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PAG LIN 1 1 DIVISION I 1 2 Section 1. NEW SECTION. 533.101 TITLE. 1 3 This chapter shall be known as the "Iowa Credit Union Act". 1 4 Sec. 2. NEW SECTION. 533.102 DEFINITIONS. 1 5 As used in this chapter, unless the context otherwise 1 6 requires: 1 7 1. "Account insurance plan" means an arrangement providing 1 8 account and share insurance which is of a type authorized 1 9 under sections 533.307 and 533.308. 1 10 2. "Common bond" means the shared characteristic of 1 11 members of a credit union. 1 12 3. "Credit union" means a cooperative, nonprofit 1 13 association, organized or incorporated in accordance with the 1 14 provisions of this chapter or under the laws of another state 1 15 or the Federal Credit Union Act, 12 U.S.C. } 1751, et seq., 1 16 for the purposes of creating a source of credit at a fair and 1 17 reasonable rate of interest, of encouraging habits of thrift 1 18 among its members, and of providing an opportunity for its 1 19 members to use and control their own money on a democratic 1 20 basis in order to improve their economic and social condition. 1 21 A credit union is also a supervised financial organization 1 22 as that term is defined and used in chapter 537, the Iowa 1 23 consumer credit code. 1 24 4. "Credit union service organization" means a corporation 1 25 organized to provide services for one or more credit unions, 1 26 each of which owns part of the capital stock of the credit 1 27 union service organization, as authorized under section 1 28 533.301, subsection 5, paragraph "f", and which corporation is 1 29 subject to examination by the credit union division of the 1 30 Iowa department of commerce or a federal supervisory agency. 1 31 5. "Ownership share" means a share of the credit union 1 32 acquired by a member at the time membership is initiated. 1 33 6. "State credit union" means a credit union organized 1 34 pursuant to section 533.201. 1 35 7. "Superintendent" means the superintendent of credit 2 1 unions appointed according to section 533.104 to regulate 2 2 credit unions. 2 3 Sec. 3. NEW SECTION. 533.103 CREDIT UNION DIVISION 2 4 CREATED. 2 5 A credit union division of the department of commerce is 2 6 created to administer this chapter. 2 7 Sec. 4. NEW SECTION. 533.104 SUPERINTENDENT. 2 8 1. The superintendent shall be appointed by the governor, 2 9 subject to confirmation by the senate. 2 10 a. The appointee shall be selected solely with regard to 2 11 qualification and fitness to discharge the duties of office. 2 12 b. The individual appointed shall have had at least five 2 13 years' experience as a director or executive officer of a 2 14 credit union, or experience in the regulation or examination 2 15 of a credit union. For purposes of this paragraph, credit 2 16 union membership does not qualify as credit union experience. 2 17 2. The superintendent shall have an office at the seat of 2 18 government. The superintendent's term of office shall be four 2 19 years beginning and ending as provided by section 69.19. 2 20 3. The superintendent shall receive a salary to be set by 2 21 the governor within a range established by the general 2 22 assembly. 2 23 4. A vacancy in the office of superintendent shall be 2 24 filled for the unexpired portion of the regular term. 2 25 5. The superintendent may adopt rules as necessary or 2 26 appropriate to administer this chapter. 2 27 Sec. 5. NEW SECTION. 533.105 DEPUTY SUPERINTENDENT. 2 28 1. The superintendent shall appoint a deputy 2 29 superintendent who shall assist the superintendent in the 2 30 performance of the superintendent's duties. The deputy 2 31 superintendent shall perform the duties of the superintendent 2 32 as directed by the superintendent during the absence or 2 33 inability of the superintendent. 2 34 2. The deputy superintendent shall serve at the pleasure 2 35 of the superintendent. If the office of the superintendent 3 1 becomes vacant, the deputy superintendent shall have all 3 2 powers and duties of the superintendent until a new 3 3 superintendent is appointed by the governor in accordance with 3 4 this chapter. 3 5 3. The deputy superintendent shall receive a salary to be 3 6 fixed by the superintendent. 3 7 Sec. 6. NEW SECTION. 533.106 EMPLOYEES. 3 8 1. a. The superintendent may appoint assistants, 3 9 examiners, and other employees as the superintendent considers 3 10 necessary to the proper discharge of duties imposed upon the 3 11 superintendent by the laws of this state. 3 12 b. Pay plans shall be established for employees, other 3 13 than clerical employees, who examine the accounts and affairs 3 14 of credit unions and who examine the accounts and affairs of 3 15 other persons, subject to supervision and regulation by the 3 16 superintendent, that are substantially equivalent to those 3 17 paid by the national credit union administration and other 3 18 federal supervisory agencies in this area of the United 3 19 States. 3 20 2. a. A state credit union, or its officers, directors, 3 21 or employees, shall not directly or indirectly make a loan of 3 22 money or property to the superintendent or deputy 3 23 superintendent of the credit union division. 3 24 b. The superintendent or deputy superintendent of the 3 25 credit union division shall not directly or indirectly accept 3 26 a loan of money or property from a state credit union, or its 3 27 officers, directors, or employees. 3 28 3. a. An employee of the credit union division, other 3 29 than the superintendent or deputy superintendent, may borrow 3 30 money from a state credit union only on comparable terms and 3 31 conditions to those ordinarily extended to all members of the 3 32 credit union. The employee and the credit union shall each 3 33 notify the superintendent of the existence of the loan. 3 34 b. The superintendent may restrict borrowing by employees 3 35 from state credit unions if the superintendent determines such 4 1 borrowing will interfere with the functions of the credit 4 2 union division. 4 3 c. An employee shall not participate in the examination of 4 4 a credit union where the employee has a loan. 4 5 4. The superintendent, deputy superintendent, or an 4 6 employee of the credit union division shall not perform any 4 7 services for or be an officer, director, or employee of a 4 8 state credit union. 4 9 5. A person who violates this section commits a serious 4 10 misdemeanor, and shall be permanently disqualified from acting 4 11 as an officer, director, or employee of a state credit union 4 12 and permanently disqualified from acting as superintendent, 4 13 deputy superintendent, or an employee of the credit union 4 14 division. 4 15 6. The superintendent, deputy superintendent, or an 4 16 employee of the credit union division who is convicted of 4 17 theft, burglary, robbery, larceny, embezzlement, or other 4 18 crime involving breach of trust shall be forever disqualified 4 19 from holding any position in the credit union division. 4 20 Sec. 7. NEW SECTION. 533.107 CREDIT UNION REVIEW BOARD. 4 21 1. A credit union review board is created. 4 22 a. The board shall be composed of all of the following 4 23 persons: 4 24 (1) The superintendent, who shall be an ex officio 4 25 nonvoting member and chairperson. 4 26 (2) Seven other members, five of whom shall have been, for 4 27 at least the previous five years, members in good standing of 4 28 either an Iowa state credit union or a credit union chartered 4 29 under the Federal Credit Union Act and having its principal 4 30 place of business in Iowa. 4 31 b. Two of the members may be public members; however, at 4 32 no time shall more than five of the members be directors or 4 33 employees of a credit union. 