolidation of Hawaii financial institutions.
(a) Any one or more financial institutions may merge into another financial institution and any two or more financial
institutions other than credit unions may consolidate into a new financial institution if the institutions shall have complied
with all requirements, conditions, and limitations imposed by this chapter and by federal law, if applicable. A merger
or consolidation in which one or more of the participating financial institutions is a financial institution chartered or
licensed under the laws of or whose operations are conducted principally in any state other than Hawaii, in any
possession or territory of the United States or in any foreign country shall be authorized only in accordance with
subsection (d), in accordance with part IV, article 5, of this chapter or in accordance with article 12.
(b) Any merger or consolidation of Hawaii stock financial institutions shall be effected pursuant to the procedures,
conditions, and requirements for, and with the effect of, the merger or consolidation of two or more corporations
pursuant to chapter 414; except that the vote by the shareholders of each of the participating institutions to approve
the plan of merger or consolidation shall satisfy the requirements of section 412:3-604 and that the director of
commerce and consumer affairs shall not file the articles of merger or consolidation until the plan of merger or
consolidation shall have been approved by the commissioner in writing.
(c)One or more federal financial institutions whose operations are conducted principally in this State and one or more
Hawaii financial institutions may be merged or consolidated, with the federal financial institution, the Hawaii financial
institution, or a new consolidated financial institution being the resulting institution, if the merger or consolidation is
permitted by federal law. The federal financial institution shall comply with all requirements, conditions, and limitations
imposed by federal law or regulation with respect to the merger or consolidation. The Hawaii financial institution shall
comply with all of the provisions of this chapter and chapter 414, except that the vote by shareholders or members of
the Hawaii financial institution to approve the plan of merger or consolidation shall satisfy the requirements of section
412:3-604. The resulting financial institution shall file with the director of commerce and consumer affairs a confirmation
in writing by the commissioner of the date and time of the merger or consolidation, together with the appropriate filing
fee pursuant to chapter 414.
(d) One or more financial institutions chartered or licensed under the laws of or whose operations are conducted
principally in any state other than this State, in any possession or territory of the United States, or in any foreign country
and one or more Hawaii depository financial institutions or trust companies may be merged or consolidated, but only
where the depository financial institution or trust company resulting from any merger or consolidation pursuant to this
subsection is chartered or licensed under the laws of and conducts its operations principally in this State, is a federal
financial institution that conducts its operations principally in this State, or is an out-of-state bank authorized to establish
interstate branches in this State pursuant to section 412:12-104. A nondepository financial services loan company
licensed pursuant to article 9 may be merged or consolidated with another corporation, but only where the
nondepository financial institution resulting from any merger or consolidation is licensed under the laws of this State.
The financial institution chartered or licensed under the laws of any state other than this State, any possession or
territory of the United States, or any foreign country shall comply with all requirements, conditions, and limitations
imposed by the law of the jurisdiction under which the financial institution is chartered or licensed with respect to the
merger or consolidation. The Hawaii financial institution shall comply with all of the provisions of this chapter and
chapter 414, except that the vote by shareholders or members of the Hawaii financial institution to approve the plan
of merger or consolidation shall satisfy the requirements of section 412:3-604. If the resulting institution is a Hawaii
financial institution, the director of commerce and consumer affairs shall not file articles of merger or consolidation
until the plan of merger or consolidation shall have been approved by the commissioner in writing. If the resulting
institution is a federal financial institution, the director of commerce and consumer affairs shall not file the articles of
merger or consolidation until the plan of merger or consolidation shall have been approved by the commissioner in
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writing and the resulting federal financial institution shall file with the director of commerce and consumer affairs a
confirmation in writing by the commissioner of the date and time of the merger or consolidation, together with the
appropriate filing fee pursuant to chapter 414.
(e) A Hawaii credit union may merge with a Hawaii credit union or federal credit union. The merger shall be effected
pursuant to the procedures, conditions, and requirements for, and with the effect of, the merger of two or more stock
financial institutions pursuant to this section and to chapter 414, as though the credit unions were stock financial
institutions; except that the plan of merger shall be approved by a majority of the members of the board of directors
of each participating credit union and by the members of the participating credit unions at a meeting duly called
and noticed and upon a vote that satisfies the requirements of sections 412:3-604 and 412:3-605.
(f) Prior to or after the vote of the shareholders or members upon the plan of merger or consolidation, but prior to delivery
of articles of merger or consolidation and plan of merger or consolidation to the director of commerce and consumer
affairs, the participating financial institutions shall file an application with the commissioner pursuant to section 412:3-
603 for approval of the proposed merger or consolidation. The application shall be accompanied by:
(1) The plan of merger or consolidation;
(2) A certificate signed by two executive officers of each of the participating institutions, verifying that the plan of
merger or consolidation has been approved by the board of directors of each participating financial institution
and that the attached copy of the resolution approving the proposed merger or consolidation is true and correct;
(3) If any participating financial institution is a federal financial institution or a financial institution chartered or licensed
under the laws of any state other than this State, any possession or territory of the United States, or any foreign
country, a certificate signed by two executive officers verifying that the financial institution has complied, or will
comply, with all federal laws and regulations or all laws and regulations of the jurisdiction under which it is
chartered or licensed relating to the merger or consolidation;
(4) If the resulting financial institution is to be a Hawaii financial institution, the information required from applicants for
approval to organize a Hawaii financial institution of the same type as the proposed resulting Hawaii financial
institution;
(5) If a Hawaii financial institution is seeking to merge or consolidate with a financial institution of another type, the
information required from applicants for approval to convert to another type of financial institution; and
(6) Any other information that the commissioner may require.
(g) The commissioner may require notice to be given to the public as may be deemed appropriate. The commissioner
may conduct an examination of the financial institution as provided under article 2, part II. The cost of any examination
shall be assessed against and paid by the institution pursuant to section 412:2-105.
(h) The commissioner shall approve the plan of merger or consolidation if it appears that:
(1) Any resulting Hawaii financial institution would meet all the requirements under this chapter for a charter or license
to the same extent that it would if it were applying for a new charter or license;
(2) Any resulting financial institution would be adequately capitalized;
(3) The plan of merger or consolidation is fair to creditors and the shareholders or members of all participating
institutions;
(4) The participating institutions have complied, or will comply, with all requirements, conditions, and limitations
imposed by federal laws or regulations or by the laws or regulations of the jurisdiction under which an institution is
chartered or licensed with respect to the merger or consolidation;
(5) The overall experience, moral character, or integrity of the proposed directors and executive officers of the
resulting financial institution is consistent with the interests of the depositors, beneficiaries, creditors, shareholders, or
members of the financial institution, or in the public interest;
(6) The merger or consolidation will not jeopardize the safety or soundness of any participating financial institutions or
the resulting financial institution, and is not otherwise contrary to the public interest;
(7) The merger or consolidation will not substantially lessen competition or tend to create a monopoly or restraint of
trade in any section of the country that includes this State or a part thereof, or that any anti-competitive effects
are clearly outweighed in the public interest by the probable effect of the merger or consolidation in meeting the
convenience and needs of the community to be served;
(8) The merger or consolidation will promote the convenience, needs, and advantage of the general public
particularly in the communities in which the participating and resulting financial institutions conduct or will conduct
their business;
(9) The grounds for approval of a conversion to another type of financial institution pursuant to section 412:3-608 have
been met in the case of a participating Hawaii financial institution seeking to merge or consolidate with a financial
institution of a different type; and
(10) The plan meets any other criteria as the commissioner may deem appropriate.
(i) In the case of a merger, the charter or license of the participating depository financial institution or trust
company that is the resulting institution shall continue as the charter or license of the resulting depository
financial institution or trust company upon the effective date of the merger. In the case of a consolidation, when
the commissioner is satisfied that the participating depository financial institutions or trust companies have
complied with all state and federal law with regard to the consolidation, the commissioner shall issue a charter
or license to the consolidated resulting Hawaii depository financial institution or trust company. A nondepository
financial services loan company license may be issued to the resulting financial institution in conjunction with a
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merger or consolidation upon compliance with all applicable laws regarding the issuance of a license to a
nondepository financial services loan company.
Idaho § 26-2132. Merger.
Any credit union may, with the approval of the director, merge with another credit union under the existing charter of
such other credit union. The director shall not approve a merger if the effect of the merger would be to provide a broader
common bond than allowable under section 26-2110, Idaho Code. The merger may be based upon any plan agreed to
by the majority of the board of directors of each credit union joining in the merger, and approved by the affirmative vote
of the majority of the members of each such credit union at meetings of the members called for such purpose. Any
member not present at the meeting may, within the next twenty (20) days, vote by signing a statement on a form
prescribed by the board of directors and such vote shall have as full force and effect as if cast at the meeting. If any such
member does not vote within the twenty (20) day period, he shall be deemed to be in favor of the merger. After such
agreement by the directors and approval by the members of each credit union, the president and secretary of each
credit union shall execute a certificate of merger which shall set forth at least all of the following:
(a) The time and place of the meeting of the board of directors at which the plan was agreed upon.
(b) The vote in favor of adoption of the plan.
(c) A copy of the resolution or other action by which the plan was agreed upon.
(d) The time and place of the meeting of the members at which the plan agreed upon was approved.
(e) The vote by which the plan was approved by the members.
Such certificates and a copy of the plan of the merger shall be forwarded to the director and if approved, a copy of the
certificate shall be filed with the county clerk of the county in which each credit union participating in the merger has its
principal place of business, and then filed with the director, whereupon the charter of the merged credit union as a legal
entity separate from the surviving credit union shall terminate.
Upon any such merger so affected, all property, property rights, and interests of the merged credit union, shall vest in the
surviving credit union without deed, endorsement or other instrument of transfer, and all debts, obligations and liabilities
of the merged credit union shall be deemed to have been assumed by the surviving credit union whose charter the
merger has affected.
This section shall be construed, when possible, to permit a credit union chartered under the Federal Credit Union Act to
merge with one chartered under this chapter, or to permit one chartered under this chapter to merge with one
chartered under the Federal Credit Union Act.
Illinois (205 ILCS 305/63) (from Ch. 17, par. 4464)
Sec. 63. Merger and consolidation.
(1) Any two or more credit unions, regardless of whether or not they have the same common bond, may merge or
consolidate into a single credit union. A merger or consolidation may be with a credit union organized under the laws
of this State or of another state or of the United States and is subject to the approval of the Secretary. It must be made
on such terms as have been agreed upon by a vote of a majority of the board of directors of each credit union, and
approved by an affirmative vote of a majority of the members of the merging credit union being absorbed present at
a meeting, either in person or by proxy, duly called for that purpose, except as hereinafter specified. Notice of the
meeting stating the purpose must be sent by the Secretary of each merging credit union being absorbed to each
member by mail at least 7 days before the date of the meeting.
(2) One of the merging credit unions may continue after the merger or consolidation either as a surviving credit union
retaining its identity or as a new credit union as has been agreed upon under the terms of the merger. At least 9
members of the new proposed credit union must apply to the Department for permission to organize the new credit
union. The same procedure shall be followed as provided for the organization of a new credit union.
(3) After approval by the members of the credit union which is to be absorbed by the merger or consolidation, the
chairman or president and the secretary of each credit union shall execute a certificate of merger or consolidation,
which shall set forth all of the following:
(a) The time and place of the meeting of each board of directors at which the plan was agreed upon;
(b) The vote in favor of the adoption of the plan;
(c) A copy of each resolution or other action by which the plan was agreed upon;
(d) The time and place of the meeting of the members of the absorbed credit union at which the plan agreed upon
was approved; and,
(e) The vote by which the plan was approved by the members of the absorbed credit union.
(4) Such certificate and a copy of the plan of merger or consolidation agreed upon shall be mailed to the Secretary for
review. If the provisions of this Act have been complied with, the certificate shall be approved by him, and returned to
the credit unions which are parties to the merger or consolidation within 30 days. When so approved by the Secretary
the certificate shall constitute the Department's certificate of approval of the merger or consolidation.
(5) Upon issuance of the certificate of approval, each merging credit union which was absorbed shall cease operation.
Each party to the merger shall file the certificate of approval with the Recorder or County Clerk of the county in which
the credit union has or had its principal office.
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(6) Each credit union absorbed by the merger or consolidation shall return to the Secretary the original statement of
incorporation, certificate of approval of incorporation, and the bylaws of the credit union. The surviving credit union
shall continue its operation under its existing certificate of approval, articles of incorporation, and the bylaws or if a
new credit union has been formed, under the new certificate of approval, articles of incorporation, and bylaws.
(7) All rights of membership in and any obligation or liability of any member to any credit union which is party to a
consolidation or merger are continued in the surviving or new credit union without reservation or diminution.
(8) A pending action or other judicial proceeding to which any of the consolidating or merging credit unions is a party
does not abate by reason of the consolidation or merger.
Indiana
IC 28-7-1-33 Merger of credit unions; submission of resolutions and joint agreement to department; approval or disapproval;
shareholder vote; articles of merger
(a) Except as provided in section 33.1 of this chapter, any two (2) or more credit unions may, with the approval of the
department, merge. This section authorizes the merger of a credit union organized under this chapter with a credit
union organized under any other law.
(b) The board of directors of each credit union participating in the merger must by majority vote approve a joint
agreement of merger.
(c) After the resolutions approving a joint agreement of merger have been adopted by the board of directors of each
credit union, the credit unions shall submit the resolutions and joint agreement to the department for approval. The
department may, in the department's discretion, approve or disapprove the resolution and joint agreement. In
deciding whether to approve or disapprove the resolution and joint agreement under this section, the department
shall consider the following factors:
(1) Whether the credit unions subject to the proposed transaction are operated in a safe, sound, and prudent manner.
(2) Whether the financial condition of any credit union subject to the proposed transaction will jeopardize the
financial stability of any other credit unions subject to the proposed transaction.
(3) Whether the proposed transaction will result in a credit union that has inadequate capital, unsatisfactory
management, or poor earnings prospects.
(4) Whether the proposed transaction, in the department's judgment and considering the available information under
the prevailing circumstances, will result in an institution that is more favorable to the stakeholders than if the entities
were to remain separate.
(5) Whether the management or other principals of the credit union that will result from the proposed transaction are
qualified by character and financial responsibility to control and operate in a legal and proper manner the
resulting credit union.
(6) Whether the credit unions subject to the proposed transaction furnish all the information the department requires in
reaching the department's decision.
(d) If the joint agreement is approved by the department, any credit union whose existence will terminate as a result of
the merger shall submit the joint agreement to a vote of its shareholders at the meeting directed by the resolution of
the board of directors. A majority of the shareholders present at the meeting may approve the joint agreement.
However, the department may permit the merger to become effective without the affirmative vote of the
membership of a credit union if that credit union is in danger of insolvency or if the qualified group or groups
associated with the credit union either have ceased or will soon cease to exist.
(e) After approval of the joint agreement by the shareholders of the merging credit unions, each credit union shall
execute in triplicate articles of merger, on forms furnished by the department, which shall set forth the following:
(1) The time and place of the meeting of the board of directors at which the plan was approved.
(2) The vote by which the plan was approved by the board.
(3) A copy of the resolution or other action by which the plan was agreed upon.
(4) The time and place of the meeting of the members at which the plan was approved.
(5) The vote by which the plan was approved by the members.
(f) The articles, joint agreement, and resolutions shall be delivered to the department for certification, which shall be
evidenced in the manner prescribed in IC 28-12-5, and shall be presented to the secretary of state for recording. The
secretary of state shall file one (1) copy of the articles of merger and shall issue a certificate of merger and two (2)
copies of the articles of merger to the surviving credit union. The date on which the secretary of state issues the
certificate of merger is the effective date of the merger.
(g) The articles of merger shall be filed with the county recorder of the county in which the principal office of the surviving
credit union is located.
§ 28-7-1-33.1. Merger of credit unions; surviving credit union organized under federal or other state law; department
approval not required.
The approval of the department of the merger of two (2) or more credit unions is not required under this chapter if the
credit union surviving the merger is an institution organized or reorganized under the laws of the United States or a state
(as defined in IC 28-2-17-19) other than Indiana. However, the surviving credit union shall:
(1) Notify the department of the merger;
(2) Provide satisfactory evidence to the department of compliance with the requirements of IC 28-1-22 relating to foreign
corporations, if applicable; and
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(3) Provide satisfactory evidence to the department of compliance with the requirements of section 34 of this chapter
relating to credit unions organized in other states, if applicable.
Iowa § 533.401 Merger.
1. With the approval of the superintendent, a state credit union may merge with another credit union under the existing
certificate of approval of the other credit union if the merger is pursuant to a plan agreed upon by a majority of the
board of directors of each credit union joining in the merger and the merger is approved by the affirmative vote of a
majority of the members of the merging credit union either by mail or in person at a meeting called for the purpose of
voting on the merger.
2. A plan of merger, whether by act of consolidation, acquisition, or business combination, along with evidence that the
plan has been approved by the members of the merging credit union in accordance with the provisions of this
section, shall be submitted to the superintendent, along with any additional materials the superintendent may request.
3. The superintendent may approve a merger according to the plan agreed upon by the majority of the board of directors
of each credit union if the superintendent receives a written and verified application filed by the board of directors of
each credit union and finds all of the following:
a. Notice of the meeting called to consider the merger was mailed to each member of the merging credit union
entitled to vote upon the question at least twenty days prior to the date of the merger meeting.
b. The notice disclosed the purpose of the meeting and properly informed the membership that approval of the
merger would be sought pursuant to this section.
c. At the meeting called to consider the merger, a majority of the votes received, by regular mail or in person, upon
the question were in favor of the merger.
d. Control of the merging credit union shall transfer to the board of directors of the continuing credit union upon
approval of the merger by the superintendent and the favorable vote of a majority of the members as prescribed
in paragraph “c”. Upon transfer of control, the board of directors of the merging credit union may only do such
things necessary to execute the merger.
4. The superintendent may disapprove a merger if the superintendent finds either of the following:
a. The merger would not result in a safe and sound credit union.
b. The procedures required by this section, particularly those used to obtain member approval for the merger, were not
followed or were irregular.
5. The superintendent may waive the membership merger vote if the superintendent finds that an emergency exists which
justifies the waiver.
6. The certificate of merger and a copy of the agreed plan of merger shall be forwarded to the superintendent, certified
by the superintendent, and returned to both credit unions within thirty days of the date of receipt by the superintendent.
7. a. Upon return of the certificate from the superintendent, all of the merging credit union’s property, property rights, and
members’ interests shall vest in the continuing credit union without the legal need for deeds, endorsements or other
instruments of transfer, and all debts, obligations, and liabilities of the merging credit union shall be assumed by the
continuing credit union.
b. The rights and privileges of the members of the merging credit union shall continue as provided in the plan.
c. Credit union membership in the continuing credit union shall be available to persons within the common bond of the
merging credit union.
8. This section shall be construed to permit a credit union organized under any other statute to merge with one organized
under this chapter, or to permit one organized under this chapter to merge with one organized under any other statute.
9. As used in this section, the term “merger” or “merge” means the combination of assets and liabilities of one credit union
with those of another credit union such that one credit union continues and the other credit union surrenders its charter
to operate as a credit union.
Kansas
§ 17-2228: Merger with other credit union, procedure; certificate requirements; assets and liabilities; cancellation of
terminated credit union charter.
Any credit union, with the approval of the administrator, may merge with another credit union under the charter of such
other credit union, pursuant to any plan agreed upon by the majority of the board of directors of each credit union
joining in the merger, and approved by the members of each such credit union organized under the provisions of this act,
either by the affirmative vote of a majority of those members present at a meeting of its members duly called for such
purpose or by the affirmative vote in writing of a majority of its members who participate in the vote on the merger plan
without a meeting. After such agreement by the directors and approval of the members of each credit union organized
under the provisions of this act, the president or chairperson of the board and secretary of each credit union organized
under the provisions of this act, shall execute in triplicate, a certificate of merger, which shall set forth all of the following:
(a) The time and place of the meeting of the board of directors at which the plan was agreed upon;
(b) the vote in favor of adoption of the plan;
(c) a copy of the resolution or other action by which the plan was agreed upon;
(d) the time and place of the meeting of the members at which the plan agreed upon was approved; and
(e) the vote by which the plan was approved by the members.
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Such certificates, in triplicate, a copy of the plan of merger agreed upon, and any necessary approvals or consents for a
merging credit union organized under the provisions of any other jurisdiction shall be forwarded to the administrator. Upon
receipt of these documents, the administrator shall determine whether the merger meets the statutory requirements for
field of membership set forth in K.S.A. 17- 2205, and amendments thereto. If the merger is approved, a copy of the
certificate, certified by the administrator, shall be returned to the merging credit unions within 30 days. The date of
certification of the merger by the administrator shall constitute the date of approval. Upon any such merger so effected,
all property, property rights and interest of the merged credit union shall vest in the continuing credit union without deed,
endorsement or other instrument of transfer, and all debts, obligations and liabilities of the merged credit union shall be
deemed to have been assumed by the continuing credit union under whose charter the merger was effected.
This section shall be construed, whenever possible, to permit a credit union chartered under any other act to merge with
one chartered under this act or to permit one chartered under this act to merge with one chartered under any other act.
The charter of the terminating credit union shall upon merger be canceled and voided by operation of law.
Kentucky § 286.6-710. Merger of credit union.
(1) Any credit union may, with the approval of the commissioner, merge with another credit union under the existing
charter of the other credit union, pursuant to any plan agreed upon by the majority of each board of directors of
each credit union joining in the merger, approved by the affirmative vote of a majority of the members of the
merging credit union present at a meeting of its members duly called for such purpose, and consented to by any
government agency or other organization insuring the accounts of the credit union.
(2) The commissioner may approve a merger according to the plan agreed upon by the majority of the board of
directors of each credit union if approved by less than a majority of the entire membership, as provided in this
section, if the commissioner finds upon the written and verified application filed by the board of directors that:
(a) Notice of the meeting called to consider the merger was mailed to each member entitled to vote upon the
question;
(b) Such notice disclosed the purpose of the meeting and properly informed the membership that approval of the
merger might be sought pursuant to this section; and
(c) A majority of the votes cast upon the question were in favor of the merger.
(3) After agreement by the directors and approval by the members of the merging credit union, the president and
secretary of the credit union shall execute a certificate of merger, which shall set forth all of the following:
(a) The time and place of the meeting of the board of directors at which the plan was agreed upon;
(b) The vote in favor of the adoption of the plan;
(c) A copy of the resolution or other action by which the plan was agreed upon;
(d) The time and place of the meeting of the members at which the plan agreed upon was approved; and
(e) The vote by which the plan was approved by the members.
(4) Such certificate and a copy of the plan of merger agreed upon shall be forwarded to the commissioner, certified by
him, and returned to both credit unions within thirty (30) days.
(5) Upon return of the certificate from the commissioner, all property, property rights, and members' interest of the merged
credit union shall vest in the surviving credit union without deed, endorsement or other instrument of transfer; and all
debts, obligations and liabilities of the merged credit union shall be deemed to have been assumed by the surviving
credit union under whose charter the merger was effected. The rights and privileges of the members of the merged
credit union shall remain intact.
(6) This section shall be construed, whenever possible, to permit a credit union organized under any other act to merge
with one (1) incorporated under this subtitle, or to permit any credit union incorporated under this subtitle to merge
with one (1) organized under any other act.
Louisiana
§646. Supervision by commissioner; suspension or revocation of charter; liquidation; reports; examination fees.
A.(1)(a) Credit unions are under the supervision of the commissioner. The commissioner may prescribe rules and
regulations for the administration of this Chapter and for the administration of a state share insurance
corporation, including but not by way of limitation the merger, consolidation, or dissolution of corporations
organized under this Chapter.
(b) Any central or corporate credit union chartered under this Chapter shall be subject to such rules, regulations, and
orders as the commissioner deems appropriate and, except as otherwise specifically provided in such rules,
regulations, or orders, shall be vested with or subject to the same rights, privileges, duties and restrictions,
penalties, liabilities, conditions, and limitations that would apply to all credit unions organized under this Chapter.
The commissioner may approve bylaws that he deems appropriate to a corporate or central credit union.
(2)(a) The Commissioner shall approve the merger or consolidation of credit unions organized under this Chapter or
converted from federal credit unions to a credit union under this Chapter if in conformity with this Chapter, and if
satisfied that the proposed field of membership for the merging or consolidating credit unions is favorable to the
success of the proposed merger or consolidation. The commissioner shall thereupon issue to the proposed
merging or consolidating credit unions a certificate of approval.
(b) The commissioner in granting approval to mergers, consolidations, or expansion of the field of membership shall
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give consideration to the following: locale of domicile, access to credit union facilities, and whether the proposed
merger, consolidation, or expansion of the field of membership is favorable to the success of the credit union.
(3) Repealed by Acts 2003, No. 362, §2, eff. June 18, 2003.
(4)(a) Mergers must be approved by an affirmative vote of a majority of the members of the merging credit union who
vote on the proposal and by the board of directors of the continuing credit union. Such membership vote on the
merger may be conducted by mail balloting.
(b) Written notice of any annual or special meeting of the members of the merging credit union shall be sent to
each member at the address reflected in the credit union's records at least ten days prior to such meeting.
(5) Notwithstanding the provisions of Paragraphs (2) and (3) of this Subsection, the commissioner may approve a
merger or consolidation of credit unions without membership approval when the merging credit union is insolvent,
or in danger of insolvency, as determined by the commissioner.
Maine §872. Mergers and consolidations.
1. Eligibility.
A. A credit union organized under provisions of the laws of this State, another state or federal laws may merge or
consolidate into a credit union organized under the laws of the State with the approval of the superintendent
obtained pursuant to section 252, and in accordance with such procedures as the superintendent may require.
B. If any credit union involved in the proposed merger is a federal credit union, such merger is subject to all applicable
laws, rules and regulations of the United States. A credit union involved in the proposed merger that is organized
under provisions of law of another state is subject to all applicable laws, rules and regulations of that state.
2. Plan and adoption. The merger shall be pursuant to a plan agreed upon by a majority of the board of directors of each
credit union joining in the merger; and approved by the affirmative vote of a majority of the members voting in person
or by proxy at meetings of each credit union called for that purpose or by written consent of the majority of the
members of each credit union.
3. Compliance. The superintendent shall not approve said merger unless the surviving credit union would be in
compliance with all other laws of the State regulating the organization of credit unions.
4. Effective date; certificate.
A. When the requirements as to approval have been met, including the approval of the superintendent and any
Federal agency whose approval may be required under federal law for such merger or consolidation, the
superintendent shall, issue an appropriate certificate which must be filed in all places where original organization
certificates are required to be filed in this State. In all cases, the superintendent shall cancel the charters of those
credit unions organized under the laws of this State which will cease to exist under the terms of the merger and file
notice of such action in all places where organization certificates are required to be filed in this State.
B. The merger shall become effective upon filing of the certificates pursuant to paragraph A, unless a later effective
date was set forth in the certificate.
5. Effect of merger. Upon the issuance by the superintendent of a certificate to the surviving credit union, all property
rights and interests of the merged credit union vest in the surviving credit union, without deed, endorsement or other
instruments of transfer; and all debts, obligations and liabilities of the merged credit unions are assumed by the surviving
credit union. Thereafter, the charter of any merged credit union is void, and existence of the merged credit union as a
legal entity separate from the surviving credit union terminate. Sections 357 and 358 apply to such mergers.
Maryland
§ 6-803. Merger of credit unions.
(a) Definitions. --
(1) In this section the following words have the meanings indicated.
(2) "Merging credit union" means a credit union that is absorbed or acquired by another credit union in a merger and
ceases to exist after the merger.
(3) "Surviving credit union" means a credit union that absorbs or acquires another credit union in a merger and
continues to exist after the merger.
(4) "New credit union" means a credit union that is created when two or more credit unions consolidate to form a
newly created credit union.
(b) General rule. --
(1) (i) With the approval of the Commissioner, any credit union may merge or consolidate as provided in this section.
(ii) A merger or consolidation under this section may be with a credit union organized under the laws of the United
States, this State, or any other state.
(2) (i) A single common bond credit union may merge or consolidate with another single common bond credit union
resulting in a surviving or new single common bond credit union provided that the credit unions party to the merger
or consolidation share the same single common bond, as defined under § 6- 301(c)(2) of this title, prior and
subsequent to the merger or consolidation.
(ii) A single common bond credit union may merge or consolidate with another single common bond credit union
resulting in a surviving or new multiple common bond credit union provided that:
1. Prior to the merger or consolidation, one of the credit unions converts into a multiple common bond credit
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union, as provided under § 6-304 of this title, which includes in its field of membership the group served by the
other single common bond credit union; and
2. The surviving or new multiple common bond credit union satisfies the requirements for multiple common
bonds under § 6-301(c)(3) and (e) of this title.
(3) A single common bond credit union may merge or consolidate with a multiple common bond credit union
resulting in a surviving or new multiple common bond credit union provided that:
(i) Prior to the merger or consolidation, the multiple common bond credit union includes or adds to its field of
membership the group served by the single common bond credit union, as provided under § 6- 303 of this title;
and
(ii) The surviving or new multiple common bond credit union satisfies the requirements for multiple common bonds
under § 6-301(c)(3) and (e) of this title.
(4) A multiple common bond credit union may merge or consolidate with another multiple common bond credit
union resulting in a surviving or new multiple common bond credit union provided that:
(i) 1. Prior to a merger, the credit union that will become the surviving credit union includes or adds to its field of
membership the groups served by the credit union that will become the merging credit union, as provided under
§ 6-303 of this title; or
2. In the case of a consolidation, the field of membership of the new credit union includes all groups that will be
served by that new credit union; and
(ii) The surviving or new multiple common bond credit union satisfies the requirements for multiple common bonds
under § 6-301(c)(3) and (e) of this title.
(5) A single or multiple common bond credit union may merge, as the merging credit union, with a community credit
union, as the surviving credit union, provided that:
(i) 1. The merging credit union has a branch within the community boundaries of the surviving credit union; or
2. A majority of the members in the field of membership of the merging credit union would qualify for
membership in the surviving credit union;
(ii) No less than 30 days before the effective date of the merger, the merging credit union gives notice of the
merger to all groups of potential members of the merging credit union that will be removed from the field of
membership as a result of the merger; and
(iii) On and after the effective date of the merger, the surviving credit union:
1. May not continue to serve groups within the field of membership of the merging credit union that are located
outside the community boundaries of the surviving credit union; and
2. May continue to serve members of a group identified under item 1 of this paragraph who are members
before the effective date of the merger.
(6) A community credit union may merge or consolidate with another community credit union provided that:
(i) The members of the surviving or new credit union remain within a single well-defined local community,
neighborhood, rural district, or county; and
(ii) The surviving or new credit union is within reasonable geographic proximity to the members of the credit union
party to the merger or consolidation.
(7) Except as provided in paragraphs (8) and (9) of this subsection, a community credit union may not merge, as a
merging credit union, with a single or multiple common bond credit union.
(8) Notwithstanding the provisions of paragraph (2), (3), (4), or (5) of this subsection or the numerical limitations
prescribed in § 6-301(e) of this title, the Commissioner may approve the merger or consolidation of any credit union
with a multiple common bond credit union, as a new or surviving credit union, when safety and soundness
concerns are present as determined by the Commissioner.
(9) Notwithstanding the provisions of paragraphs (2) through (8) of this subsection, the Commissioner may approve the
merger or consolidation of any credit union, whether or not the credit unions party to the merger or consolidation
have the same field of membership type, if:
(i) Any of the credit unions party to the merger or consolidation is insolvent or likely to become insolvent;
(ii) The merger or consolidation is in the best interest of the membership of the credit unions party to the merger or
consolidation; and
(iii) The merger or consolidation will not adversely affect the financial condition of the surviving or new credit union.
(c) Applicability of State or federal provisions. --
(1) If the surviving or new credit union will be a State credit union:
(i) The merger or consolidation shall be made in accordance with the provisions of this subtitle; and
(ii) If one of the credit unions is a federal credit union, federal law governs its actions and the rights of its members.
(2) If the surviving or new credit union will be a federal credit union:
(i) The merger or consolidation shall be made in accordance with federal law which governs its actions and the
rights of its members; and
(ii) The merger or consolidation shall be made in accordance with the provisions of this subtitle for a State credit
union and the rights of its members.
(3) If the surviving or new credit union will be another State credit union:
(i) The merger or consolidation shall be made in accordance with the provisions of this subtitle for the State credit
union and the rights of its members; and
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(ii) The merger or consolidation shall be made in accordance with the provisions of the other State laws for the
other State credit union and the rights of its members.
(d) Board's actions. -- A majority of the board of each credit union proposing a merger or consolidation shall:
(1) Adopt a resolution that declares that the merger or consolidation is advisable; and
(2) Set a date for a vote on the proposed merger or consolidation by the members of each credit union party to
the merger or consolidation at any annual or special meeting of the membership or by mail ballot to be filed
on or before that date.
(e) Voting methods. -- The Commissioner, at the request of the board, may:
(1) Waive the vote of the members; and
(2) Substitute any reasonable method of determining the approval by the members.
(f) Required plan. -- The merger or consolidation shall be in accordance with a plan that:
(1) States the field of membership type that the surviving or new credit union will have;
(2) Is agreed to by a majority of the board of each credit union party to the merger or consolidation; and
(3) Unless provided otherwise by the Commissioner, is approved by the members of each credit union party to the
merger or consolidation, by the affirmative vote of a majority of the members of each credit union party to the
merger or consolidation who vote on the proposal.
(g) Certificate of merger. --
(1) After agreement by the board and approval by the members of each credit union party to the merger or
consolidation, two officers of each credit union party to the merger or consolidation shall execute a certificate of
merger or consolidation.
(2) The certificate of merger or consolidation shall include as to each credit union party to the merger or
consolidation:
(i) The time and place of the meeting of the board at which the plan was agreed to;
(ii) The vote by which the plan was agreed to by the board;
(iii) A copy of the resolution or other action by which the plan was agreed to by the board;
(iv) The date on or by which the plan was approved by the members of each credit union; and
(v) Unless provided otherwise by the Commissioner, the vote by which the plan was approved by the members of
each credit union.
(h) Bond requirements; further determinations by Commissioner. --
(1) A credit union may merge or consolidate if:
(i) 1. The surviving or new credit union meets the common bond requirements of the proposed field of membership
type; and
2. Each credit union party to the merger or consolidation files with the Commissioner:
A. The certificate of merger or consolidation;
B. A copy of the plan of merger or consolidation; and
C. Any other documents that the Commissioner deems necessary to make a determination on the application;
and
(ii) The Commissioner determines that:
1. Each credit union party to the merger or consolidation has not engaged in any material unsafe or unsound
practice during the 1-year period preceding the date of filing of the certificate of merger or consolidation;
2. The surviving or new credit union has adequate net worth;
3. The surviving or new credit union has the administrative capability to serve the members of the surviving or
new credit union and the financial resources to meet the need for additional staff and assets to serve the
surviving or new credit union; and
4. Any potential harm that the surviving or new credit union may have on any other credit union and its
membership is clearly outweighed, in the public interest, by the probable beneficial effect of the merger or
consolidation in meeting the convenience and needs of the members of the surviving or new credit union.
(2) Unless the Commissioner notifies the credit union that a different time period is necessary, within 60 days after the
certificate of merger or consolidation is filed, the Commissioner shall:
(i) Notify each credit union party to the merger or consolidation of the determination on the application; and
(ii) Certify the certificate of merger or consolidation and return the certificate to each credit union party to the
merger or consolidation.
(i) Effect of merger. -- When the certificate is certified and sent back to the credit unions by the Commissioner:
(1) All of the property, property rights, and members' interest of the credit unions party to the merger or consolidation
belong to the surviving or new credit union without deed, endorsement, or other instrument of transfer;
(2) All of the debts, obligations, and liabilities of the credit unions party to the merger or consolidation are assumed by
the surviving or new credit union; and
(3) The rights and privileges of the members of the credit unions party to the merger or consolidation remain intact.
(j) Recording of certificate and plan. --
(1) The surviving or new credit union shall act promptly to file and record the certified certificate and plan of merger or
consolidation with the State Department of Assessments and Taxation.
(2) When the certificate and plan of merger or consolidation are filed with the State Department of Assessments and
Taxation, the merger or consolidation takes effect.
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Massachusetts Chapter 171, Section 78. Consolidation.
Any two or more credit unions may consolidate into a single corporation on such terms as shall have been agreed upon
by a vote of two-thirds of the board of directors of each corporation, and as shall have been approved in writing by the
commissioner; provided, however, that such action is approved at a special meeting of the members of each
corporation called for that purpose, by a vote of at least a majority of those members present, qualified to vote, and
voting; and provided, further, that such consolidation has been approved in writing by the board of directors of the
Massachusetts Credit Union Share Insurance Corporation, if one or more of such credit unions is a member of said
corporation. A certificate subscribed by the presidents and clerks of all such credit unions, setting forth that each such
credit union has complied with all the requirements of this section shall be submitted to the commissioner and if the
commissioner shall approve such consolidation, he shall endorse his approval upon said certificate.
Articles of consolidation or merger shall be filed with the state secretary which shall set forth the due adoption of an
agreement of consolidation or merger and shall state: (i) the names of the corporations and the name of the resulting or
surviving corporation; (ii) the effective date of the consolidation or merger determined pursuant to the agreement of
consolidation or merger; and, (iii) any amendment to the articles of organization of the surviving corporation to be
effected pursuant to the agreement of merger. Such articles of consolidation or merger shall be signed by the president
or a vice president and the clerk or an assistant clerk of each corporation, who shall state under the penalties of perjury
that the agreement of consolidation or merger has been duly executed on behalf of such corporation and has been
approved as required.
The form on which articles of consolidation or merger are filed shall also contain the following information which shall not
for any purpose be treated as a permanent part of the articles of organization of the resulting or surviving corporation: (1)
the post office address of the initial principal office of the resulting or surviving corporation in the commonwealth; (2) the
name, residence and post office address of each of the initial trustees or directors and the president, treasurer and clerk
of the resulting or surviving corporation; (3) the fiscal year of the resulting or surviving corporation initially adopted; (4) the
date initially fixed in the by-laws for the annual meeting of the shareholders or members of the resulting or surviving
corporation.
The consolidation or merger shall become effective when the articles of consolidation or merger are filed in accordance
with section six, unless said articles specify a later effective date not more than thirty days after such filing, in which event
the consolidation or merger shall become effective on such later date.
If none of the credit unions to be consolidated is a member of the Massachusetts Credit Union Share Insurance
Corporation, the commissioner shall, and if one or more of such credit unions is a member of the Massachusetts Credit
Union Share Insurance Corporation, then the commissioner and the board of directors of the Massachusetts Credit Union
Share Insurance Corporation shall determine the value of shares and deposits, if any, in each consolidated credit union;
and the loan reserve, investment reserve, undivided earnings and any other surplus accounts, if any, of each of such
credit unions shall be disposed of as he or they may direct.
Upon the consolidation of any two or more credit unions under the provisions of this section, the corporate existence of all
but one of the consolidating credit unions shall be discontinued and consolidated into that of the remaining credit union,
which shall continue; and the charter of each other credit union shall become void. All of the rights and privileges of each
consolidating credit union and its right, title and interest to all property of whatever kind and thing in action, and every
right, privilege, interest or asset of conceivable value or benefit then existing which would inure to it except for such
consolidation, shall be deemed fully, and without any right of reversion, to be transferred to or vested in the continuing
credit union, without further act or deed and the continuing credit union shall have and hold the same in its own right to
every extent that the same was owned and held by the consolidating credit union from which it was transferred.
A consolidating credit union’s rights, obligations and relations to any person, member, creditor, trustee or beneficiary of
any trust, as of the effective date of the consolidation, shall remain unimpaired and the continuing credit union shall, by
the consolidation, succeed to all such relations, obligations and liabilities, as though it had itself assumed the relation or
incurred the obligation or liability; and its liabilities and obligations to creditors existing for any cause whatsoever shall not
be impaired by the consolidation; nor shall any obligation or liability of any member in any such credit union, continuing
or consolidating, which is party to the consolidation, be affected by any such consolidation, but such obligations and
liabilities shall continue as fully and to the same extent as the same existed before the consolidation.
A pending action or other judicial proceeding to which any of the consolidating credit unions is a party shall not be
deemed to have abated or to have discontinued by reason of the consolidation, but may be prosecuted to final
judgment, order or decree in the same manner as if the consolidation had not been made; or the continuing credit union
may be substituted as a party to any such action or proceeding to which the consolidating credit union was a party, and
any judgment, order or decree may be rendered for or against the continuing credit union that might have been
rendered for or against such consolidating credit union if consolidation had not occurred.
If the consolidating credit unions have main offices in different counties, the main office of the continuing credit union
shall be the main office of that consolidating credit union which has the greater total assets on the date on which the
merger or consolidation is approved by the board of directors of the last consolidating corporation so to approve.
Chapter 171, Section 78A.
Any 1 or more credit unions may merge or consolidate with 1 or more savings banks, as defined in section 1 of chapter
168, or 1 or more co-operative banks, as defined in section 1 of chapter 170, or 1 or more subsidiary banking institutions, as
defined in section 1 of chapter 167H and section 4 of chapter 167I.
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Chapter 171, Section 78B. Repealed.
Michigan § 490.371 Credit unions; merger.
(1) Two or more domestic credit unions may merge into 1 of the credit unions, or into a newly formed domestic credit
union, if all of the following are met:
(a) The credit union board of each constituent credit union by majority vote adopts a plan of merger that includes all of
the following:
(i) The name of each constituent credit union and the name of the surviving credit union.
(ii) The terms and conditions of the proposed merger, including the manner and basis of converting the member
shares in each constituent credit union into member shares in the surviving credit union, or into cash or other
property, or into a combination of shares, cash, or other property.
(iii) A statement of any amendment to the certificate of organization of the surviving credit union affected by the
merger or a statement that no changes are to be made in the certificate of organization of the surviving credit
union.
(iv) Any other provisions concerning the proposed merger that the constituent credit unions consider necessary or
desirable.
(b) If the credit union board of each constituent credit union adopts the plan of merger, the constituent credit unions
submit the plan of merger to the commissioner. Each constituent credit union shall submit the time and place of the
meeting of the credit union board at which it approved the plan, the vote of the directors on approving the plan,
and a copy of the resolution of the credit union board approving the plan to the commissioner with the plan of
merger.
(c) Subject to subsection (6), the members of each constituent credit union except the surviving credit union approve
the plan of merger, at a special membership meeting called for that purpose or by mail ballot. If the vote is held at
a special membership meeting, the credit union board shall provide each member with written notice of the
meeting that states the purpose of the meeting, at least 7 days and not more than 30 days before the meeting.
The plan of merger is approved if a majority of the members of the constituent credit union that vote on the merger
vote in favor of the merger.
(d) If the membership of a constituent credit union approves of a plan of merger under subdivision (c), the credit union
shall notify the director that the plan of merger is approved, the vote by which the members approved the plan,
and a copy of the meeting notice if the plan was approved at a special membership meeting or the ballot and
mailing date and closing date if the plan was approved by mail ballot of the members.
(e) The director grants final approval of the plan of merger. The director shall grant final approval of the plan if all of
the requirements of subdivisions (a) to (d) are met.
(2) One or more domestic credit unions may merge with 1 or more foreign credit unions if both of the following are
satisfied:
(a) The merger is permitted by the law of the jurisdiction under whose law each foreign constituent credit union is
organized and each foreign constituent credit union complies with that law in effecting the merger.
(b) Each domestic constituent credit union complies with subsection (1).
(3) If a plan of merger under subsection (1) or (2) is approved, each constituent credit union shall execute and file a
certificate of merger with the director that contains all of the following:
(a) The statements required in subsection (1)(a)(i) and (iii).
(b) A statement that the plan of merger has been approved by the members of the constituent credit unions required
to vote under subsection (1)(c).
(c) A statement of any assumed names the surviving credit union will use in this state if the director approves. The
statement shall specify each new assumed name of the surviving credit union, each current assumed name the
surviving entity retains, and each assumed name transferred to the surviving entity from another constituent credit
union.
(d) The proposed effective date of the merger.
(4) When a merger takes effect, all of the following apply:
(a) Every other constituent credit union merges into the surviving credit union and the separate existence of every
constituent credit union except the surviving credit union ceases.
(b) All property, debts, causes of action, and other interests of, belonging to, or due to each constituent credit union
are vested in the surviving credit union without further act or deed and without reversion or impairment.
(c) The surviving credit union has all of the liabilities of each constituent credit union.
(d) A proceeding pending against any constituent credit union may be continued as if the merger had not occurred
or the surviving credit union may be substituted in the proceeding for the constituent credit union if the existence
of the constituent credit union ceased.
(e) The certificate of organization of the surviving credit union is amended to the extent provided in the certificate of
merger.
(f) The membership shares in each constituent credit union are converted into membership shares in the surviving
credit union, cash, or other property as provided in the plan of merger. If a person is a member of more than 1 of
the constituent credit unions, the person is entitled to only 1 membership in the surviving credit union.
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(g) The surviving credit union is liable for, and is subject to service of process in a proceeding in this state for the
enforcement of, any obligation of a domestic constituent credit union.
(5) If the surviving credit union in a merger under subsection (2) is a foreign credit union, and the surviving credit union
transacts business in this state, it shall comply with the provisions of this act concerning foreign credit unions.
(6) The director may waive the membership vote described in subsection (1)(c) for a constituent credit union if he or she
determines that it is in the best interests of the membership of the constituent credit union or that the constituent
credit union is insolvent or in imminent danger of becoming insolvent.
(7) Credit unions with different fields of membership may merge under this section.
Minnesota
§ 52.203 MERGER OR CONSOLIDATION.
Any credit union chartered by this state may merge with and be absorbed by any other state or federal credit union, and
any credit union chartered by this or any other state or any federal credit union may be merged into a successor credit
union chartered by this state, upon approval of all regulatory agencies concerned, and upon compliance with this
section as regards the credit union chartered by this state. At the time of filing with the commissioner of any proposed
merger or consolidation plan, the credit unions proposing to merge or consolidate shall submit a fee of $100 payable to
the commissioner of commerce. The fee shall be paid in equal parts by the credit unions' party to the proposal.
A credit union may be absorbed after two-thirds of its members present and entitled to vote have voted in favor of the
merger at a special meeting called by a majority of the board of directors for that purpose, upon 14 days mailed written
notice to each member at the member's last known address clearly stating the purpose of the special meeting, or at any
regular meeting after like notice of the purpose has been given. Thereafter, the board of directors may execute an
agreement of merger with the successor credit union, subject to approval of the agreement by the commissioner of
commerce.
The commissioner shall approve or disapprove of the agreement within 60 days of the date the agreement is submitted.
The approved agreement must be filed with the secretary of state.
If the successor credit union which absorbs one or more credit unions is chartered by this state it may execute an
agreement of merger upon approval of the agreement by the commissioner of commerce and by the board of directors
of the credit union. The commissioner of commerce shall approve the merger agreement if it is in the best interest of the
credit unions involved. In any event, the commissioner of commerce shall approve or disapprove of the merger
agreement within 60 days of the date the agreement is submitted. Members of, and persons eligible for membership in,
the credit union being absorbed have all rights of membership in the successor credit union.
The charter and license and all other rights and property of the credit union being absorbed is deemed to be transferred
to and invested in the successor credit union upon execution and approval of the merger agreement without further
action. Any pending action or other judicial proceeding to which the credit union being absorbed is a party at the date
of merger does not abate by reason of the merger. If the credit union being absorbed is chartered by this state, its
corporate existence ceases upon the execution and approval of the merger agreement without further action.
Mississippi SEC. 81-13-79. Merger of credit unions; certificate of merger; transfer of rights, assets and interests.
(1) Any credit union may, with the approval of the Commissioner of Banking and Consumer Finance or his successor,
merge with another credit union under the existing charter of the other credit union, pursuant to any plan agreed
upon by the majority of each board of directors of each credit union joining in the merger, and approved by the
affirmative vote of a majority of the members of the merging credit union present at a meeting of its members duly
called for such purpose, and consented to by any government agency or other organization insuring the accounts of
the credit union. Provided, however, such merger shall not be in violation of the provision of Section 81-13-13, which
requires a common bond of occupation, association or residence within groups which are members of a credit union.
(2) After agreement by the directors and approval by the members of the merging credit union, the president and
secretary of the credit union shall execute a certificate of merger, which shall set forth all of the following:
(a) The time and place of the meeting of the board of directors at which the plan was agreed upon;
(b) The vote in favor of the adoption of the plan;
(c) A copy of the resolution or other action by which the plan was agreed upon;
(d) The time and place of the meeting of the members at which the plan agreed upon was approved; and
(e) The vote by which the plan was approved by the members.
(3) Such certificate and a copy of the plan of merger agreed upon shall be forwarded to the Commissioner of Banking
and Consumer Finance or his successor, certified by him, and returned to both credit unions within thirty (30) days.
(4) Upon return of the certificate from the commissioner or his successor, all property, property rights and members' interest
of the merged credit union shall vest in the surviving credit union without deed, endorsement or other instrument of
transfer, and all debts, obligations and liabilities of the merged credit union shall be deemed to have been assumed
by the surviving credit union under whose charter the merger was effected. The rights and privileges of the members
of the merged credit union shall remain intact.
(5) This section shall be construed, whenever possible, to permit a credit union chartered under any other law to merge
with one chartered under Section 81-13-1 et seq., or to permit one chartered under Section 81-13-1 et seq. to merge
with one chartered under any other law.
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Missouri § 370.351. Credit unions may merge--directors to approve plan, procedure.
1. Any two or more credit unions formed under the laws of the state of Missouri and any credit union or unions formed
under the laws of the state of Missouri and any credit union formed under the laws of any other state or of the United
States which is formed for the same purpose for which a credit union might be formed under the laws of this state, may
merge into one of such credit unions.
2. The board of directors of each credit union, by resolution adopted by a majority vote of the members of the board,
shall approve a plan of merger setting forth:
(1) The names of the credit unions proposing to merge and the name of the credit union into which they propose to
merge, which is hereinafter designated as the "surviving credit union";
(2) The terms and conditions of the proposed merger and the mode of carrying the same into effect;
(3) The manner and basis of converting the membership shares of each merging credit union into the membership
shares of the surviving credit union;
(4) A statement of any changes in the articles of agreement and the bylaws of the surviving credit union to be effected
by such merger;
(5) Such other provisions with respect to the proposed merger as are deemed necessary or desirable.
§ 370.352. Consolidation into new credit union--directors to approve plan.
1. Any two or more credit unions organized under the laws of the state of Missouri, or any credit union organized under the
laws of any other state or of the United States and formed for a purpose for which a credit union might be formed
under the laws of the state of Missouri may consolidate into a new credit union.
2. The board of directors of each credit union, by resolution adopted by a majority vote of the members of such board,
shall approve a plan of consolidation setting forth:
(1) The names of the credit unions proposing to consolidate and the name of the new credit union into which they
propose to consolidate, which is hereinafter designated as the "new credit union";
(2) The terms and conditions of the proposed consolidation and the mode of carrying the same into effect;
(3) The manner and basis of converting the membership shares, assets and liabilities of each credit union into
membership shares or assets and liabilities of the new credit union;
(4) With regard to the new credit union, all of the statements required to be set forth in the articles of agreement and
the bylaws for credit unions;
(5) Such other provisions with regard to the proposed consolidation as are deemed necessary or desirable.
§ 370.353. Submission of plan to meeting of members or shareholders--notice.
1. The board of directors of the merging credit union or credit unions, upon approving the plan of merger or consolidation,
shall direct, by a resolution, that the plan be submitted at a meeting of the members or shareholders, which may be
either an annual or special meeting. Notice of the meeting shall be mailed or delivered to each member not more
than thirty days and not less than fourteen days prior to the meeting. All members shall be given the opportunity to vote
on the plan of merger or consolidation at a meeting or by written or electronic ballot received no later than the date
and time announced for the meeting. All members should be provided the opportunity to vote, without being required
to attend the meeting where the proposition is voted on. The notice, whether the meeting is an annual or special
meeting, shall state the place, day, hour, and purpose of the meeting, and a copy or summary of the plan of merger or
plan of consolidation shall be included in or enclosed with the notice. The board of directors of the surviving credit
union named in any such plan of merger need not submit the merger plan to its members but shall, instead, ratify such
merger plan according to the procedure stated in section 370.351.
2. In the case of a consolidation, the board of directors of each credit union party to such plan of consolidation must
submit the plan of consolidation to its members according to the procedure described in subsection 1 of this section.
3. The director may waive any membership meeting required under subsections 1 and 2 of this section upon the request of
the board of directors of any of the merging or consolidating credit unions if the credit union seeking the waiver is in
financial difficulty, if its field of membership is being lost or substantially reduced, or if it has only limited potential of
growth.
§ 370.354. Vote required for approval--director may approve, when.
1. At each such meeting, a vote of the members or the shareholders entitled to vote shall be taken on the proposed plan
of merger or consolidation. The plan of merger or consolidation shall be approved upon receiving the affirmative vote
of a majority of the members present and voting at the meeting of each of the credit unions, provided a quorum is
present.
2. Upon the approval of the members, articles of merger or consolidation shall be submitted to the director of the division
of credit unions, who shall approve the same if the merger or consolidation is made in conformity with the laws of this
state and is in the best interest of the majority of the members thereof.
§ 370.355. Certificate of merger or consolidation, issued when--copies, where filed.
1. Upon approval by the director of the division of credit unions, articles of merger or articles of consolidation shall be
executed in triplicate, by each credit union, by its president, or a vice president, and verified by him, and with the
corporate seal of each credit union affixed thereto, attested by its secretary or an assistant secretary, and shall set forth:
(1) The plan of merger or plan of consolidation;
(2) The total membership of each credit union;
(3) As to each credit union the number of members voting for and against the plan, respectively.
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2. If the director of the division of credit unions finds that the articles conform to law, when all required taxes or fees have
been paid, he shall file the same, keeping one copy as a permanent record, forward a copy to the secretary of state
after having issued a certificate of merger or a certificate of consolidation, and a verified copy of the certificate, to which
he shall affix the other copy of the articles.
3. Upon the issuance of the certificate of merger or the certificate of consolidation by the director of the division of credit
unions, the merger or consolidation shall be effected.
4. The certificate of merger with a copy of the articles of merger affixed thereto by the director of the division of credit
unions, or the certificates of consolidation with the copy of the articles of consolidation and certified copy thereof, with
the copy of the articles of consolidation affixed thereto by the director of the division of credit unions, shall be returned
to the surviving credit union, or new credit union, as the case may be, or to its representative.
§ 370.356. Shareholder may object to merger or consolidation, procedure--payment of value of shares.
1. If a shareholder of a credit union which is a party to a merger or consolidation files with such credit union, prior to or at
the meeting of shareholders or members at which the plan of merger or consolidation is submitted to a vote, a written
objection to such a plan of merger or consolidation, and shall not vote in favor thereof, and the shareholder within ten
days after the merger or consolidation is effected, makes written demand on the surviving or new credit union for
payment of the fair value of his share as of the day prior to the date on which the vote was taken approving the merger
or consolidation, the surviving or new credit union shall pay to such shareholder, upon surrender of his pass book or
other record representing the shares, the fair value thereof as reflected by the books of the company, not including any
goodwill or statutory reserve fund that may be had by the credit union.
2. The demand shall state the number of shares owned by the dissenting shareholder.
3. Any shareholder failing to make demand within the ten day period shall be conclusively presumed to have consented
to the merger or consolidation, and shall be bound by the terms thereof.
§ 370.357. Effect of merger or consolidation.
When the merger or consolidation has been effected:
(1) The several credit unions parties to the plan of merger or consolidation shall be a single credit union which, in the
case of a merger, shall be that credit union designated in the plan of merger as the surviving credit union, and, in
the case of consolidation, shall be the new credit union provided for in the plan of consolidation;
(2) The separate existence of all credit union parties to the plan of merger or consolidation, except the surviving or new
credit union, shall cease;
(3) The surviving or new credit union shall have all the rights, privileges, immunities, and powers, and shall be subject to
all the duties and liabilities of a new credit union;
(4) The surviving or new credit union shall thereupon and thereafter possess all the rights, privileges, immunities, and
franchises of each of the merging or consolidating credit unions; and all property, real, personal, and mixed, and all
debts due on whatever account, loans, and all other choses in action, and all and every other interest of or
belonging to or due to each of the credit unions so merged or consolidated, shall be taken and deemed to be
transferred to and vested in the single credit union, without further act or deed; and the title to any real estate, or
any interest therein, under the laws of this state, vested in any of the credit unions, shall not revert or be in any way
impaired by reason of the merger or consolidation;
(5) The surviving or new credit union shall thenceforth be responsible and liable for all the liabilities and obligations of
each of the credit unions so merged or consolidated; and any claim existing or action or proceeding pending by or
against any of such credit unions may be prosecuted to judgment as if the merger or consolidation had not taken
place, or the surviving or new credit union may be substituted in its place; neither the rights of creditors nor any liens
upon the property of any of the corporations shall be impaired by the merger or consolidation;
(6) In case of a merger, the articles of agreement and the bylaws of the surviving credit union shall be deemed to be
amended to the extent, if any, that changes in its articles are stated in the articles of merger; and, in the case of a
consolidation, the statement set forth in the articles of consolidation, and which are required or permitted to be set
forth in the bylaws of credit unions, shall be deemed to be the articles of agreement of the new credit union.
Montana § 32-3-322. Merger.
(1) Any credit union may, with the approval of the department of administration, merge with another credit union under
the existing charter of the other credit union, pursuant to any plan agreed upon by the majority of each board of
directors of each credit union joining in the merger and approved by the affirmative vote of a majority of the members
of the merging credit union.
(2) After agreement by each board of directors and approval by the members of the merging credit union, the president
and secretary of the credit union shall execute a certificate of merger, which must set forth all of the following:
(a) the time and place of the meeting of each board of directors at which the plan was agreed upon;
(b) the vote in favor of the adoption of the plan;
(c) a copy of the resolution or other action by which the plan was agreed upon;
(d) the time and place of the meeting of the members at which the plan agreed upon was approved; and
(e) the vote by which the plan was approved by the members.
(3) The certificate and a copy of the agreed-upon plan of merger must be forwarded to the department, certified by the
department, and returned to both credit unions within 30 days. A copy of the certificate of merger, the certified plan,
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and the articles of merger must be filed with the secretary of state by the surviving credit union.
(4) Upon return of the certificate from the department, all property rights and members' interest of the merged credit union
vest in the surviving credit union without deed, endorsement, or other instrument of transfer, and all debts, obligations,
and liabilities of the merged credit union are considered to have been assumed by the surviving credit union under
whose charter the merger was effected. The rights and privileges of the members of the merged credit union remain
intact.
(5) This section must be construed, whenever possible, to permit a credit union chartered under any other law to merge
with one chartered under this chapter or to permit one chartered under this chapter to merge with one chartered
under any other law.
Nebraska § 21-17.109. Merger or consolidation.
(1) Any credit union organized under the Credit Union Act may, with the approval of the department, merge or
consolidate with one or more other credit unions organized under the act or under the laws of the United States, if the
credit unions merging or consolidating possess coinciding common bonds of association.
(2) When two or more credit unions merge or consolidate, one shall be designated as the continuing credit union or a
totally new credit union shall be organized. If the latter procedure is followed, the new credit union shall be organized
under the Credit Union Act or under the laws of the United States. All participating credit unions other than the
continuing or new credit union shall be designated as merging credit unions.
(3) Any merger or consolidation of credit unions shall be done according to a plan of merger or consolidation. After
approval by the boards of directors of all participating credit unions, the plan shall be submitted to the department for
preliminary approval. If the plan includes the organization of a new credit union, all documents required pursuant to
section 21-1724 shall be submitted as a part of the plan. In addition, each participating credit union shall submit the
following information:
(a) The time and place of the meeting of the boards of directors at which the plan of merger or consolidation was
agreed upon;
(b) The vote of the directors in favor of the adoption of the plan; and
(c) A copy of a resolution or other action by which the plan was agreed upon.
The department shall grant preliminary approval if the plan has been approved properly by the boards of directors
and if the documentation required to organize a new credit union, if any, complies with section 21-1724. The director,
in his or her discretion, may order a hearing be held if he or she determines that the condition of the acquiring credit
union warrants a hearing or that the plan of merger would be unfair to the merging credit union.
(4) After the department grants preliminary approval, each merging credit union shall, unless waived by the department,
conduct a membership vote on its participation in the plan. The vote shall be conducted either at a special meeting
called for that purpose or by mail ballot. If a majority of the members voting approve the plan, the credit union shall
submit a record of that fact to the department indicating the vote by which the members approved the plan and
either the time and place of the membership meeting or the mailing date and closing date of the mail ballot.
(5) The department may waive any voting requirements described in the Credit Union Act for any credit union upon the
determination that it is in the best interests of the membership or that the credit union is insolvent or in imminent danger
of becoming insolvent.
(6) The director shall grant final approval of the plan of merger or consolidation after determining that the requirements of
subsections (1) through (4) of this section have been met in the case of each merging credit union. If the plan of
merger or consolidation includes the organization of a new credit union, the department must approve the
organization of the new credit union under section 21-1724 as part of the approval of the plan of merger or
consolidation. The department shall notify all participating credit unions of the plan.
(7) Upon final approval of the plan by the department, all property, property rights, and members' interests in each
merging credit union shall vest in the continuing or new credit union as applicable without deed, obligations, and
other instruments of transfer, and all debts, obligations, and liabilities of each merging credit union shall be deemed to
have been assumed by the continuing or new credit union. The rights and privileges of the members of each
participating credit union shall remain intact. If a person is a member of more than one of the participating credit
unions, the person shall be entitled to only a single set of membership rights in the continuing or new credit union.
(8) Notwithstanding any other provision of law, the department may authorize a merger or consolidation of a credit union
which is insolvent or which is in danger of insolvency with any other credit union or may authorize a credit union to
purchase any of the assets of or assume any of the liabilities of any other credit union which is insolvent or which is in
danger of insolvency, if the department is satisfied that:
(a) An emergency requiring expeditious action exists with respect to such credit union;
(b) Other alternatives for such credit union are not reasonably available; and
(c) The public interest would best be served by the approval of such merger, consolidation, purchase, or
assumption.
(9) Notwithstanding any other provision of law, the director may authorize an institution, the deposits or accounts of which
are insured by the Federal Deposit Insurance Corporation or any derivative thereof, to purchase any assets of or
assume any liabilities of a credit union which is insolvent or in danger of insolvency, except that prior to exercising this
authority the director shall attempt to effect a merger or consolidation with, or purchase or assumption by, another
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credit union as provided in subsection (8) of this section.
(10) For purposes of the authority contained in subsection (9) of this section, insured share accounts of each credit union
may, upon consummation of the purchase or assumption, be converted to insured deposits or other comparable
accounts in the acquiring institution, and the department and the National Credit Union Share Insurance Fund shall be
absolved of any liability to the credit union's members with respect to those accounts.
Nevada NRS 678.800 Merger; fees set by regulation; regulations.
1. Any credit union may, with the approval of the Commissioner, merge with another credit union under the existing
charter of the other credit union, pursuant to any plan agreed upon by the majority of the board of each credit union
joining in the merger and approved by the affirmative vote of:
(a) A majority of the members of the merging credit union present at a meeting called for that purpose; or
(b) A majority of the members of the merging credit union voting by mail on the question.
2. After agreement by the directors of each credit union and approval by the members of the merging credit union, the
chair and secretary of each credit union shall execute a certificate of merger, which must set forth:
(a) The time and place of the meeting of the board of directors at which the plan was agreed upon;
(b) The vote in favor of adoption of the plan;
(c) A copy of the resolution or other action by which the plan was agreed upon;
(d) The circumstances of the vote in which the members approved the plan agreed upon, if a vote was required; and
(e) The vote by which the plan was approved by the members, if a vote was required.
3. A copy of each of the certificates executed pursuant to subsection 2 and a copy of the plan of merger agreed upon by
the credit unions joining in the merger must be forwarded to the Division of Financial Institutions for certification and
returned to the credit unions within 30 days.
4. After a merger is effected, all property, property rights and interest of the merged credit union vest in the surviving credit
union without deed, endorsement or other instrument of transfer, and all debts, obligations and liabilities of the merged
credit union are deemed to be assumed by the surviving credit union under whose charter the merger was effected.
5. If the surviving credit union is to be a credit union chartered in accordance with the laws of this state, the application for
approval of the merger must be accompanied by an application fee in an amount prescribed by regulation of the
Commissioner. The applicant shall also pay such additional expenses incurred in the process of investigation as the
Commissioner deems necessary. All money received by the Commissioner pursuant to this subsection must be placed in
the Investigative Account created by NRS 232.545.
6. The Commissioner shall adopt regulations pursuant to which he or she may order any credit union chartered in
accordance with the provisions of this chapter to merge with:
(a) Another credit union chartered in accordance with the provisions of this chapter; or
(b) A credit union chartered in accordance with the laws of another state or of the United States, if a majority of the
board of that credit union approves the merger, when he or she determines that the merger is in the best interest of
the members of the merging credit union.
7. This section is to be liberally construed to permit a credit union chartered in accordance with this chapter to merge
with a credit union chartered in accordance with this chapter or any other provisions of law.
New Hampshire § 383-E:10-1001. Procedural Requirements.
If a state credit union proposed to combine with another state credit union, federal credit union, or foreign credit union,
the credit unions shall apply to the commissioner for approval of the proposed combination as required under RSA 383-
A:6-602 and may complete the combination if permitted by the commissioner, subject to other federal or state
approvals.
§ 383-E:10-1002. Required Vote.
The combination of credit unions is required to be approved by a state credit union first by a majority of its full board of
directors and then by a majority of its members present and voting at a meeting called for that purpose.
New Jersey § 17:13-110. Merger of credit unions.
a. Any credit union may, with the approval of the commissioner, merge with another credit union under the existing
charter of the continuing credit union, pursuant to any plan agreed upon by the majority of the board of each credit
union joining in the merger, approved by the affirmative vote of a majority of the members of the merging credit union
present at a meeting of its members duly called for that purpose, and consented to by any government agency or
other organization insuring the accounts of the credit union.
b. The commissioner may approve a merger according to the plan agreed upon by the majority of the board of each
credit union even if approved by less than a majority of the entire membership, if he finds upon the written and verified
application filed by the board that:
(1) Notice of the meeting called to consider the merger was mailed to each member entitled to vote upon the
question;
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(2) The notice disclosed the purpose of the meeting and properly informed the membership that approval of the
merger might be sought pursuant to this section; and
(3) A majority of the votes cast upon the question were in favor of the merger.
c. After agreement by the board and approval by the members of the merging credit union, the chairman and secretary
of the credit union shall execute a Certificate of Merger, which shall set forth all of the following:
(1) The time and place of the meeting of the board at which the plan was agreed upon;
(2) The vote in favor of the adoption of the plan;
(3) A copy of the resolution or other action by which the plan was agreed upon;
(4) The time and place of the meeting of the members at which the plan agreed upon was approved; and
(5) The vote by which the plan was approved by the members.
d. The certificate and a copy of the plan of merger agreed upon shall not become effective until approved by the
commissioner. If the commissioner has not notified the credit union of his action within sixty days of receipt, the merger
shall be deemed to be approved. Upon the commissioner's approval, the Certificate of Merger shall be filed with the
department.
e. Upon filing of the Certificate of Merger with the department, all property, property rights, and members' interest of the
merged credit union shall vest in the surviving credit union, without deed, endorsement, or other instrument of transfer,
and all debts, obligations and liabilities of the merged credit union shall remain in effect;
f. This section shall be construed, whenever possible, to permit a credit union organized under any other act to merge with
one incorporated under this act, or to permit one incorporated under this act to merge with one organized under any
other act.
New Mexico § 58-11-59. Merger of credit unions.
A. A credit union organized under or subject to the Credit Union Act [58-11-1 NMSA 1978] may, with the approval of the
director and regardless of common bond, merge with one or more other credit unions subject to that act , the laws of
another state or territory of the United States or the laws of the United States.
B. When two or more credit unions merge, they shall either designate one credit union as the continuing credit union or
they shall structure a totally new credit union and designate it as the new credit union. If the latter procedure is
followed, the new credit union shall be organized under Section 58-11-10 NMSA 1978. All participating credit unions
other than the continuing credit union shall be designated as merging credit unions.
C. Any merger of credit unions shall be done according to a plan of merger. After approval by the boards of directors of
all participating credit unions, the plan shall be submitted to the director for preliminary approval. If the plan includes
the creation of a new credit union, all documents required by Section 58- 11-10 NMSA 1978 shall be submitted as part of
the plan. In addition, each participating credit union shall submit:
(1) the time and place of the meeting of the board of directors at which the plan was agreed upon;
(2) the vote of the board of directors in favor of the adoption of the plan; and
(3) a copy of the resolution or other action by which the plan was agreed upon.
The director shall grant preliminary approval if the plan has been properly approved by each board of directors and if
the documentation required to form a new credit union , if any, complies with Section 58-11-10 NMSA 1978.
D. After the director grants preliminary approval, each merging credit union shall, unless waived by the director, conduct
a membership vote on its participation in the plan. The vote shall be conducted either at a special membership
meeting called for that purpose or by mail ballot. If a majority of the members voting approve the plan, the credit union
shall submit a record of that fact to the director, indicating the vote by which the members approved the plan and
either the time and place of the membership meeting or the mailing date and closing date of the mail ballot.
E. The director may waive the membership vote described in Subsection D of this section in the case of a given credit
union if he determines that it is in the best interests of the membership or that the credit union is insolvent or in imminent
danger of becoming insolvent.
F. The director shall grant final approval of the plan of merger after determining that the requirements of Subsection D of
this section in the case of each merging credit union have been met. If the plan of merger includes the creation of a
new credit union , the director shall approve the organization of the new credit union under Section 58-11-10 NMSA
1978 as part of the approval of the plan of merger. The director shall notify all participating credit unions of the
approval of the plan.
G. Upon final approval of the plan by the director, all property, property rights and members' interests in each merging
credit union shall vest in the continuing or new credit union, as applicable, without deed, endorsement or other
instrument of transfer, and all debts, obligations and liabilities of each merging credit union shall be deemed to have
been assumed by the continuing or new credit union . The rights and privileges of the members of each participating
credit union shall remain intact; however, if a person is a member of more than one of the participating credit unions,
that person shall be entitled to only a single set of membership rights in the continuing or new credit union .
H. If the continuing or new credit union is chartered by another state or territory of the United States, it shall be subject to
the requirement of Section 58-11-16 NMSA 1978.
I. Notwithstanding any other provision of law, the director may authorize a merger or consolidation of a credit union that is
insolvent or is in danger of insolvency with any other credit union or may authorize a credit union to purchase any of the
assets of or assume any of the liabilities of any other credit union that is insolvent or in danger of insolvency if the
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director is satisfied that:
(1) an emergency requiring expeditious action exists with respect to that other credit union;
(2) other alternatives are not reasonably available; and
(3) the public interest would best be served by approval by that merger, consolidation, purchase or assumption.
J. Notwithstanding any other provision of law, the director may authorize an institution whose deposits or accounts are
insured by an agency of the federal government to purchase any of the assets of or assume any of the liabilities of a
credit union which is insolvent or in danger of insolvency, except that prior to exercising this authority, the director shall
attempt to effect a merger or consolidation with, or purchase and assumption by, another credit union as provided in
Subsection I of this section.
For purposes of the authority contained in this subsection, insured share and deposit accounts of the credit union may,
upon consummation of the purchase and assumption, be converted to insured deposits or other comparable accounts in
the acquiring institution.
New York § 600. Merger; when authorized.
The following mergers are hereby authorized:
(1) One or more corporations organized under the laws of this state and subject to the provisions of article three, article
eight, article eleven or article twelve of this chapter with another corporation subject to the provisions of the same
article.
§ 601. Merger agreement; authorization; approval; filing.
1. A written plan of merger shall be submitted, in duplicate, to the superintendent by the corporations which are to
merge. Such plan shall be in form satisfactory to the superintendent, shall specify each corporation to be merged an
the corporation which is to receive into itself the merging corporation or corporations, and shall prescribe the terms
and conditions of the merger and the mode of carrying it into effect. Such plan may provide the name to be borne by
the receiving corporation and such name may be the name of any corporation which is a party to such plan or a new
name. Such plan may also name the persons who shall constitute the board of directors or trustees of the receiving
corporation after the merger shall have been accomplished, provided that the number and qualifications of such
persons shall be in accordance with the provisions of this chapter relating to the number and qualifications of directors
or trustees of such a corporation; or, in the case of stock corporations, such plan may provide for a meeting of the
stockholders to elect a board of directors within sixty days after such merger, and may make provision for conducting
the affairs of the corporation meanwhile…. At the time of submission for action by the superintendent of the written
plan of merger, an investigation fee as prescribed pursuant to section eighteen-a of this chapter shall be paid to the
superintendent.
3. In the case of mutual savings banks, mutual savings and loan associations or credit unions, there shall be submitted, in
duplicate, to the superintendent with the plan of merger, a certificate of the president, secretary or cashier of each of
the corporations which are to merge, certifying that such plan has been submitted to a special meeting of the board
of trustees or directors or his corporation, that a notice of at least fifteen days, specifying the time, place and object of
the meeting, together with a copy of the plan has been mailed to each trustee or directors and that such plan has
been approved at such meeting by a vote of two-thirds of all the member of such board of trustees or directors.
North Carolina § 54-109.94. Merger.
Any credit union may, with the approval of the Administrator of Credit Unions, merge with another credit union subject to
the rules and regulations set forth by the Administrator of Credit Unions.
North Dakota § 6-06-36. Merger.
Any credit union chartered under this chapter or under Act of Congress may merge under rules and regulations
established by the state credit union board. A federal credit union proposing to merge into a state-chartered credit union
shall grant the commissioner discretionary authority to conduct an examination. The commissioner shall set fees for such
examination at an hourly rate sufficient to cover all reasonable expenses of the department of financial institutions
associated with the examination.
Fees must be collected by the commissioner, transferred to the state treasurer, and deposited in the financial institutions
regulatory fund. The secretary of state shall charge a fee of fifty dollars for all services in connection with a merger
authorized by the state credit union board, including filing of a certificate of organization or bylaws, and issuing or
canceling charters.
Upon approval by the state credit union board of a merger application under this section, the former main office and
facilities of the credit union merged will become branches of the continuing credit union and the continuing credit union
is not required to file an application for any branches acquired in the merger transaction.
§ 6-06-37. Rules and regulations.