4 34 c. The members shall serve for three-year staggered terms 4 35 beginning and ending as provided by section 69.19. 5 1 2. The members of the board shall be appointed by the 5 2 governor. The governor may appoint the members of the board 5 3 from a list of nominees submitted to the governor by the 5 4 credit unions located in this state. 5 5 3. a. The board shall meet at least four times each year 5 6 and shall hold special meetings at the call of the 5 7 chairperson. 5 8 b. Four members constitute a quorum. 5 9 c. The board shall serve as an advisory board to the 5 10 superintendent on such matters as the superintendent shall 5 11 bring to the board's attention. 5 12 4. a. Each member of the board shall receive actual and 5 13 necessary expenses incurred in the discharge of official 5 14 duties. 5 15 b. Each member of the board may also be eligible to 5 16 receive compensation as provided in section 7E.6. 5 17 5. A member of the credit union review board shall not 5 18 take part in any action or participate in any decision when 5 19 the matter under consideration specifically relates to a 5 20 credit union of which the board member is a member. 5 21 Sec. 8. NEW SECTION. 533.108 RECORDS OF CREDIT UNION 5 22 DIVISION. 5 23 1. a. Records of the credit union division are public 5 24 records subject to the provisions of chapter 22, except as 5 25 provided in paragraph "b", and subsection 4. 5 26 b. Papers, documents, writings, reports, reports of 5 27 examinations and other information relating specifically to 5 28 the supervision and regulation of a specific state credit 5 29 union or of other persons by the superintendent pursuant to 5 30 the laws of this state are not public records and shall not be 5 31 open for examination or copying by the public or for 5 32 examination or publication by the news media. 5 33 2. The superintendent may notify the Iowa credit union 5 34 league of the name of any state credit union meeting any of 5 35 the following criteria: 6 1 a. The superintendent has reasonable cause to believe the 6 2 credit union may have violated any of the provisions of this 6 3 chapter. 6 4 b. The superintendent has reasonable cause to believe the 6 5 credit union may be in danger of becoming insolvent. 6 6 c. The credit union has been the subject of a report of 6 7 examination that the superintendent deems unsatisfactory in 6 8 any respect. 6 9 Thereafter, the superintendent may, with the written 6 10 consent of the credit union, give information secured from or 6 11 about that credit union to the Iowa credit union league. 6 12 3. a. The superintendent, deputy superintendent, 6 13 assistants or examiners shall not be subpoenaed in any cause 6 14 or proceeding to give testimony concerning papers, documents, 6 15 writings, reports, reports of examinations, or other 6 16 information relating to the supervision and regulation of a 6 17 specific state credit union or persons by the superintendent 6 18 pursuant to the laws of this state. 6 19 b. The papers, documents, writings, reports, reports of 6 20 examinations, and other information and records of the credit 6 21 union division that relate to the supervision and regulation 6 22 of a specific state credit union or persons shall not be 6 23 offered in evidence in a court or be subject to subpoena by a 6 24 party, except when relevant in the following matters: 6 25 (1) In actions or proceedings brought by the 6 26 superintendent. 6 27 (2) In matters in which an interested and proper party 6 28 seeks review of a decision of the superintendent. 6 29 (3) In actions or proceedings that arise out of the 6 30 criminal provisions of the laws of this state or of the United 6 31 States. 6 32 (4) In actions brought as shareholder derivative suits 6 33 against a credit union. 6 34 (5) In actions brought to recover moneys or to recover 6 35 upon an indemnity bond for embezzlement, misappropriation, or 7 1 misuse of credit union funds. 7 2 4. a. Information, records, and documents utilized for 7 3 the purpose of, or in the course of, investigation, 7 4 regulation, or examination of a specific state credit union, 7 5 received by the credit union division from some other 7 6 governmental entity that treats such information, records, and 7 7 documents as confidential, are confidential and shall not be 7 8 disclosed by the division and are not subject to subpoena. 7 9 b. Information, records, and documents under paragraph "a" 7 10 do not constitute a public record under chapter 22. 7 11 c. The disclosure of confidential information, records, 7 12 and documents which are not a public record to other 7 13 regulatory officials may be permitted by the superintendent 7 14 provided that the other officials are subject to, or agree to 7 15 comply with, standards of confidentiality comparable to those 7 16 contained in this section. 7 17 Sec. 9. NEW SECTION. 533.109 INSURANCE AND SURETY BOND. 7 18 1. The superintendent shall acquire good and sufficient 7 19 bond in a company authorized to do business in this state in 7 20 order to insure both of the following: 7 21 a. The faithful performance of the deputy superintendent, 7 22 assistants, examiners, and all other employees of the credit 7 23 union division. 7 24 b. Protection from any liability that may accrue in case 7 25 of the loss of property of a state credit union, or of a 7 26 member of a state credit union or of any other person, in the 7 27 course of an examination, investigation, or other function 7 28 required or allowed by the laws of this state. 7 29 2. The superintendent shall be bonded in accordance with 7 30 chapter 64, provided that such bond shall be in the amount of 7 31 one hundred thousand dollars. 7 32 Sec. 10. NEW SECTION. 533.110 REIMBURSEMENT OF EXPENSES. 7 33 1. The superintendent, deputy superintendent, assistants, 7 34 examiners, and other employees of the credit union division 7 35 are entitled to receive reimbursement for expenses incurred in 8 1 the performance of their duties. 8 2 2. The superintendent, and when specifically authorized by 8 3 the superintendent, the deputy superintendent, assistants, 8 4 examiners, and other employees of the division, are entitled 8 5 to receive reimbursement for expenses incurred while attending 8 6 conventions, meetings, conferences, schools, or seminars 8 7 relating to the performance of their duties. 8 8 Sec. 11. NEW SECTION. 533.111 EXPENSES OF THE CREDIT 8 9 UNION DIVISION. 8 10 1. a. All expenses required in the discharge of the 8 11 duties and responsibilities imposed upon the credit union 8 12 division, the superintendent, and the credit union review 8 13 board by the laws of this state shall be paid from fees 8 14 provided by the laws of this state and appropriated by the 8 15 general assembly from the general fund of the state. 8 16 b. All fees imposed under this chapter are payable to the 8 17 superintendent, who shall pay all fees and other moneys 8 18 received to the treasurer of state within the time required by 8 19 section 12.10. The treasurer of state shall deposit such 8 20 funds in the general fund of the state. 8 21 2. The superintendent shall account for receipts and 8 22 disbursements according to the separate duties imposed upon 8 23 the superintendent by the laws of this state, and each 8 24 separate duty shall be fiscally self-sustaining. 