The state credit union board shall prescribe rules and regulations regarding the merger, consolidation, and dissolution of
corporations organized under this chapter and Acts of Congress.
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Ohio § 1733.34 Merger of credit unions.
(A) Any credit union may, with the approval of the superintendent of credit unions, merge with any other credit union
under the existing charter of the other credit union, pursuant to any plan approved by the board of directors of
each credit union joining in the merger, and approved by a majority of the members of each credit union
represented at a meeting of members in person, by ballot, or by proxy, duly called for such purpose, at which a
quorum of the entire membership is present, unless such meeting of members of either credit union has been waived
by the superintendent. The superintendent may waive the members' vote if it is in the interest of the members, credit
union, or for any other reason the superintendent deems proper. After such approval of the board and members of
each credit union, the president or chairperson of the board and secretary of each credit union shall execute a
certificate of merger, which shall set forth all of the following:
(1) The time and place of the meeting of the board of directors at which the plan was agreed upon;
(2) The vote in favor of adoption of the plan;
(3) A copy of the resolution or other action by which the plan was agreed upon;
(4) The time and place of the meeting of the members at which the plan agreed upon was approved;
(5) The vote by which the plan was approved by the members.
(B) Such certificates and a copy of the plan of merger agreed upon shall be forwarded to the superintendent and, upon
approval, returned to the merging credit unions.
(C) Upon any such merger so effected, all property, property rights, and interests of the merged credit unions shall vest in
the surviving credit union without deed, endorsement, or other instrument of transfer, and all debts, obligations, and
liabilities of the merged credit unions shall be deemed to have been assumed by the surviving credit union under
whose charter the merger was effected.
(D) This section shall be construed, whenever possible, to permit a credit union chartered under any other act to merge
with one chartered under this act.
(E) All persons and associations eligible for membership, as provided in section 1733.05 of the Revised Code, of both credit
unions effecting a merger shall be deemed to have a common bond of association.
Oklahoma O.S. §, 2022.
Any credit union may, with the approval of the State Credit Union Board, merge with another credit union under the
existing charter of the other credit union, pursuant to any plan agreed upon by the majority of the board of directors of
each credit union joining in the merger, and approved by the affirmative vote of a majority of the members of the
merging credit union present at a meeting of the members duly called for such purpose. After agreement by the
directors and approval by the members of the merging credit union, the president and secretary of each credit union
shall execute a certificate of merger, which shall set forth all of the following:
(a) The time and place of the meeting of the board of directors at which the plan was agreed upon;
(b) The vote in favor of adoption of the plan; and
(c) A copy of the resolution or other action by which the plan was agreed upon. The certificate executed by the officers
of the merging credit union shall also set forth:
(d) The time and place of the meeting of the members at which the plan agreed upon was approved;
(e) The vote by which the plan was approved by the members; and
(f) The effective date of the merger.
Such certificates and a copy of the plan of merger agreed upon shall be forwarded to the Bank Commissioner who shall,
upon approval of the State Credit Union Board, certify and return them to the merging credit union and the surviving
credit union within sixty (60) days. The merging credit union shall cause a copy of the certificate of merger, duly certified
to by the Bank Commissioner, to be filed in the office of the Secretary of State forthwith. Unless otherwise provided in the
certificate of merger, the merger shall be deemed effected upon such filing of the certificate and the merging credit
union shall cease to exist.
Upon any such merger so effected, all property, property rights, field of membership and interest of the merged credit
union shall vest in the surviving credit union without deed, endorsement or other instrument of transfer, and all debts,
obligations and liabilities of the merged credit union shall be deemed to have been assumed by the surviving credit union
under whose charter the merger was effected.
This section shall be construed, whenever possible, to permit a credit union chartered under any other act to merge with
one chartered under this act, or to permit one chartered under this act to merge with one chartered under any other act.
Oregon
§ 723.682 Merger; opposition to merger.
(1) A credit union chartered in this state may, with the approval of the Director of the Department of Consumer and
Business Services, merge with another credit union under the existing charter of the other credit union pursuant to a
plan that the majority of each board of directors of each credit union joining in the merger agrees to and that is
approved by the affirmative vote of a majority of the members of the merging credit union that vote on the merger.
(2) After the directors agree to a plan and the members of the merging credit union approve the plan, the president and
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secretary of the credit union shall execute a certificate of merger, which shall set forth all of the following:
(a) The time and place of the meeting of the board of directors at which the board agreed to the plan.
(b) The vote in favor of adopting the plan.
(c) A copy of the resolution or other action by which the board agreed to the plan.
(d) The time and place of the meeting of the members at which the members approved the plan.
(e) The vote by which the members approved the plan.
(3) The certificate and a copy of the plan of merger must be forwarded to the director, certified by the director and
returned to the continuing credit union within 30 days.
(4) After the director returns the certificate, all property, property rights and members’ interest of the merged credit union
shall vest in the continuing credit union without deed, indorsement or other instrument of transfer, and the continuing
credit union under whose charter the merger was effected assumes all debts, obligations and liabilities of the merged
credit union. The rights and privileges of the members of the merged credit union remain intact.
(5) This section permits a credit union chartered under the laws of another state or of the United States to merge with a
credit union chartered under the laws of this state, and a credit union chartered under the laws of this state to merge
with a credit union chartered under the laws of another state or of the United States, to the same extent that the laws
of this state permit two or more credit unions chartered under the laws of this state to merge.
(6)(a) After the board of directors of a credit union that is chartered in this state has approved a plan to merge with
another credit union, if a member of the credit union opposes the plan to merge and wishes to inform other
members of the credit union of the member’s opposition, the member may submit a proposed statement of
opposition to the credit union and may ask the credit union to disseminate the statement of opposition to the other
members.
(b) If the credit union maintains on the Internet and publicizes to the credit union’s members a public forum for
communications concerning the plan to merge or other issues related to the credit union, the credit union, within 14
calendar days after receiving the proposed statement of opposition from the member and subject to paragraph
(e) of this subsection, shall publish the statement of opposition on the public forum.
(c) If the credit union does not make a public forum available on the Internet and if the credit union received the
member’s proposed statement of opposition at least 28 days before the date on which the members of the credit
union are to vote on the plan to merge, subject to paragraph (e) of this subsection, the credit union shall:
(A) Notify the member, within seven days after receiving the statement of opposition, of:
(i) Any limit, which may not be less than 500 words, that the credit union may impose on the length of the statement
of opposition; and
(ii) The estimated reasonable cost to reproduce and mail the statement of opposition as a stand alone document or
the estimated cost to include the statement of opposition in any informational or persuasive material concerning
the plan to merge that the credit union disseminates to credit union members. The credit union’s estimate of the
cost of including the statement of opposition in the credit union’s material may not exceed two cents multiplied
by the number of the credit union’s members. Reproduce and mail the statement of opposition to the credit
union’s members or include the statement of opposition in the credit union’s informational or persuasive materials
concerning the plan to merge, within 10 days after receiving payment of the cost estimated in subparagraph
(A)(ii) of this paragraph, if the member agrees to the limit the credit union imposes on the length of the statement
of opposition and pays the cost at least 14 days before the date on which the members of the credit union are
to vote on the plan to merge.
(d) For purposes of paragraph (c) of this subsection, informational and persuasive material concerning the plan to
merge does not include a notice of the meeting at which the credit union’s members are to consider the plan to
merge, a summary of the merger plan or other items that state or federal law requires the credit union to send to
credit union members.
(e)(A) The credit union shall notify the credit union member within seven days after receiving the proposed statement
of opposition if the credit union declines to disseminate the statement of opposition because the statement of
opposition:
(i) Is false or misleading with respect to a material fact at the time and in light of the circumstances in which
the statement is made;
(ii) Omits a material fact that is necessary for the statement of fact not to be false or misleading;
(iii) Relates to a personal claim or grievance or solicits personal gain by or business advantage for any party;
(iv) Is not sufficiently related to the credit union’s business or affairs;
(v) Impugns, directly or indirectly, a person’s character, integrity or personal reputation or without an expressed
factual basis charges a person with illegal, improper or immoral conduct; or
(vi) Impugns the stability or soundness of the credit union.
(B) The credit union may decline to disseminate the proposed statement of opposition if the credit union member
does not agree to the limits the credit union imposes on the length of the statement of opposition or fails within
the time limits set in paragraph (c) of this subsection to pay the cost of mailing the statement or including the
statement with the credit union’s informational or persuasive material concerning the plan to merge.
(C) The credit union may not decline to disseminate the statement of opposition for reasons other than the reasons
identified in subparagraph (A) or (B) of this paragraph.
(f)(A) A credit union member may appeal to the director the credit union’s decision under paragraph (e)(A) of this
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subsection not to disseminate the credit union member’s statement of opposition. An appeal under this
paragraph is not a contested case, as defined in ORS 183.310, and a party to the appeal is not entitled to
notice and an opportunity for a hearing under ORS 183.413 to 183.470. As part of the appeal, the credit union
member shall provide the director with:
(i) The proposed statement of opposition;
(ii) A statement of reasons for disagreeing with the credit union’s decision under paragraph (e)(A) of this
subsection not to disseminate the statement of opposition; and
(iii) The credit union member’s name, address and telephone number or other contact information.
(B) Before issuing an order under this paragraph, the director shall request from the credit union a statement of
reasons for declining to disseminate the proposed statement of opposition. The director shall consider the credit
union member’s proposed statement of opposition and statement of reasons and the credit union’s statement
of reasons and shall arrive at an independent determination as to whether the credit union correctly declined
to disseminate the credit union member’s proposed statement for the reasons identified in paragraph (e)(A) of
this subsection.
(C) The director by order shall uphold the credit union’s decision under paragraph (e)(A) of this subsection or shall
require the credit union to disseminate the credit union member’s proposed statement of opposition in
accordance with the provisions of this subsection. The director’s order is subject to appeal only as provided in
ORS 183.484.
Pennsylvania
§ 1103. Merger and consolidation authorized.
(a) General rule.--A credit union subject to this title may merge or consolidate with other credit unions, with Federal credit
unions, with out-of-State credit unions or with a combination of other credit unions, Federal credit unions and out-of-
State credit unions to form a credit union, Federal credit union or out- of-State credit union.
(b) Approvals and conditions.--Before merging or consolidating, the credit unions involved must obtain prior approval from
the department. In the case of a merger or consolidation with a Federal credit union, the merger or consolidation shall
be made pursuant to Federal law in addition to the provisions of this title. In the case of a merger or consolidation with
an out-of-State credit union, the merger or consolidation shall be made pursuant to the credit union law of the state of
incorporation of the out-of- State credit union or, if credit unions incorporated in different states are involved, pursuant
to the credit union laws of the various states of incorporation of the out-of-State credit unions in addition to the
provisions of this title.
§ 1104. Adoption of plan.
(a) General rule.--The board of directors of each of the credit unions, Federal credit unions or out-of- State credit unions
which desire to merge or consolidate shall, by resolution adopted by at least a majority of all the members of each
board, approve a plan of merger or consolidation setting forth the terms and conditions of the merger or
consolidation and the mode of carrying the same into effect, the manner and basis of converting the shares of each
credit union, Federal credit union or out-of-State credit union into shares or other securities or obligations of the
surviving or new credit union, Federal credit union or out-of-State credit union, and such other details and provisions
as are deemed necessary. Except where the approval of the members is not required, the board of directors shall
direct that the plan be submitted to a vote of the members of such credit union, Federal credit union or out- of-State
credit union entitled to vote thereon at an annual or special meeting of the members to be held on not less than 15
days prior written notice thereof given to each member of record, which notice shall state the place, day, hour and
purpose of the meeting and shall have included therein or enclosed therewith a copy or summary of the plan of
merger or consolidation.
(b) Domestic approval.--The plan of merger or consolidation to form a surviving or new credit union, Federal credit union
or out-of-State credit union shall be adopted upon receiving, if the credit union is not the surviving institution, the
affirmative vote of at least a majority of the members voting thereon or upon receiving, if the credit union is the
surviving institution, the affirmative vote of at least a majority of the board of directors voting thereon.
(c) Federal or out-of-State approval.--The plan of merger or consolidation shall be authorized, adopted or approved by
each of the merging or consolidating Federal credit unions and out-of- State credit unions in accordance with
applicable Federal or State law.
§ 1105. Articles of merger or consolidation.
(a) General rule.--Upon the adoption, pursuant to the provisions of this chapter, of the plan of merger or consolidation by
the credit unions, Federal credit unions and out-of-State credit unions desiring to merge or consolidate, articles of
merger or consolidation shall be executed by each credit union, Federal credit union and out-of-State credit union
by a duly authorized officer of each credit union, Federal credit union and out-of-State credit union and shall set
forth:
(1) The name and exact location of the principal place of business of the surviving or new credit union, Federal credit
union or out-of-State credit union.
(2) The time and place of the meeting of the board of directors at which the plan of merger or consolidation was
proposed and, except where approval of the members is not required, the time and place of the meeting of the
members of each credit union, Federal credit union and out-of-State credit union at which the plan of merger or
consolidation was authorized, adopted or approved, the kind and period of notice given to the members and
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the total vote by which the plan was authorized, adopted or approved.
(3) In the case of a merger into a surviving credit union, any changes desired to be made in the articles of the
surviving credit union, or, in the case of a consolidation into a new credit union, all of the statements required by
this title to be set forth in the original articles in the case of the formation of a credit union.
(4) The number, names and addresses of the persons to be the first directors of the surviving or new credit union,
Federal credit union or out-of-State credit union.
(5) The plan of merger or consolidation.
(b) Department review.--The articles of merger or consolidation shall be filed with the department which, immediately
upon receipt thereof, shall conduct such investigation as may be deemed necessary to ascertain from the best
sources at its command:
(1) Whether, if the articles are articles of consolidation, the name of the proposed new credit union, Federal credit
union or out-of-State credit union conforms with the requirements of law for the name of a credit union and
whether it is the same as one already adopted or reserved by another corporation or person or is so similar
thereto that it is likely to mislead the public.
(2) Whether, if the merger or consolidation includes one or more Federal credit unions, all requirements of the laws of
the United States pertaining thereto have been complied with.
(3) Whether the interests of members and creditors are adequately protected.
(4) Whether the credit unions, including the surviving or new credit union, have met all of the requirements of this
title and have violated none of its prohibitions applicable to a credit union incorporated under this title.
(5) Whether, if the merger or consolidation includes an out-of-State credit union, there is compliance with the
applicable requirements of the law of the state of incorporation of the out-of-State credit union.
Within 60 days after receipt of the articles of merger or consolidation, the department shall, upon the basis of the
facts disclosed by its investigation, either approve or disapprove such articles.
(c) Approval action.--If the department approves the articles, it shall register its approval thereon and shall forthwith
forward them to the Department of State for filing, and, immediately upon receipt thereof, the Department of State
shall file the articles.
(d) Effect of merger or consolidation.--The merger or consolidation shall become effective immediately upon such filing,
and the surviving or new credit union, Federal credit union or out-of-State credit union shall be vested with all the
assets and shall have all the rights, privileges, immunities and franchises and shall be responsible for all the obligations
of the merging or consolidating credit unions, Federal credit unions and out-of-State credit unions; but otherwise, if
such surviving or new credit union shall be a Federal credit union or an out-of-State credit union, upon such filing by
the Department of State, the surviving or new Federal credit union or out-of- State credit union shall no longer be
subject to the provisions of this title other than, in the case of an out-of-State credit union, Chapter 15 (relating to out-
of-State credit unions).
(e) Disapproval action.--If the department shall disapprove the articles, it shall return them to the credit union, Federal
credit union or out-of-State credit union from which they were received, stating the reasons for such disapproval.
(f) Cross reference.--See 15 Pa.C.S. § 134 (relating to docketing statement).
Rhode Island § 19-5-24 Merger. –
(a) Any credit union may, with approval of the director, or the director's designee, merge with another credit union under
the agreement to form of the surviving credit union, pursuant to any plan agreed upon by a two thirds (2/3) vote of
those members of the board of directors of each credit union joining in the merger present at a meeting called for
that purpose. Additionally, the merger must be approved by the affirmative vote of members representing two thirds
(2/3) of the members present of the credit union to be merged, who are eligible to vote pursuant to the bylaws of the
credit union, either at a meeting of the members duly called for that purpose or in writing, and if the merger has a
significant impact on the surviving credit union, as determined by the director, or the director's designee, the merger
must also be approved by the affirmative vote of members representing two thirds (2/3) of the members present of
the surviving credit union, who are eligible to vote pursuant to the bylaws of the credit union, either at a meeting of
the members duly called for that purpose or in writing. The credit union being merged shall be required to mail notice
of the meeting to its members. Notice of the members' meeting shall be mailed to all members of the surviving credit
union in the discretion of the director, or the director's designee. The director, or the director's designee, may waive
any or all of the foregoing requirements with respect to notice or to votes of members of the merged credit union or
the surviving credit union in order to avert insolvency or imminent failure.
(b) Upon approval by the director, or the director's designee, and after the votes by the boards of directors and
approval of the members of the credit union to be merged, the president and clerk or secretary of each credit union
shall execute, in triplicate, a certificate of merger that shall set forth all of the following:
(1) The time and place of the meeting of the board of directors at which the plan was agreed upon;
(2) The vote in favor of adoption of the plan;
(3) A copy of the resolution or other action by which the plan was agreed upon;
(4) The time and place of the meeting of the members at which the plan agreed upon was approved, if applicable;
(5) The vote by which the plan was approved by the members, if applicable; and
(6) The date the merger was approved by the director or the director's designee.
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(c) The certificates, in triplicate, and a copy of the plan of merger agreed upon shall be forwarded to the director, or the
director's designee, and a copy of the certificate, certified by the director, shall be returned to the merging credit
unions within thirty (30) days. Upon any such merger so effected, all property, property rights, and interest of the
merged credit union shall vest in the surviving credit union without deed, endorsement, or other instrument of transfer,
and all debts, obligations, and liabilities of the merged credit union shall be deemed to have been assumed by the
surviving credit union under whose agreement to form the merger was effected.
South Carolina SECTION 34-26-1210. Merger.
A credit union organized under this chapter may, with the approval of the Board of Financial Institutions regardless of
common bond, merge with one or more credit unions organized under this chapter, the laws of another state or territory
of the United States, or the laws of the United States with approval of each credit union's regulator.
Tennessee § 45-4-903. Mergers.
(a) Any credit union may, with the approval of the commissioner of financial institutions, merge with any other credit
union under the existing charter of the other credit union, pursuant to any plan approved by the board of directors of
each credit union joining in the merger, and approved by two thirds (2/3) of the members of each credit union
represented at a meeting of members duly called for that purpose, at which a minimum of ten percent (10%) of the
entire membership is present, unless the meeting of members of either credit union has been waived by the
commissioner. After approval of the board and members of each credit union, the president or chair of the board
and secretary of each credit union shall execute a certificate of merger, which shall set forth all of the following:
(1) The time and place of the meeting of the board of directors at which the plan was agreed upon;
(2) The vote in favor of adoption of the plan;
(3) A copy of the resolution or other action by which the plan was agreed upon;
(4) The time and place of the meeting of the members at which the plan agreed upon was approved; and
(5) The vote by which the plan was approved by the members.
(b) The certificates and a copy of the plan of merger agreed upon shall be forwarded to the commissioner and, upon
approval, returned to the merging credit unions. The certificate of merger, with the certificate of approval of the
commissioner annexed it, shall be recorded in the office of the secretary of state and in the register's office of the
county in which each credit union has its principal place of business.
(c) Upon a merger so effected, all property, property rights, and interests of the merged credit unions shall vest in the
surviving credit union without deed, endorsement, or other instrument of transfer, and all debts, obligations, and
liabilities of the merged credit unions shall be deemed to have been assumed by the surviving credit union under
whose charter the merger was effected.
(d) This section shall be construed, whenever possible, to permit a credit union chartered under any other act to merge
with one chartered under this chapter.
(e) All members of both credit unions effecting a merger shall be deemed to have a common bond of association,
occupation or residence as required by § 45-4-101, for formation of credit unions generally.
(f) A merger fee of three hundred dollars ($300) shall be paid to the commissioner to cover the salary and expenses of
department personnel assigned to supervise the merger. The fee shall be paid by the surviving credit union if it is
chartered under the laws of Tennessee. Otherwise the fee shall be paid by the merging credit union.
Texas Sec. 122.151. AUTHORITY TO MERGE OR CONSOLIDATE.
(a) A credit union may merge or consolidate with another credit union, under the other credit union's existing articles of
incorporation or otherwise, if:
(1) the merger or consolidation is in accordance with commission rules and approved by the
commissioner; and
(2) the merger or consolidation takes place under a plan that has been:
(A) agreed to by a majority of the board of each credit union joining in the merger or consolidation; and
(B) approved by a majority of the members of each credit union voting at a meeting of its members called for that
purpose.
(b) The commissioner may waive the requirement that the members of each credit union approve the plan.
Sec. 122.152. APPLICATION TO MERGE OR CONSOLIDATE.
(a) After agreement by the directors and approval by the members, if applicable, of each credit union or federal credit
union, the chairman and secretary of each credit union or federal credit union shall execute a certificate of merger
or consolidation that:
(1) includes a copy of the resolution or other action by which the board agreed to the merger or consolidation plan;
and
(2) states:
(A) the time and place of the board meeting at which the board agreed to the merger or consolidation plan;
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(B) the board's vote for and against adoption of the plan;
(C) the time and place of the meeting at which the members approved the plan, if applicable;
(D) the membership's vote for and against approval of the plan, if applicable; and
(E) the name of the surviving credit union.
(b) The merging credit union or a consolidating credit union shall submit the certificates and a copy of the merger or
consolidation plan to the commissioner.
Sec. 122.153. DECISION BY COMMISSIONER; APPEAL.
(a) Subject to Subsection (b), on approving the merger or consolidation, the commissioner shall return the certificates and
plan to the merging or consolidating credit unions.
(b) The commissioner may conditionally approve a merger or consolidation. If approval is conditional, the commissioner:
(1) shall state the condition in the order approving the merger or consolidation; and
(2) may not deliver the approved certificate until the condition has been met.
(c) Notwithstanding any other law, the commissioner may authorize a credit union that is insolvent or is in danger of
insolvency to merge or consolidate with another credit union or may authorize a credit union to purchase any of the
assets of, or assume any of the liabilities of, another credit union that is insolvent or in danger of insolvency if the
commissioner is satisfied that:
(1) an emergency requiring expeditious action exists with respect to the credit union that is insolvent or in danger of
insolvency;
(2) another option is not reasonably available; and
(3) the public interest would best be served by approval of the merger, consolidation, purchase, or assumption.
(d) If the commissioner disapproves the merger or consolidation or imposes a condition, the merging or consolidating
credit unions may appeal the commissioner's decision to the commission in the manner provided by Section 122.007
for an appeal on an application to incorporate a credit union.
Sec. 122.1531. CONSIDERATIONS IN DETERMINATION.
In determining whether to approve or disapprove the merger or consolidation, the commissioner shall consider the
availability and adequacy of financial services in the local community and the effect that the merger or consolidation
would have on the local community. The commission by rule shall establish other appropriate criteria that the
commissioner must consider in making the determination.
Sec. 122.154. PROPERTY, OBLIGATIONS, AND LIABILITIES OF MERGED OR CONSOLIDATED CREDIT UNION.
After a merger or consolidation is effected:
(1) the property of the merged or consolidated credit union vests in the surviving credit union without an instrument of
transfer or endorsement; and
(2) the obligations and liabilities of the merged or consolidated credit union are assumed by the surviving credit union.
Sec. 122.155. CONSTRUCTION OF SUBCHAPTER.
This subchapter shall be construed, when possible, to permit a credit union authorized to do business in this state under
other law to merge or consolidate with a credit union authorized to do business under this subtitle.
Sec. 122.156. RULES TO ADDRESS CERTAIN PROCEDURES.
The rules adopted under this subchapter must specify in detail the procedures that:
(1) a credit union must follow to obtain commissioner approval of a merger or consolidation; and
(2) the commissioner must follow in approving or disapproving the merger or consolidation.
Utah
§ 7-9-39. Voluntary merger.
(1) A credit union may merge with another credit union under the existing charter of the other credit union when all of the
following have occurred:
(a) the majority of the directors of each merging credit union votes in favor of the merger plan;
(b) the commissioner approves the merger plan;
(c) subject to Subsection (7):
(i) the majority of the members of each merging credit union present at a meeting called for the purpose of
considering the merger plan votes to approve the merger plan; or
(ii) the majority of the members of each merging credit union votes to approve the merger plan by means of United
States Postal Service mail; and
(d) (i) the National Credit Union Administration or its successor federal deposit insurance agency approves the merger
plan and commits to insure deposits of the surviving credit union; or
(ii) the commissioner approves the surviving credit union to operate without federal deposit insurance in
accordance with Section 7-9-45.
(2) Upon merger, the chair of the board and secretary of each credit union shall execute, and file with the department, a
certificate of merger setting forth:
(a) the time and place of the meeting of the board of directors at which the plan was approved;
(b) the vote by which the directors approved the plan;
(c) a copy of the resolution or other action by which the plan was approved;
(d) the time and place of the meeting of the members at which the plan was approved;
(e) the vote by which the members approved the plan; and
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(f) the effective date of the merger, which shall be:
(i) the date on which the last approval or vote required under Subsection (1) was obtained; or
(ii) a later date specified in the merger plan.
(3) On the effective date of a merger:
(a) the property, property rights, and interests of the merged credit union shall vest in the surviving credit union without
deed, endorsement, or other instrument of transfer; and
(b) all debts, obligations, and liabilities of the merged credit union are considered to have been assumed by the
surviving credit union.
(4) Except as provided in Subsection (5)(b), if the surviving credit union is chartered under this chapter, the residents of a
county in the field of membership of the merging credit union may not be added to the field of membership of the
surviving credit union, except that the surviving credit union:
(a) may admit as a member any member of the merging credit union that is not in the field of membership of the
surviving credit union if the member of the merging credit union was a member of that credit union at the time of
merger; and
(b) may service any member-business loan of the merging credit union until the member-business loan is paid in full.
(5) (a) This section shall be interpreted, whenever possible, to permit a credit union chartered under this chapter to merge
with a credit union chartered under any other law if the preservation of membership interest is concerned.
(b) The commissioner may under Subsection (1)(b) approve a merger plan that includes the addition of the residents
of a county in the field of membership of the merging credit union to the field of membership of the surviving
credit union if the commissioner finds that:
(i) the expansion of the field of membership of the surviving credit union is necessary for that credit union's safety
and soundness; and
(ii) the expanded field of membership of the surviving credit union meets the criteria stated in Subsection 7-9-
52(3)(c).
(6) If the commissioner approves a merger plan under Subsection (5)(b) under which the surviving credit union's field of
membership after the merger will include residents of more than one county, Subsections (6)(a) through (e) apply to
the surviving credit union.
(a) The domicile-county of the surviving credit union is:
(i) if the credit union does not have a field of membership under Subsection7-9-53(2)(c), the county in which the
credit union has located the greatest number of branches as of the date the merger is effective; or
(ii) if the credit union has a field of membership under Subsection7-9-53(2)(c), the county that is the domicile-
county of the surviving credit union under Section 7-9-53;
(b) Within the surviving credit union's domicile-county, the surviving credit union may establish, relocate, or otherwise
change the physical location of the credit union's:
(i) main office; or
(ii) branch.
(c) Within a county other than the domicile-county that is in the field of membership of the surviving credit union
after the merger, the surviving credit union may not:
(i) establish a main office or branch if the main office or branch was not located in the county as of the date
that the merger is effective;
(ii) participate in a service center in which it does not participate as of the date that the merger is effective; or
(iii) relocate the surviving credit union's main office or a branch located in the county as of the date that the
merger is effective unless the commissioner finds that the main office or branch is being relocated within a
three-mile radius of the original location of the main office or branch.
(d) After the merger, the surviving credit union may admit as a member:
(i) a person in the surviving credit union's field of membership after the date that the merger is effective; or
(ii) a person belonging to an association that:
(A) is added to the field of membership of the credit union; and
(B) resides in the domicile-county of the surviving credit union, as defined in Section7-9-53.
(e) In addition to any requirement under this Subsection (6), a surviving credit union shall comply with any
requirement under this title for the establishment, relocation, or change in the physical location of a main office
or branch of a credit union.
Vermont § 34101. Mergers.
(a) General. Any two or more credit unions may merge into one Vermont credit union in accordance with the procedures
and subject to the conditions and limitations set forth in this chapter.
(b) Adoption of plan. The governing body of each participating credit union shall adopt, by a majority vote or higher if
required by its organizational documents, a plan of merger on such terms as mutually agreed upon. The plan shall
include:
(1) The names of the participating credit unions and their locations;
(2) With respect to the continuing credit union: the name and location of its principal office, offices, and facilities;
the name, address, and occupation of each director who is to serve until the next annual meeting of the
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members; and the name and address of each officer;
(3) The amount of capital, the number of outstanding shares, and provisions governing the manner and basis of
converting deposits, accounts, or shares of such credit union into deposits, accounts, or shares of the continuing
credit union;
(4) The amendments required to be made to the continuing credit union's organizational documents;
(5) The resulting field of membership of the continuing credit union;
(6) A statement that the agreement is subject to approval of the Commissioner and of the members of each
participating credit union;
(7) Provisions, if applicable, governing the manner in which the continuing credit union will return accounts and
shares, with interest to date, to dissenting members of the participating credit unions;
(8) A business plan for the continuing credit union;
(9) The anticipated effective date of such merger; and
(10) Such other provisions and details as may be necessary to perfect the merger or as may be required by
the Commissioner.
(c) Commissioner's approval. Following approval by a majority vote of the governing body of each participating credit
union, unless a higher percentage is required by either credit union's organizational documents, the plan of merger or
assumption, together with certified copies of the authorizing resolutions adopted by the governing body of each
participating credit union, shall be forwarded to the commissioner for approval pursuant to subchapter 8 of chapter
220 of this title; provided, however, the approval of the Commissioner shall not be required for any transaction in
which the continuing credit union will be a federal credit union. If the Commissioner disapproves the plan, the
Commissioner shall state the reasons for the disapproval in writing and furnish them to the participating credit unions.
The credit unions shall be given an opportunity to amend the plan to eliminate the reasons for disapproval.
(d) Vote of members. The plan of merger, as approved by the Commissioner, shall be submitted to the members of each
participating credit union for their approval at such credit union's annual meeting or at a special meeting called for
that purpose in the following manner. Unless a greater percentage is required by the organizational documents of
either credit union, the plan of merger or assumption must be approved by a majority vote of the members present
at a meeting called for this purpose. The vote constitutes the adoption of the organizational documents of the
continuing credit union, including amendments, contained in the merger agreement.
(e) Executed plan; certificate; effective date. The following provisions apply to the executed plan, certificate, and
effective date.
(1) Upon approval by the members of each participating credit union, an executive officer and the secretary of
each credit union shall submit the executed plan of merger to the Commissioner, together with the certified
record of the vote of the members approving it, each certified by these officers.
(2) Upon receipt of the items in subdivision (1) of this subsection and evidence that the participating credit unions
have complied with all applicable federal laws, state laws, and regulations, the Commissioner shall issue to the
continuing credit union a certificate specifying the name of each participating credit union and the name of the
continuing credit union. The continuing credit union shall file a copy of the certificate with the Secretary of State
for recording. This certificate is conclusive evidence of the merger and of the correctness of all proceedings
relating to the merger in all courts and places. The certificate may be filed in the appropriate land records offices
to evidence the new name in which property of each participating credit union is to be held.
(3) Unless a later date is specified in the certificate, the merger is effective upon filing of the certificate as provided in
subdivision (2) of this subsection, and the authority of all but the surviving credit union shall terminate
automatically upon filing. The Commissioner may file or order any credit union to file conforming documents with
the Secretary of State.
(4) Any plan of merger may contain a provision that, notwithstanding approval of the members or the Commissioner,
the plan may be abandoned at any time prior to the effective date of the merger by the governing body of any
participating credit union, either at the absolute discretion of the governing body or upon the occurrence of any
stated condition.
(f) Federal credit union as participant. If one of the parties to a merger with a Vermont credit union is a federal credit
union, the participants shall comply with all requirements imposed by federal law for such merger in addition to the
requirements contained in this title and shall provide evidence of such compliance to the Commissioner.
(g) Sections 34103 and 34104 of this title apply to mergers and acquisitions made pursuant to this chapter.
(h) Authority for expedited mergers. Notwithstanding any other provision of law or any organizational document of any
participating credit union, following approval of the plan of merger by a majority vote of the governing body of each
participating credit union and receipt by the Commissioner of certified copies of the authorizing resolutions adopted
by the governing body of each participating credit union, the Commissioner may waive any requirement of
subsection (b) of this section, may waive the requirements of subsection (d), and may order that the merger become
effective immediately if the Commissioner believes that the action is necessary for the protection of the members or
the public.
§ 34102. Merger of Vermont credit union with federal credit union.
(a) Nothing contained in the law of this State restricts the right of a credit union organized under this title to merge into a
continuing federal credit union. The corporate action to be taken by the Vermont credit union and its rights and
liabilities and those of its members are the same as those prescribed in section 34101 of this title, except that approval
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of the Commissioner is not required.
(b) Upon the effective date of the merger, the authority of the participating Vermont credit union shall terminate
automatically. The continuing federal credit union shall notify the Secretary of State of the termination.
§ 34103. Effect of merger or conversion.
(a) Applicability. From and after the effective date of a merger or conversion, under chapter 224 or 225 of this title, the
continuing credit union may conduct business in accordance with the terms of the plan as approved and in
accordance with this chapter.
(b) Continuing entity. Whenever the authority of any participating or converting credit union has been terminated, the
continuing credit union shall be deemed to be a continuation of the entity of the participating or converting credit
union such that all property of the participating or converting credit union, including rights, titles, and interests in and
to all property of whatsoever kind, whether real, personal, or mixed, and things in action, and every right, privilege,
interest, and asset of any conceivable value or benefit then existing, or pertaining to it, or which would inure to it,
including appointments, designations, and nominations, and all rights and interests in any fiduciary capacity, shall
immediately by act of law and without any conveyance or transfer and without further act or deed be vested in and
continue to be that property of the continuing credit union; and such continuing credit union shall have, hold, and
enjoy the same in its own right as fully and to the same extent as the same was possessed, held, and enjoyed by the
participating or converting credit union, and such continuing credit union as of the time of the taking effect of such
merger or conversion shall continue to have and succeed to all the rights, obligations, and relations of the
participating or converting credit union. Furthermore, unless the plan provides otherwise or the Commissioner orders
otherwise, the resulting field of membership of the continuing credit union shall be the combined field of membership
of both participating credit unions, and the continuing credit union may continue to operate the offices of the other
participating credit union.
(c)Effect on judicial proceedings. All pending actions and other judicial proceedings to which the participating or
converting credit union is a party shall not be deemed to have been abated or to have been discontinued by reason
of such merger or conversion, but may be prosecuted to final judgment, order, or decree in the same manner as if
such merger or conversion had not been taken; and such credit union resulting from such merger or conversion may
continue such action in its new name, and any judgment, order, or decree may be rendered for or against it which
might have been rendered for or against the participating or converting credit union theretofore involved in such
judicial proceedings.
(d) Creditor's rights. The continuing credit union in a merger or conversion shall be liable for all obligations of the
participating or converting credit union which existed prior to such merger or conversion, and the merger or
conversion taken shall not prejudice the right of a creditor of the participating or converting credit union to have his or
her debts paid out of the assets thereof, nor shall such creditor be deprived of or prejudiced in any action against the
officers, directors, corporators, or members of a participating or converting credit union for any neglect or misconduct.
(e) Powers and attributes of continuing organization. Whenever credit unions merge, the surviving organization, except as
provided in this chapter, shall have, possess, and own, but separately and distinguishably as provided by this chapter,
all property, rights, powers, franchises, privileges, and appointments whether existing, contingent or future, corporeal
or incorporeal, tangible or intangible of every nature whatsoever of each of the merging organizations. If any of the
merging organizations are acting or have been acting or have been nominated, appointed, delegated, or
designated by any court, person, or otherwise to act in a fiduciary capacity, the continuing organization shall have,
possess, and be vested with and succeed to all of the property, rights, powers, privileges, duties, and obligations
appertaining to each such fiduciary capacity without further or additional appointment, obligation, or designation.
The continuing credit union shall be a continuation of the entity of each and all of the organizations so merged; each
such entity, however, remaining separable and distinguishable to the extent provided in this chapter. It may exercise
the franchise of each of the organizations separably and distinguishably as well as the composite franchises of all.
Except as provided in this chapter, it shall hold, exercise, and perform all rights, powers, privileges, duties, and
obligations appertaining to any and all representative or fiduciary relationships of each of the merged credit unions,
and shall be liable for all of the debts, contracts, and obligations of each of the merged credit unions. Any such debt,
undertaking, or obligations of any merged credit union may be enforced against it as fully and effectively as it could
have been against the merged credit union.
(f) Disposal of property and assets. The continuing credit union shall have the right to use, control, sell, or dispose of all real
and personal estate, rights, or interests of the merged credit unions and convey the same by deed, assignment,
endorsement, contract, or other conveyance, either in its own name or in the name of any merged credit unions as
hereinafter provided, or in the names of both, as fully and effectively as the merged credit unions could have done;
and may maintain suit in its own name or in the name of any such credit union, as provided in this subchapter, or in
the names of both, to foreclose or recover any title, right, demand, or claim appertaining to the merged credit unions.