8 25 3. The credit union division may expend additional funds, 8 26 including funds for additional personnel, if the additional 8 27 expenditures are actual expenses that exceed the funds 8 28 budgeted for credit union examinations and directly result 8 29 from examinations of state credit unions. 8 30 a. The amounts necessary to fund the excess examination 8 31 expenses shall be collected from state credit unions being 8 32 regulated, and the collections shall be treated as repayment 8 33 receipts as defined in section 8.2. 8 34 b. The division shall notify in writing the legislative 8 35 fiscal bureau and the department of management when hiring 9 1 additional personnel. The written notification shall include 9 2 documentation that any additional expenditure related to such 9 3 hiring will be totally reimbursed to the general fund of the 9 4 state, and shall also include the division's justification for 9 5 hiring such personnel. The division must obtain the approval 9 6 of the department of management only if the number of 9 7 additional personnel to be hired exceeds the number of full- 9 8 time equivalent positions authorized by the general assembly. 9 9 4. a. All fees and other moneys collected shall be 9 10 deposited into the general fund of the state and expenses 9 11 required to be paid under this section shall be paid from 9 12 funds appropriated for those purposes. Moneys deposited into 9 13 the general fund of the state pursuant to this section shall 9 14 be subject to the requirements of section 8.60. 9 15 b. Funds appropriated to the credit union division shall 9 16 be subject at all times to the warrant of the director of 9 17 revenue and finance, drawn upon written requisition of the 9 18 superintendent or a designated representative, for the payment 9 19 of all salaries and other expenses necessary to carry out the 9 20 duties of the credit union division. 9 21 5. The division may accept reimbursement of expenses 9 22 related to the examination of a state credit union from the 9 23 national credit union administration or any other guarantor or 9 24 insurance plan authorized by this chapter. These 9 25 reimbursements shall be deposited into the general fund of the 9 26 state. 9 27 Sec. 12. NEW SECTION. 533.112 ANNUAL FEES – 9 28 DELINQUENCIES. 9 29 1. A state credit union shall pay to the superintendent an 9 30 annual fee as established by the superintendent. The fee 9 31 shall be based upon the actual operating costs of the credit 9 32 union division. 9 33 2. a. Failure of a state credit union to pay a fee 9 34 pursuant to subsection 1 within fifteen days after the fee is 9 35 due shall result in the fee being considered delinquent and a 10 1 penalty equal to five percent of the original fee may be 10 2 assessed for each day or part of a day the payment remains 10 3 delinquent. 10 4 b. A fee delinquency under this subsection may also 10 5 constitute grounds for revocation of the certificate of 10 6 approval of the credit union. 10 7 Sec. 13. NEW SECTION. 533.113 EXAMINATIONS. 10 8 1. The superintendent may do any or all of the following: 10 9 a. Make or cause to be made an examination of a state 10 10 credit union whenever the superintendent believes such 10 11 examination is necessary or advisable, but in no event less 10 12 frequently than once during each twenty-four-month period. 10 13 b. Make or cause to be made such limited examinations at 10 14 such times and with such frequency as the superintendent deems 10 15 necessary and advisable to determine the condition of any 10 16 state credit union and whether any person has violated the 10 17 provisions of this chapter. 10 18 c. Make or cause to be made an examination of any 10 19 corporation in which a state credit union owns shares. 10 20 d. Make or cause to be made an examination of any person 10 21 having business transactions or a relationship with any state 10 22 credit union, upon application to and order of the district 10 23 court of Polk county, when such examination is deemed 10 24 necessary and advisable in order to determine whether the 10 25 capital of the state credit union is impaired or whether the 10 26 safety of its deposits is imperiled. 10 27 e. Accept, in lieu of the examination of a state credit 10 28 union, an audit report conducted by a certified public 10 29 accounting firm selected from a list of firms previously 10 30 approved by the superintendent. The cost of the audit shall 10 31 be paid by the credit union. 10 32 2. a. A state credit union and all of its officers and 10 33 agents shall give to the representatives of the superintendent 10 34 free and unimpeded access to all books, papers, securities, 10 35 records, and other sources of information under their control. 11 1 b. A state credit union designated as serving 11 2 predominantly low-income members shall be reviewed during each 11 3 examination to ensure that such credit union is continuing to 11 4 meet the standards established by rule of the superintendent. 11 5 3. a. A report of examination shall be forwarded to the 11 6 chairperson of a state credit union within thirty days after 11 7 the completion of the examination. Within thirty days of the 11 8 receipt of this report, a meeting of the directors shall be 11 9 called by the credit union to consider matters contained in 11 10 the report and the action taken shall be set forth in the 11 11 minutes of the board. 11 12 b. The report of examination of any affiliate or of any 11 13 person examined as provided in this subsection shall not be 11 14 transmitted by the superintendent to any such affiliate or 11 15 person or to the board of directors of any credit union unless 11 16 authorized or requested by such affiliate or person. 11 17 4. a. Whenever the superintendent deems it necessary and 11 18 advisable, the superintendent may cause a meeting of the board 11 19 of directors of a state credit union to be held in such a 11 20 place and time and manner as the superintendent may direct. 11 21 b. The superintendent may present to the board at the 11 22 meeting any item the superintendent desires to bring to the 11 23 attention of the board, including but not limited to any 11 24 report of an examination required or allowed by this chapter, 11 25 any conclusions or projections drawn from a report of an 11 26 examination by the superintendent, any recommendations made 11 27 relative to a report of an examination, and any other matters 11 28 concerning the operation and condition of the state credit 11 29 union. 11 30 c. The state credit union shall cause the matters 11 31 presented at the meeting to be recorded in the minutes of the 11 32 meeting. 11 33 d. Each member of the board of directors shall furnish the 11 34 superintendent a statement on forms supplied by the 11 35 superintendent that the member is familiar with the matters 12 1 presented by the superintendent. 12 2 5. The superintendent may require any of the following 12 3 state credit unions to submit to an additional examination or 12 4 to an independent audit performed by a certified public 12 5 accounting firm as provided in subsection 1, paragraph "e", at 12 6 the expense of the state credit union: 12 7 a. A credit union where the records are inadequate. 12 8 b. A credit union in which the books have not been 12 9 balanced as of the end of the month not less than thirty days 12 10 previously. 12 11 c. A credit union whose affairs are in an unfavorable 12 12 condition. 12 13 6. The superintendent may furnish a copy of the report of 12 14 any or all examinations made of any state credit union and any 12 15 affiliate of a state credit union to any or all of the 12 16 following, including any official or supervising examiner of 12 17 any office or regulatory authority: 12 18 a. The national credit union administration. 12 19 b. The federal deposit insurance corporation. 12 20 c. The federal reserve system. 12 21 d. The office of the comptroller of the currency. 12 22 e. The office of thrift supervision. 12 23 f. The federal home loan bank and financial institution 12 24 regulatory authorities of other states. 12 25 Sec. 14. NEW SECTION. 533.114 ANNUAL REPORT OF 12 26 SUPERINTENDENT. 12 27 1. The superintendent shall report annually to the 12 28 governor in the manner and within the time required by chapter 12 29 7A. A copy of the report shall be furnished by the 12 30 superintendent to each state credit union and to the Iowa 12 31 credit union league and its affiliates. 12 32 2. In addition to the matters required by chapter 7A, the 12 33 annual report of the superintendent shall contain all of the 12 34 following: 12 35 a. A summary of applications approved or denied by the 13 1 superintendent pursuant to this chapter since the last 13 2 previous report. 13 3 b. A summary of the assets, liabilities, and capital 13 4 structures of all state credit unions, and a summary of the 13 5 volume of consumer installment credit outstanding per credit 13 6 union, as of December 31 of the year for which the report is 13 7 made. 13 8 c. A statement of the receipts and disbursements of funds 13 9 of the superintendent during the calendar year ending on the 13 10 preceding December 31 and of the funds on hand on that 13 11 December 31, including an estimate of the disbursements of 13 12 credit union division funds for consumer credit protection 13 13 during the year for which the report is made. 13 14 d. Information that the administrator of the Iowa consumer 13 15 credit code may require to be included. 13 16 e. A list of state credit unions that have been designated 13 17 as serving predominantly low-income members pursuant to 13 18 section 533.301, subsection 1. 13 19 f. Other information the superintendent deems appropriate 13 20 and advisable to disclose in the discharge of the duties 13 21 imposed upon the superintendent by this chapter. 13 22 Sec. 15. NEW SECTION. 533.115 RECIPROCITY. 13 23 1. Subject to rules of the superintendent, a credit union 13 24 organized in another state may do business in Iowa subject to 13 25 the applicable provisions of this chapter if credit unions 13 26 organized in Iowa may do business in the state in which the 13 27 out-of-state credit union is organized. 13 28 2. Notwithstanding subsection 1, an out-of-state credit 13 29 union shall meet the same deposit insurance requirements 13 30 established by this chapter for an Iowa state credit union 13 31 prior to doing business in Iowa. 13 32 Sec. 16. NEW SECTION. 533.116 ENFORCEMENT OF IOWA 13 33 CONSUMER CREDIT CODE. 13 34 1. The superintendent shall enforce the Iowa consumer 13 35 credit code with respect to state credit unions, as provided 14 1 in sections 537.2303, 537.2305, and 537.6105. 14 2 2. The superintendent shall cooperate with the 14 3 administrator of the Iowa consumer credit code as designated 14 4 in section 537.6103, and shall assist that administrator 14 5 whenever necessary to provide for the discharge of the duties 14 6 of that administrator. 14 7 3. Notwithstanding other provisions of this chapter to the 14 8 contrary, the superintendent shall furnish to the 14 9 administrator of the Iowa consumer credit code, access to or 14 10 copies of records in the custody of the division that relate 14 11 to a state credit union when necessary to enable the 14 12 administrator of the Iowa consumer credit code to enforce 14 13 chapter 537. 14 14 Sec. 17. NEW SECTION. 533.117 SMALL LOANS LEGISLATION. 14 15 This chapter does not apply to any person engaged in the 14 16 business of loaning money under chapter 536. 14 17 Sec. 18. NEW SECTION. 533.201 ORGANIZATION. 14 18 1. a. A group comprised of at least seven residents of 14 19 the state of Iowa may apply to the superintendent for 14 20 permission to organize a state credit union. 14 21 b. A state credit union shall be organized by delivering 14 22 to the superintendent articles of incorporation that state all 14 23 of the following: 14 24 (1) The name and location of the proposed credit union. 14 25 (2) The names and addresses of the subscribers to the 14 26 articles and the number of shares subscribed to by each. 14 27 (3) The share structure of the credit union. A credit 14 28 union may have more than one class of shares. The par value 14 29 of the shares of the credit union shall be established by the 14 30 board of directors. 14 31 2. The applicants shall prepare and adopt bylaws for the 14 32 general governance of the state credit union consistent with 14 33 the provisions of this chapter. 14 34 3. The articles and the bylaws, both executed in 14 35 duplicate, shall be forwarded with a fee of ten dollars to the 15 1 superintendent. 15 2 4. a. The superintendent shall determine whether the 15 3 articles and bylaws conform to the provisions of this chapter 15 4 within thirty days of receipt. 15 5 b. The superintendent shall notify the applicants of the 15 6 determination after review of the articles and bylaws. 15 7 c. If the decision is favorable, the superintendent shall 15 8 issue a certificate of approval, which shall be attached to 15 9 the duplicate articles of incorporation and returned, together 15 10 with the duplicate bylaws, to the applicants. 15 11 5. a. The applicants shall file the duplicate of the 15 12 articles of incorporation and the attached certificate of 15 13 approval with the county recorder of the county within which 15 14 the state credit union is to have its principal place of 15 15 business. 15 16 b. The county recorder shall record and index the 15 17 duplicate of the articles of incorporation and the attached 15 18 certificate of approval and return the articles of 15 19 incorporation and the certificate of approval, with the 15 20 recorder's certificate of record attached, to the 15 21 superintendent for permanent record. 15 22 c. The applicants shall then be a state credit union, 15 23 incorporated in accordance with the provisions of this 15 24 chapter. 15 25 6. In order to simplify the organization of state credit 15 26 unions, the superintendent shall cause to be prepared an 15 27 approved form of articles of incorporation and a form of 15 28 bylaws, consistent with this chapter, which shall be used by 15 29 state credit union incorporators. 15 30 7. Articles of incorporation may be amended by a favorable 15 31 vote of a majority of the members present at a meeting, if 15 32 that number constitutes a quorum and if the proposed amendment 15 33 was contained in the notice of the meeting. 15 34 8. Bylaws may be amended by any of the following methods: 15 35 a. The favorable vote of a majority of the members present 16 1 at a meeting, if that number constitutes a quorum and if the 16 2 proposed amendment was contained in the notice of the meeting. 16 3 b. The favorable vote of a majority of the members of the 16 4 board. 