To this end and except as provided in the contract of merger, the existence of each of the merged credit unions shall
be deemed and treated as having continued each separably and distinguishably for all purposes necessary or
convenient to liquidate the assets of any merged credit unions. Any receipt, assignment, endorsement, transfer,
option, compromise, acquittance, release, or contract to sell, convey, or exchange may be executed in its name or in
the name of the continuing credit unions, or both. Any other thing may be done in either or both of these names
which may be necessary or proper for the reduction to cash of any assets of a foreclosure, of any rights or titles, or the
doing of any other acts or things appropriate to the winding up of the affairs of the merging organization as a
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separate entity. Those contracts and agreements shall be executed, and those acts shall be done under the control
of the directors of the continuing organization.
§ 34104. Nonconforming activities; cessation.
(a) Applicability. If, as a result of a merger or conversion pursuant to this title, the continuing credit union is to be of a
different type or of a different character than any one or all of the participating or converting institutions, such
continuing credit union shall be subject to the conditions and limitations as set forth in this chapter.
(b) Plan for termination. The plan of merger or conversion shall set forth the method and schedule for terminating those
activities not permitted by the laws of this state for the continuing credit union, but which were authorized for any of the
participating or converting institutions.
(c)Effective date. The plan of merger or conversion shall state that from the effective date of such action, the continuing
credit union shall not engage in any nonconforming activities, except to the extent necessary to fulfill obligations
existing prior to merger or conversion, pursuant to subsection (d) of this section.
(d) Compliance with limitations. If, as a result of such merger or conversion, the continuing credit union exceeds any
lending, investment, or other limitations imposed by this title, it shall conform to such limitations within such period of
time as shall be established by the Commissioner.
(e) Divestiture. The Commissioner may, as a condition to such merger or conversion, require a nonconforming activity to
be divested in accordance with such additional requirements as he or she may deem appropriate under the
circumstances.
Virginia § 6.2-1344. Voluntary merger.
A. A credit union organized under this chapter may merge, with the approval of the Commission, with one or more other
credit unions, state or federal. In any case in which the surviving credit union will be a Virginia state-chartered credit
union, a merger application, accompanied by an application fee of $300, shall be filed with the Commission. The
Commission shall approve the application if the Commission finds that:
1. The field of membership of the credit union which is proposed to result from the merger satisfies the requirements of
subsection B of § 6.2-1327, unless the merger application is exempt from this condition pursuant to subsection B;
2. The plan of merger will promote the best interests of the members of the credit unions; and
3. The members of the merging credit unions have approved the plan of merger in accordance with applicable laws
and regulations. Notwithstanding subsection D of § 13.1-895, the members of a Virginia state-chartered credit union
may authorize a plan of merger by vote of at least a majority of all votes cast thereon at an annual or special
meeting at which a quorum is present. Notwithstanding the terms of § 13.1-895, in a merger where a Virginia credit
union will be the resulting credit union, the adoption of the plan of merger by the board of directors of that credit
union shall be sufficient approval of the plan, and approval of the plan of merger by the members of that credit
union shall not be required. Notice of the meeting may be given in a manner prescribed in the articles of
incorporation or bylaws, notwithstanding the terms of § 13.1-842 relating to the manner of notice. A federal credit
union merging with a state credit union may give notice to its members as prescribed by federal regulation.
B. The condition set forth in subdivision A 1 shall not apply to a merger of two Virginia state-chartered credit unions, and
notwithstanding subsection B of § 6.2-1327 the field of membership of the surviving credit union may be composed of
a combination of the fields of membership of the merging credit unions, if (i) at least one of the merging credit unions
has fewer than 35,000 active members on the date the application for merger is filed with the Commission and (ii)
neither of the merging credit unions has been a party to a merger pursuant to this subsection within the 24 months
preceding the date the application for merger is filed with the Commission.
C. If the Commission finds that the requirements of subsection A have been met and all required fees have been paid, it
shall approve the merger and issue a certificate of merger, which shall be admitted to record in its office and in the
office for the recording of deeds in the city or county in which the registered office of each credit union is located. No
such further recordation shall be required in the City of Richmond or the Counties of Chesterfield or Henrico.
D. Upon the issuance of the certificate of merger the provisions of § 13.1-897, mutatis mutandis, shall become effective.
E. For the purposes of this section, a member entitled to vote may vote in person or, unless the articles of incorporation or
bylaws otherwise provide, by proxy. A member may appoint a proxy to vote or otherwise act for him by signing an
appointment form. An appointment of a proxy becomes effective when received by the secretary or other officer or
agent authorized to tabulate votes. An appointment is valid for 11 months unless a different period is expressly
provided in the appointment form or the appointment is revoked by the member.
Washington RCW 31.12.461 Mergers.
(1) For purposes of this section, a “merging credit union” is a credit union whose charter ceases to exist upon merger with
the continuing credit union, and a “continuing credit union” is a credit union whose charter continues upon merger
with the merging credit union.
(2) A credit union may be merged with another credit union with the approval of the director and in accordance with
requirements the director may prescribe. The merger must be approved by a majority vote of the board of each
credit union and a majority vote of those members of the merging credit union voting on the merger at a
membership meeting. The requirement of approval by the members of the merging credit union may be waived by
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the director if the merging credit union is in imminent danger of insolvency.
(3) The property, rights, and interests of the merging credit union transfer to and vest in the continuing credit union
without deed, endorsement, or instrument of transfer, although instruments of transfer may be used if their use is
deemed appropriate. The debts and obligations of the merging credit union that are known or reasonably should be
known are assumed by the continuing credit union.
(4) The continuing credit union shall cause to be published notice of merger once a week for three consecutive weeks in
a newspaper of general circulation in the county in which the principal place of business of the merging credit union
is located.
(5) The notice of merger must also inform creditors of the merging credit union how to make a claim on the continuing
credit union, and that if a claim is not made upon the continuing credit union within thirty days of the last date of
publication, creditors' claims that are not known by the continuing credit union may be barred.
(6) Except for claims filed as requested by the notice, or debts or obligations that are known or reasonably should be
known by the continuing credit union, the debts and obligations of the merging credit union are discharged.
(7) Upon merger, the charter of the merging credit union ceases to exist.
(8) Mergers are effective after the thirty-day notice period to creditors and all regulatory waiting periods have expired,
and upon filing of the credit union's articles of merger by the secretary of state, or a later date stated in the articles,
which in no event may be later than ninety days after the articles are filed.
West Virginia §31C-10-2. Merger of credit unions.
(a) A credit union organized under this chapter may, with the approval of the commissioner and regardless of common
bond, merge with one or more other credit unions organized under this chapter, the laws of another state or territory
of the United States or the laws of the United States.
(b) When two or more credit unions merge, they shall either designate one of them as the continuing credit union, or they
shall structure a totally new credit union and designate it as the new credit union. If the latter procedure is followed,
the new credit union shall be organized under article two of this chapter. All participating credit unions other than the
continuing or new credit union shall be designated as merging credit unions.
(c) Any merger of credit unions shall be done according to a plan of merger. After approval by the boards of directors
of all participating credit unions, the plan shall be submitted to the commissioner for review and hearing to grant
preliminary approval. If the plan includes the creation of a new credit union, all documents required by section one,
article two of this chapter shall be submitted as part of the plan. In addition to any other documents or information
required by the commissioner, each participating credit union shall submit the following:
(1) The time and place of the meeting of the board of directors at which the plan was agreed upon;
(2) The vote of the directors in favor of the adoption of the plan; and
(3) A copy of the resolution or other action by which the plan was agreed upon.
(d) The commissioner shall after review and hearing, grant preliminary approval by written order, if: (i) The plan has been
approved properly by each board of directors; (ii) the documentation required to form a new credit union, if any,
complies with section one, article two of this chapter; (iii) the action would not result or tend to create a monopoly, or
substantially lessen competition, or otherwise further a restraint of trade, unless the anticompetitive effects of the
proposed action are clearly outweighed in the public interest by the probable effect of the action in meeting the
convenience and needs of the members to be served; and (iv) taking into consideration the financial and managerial
resources and further prospects of the credit unions concerned, the action would not be contrary to the best interests
of the community whose shares are affected by such action, nor detrimental to the safety and soundness of the credit
union to be acquired.
(e) After the commissioner grants preliminary approval, each merging credit union shall, unless waived by the
commissioner, conduct a membership vote on its participation in the plan. The vote shall be conducted either at a
special membership meeting called for that purpose or by mail ballot. If a majority of the members voting approve the
plan, the credit union shall submit a record of that fact to the commissioner indicating the vote by which the members
approved the plan and either the time and place of the membership meeting or the mailing date and closing date of
the mail ballot.
(f) The commissioner may waive the membership vote described in subsection (e) of this section for any credit union upon
determining that the credit union is insolvent or about to be insolvent.
(g) The commissioner shall grant final approval of the plan of merger after determining that the requirements of subsection
(e) of this section in the case of each merging credit union have been met. If the plan of merger includes the creation
of a new credit union, the commissioner must approve the organization of the new credit union under section two,
article two of this chapter as part of the approval of the plan of consolidation. The commissioner shall notify all
participating credit unions of the approval of the plan.
(h) Upon final approval of the plan by the commissioner and the filing of the proper documents with the office of the
Secretary of State, all property, property rights, and members' interests in each merging credit union shall vest in the
continuing or new credit union as applicable without deed, endorsement, or other instrument of transfer, and all
debts, obligations and liabilities of each merging credit union shall be deemed to have been assumed by the
continuing or new credit union. The rights and privileges of the members of each participating credit union shall
remain intact; however, if a person is a member of more than one of the participating credit unions, that person shall
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be entitled to only a single set of membership rights in the continuing or new credit union.
(i) If the surviving or new credit union created by the transaction is chartered by another state or territory of the United
States, it shall, in addition to the criteria set forth in subsection (c) of this section, be subject to the requirements of
section six, article two of this chapter. No merger resulting in an out- of-state credit union acquiring a West Virginia
credit union shall be permitted unless that other state or territory permits a West Virginia credit union to merge or
acquire credit unions in their state or territory on terms that are, on the whole, substantially no more restrictive than
those established under the terms of this section: Provided, That no such merger shall be approved where the West
Virginia credit union to be acquired has been in operation for less than two years.
(j) Notwithstanding any other provision of law, the commissioner may, without prior hearing, authorize a merger or
consolidation of a credit union which is insolvent or is about to be insolvent with any other credit union or may
authorize a credit union to purchase any of the assets of, or assume any of the liabilities of, any other credit union
which is insolvent or about to be insolvent if the commissioner is satisfied that:
(1) An emergency requiring expeditious action exists with respect to such other credit union;
(2) Other alternatives are not reasonably available; and
(3) The public interest would best be served by approval of such merger, consolidation, purchase or assumption.
(k) Notwithstanding any other provision of law, the commissioner may authorize an institution whose deposits or accounts
are insured by the Federal Deposit Insurance Corporation to purchase any of the assets of, or assume any of the
liabilities of, a credit union which is insolvent or about to be insolvent, except that prior to exercising this authority the
commissioner should consider attempting to effect a merger or consolidation with, or purchase and assumption by,
another credit union as provided in subsection (j) of this section; and
(l) For purposes of the authority contained in subsection (k) of this section, insured share and deposit accounts of the
credit union may upon consummation of the purchase and assumption be converted to insured deposits or other
comparable accounts in the acquiring institution, and the commissioner and the insuring organization shall be
absolved of any liability to the credit union's members with respect to those accounts.
Wisconsin § 186.31 Mergers.
(1) Transfer of assets and liabilities. Any credit union, which is in good faith winding up its business for the purpose of
merging with another credit union, may transfer its assets and liabilities to the credit union with which it is in the process
of merging; but no merger may be made without the consent of the office of credit unions, and not then to defeat or
defraud any of its creditors in the collection of debts against such credit union.
(2) Approval. To effect a merger, the board of directors of each credit union shall, by resolution, propose a specific plan
for merger which shall be agreed to by a majority of the board of each credit union joining in the merger. The
proposed merger plan shall be submitted to a vote at an annual or special meeting of members of the merging credit
union. Written notice of the meeting setting forth the proposed plan of merger or a summary shall be given to each
member of the merging credit union within the time and in the manner provided for the giving of notice of meetings
of members of the credit union. The proposed plan shall be adopted upon receiving a majority of the votes entitled to
be cast by members present at the meeting.
(2m) Emergency merger. Notwithstanding sub. (2), if the office of credit unions determines that the merging credit union is
in danger of insolvency, and that the proposed merger would reduce or avoid a threatened loss to federal share
insurance, the office of credit unions may permit the merger to become effective without an affirmative vote of the
membership of the merging credit union.
(3) Rights transferred. The credit union merging with another credit union shall not be required to go into liquidation but its
assets and liabilities shall be reported by the credit union with which it has merged, and all the rights, franchises and
interests of the merging credit union to any property belonging to the credit union shall be considered to be
transferred, and the resulting credit union shall hold and enjoy the same and all rights of property, franchises and
interest in the same manner and to the same extent as was held and enjoyed by the merging credit union. The
members or shareholders of the merging credit union shall without any further act on their part be members and
shareholders of the resulting credit union and be subject to all rights, privileges and duties as provided for in the bylaws
of the resulting credit union.
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Comparative Digest of Credit Union Acts*: Change in Corporate Status
Provisions from State Credit Union Acts
Credit Union Charter Conversion
*There are 47 state credit union acts. Delaware, South Dakota, and Wyoming do not have a state credit union act.
2015 Model Credit Union Act:
Section 9.30. Credit Union Conversion.
(1) A credit union chartered under the laws of this state may be converted to a Federal Credit Union or a
Foreign Credit Union, subject to regulations issued by the Commissioner.
(2) A Federal Credit Union or a Foreign Credit Union may convert to a credit union incorporated under the
laws of this state. To effect such a conversion, a converting federal or Foreign Credit Union must comply
with all of the requirements of its current chartering jurisdiction, and the requirements of the
Commissioner, and must file proof of such compliance with the Commissioner.
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Comparative Digest of Credit Union Acts*: Change in Corporate Status
Provisions from State Credit Union Acts
Credit Union Charter Conversion
*There are 47 state credit union acts. Delaware, South Dakota, and Wyoming do not have a state credit union act.
Alabama § 5-17-22. Merger and conversion procedures.
Any credit union may, with the approval of the Administrator of the Alabama Credit Union Administration, merge with
another credit union, under the existing certificate of organization of the other credit union, pursuant to any plan agreed
upon by the majority of each board of directors of each credit union joining in the merger. In addition to approval by the
administrator and each board of directors, the membership of the merging credit union must also approve the merger
plan in the following manner:
(8) A federal credit union may be converted to a credit union chartered under the laws of Alabama and a state credit
union may be converted to a federal credit union by adhering to the requirements for the conversion of a federal
credit union to a state credit union as specified by the Federal Credit Union Act, presently 12 U.S.C. § 1771(a)(1).
Alaska Sec. 06.45.240. Conversions.
(a) A federal credit union may convert into a credit union organized under this chapter by complying with applicable
federal law and by qualifying under this chapter.
(b) A credit union organized under this chapter may convert into a federal credit union by complying with this chapter
and by qualifying under federal law.
Arizona §6-588. Conversion of credit union.
A. A credit union incorporated under the laws of this state may be converted to a credit union organized under the laws of
the United States, or it may be converted to a credit union organized under the laws of another state if the principal
office has relocated to another state or jurisdiction, in the following manner:
1. On recommendations of the board of directors, the members of a credit union incorporated under the laws of this
state, by an affirmative majority vote of all members voting in a meeting called for that purpose or by written ballot
filed within fifteen days, may resolve to convert the credit union into a federal credit union or a credit union
organized under the laws of another state.
2. Within twenty days after the meeting at which the members determine to so convert, the credit union shall file with
the superintendent a certificate verified by the affidavit of the president or the chairman and the secretary of the
credit union. The certificate shall contain a copy of the minutes of the meeting and a statement that the members
have approved the determination to convert the credit union into a federal credit union or a credit union organized
under the laws of another state.
3. The filing of the certificate required in paragraph 2 of this subsection with the superintendent is presumptive proof or
evidence of the holding of the meeting and the action taken.
4. After the meeting of the members, the credit union shall take such action as is necessary under the federal law or the
state law to which it is converting as a credit union. It shall also liquidate in a manner approved by the superintendent
any assets or liabilities which are not by reason of law capable of being transferred to the converted credit union.
Within ten days after the receipt of the new charter or certificate of incorporation, the credit union shall file with the
superintendent and the corporation commission a copy of the instrument. On this filing, the credit union ceases to be
a credit union incorporated under the laws of this state and is converted to one under its new jurisdiction.
5. At the time the conversion becomes effective, the credit union ceases to be supervised by this state and all of the
property of the credit union, including all of its right, title and interest in and to all property of every kind and
character, immediately by operation of law and without any conveyance or transfer and without any further act or
deed is vested in the converted credit union under its new name and structure and under its new jurisdiction.
6. The converted credit union shall have, hold and enjoy the property prescribed in paragraph 5 of this subsection in its
own right as fully and to the same extent as the property was possessed, held and enjoyed by it as a credit union
under the laws of this state. The converted credit union continues to be responsible for all of the obligations of the
former credit union to the same extent as though the conversion had not taken place. The converted credit union is
merely a continuation of the former credit union under a new name and new jurisdiction and the revision of its
corporate structure as is necessary for its proper operation under the new jurisdiction.
B. A credit union organized under the laws of the United States or of any other state may convert to a credit union
incorporated under the laws of this state in the following manner:
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1. To effect such a conversion a credit union shall first comply with all of the requirements of the jurisdiction under
which it is organized and file proof of the compliance with the superintendent.
2. The converting credit union through its proper officers and officials shall sign and acknowledge in quintuplicate a
certificate of organization as required in sections 6-506 and 6-507 in which they bind themselves to comply with the
requirements of the certificate and with all the laws and rules applicable to a state credit union. The application for
a certificate of organization in quintuplicate, the bylaws in duplicate and the required charter fee and examination
assessment shall be submitted to the superintendent who shall make or cause to be made an appropriate
investigation for the purpose of determining the advisability of such a conversion. On receipt of the superintendent's
certificate of organization in quadruplicate, with the certificate of approval, the applicants shall file the certificate
of approval attached in quadruplicate with the corporation commission and record a certified copy of the filing
under the seal of the commission with the county recorder of the county or counties in which the credit union is to
do business. On proof of the recording, the corporation commission shall issue a certificate of incorporation to the
credit union. The credit union shall forward a certified copy of the certificate of organization showing the filing and
recording to the superintendent. The credit union shall also file with the corporation commission the appointment of
an agent on whom service of process may be made.
3. Within ten days after the receipt of the certified copy of the certificate of incorporation by the credit union, the
credit union shall file two certified copies of the certificate with its present supervisory agency and a copy of the
transmittal letter with the superintendent.
4. On filing the certified copy of the certificate of organization with the superintendent, the converting credit union
ceases to be a credit union under its former jurisdiction and is a credit union under the laws of this state. All of the
property of the credit union, including all of its right, title and interest in and to all property of every kind and
character, immediately, by operation of law and without any conveyance or transfer and without any further act or
deed, is vested in the credit union under its new name and style as a state credit union and under its new
jurisdiction.
5. The converted credit union shall have, hold and enjoy the property prescribed in paragraph 4 of this subsection in its
own right as fully and to the same extent as the property was possessed, held and enjoyed by it as a credit union
under its former jurisdiction and the converted credit union continues to be responsible for all of the obligations of
the former credit union to the same extent as though conversion had not taken place. The converted credit union is
merely a continuation of the former credit union under a new name and new jurisdiction and the revision of its
corporate structure as is considered necessary for its proper operation under the new jurisdiction.
C. A credit union incorporated under the laws of this state may be converted into an association, as defined in section 6-
401, that is incorporated under the laws of this state or of the United States if the credit union complies with both of the
following:
1. The provisions established by the national credit union administration as prescribed by 12 Code of Federal Regulations
part 708a.
2. Any rules that the superintendent adopts to implement this subsection.
Arkansas § 23-35-702. Conversion to or from federal credit union.
The State Credit Union Supervisor shall issue regulations to permit the conversion of a credit union operating under this
chapter to a federal credit union and the conversion of a federal credit union to a credit union operating under this
chapter.
California
§ 15300.
A credit union may convert itself into a federal credit union by following the procedure contained in this article.
§ 15301.
Upon recommendation of the board of directors the members of any credit union may by an affirmative majority vote of
such members resolve to convert such credit union into a federal credit union. For the purposes of this article, an
"affirmative majority vote of such members" means that the vote by the members to convert the credit union into a
federal credit union is approved or ratified by the affirmative vote of a majority of the votes represented and voting at a
duly held meeting at which a quorum is present (which affirmative votes also constitute a majority of the required
quorum) or written ballot in conformity with Section 7513 of the Corporations Code or by the affirmative vote or written
ballot as may be provided in the bylaws pursuant to subdivision (e) of Section 7151 of the Corporations Code.
§ 15302.
Within 10 days after the meeting or written vote at which the members determine to convert into a federal credit union,
the credit union shall file with the commissioner a certificate verified by the board of directors of such credit union. The
certificate shall contain a copy of the minutes of the meeting or a copy of the written ballot and the results of the written
vote and a statement that the members have approved the determination to convert such credit union into a federal
credit union. A copy of such certificate shall be filed with the Secretary of State.
§ 15303.
A certified copy of the certificate required by Section 15302 filed in the office of the Secretary of State is presumptive
evidence of the holding of the meeting or written vote and the action taken thereat.
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§ 15304.
After the meeting or the written vote of the members, the credit union shall take such action as is necessary to make it a
federal credit union, and within 10 days after receipt of the federal charter, the credit union shall file with the
commissioner and with the Secretary of State, a copy of the charter issued to such credit union by the National Credit
Union Administration or a certificate showing the organization of such credit union as a federal credit union certified by or
on behalf of the National Credit Union Administration. Upon the filing of such instrument with the Secretary of State the
credit union ceases to be a state credit union and is a federal credit union.
§ 15305.
At the time the conversion into a federal credit union becomes effective, the credit union ceases to be supervised by this
state and all of the property of the credit union, including all of its right, title, and interest in and to all property of every
kind and character immediately, by operation of law and without any conveyance, or transfer and without any further
act or deed, is vested in the credit union under its new name and style as a federal credit union and under its new
jurisdiction.
§ 15306.
The converted federal credit union shall have, hold, and enjoy the property mentioned in Section 15305 in its own right as
fully and to the same extent as the property was possessed, held, and enjoyed by it as a state credit union and the
federal credit union shall continue responsible for all of the obligations of the state credit union to the same extent as
though the conversion had not taken place. The federal credit union shall be merely a continuation of the state credit
union under a new name and new jurisdiction and such revision of its corporate structure as is considered necessary for its
proper operation under the new jurisdiction.
§ 15350.
Upon recommendation of its board of directors, any federal credit union may convert into a credit union under the laws
of this state by complying with the requirements of the Federal Credit Union Act (12 U.S.C. Sec. 1771) and on obtaining a
certificate pursuant to Chapter 2 (commencing with Section 14100) of this division.
§ 15351.
The officers and directors of the federal credit union shall be the officers and directors of the credit union after conversion
takes effect, to hold office until their successors are elected and qualified.
§ 15352.
The commissioner may conduct a joint audit of the federal credit union with federal auditors. Upon completion of such
audit, he shall issue a certificate to the National Credit Union Administration showing the results of such audit. The
commissioner may also certify that the transfer of the assets and liabilities from the federal credit union to a credit union
subject to the laws of this state has been effected in compliance with the applicable laws of this state. The costs of the
audit mentioned in this section shall constitute a charge against the credit union.
§ 15353.
Copies of the minutes of the proceedings of the meeting of the members or the written ballot and the record of written
vote of the members in which they voted to convert into a state credit union, verified by the board of directors of the
credit union, shall be filed within 10 days after the meeting or written vote with the commissioner, and, in duplicate, with
the National Credit Union Administration.
§ 15354.
The verified copies of the minutes of the meeting or the record of written vote, when filed as required by Section 15353,
are presumptive evidence of the holding of, and the action taken at, the meeting or the written vote.
§ 15355.
After an affirmative vote as provided in Section 15350, the federal credit union shall take or cause to be taken such action
in the manner prescribed and authorized by this division as shall make it a credit union of this state. The directors shall file
the documents and take such proceedings as are required by this division in the case of the original incorporation of a
credit union.
§ 15356.
The directors of a credit union converted from a federal credit union may insert in the articles of incorporation the
following statement: "This credit union is incorporated by conversion from a federal credit union."
§ 15357.
Within 10 days after the filing of the articles of incorporation with the Secretary of State, there shall be filed, with the
National Credit Union Administration, two copies of the articles of incorporation, certified by the Secretary of State.
§ 15358.
Upon the filing of the articles of incorporation with the Secretary of State and the issuance of a certificate by the
commissioner authorizing the federal credit union to act as a credit union under the laws of this state, the credit union
ceases to be a federal credit union and is a credit union under the laws of this state. All of the property of the credit union
immediately, by operation of law and without any further act, is vested in the credit union under its new name and
existence as a credit union under the laws of this state.
§ 15359.
The converted credit union shall have, hold, and enjoy the property mentioned in Section 15358 in its own right as fully
and to the same extent as the property was possessed, held, and enjoyed by it as a federal credit union and the
converted credit union continues responsible for all of the obligations of the federal credit union to the same extent as
though conversion had not taken place. The converted credit union is merely a continuation of the federal credit union
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under a new name and new jurisdiction and such revision of its corporate structure as is considered necessary for its
proper operation under the new jurisdiction.
Colorado § 11-30-120.5. Conversion -- state to federal credit union -- federal to state credit union.
(1) A credit union organized under the provisions of this article may be converted into a federal credit union by complying
with the requirements of this section.
(2) (a) The proposition for such conversion shall first be approved by a majority of the directors of the credit union. If so
approved, the proposition shall be submitted to a meeting of its members. The notice of such meeting shall be in
writing and may be delivered in person to each member or mailed to each member at the address for such
member appearing on the records of the credit union. Such delivery or mailing shall be not more than thirty days
nor less than seven days prior to the time of the meeting. Approval of the proposition for conversion shall be by the
affirmative vote of not less than two-thirds of the members present and voting at the meeting.
(b) A copy of the minutes of such meeting, verified by the affidavits of the president or vice-president and the
secretary of the meeting, shall be filed with the administrator within ten days after the meeting.
(3) Within ninety days after such meeting, the credit union shall take such action as may be necessary under the federal
credit union act to convert into a federal credit union, and, within ten days after receipt of the federal credit union
charter, there shall be filed with the commissioner a copy of the charter thus issued. Upon such filing the credit union
shall cease to be a state credit union.
(4) Upon ceasing to be a state credit union, such credit union shall no longer be subject to any of the provisions of the
state law under which said credit union was organized; except that the successor federal credit union, being vested
with all of the assets, shall continue to be responsible for all of the obligations of the state credit union to the same
extent as though the conversion had not taken place.
(5) A credit union organized under the laws of the United States may be converted into a credit union organized under
the laws of this state by complying with all requirements to cease being a federal credit union and doing all acts and
obtaining all authorization necessary to organize as a credit union under the provisions of this article.
Connecticut Sec. 36a-468b. Conversion of Connecticut credit union into federal credit union.
(a) A Connecticut credit union that has been in existence and continuously operating for at least five years may convert
into a federal credit union upon the approval of the conversion by the commissioner as provided in this section.
(b) The Connecticut credit union proposing to convert shall file an application with the commissioner. Such application
shall include (1) a plan of conversion adopted by a majority vote of the governing board and a copy of the governing
board’s resolution adopting the plan of conversion, (2) a proposed written notice of the date, time and place of a
regular or special meeting of the members of the converting Connecticut credit union for the vote on the proposed
conversion, including a proposed form of any proxy and mail ballot, (3) proof of compliance with all applicable
federal laws to effect the conversion, and (4) any additional information as the commissioner may require.
(c) The converting Connecticut credit union shall give written notice of the date, time and place of the meeting at which
the plan of conversion is to be considered, which notice shall be hand-delivered or mailed to each member of the
converting Connecticut credit union at such member’s last-known address as shown on the records of such
Connecticut credit union not less than thirty or more than fifty days prior to the date of the meeting.
(d) Each member of the converting Connecticut credit union may cast one vote on the proposed plan of conversion. The
affirmative vote of two-thirds of all the members voting, including those votes cast in person and those ballots properly
completed and received by the credit union prior to the time of the meeting, shall be required for approval of the
proposed conversion. A statement of the results of the vote, verified by the secretary of the meeting, shall be filed with
the commissioner within ten days after the meeting.
(e) The commissioner shall approve a conversion under this section if the commissioner determines that
(1) the converting credit union has complied with the requirements of sections 36a-435a to 36a-472a, inclusive, and (2)
the programs, policies and procedures of the converting credit union relating to anti- money-laundering activity
are adequate, and the converting credit union has a record of compliance with anti-money-laundering laws and
regulations.
(f) Promptly after receipt of the commissioner’s approval and in no event later than ninety days thereafter, the converting
Connecticut credit union shall take such action as may be necessary under the applicable federal law to make it a
federal credit union. Within ten days after the converting Connecticut credit union receives a federal credit union
charter and a certificate of insurance, such credit union shall file with the commissioner a copy of the federal charter
and certificate of insurance.
(g) The converting credit union shall, within ninety days after the receipt of a charter as a federal credit union: (1) File with
the Secretary of the State a certificate, signed by any two officers under oath, stating that the credit union has
converted to a federal credit union pursuant to this section and the approval of the commissioner; (2) obtain from the
Secretary of the State one or more certified copies of the certificate and the commissioner’s approval; and (3) record
the certified copies in the office of the town clerk of each town in this state where such credit union owns real
property. The converted federal credit union possesses all of the rights, privileges and powers granted to it by its
federal charter, and all of the assets, business and good will of the converting institution are transferred to and vested
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in it without any deed or instrument of conveyance provided the converting credit union may execute any deed or
instrument of conveyance as is convenient to confirm such transfer. The converted credit union is subject to all of the
duties, relations, obligations, trusts and liabilities of the converting credit union, whether as debtor, depository, registrar,
transfer agent, executor, administrator, trustee or otherwise, and is liable to pay and discharge all such debts and
liabilities, to perform all such duties and to administer all such trusts in the same manner and to the same extent as if
the converted credit union had itself incurred the obligation or liability or assumed the duty, relation or trust. All rights
of creditors of the converting credit union and all liens upon the property of such institution are preserved unimpaired
and the converted credit union is entitled to receive, accept, collect, hold and enjoy any and all gifts, bequests,
devises, conveyances, trusts and appointments in favor of or in the name of the converting credit union and whether
made or created to take effect prior to or after the conversion.
Sec. 36a-469b. Conversion of federal or out-of-state credit union into Connecticut credit union.
(a) A federal credit union or an out-of-state credit union may convert into a Connecticut credit union by complying with
all federal requirements or requirements of the chartering state for conversion; (2) filing with the commissioner proof of
such compliance; and (3) filing with the commissioner an application which shall include: (A) A plan of conversion and
a copy of the governing board’s resolution adopting the plan of conversion, (B) a three-year business plan, including
pro forma financial statements, (C) a copy of the proposed certificate of incorporation signed by the proposed
directors and a copy of the proposed bylaws, (D) information addressing the determinations contained in subsection of
this section, and (E) any additional information as the commissioner may require.
(b) When the commissioner has been satisfied that all of the requirements of subsection (a) of this section, and all other
requirements of sections 36a-435a to 36a-472a, inclusive, have been complied with, and the commissioner determines
that (1) the conversion would serve the economic needs of the proposed field of membership and is in accordance
with sound credit union practices, (2) the converting credit union will have the managerial capacity and the financial
resources to serve the proposed membership group, (3) the converting credit union has adequate net worth to meet
all applicable regulatory requirements, and (4) the programs, policies and procedures of the converting credit union
relating to anti-money-laundering activity are adequate, and the converting credit union has a record of compliance
with anti-money-laundering laws and regulations, the commissioner shall (A) issue an approval of the conversion,
which may contain such conditions as the commissioner may require, and (B) issue a certificate of authority to engage
in the business of a Connecticut credit union.
(c) The converting credit union shall promptly file and record the approval, its certificate of incorporation and the
certificate of authority with the Secretary of the State. Upon such filing and recording, the federal credit union or out-
of-state credit union shall become a Connecticut credit union as of the date it ceases to be a federal credit union or
out-of-state credit union. A copy of the converting credit union’s certificate of incorporation and the certificate of
authority, certified by the Secretary of the State, shall be filed with the commissioner within ten days of the filing of
such documents.
(d) The converted Connecticut credit union possesses all of the rights, privileges and powers granted to it by its certificate
of incorporation, and all of the assets, business and good will of the converting credit union are transferred to and
vested in it without any deed or instrument of conveyance provided the converting credit union may execute any
deed or instrument of conveyance as is convenient to confirm such transfer. The converted credit union is subject to
all of the duties, relations, obligations, trusts and liabilities of the converting credit union, whether as debtor, depository,
registrar, transfer agent, executor, administrator, trustee or otherwise, and is liable to pay and discharge all such debts
and liabilities, to perform all such duties and to administer all such trusts in the same manner and to the same extent as
if the converted credit union had itself incurred the obligation or liability or assumed the duty, relation or trust. All rights
of creditors of the converting credit union and all liens upon the property of such credit union are preserved
unimpaired and the converted institution is entitled to receive, accept, collect, hold and enjoy any and all gifts,
bequests, devises, conveyances, trusts and appointments in favor of or in the name of the converting credit union and
whether made or created to take effect prior to or after the conversion.
(e) Within ninety days of conversion, the Connecticut credit union shall record a certificate, signed by any two officers
stating that the conversion is effective, in the office of the town clerk in each town in this state where the Connecticut
credit union owns real property.
Florida
§ 657.066. Conversion from state credit union to federal credit union and conversely.
Any credit union organized under this chapter may convert into a federal credit union and any federal credit union may
convert into a credit union organized pursuant to this chapter upon approval of the authority under the supervision of
which the converted credit union will operate and upon compliance with applicable laws.
(1) Any action by the board of directors proposing conversion shall be by resolution and shall require the affirmative vote
of an absolute majority of the board of directors.
(2) The board of directors shall cause to be transmitted to the authority under the supervision of which the converted credit
union will operate a copy of the resolution adopted by the board of directors and a conversion application.
(3) Upon the written approval of the authority under the supervision of which the converting credit union is to operate,
the converting credit union shall become a credit union under this chapter or under the laws of the United States, as
the case may be, and thereupon all assets shall become the property of the converted credit union, subject to all
existing liabilities against the credit union. All shares and deposits shall remain intact. Any federal credit union
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seeking to convert to a state-chartered credit union shall pay a nonrefundable filing fee of $500. The office may
conduct an examination of any converting federal credit union before approving the conversion and the
converting credit union shall pay a nonrefundable examination fee as provided in s. 655.411(1)(b).
(4) Upon the approval of the authority under the supervision of which the converted credit union will operate, a copy of
the resolution shall be provided to each member, together with a notice setting forth the time, location, and
purpose of a meeting of the membership which shall be held not less than 10 or more than 30 days following the
transmission of the notice.
(5) A ballot allowing an affirmative or negative vote on the proposed conversion shall also be provided to each
member. Any ballot received by the credit union prior to the meeting called to consider the conversion shall be
counted along with the votes cast at the meeting. Each member shall have one vote. A majority of the votes cast
by the members is required to approve the conversion.
(6) Within 10 days after the approval by the membership, the board of directors shall cause to be transmitted to the
authority under the supervision of which the converted credit union will operate a copy of the resolution adopted by
the board of directors and approved by the membership with confirmation of the vote.
(7) Every conversion must be completed within 90 days after the approval of the authority under the supervision of
which the converted credit union will operate. Upon receiving its certificate of authorization or charter from the
authority under the supervision of which the converted credit union will operate, the old certificate of authorization
or charter shall be returned to the proper authority and shall be canceled.
(8) In consummation of the conversion, the old credit union may execute, acknowledge, and deliver to the newly
chartered credit union the instruments of transfer necessary to accomplish the transfer of any property and all right,
title, and interest therein.
Georgia §7-1-668. Conversion of state and federal credit unions.
(a) Any credit union operating in this state may convert into a federal chartered credit union, and any federal credit
union may convert into a credit union organized under this chapter upon approval of the authority under whose
supervision the converted credit union will operate and upon compliance with applicable federal laws as to a
converted federal credit union and upon compliance with applicable state laws as to a converted credit union. In
the case of a federal credit union converting to a state credit union, such converting credit union may keep its
existing members at the time of conversion, but after conversion eligibility for membership in the converted credit
union must comply with state law. If there are other areas of noncompliance with state law, the credit union must
provide the department with a plan to bring those areas into compliance with Georgia law within a reasonable
period, to be determined by the department.