16 5 c. By a majority vote of members voting by mailed ballot, 16 6 ensuring the confidentiality of voters, according to 16 7 procedures specified by rule of the superintendent, requiring 16 8 at least twenty days' notice to all members. An announcement 16 9 shall be made to members of the results of the vote. Ballots 16 10 shall be preserved for a reasonable period of time following 16 11 the vote. 16 12 d. A combination of procedures as specified in paragraphs 16 13 "a" and "c", whereby members are allowed to vote either in 16 14 person at a meeting or by mailed ballot, according to 16 15 procedures specified by rule of the superintendent. If the 16 16 proposed amendment receives a favorable majority of the total 16 17 votes cast in person and by mailed ballot, the bylaws shall be 16 18 amended. 16 19 9. An amendment to the articles of incorporation or bylaws 16 20 must be approved by the superintendent before the amendment 16 21 becomes effective. 16 22 10. The original articles or amended articles may contain 16 23 a provision eliminating or limiting the personal liability of 16 24 a director, officer, or employee of the state credit union or 16 25 its shareholders for monetary damages for breach of fiduciary 16 26 duty as a director, officer, or employee, provided that the 16 27 provision does not eliminate or limit the liability of a 16 28 director, officer, or employee for any breach of the 16 29 director's, officer's, or employee's duty of loyalty to the 16 30 state credit union or its shareholders, for acts or omissions 16 31 not in good faith or that involve intentional misconduct or a 16 32 knowing violation of law, or for any transaction from which 16 33 the director, officer, or employee derives an improper 16 34 personal benefit. However, a provision shall not eliminate or 16 35 limit the liability of a director, officer, employee, or 17 1 shareholder for any act or omission occurring prior to the 17 2 date when the provision in the articles of incorporation 17 3 becomes effective. 17 4 Sec. 19. NEW SECTION. 533.202 COMMON BOND – MEMBERSHIP. 17 5 1. a. State credit union organization shall be available 17 6 to groups of individuals who have a common bond of association 17 7 such as, but not limited to, occupation, common employer, or 17 8 residence within specified geographic boundaries. 17 9 b. Changes in the common bond may be made by the board of 17 10 directors. 17 11 2. a. The membership of a state credit union consists of 17 12 those persons in the common bonds that have subscribed to one 17 13 ownership share and have complied with the other requirements 17 14 specified by the articles of incorporation and bylaws. 17 15 b. Organizations, incorporated or otherwise, may be 17 16 members. 17 17 c. Unless the credit union's bylaws state otherwise, once 17 18 a person or organization becomes a member of a state credit 17 19 union in accordance with this chapter, the person or 17 20 organization may remain a member of that credit union, and 17 21 retain all membership privileges, until the person or 17 22 organization chooses to withdraw from the membership of the 17 23 credit union, or is expelled pursuant to section 533.210. 17 24 Sec. 20. NEW SECTION. 533.203 FISCAL YEAR – MEMBERSHIP 17 25 MEETINGS. 17 26 1. The fiscal year of all state credit unions shall end 17 27 December 31. 17 28 2. Annual meetings shall be held, and special meetings may 17 29 be held, in the manner indicated in the bylaws. 17 30 a. At all meetings, a member shall have one vote 17 31 regardless of the number of or class of shares held by the 17 32 member. 17 33 b. There shall be no voting by proxy. 17 34 c. A member other than a natural person may cast a single 17 35 vote through a delegated agent. 18 1 3. a. The majority of members present at any meeting may 18 2 vote to modify, amend, or reverse any act of the board of 18 3 directors or instruct the board to take action not 18 4 inconsistent with the articles, bylaws, or this chapter. 18 5 b. In order to be binding upon the board of directors, any 18 6 action taken by the membership to modify, amend, or reverse an 18 7 act of the board, or to instruct the board to take action, 18 8 requires an affirmative vote of a majority of all eligible 18 9 members obtained by submitting the modification, amendment, or 18 10 reversal to the members by mail ballot, pursuant to rules 18 11 adopted by the superintendent. 18 12 Sec. 21. NEW SECTION. 533.204 ELECTION OF BOARD. 18 13 1. At the organizational meeting a board of directors of 18 14 not less than nine members shall be elected to hold office for 18 15 such terms as the bylaws provide and until successors are 18 16 elected and qualified. 18 17 2. At each annual meeting one member shall be elected to 18 18 fill each position vacated by reason of an expiring term or 18 19 other cause. 18 20 3. Pursuant to rules adopted by the superintendent, state 18 21 credit unions may allow members to vote on the election of 18 22 directors via electronic means including, but not limited to, 18 23 the internet or telephone. 18 24 4. A record of the names and addresses of the directors, 18 25 officers, and committee persons shall be filed with the 18 26 superintendent within ten days following each election. 18 27 5. A state credit union wishing to maintain a board of 18 28 directors of less than nine members may apply to the 18 29 superintendent for permission to reduce the required number of 18 30 directors. An application to reduce the required number of 18 31 directors under this subsection must demonstrate both of the 18 32 following: 18 33 a. The application is necessitated by a hardship or other 18 34 special circumstance. 18 35 b. A lesser number of directors is in the best interest of 19 1 the credit union and its members. 19 2 In no event may the superintendent allow fewer than seven 19 3 directors on a credit union board. 19 4 Sec. 22. NEW SECTION. 533.205 BOARD OF DIRECTORS – 19 5 DUTIES. 19 6 1. Within five days following the organizational meeting 19 7 and each annual meeting, the directors shall elect the 19 8 following officers from the membership of the board of 19 9 directors: 19 10 a. A chairperson of the board. 19 11 b. A vice chairperson. 19 12 c. A secretary. 19 13 d. A chief financial officer whose title shall be 19 14 designated by the board. 19 15 2. a. The board of directors shall appoint the following 19 16 committees: 19 17 (1) A credit committee of not less than three members. 19 18 (2) An auditing committee of not less than three members. 19 19 b. The board may also appoint alternate members of the 19 20 credit committee. 19 21 c. Only a member of the board or a member of the state 19 22 credit union may be appointed to the credit committee or to 19 23 the auditing committee. 19 24 d. The board may appoint an executive committee to act on 19 25 its behalf. 19 26 3. The duties and responsibilities of a director and of 19 27 the board of directors shall include, but are not limited to, 19 28 all of the following: 19 29 a. General management of the affairs of the state credit 19 30 union. 19 31 b. Setting the amount of the surety bond that shall be 19 32 required of all officers and employees handling money. 19 33 c. Attendance at no less than seventy-five percent of the 19 34 regular board meetings held during the calendar year. 19 35 d. Periodic review of the original records of the state 20 1 credit union, or comprehensive summaries prepared by the 20 2 officers of the credit union, pertaining to loans, security 20 3 interests, and investments. 20 4 e. Review of the adequacy of the state credit union's 20 5 internal controls. 20 6 f. Periodic review of utilization of security measures. 20 7 g. Establishing education and training programs to ensure 20 8 that the director possesses adequate knowledge to manage the 20 9 affairs of the state credit union. 20 10 4. a. Directors of a state credit union shall discharge 20 11 the duties of their position in good faith and with that 20 12 diligence, care, and skill which ordinarily prudent persons 20 13 would exercise under similar circumstances in like positions. 20 14 b. The directors have a continuing responsibility to 20 15 assure themselves that the state credit union is being managed 20 16 according to law and that the practices and policies adopted 20 17 by the board are being implemented. 20 18 5. a. The board of directors shall name or employ an 20 19 individual who performs active executive or official duties 20 20 for the state credit union as its chief executive officer. 20 21 b. The board shall fix the tenure and provide for the 20 22 reasonable compensation of the chief executive officer. 20 23 c. The chief executive officer may be a member of the 20 24 board of directors. 20 25 6. a. The chief executive officer or the chief executive 20 26 officer's designee shall determine the compensation and tenure 20 27 of employees of the state credit union. 20 28 b. An employee of the state credit union shall not be a 20 29 member of the board of directors. 20 30 c. For purposes of this section, an employee of the state 20 31 credit union means an individual employed by the state credit 20 32 union other than the chief executive officer. 20 33 7. A state credit union shall not pay an overdraft of a 20 34 director, officer, or employee of the state credit union on an 20 35 account at the state credit union, unless the payment of funds 21 1 is made in accordance with either of the following: 21 2 a. A written, preauthorized, interest-bearing extension of 21 3 credit plan that specifies a method of repayment. 21 4 b. A written, preauthorized transfer of collected funds 21 5 from another account of the account holder at the state credit 21 6 union. 21 7 Sec. 23. NEW SECTION. 533.206 MEETINGS OF THE BOARD. 21 8 Unless the bylaws provide otherwise, the board of directors 21 9 may permit any and all directors to participate in all except 21 10 one meeting per year of the board of directors through the use 21 11 of any means of communication by which all directors 21 12 participating in the meeting may simultaneously hear each 21 13 other and communicate during the meeting. A director 21 14 participating in a meeting by this means is deemed to be 21 15 present at the meeting. 21 16 Sec. 24. NEW SECTION. 533.207 CREDIT COMMITTEE. 21 17 1. The credit committee shall have responsibility for the 21 18 general supervision of all loans to members. 21 19 2. Applications for loans shall be on a form approved by 21 20 the credit committee. 21 21 a. All applications shall set forth the purpose for which 21 22 the loan is desired, the security, if any, offered and such 21 23 other data as may be required. 21 24 b. Within the meaning of this section, an assignment of 21 25 shares or deposits or the endorsement of a note may be deemed 21 26 security. 21 27 3. At least a majority of the members of the credit 21 28 committee shall review and act on all loan applications and 21 29 may grant approval, or the credit committee, with the prior 21 30 approval of the board of directors, may grant one or more loan 21 31 officers the power to approve or reject loans subject to 21 32 written conditions and regulations adopted by the credit 21 33 committee. 21 34 4. The credit committee shall meet as often as may be 21 35 necessary after due notice to each member. 22 1 Sec. 25. NEW SECTION. 533.208 AUDITING COMMITTEE. 22 2 The auditing committee shall perform the following 22 3 functions: 22 4 1. Make or cause to be made an examination of the affairs 22 5 of the state credit union at least annually, including an 22 6 audit of its financial records. If the committee feels such 22 7 action to be necessary, the committee shall call the members 22 8 together after the audit and submit to them its report. 22 9 2. Make or cause to be made an annual report and submit it 22 10 at the annual meeting of the members. 22 11 3. Suspend by unanimous vote any officer, director, or 22 12 member of the committee and call the members together to act 22 13 on the suspension, if the committee deems the action to be 22 14 necessary to the proper conduct of the state credit union. 22 15 The members at the meeting may sustain the suspension and 22 16 remove the officer, director, or member permanently or may 22 17 reinstate the officer, director, or member. 22 18 4. Call a special meeting of state credit union members by 22 19 majority vote to consider a matter to be submitted by the 22 20 auditing committee. 22 21 Sec. 26. NEW SECTION. 533.209 CONFLICTS OF INTEREST. 22 22 1. A director, committee member, officer, or employee of a 22 23 state credit union shall not directly or indirectly 22 24 participate in either the deliberation upon or the 22 25 determination of any matter in which the director, committee 22 26 member, officer, or employee has a direct or indirect 22 27 interest. 22 28 2. For the purposes of this section, an interest may 22 29 include, but is not limited to, a pecuniary or familial 22 30 interest. 22 31 Sec. 27. NEW SECTION. 533.210 EXPULSION OF MEMBER. 22 32 1. The board of directors may expel any member who has 22 33 failed to do either of the following: 22 34 a. Carry out the member's obligations to the state credit 22 35 union. 23 1 b. Comply with the state credit union's bylaws. 23 2 2. A member may be expelled by a majority vote of the 23 3 board of directors at a regular or special meeting of the 23 4 board. 23 5 a. An expelled member may request a hearing before the 23 6 membership of the state credit union, which shall be held 23 7 within sixty days of an expelled member's request. 23 8 b. At the hearing, the membership may reinstate the 23 9 expelled member by majority vote, upon terms and conditions 23 10 prescribed at the hearing. 23 11 3. Any member may withdraw from the state credit union at 23 12 any time, but advance notice of withdrawal may be required as 23 13 provided in this section. 23 14 4. After deducting all amounts due from the member to the 23 15 state credit union and the amount necessary to honor 23 16 outstanding share drafts drawn against accounts of the member, 23 17 all amounts paid on shares or as deposits of an expelled or 23 18 withdrawing member, along with accrued dividends and interest 23 19 to the date of expulsion or withdrawal, shall be paid to that 23 20 member. 23 21 5. Upon expulsion or withdrawal of a member from a state 23 22 credit union, or at any other time, the credit union may 23 23 require sixty days' notice of intention to withdraw shares and 23 24 thirty days' notice of intention to withdraw deposits, except 23 25 that a credit union shall not at any time require notice of 23 26 withdrawal with respect to funds that are subject to 23 27 withdrawal by share drafts. 23 28 6. Withdrawing or expelled members shall have no further 23 29 rights in the state credit union. However, withdrawing or 23 30 expelled members shall not be released from any remaining 23 31 liability to the credit union because of the expulsion or 23 32 withdrawal. 23 33 Sec. 28. NEW SECTION. 533.211 SUSPENSION OR RESTRICTION 23 34 OF SERVICES. 23 35 1. A state credit union may suspend or deny certain 24 1 services to members who have performed any of the following 24 2 actions: 24 3 a. Caused a loss to the state credit union. 