(b) The procedure for obtaining such approval and effecting the conversions in the case of a credit union shall be as
follows:
(1) A meeting of the board of directors, either regular or special, shall be called for the purpose of voting on
converting from a federal credit union to a credit union or from a credit union to a federal credit union. A majority
of the board of directors shall adopt a resolution approving the contemplated conversion;
(2) A meeting, either regular or special, of the shareholders shall then be called for voting on the proposed
conversion. Notice of said meeting shall be given in the manner prescribed in Code Section 7- 1-6 and shall
include a statement indicating that the proposed conversion will be considered at the meeting. Proof of giving of
the notice shall be by the affidavit of the president of the credit union. A majority of the members present at this
meeting shall then approve the proposed conversion;
(3) Within ten days after such approval of the conversion, the president or vice-president and treasurer shall file a
verified copy of the resolution adopted by the board of directors with the state or federal authority under whose
supervision the converting credit union is to operate.
(c)Upon the written approval of the department for conversions to credit unions and with the written approval of the
National Credit Union Administration for conversions to federal credit unions, the converting credit union shall then
become a credit union under the laws of this state or the United States, as the case may be; and thereupon all assets
shall become the property of the new credit union or federal credit union, as the case may be, subject to all existing
liabilities, and every person who was a member of the converting credit union shall be a member in the new credit
union or federal credit union.
(d) (1) Conversions by state chartered credit unions to financial institutions other than credit unions or financial institutions
other than credit unions to state chartered credit unions shall be effected by approval of the department and
compliance with any other applicable law. The department may prescribe other requirements in order to protect
the rights of members or the funds invested.
Hawaii §412:3-606 Conversion from State to comparable federal financial institution.
(a) A Hawaii financial institution may convert to a comparable federal financial institution if the conversion is approved at
a meeting of its shareholders or members duly called and noticed and upon a vote which satisfies the requirements of
section 412:3-604.
(b) Within ten days after the meeting of its shareholders or members approving the conversion, the financial institution shall
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file with the commissioner:
(1) A notice of intention to convert; and
(2) A certificate signed by two executive officers of the financial institution verifying the validity of the meeting,
that the required vote was obtained, and that the attached copy of the resolution to convert adopted at the
meeting is true and correct.
(c) Within a reasonably prompt time and without any unnecessary delay after the meeting approving the conversion,
the financial institution shall take the action necessary to complete the conversion and to obtain a federal
license, charter, certificate, or other approval to become a federal financial institution.
(d) The date of issuance of the federal license, charter, certificate, or other approval, or the effective date of
conversion stated in the license, charter, certificate or other approval, shall be the effective date of the conversion.
(e) Upon the effective date of the conversion as determined under federal law, the institution's state charter or license
shall terminate without further notice, and the institution shall cease to be regulated by the commissioner. Within
ten days after receipt of the federal charter, license, certificate, or other approval, the resulting financial institution
shall deliver a copy thereof to the commissioner. The resulting financial institution shall also file with the director of
commerce and consumer affairs a confirmation in writing by the commissioner of the date and time of the
conversion, together with the appropriate filing fee pursuant to chapter 414.
§412:3-607 Conversion from federal to comparable Hawaii financial institution.
(a) A federal financial institution whose operations are principally conducted in this State may convert to a comparable
Hawaii financial institution if the institution, and its holding company or holding companies, if any, shall have complied
with all requirements, conditions, and limitations imposed by federal law with respect to the conversion, subject to any
rights of dissenting shareholders or members and to obtaining a charter under this chapter.
(b) The federal financial institution shall file an application with the commissioner pursuant to section 412:3-603 for a charter
to engage in business as a comparable Hawaii financial institution pursuant to this chapter. The application shall be
accompanied by:
(1) A certificate signed by two executive officers of the financial institution, verifying that it has complied with all
federal laws and regulations relating to the conversion;
(2) The information required from applicants for approval to organize a Hawaii financial institution of the same type;
and
(3) Any other information that the commissioner may require.
The commissioner may require notice to be given to the public as may be deemed appropriate. The commissioner
may conduct an examination of the institution as provided under article 2, part II. The cost of any examination shall be
assessed against and paid by the institution pursuant to section 412:2- 105.
(c) The charter shall be granted only if the commissioner is satisfied that the granting of the charter will not impair the
safety or soundness of the financial institution or any other financial institution, and that the applicant meets all the
requirements set forth in this chapter for the type of financial institution for which the application has been filed. The
requirements shall include, but not be limited to, the appropriate location of offices, capital structure, business
experience, the character of its executive officers and directors, and compliance with all applicable provisions of
chapter 414. The director of commerce and consumer affairs shall not file the articles of incorporation until the
application for a charter to engage in business as a Hawaii financial institution shall have been approved by the
commissioner in writing. The commissioner may impose any restrictions and conditions on the operation of the resulting
financial institution as the commissioner deems appropriate and consistent with federal law.
(d) The conversion shall be effective upon the filing of articles of incorporation by the director of commerce and
consumer affairs after all provisions of this section and applicable federal law have been complied with in full.
Idaho §26-2139. Conversion.
A state chartered credit union may be converted into a federal credit union by complying with the following
requirements:
(a) The proposition for such conversion shall first be approved and a date set for a vote thereof by the members, either at
a meeting to be held on such date or by a written ballot to be filed on or before such date, by a majority of the board
of directors of the state chartered credit union. Written notice of the proposition and of the date set for the vote shall
be delivered in person to each member, or mailed to each member at the address for such member appearing on
the records of the credit union not more than twenty (20) nor less than five (5) days prior to such date. Approval of the
proposition for conversion shall require the majority of those votes cast in person or in writing.
(b) A statement of results of the vote verified by the affidavits of the president or vice president and the secretary shall be
filed with the director within ten (10) days after the vote is taken.
(c) Promptly after the vote is taken and in no event later than ninety (90) days thereafter if the proposition for conversion is
approved by such vote, the credit union shall take such action as may be necessary under the federal law to make it
a federal credit union, and within ten (10) days after the receipt of the federal charter, notice shall be filed with the
director that the charter has been issued.
(d) Upon ceasing to be a state chartered credit union, such credit union shall no longer be subject to any of the provisions
of this chapter.
A federally chartered credit union organized under the Federal Credit Union Act may be converted to a state chartered
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credit union by the following procedure: complying with all state requirements requisite to enabling it to meet proof of
solvency and organization as required by this chapter. When the director has been satisfied that all requirements of
this chapter have been complied with, he shall approve the organizational certificate as a state chartered credit
union as required by this chapter.
Illinois
(205 ILCS 305/64) (from Ch. 17, par. 4465)
Sec. 64. Conversion of charter.
A credit union chartered under the laws of this State may be converted to a credit union chartered under the laws of any
other state or under the laws of the United States. A credit union chartered under the laws of the United States or of any
other state may convert to a credit union chartered under the laws of this State. To effect such a conversion, a credit
union must comply with all the requirements of the jurisdiction under which it is currently chartered and such rules and
regulations as may be promulgated by the Secretary and file proof of such compliance with the Department.
Indiana IC 28-7-1-29 Conversion from federal to state charter; conversion from state to federal charter; procedures and
requirements.
Any credit union organized or reorganized under the laws of Indiana or the United States may convert from a state
charter to a federal charter or from a federal charter to a state charter as follows:
(1) A federally chartered credit union may apply for a state charter by observing the following procedures:
(A) The board of directors shall pass a resolution that the federal charter be canceled when and if a state charter is
applied for and issued to the credit union by the department of financial institutions.
(B) Written notice of the resolution shall be sent to each member at least thirty (30) days prior to the meeting in which
the resolution is to be submitted to the members.
(C) An affirmative majority vote of the members present at the meeting shall be required to effect the conversion from
federal to state charter, provided a quorum is present at the meeting.
(D) Certified copies of the minutes of the proceedings of the meeting of the members shall be filed with both the
National Credit Union Administration and the department.
(E) Not later than seventy-five (75) days after receiving the certified copies of the minutes, an examination of the
financial condition of the credit union shall be made by the department. The cost of the examination shall be paid
by the credit union.
(F) Within thirty (30) days after the completion of the examination, the department shall report to the credit union the
results of its examination and supply the National Credit Union Administration with a copy of the examination
report.
(G) If it receives a satisfactory report of the examination, the credit union must within thirty (30) days file its amended
articles of incorporation and amended bylaws pursuant to this chapter with the secretary of state, and copies of
the amended articles and amended bylaws must be directed to the department and the National Credit Union
Administration.
(H) Officers, directors, and committee members shall retain their respective offices for the unexpired terms existing prior
to the conversion, subject to the provisions of this chapter.
(I) The newly chartered credit union shall have all of the rights and privileges in and to all of the assets of the prior
existing credit union and shall assume and be responsible for all of the obligations imposed while operating under
the federal charter.
(2) A state chartered credit union may be converted into a federally chartered credit union by complying with the
following requirements:
(A) The board must adopt and approve by a majority of the directors a resolution of conversion. The proposition for
such conversion shall first be approved by a majority of the directors of the state credit union.
(B) The board must notify the membership either in person or by mail of the membership meeting at which the
resolution of conversion will be acted upon. The notice must be mailed not more than thirty (30) and not less than
seven (7) days before the meeting.
(C) The resolution must be approved by a majority of those voting, either in person or by absentee ballot, at the
membership meeting called by the board.
(D) The results of the vote, verified by the affidavits of the chairperson or vice chairperson and the secretary, shall be
filed with the department within ten (10) days after the vote is taken.
(E) If the proposition for conversion is approved, the credit union shall within ninety (90) days take the action necessary
to make it a federal credit union. Within ten (10) days after receipt of the federal charter, the credit union shall file
with the department a copy of the charter. Upon such filing, and after the credit union has notified the office of the
secretary of state that the conversion is concluded, the credit union shall cease to be a state credit union.
Iowa § 533.403 Conversion of state credit union into federal credit union.
1. A state credit union may convert into a federal credit union with the approval of the administrator of the national credit
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union administration and by the affirmative vote of a majority of the credit union’s members who vote on the proposal,
according to the provisions of section 533.203.
2. The board of directors of the state credit union shall notify the superintendent of any proposed conversion and of any
abandonment or disapproval of the conversion by the members or by the administrator of the national credit union
administration. The board of directors of the state credit union shall file with the superintendent appropriate evidence of
approval of the conversion by the administrator of the national credit union administration and shall notify the
superintendent of the date on which the conversion is to be effective.
3. Upon receipt of satisfactory proof that the state credit union has complied with all applicable laws of this state and of
the United States, the superintendent shall issue a certificate of conversion which shall be filed and recorded in the
county in which the state credit union has its principal place of business and in the county in which its original articles of
incorporation were filed and recorded.
Kansas
§ 17-2222: Conversion from state to federal credit union.
A credit union organized under K.S.A. 17-2201 to 17-2221, both sections inclusive, and acts amendatory thereof and
supplemental thereto, may be converted into a federal credit union by complying with the following requirements:
(a) The proposition for such conversion shall first be approved by a majority of the directors of the credit union. The
proposition then shall be submitted to a vote of its members, the notice of which shall be in writing and shall be
delivered in person to each member, or shall be mailed to each member at the address for such member appearing
on the records of the credit union, not more than 30 nor less than seven days prior to the time of the vote. Approval of
the proposition for conversion shall be by the affirmative vote of a majority of the members voting on the proposition.
(b) A copy of a statement of the results of the vote, verified by the affidavits of the executive officer of the board and the
secretary of the board, shall be filed with the administrator within 10 days after the vote.
(c) Promptly after the vote is taken and in no event later than 90 days after such vote, the credit union shall take such
action as may be necessary under the federal credit union act to make it a federal credit union, and within 10 days
after receipt of the federal credit union charter there shall be filed with the administrator a copy of the charter thus
issued. Upon such filing the credit union shall cease to be a state credit union.
(d) Upon ceasing to be a state credit union, such credit union shall no longer be subject to any of the provisions of the
state law under which the credit union was organized. The successor federal credit union shall be vested with all of the
assets and shall continue responsible for all of the obligations of the state credit union to the same extent as though
the conversion had not taken place.
Kentucky § 286.6-715. Conversion of credit union.
(1) A credit union incorporated under the laws of this state may be converted to a credit union organized under the laws
of any other state or under the laws of the United States, subject to regulations issued by the commissioner.
(2) A credit union organized under the laws of the United States or of any other state may convert to a credit union
incorporated under the laws of this state. To effect such a conversion, a credit union must comply with all the
requirements of the jurisdiction under which it was originally organized and the requirements of the commissioner and
file proof of such compliance with said commissioner.
Louisiana §667. Conversion from federal to state and from state to federal credit union; division of assets.
A.(1) A federal credit union may be converted into a state credit union under this Chapter by (a) complying with all the
federal requirements requisite to enabling it to convert to a credit union under this Chapter or to cease being a
federal credit union, (b) filing with the commissioner proof of such compliance, satisfactory to the commissioner,
and (c) filing with the commissioner an act of incorporation as provided for in R.S. 6:641.
(2) When the commissioner has been satisfied that all of the requirements, and all other requirements of this Chapter,
have been complied with, the commissioner shall approve the act of incorporation. Upon such approval the
federal credit union shall become a credit union under this Chapter as of the date it ceases to be a federal credit
union. The credit union under this Chapter shall be vested with all of the assets and shall continue responsible for all
of the obligations of the federal credit union to the same extent as though the conversion had not taken place.
B. A credit union organized under this Chapter may be converted into a federal credit union by complying with the
following requirements:
(1) The proposition for such conversion shall first be approved, and a date set for a vote thereon by the members
(either at a meeting to be held on such date or by written ballot to be filed on or before such date), by a majority of
the directors of the credit union. Written notice of the proposition and of the date set for the vote shall then be
delivered in person to each member, or mailed to each member at the address for such member appearing on the
records of the credit union, not more than thirty nor less than seven days prior to such date. Approval of the
proposition for conversion shall be by the affirmative vote of a majority of the members, in person or in writing.
(2) A statement of the results of the vote, verified by the affidavits of the president or vice-president, and the secretary,
shall be filed with the commissioner within ten days after the vote is taken.
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(3) Promptly after the vote is taken and in no event later than ninety days thereafter, if the proposition for conversion
was approved by such vote, the credit union shall take such action as may be necessary under the applicable
federal law to make it a federal credit union, and within ten days after receipt of the federal credit union charter
there shall be filed with the commissioner a copy of the charter thus issued. Upon such filing the credit union shall
cease to be a credit union organized under this Chapter.
(4) Upon ceasing to be a credit union organized under this Chapter, such credit union shall no longer be subject to any
of the provisions of this Chapter. The successor federal credit union shall be vested with all of the assets and shall
continue responsible for all the obligations of the credit union organized under this Chapter to the same extent as
though the conversion had not taken place.
C.(1) This subsection prescribes the procedure that will enable members of a credit union organized under this chapter
who are a separately identifiable group to undertake an equitable division of their assets, liabilities and capital and
charter a new credit union.
(2) A credit union may undertake an equitable division of its assets, liabilities and capital when:
(a) A group of persons within the field of membership of the credit union constitutes a separately identifiable group
which is eligible for a credit union charter;
(b) A sufficient number of those in the separately identifiable group have authorized transfer of their share and loan
accounts to justify the division; and
(c) The other requirements of the law are met.
(3) Upon the board of directors approval of a proposition for the credit union to divide its assets, liabilities and capital
between itself and a credit union to be organized to serve persons in a separately identifiable group with the existing
credit union's field of membership, the board shall:
(a) Appoint a committee of at least three members of the said group to assist in the preparation and execution of a
plan for division and to subscribe to articles of incorporation for the proposed new credit union; and
(b) Promptly notify the commissioner of financial institutions of these actions.
(4) The board of directors shall prepare a plan for division which shall provide that:
(a) The members within the separately identifiable group shall have the option to be exercised in writing by a
specified date, of (i) authorizing the transfer of their accounts to the new credit union upon approval of its
charter by the commissioner of financial institutions, or (ii) maintaining their accounts in the existing credit union,
provided, however, the bylaws of the existing credit union would permit such retention.
(b) The remaining assets, liabilities and capital will be equitably divided; and
(c) The records will be closed and the division effected by a specified date, subsequent to but no later than six
months after the date set for members to exercise their options as specified in this subparagraph.
(5) The board of directors shall give written notice of the options set forth in Paragraph (4) to each person who would
be eligible for membership in the proposed new credit union. The written notice shall contain a summary of the plan
and a form for confirmation of account balances and authorization for transfer of accounts. If authorization is given
to transfer an account, it shall be valid for six months from the date fixed for the exercise of the option.
(6) If a number of members, sufficient to make the division reasonable and feasible, have authorized the transfer of their
accounts by the date fixed for exercising the option to transfer, the board of directors shall submit the following
information to the commissioner of financial institutions:
(a) A copy of the plan for division of assets, liabilities and capital;
(b) A current financial and statistical report;
(c) A certification of acceptance of option to transfer shares and loans; summarizing the result of the notice of
option to transfer; and
(d) A schedule of the share and loan balances of all members who authorized the transfer of their accounts.
(7) An examiner will make the necessary investigation. If requirements are met and the plan appears acceptable, the
examiner will assist in holding the charter-organization meeting and completing the required forms.
(8) If the commissioner of financial institutions finds that the plan for division complies with this and other parts of this
chapter, he will approve the plan and authorize the board of directors of the existing credit union to present the
proposal to the members for approval at an annual or special meeting as provided in Paragraph (9).
(9)(a) If the commissioner of financial institutions approves the plan for division, it may be submitted to the members at
an annual meeting, if one is to be held at a time which will assure consummation of the plan within six months after
the expiration of the option to transfer, or at a special meeting to be called as provided in the bylaws and held
within the six month period.
(b) The notice of the meeting shall:
(i) be given to each member of the credit union;
(ii) state that one of the purposes of the meeting is to vote on the proposed plan;
(iii) advise the members of the reasons for the proposal, the fact that the commissioner of financial institutions has
given his approval, the number of eligible members who have authorized the transfer of their accounts, and
the membership vote required for approval; and
(iv) be accompanied by a copy of the plan for division of assets, liabilities and capital.
(c) A majority of the members present and voting at the meeting must approve the plan in order for the board of
directors to proceed with the division.
(d) The board of directors will promptly certify the results of the membership vote to the commissioner of financial
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institutions.
(10)(a) If the plan was approved by the members of the existing credit union as provided in Paragraph (9), the
commissioner of financial institutions will issue the charter to the new credit union.
(b) The division will be completed as of the date specified in the plan. Upon completion of the division, the new
credit union will be vested with all assets received and will be responsible for all liabilities and capital assumed.
(c) The boards of directors for both credit unions will promptly certify the completion of the division to the
commissioner of financial institutions. Financial and statistical reports for both credit unions, before and after the
division, will accompany the certification.
Maine §873. Conversion: federal to State charter; out of state to State charter.
1. Eligibility. A credit union organized pursuant to provisions of federal law or organized under the laws of another state
may become subject to this Part and receive a charter as a state-chartered credit union by making application in
writing to the superintendent for such conversion. The superintendent may approve or disapprove such conversion in
accordance with the criteria set forth in section 253 as long as, as a condition precedent to such approval, the credit
union shows compliance with all applicable federal laws and regulations and laws and regulations of the state under
which it is organized relating to such conversion.
2. Issuance of charter. Upon receiving approval from the superintendent, the credit union must be issued a charter under
this Part, which fact must be certified by the superintendent to the Secretary of State; and, from and after the issuance
of such charter, the credit union must be subject to the provisions of this Part and all rules issued under this Part.
3. Applicability of other sections. A credit union converting to a state charter pursuant to this section is subject to the
provisions contained in sections 357 and 358 governing resulting institutions.
§874. Conversion: State to federal charter.
A credit union organized under the general or special laws of this State may convert to a federally chartered credit union.
The credit union must notify and provide the superintendent with a copy of the application filed with the National Credit
Union Administration within 3 days of filing with the National Credit Union Administration. Approval of the members of the
credit union for the conversion must be obtained in the manner set forth in section 342, subsection 6. Upon obtaining the
approval, the credit union shall provide to the superintendent all necessary approvals and charters required by the
National Credit Union Administration and all federal laws and regulations applicable to the conversion. The
superintendent shall notify the Secretary of State that the conversion has been effected. A copy of the approval or
charter must accompany the notification.
§875. Conversion: change in type of state charter.
A credit union subject to the laws of this State may convert its charter to do business as a credit union into a charter to do
business as a financial institution organized under chapter 32 if any plan of conversion authorized by this section is
adopted and approved in accordance with the requirements of section 343.
Maryland
§ 6-801. Conversion of State credit union into federal credit union.
(a) General rule. -- Any State credit union may convert into a federal credit union as provided by federal law and as
provided in this section.
(b) Director's action. -- A majority of the board of a credit union proposing to convert shall:
(1) Adopt a resolution that declares that the conversion is advisable;
(2) Set a date for a vote on the proposed conversion by the members of the credit union at an annual or special
meeting of the members or by mail ballot to be filed on or before that date;
(3) Comply with federal law regarding conversion; and
(4) File the required conversion application with the Commissioner.
(c) Voting methods. -- The Commissioner, at the request of the board, may:
(1) Waive the vote of the members; and
(2) Substitute any reasonable method of determining the approval by the members.
(d) Notice to members. -- Unless the Commissioner takes action under subsection (c) of this section, written notice of the
proposed conversion and of the date set for the vote shall be delivered in person to each member or mailed to each
member at the member's address as recorded by the credit union, not more than 30 days nor less than 7 days before
the date set for the vote.
(e) Approval by members. --
(1) Unless the Commissioner takes action under subsection (c) of this section, the proposed conversion shall be
approved by the affirmative vote of a majority of the members who vote on the proposal.
(2) Within 10 days after the vote, a statement of the results of the vote shall be filed with the Commissioner. The
statement shall be verified by the chairman or vice chairman of the board and by the secretary of the credit union.
(f) Compliance with federal law; filing federal charter. --
(1) Within 90 days after a proposed conversion is approved by the members, the credit union shall take any action
necessary under federal law to make it a federal credit union.
(2) Within 10 days after the credit union receives a federal credit union charter, a copy of that charter shall be filed with
the Commissioner and, when the copy is filed, the credit union ceases to be a State credit union.
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(g) Effect of conversion. -- When the conversion from a State credit union to a federal credit union is complete:
(1) The converted credit union is no longer subject to the provisions of this title; and
(2) The successor federal credit union owns all the assets and is responsible for all the obligations of the former State
credit union as though the conversion had not taken place.
§ 6-802. Conversion of foreign credit union into State credit union.
(a) General rule. -- Any credit union organized under the laws of any other state or of the United States may convert to a
State credit union as provided in this section.
(b) Requirements to be met. -- A credit union proposing to convert shall meet:
(1) All of the requirements of this title for the incorporation of a credit union in this State; and
(2) All of the requirements of the Commissioner, including any specific conditions that a credit union must meet in order
to convert.
(c) Director's action. -- A majority of the board of a credit union proposing to convert shall:
(1) Adopt a resolution that declares that the conversion is advisable; and
(2) Set a date for a vote on the proposed conversion by the members at an annual or special meeting of the
members or by mail ballot to be filed on or before that date.
(d) Voting methods. -- The Commissioner, at the request of the board, may:
(1) Waive the vote of the members; and
(2) Substitute any reasonable method of determining the approval by the members.
(e) Notice to members. -- Unless the Commissioner takes action under subsection (d) of this section, written notice of the
proposed conversion and of the date set for the vote shall be delivered in person to each member or mailed to each
member at the member's address as recorded by the credit union, not more than 30 days nor less than 7 days before
the date set for the vote.
(f) Approval by members. --
(1) Unless the Commissioner takes action under subsection (d) of this section, the proposed conversion shall be
approved by the affirmative vote of a majority of the members who vote on the proposal.
(2) Within 10 days after the vote, a statement of the results of the vote shall be filed with the Commissioner. The
statement shall be verified by the chairman or vice chairman of the board and the secretary of the credit union.
(g) Conversion. --
(1) A credit union may convert to a State credit union if:
(i) The converted credit union:
1. Meets the common bond requirements of the proposed field of membership type; and
2. Files with the Commissioner an application and any other documents that the Commissioner deems necessary
to make a determination; and
(ii) The Commissioner determines that the conversion:
1. Is in the best interest of the existing and proposed membership;
2. Will likely result in better service to the existing membership;
3. Is in accordance with sound credit union practices; and
4. Does not expose the funds of the existing members to unnecessary risk.
(2) Unless the Commissioner notifies the credit union that a different time period is necessary, within 120 days after the
application is filed, the Commissioner shall notify the credit union of the determination on the application.
(h) Effect of conversion. -- When the conversion is complete, the successor credit union owns all of the assets and is
responsible for all the obligations of the credit union as though the conversion had not taken place.
Massachusetts Chapter 171, Section 80A. Conversion of credit union into mutual savings bank, mutual co-operative bank, mutual federal
savings bank or mutual federal savings and loan association.
(a) A credit union subject to this section may convert into a mutual savings bank governed by chapter 168, a mutual co-
operative bank governed by chapter 170, a mutual federal savings bank or a mutual federal savings and loans
association which exist under authority of the United States. The conversion shall comply with all applicable federal
laws and regulations. A credit union insured by the Massachusetts Credit Union Share Insurance Corporation shall file
notification of its intent to convert with said corporation at least 90 days before the date of the proposed special
meeting of the members of the credit union. No credit union may convert pursuant to this section so long as any
financial assistance provided by said corporation to such credit union remains unpaid or has not been compromised
or settled. Any such repayment, compromise or settlement shall be approved by the commissioner.
(b) A credit union shall file with the commissioner, at the same time, notices, disclosures and communications required by
or sent to the National Credit Union Administration or a regional director. The commissioner may require changes and
additions to notice, disclosure or communication, except as required by federal law or regulation.
(c) A credit union that is adequately capitalized and has received at least a satisfactory rating in its most recent
examination for compliance with the Community Reinvestment Act may submit a plan of conversion approved by a
2/3 vote of the entire board of directors to the commissioner. Unless waived by the commissioner, the plan shall
include but not be limited to:
(1) a 3 year business plan for the appropriate chartered bank which shall include pro forma financial statements for the
mutual bank;
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(2) a commitment by the converting credit union that it will not convert to a stock form before the expiration of 1 year
of the effective date of the conversion to a mutual bank charter;
(3) an estimated budget for conversion expenses;
(4) financial statements for the most recently completed quarter;
(5) if applicable, the procedures and timing for termination of excess deposit insurance from the Massachusetts Credit
Union Share Insurance Corporation; and
(6) other relevant information that the commissioner may reasonably require.
(d) Included with the plan shall be an information statement to be sent to members which shall fully and fairly disclose all
significant terms and steps to be taken for the conversion and shall include but not be limited to:
(1) a statement as to why the board is considering the conversion;
(2) a statement of the major positive and negative business effects of the proposed conversion;
(3) the impact on the member’s financial and other interests in the credit union;
(4) a disclosure that the conversion from a credit union to a mutual bank could lead to a member losing ownership
interest in the credit union if the mutual bank subsequently converts to a stock institution and the member does
not become a stockholder; and
(5) a disclosure of any conversion related economic benefit a director or senior management official may receive
including receipt of or an increase in compensation and an explanation of any foreseeable stock related benefits
associated with a subsequent conversion to a stock institution; the explanation of stock related benefits shall
include a comparison of the opportunities to acquire stock that are available to officials and employees, with
those opportunities available to the general membership.
(e) A converting credit union shall file with the commissioner a plan of conversion and an information statement at least
120 days before the date of the proposed special meeting of the members. The commissioner may require reasonable
changes to the plan of conversion and information statement. The commissioner may also require any equitable
disclosure he determines applicable to the proposed conversion to a mutual bank transaction. The commissioner may
specify the form, type and other material aspects of the plan of conversion and information statement to be sent to
members, except to the extent that it does not conflict with federal law or regulation.
(f) The commissioner shall review the contents of the plan before the credit union board presents the conversion plan to
the members for a vote. The commissioner shall authorize the distribution of the conversion plan and information
statement only if the commissioner is satisfied of all of the following:
(1) the plan discloses to the members information concerning the advantages and disadvantages of the proposed
conversion;
(2) the information statement discloses the impact on the member’s financial and other interests in the credit union;
and
(3) the conversion would not be made to circumvent a pending supervisory action that is initiated by the commissioner
or other regulatory agency because of a concern over the safety and soundness of the credit union.
(g) The commissioner shall render a decision within 30 days from the date of the filing of the plan or any amendment thereof.
Upon authorization by the commissioner of the distribution of the contents of the conversion plan and information
statement, the credit union shall call a special meeting of the members to vote on the conversion plan. At least 30 days
before the special meeting, the credit union shall mail to each member a notice of the special meeting, the conversion
plan and information statement.
(h) The plan of conversion shall be approved by a majority vote of those members voting. A member may vote on the
proposal to convert in person at the special meeting held on the date set for the vote or by written ballot filed by the
member. The vote on the conversion proposal shall be by secret ballot and conducted by an independent entity. The
independent entity shall be a company with experience in conducting corporate elections. A director or officer of the
credit union, or an immediate family member of a director or officer, shall not have an ownership interest in, or be
employed by, the entity.
(i) A credit union or an officer or director thereof shall not directly or indirectly give or offer or provide a chance to win a
lottery or anything of substantial value, as determined by the commissioner, to the membership or a member of the
credit union for an action related to the conversion to a mutual bank or as an inducement to vote on the plan of
conversion.
(j) The provisions on notice to members and voting procedures in this section shall govern the process for converting to a
mutual bank notwithstanding other provisions of this chapter or a by-law of the converting credit union to the contrary.
(k) Certified copies of the results of the board and membership meetings of the credit union shall be filed with the
commissioner. The credit union shall also certify that the information statement, plan, and other written materials
provided to members were identical to those materials considered satisfactory by the commissioner.
(l) If the commissioner disapproves of the methods by which the membership vote was taken or the procedures
applicable to the vote, the commissioner may direct that a new vote be taken. If the commissioner does not
disapprove of the methods by which the membership vote was taken within 10 days after the notification is given, the
vote shall be considered approved.
(m) If the conversion to a mutual savings bank or a mutual co-operative bank is approved by the members and the
commissioner receives notification from the converting credit union that approvals required under state and federal
law and regulations, including approvals needed for deposit insurance by the Federal Deposit Insurance Corporation
have been obtained, and that any waiting period prescribed by federal law has expired, or in the case of conversion
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to a mutual savings bank, it will become a member of the Depositors Insurance Fund and of the deposit insurance fund
thereof and has made all applicable payments thereto as determined by the commissioner, or in the case of
conversion to a mutual co-operative bank it shall become a member of The Co-operative Central Bank and of the
share insurance fund thereof and has made all applicable payments thereto as determined by the commissioner, a
certificate to transact business shall be issued by the commissioner as applicable. A conversion to a state chartered
savings bank or a state chartered co-operative bank under this section shall not be consummated until arrangements
satisfactory to the Depositors Insurance Fund or The Co-operative Central Bank have been made and notice thereof
has been received by the commissioner. After receipt of the certificate to transact business, the converting credit
union shall promptly file the certificate and its articles of organization with the secretary of state. Upon the filing, the
charter of the converting credit union shall automatically cease and the converting credit union shall cease to be a
credit union and shall become a mutual savings bank or a mutual co-operative bank. Upon the conversion, the
converted mutual bank shall possess all of the rights, privileges and powers granted to it by its articles of organization
and by the laws applicable to the type of mutual bank charter into which it converted, and all of the assets and
business of the converting credit union shall be transferred to and vested in it without any deed or instrument of
conveyance; but the converting credit union may execute a deed or instrument of conveyance as is convenient to
confirm the transfer. The converted mutual bank shall be subject to all of the duties, relations, obligations and liabilities
of the converting credit union, whether as debtor, depository or otherwise, and shall be liable to pay and discharge
the debts and liabilities, to perform all the duties in the same manner and to the same extent as if the converted
mutual bank had itself incurred the obligation or liability or assumed the duty or relation. Rights of credits of the
converting credit union and liens upon the property of such credit union shall be preserved unimpaired and the
converted mutual bank shall be entitled to receive, accept, collect, hold and enjoy all gifts, bequests, devises,
conveyances and appointments in favor of or in the name of the converting credit union and whether made or
created to take effect before or after the conversion.
(n) If the conversion to a mutual federal savings bank or a mutual federal savings and loan association is approved by the
members the converting credit union shall provide notification to the commissioner that all approvals under state and
federal law and regulations including approvals needed for deposit insurance by the Federal Deposit Insurance
Corporation have been obtained and that any waiting period prescribed by federal law has expired and shall provide
a certified copy of the approval of the federal mutual charter by the Office of Thrift Supervision or any successor
agency thereto. Upon acceptance of the federal charter, the converting credit union’s charter from the
commonwealth shall cease to exist.
(o) A person who willfully violates the disclosure provisions of this section knowing the disclosure made to be false or
misleading in a material respect shall upon conviction be fined not more than $5,000 or imprisoned not more than 3
years, or both.
Section 80B. Credit union chartered in commonwealth converted to federal charter.
(a) A credit union chartered in the commonwealth may convert, subject to this section, into a credit union chartered
under applicable federal law and regulations upon the affirmative vote of a majority of the members of the credit
union voting on the proposal.
(b) The board of directors of a credit union chartered in the commonwealth, by an affirmative vote of two-thirds of the
entire board, may approve a plan of conversion and submit the plan to the commissioner for his review. Included with
the plan shall be an information statement to be sent to members which shall fully and fairly disclose all significant
terms and steps to be taken for the conversion and shall include but not be limited to the following:—
(1) a statement as to why the board of directors is considering the conversion;
(2) a statement of the major positive and negative business effects of the proposed conversion; and
(3) the impact on the member’s financial and other interests in the credit union.
(c) The commissioner shall review the contents of the plan before the credit union board of directors presents the
conversion plan to the members for a vote. The commissioner may require changes to the plan of conversion and
information statement. The commissioner may also require an equitable disclosure if he determines such disclosure is
applicable to the transaction. The commissioner may specify the form, type and other material aspects of the plan of
reorganization and information statement to be sent to members. The commissioner shall approve the contents of the
conversion plan and information statement only if the commissioner is satisfied that the following elements have been
met:—
(1) the plan discloses to the members information concerning the advantages and disadvantages of the proposed
conversion;
(2) the information statement discloses the impact on the member’s financial and other interests in the credit union;
and
(3) the conversion would not be made to circumvent a pending supervisory action that is initiated by the commissioner
or other regulatory agency because of a concern over the safety and soundness of the credit union.
(d) Upon approval of the contents of the conversion plan and information statement by the commissioner, the credit
union shall call a special meeting of its members to vote on the conversion plan. At least 14 days before the meeting,
the credit union shall mail to each member a notice of the meeting, the conversion plan and information statement.
(e) Certified copies of records of all proceedings held by the board of directors and members of the credit union shall be
filed with the commissioner. In addition, the credit union shall furnish a certified copy of consent or approval of the
federal regulatory authority to the commissioner. Upon acceptance of the federal charter, the credit union’s charter
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from the commonwealth shall terminate.
(f) A person who willfully violates the disclosure provisions of this section knowing such disclosure made to be false or
misleading in any material respect shall be punished by a fine of not more than $5,000 or by imprisonment for not more
than 3 years, or both.
Michigan § 490.372. Conversion of domestic credit union into foreign credit union.
(1) A domestic credit union may convert into a foreign credit union under this section if all of the following are met:
(a) At least 30 days before voting on a plan of conversion under subdivision (b), the credit union board gives written
notice to the credit union's members that it is considering a conversion. The credit union board shall mail the notice
to the credit union's members and shall not include any other mailing with the notice. The notice shall include all of
the following:
(i) A brief statement of why the credit union board is considering the conversion.
(ii) A brief statement of the major positive and negative effects of the proposed conversion.
(iii) A request for members' written comments on the proposed conversion.
(b) The credit union board approves of a plan of conversion and files the plan of conversion with the commissioner. An
affirmative vote of 2/3 of the entire credit union board is required to approve a plan of conversion. The plan of
conversion shall meet all of the following:
(i) The conversion plan discloses to the members information concerning the advantages and disadvantages of
the proposed conversion and contains a statement indicating any material differences in powers of the
converted credit union.
(ii) The conversion is not intended to circumvent a pending supervisory action initiated by the commissioner or
another regulatory agency because of a concern over the safety and soundness of the credit union.
(iii) The converted credit union is likely to be economically viable.
(c) The members of the credit union approve of the plan of conversion by a 2/3 vote of the members voting on the
plan. Subject to subsection (2), a member may vote at a special meeting called to vote on the plan of conversion
or by mail ballot. Before the vote, the credit union board shall call a special meeting of the members to provide
information on the plan. At least 14 days before the meeting, the credit union board shall mail to each member a
notice of the meeting and a ballot with a postage paid return envelope. The notice shall state the date, at least 15
days following the meeting, by which the member must return the ballot and the methods permitted for casting a
vote, describe briefly the reasons for and the major positive and negative effects of the conversion, and state how
members may obtain copies of the conversion plan. The credit union board shall count the votes cast by members
upon the expiration of the time given to the members to return their ballots.
(d) The credit union files with the commissioner copies of member comments submitted to the credit union under
subdivision (a)(iii) and certified copies of records of all proceedings held by the credit union board and members of
the credit union.
(e) If required by the laws of the applicable jurisdiction, the credit union files with the commissioner a certified copy of
the consent or approval of the appropriate regulatory authority with jurisdiction over foreign credit unions
chartered by that authority.
(2) If the commissioner approves of the method before the vote, the credit union board may establish an alternative
method for accepting votes from members of a converting domestic credit union on the plan of conversion under
subsection (1)(c) if the alternative method is reasonably calculated to ensure each member has an opportunity to
vote.