24 4 b. Violated the membership agreement or any policy adopted 24 5 by the board. 24 6 c. Been physically or verbally abusive to state credit 24 7 union members or staff. 24 8 2. Members with suspended services may maintain a share 24 9 account, and continue to vote at annual and special meetings. 24 10 Sec. 29. NEW SECTION. 533.212 USE OF NAME "CREDIT UNION" 24 11 REQUIREMENTS – RESTRICTIONS – EXCEPTIONS. 24 12 1. A state credit union organized in accordance with this 24 13 chapter shall include the words "credit union" in its name. 24 14 b. All credit union offices shall be identified by use of 24 15 the credit union's full name. 24 16 c. The full name of a credit union shall be used in all 24 17 legal documents of the credit union. 24 18 2. a. Notwithstanding subsection 1, a person other than a 24 19 state credit union shall not use a name or title containing 24 20 the words "credit union", or any derivation, and shall not 24 21 represent in advertising or otherwise that the person is 24 22 conducting business as a credit union, except as provided in 24 23 subsection 3. 24 24 b. A person who violates paragraph "a" may be enjoined 24 25 from the use of words, advertising, or other representation 24 26 prohibited by paragraph "a". 24 27 3. The prohibitions contained in subsection 2 do not apply 24 28 to any of the following entities: 24 29 a. A credit union organized under this chapter or the laws 24 30 of another state. 24 31 b. A credit union organized under the Federal Credit Union 24 32 Act, 12 U.S.C. } 1751 et seq. 24 33 c. The Iowa credit union league, a chapter, affiliate, or 24 34 subsidiary of the Iowa credit union league or a political 24 35 action committee formed pursuant to the Federal Election 25 1 Campaign Act, 2 U.S.C. } 431 et seq., or chapter 56 by the 25 2 Iowa credit union league or by credit unions organized under 25 3 this chapter or federal law. 25 4 d. A joint service center operated by two or more state or 25 5 other credit unions where credit union services are made 25 6 available to credit union members. 25 7 e. An organization formed for educational purposes in 25 8 association with an accredited elementary or secondary school 25 9 that engages in receipt of deposits of no more than twenty 25 10 dollars per depositor and uses the words "educational credit 25 11 union" in its name. An educational credit union must be 25 12 affiliated with a state credit union organized under this 25 13 chapter. Notwithstanding this recognition given to an 25 14 educational credit union, an educational credit union is not a 25 15 state credit union within the scope or regulation of this 25 16 chapter. 25 17 Sec. 30. NEW SECTION. 533.213 CORPORATE CENTRAL CREDIT 25 18 UNION. 25 19 1. A corporate central credit union may be established. 25 20 a. Credit unions organized under this chapter, the Federal 25 21 Credit Union Act, or any other credit union act and credit 25 22 union organizations may be members. 25 23 b. Regulated financial institutions, nonprofit 25 24 organizations, and cooperative organizations may also be 25 25 members to the extent and manner provided for in the bylaws of 25 26 the corporate central credit union. 25 27 2. A corporate central credit union shall not be required 25 28 to transfer to its legal reserve more than five percent of its 25 29 net income for the year. 25 30 3. A corporate central credit union shall have all the 25 31 powers, restrictions, and obligations imposed upon, or granted 25 32 to a state credit union under this chapter, except that the 25 33 corporate central credit union may also exercise any of the 25 34 following additional powers subject to the adoption of rules 25 35 by the superintendent pursuant to chapter 17A and with the 26 1 prior written approval of the superintendent: 26 2 a. Borrow any amount from any source. 26 3 b. Invest in or purchase obligations or securities or 26 4 other designated investments to the same extent authorized for 26 5 other supervised financial institutions. 26 6 c. Invest in or acquire shares, stocks, or other 26 7 obligations of an organization providing services that are 26 8 associated with the operations of credit unions. However, the 26 9 aggregate amount invested pursuant to this paragraph shall not 26 10 exceed fifty percent of the total of all reserves and 26 11 undivided earnings of the corporate central credit union. 26 12 d. Buy or sell investment securities and corporate bonds 26 13 that are evidences of indebtedness. However, the purchase or 26 14 sale is limited to marketable obligations of a corporation or 26 15 state or federal agency issued without recourse. 26 16 e. Establish one or more capital accounts in the same 26 17 manner as if it were a federal credit union. 26 18 f. Sell all or part of its assets to another corporate 26 19 central credit union and assume the liabilities of a selling 26 20 corporate central credit union if the action is approved by 26 21 the majority vote of the board of directors at a meeting 26 22 called for that purpose. 26 23 g. Invest in the shares or deposits of another similarly 26 24 organized corporate central credit union, or central liquidity 26 25 facility. 26 26 h. Make other investments approved by the superintendent. 26 27 Sec. 31. NEW SECTION. 533.301 POWERS. 26 28 A state credit union shall have the power to do all of the 26 29 following: 26 30 1. Receive payments for ownership shares, other shares, or 26 31 as deposits from any or all of the following: 26 32 a. Members of the state credit union. 26 33 b. Nonmembers as prescribed by rule where the state credit 26 34 union is serving predominantly low-income members. Rules 26 35 adopted allowing nonmember deposits in state credit unions 27 1 serving predominantly low-income members shall be designed 27 2 solely to meet the needs of the low-income members. 27 3 c. Other state credit unions. 27 4 d. Federal, state, county, and city governments. 27 5 2. Make loans or leases to members. 27 6 3. Make loans to a cooperative society or other 27 7 organization having membership in the state credit union. 27 8 4. Make deposits in state and national banks, state and 27 9 federal savings banks or savings and loan associations, and 27 10 state and federal credit unions, the accounts of which are 27 11 insured by the federal deposit insurance corporation or the 27 12 national credit union share insurance fund. 27 13 5. Make investments in any or all of the following: 27 14 a. Time deposits in state and national banks, state and 27 15 federal savings banks or savings and loan associations, and 27 16 state and federal credit unions, the deposits of which are 27 17 insured by the federal deposit insurance corporation or the 27 18 national credit union share insurance fund. 27 19 b. Obligations, participations, or other instruments of or 27 20 issued by, or fully guaranteed as to principal and interest by 27 21 the United States government or any agency of the United 27 22 States government, or any trust or trusts established for 27 23 investing directly or collectively in the United States 27 24 government or any agency of the United States government. 27 25 c. General obligations of this state and any subdivision 27 26 of this state. 27 27 d. Purchase of notes of liquidating credit unions with the 27 28 approval of the superintendent. 27 29 e. Shares and deposits in other credit unions. 