(3) If all of the conditions required by this section are met and the commissioner determines that any notices to members
were accurate, timely, and not misleading, and that conduct of the vote on the conversion plan was fair and lawful,
the commissioner shall approve the conversion and the conversion is effective.
§ 490.373. Conversion of domestic credit union into mutual savings bank or mutual savings association.
(1) A domestic credit union may convert into a mutual savings bank or mutual savings association if all of the following are
met:
(a) At least 30 days before voting on a plan of conversion under subdivision (b), the credit union board gives written
notice to the credit union's members that it is considering a conversion. The credit union board shall mail the notice
to the credit union's members and shall not include any other mailing with the notice. The notice shall include all of
the following:
(i) A brief statement of why the credit union board is considering the conversion.
(ii) A brief statement of the major positive and negative effects of the proposed conversion.
(iii) A request for members' written comments on the proposed conversion.
(b) The credit union board approves of a plan of conversion and files the plan of conversion with the commissioner.
An affirmative vote of 2/3 of the entire credit union board is required to approve a plan of conversion. The plan of
conversion shall meet all of the following:
(i) The conversion plan discloses to the members information concerning the advantages and disadvantages of
the proposed conversion and contains a statement indicating any material differences in powers between a
credit union and a mutual savings bank or mutual savings association.
(ii) The conversion is not intended to circumvent a pending supervisory action initiated by the commissioner or
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another regulatory agency because of a concern over the safety and soundness of the credit union.
(iii) The conversion plan does not provide any official of the converting credit union with any remuneration or other
economic benefit in connection with the conversion.
(iv) After conversion, the mutual savings bank or mutual savings association is likely to be economically viable.
(c) The credit union board shall call a special meeting of the members to vote on the conversion plan and mail to
each member notice of the meeting and proposed conversion 90 days before the date of the special meeting.
The notice shall include all of the following:
(i) A summary of the positive and negative effects of the proposed conversion.
(ii) A statement that the officials will not receive any remuneration or other economic benefit in connection with the
conversion of the domestic credit union.
(iii) A statement that any interested person may obtain more detailed information about the conversion from the
domestic credit union at its principal place of business, or by any method approved in advance by the
commissioner.
(iv) A statement that the credit union board may substantively amend the proposed plan of conversion before the
special meeting based on comments from regulatory authorities or any other reason and that the credit union
board may terminate the proposed plan of conversion.
(v) Instructions for obtaining a copy of the conversion plan.
(vi) The date of the special meeting and a statement that the vote on the conversion will close on that date.
(vii) Any other information required by the commissioner.
(d) At least 60 days before the special meeting described in subdivision (c), the credit union board posts a copy of the
notice required in subdivision (c) in each branch, service center, or other location in this state where members may
transact business with the credit union, in at least 12-point type, displayed prominently in an area visible to members
before they transact business.
(e) At least 60 days before the special meeting described in subdivision (c), if the credit union conducts any member
transactions through the use of an internet website, the credit union board displays the information included in the
notice required in subdivision (c) in a conspicuous location on that website.
(f) Thirty days before the special meeting of the members, the credit union board mails a notice of the meeting and
proposed conversion. The notice shall include all of the information described in subdivision (c) for the 90-day notice
and shall include the date, time, and place of the special member meeting, a ballot and postage-paid return
envelope, and a summary of the methods permitted for casting votes.
(g) If the plan of conversion is substantively amended by the credit union board, at least 30 days before the vote of the
members on the plan the credit union board shall mail a notice to each member. The notice shall contain the
information concerning the amended plan of conversion described in subdivision (c) for a notice under that
subdivision.
(h) At a special meeting of members, the members, by a 2/3 vote of members voting, approve of the conversion and
the plan of conversion. A member may vote in person or by mail. With the prior approval of the commissioner, a
domestic credit union may accept member votes by an alternative method that is reasonably calculated to ensure
each member has an opportunity to vote.
(i) The domestic credit union files with the commissioner all of the following:
(i) Certified copies of records of all proceedings held by the credit union board and members of the domestic
credit union.
(ii) Copies of member comments submitted to the domestic credit union under subdivision (a)(iii).
(iii) If that consent or approval is required, a certified copy of the consent or approval of any state or federal
regulatory authority with jurisdiction over the mutual savings bank or mutual savings association after the
conversion and, if a holding company is to be formed in connection with the conversion, the regulations of the
federal reserve board of governors or of the office of thrift supervision applicable to holding companies.
(iv) Verification that deposits in the converted mutual savings bank or mutual savings association qualify for federal
insurance.
(2) If the requirements of this section are met and the commissioner determines that the notices to members were
accurate, timely, and not misleading, and that conduct of the vote on the conversion plan was fair and lawful, the
commissioner shall approve the conversion and the conversion is effective.
(3) Except as otherwise required by the commissioner, this section does not apply to a domestic credit union that
submitted to the commissioner a plan of conversion into a mutual savings bank or mutual savings association before
the effective date of this act.
§ 490.374. Conversion of domestic credit union into bank, stock savings bank, or stock savings and loan association.
(1) A domestic credit union may convert into a bank, stock savings bank, or stock savings and loan association if all of the
following are met:
(a) At least 30 days before voting on a plan of conversion under subdivision (b), the credit union board gives written
notice to the credit union's members that it is considering a conversion. The credit union board shall mail the notice
to the credit union's members and shall not include any other mailing with the notice. The notice shall include all of
the following:
(i) A brief statement of why the credit union board is considering the conversion.
(ii) A brief statement of the major positive and negative effects of the proposed conversion.
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(iii) A complete and accurate description of the differences between a credit union and a bank, stock savings
bank, or stock savings and loan association, as appropriate.
(iv) A request for members' written comments on the proposed conversion.
(b) By an affirmative vote of 2/3 of the entire credit union board, the credit union board approves of a plan of
conversion and files the plan of conversion with the commissioner. The conversion plan shall include all of the
following:
(i) The member eligibility record date and the subscription offering priority established in connection with any
proposed stock offering.
(ii) A business plan, including a detailed discussion of how the capital acquired in the conversion will be used,
expected earnings for at least a 3-year period following the conversion, and a justification for any proposed
stock repurchases.
(iii) A full appraisal report, prepared by an independent appraiser, of the value of the credit union and the pricing
of the stock to be sold in the conversion transaction.
(iv) A legal opinion that any proposed stock offering complies with state and federal law.
(v) Copies of notices to be provided to members under subdivisions (d) and (e).
(c) The commissioner grants preliminary approval of the plan of conversion approved by the credit union board. The
commissioner shall review the contents of the plan and member comments on the plan and grant preliminary
approval of the plan if the commissioner is satisfied of all of the following:
(i) The conversion plan discloses to the members information concerning the advantages and disadvantages of
the proposed conversion, contains a complete and accurate description of the differences between a credit
union and a bank, stock savings bank, or stock savings and loan association, as appropriate, and contains a
statement indicating any material differences in powers between a credit union and a bank, stock savings
bank, or stock savings and loan association, as appropriate.
(ii) The conversion is not intended to circumvent a pending supervisory action initiated by the commissioner or
another regulatory agency because of a concern over the safety and soundness of the credit union.
(iii) The conversion plan does not provide any official of the converting credit union with any remuneration or other
economic benefit in connection with the conversion.
(iv) The conversion plan does not permit the converting credit union to loan funds or otherwise extend credit to any
person to purchase the capital stock of the bank, stock savings bank, or stock savings and loan association.
(v) After conversion, the bank, stock savings bank, or stock savings and loan association is likely to be economically
viable.
(d) If the commissioner grants preliminary approval under subdivision (c), the credit union board shall call a special
meeting of the members to vote on the conversion plan and mail to each member notice of the meeting and
proposed conversion 90 days before the date of the special meeting. The notice shall include all of the following:
(i) A summary of the positive and negative effects of the proposed conversion.
(ii) A statement that the officials will not receive any remuneration or other economic benefit in connection with
the conversion of the domestic credit union.
(iii) A statement that any interested person may obtain more detailed information about the conversion from the
domestic credit union at its principal place of business, or by any method approved in advance by the
commissioner.
(iv) If the conversion plan includes a distribution of a portion of the credit union's net worth to members, a
statement describing the amount of the distribution, the form of the distribution, and eligibility requirements to
receive a distribution.
(v) The par value and approximate number of shares of capital stock to be issued and sold under the proposed
plan of conversion.
(vi) A statement that savings and share account holders will continue to hold accounts in the converted bank,
stock savings bank, or stock savings and loan association identical as to dollar amount and general terms, and
that their accounts will continue to be insured.
(vii) A statement that borrowers' loans will be unaffected by conversion, and that the amount, rate, maturity,
security, and other conditions will remain contractually fixed as they existed before conversion.
(viii) A statement that the credit union board may substantively amend the proposed plan of conversion before
the special meeting based on comments from regulatory authorities or any other reason and that the credit
union board may terminate the proposed plan of conversion.
(ix) Instructions for obtaining a copy of the conversion plan.
(x) The date of the special meeting and a statement that the vote on the conversion will close on that date.
(xi) Any other information required by the commissioner.
(e) At least 60 days before the special meeting described in subdivision (d), the credit union board posts a copy of the
notice required in subdivision (d) in each branch, service center, or other location in this state where members may
transact business with the credit union, in at least 12-point type, displayed prominently in an area visible to
members before they transact business.
(f) At least 60 days before the special meeting described in subdivision (d), if the credit union conducts any member
transactions through the use of an internet website, the credit union board displays the information included in the
notice required in subdivision (d) in a conspicuous location on that website.
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(g) Thirty days before the special meeting of the members, the credit union board mails a notice of the meeting and
proposed conversion to the members. The notice shall include all of the information described in subdivision (d) for
the 90-day notice and shall include the date, time, and place of the special member meeting, a ballot and
postage-paid return envelope, and a summary of the methods permitted for casting votes.
(h) If the plan of conversion is substantively amended by the credit union board, at least 30 days before the vote of the
members on the plan the credit union board shall mail a notice to each member. The notice shall contain the
information concerning the amended plan of conversion described in subdivision (d) for a notice under that
subdivision.
(i) At a special meeting of members, the members, by a 2/3 vote of members voting, approve of the conversion and
the plan of conversion. A member may vote in person or by mail. With the prior approval of the commissioner, a
domestic credit union may accept member votes by an alternative method that is reasonably calculated to
ensure each member has an opportunity to vote.
(j) The domestic credit union files with the commissioner all of the following:
(i) Certified copies of records of all proceedings held by the credit union board and members of the domestic
credit union.
(ii) Copies of member comments submitted to the domestic credit union under subdivision (a)(iii).
(iii) If that consent or approval is required, a certified copy of the consent or approval of any state or federal
regulatory authority with jurisdiction over the bank, stock savings bank, or stock savings and loan association
after the conversion and, if a holding company is to be formed in connection with the conversion, the
regulations of the federal reserve board of governors or of the office of thrift supervision applicable to holding
companies.
(iv) Verification that deposits in the converted bank, stock savings bank, or stock savings and loan association
qualify for federal insurance.
(2) If the requirements of this section and the regulations of the federal agency providing federal deposit insurance
regarding mutual-to-stock conversions are met, and the commissioner determines that the notices to members were
accurate, timely, and not misleading, and that conduct of the vote on the conversion plan was fair and lawful, the
commissioner shall approve the conversion and the conversion is effective.
§ 490.375. Rights, obligations, relationships, and trusts of converting credit union.
(1) Except as provided in subsection (2), if a conversion becomes effective under section 372, 373, or 374, the converted
entity is a continuation of the converting credit union and all the property and interests in property and every cause of
action, right, privilege, interest, and asset of the converting credit union is immediately and without any conveyance,
transfer, or other action vested in the converted organization. Every right, obligation, and relationship of the
converting credit union to or in respect to any person, estate, creditor, member, depositor, trust, trustee, collective
bargaining agreement, or beneficiary of any trust or fiduciary function continue unimpaired. The converted
organization shall continue to hold all the rights, obligations, relationships, and trusts, and the duties and liabilities
connected with them, and shall execute and perform each and every trust and relationship in the same manner as if
the credit union had not converted. The conversion does not release the converted organization from its obligations to
pay and discharge all the liabilities created by law or incurred by the converting credit union before the conversion, or
any tax imposed by the laws of this state up to the day of the conversion in proportion to the time that has elapsed
since the last preceding tax payment, or any assessment, penalty, or forfeiture imposed or incurred under the laws of
this state before the date of the conversion.
(2) Within 1 year after the conversion, the commissioner may for good cause require a converting credit union to divest
itself of an asset that does not conform to the legal requirements relative to assets acquired and held by the
converted organization.
(3) If a converting credit union was appointed in a fiduciary capacity by a court or governmental tribunal, agency, or
officer, the converted organization shall file an affidavit with the appointing authority setting forth the fact of
conversion, the name and address of the converted organization, and the amount of its capital and surplus. A
converted organization acting as a fiduciary by appointment of a court is subject to removal by a court of competent
jurisdiction.
§ 490.376. Conversion of foreign credit union into domestic credit union.
(1) A foreign credit union may convert to a domestic credit union if all of the following are met:
(a) The foreign credit union complies with the applicable law under which it is chartered for a conversion under that
law.
(b) The credit union board files a certificate of organization with the commissioner, approved and executed in triplicate
by a majority of the credit union board.
(c) After executing the certificate of organization, a majority of the directors adopt bylaws for the governance of the
credit union consistent with this act and execute any other agreements or documents and take any other action
required to complete the conversion.
(d) After an examination of the credit union and the proceedings of the directors and members concerning the
conversion, the commissioner approves of the certificate of organization filed under subdivision (b).
(e) If the commissioner approves the certificate of organization, the commissioner shall notify the applicants of the
commissioner's decision and shall immediately issue a certificate of approval attached to the duplicate certificate
of organization and return it to the credit union. The certificate shall indicate that the conversion complies with the
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laws of this state and that after conversion the credit union and all its members, officers, and employees have the
same rights, powers, and privileges and are subject to the same duties, liabilities, and obligations that apply to
domestic credit unions under this act.
(2) The credit union shall pay the expenses of the examination described in subsection (1)(d), in an amount established by
the commissioner. The amount paid for the examination is not refundable.
(3) If the commissioner approves a conversion, the credit union shall pay an operating fee determined under section 201,
on a prorated basis for the operating fee period in which the conversion becomes effective. The date that the
conversion becomes effective is the basis for calculating the proration.
(4) If a conversion becomes effective under this section, the converted domestic credit union is a continuation of the
converting foreign credit union and all the property and interests in property and every cause of action, right,
privilege, interest, and asset of the converting foreign credit union is immediately and without any conveyance,
transfer, or other action vested in the converted domestic credit union. Every right, obligation, and relationship of the
converting foreign credit union to or in respect to any person, estate, creditor, member, depositor, trust, trustee,
collective bargaining agreement, or beneficiary of any trust or fiduciary function continue unimpaired. The converted
domestic credit union shall continue to hold all the rights, obligations, relationships, and trusts, and the duties and
liabilities connected with them, and shall execute and perform each and every trust and relationship in the same
manner as if it had after the conversion assumed the trust or relationship and obligations and liabilities connected with
the trust or relationship.
(5) Any directors of the foreign credit union converting to a domestic credit union under this section that meet the criteria
described in section 341(8) may continue as directors of the domestic credit union.
Minnesota
§52.201 REORGANIZING FEDERAL CREDIT UNION INTO STATE CREDIT UNION.
When any federal credit union authorized to convert to a state charter has taken the necessary steps under the federal
law for that purpose, seven or more members, upon authority of two-thirds of the members present and entitled to vote
and who shall have voted for such conversion at a regular or special meeting upon 14 days mailed written notice to each
member at the member's last known address clearly stating that such conversion is to be acted upon, and upon approval
of the commissioner of commerce, may execute a certificate of incorporation under the provisions of the state Credit
Union Act, which, in addition to the other requirements of law, shall state the authority derived from the shareholders of
such federal credit union; and upon recording such certificate as required by law, it shall become a legal state credit
union and the members of the federal credit union shall without further action be members of the state credit union. This
includes members of the federal credit union on the basis of acceptance of small employer groups provided the
commissioner may require contemporaneous filing of applications under section 52.05, subdivision 2. Thereupon the assets
of the federal credit union, subject to its liabilities not liquidated under the federal law before such incorporation, shall vest
in and become the property of such state credit union and the members upon request shall be entitled to a new
passbook showing existing share and loan balances. The commissioner of commerce shall approve or disapprove of the
conversion within 60 days of the date the proposal is presented.
Mississippi SEC. 81-13-65. Conversion from state to federal credit union and from federal to state credit union.
(1) A state credit union may be converted into a federal credit union by complying with the following requirements:
(a) The proposition for such conversion shall first be approved, and a date set for a vote thereon by the members, either
at a regular meeting or a special meeting called for that purpose by a majority of the directors of the state credit
union. Written notice of the proposition and of the date set for the vote shall be delivered or mailed to each member,
not more than thirty (30) days nor less than seven (7) days prior to such date. Approval of the proposition for
conversion shall be by the affirmative vote of a majority of the members attending said meeting.
(b) A statement of the results of the vote, verified by the affidavits of the president or vice president and the secretary,
shall be filed with the Commissioner of Banking and Consumer Finance within ten (10) days after the vote is taken.
(c) Promptly after the vote is taken and in no event later than ninety (90) days thereafter, if the proposition for conversion
was approved by such vote, the credit union shall take such action as may be necessary under the Federal Credit
Union Act to make it a federal credit union, and within ten (10) days after receipt of the federal credit union charter
there shall be filed with the commissioner a copy of the charter thus issued. Upon such filing the credit union shall
cease to be a state credit union.
(d) Upon ceasing to be a state credit union, such credit union shall no longer be subject to any of the provisions of this
chapter. The successor federal credit union shall be vested with all of the assets and shall continue responsible for all
of the obligations of the state credit union to the same extent as though the conversion had not taken place.
(2) (a) A federal credit union, organized under the Federal Credit Union Act, may be converted into a state credit union
by:
(i) Complying with all federal requirements requisite to enabling it to convert to a state credit union or cease
being a federal credit union;
(ii) Filing with the commissioner proof of such compliance, satisfactory to the commissioner;
(iii) Filing with the Department of Banking and Consumer Finance the articles of incorporation required for state
credit unions; and
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(iv) Filing such other statements or proof as may from time to time be required by the commissioner.
(b) Should the commissioner determine that an audit should be made of the credit union prior to approval, he shall
direct such audit and the reasonable, actual cost thereof shall be paid by the credit union.
(c) When the commissioner has been satisfied that all of such requirements have been complied with, the
commissioner shall approve the charter of incorporation. Upon such approval the federal credit union shall
become a state credit union as of the date it ceases to be a federal credit union. The state credit union shall be
vested with all of the assets and shall continue responsible for all of the obligations of the federal credit union to the
same extent as though the conversion had not taken place.
Missouri § 370.359. Conversion from state to federal or federal to state credit union, procedure.
1. A credit union holding a certificate of organization under the laws of this state may be converted into a federal credit
union under the laws of the United States by complying with the following requirements:
(1) The proposition for the conversion shall first be approved, and a date set for a vote thereon by the members, either
at a meeting to be held on the date or by ballot to be cast on or before the date, by a majority of the directors of
the state credit union. Written notice of the proposition and of the date set for the vote shall then be delivered in
person to each member, or mailed or delivered to each member at the address for the member appearing on the
records of the credit union, not more than thirty nor less than fourteen days prior to the date. Approval of the
proposition for conversion shall be by the affirmative vote of a majority of the members who vote by written or
electronic ballot. All members should be provided the opportunity to vote, without being required to attend the
meeting where the proposition is voted on;
(2) A statement of the results of the vote, verified by the affidavits of the president or vice president and the secretary,
shall be filed with the director of the division of credit unions and the secretary of state within ten days after the vote
is taken;
(3) Promptly after the vote is taken and in no event later than ninety days thereafter, if the proposition for conversion
was approved by the vote, the credit union shall take such action as may be necessary under the United States law
to make it a federal credit union, and within ten days after receipt of the federal credit union charter there shall be
filed with the secretary of state and the director of the division of credit unions, a copy of the charter thus issued.
Upon filing, the credit union shall cease to be a state credit union;
(4) Upon ceasing to be a state credit union, the credit union shall no longer be subject to any of the provisions of this
chapter. The successor federal credit union shall be vested with all of the assets and shall continue responsible for all
the obligations of the state credit union to the same extent as though the conversion had not taken place.
2. A federal credit union, organized under the laws of the United States, may be converted into a state credit union by:
(1) Complying with all federal requirements requisite to enabling it to convert to a state credit union;
(2) Filing with the director of the division of credit unions proof of the compliance, satisfactory to him; and
(3) Filing with the director of the division of credit unions a certificate of organization as required by this chapter.
3. When the director of the division of credit unions has been satisfied that all of these requirements, and all other
requirements of this chapter, have been complied with, he shall approve the organization certificate, a copy of which
shall be filed with the secretary of state. Upon approval, the federal credit union shall become a state credit union as of
the date it ceases to be a federal credit union. The state credit union shall be vested with all of the assets and shall
continue responsible for all of the obligations of the federal credit union to the same extent as though the conversion
had not taken place.
Montana § 32-3-323. Conversion of charter.
(1) A credit union chartered under the laws of this state may be converted to a credit union chartered under the laws of
any other state or under the laws of the United States, subject to regulations issued by the department of
administration.
(2) A credit union chartered under the laws of the United States or of any other state may convert to a credit union
chartered under the laws of this state. To effect a conversion, a credit union shall comply with all the requirements of
the jurisdiction under which it was originally chartered and the requirements of the department and file proof of
compliance with the department.
Nebraska
§ 21-17,110. Conversion.
(1) A credit union incorporated under the laws of this state may be converted into a federal credit union organized under
the laws of the United States as prescribed in section 21-17,111.
(2) A federal credit union organized under the laws of the United States may be converted into a credit union organized
under the laws of this state as prescribed in section 21-17,112.
§ 21-17,111. Conversion from state to federal credit union.
(1) Any credit union organized under the Credit Union Act may, with the approval of the department and with the
approval of a majority of the credit union members attending an annual or special meeting of the credit union, be
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converted into a federal credit union. The conversion shall not release the state- organized credit union from its
obligations to pay or discharge all liabilities created by law or incurred by it before the conversion, from any tax
imposed by the laws of this state up to the day of the conversion in proportion to the time which has elapsed since the
last preceding payment on such obligations or liabilities, or from any assessment, penalty, or forfeiture imposed or
incurred under the laws of this state up to the date of the conversion. Conversion shall be made pursuant to a
conversion plan approved by the department and shall not be made (a) to defeat or defraud any of the creditors of
the credit union or (b) to avoid the requirements of any law of this state designed to protect consumers. The conversion
plan shall address required notices and disclosures of information concerning advantages and disadvantages to the
credit union and its members of the proposed conversion. Certified copies of all proceedings had by the board of
directors and by the members of the credit union shall be filed by the board of directors with the department, and in
addition, the credit union shall furnish to the department a certified copy of consent or approval of the National
Credit Union Administration if such consent is required by the laws of the United States. Two copies of the proceedings
shall be filed with the department. The department shall certify and forward by registered mail one copy of the
proceedings to the county clerk of the county in which the credit union is located.
(2) When conversion becomes effective, all property of the credit union, including all rights, title, and interest in and to all
kinds of property, whether real, personal, or mixed, and things in action, and every right, privilege, interest, and asset
of any conceivable value or benefit then existing, belonging, or pertaining to it, or which would inure to it, shall
immediately by act of law and without any conveyance or transfer, and without any further act or deed, be vested in
and remain the property of the converted credit union, which shall have, hold, and enjoy the property in its own right
as fully and to the same extent as the property was possessed, held, and enjoyed prior to the conversion. The
converted credit union shall be deemed to be a continuation of the same entity. All the rights, obligations, and
relations of the credit union to or in respect to any person, estate, creditor, member, trust, trustee, or beneficiary of any
trust or fiduciary function shall remain unimpaired. The credit union shall continue to hold all the rights, obligations,
relations, and trusts, and the duties and liabilities connected therewith, and shall execute and perform every trust and
relation in the same manner as if the credit union had not converted.
§ 21-17,112. Conversion from federal to state credit union.
(1) A federal credit union organized under the Federal Credit Union Act, 12 U.S.C. 1753 et seq., and meeting all the
requirements to become a state credit union organized under the Credit Union Act may, with the approval of the
department and in compliance with the applicable law under which it was organized, be converted into a state
credit union organized under the Credit Union Act. The required articles of association may be executed by a majority
of the board of directors of the converting credit union and presented to the department for appropriate examination
and approval. A majority of the directors, after executing the articles of association in duplicate, may execute all other
papers, including the adoption of bylaws for the general government of the credit union consistent with the Credit
Union Act, and do whatever may be required to complete its conversion.
(2) The board of directors of the converting credit union may continue to be directors of the credit union. If the director
approves the articles of association as presented by the board of directors, the director shall notify the board of
directors of his or her decision and shall immediately issue a certificate of approval attached to the duplicate articles
of association and return it to the credit union. The certificate shall indicate that the laws of this state have been
complied with and that the credit union and all its members, officials, and employees shall have the same rights,
powers, and privileges and shall be subject to the same duties, liabilities, and obligations in all respects, as shall be
applicable to credit unions originally organized under the Credit Union Act.
(3) The approval of the department shall be based on an examination of the credit union and the proceedings had by its
board of directors and members with respect to conversion. A conversion shall not be made to defeat or defraud any
of the creditors of the credit union. The expenses of an examination, which shall be computed in accordance with
sections 8-605 and 8-606, shall be paid by the credit union.
(4) When the conversion becomes effective, all property of the converted credit union, including all its right, title, and
interest in and to all property of whatsoever kind, whether real, personal, or mixed, and things in action, and every
right, privilege, interest, and asset of any conceivable value or benefit then existing, belonging, or pertaining to it, or
which would inure to it, shall immediately by act of law and without any conveyance or transfer, and without any
further act or deed, be vested in and remain the property of the converted credit union, which shall have, hold, and
enjoy the property in its own right as fully and to the same extent as the property was previously possessed, held, and
enjoyed by it. The converted credit union shall be deemed to be a continuation of the same entity. All the rights,
obligations, and relations of the credit union to or in respect to any person, estate, creditor, member, trustee, or
beneficiary of any trust or fiduciary function shall remain unimpaired. The credit union shall continue to hold all the
rights, obligations, relations, and trusts, and the duties and liabilities connected therewith, and shall execute and
perform every trust and relation in the same manner as if it had after the conversion assumed the trust or relation and
obligation and liabilities connected with the trust or relation.
Nevada NRS 678.810 Conversions; fee set by regulation.
1. A credit union chartered in accordance with the laws of this state may be converted to a credit union chartered in
accordance with the laws of any other state or the laws of the United States, subject to regulations adopted by the
Commissioner.
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2. A credit union chartered in accordance with the laws of the United States or of any other state may convert to a
credit union chartered in accordance with the laws of this state. To effect such a conversion, a credit union must
comply with all the requirements of the authority under which it was originally chartered and the requirements of the
Commissioner and file proof of such compliance with the Commissioner.
3. Every application for permission to convert to a credit union chartered in accordance with the laws of this state must
be accompanied by an application fee in an amount prescribed by regulation of the Commissioner. The applicant
shall also pay such additional expenses incurred in the process of investigation as the Commissioner deems necessary.
All money received by the Commissioner pursuant to this subsection must be placed in the Investigative Account
created by NRS 232.545.
New Hampshire §383-E:11-1101 State Credit Union to Federal Credit Union.
A state credit union may be converted into a federal credit union by complying with the following requirements:
(a) A majority of the directors of the state credit union shall first approve the proposition for the conversion and set a
date for a vote on the conversion by the members, either at a meeting to be held on the date or by written ballot
to be filed on or before the date. Written notice of the proposition and of the date set for the vote shall then be
delivered in person to each member, or mailed to each member at the address for the member appearing on the
records of the state credit union, not more than 30 nor less than 7 days prior to such date. Approval of the
proposition for conversion shall be by the affirmative vote of a majority of the members of the state credit union who
vote on the proposal. The written notice of the proposition shall in bold face type state that the issue will be decided
by a majority of the members who vote.
(b) A notice of the proposed conversion shall be filed with the commissioner under RSA 383-A:6-602, together with a
statement of the results of the vote, verified by the affidavits of the president or vice president and the clerk, within
10 days after the vote is taken.
(c) Promptly after the vote is taken and in no event later than 90 days thereafter, if the proposition for conversion was
approved by the vote, the state credit union shall take such action as may be necessary under the applicable
federal law to make it a federal credit union, and within 10 days after receipt of the federal credit union charter shall
file with the commissioner a copy of the charter so issued. Upon making the filing, the credit union shall cease to be
a state credit union.
(d) Upon ceasing to be a state credit union, the credit union shall no longer be subject to any of the provisions of this
chapter. The successor federal credit union shall be vested with all of the assets and shall continue responsible for all
of the obligations of the state credit union to the same extent as though the conversion had not taken place.
§ 383-E:11-1102. Federal Credit Union to State Credit Union.
A federal credit union may be converted into a state credit union by complying with such requirements of this chapter
as would have enabled it to have originally qualified for organization as a state credit union. When the commissioner has
been satisfied that the requirements, and all other requirements of this chapter, have been complied with, he shall
approve the organization certificate. Upon approval, the federal credit union shall become a state credit union as of
the date it ceases to be a federal credit union. The state credit union shall be vested with all of the assets and shall
continue responsible for all of the obligations of the federal credit union to the same extent as though the conversion
had not taken place.
New Jersey § 17:13-123. Conversion to or from a federal credit union.
A credit union organized under the provisions of this act may convert to operation as a federal Credit Union, or a federal
Credit Union may convert to a credit union operating under the provisions of this act, without undergoing dissolution or
liquidation.
New Mexico § 58-11-60. Conversion.
A. A credit union organized under the laws of this state may be converted to a credit union organized under the laws of
any other state or under the laws of the United States, subject to regulations issued by the director.
B. A credit union organized under the laws of the United States or of any other state may convert to a credit union
organized under the laws of this state. To effect such a conversion, a credit union shall comply with all of the
requirements of the jurisdiction under which it was originally organized, the requirements provided for in the Credit
Union Act [58-11-1 NMSA 1978] and other requirements determined by the director, and file proof of such compliance
with the director.
C. A bank, savings and loan company or other financial institution that is not a credit union may be converted to a credit
union organized pursuant to the Credit Union Act . To effect such a conversion, the converting financial institution shall
file proof of compliance with all of the requirements of the jurisdiction under which it was originally organized, the
provisions of the Credit Union Act and other requirements determined by the director.
D. A credit union organized pursuant to the Credit Union Act may be converted to a bank, savings and loan company or
other financial institution. To effect such a conversion, the converting credit union shall comply with all the requirements
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of the jurisdiction in which it will be organized, including any rules issued by the appropriate regulating agency and
other requirements determined by the director.
New York Banking § 486. Conversion of a federal credit union into a state credit union.
Any federal credit union having its place of business in this state may convert itself into a state credit union. A meeting of
the shareholders shall be held upon not less than ten days' written notice to each shareholder, either served personally or
mailed to him or her at his or her last known address and containing a statement of the time, place and purpose of such
meeting, provided that if the laws of the United States prescribe a different period of time or manner of communicating
notice to each shareholder, then a meeting of the shareholders shall be held in conformity with such laws. Proof by
affidavit of due service of such notice shall be filed in the office of the credit union before or at the time of such meeting.
At such meeting, a majority of the shareholders represented at the meeting may, by an affirmative vote, in person or
by proxy, authorize the conversion of such federal credit union into a state-chartered credit union, provided that in
the event the laws of the United States require a different affirmative vote, such vote shall apply in lieu of the affirmative
vote required hereby. A copy of the minutes of such meeting, certified by the presiding officer and by the secretary of
the meeting, shall be filed in the office of the superintendent within thirty days after the date of such meeting.
There shall be filed with such copy of the minutes the organization certificate required by section four hundred fifty of this
article, executed by a majority of the directors, and proposed bylaws as required by section four hundred fifty-one of
this article. The federal credit union shall also submit a written plan of conversion to the superintendent, together with
an investigation fee as described pursuant to section eighteen-a of this chapter.
Within sixty days after such filing, or such later date as the superintendent in his discretion may determine, the federal
credit union shall take the action prescribed or authorized by the laws of the United States to effect such conversion and
there shall thereupon be filed in the office of the superintendent a copy of any consent or authorization required of such
federal credit union pursuant to the laws of the United States and the state to effect such conversion.
When the superintendent shall have approved the organization certificate and the proposed bylaws and shall have
issued the authorization certificate, as provided in article two of this chapter, the credit union shall cease to be a
federal credit union and shall thereupon be converted into a state credit union, but such federal credit union shall be
deemed to be continued for the purpose of prosecuting or defending suits and of enabling it to wind up its affairs as a
federal credit union and to dispose of and convey its property.
At the time when such conversion becomes effective, all the property of the federal credit union shall immediately by act
of law and without any conveyance or transfer become the property of the state-chartered credit union and the state-
chartered credit union shall succeed to all the rights, obligations and relations of the federal credit union.
Banking § 487. Conversion of a credit union into a federal credit union.
Any credit union may convert itself into a federal credit union. A meeting of the shareholders of the credit union shall be
held upon not less than ten days' written notice to each shareholder, either served personally or mailed to him or her at
his or her last known address and containing a statement of the time, place and purpose of such meeting. Proof by
affidavit of due service of such notice shall be filed in the office of the credit union before or at the time of such meeting.
At such meeting, a majority of the shareholders represented at the meeting may, by an affirmative vote in person or by
proxy, authorize the conversion of such credit union into a federal credit union. A copy of the minutes of such meeting,
certified by the presiding officer and by the secretary of the meeting, shall be filed in the office of the superintendent
within two days thereafter.
Within sixty days after the date of such meeting, or such later date as the superintendent in his discretion may determine,
the credit union shall take such action, in the manner prescribed or authorized by the laws of the United States, as shall
make it a federal credit union and shall thereupon file in the office of the superintendent a copy of the charter or
authorization issued to it. Upon such filing the credit union shall cease to be a corporation under the laws of this state,
except that its corporate existence shall continue for the purpose of prosecuting or defending suits and of enabling it to
wind up its affairs as a state credit union and to dispose of and convey its property. At the time when such conversion
becomes effective, all of the property of the state credit union shall immediately by act of law and without any
conveyance or transfer become the property of the federal credit union and the federal credit union shall thereupon
succeed to all the rights, obligations and relations of the state credit union.
Banking § 487-a. Conversion of a credit union into a mutual savings bank.
1. Any credit union having its place of business in this state may convert to a mutual savings bank, subject to the
requirements and procedures set forth in the laws and regulations governing mutual savings banks.
2. A proposal for a conversion described in this section shall first be approved, and a date set for a vote thereon by the
members (either at a meeting to be held on that date or by written ballot to be filed on or before that date), by a
majority of the directors of the credit union. Approval of the proposal for conversion shall be by the affirmative vote of a
majority of the members of the credit union who vote on the proposal.
3. A credit union that proposes to convert to a mutual savings bank under this section shall submit notice to each of its
members who is eligible to vote on the matter of its intent to convert. Such notice must adequately describe the
purpose and subject matter of the vote to be taken at the meeting or by submission of a written ballot. Such notice
shall be submitted:
a. ninety days before the date of the member vote on the conversion;
b. sixty days before the date of the member vote on the conversion; and
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c. thirty days before the date of the member vote on the conversion.
The notice submitted thirty days before the date of the member vote on the conversion shall contain a written ballot,
and shall clearly inform the member that the member may vote at the meeting or by submitting the written ballot.
Such notice also shall state the date, time and place of the meeting.
4. The superintendent shall require a credit union that proposes to convert to a mutual savings bank under this section to
submit a notice to the superintendent of its intent to convert during the ninety- day period preceding the date of the
completion of the conversion, accompanied by an investigation fee as prescribed pursuant to section eighteen-a of
this chapter.
5. No director or senior management official of a credit union may receive any economic benefit in connection with a
conversion of the credit union as described in this section, other than:
a. director fees; and
b. compensation and other benefits paid to directors or senior management officials of the converted institution in the
ordinary course of business.
c. For purposes of this subdivision, the term "senior management official" means a chief executive officer, an assistant
chief executive officer, a chief financial officer, and any other senior executive officer as defined by the appropriate
federal banking agency pursuant to section 32(f) of the Federal Deposit Insurance Act, 12 U.S.C. 1831i(f).
6. The member vote concerning charter conversion under this section shall be verified by the superintendent. If the
superintendent disapproves of the methods by which the member vote was taken or procedures applicable to the
member vote, the member vote shall be taken again, as directed by the superintendent.
7. Upon completion of a conversion described in this section, the credit union shall no longer be subject to any of the
provisions of this article. When the superintendent shall have approved the organization certificate and the proposed
bylaws and shall have issued the authorization certificate, as provided in article six of this chapter, the credit union
shall cease to be a credit union and shall thereupon be converted into a mutual savings bank; provided, however,
that such credit union shall be deemed to be continued for the purpose of prosecuting or defending suits and
of enabling it to wind up its affairs as a credit union and to dispose of and convey its property. At the time when such
conversion becomes effective, all the property of the credit union shall immediately by act of law and without any
conveyance or transfer become the property of the mutual savings bank and the mutual savings bank shall succeed
to all the rights, obligations and relations of the credit union.
North Carolina § 54-109.95. Conversion of charter.
(a) A credit union chartered under the laws of this State may be converted to a credit union chartered under the laws of
any other state or under the laws of the United States, subject to regulations issued by the Administrator of the Credit
Union Division.
(b) A credit union chartered under the laws of the United States or of any other state may convert to a credit union
chartered under the laws of this State. To effect such a conversion, a credit union must comply with all the
requirements of the jurisdiction under which it was originally chartered and the requirements of the Administrator of
Credit Unions and file proof of such compliance with said Administrator.
North Dakota §6-06-35. Conversion from state to federal credit union and from federal to state credit union and from state credit union to
building and loan association.
1. A state credit union may be converted into a federal credit union under the laws of the United States by complying with
the following requirements:
a. The proposition for such conversion must first be approved, and a date set for a vote thereon by the members either
at a meeting to be held on such date or by written ballot to be filed on or before such date, by a majority of the
directors of the state credit union. Written notice of the proposition and of the date set for the vote must then be
delivered in person to each member or mailed to each member at the address for such member appearing on the
records of the credit union, not more than thirty nor less than seven days prior to such date. Approval of the
proposition for conversion must be by the affirmative vote of two-thirds of the members present at the meeting.
b. A statement of the results of the vote, verified by the affidavits of the president or vice president and the secretary,
must be filed with the state credit union board within ten days after the vote is taken.
c. Promptly after the vote is taken and in no event later than ninety days thereafter, if the proposition for conversion was
approved by such vote, the credit union shall take such action as may be necessary under the applicable federal
law to make it a federal credit union, and within ten days after receipt of the federal credit union charter there must
be filed with the state credit union board a copy of the charter thus issued. Upon such filing, the credit union must
cease to be a state credit union.
d. Upon ceasing to be a state credit union, such credit union is no longer subject to any of the provisions of the North
Dakota credit union law. The successor federal credit union is vested with all of the assets and shall continue to be
responsible for all of the obligations of the state credit union to the same extent as though the conversion had not
taken place.
2. a. A federal credit union, organized under the laws of the United States may be converted into a state credit union by:
(1) Complying with all federal requirements requisite to enabling it to convert to a state credit union or to cease
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being a federal credit union;
(2) Filing with the state credit union board proof of such compliance, satisfactory to the commissioner;
(3) Filing with the commissioner an organization certificate and bylaws, both in triplicate, as required by section 6-06-
02; and
(4) Granting discretionary authority to the commissioner to conduct an examination prior to the conversion date.
The commissioner shall set fees for such examination at an hourly rate sufficient to cover all reasonable expenses of
the department of financial institutions associated with the examination. Fees must be collected by the
commissioner, transferred to the state treasurer, and deposited in the financial institutions regulatory fund.
b. When the commissioner has been satisfied that all of such requirements and all other requirements of the North
Dakota law have been complied with, the commissioner shall notify the applicants and the state credit union board
of that fact, and the board shall instruct the secretary of state to issue a charter in accordance with section 6-06-02.
Upon issuance of the charter, the federal credit union shall become a state credit union and ceases to be a federal
credit union. The state credit union is vested with all of the assets and shall continue to be responsible for all of the
obligations of the federal credit union to the same extent as though the conversion had not taken place.
3. After July 31, 2009, a state credit union may convert to a building and loan association by complying with the following
requirements:
a. The proposal for a conversion first must be approved and a date set for a vote on the proposal by the members
either at a meeting to be held on such date or by written ballot to be filed on or before such date by a majority of
the directors of the credit union. Approval of the proposal for the conversion must be by the affirmative vote of two-
thirds of the members voting.
b. A state credit union that proposes to convert to a building and loan association shall submit notice to each of the
credit union's members who are eligible to vote on the matter of the credit union's intent to convert:
(1) Ninety days before the date of the member vote on the conversion;
(2) Sixty days before the date of the member vote on the conversion; and
(3) Thirty days before the date of the member vote on the conversion.
c. A state credit union that proposes to convert to a building and loan association shall submit a notice to the state
credit union board of the credit union's intent to convert at least ninety days before the date of the completion of
the conversion.
d. Upon completion of a conversion, the state credit union is no longer subject to any of the provisions of this chapter.
e. A director or senior management official of a state credit union may not receive any economic benefit in
connection with a conversion of the state credit union other than reasonable director fees and reasonable
compensation and other benefits paid to directors or senior management officials of the converted institution in the
ordinary course of business. As used in this subdivision, the term senior management official means a chief executive
officer, an assistant chief executive officer, a chief financial officer, and any other senior executive officer as may be
defined by the state credit union board.
f. Before January 1, 2009, the state credit union board shall adopt rules applicable to state credit union conversion to a
building and loan association which are consistent with the conversion rules of the national credit union
administration.
g. The commissioner shall review the methodology by which the conversion member vote was taken and procedures
applicable to the member vote. The commissioner shall report the commissioner's findings to the state credit union
board. If the commissioner or the state credit union board disapproves of the methods by which the conversion
member vote was taken or procedures applicable to the member vote, the member vote must be retaken as
directed by the commissioner or the state credit union board.
Ohio
§1733.341 Conversions.
Any credit union operating under this chapter may convert to a federally chartered credit union and any federally
chartered credit union operating in this state may convert to a credit union organized under this chapter upon
compliance with applicable state and federal laws, rules, and regulations.
Any production credit association organized under the "Farm Credit Act of 1971," 85 Stat. 583, 12 U.S.C.A. 2091 to 2097,
may convert to a credit union organized under this chapter upon compliance with applicable state and federal laws
and regulations and with the approval of the superintendent of credit unions.
Oklahoma
O.S. §, 2021. Conversion of Credit Unions
A credit union chartered under the laws of the State of Oklahoma may be converted to a state credit union under the
laws of any other state, or to a federal credit union either within or without the State of Oklahoma. A credit union
chartered under the laws of the United States or any other state may convert to a credit union under the laws of the State
of Oklahoma. To effect such a conversion a credit union must comply with all requirements of the authority under which it
was originally chartered and the requirements of the State Credit Union Board and file proof of such compliance with the
State Credit Union Board.
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Oregon
§723.686 Conversion of charter.
(1) A credit union chartered under the laws of this state may be converted to a credit union chartered under the laws of
the United States, subject to the approval of the National Credit Union Administration.
(2) A credit union chartered under the laws of the United States may convert to a credit union chartered under the laws of
this state subject to approval of the Director of the Department of Consumer and Business Services.
Pennsylvania
§ 1101. Conversion into Federal credit union.
(a) General rule.--A credit union may be converted into a Federal credit union by complying with the following
requirements:
(1) The proposition for such conversion shall first be approved by a majority vote of the directors of the credit union
who shall also set a date for the vote thereon by the members. The vote of the members shall be conducted at a
meeting held on such date, or by written ballot if the bylaws so provide to be filed on or before such date. Notice
of the proposition and of the date set for the vote shall be given each member not more than 30 nor less than ten
days prior to such date. Approval of the proposition shall be by the affirmative vote of a majority of the members
voting, in person or in writing, either at a meeting of the credit union or through a mail ballot vote. In order for a
vote to be considered valid, there must be a quorum established. In the case of a meeting of the credit union, a
quorum shall be established by the presence of at least 10% of the credit union's membership. In the case of a
mail ballot vote, a quorum shall be established by the written response of at least 10% of the credit union's
membership.
(2) A statement of the result of the vote, certified by an officer of the credit union, shall be filed with the department
within ten days after the vote is taken.
(3) Promptly after the vote is taken and in no event later than 90 days thereafter, if the proposition for conversion was
approved, the credit union shall take such action as may be necessary under the applicable laws of the United
States to make it a Federal credit union, and, within ten days after receipt of the Federal credit union charter, it
shall file a copy of the charter thus issued with the Department of State which shall furnish a copy thereof to the
department. Upon such filing with the Department of State, the credit union shall no longer be subject to any of
the provisions of this title. The successor Federal credit union shall be vested with all of the assets and shall
continue to be responsible for all of the obligations of the credit union thus converted to the same extent as
though the conversion had not taken place.
(b) Cross reference.--See 15 Pa.C.S. § 134 (relating to docketing statement).
§ 1102. Conversion from Federal credit union.
(a) General rule.--A Federal credit union may be converted into a credit union subject to the provisions of this title by:
(1) Complying with all Federal requirements requisite to enabling it to convert to a credit union or to cease being a
Federal credit union.
(2) Filing with the department proof of compliance with such Federal requirements in form satisfactory to the
department.
(3) Filing with the department, together with such reasonable fees as shall be established by the department,
including an application fee and fees for such examination and such investigation as it may deem necessary,
articles of conversion which shall set forth:
(i) The proposed name of the converted credit union.
(ii) The exact location of the principal place of business of the credit union into which the Federal credit union
plans to become converted.
(iii) The number, names and addresses of the persons to be the first directors of the converted credit union.
(iv) All other statements required by this title to be set forth in original articles of incorporation in the case of
the formation of a credit union in so far as such information is applicable to a Federal credit union
proposing to become converted into a credit union.
(b) Department review.--Immediately upon the receipt of the articles of conversion, the department shall conduct such
examination as may be deemed necessary to ascertain from the best sources of information at its command:
(1) Whether the name of the proposed credit union conforms with the requirements of law for the name of a credit
union and whether it is the same as one already adopted or reserved by another person or is so similar thereto that
it is likely to mislead the public.
(2) Whether the conversion is made for legitimate purposes.
(3) Whether the interests of members and creditors are adequately protected.
(4) Whether the proposed credit union meets all of the requirements of this title and violates none of its prohibitions
applicable to a credit union incorporated under this title.
(5) Whether the Federal credit union has complied with the requirements of the laws of the United States as they relate
to the conversion of a Federal credit union into a credit union.
Within 60 days after receipt of the articles of conversion, the department shall, upon the basis of the facts disclosed by
its investigation, either approve or disapprove such articles.
(c) Approval action.--If the department approves the forward them to the Department of State for filing. Immediately
upon receipt of the approved articles of conversion, the Department of State shall file the articles. The conversion shall
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become effective immediately upon such filing and the converted credit union shall have all the rights, privileges,
immunities and franchises of the Federal credit union, except that it shall not thereafter acquire authority to engage in
any business or exercise any right which is forbidden to a credit union when originally incorporated under this title.
(d) Disapproval action.--If the department disapproves the articles of conversion, it shall return them to the Federal credit
union desiring to become converted into a credit union stating in detail its reasons for so doing.
(e) Cross reference.--See 15 Pa.C.S. § 134 (relating to docketing statement).
Rhode Island
§ 19-5-23 Conversion.
(a) A credit union may be converted into a federal credit union, and a federal credit union may be converted into a
credit union, by complying with all the requirements of applicable federal and state law.
(b) A federal credit union shall become a credit union when its agreement to form has been approved by the director or
the director's designee under this chapter and when it has filed a copy of its agreement to form with the national
credit union administration and complied with all other requirements of federal law.
(c) A credit union shall become a federal credit union upon the granting of a federal credit union charter to it and the
completion of all other requirements of federal law necessary to be completed to become an operating federal
credit union, and upon the filing with the director or the director's designee a certified vote of the majority of the
credit union members present at a meeting called, in accordance with the credit union's by-laws, for the purpose of
considering a conversion to a federal charter. The converting credit union shall then file with the director or the
director's designee a certified copy of the federal credit union charter and shall surrender its copy of its agreement to
form, or file proof that the agreement to form has been lost.
South Carolina SECTION 34-26-1220. Conversion of credit union to organization under laws of another state or United States; requirement of
member approval.
A credit union incorporated under the laws of this State may be converted to a credit union organized under the laws of
any state or under the laws of the United States, or a credit union organized under the laws of the United States or of any
other state may convert to a credit union incorporated under the laws of this State. To effect such a conversion, a credit
union must receive the approval of a two-thirds majority of the members voting in accordance with the credit union's
bylaws on the question of a charter conversion and upon the approval of the credit union's current and future regulator.
Tennessee § 45-4-1902. Conversion of state credit union into federal credit union.
A state credit union may be converted into a federal credit union by complying with the following requirements:
(1) A majority of the directors of the state credit union shall first approve the proposition for conversion and the date set for
a vote by the members of the state credit union either at a regular meeting or by written ballot to be filed before the
date set for the vote. Written notice of the proposition and of the date set for the vote shall then be delivered in person
to each member, or mailed to each member at the address for the member appearing on the records of the credit
union, not more than thirty (30) nor less than seven (7) days prior to the date. Approval of the proposition for conversion
shall be by the affirmative vote of a majority of the members who vote on the proposal. The written notice of the
proposition shall in boldfaced type state the issue that will be decided by a majority of the members who vote;
(2) A statement of the results of the vote, verified by the affidavits of the president or vice president and of the secretary,
shall be filed with the commissioner of financial institutions within ten (10) days after the vote is taken;
(3) Promptly after the vote is taken and in no event later than ninety (90) days thereafter, if the proposition for conversion
was approved by the vote, the credit union shall take action that may be necessary under the federal Credit Union Act
to make it a federal credit union, and within ten (10) days after receipt of the federal credit union charter, there shall be
filed with the commissioner a copy of the charter thus issued. Upon filing, the credit union shall cease to be a state
credit union; and
(4) Upon ceasing to be a state credit union, the credit union shall no longer be subject to this chapter. The successor
federal credit union shall be vested with all the assets and shall continue to be responsible for all the obligations of the
state credit union to the same extent as though the conversion had not taken place.
§ 45-4-1903. Conversion of federal credit union into state credit union.
A federal credit union, organized under the federal Credit Union Act, may be converted into a state credit union
by:
(1) Complying with all federal requirements requisite to enabling it to convert to a state credit union or cease being a
federal credit union;
(2) Filing with the commissioner proof of compliance, satisfactory to the commissioner;
(3) Filing with the commissioner the articles of incorporation and bylaws required by state credit unions; and
(4) The commissioner, when satisfied that all of the requirements, and all other requirements of the state Credit Union Act
have been complied with, shall issue a certificate of approval of the charter of incorporation and of the bylaws.
Upon approval, the federal credit union shall become a state credit union as of the date it ceases to be a federal
credit union. The state credit union shall be vested with all of the assets and shall continue to be responsible for all of
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the obligations of the federal credit union to the same extent as though the conversion had not taken place.
Texas Sec. 122.201. CONVERSION OF STATE CREDIT UNION TO FEDERAL CREDIT UNION.
(a) A credit union organized under the laws of this state may convert to a credit union under the laws of the United States:
(1) on an affirmative vote by a majority of the members voting at a meeting called for that purpose; and
(2) by complying with any rule adopted by the commission to facilitate the conversion.
(b) On the issuance of a charter by the National Credit Union Administration, the credit union:
(1) ceases to be a credit union incorporated under this subtitle; and
(2) is no longer subject to the supervision and regulation of the commissioner and the department.
(c) The converted credit union shall file with the commissioner a copy of the charter issued to the credit union by the
National Credit Union Administration. Failure to file the required copy of the charter does not affect the validity of the
conversion.
Sec. 122.202. CONVERSION OF STATE CREDIT UNION TO OUT-OF-STATE CREDIT UNION.
A credit union organized under the laws of this state may convert to a credit union under the laws of another state:
(1) on an affirmative vote by a majority of the members voting at a meeting called for that purpose; and
(2) by complying with any applicable commission rule.
Sec. 122.203. CONVERSION OF FEDERAL OR OUT-OF-STATE CREDIT UNION TO STATE CREDIT UNION.
A credit union organized under the laws of the United States or of another state may convert to a credit union organized
under the laws of this state by complying with:
(1) the requirements of the jurisdiction under which the converting credit union is organized; and
(2) commission rules.
Utah Silent
Vermont § 35101. Conversions.
(a) General. The provisions of this chapter shall apply whenever a federal credit union seeks to convert to a Vermont credit
union or whenever a Vermont credit union seeks to convert to a federal credit union; provided, however, that
conversion from a Vermont credit union to a federal credit union shall be as permitted in federal law and shall not
require the Commissioner's approval, and that federal law shall be controlling to the extent the laws of this state are
inconsistent.
(b) Types of conversions. The types of conversions permitted under this chapter are as follows:
(1) Conversion from a federal credit union to a Vermont credit union; and
(2) Conversion from a Vermont credit union to a federal credit union.
(c) Manner of conversion. Any credit union may convert under this chapter in the following manner:
(1) The governing body of the credit union shall approve the plan of conversion by at least a majority vote, unless a
higher percentage is required by the credit union's organizational documents.
(2) The approved plan of conversion, together with a certified copy of the authorizing resolution adopted by the
governing body of the credit union, shall be submitted to the Commissioner for approval pursuant to the
requirements and procedures of subchapter 8 of chapter 220 of this title, except as provided in subsection (a) of
this section.
(3) The plan of conversion, as approved by the Commissioner, shall be submitted to members of the credit union for
their approval at an annual meeting or at a special meeting called for that purpose.
(4) The approved plan shall be finalized as provided in subsection 35101(f) of this section.
(d) Contents of plan of conversion. The plan of conversion shall include:
(1) The name of the credit union and its location;
(2) The type of credit union that the resulting credit union is to be;
(3) A method and schedule for terminating any nonconforming activities that would result from such conversion;
(4) A statement of the competitive impact resulting from such conversion, including the loss of particular financial
services in the market area resulting from such conversion;
(5) A statement that the conversion is subject to approval of the Commissioner, except for conversions from a
Vermont credit union to a federal credit union;
(6) A statement that the conversion is subject to approval of the credit union's members; and
(7) Such additional information as the Commissioner may require.
(e) Member voting requirements. A majority of the members of the credit union casting votes at a duly called and noticed
meeting, unless a higher percentage is required by the credit union's organizational documents, is necessary to
approve the plan of conversion at the meeting. For purposes of this section, written notice must be delivered in person
to each member or mailed to each member at the address for such member appearing on the records of the credit
union, not more than 30 days nor less than seven days prior to the date of the meeting. Notice may be given
electronically if the member has specifically requested or consented to electronic notification of meetings. An
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affirmative vote constitutes approval of the adoption of any amendments to the organizational documents of the
credit union that are necessary to effect the transaction.
(f) Finalizing the plan of conversion. Except as provided in subsection (g) of this section, the credit union shall effect its
conversion as follows:
(1) Upon approval by the members, the credit union shall submit the executed conversion plan to the Commissioner,
together with all necessary amendments to the credit union's organizational documents, each certified by an
officer of the credit union.
(2) The commissioner shall issue to the resulting credit union a certificate specifying the name of the converting credit
union and the name and organizational structure of the resulting credit union. The resulting credit union shall file
one copy of the certificate issued by the Commissioner with the Secretary of State for recording. The certificate
shall be conclusive evidence of the conversion and the correctness of all proceedings relating to the conversion
in all courts and places. The certificate may be filed in any land records office to evidence the new name in
which property of the converting credit union is to be held.
(3) Unless a later date is specified in the conversion plan, the conversion becomes effective upon filing of the
certificate as provided in subdivision (2) of this subsection, and the former charter of the converting credit union
shall terminate automatically. The Commissioner may file or order any credit union to file conforming documents
with the Secretary of State.
(g) Completion of conversion into federal credit union. Upon completion of a conversion into a federal credit union, the
federal credit union shall certify in writing to the Commissioner and the Secretary of State that the conversion has
been completed under applicable federal law. The charter of the converting credit union shall terminate
automatically upon issuance of the federal credit union charter.
(h) If the Commissioner disapproves the conversion plan, the Commissioner shall state the reasons for the disapproval in
writing and furnish them to the credit union. The credit union shall be given a reasonable opportunity to amend the
plan to eliminate the reasons for disapproval.
(i) Authority for expedited conversion. Notwithstanding any other section of law or any organizational document of the
credit union, the Commissioner may order that a charter conversion become effective immediately when the
Commissioner finds it is necessary for the protection of members or the public.
(k) Regulations of the Commissioner. The Commissioner shall issue such regulations governing the conversion of a credit
union organized under this chapter to a federal credit union and the conversion of a federal credit union to a credit
union organized under this chapter as the Commissioner deems necessary or appropriate.
§ 35102. Conversion of a credit union to a mutual financial institution or a cooperative financial institution.
(a) In addition to the provisions of chapter 206 of this title, a credit union may convert to a mutual or cooperative financial
institution if all of the following are met:
(1) At least 30 days before the governing body votes on a plan of conversion under subdivision (2) of this subsection,
the governing body shall give written notice to the members that it is considering a conversion. The governing
body shall mail the notice to the members and shall not include any other mailing with the notice. The notice shall
include all of the following:
(A) A brief statement of why the governing body is considering the conversion;
(B) A brief statement of the major positive and negative effects of the proposed conversion; and
(C) A request for members' written comments on the proposed conversion.
(2) The governing body must approve of the plan of conversion and file the plan of conversion with the
commissioner. An affirmative vote of two-thirds of the entire governing body is required to approve a plan of
conversion. The plan of conversion shall meet all of the following:
(A) The conversion plan discloses to the members information concerning the advantages and disadvantages of
the proposed conversion and contains a statement indicating any material differences in powers between a
credit union and a mutual or cooperative financial institution.
(B) The conversion is not intended to circumvent a pending supervisory action initiated by the Commissioner or
another regulatory agency because of a concern over the safety and soundness of the credit union.
(C) The conversion plan does not provide any official of the converting credit union with any remuneration or other
economic benefit in connection with the conversion.
(D) After conversion, the mutual or cooperative financial institution is likely to be economically viable.
(3) The governing body shall call a special meeting of the members to vote on the conversion plan and shall mail to
each member a notice of the meeting and proposed conversion 60 days before the date of the special meeting.
The notice shall include all of the following:
(A) A summary of the positive and negative effects of the proposed conversion;
(B) A statement that the directors will not receive any remuneration or other economic benefit in connection with
the conversion of the credit union;
(C) A statement that any interested person may obtain more detailed information about the conversion from the
credit union at its principal place of business or by any method approved in advance by the Commissioner;
(D) A statement that the governing body may substantively amend the proposed plan of conversion before the
special meeting based on comments from regulatory authorities or any other reason, and that the governing
body may terminate the proposed plan of conversion;
(E) Instructions for obtaining a copy of the conversion plan;
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(F) The date of the special meeting and a statement that the vote on the conversion will close on that date; and
(G) Any other information required by the Commissioner.
(4) Thirty days before the special meeting of the members, the governing body shall mail a notice of the meeting and
proposed conversion to each member. The notice shall include all of the information described in subdivision (3) of
this subsection for the 60-day notice and shall include the date, time, and place of the special member meeting, a
ballot and postage-paid return envelope, and a summary of the methods permitted for casting votes.
(5) If the governing body substantively amends the plan of conversion, at least 30 days before the vote of the
members on the plan, the governing body shall mail a notice to each member. The notice shall contain the
information concerning the amended plan of conversion described in subdivision (3) of this subsection for a notice
under that subdivision.
(6) At the special meeting of members, the members, by a two-thirds vote of members voting, must approve of the
conversion and the plan of conversion. A member may vote in person or by mail. With the prior approval of the
Commissioner, a credit union may accept member votes by an alternative method that is reasonably calculated
to ensure each member has an opportunity to vote.
(7) The credit union shall file with the Commissioner all of the following:
(A) Certified copies of records of all proceedings held by the governing body and members of the credit union;
(B) Copies of member comments submitted to the credit union under subdivision (1)(C) of this subsection;
(C) If such consent or approval is required, a certified copy of the consent or approval of any state or federal
regulatory authority with jurisdiction over the mutual or cooperative financial institution after the conversion
and, if a holding company is to be formed in connection with the conversion, the regulations of the federal
reserve board of governors or of the office of thrift supervision applicable to holding companies; and
(D) Verification that deposits in the converted mutual or cooperative financial institution qualify for federal
insurance.
(b) If the requirements of this section are met and the Commissioner determines that the notices to members were
accurate, timely, and not misleading, and that conduct of the vote on the conversion plan was fair and lawful, the
Commissioner shall approve the conversion, and the conversion shall be effective.
(c)Except as otherwise required by the Commissioner, this section does not apply to a credit union that submitted to the
Commissioner a plan of conversion to a mutual or cooperative financial institution before the effective date of this
part.
(d) In the event of any conflict between the provisions of this section and the provisions of chapter 206 of this title, the
provisions of this section shall govern.
Virginia § 6.2-1346. Conversion of federal credit union to state credit union.
A credit union organized under the laws of the United States and authorized to do business in the Commonwealth may
convert to a credit union organized under the laws of the Commonwealth by the following procedure:
1. The directors of the federal credit union shall organize a corporation under this chapter and the Virginia Nonstock
Corporation Act (§ 13.1-801 et seq.) for the purpose set forth in § 6.2-1320;
2. The new corporation shall apply for a certificate of authority to do business as a credit union as provided in § 6.2-1321;
3. The federal credit union shall follow the procedures set forth in § 125 (a), of the Federal Credit Union Act (12 U.S.C. §
1771), as it now exists or may hereafter be amended, for conversion;
4. Upon completion of the requirements of the Federal Credit Union Act, the authorized officers of the federal credit
union shall execute a certificate setting forth the procedures followed, the number of members eligible to vote and
the number voting in favor of the plan of conversion and file said certificate with the Commission; and
5. When the Commission has determined that all of the requirements of this section have been complied with, and that
the criteria of § 6.2-1321 have been met, the Commission shall authorize the state-chartered credit union to
commence business as of the date it ceases to be a federal credit union. The successor state-chartered credit union
shall be vested with all of the assets and shall continue to be responsible for all of the obligations of the federal credit
union to the same extent as though the conversion had not taken place.
§ 6.2-1347. Conversion of state credit union to federal credit union.
A state credit union may convert to a federal credit union by the following procedure:
1. At any meeting of the members called and held in accordance with the Virginia Nonstock Corporation Act (§ 13.1-
801 et seq.) to consider such action, the members, by an affirmative vote of those holding and voting two-thirds of
the votes present in person or by proxy, may resolve to convert the credit union into a federal credit union;
2. A copy of the minutes of the meeting duly certified by the authorized officer of the credit union shall be transmitted to
the Commission;
3. The state credit union shall take such action as is necessary under § 125 (b) of the Federal Credit Union Act (12 U.S.C.
§ 1771), as it now exists or may hereafter be amended, to make it a federal credit union;
4. It shall file with the Commission a certified copy of the organization certificate approved by the National Credit Union
Administration Board; and
5. Upon receipt of the organization certificate the state credit union shall become a federal credit union which shall be
vested with all of the assets and shall continue to be responsible for all of the obligations of the state credit union to
the same extent as though the conversion had not taken place.
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§ 6.2-1347.1. Conversion to a state mutual savings institution.
A. A state credit union is authorized to convert to a mutual savings institution organized under Chapter 11 (§ 6.2-1100 et
seq.) of this title.
B. As a condition to converting to a mutual savings institution, a credit union shall comply with the following requirements:
1. At least 60 days prior to a final vote by the board of directors to formally adopt a conversion proposal, the credit
union shall send notice to the Commissioner and each member advising that the board is considering a possible
conversion to a mutual savings institution. Such notice also shall be (i) published concurrently in a newspaper of
general circulation in the credit union's service area; (ii) posted on the credit union's website; and (iii) posted in a
conspicuous place in the lobby of each of the credit union's offices. The notice shall, at a minimum, contain the
following information:
a. A prominent legend in bold-face type that advises the members of a potential conversion;
b. The electronic availability of information related to a potential conversion;
c. A telephone number and e-mail address that members may use to request copies of the potential conversion
information that is available by electronic means;
d. The ability of members to submit written comments on the potential conversion; and
e. A clear, concise, and impartial description of the potential conversion to be considered by the board.
2. The credit union shall post information related to a potential conversion on the credit union's principal Internet web
site at least 60 days prior to a vote by the board of directors to adopt a proposal of conversion. The posted
information shall, at a minimum, discuss:
a. The business purposes that might be accomplished by a conversion;
b. The differences between and similarities of a credit union and a mutual savings institution;
c. An estimate of the anticipated conversion expenses;
d. The methods by which a member may request a copy of the posted information;
e. The method and timeline for members to submit written comments on the potential conversion; and
f. The process that will be followed if the board formally adopts a conversion proposal.
3. The board shall provide members a reasonable opportunity to submit written comments relating to a potential
conversion. The board may hold a special meeting to receive member input regarding the potential conversion. It is
within the board's discretion to determine the type, number, duration, and location of any special meeting. Before
taking a final vote on a conversion proposal, the board shall review and consider all written comments and any other
member input received at any special meeting. The conversion resolution shall state that the board has reviewed
and considered all such comments and input and has determined affirmatively that the conversion is in the best
interests of the members.
4. Subsequent to the written comment period, the credit union shall adopt, by the affirmative vote of at least a majority
of the members of its board of directors, a conversion proposal consistent with this section. The credit union shall
notify the Commissioner of the board's approval of the proposal, and shall file an application in accordance with §
6.2-1118 and pay the accompanying fee in accordance with § 6.2-1202. In addition, the credit union shall send to
the Commissioner as soon as reasonably practical (i) a budget of the anticipated conversion expenses including
legal, postage and mailing, advertising, printing, consulting fees, examination and operating fees, and any overtime
or other employee compensation to be paid exclusively as a result of the conversion and (ii) any other information
reasonably requested by the Commissioner.
5. At least 30 days prior to a vote by the members to formally adopt the conversion proposal, the credit union shall mail
to each member a notice of a meeting of the members to consider the conversion proposal, advising the members
of the board's adoption of the conversion proposal. The notice must include a prominent statement that the
conversion will be decided by a vote of members eligible to vote on the proposal under the credit union's bylaws
and that the affirmative votes of two-thirds of those eligible members voting are required for approval unless the
articles of incorporation require a greater or lesser vote in which case the notice shall specify that percentage.
However, in no case shall the percentage vote be less than a majority of the members voting notwithstanding what is
specified in the articles of incorporation. The notice shall clearly inform the members that they may vote at the
members' meeting on the proposal or submit the written ballot included with the notice. Each eligible member is
entitled to one vote. With the notice, members shall be provided plain language disclosures of material facts and
information to be used as a basis for reaching an informed decision to vote on the conversion, including but not
limited to a summary of all information required by subdivision B 2. The disclosures shall be submitted to the
Commissioner. The Commissioner may suggest changes in the disclosures prior to the documents being mailed to
members.
6. A director, officer, committee member, agent, or senior management employee of the credit union, and immediate
family members of any such individuals, shall not, directly or indirectly, receive a fee, commission, or other
consideration, other than that person's usual salary or compensation, for aiding, promoting, or assisting in a
conversion under this section. A violation of this subdivision shall constitute a prima facie violation of subsection A of §
13.1-870.
7. The corporate existence of a credit union converting under this section shall continue in its successor. Each member
shall be entitled to receive a share or deposit account or accounts in the converted institution equal in amount to
the value of accounts held in the former credit union subject to any lien or right of offset held by the credit union.
8. The Commission shall approve the conversion if all of the conditions required by this section and § 6.2-1118 have
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been met, unless the Commission determines that, because of a concern over the safety and soundness of the credit
union, the conversion is not in the best interest of the credit union or its members.
9. The eligible and voting members of the credit union must approve the conversion proposal by a two- thirds
affirmative vote of those voting, or such greater or lesser vote provided for under the articles of incorporation, but in
no event less than a majority of the members voting notwithstanding what the articles of incorporation may specify.
Such vote shall be by secret ballot and shall be conducted by an independent entity, which may be such credit
union's legal or accounting firm.
10. Following approval of the conversion by the members, the conversion shall become effective when (i) the
Commission shall have approved it and (ii) any amendment of the articles of incorporation of the credit union
necessary to effect the conversion shall have become effective.
C. If any requirements for notice, meetings, voting or other requirements in this section are inconsistent with the Virginia
Nonstock Corporation Act (§ 13.1-800 et seq.), the provisions of this section shall control.
Washington
RCW 31.12.464 Merger or conversion of state into federal, out-of-state, or foreign credit union, or other type of financial
institution.
(1) A credit union may merge or convert into a federal credit union as authorized by the federal credit union act. The
merger or conversion must be approved by a majority vote of those credit union members voting at a membership
meeting, unless the credit union prescribes in its bylaws a higher percentage approval vote than a simple majority.
(2) If the merger or conversion is approved by the members, a copy of the resolution certified by the secretary must be
filed with the director within ten days of approval. The board may effect the merger or conversion upon terms agreed
by the board and the federal regulator.
(3) A certified copy of the federal credit union charter or authorization issued by the federal regulator must be filed with
the director and thereupon the credit union ceases to exist except for the purpose of winding up its affairs and
prosecuting or defending any litigation by or against the credit union. For all other purposes, the credit union is
merged or converted into a federal credit union and the credit union may execute, acknowledge, and deliver to the
successor federal credit union the instruments of transfer, conveyance, and assignment that are necessary or
desirable to complete the merger or conversion, and the property, tangible or intangible, and all rights, titles, and
interests that are agreed to by the board and the federal regulator.
(4) Mergers and conversions are effective after all applicable regulatory waiting periods have expired and upon filing of
the credit union's articles of merger or articles of conversion, as appropriate, by the secretary of state, or a later date
stated in the articles, which in no event may be later than ninety days after the articles are filed.
(5) Procedures, similar to those contained in subsections (1) through (4) of this section, prescribed by the director must be
followed when a credit union merges or converts into an out-of-state or foreign credit union, or other type of financial
institution.
RCW 31.12.467 Merger or conversion of federal, out-of-state, or foreign to state credit union.
(1) A federal credit union located and conducting business in this state may merge or convert into a credit union
organized and operating under this chapter.
(2) In the case of a conversion, the board of the federal credit union shall file with the director proposed articles of
incorporation and bylaws, as provided by this chapter for organizing a new credit union. If the conversion is approved
by the director, the federal credit union becomes a credit union under the laws of this state.
(3) The assets and liabilities of the federal credit union will vest in and become the property of the successor credit union
subject to all existing liabilities against the federal credit union. Members of the federal credit union may become
members of the successor credit union.
(4) Mergers and conversions are effective after all applicable regulatory waiting periods have expired and upon filing of
the federal credit union's articles of merger or articles of conversion, as appropriate, by the secretary of state, or a later
date stated in the articles, which in no event may be later than ninety days after the articles are filed.
(5) Procedures, similar to those contained in subsections (1) through (4) of this section, prescribed by the director must be
followed when an out-of-state or foreign credit union wishes to merge or convert into a credit union organized and
operating under this chapter.
West Virginia §31C-10-3. Conversion.
(a) A credit union incorporated under the laws of this state may be converted to a credit union organized under the laws
of any other state or under the laws of the United States by complying with the following requirements:
(1) The proposition for the conversion shall first be approved and a date set for a vote thereon by the members (either
at a meeting to be held on such date or by written ballot to be filed on or before such date) by a majority of the
directors of the West Virginia state credit union. Written notice of the proposition and of the date set for the vote
shall then be delivered in person to each member, or mailed to each member at the address for such member
appearing on the records of the credit union, not more than sixty or less than fourteen days prior to such date.
Approval of the proposition for conversion shall be by the affirmative vote of two thirds of the members voting in
person or in writing;
(2) A statement of the results of the vote, verified by the affidavits of the president or vice president and the secretary,
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shall be filed with the commissioner of banking within ten days after the vote is taken; however, no West Virginia
state-chartered credit union may convert its charter to that of another state unless: (i) The conversion is approved
by the commissioner of banking in writing after notice; (ii) the other state allows conversions of its credit unions to a
West Virginia state charter on a reciprocal basis; and (iii) the majority, or in the event the credit union operates
offices in more than two states, the plurality, of the credit union's members are residents of that other state. To the
extent that an out-of- state credit union created by conversion seeks to conduct business through a branch or
service facility in West Virginia, the provisions of section six, article two of this chapter shall apply;
(3) Promptly after the commissioner of banking has approved the conversion in writing, and in no event later than
ninety days thereafter, the credit union shall take such action as may be necessary under the applicable federal or
state law to make it a federal credit union or credit union of another state and within ten days after receipt of the
federal credit union charter or out-of-state credit union charter there shall be filed with the commissioner of banking
a copy of the charter thus issued. Upon such filing, the credit union shall cease to be a West Virginia state-chartered
credit union;
(4) The successor federal credit union or out-of-state chartered credit union shall be vested with all the assets and shall
continue to be responsible for all of the obligations of the West Virginia state credit union to the same extent as
though the conversion had not taken place.
(b) A credit union organized under the laws of the United States or of any other state may convert to a credit union
incorporated under the laws of this state. To effect a conversion, a credit union must comply with all the requirements
of the jurisdiction under which it was originally organized and the requirements of the laws and rules of this state and
file proof of compliance with the commissioner. The commissioner shall generally treat the conversion to a West
Virginia state-chartered credit union as a formation of a new credit union pursuant to article two of this chapter and
the procedures and requirements therein shall be followed to the extent applicable.
Wisconsin § 186.314 Conversion.
(1m) To federal credit union. A credit union may convert to a federal credit union by complying with the following:
(a) The proposition for a conversion shall first be approved by unanimous recommendation of the directors of the
credit union. The directors shall set a date for a vote by the members on the conversion. Written notice specifying
the reason for conversion and the date set for the vote shall be delivered in person or mailed to each member at
the address appearing on the records of the credit union, not more than 45 days nor less than 15 days before the
meeting. A majority of the members voting, in person or in writing, may approve the proposition for conversion,
provided not more than 15 members or 10% of the total membership, whichever is greater, object by written
notice.
(b) A statement of the results of the vote, verified by the affidavits of the chairperson or the vice chairperson and the
secretary, shall be filed with the office of credit unions within 10 days after the vote is taken.
(c) Within 90 days after the date on which the proposition for conversion is approved, the credit union shall take the
necessary action under 12 USC 1771 (b) to make it a federal credit union. Within 10 days after receipt of the
federal credit union charter, the credit union shall file a copy of the charter with the office of credit unions. Upon
filing, the credit union shall cease to be a state credit union.
(d) Upon ceasing to be a state credit union, the credit union shall no longer be subject to this chapter. The successor
federal credit union shall be vested with all the assets and shall continue to be responsible for all of the obligations
of the state credit union to the same extent as though the conversion had not taken place.
(2m) To savings bank or state bank.
(a) In this subsection:
1. "Savings bank" has the meaning given in s. 214.01 (1) (t) and includes a mutual savings bank and a stock savings
bank as well as a savings bank that is a subsidiary of, or is otherwise controlled by, a savings bank holding
company.
2. "Savings bank holding company" has the meaning given in s. 214.01 (1) (tm).
3. "State bank" means a bank organized under ch. 221.
(b) A credit union may convert to a savings bank or state bank by complying with pars. (c) to (e).
(c) The proposition for a conversion shall first be approved by a majority recommendation of the directors of the
credit union. After the board of directors approves the conversion proposal, the directors shall, by a majority vote
of the directors, set a date for a meeting of credit union members to vote on the conversion. Credit union
members may also vote by written ballot to be filed on or before the meeting date. Written notice stating the
credit union's intent to convert to a savings bank or state bank shall be sent to each member at the member's
address appearing on the records of the credit union. This notice shall be sent to each credit union member 3
times, once not more than 95 calendar days nor less than 90 calendar days before the date of the meeting to
vote on the conversion, once not more than 65 calendar days nor less than 60 calendar days before the date of
the meeting to vote on the conversion, and once not more than 35 calendar days nor less than 30 calendar days
before the date of the meeting to vote on the conversion. A ballot may be included in the same envelope as the
3rd notice. Each notice shall adequately describe the purpose and subject matter of the vote to be taken at the
meeting set by the board of directors or by submission of a written ballot. Each notice shall clearly inform
members that they may vote at the meeting or by submitting the written ballot. Each notice shall state the date,
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time, and place of the meeting. If a written ballot is included with the 3rd notice, the 1st and 2nd notices shall
state in a clear and conspicuous manner that a written ballot will be mailed together with another notice
between 30 and 35 days before the date of the membership vote on conversion. If a written ballot is included in
the same envelope with the 3rd notice, the 3rd notice shall so state in a clear and conspicuous manner.
Approval of the proposition for conversion shall be by affirmative vote, in person or in writing, of a majority of the
credit union members voting at the meeting or by written ballot.
(d) A credit union that proposes to convert to a savings bank or state bank under this subsection shall file with the
office of credit unions a notice of its intent to convert and, within 10 days after the member vote on the
conversion under par. (c), a statement of the results of the member vote. If the credit union members vote to
approve the proposition for conversion, the member vote shall be verified by the office of credit unions.
(e) Upon approval by the credit union members of the proposition for conversion under par. (c), the credit union shall
take all necessary action under ch. 214 or 221 to complete the conversion to a savings bank or state bank. Within
90 days after receipt from the division of banking of a certificate of incorporation as a savings bank or state bank,
the credit union shall file a copy of the certificate with the office of credit unions and the office of credit unions
shall issue to a converting credit union a certificate of conversion to a savings bank or state bank.
(f) Upon conversion, the credit union shall cease to be a credit union, shall be a savings bank or state bank, shall no
longer be subject to this chapter, and shall be subject to ch. 214 or 221 and all other provisions of law governing
savings banks or state banks. Upon conversion, the legal existence of the savings bank or state bank shall be a
continuation of the credit union, and all property and every right, privilege, interest, and asset of the credit union
immediately, without any conveyance, transfer, or further act of the savings bank or state bank, vests in the
savings bank or state bank. The resulting savings bank or state bank shall succeed to and be vested with all the
rights, assets, obligations, and relations of the credit union, and all actions and other judicial proceedings to
which the credit union is a party may be prosecuted and defended, to the same extent as though the
conversion had not taken place.
(g) Upon conversion of a credit union into a stock savings bank or state bank, the stock savings bank or state bank
may distribute shares of the capital stock of the stock savings bank or state bank, or may distribute cash, or both,
to the former members of the converted credit union in recognition of their ownership of the equity of the
converted credit union.
(h)
1. In this paragraph, "senior management official" means a chief executive officer, an assistant chief executive
officer, a chief financial officer, and any other senior executive officer as defined by the appropriate federal
banking agency as directed under 12 USC 1831i (f).
2. No director or senior management official of a credit union may receive any economic benefit in connection
with a conversion of the credit union to a savings bank or state bank except that a director or senior
management official may receive director fees as well as compensation and other benefits paid to directors
and senior management officials of the converted savings bank or state bank in the ordinary course of
business.
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Comparative Digest of Credit Union Acts*: Change in Corporate Status
Provisions from State Credit Union Acts
Bank to Credit Union Conversion
*There are 47 state credit union acts. Delaware, South Dakota, and Wyoming do not have a state credit union act.
2015 Model Credit Union Act
Section 9.40. Bank to Credit Union Conversion.44
(1) A bank may convert its charter to a credit union charter under this Act. The converting bank must submit
an adequate conversion plan to the Commissioner for approval. The Commissioner shall prescribe
procedures for banks to convert to a credit union charter.
(2) The procedures prescribed by the Commissioner must include the following:
(a) The converting bank must prepare and submit to the Commissioner a conversion plan that provides:
(i) How the converting bank will comply with the membership requirements under this Act, including
the possible divestiture of customers who do not meet the membership limitations;
(ii) How the converting bank will convert its board to a voluntary, non-paid structure if the credit
union does not provide for the compensation of its directors;
(iii) How the converting bank will divest its board of stock options;
(iv) How the converting bank will divest its capital stock;
(v) How the converting bank will phase out all impermissible investments; and
(vi) How the converting bank will comply with credit union business loan limitations.
(b) The converting bank must perform a complete policy review to address appraisal restrictions, lending
restrictions, investment restrictions, corporate structure restrictions and power structure in order to
ensure compliance with this Act and the commissioner’s regulations.
(3) The conversion plan must be adopted by not less than a majority of the board of directors of the
converting bank.
(4) Upon approval of a plan of charter conversion by the board of directors of the converting bank, the
conversion plan and certified copy of the resolution of the board of directors approving the conversion
plan must be submitted to the Commissioner for approval.
(5) The Commissioner may authorize a credit union resulting from a charter conversion under this chapter to
do the following:
(a) Wind up any activities that the converting bank legally engaged in at the effective time of the
charter conversion but that otherwise are not permitted to credit unions.
(b) Retain for a transitional period any assets that the converting bank legally held at the effective time of
the charter conversion that otherwise may not be held by credit unions.
(c) The terms and conditions of the winding up of activities under subdivision (a) and the retention of
assets under subdivision (b) are subject to the discretion of the Commissioner. However, the
transitional period during which activities may be carried out under subdivision (a) or assets may be
retained under subdivision (b) may not exceed ten (10) years after the effective time of the charter
conversion.
44 If you choose to introduce legislation containing this provision, be prepared to also include a provision that allows
credit unions to convert to or merge into banks.
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Comparative Digest of Credit Union Acts*: Change in Corporate Status
Provisions from State Credit Union Acts
Bank to Credit Union Conversion
*There are 47 state credit union acts. Delaware, South Dakota, and Wyoming do not have a state credit union act.
Only Florida, Hawaii, Iowa, New Mexico and Vermont state credit union acts address bank to credit union conversion.
Florida § 655.411 Conversion of charter.—
(1) A financial entity may apply to the office for permission to convert its charter without changing its business form or to
do business as another type of financial entity in accordance with the following procedures:
(a) The board of directors must approve a plan of conversion by a majority vote of all the directors. The plan must
include a statement of:
1. The type of financial entity which would result if the application were approved and the proposed name under
which it would do business.
2. The method and schedule for terminating any activities and disposing of any assets or liabilities that would not
conform to the requirements of the resulting financial entity.
3. The impact of such change on the financial entity’s business plan and operations, including any effect on the
availability of particular financial services in the market area served by the financial entity.
4. Such financial data as may be required to determine compliance with the capital, reserve, and liquidity
requirements applicable to the resulting financial entity.
5. Such other information as the commission may by rule require.
(b) Following approval by the board of directors, the conversion plan, together with a certified copy of the authorizing
resolution adopted by the board, must be submitted to the office for approval before being submitted to the
members or stockholders of the financial entity. The application for conversion must be in the form prescribed by
the commission, contain such additional information as the commission or office reasonably requires, and be
accompanied by a filing fee in accordance with s. 657.066(3) or s. 658.73. Additionally, the office is authorized to
assess any financial entity, applying to convert pursuant to this section, a nonrefundable examination fee to cover
the actual costs of any examination required as a part of the application process.
(c) The office shall approve the plan if it finds that:
1. The resulting financial entity would have an adequate capital structure with regard to its activities and its deposit
liabilities.
2. The proposed conversion would not cause a substantially adverse effect on the financial condition of the
financial entity.
3. The officers and directors have sufficient experience, ability, and standing to indicate a reasonable promise for
the successful operation of the resulting financial entity.
4. The schedule for termination of any nonconforming activities and disposition of any nonconforming assets and
liabilities is reasonably prompt, and the plan for such termination and disposition does not include an unsafe or
unsound practice.
5. The officers or directors have not been convicted of, or pled guilty or nolo contendere to, a violation of s. 655.50,
relating to money laundering in financial institutions; chapter 896, relating to offenses related to financial
transactions; or any similar state or federal law.
6. The resulting financial entity is able to comply with the applicable terms of any regulatory action in effect before
the date of the conversion.
7. The current and resulting primary federal regulatory agencies do not object to the proposed conversion.
If the office disapproves the plan, it shall state its objections and give the financial entity an opportunity to amend
the plan to overcome such objections. The office may deny an application by an entity that is subject to a cease
and desist order or other supervisory restriction or order imposed by a state or federal supervisory authority, insurer,
or guarantor.
(d) If the office approves the plan, it may be submitted to the members or stockholders at an annual meeting or at
any special meeting called to consider such action. Upon a favorable vote of a majority of the total number of
votes eligible to be cast or, in the case of a credit union, a majority of the members present at the meeting, the
plan is adopted. Copies of the minutes of the proceedings of such meeting of the members or stockholders,
verified by the affidavit of an officer, as established in the bylaws of the financial institution, must be filed with the
office within 10 days after such meeting. Such verified copies of the proceedings of such meeting are presumptive
evidence of the holding and action of such meeting. If the members or stockholders approve the plan of
conversion, the directors shall then execute new articles of incorporation or amendments to existing articles and
two copies of the new bylaws. The directors shall insert in the articles of incorporation the following: “This (bank,
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association, etc.) is incorporated by conversion from a (national bank, state association, etc.) .”
(e) If the members or stockholders adopt the plan of conversion, the financial entity shall apply to the appropriate
insurer for a commitment for insurance of accounts for the shares and deposits of the resulting financial entity.
(f) The plan shall not take effect until the office has received notice that the commitment for insurance of accounts
has been given by the insurer. Upon receipt of such notice, the office shall issue a new charter to the financial
entity authorizing it to transact business pursuant to applicable law.
(2) The commission may provide by rule for any additional procedures to be followed by any national or federal financial
entity seeking to convert its charter pursuant to this section.
(3) A mutual financial institution requesting approval to convert its charter may not be converted into a capital stock
financial institution until it has complied with the requirements of s. 665.033(1) and (2). For this purpose, references in s.
665.033(1) and (2) to associations are deemed to refer also to credit unions; but, in the case of a credit union, the
provision therein concerning proxy statements does not apply.
(4) This section does not authorize a capital stock financial institution to convert to a mutual financial institution.
(5) Nothing in the law of this state shall restrict the right of a state financial institution to convert to a national or federal
financial institution upon compliance with the laws of the United States, and, upon completion of such conversion, it
shall surrender its charter as a state financial institution.
Hawaii §412:3-600 Applicability of this part.
This part applies to:
(1) The conversion, merger, consolidation, acquisition of assets or assumption of liabilities or deposits, acquisition of
control, voluntary cessation of business, or voluntary dissolution involving a Hawaii financial institution;
(2) The merger, consolidation, or acquisition of control of a financial institution holding company which controls:
(A) A Hawaii financial institution; and
(B) To the extent permitted by federal law, a federal financial institution whose operations are principally conducted in
this State; and
(3) All persons who seek to merge or consolidate with, acquire the assets or assume the liabilities of, or acquire control of:
(A) A Hawaii financial institution;
(B) A financial institution holding company which controls a Hawaii financial institution; and
(C) To the extent permitted by federal law, a financial institution holding company which controls a federal financial
institution whose operations are principally conducted in this State.
§412:3-601 No conversions, mergers, consolidations, acquisitions, assumptions, voluntary cessations of business, or voluntary
dissolutions except pursuant to this part.
Except as modified by the commissioner's powers under parts III, IV, and V of article 2, no Hawaii financial institution or
financial institution holding company may acquire all or substantially all of the assets or assume any of the liabilities of
another company, undergo a conversion, merger, or consolidation, sell all or substantially all of its assets, be subject to
any assumption of any of its liabilities or to an acquisition of control, cease business, or dissolve except in accordance with
this part.
§412:3-602 Definitions.
As used in this part:
"Participating institution" means one or all of the financial institutions (or, where applicable, financial institution holding
companies) participating in a merger or consolidation pursuant to this part.
"Resulting institution" means the financial institution resulting from a merger, consolidation or conversion pursuant to this
part.
§412:3-603 Procedure for applications pursuant to this part.
Whenever the written approval of the commissioner is required with respect to any transaction covered by this part, the
following procedures shall apply:
(1) An application for approval by the commissioner pursuant to this part shall be on a form prescribed by the
commissioner and shall contain any information, data, and records as the commissioner may require, and shall be
accompanied by a nonrefundable application fee assessed pursuant to section 421:2-105.2. As far as possible
consistent with the effective discharge of the commissioner's responsibilities, the commissioner shall prescribe the use of
forms currently prescribed by the appropriate federal regulatory agency of financial institutions and financial institution
holding companies for identical or similar types of transactions.
(2) If any material change occurs in the facts set forth in an application, or if for any other reason the applicant desires to
amend the application, an amendment setting forth any change, together with copies of all documents and other
material relevant to the change, shall be filed with the commissioner. Within twenty days after receiving an
application or any amendment thereto, the commissioner may request any additional information necessary in
deciding whether to approve a proposed transaction pursuant to this part. The applicant shall submit the additional
information in a reasonable time thereafter, as may be specified by the commissioner;
(3) If the commissioner would approve a plan of conversion, merger, or consolidation, an acquisition of assets or
assumption of liabilities, an acquisition of control, or a voluntary cessation of business or voluntary dissolution, but on
terms different than contained in the application, the commissioner may give notice to the applicant of the nature of
the changes which would be approved, and the applicant may submit an amended application;
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(4) If the commissioner intends to disapprove an application, the commissioner shall deliver to the applicant a written
notice of the intent to disapprove. Within ten days after receipt of the commissioner's notice of intent to disapprove an
application, the applicant may request an administrative hearing, to be held in accordance with chapter 91. If no
request for a hearing is made, the commissioner's disapproval shall become final. If after the hearing the commissioner
finally disapproves the application, the applicant may, within thirty days of the date of the final decision, appeal to
the circuit court as provided in chapter 91;
(5) Notwithstanding any other provision of this part, any complete application which is not approved or denied by the
commissioner within a period of sixty days after the application is filed with the commissioner or, if the applicant
consents to an extension of the period within which the commissioner may act, within the extended period, shall be
deemed to be approved by the commissioner as of the first day after the period of sixty days or the extended period.
If the commissioner gives notice of an informational and comment proceeding on the application, the sixty-day
period shall be extended to a date as may be fixed by order of the commissioner. For purposes of this section, an
application is deemed to be filed with the commissioner at the time when the complete application, including any
amendments or supplements, containing all of the information in the form required by the commissioner, is received
and accepted by the commissioner; and
(6) Any applicant submitting information to the commissioner pursuant to this part may request that the information, or any
part thereof, be kept confidential. The request shall be made in writing and shall set forth the specific items sought to
be kept confidential and the reasons and authority for the confidential treatment. The commissioner may, pursuant to
a request or otherwise, determine that good cause exists to keep some or all of the information confidential, and shall
keep the information confidential and not subject to public disclosure. In connection with an application for the
acquisition of control pursuant to section 412:3-612, the commissioner may release information to the affected
financial institution or financial institution holding company with a directive that some or all of the information be kept
confidential.
§412:3-604 Shareholder or member vote.
(a) For any transaction covered by this part that requires approval of the shareholders or members of the financial
institution, the voting requirements shall be:
(1) If a Hawaii financial institution is a stock institution, the holders of two-thirds of each class of the issued and
outstanding capital stock of the financial institution entitled to vote, or such greater majority as may be provided by
the articles of incorporation of the Hawaii financial institution, shall be required to approve any action under this
part; or
(2) If a Hawaii financial institution is a credit union, a majority of members present in person at any meeting shall be
required to approve any action under this part.
(b) This section shall control over the required percentages for any shareholder vote contained in section 414-313 on
approval by shareholders of a merger or consolidation, section 414-332 on approval by shareholders on the sale of
assets not in the usual and regular course of business, and section 414- 382 on approval by shareholders on the
voluntary dissolution of a corporation.
§412:3-605 Notice to credit union member.
Wherever the approval of a transaction is required by this part by the members of a credit union, notice of a meeting of
its members, which may be an annual or a special meeting, shall be given to each member entitled to vote. The notice
shall be provided not less than twenty days before the date of the meeting. The notice shall state that the purpose or one
of the purposes of the meeting is to vote upon a transaction covered by this part and shall be accompanied by a
detailed description of the proposed transaction or a summary of the transaction and a copy of the plan of conversion,
merger, consolidation, sale of assets or assumption of liabilities, or voluntary cessation of business and dissolution
approved by the board of directors.
§412:3-606 Conversion from State to comparable federal financial institution.
(a) A Hawaii financial institution may convert to a comparable federal financial institution if the conversion is approved at
a meeting of its shareholders or members duly called and noticed and upon a vote which satisfies the requirements of
section 412:3-604.
(b) Within ten days after the meeting of its shareholders or members approving the conversion, the financial institution shall
file with the commissioner:
(1) A notice of intention to convert; and
(2) A certificate signed by two executive officers of the financial institution verifying the validity of the meeting, that the
required vote was obtained, and that the attached copy of the resolution to convert adopted at the meeting is
true and correct.
(c) Within a reasonably prompt time and without any unnecessary delay after the meeting approving the conversion, the
financial institution shall take the action necessary to complete the conversion and to obtain a federal license,
charter, certificate, or other approval to become a federal financial institution.
(d) The date of issuance of the federal license, charter, certificate, or other approval, or the effective date of conversion
stated in the license, charter, certificate or other approval, shall be the effective date of the conversion.
(e) Upon the effective date of the conversion as determined under federal law, the institution's state charter or license
shall terminate without further notice, and the institution shall cease to be regulated by the commissioner. Within ten
days after receipt of the federal charter, license, certificate, or other approval, the resulting financial institution shall
deliver a copy thereof to the commissioner. The resulting financial institution shall also file with the director of
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commerce and consumer affairs a confirmation in writing by the commissioner of the date and time of the
conversion, together with the appropriate filing fee pursuant to chapter 414.
§412:3-607 Conversion from federal to comparable Hawaii financial institution.
(a) A federal financial institution whose operations are principally conducted in this State may convert to a comparable
Hawaii financial institution if the institution, and its holding company or holding companies, if any, shall have complied
with all requirements, conditions, and limitations imposed by federal law with respect to the conversion, subject to any
rights of dissenting shareholders or members and to obtaining a charter under this chapter.
(b) The federal financial institution shall file an application with the commissioner pursuant to section 412:3-603 for a charter
to engage in business as a comparable Hawaii financial institution pursuant to this chapter. The application shall be
accompanied by:
(1) A certificate signed by two executive officers of the financial institution, verifying that it has complied with all
federal laws and regulations relating to the conversion;
(2) The information required from applicants for approval to organize a Hawaii financial institution of the same type;
and
(3) Any other information that the commissioner may require.
(c) The commissioner may require notice to be given to the public as may be deemed appropriate. The commissioner
may conduct an examination of the institution as provided under article 2, part II. The cost of any examination shall be
assessed against and paid by the institution pursuant to section 412:2- 105.
(d) The charter shall be granted only if the commissioner is satisfied that the granting of the charter will not impair the
safety or soundness of the financial institution or any other financial institution, and that the applicant meets all the
requirements set forth in this chapter for the type of financial institution for which the application has been filed. The
requirements shall include, but not be limited to, the appropriate location of offices, capital structure, business
experience, the character of its executive officers and directors, and compliance with all applicable provisions of
chapter 414. The director of commerce and consumer affairs shall not file the articles of incorporation until the
application for a charter to engage in business as a Hawaii financial institution shall have been approved by the
commissioner in writing. The commissioner may impose any restrictions and conditions on the operation of the resulting
financial institution as the commissioner deems appropriate and consistent with federal law.
(e) The conversion shall be effective upon the filing of articles of incorporation by the director of commerce and
consumer affairs after all provisions of this section and applicable federal law have been complied with in full.
§412:3-608 Conversion to another type of financial institution.
(a) A financial institution of any type, whether federal or State, may convert to a Hawaii financial institution of any other
type if the institution and its holding company or holding companies, if any, shall have complied with all requirements,
conditions, and limitations imposed by this part and by federal law, if applicable.
(b) If the converting institution is a Hawaii financial institution, its shareholders or members shall approve a conversion to
another type of financial institution at a meeting duly called and noticed and upon a vote which satisfies the
requirements of section 412:3-604.
(c) The financial institution shall file an application with the commissioner pursuant to section 412:3-603 for a charter or
license to engage in the business of the type of financial institution to which it will convert. The application shall be
accompanied by:
(1) A certificate signed by two executive officers of the financial institution, verifying the validity of the meeting of the
shareholders or members, that the requisite vote had been obtained, and that the attached copy of the resolution
to convert adopted at the meeting is true and correct, or that the applicant has complied with all federal laws
and regulations regarding the conversion, as the case may be;
(2) The information required from applicants for approval to organize a Hawaii financial institution of the type into
which it will convert; and
(3) Any other information that the commissioner may require.
(d) The commissioner may require notice to be given to the public as may be deemed appropriate. The commissioner
may conduct an examination of the financial institution as provided under article 2, part II. The cost of any
examination shall be assessed against and paid by the financial institution pursuant to section 412:2-105.
(e) The charter or license shall be granted only if the commissioner is satisfied that the granting of the charter or license
will not impair the safety or soundness of the financial institution or any other financial institution, and that the
applicant meets all the requirements set forth in this chapter for the type of financial institution for which the
application has been filed. The requirements shall include but not be limited to the appropriate location of offices,
capital structure, business experience, the character of its executive officers and directors, and compliance with all
applicable provisions of chapter 414. If the resulting Hawaii financial institution is a new corporation to be formed
under chapter 414, the director of commerce and consumer affairs shall not file the articles of incorporation until the
application for a charter or license to engage in the business of the type of financial institution to which it will convert
shall have been approved by the commissioner in writing. The commissioner may impose any restrictions and
conditions on the operation of the resulting financial institution as the commissioner deems appropriate and
consistent with federal law.
(f) If the resulting Hawaii financial institution is an existing corporation formed under chapter 414, the conversion shall be
effective upon the effective date of the new charter or license granted by the commissioner after all provisions of this
section and of federal law shall have been complied with in full. If the resulting Hawaii financial institution is a new
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corporation to be formed under chapter 414, the effective date of the new charter or license shall be the date of
filing of the articles of incorporation by the director of commerce and consumer affairs.
§412:3-610 Effect of conversion, merger, or consolidation.
(a) A Hawaii financial institution or federal financial institution resulting from a conversion, merger, or consolidation
pursuant to this part continues the corporate entities of each converting or participating institution and shall be
deemed to be continuing the same business of each converting or participating institution carried on prior to the
conversion, merger, or consolidation with all of the property, rights, powers, and duties of each converting or
participating institution, except as affected by the law of this State in the case of a resulting Hawaii financial institution
or by federal law in the case of a resulting federal financial institution, and by the articles of incorporation, charter,
and bylaws of the resulting institution. No assignment, deed, conveyance, or other instrument of transfer need be
executed in order for the resulting institution to maintain the title, rights, and powers held by the converting or
participating institutions. The rights of any creditor or obligee of a converting or participating institution prior to any
conversion, merger, or consolidation shall not be affected by such conversion, merger, or consolidation.
(b) A resulting institution shall have the right to use the names of the converting or participating institutions for all legal
purposes, including the recordation and filing of documents pursuant to chapters 501 and 502, whenever it can do
any act under that name more conveniently. Any reference to a converting or participating institution in any writing,
whether executed or taking effect before or after the conversion, merger, or consolidation, shall be deemed a
reference to the resulting institution if not inconsistent with the other provisions of the writing. Provided, however, that
the resulting institution shall not use a name in its signage, advertising, or other promotional materials in a manner that
suggests or might tend to lead others into believing that it is a different type of financial institution.
(c)Except to the extent inconsistent with this part or in contravention of federal law, sections 414- 315(b) and 414-316 shall
be applicable to any merger or consolidation under this part.
(d) If a converting or participating institution is a trust company or a bank that is authorized to do a trust business, the
resulting institution, by operation of law and without further court order, transfer, substitution, act, or deed shall
succeed to the rights, properties, assets, investments, deposits, demands, agreements, and trusts of the converting or
participating institutions under all trusts, personal representations, executorships, administrations, guardianships,
agencies, and all other fiduciary or representative capacities as though the resulting institution had originally assumed
the same and shall succeed to and be entitled to take and execute the appointment to all trusteeships, personal
representations, executorships, guardianships, conservatorships, and other fiduciary and representative capacities to
which the converting or participating institution may be named or is thereafter named in wills, whether probated
before or after the conversion, merger, or consolidation, or to which it is or may be named or appointed by any other
instrument.
§412:3-614 Sale or transfer of charter or license prohibited.
No Hawaii financial institution may sell, transfer, or otherwise dispose of any charter, license, approval, or any other right or
privilege granted under this chapter, unless the sale, transfer, or disposition is part of a conversion, merger, consolidation,
sale, assumption or acquisition of control permitted under this part. Any attempted sale, transfer, or disposition in violation
of this section shall be null, void, and unenforceable.
§412:3-615 Nonconforming assets or business.
If a Hawaii financial institution resulting from a conversion, merger, consolidation, acquisition, or assumption by law may
no longer own certain types of assets once it undergoes the conversion, merger, consolidation, acquisition, or assumption,
or if it may no longer engage in certain types of business activities, the commissioner shall, as part of the order approving
the transaction, allow a reasonable time within which the institution may divest itself of the nonconforming assets or
business activities in order to conform with law.
§412:3-616 Authority for expedited conversion, merger, consolidation, acquisition, or assumption.
Upon application of all participating financial institutions in a conversion, merger, consolidation, acquisition or assumption,
the commissioner may expedite any application for conversion, merger, consolidation, acquisition, or assumption
pursuant to this part and order the transaction to take effect immediately; provided that the financial institutions shall
have complied with any applicable federal law and provided that the commissioner finds that such expedited action is
necessary to protect the financial institutions' depositors, beneficiaries, creditors, or shareholders, or the public. The
commissioner's findings shall be expressed in writing as part of the decision and order approving the conversion, merger,
consolidation, acquisition, or assumption.
§412:3-618 Injunctions.
If it appears to the commissioner that any person has committed or is about to commit a violation of any provision of this
part or any rule or order of the commissioner under this part, the commissioner may apply to the circuit court for an order
enjoining the person from violating or continuing to violate this part or any rule or order and for injunctive relief as the
nature of the case or the interests of the financial institution or the financial institution holding company or its depositors,
beneficiaries, creditors or shareholders may require.
Iowa § 533.402 Conversion of financial institution to state credit union.
1. Any financial institution may convert to a state credit union by complying with the laws of the original chartered
authority and upon the approval of the superintendent. As used in this section, “financial institution” means any credit
union, bank, savings bank, or savings and loan association chartered under federal or state law.
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a. Application for approval of the conversion to a state credit union shall be submitted to the superintendent in the form
prescribed by the superintendent, together with the articles of incorporation and bylaws as required for organization
of a state credit union pursuant to this chapter.
b. The superintendent may cause an examination to be made of any converting financial institution. The converting
financial institution shall reimburse the superintendent for the division’s costs related to the conversion.
2. a. If the superintendent approves the application of a financial institution for conversion to a state credit union, the
superintendent shall cause the articles of incorporation of the resulting state credit union to be filed and recorded in the
county in which the state credit union has its principal place of business and the superintendent shall issue a certificate
of authority to do business under the laws of this state to the resulting state credit union. The financial institution shall then
become a state credit union subject to the laws of this state.
b. The superintendent shall furnish a copy of the certificate to the administrator of the national credit union
administration.
3. a. Upon conversion, the existence of the original financial institution shall cease.
b. The state credit union resulting from the conversion shall have only the authority to engage in the business and
exercise the powers of a state credit union.
4. a. A liability of the original financial institution or of its members, directors, or officers shall not be affected, and any lien
on any property of the financial institution shall not be impaired by the conversion.
b. Any claim existing or action pending by or against the original financial institution may be prosecuted to judgment
as if the conversion had not taken place, or the resulting state credit union may be substituted in its place.
New Mexico §58-11-60. Conversion.
C. A bank, savings and loan company or other financial institution that is not a credit union may be converted to a credit
union organized pursuant to the Credit Union Act . To effect such a conversion, the converting financial institution shall
file proof of compliance with all of the requirements of the jurisdiction under which it was originally organized, the
provisions of the Credit Union Act and other requirements determined by the director.
Vermont § 35103. Conversion of a mutual financial institution or a cooperative financial institution to a credit union.
Chapter 206 of this title [see § 16101 below] shall govern the conversion of a mutual financial institution or a cooperative
financial institution to a credit union.
§ 16101. Conversions.
(a) General. The provisions of this chapter shall apply whenever a national financial institution seeks to convert to a
Vermont financial institution or whenever a Vermont financial institution seeks to convert or amend its charter in order
to change its chartering authority, the nature or scope of its organizational authority or to a different form of ownership;
provided, however, that conversion from a Vermont financial institution into a national financial institution shall be as
permitted in federal law, shall not require the commissioner's approval, and federal law shall be controlling to the
extent the laws of this state are inconsistent.
(b) Types of conversions. The types of conversions permitted under this chapter are as follows:
(1) Conversion from a national financial institution to a Vermont financial institution;
(2) Conversion from a Vermont financial institution to a national financial institution;
(3) Conversion of a special purpose financial institution into a universal financial institution or into another form of
special purpose financial institution;
(4) Conversion of a universal financial institution into a special purpose financial institution;
(5) Conversion of a mutual financial institution or a cooperative financial institution into an investor- owned financial
institution or into a credit union under chapters 220-226 of this title;
(6) Conversion of a credit union under chapters 220-226 of this title into a mutual financial institution or a cooperative
financial institution; or
(7) Conversion of an investor-owned financial institution into a mutual financial institution.
(c) Manner of conversion. Any Vermont financial institution may convert under this chapter in the following manner:
(1) The governing body of the financial institution shall approve the plan of conversion by at least a majority vote,
unless a higher percentage is required by the institution's organizational documents;
(2) The approved plan of conversion, together with a certified copy of the authorizing resolution adopted by the
governing body of the financial institution shall be submitted to the commissioner for approval pursuant to the
requirements and procedures of subchapter 7 of chapter 201 of this title, except as provided in subsection (a) of
this section;
(3) The plan of conversion, as approved by the Commissioner, shall be submitted to the investors or mutual voters of
the institution, as the case may be, for their approval at an annual meeting or at a special meeting called for that
purpose as provided in subsections (e), (f) and (g) of this section; and
(4) The approved plan shall be finalized as provided in subsection (h) of this section.
(d) Contents of plan of conversion. The plan of conversion shall include:
(1) The name of the institution and its location;
(2) The type of the institution that the resulting institution is to be;
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(3) A method and schedule for terminating any nonconforming activities that would result from such conversion;
(4) A statement of the competitive impact resulting from such conversion, including the loss of particular financial
services in the market area resulting from such conversion;
(5) A statement that the conversion is subject to approval of the Commissioner, except for conversions from a
Vermont financial institution to a national financial institution;
(6) A statement that the conversion is subject to approval of the institution's investors or mutual voters, as the case
may be;
(7) In the case of a conversion involving a mutual or cooperative financial institution, the plan shall ensure that the
interests of depositors and account holders in the net worth of the institution are treated equitably; and
(8) Such additional information as the Commissioner may require.
(e) Notice to investors or mutual voters. Notice of the meeting shall be published at least once a week for three successive
weeks in at least one newspaper of general circulation in the county where the institution's principal office is located or
in other newspapers as the commissioner may designate. The notice shall be mailed to each investor of record or
mutual voter at the address on the books of the institution at least 30 days prior to the date of the meeting.
(f) Voting requirements. A majority of each class of equity interest, or a majority of the mutual voters of the institution
casting votes, unless a higher percentage is required by the institution's organizational documents, is necessary to
approve the plan of conversion at the meeting. An affirmative vote constitutes approval of the adoption of any
amendments to the organizational documents of the institution that are necessary to effectuate the transaction.
(g) Rights of dissenting investors. For investor-owned institutions that are converting under this chapter, the rights of
investors dissenting to the conversion are those specified in Title 11 or 11A, depending upon the organizational form of
the institution; provided, however, the rights of dissenting investors in a national financial institution shall be governed
by federal law. To the extent that dissenters' rights are not addressed in Title 11 or 11A or the rights contained in those
titles are less beneficial to the dissenting investors than those rights listed in the institution's organizational documents,
the organizational documents shall govern.
(h) Finalizing the plan of conversion. Except as provided in subsection (i) of this section, the financial institution shall effect
its conversion as follows:
(1) Upon approval by the investors or mutual voters of the institution, as the case may be, the institution shall submit the
executed conversion plan to the Commissioner, together with all necessary amendments to the institution's
organizational documents, each certified by an officer of the institution.
(2) The Commissioner shall issue to the resulting institution a certificate specifying the name of the converting institution
and the name and organizational structure of the resulting institution. The resulting institution shall file one copy of
the certificate issued by the Commissioner with the Secretary of State for recording. The certificate shall be
conclusive evidence of the conversion and the correctness of all proceedings relating to the conversion in all
courts and places. The certificate may be filed in any land records office to evidence the new name in which
property of the converting institution is to be held.
(3) Unless a later date is specified in the conversion plan, the conversion becomes effective upon filing of the
certificate as provided in subdivision (2) of this subsection and the former charter of the converting institution shall
terminate automatically. The Commissioner may file or order any financial institution to file conforming documents
with the Secretary of State.
(i) Completion of conversion into national financial institution. Upon completion of a conversion into a national financial
institution, the national financial institution shall certify in writing to the Commissioner and the Secretary of State that the
conversion has been completed under applicable federal law. The charter of the converting financial institution shall
terminate automatically upon issuance of the national financial institution charter.
(j) If the Commissioner disapproves the conversion plan, the Commissioner shall state the reasons for the disapproval in
writing and furnish them to the institution. The institution shall be given a reasonable opportunity to amend the plan to
eliminate the reasons for disapproval.
(k) Authority for expedited conversion. Notwithstanding any other section of law or any organizational document of the
financial institution, the Commissioner may order that a charter conversion become effective immediately when the
Commissioner finds it is necessary for the protection of depositors, investors or the public.
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Comparative Digest of Credit Union Acts*: Change in Corporate Status
Provisions from State Credit Union Acts
Dissenters’ Rights in Credit Union to Bank Conversion
*There are 47 state credit union acts. Delaware, South Dakota, and Wyoming do not have a state credit union act.
2015 Model Credit Union Act
Section 9.50. Dissenters’ Rights in Credit Union to Bank Conversion.45
(1) If at any time the credit union members vote to convert the credit union to a non-credit union structure,
credit union members who vote to oppose the conversion may withdraw their ownership equity shares
along with their regular credit union accounts to join another credit union.
(2) Ownership equity shares will be calculated by subtracting the percentage of Capital required for a
mutual savings bank from the total assets of the credit union. This amount will then be divided on a pro
rata basis among all of the credit union members taking into consideration the shares on deposit, loans
outstanding and the amount of interest and fees paid and earned at the credit union by the members
over the past 24 months.
45 This provision provides some protection to dissenters in a credit union to bank conversion, if the state act allows for credit
union to bank conversions.
Comparative Digest of Credit Union Acts*: Change in Corporate Status
Provisions from State Credit Union Acts
Dissenters’ Rights in Credit Union to Bank Conversion
*There are 47 state credit union acts. Delaware, South Dakota, and Wyoming do not have a state credit union act.
None of these acts address dissenters’ rights in credit union to bank conversion.