27 30 f. Shares, stocks, loans, and other obligations or a 27 31 combination of shares, stocks, loans, and other obligations of 27 32 an organization, corporation, or association, provided the 27 33 membership or ownership, as the case may be, of the 27 34 organization, corporation, or association is primarily 27 35 confined or restricted to credit unions or organizations of 28 1 credit unions, and provided that the purpose of the 28 2 organization, corporation, or association is primarily 28 3 designed to provide services to credit unions, organizations 28 4 of credit unions, or credit union members. However, the 28 5 aggregate amount invested pursuant to this paragraph shall not 28 6 exceed five percent of the assets of the credit union. 28 7 g. Obligations issued by federal land banks, federal 28 8 intermediate credit banks, banks for cooperatives, or any of 28 9 the federal farm credit banks. 28 10 h. Commercial paper issued by United States corporations 28 11 as defined by rule. 28 12 i. Corporate bonds as defined by and subject to terms and 28 13 conditions imposed by the superintendent, provided that the 28 14 superintendent shall not approve investment in corporate bonds 28 15 unless the bonds are rated in the two highest grades of 28 16 corporate bonds by a nationally accepted rating agency. 28 17 6. Borrow money as provided in this chapter. 28 18 7. Assess penalties as may be provided by the bylaws. 28 19 8. Sue and be sued. 28 20 9. Make contracts. 28 21 10. Purchase, hold and dispose of property necessary and 28 22 incidental to its operation, except that any property acquired 28 23 through foreclosure shall be disposed of within a period not 28 24 to exceed ten years. 28 25 11. Exercise such incidental powers as may be necessary or 28 26 requisite to enable the state credit union to carry on the 28 27 business effectively for which it is incorporated. 28 28 12. Apply for share account and deposit account insurance 28 29 that meets the requirements of this chapter, and take all 28 30 actions necessary to maintain an insured status. 28 31 13. Serve a group of persons having an insufficient number 28 32 of members to form or conduct the affairs of a separate credit 28 33 union, upon the approval of the superintendent. There shall 28 34 be no requirement for the existence of a common bond 28 35 relationship between the group and the credit union affecting 29 1 that service. 29 2 14. Deposit with a credit union that has been in existence 29 3 for not more than a year, an amount not to exceed twenty-five 29 4 percent of the assets of the new credit union, but only one 29 5 credit union may, at any time, make such a deposit. 29 6 15. Acquire the conditional sales contracts, promissory 29 7 notes, or other similar instruments executed by its members, 29 8 but the rate of interest existing on the instruments shall not 29 9 exceed the highest rate charged by the acquiring credit union 29 10 on its outstanding loans. 29 11 16. a. Sell, participate in, or discount the obligations 29 12 of its members with or without recourse. 29 13 b. Purchase the obligations of credit union members, 29 14 provided the obligations meet the requirements of this 29 15 chapter. 29 16 17. Acquire and hold shares in a corporation engaged in 29 17 providing and operating facilities through which a state 29 18 credit union and its members may engage, by means of either 29 19 the direct transmission of electronic impulses to and from the 29 20 credit union or the recording of electronic impulses or other 29 21 indicia of a transaction for delayed transmission to the 29 22 credit union, in transactions in which such credit union is 29 23 otherwise permitted to engage pursuant to applicable law, 29 24 subject to the prior approval of the superintendent. 29 25 18. Engage in any transaction otherwise permitted by this 29 26 chapter and applicable law, by means of either the direct 29 27 transmission of electronic impulses to or from the state 29 28 credit union or the recording of electronic impulses or other 29 29 indicia of a transaction for delayed transmission to the state 29 30 credit union. 29 31 a. Subject to the provisions of chapter 527, a state 29 32 credit union may utilize, establish, or operate, alone or with 29 33 one or more other credit unions, banks incorporated under 29 34 chapter 524 or federal law, savings and loan associations 29 35 incorporated under chapter 534 or federal law, corporations 30 1 licensed under chapter 536A, or third parties, the satellite 30 2 terminals permitted under chapter 527, by means of which the 30 3 credit union may transmit to or receive from any member 30 4 electronic impulses constituting transactions pursuant to this 30 5 subsection. However, such utilization, establishment, or 30 6 operation shall be lawful only when in compliance with chapter 30 7 527. 30 8 b. This subsection shall not be construed as authority for 30 9 any person to engage in transactions not otherwise permitted 30 10 by applicable law, and shall not be deemed to repeal, replace, 30 11 or in any other way affect any applicable law or rule 30 12 regarding the maintenance of or access to financial 30 13 information maintained by any credit union. 30 14 19. Establish one or more state credit union offices other 30 15 than its main office. 30 16 a. A credit union may furnish at any of its offices all 30 17 credit union services ordinarily furnished to the membership 30 18 at its principal place of business. 30 19 b. The central executive and official business and 30 20 recordkeeping functions of a credit union shall be exercised 30 21 at its principal place of business or at another credit union 30 22 office or a location authorized by the superintendent for 30 23 these functions. 30 24 c. A credit union shall file an informational statement in 30 25 the form prescribed by the superintendent prior to opening a 30 26 credit union office. 30 27 d. A credit union office shall not be opened without a 30 28 certificate to establish a credit union office issued by the 30 29 superintendent. 30 30 e. The establishment of a credit union office must be 30 31 reasonably necessary for service to, and in the best interests 30 32 of, the members of the credit union, and shall not endanger 30 33 the safety and soundness of the credit union opening the 30 34 office. 30 35 f. A credit union may join with one or more credit unions 31 1 in the operation of an office facility to meet the service 31 2 needs of its members. 31 3 20. Contract with another state credit union to furnish 31 4 services which either could otherwise perform. Contracted 31 5 services provided under this subsection are subject to 31 6 regulation and examination like other services. 31 7 21. Purchase insurance or make the purchase of insurance 31 8 available for members. 31 9 22. Make a second mortgage on real property to secure a 31 10 loan made by the state credit union, pursuant to rules adopted 31 11 by the superintendent. 31 12 23. Charge fees and penalties and apply them to income. 31 13 24. a. (1) Act as agent of the federal government when 31 14 requested by the secretary of the United States department of 31 15 treasury. 31 16 (2) Perform such services as may be required in connection 31 17 with the collection of taxes and other obligations due the 31 18 United States and the lending, borrowing, and repayment of 31 19 moneys by the United States. 31 20 (3) Act as a depository of public money when designated 31 21 for that purpose. 31 22 b. (1) Act as agent of this state when requested by the 31 23 treasurer of state. 31 24 (2) Perform such services as may be required in connection 31 25 with the collection of taxes and other obligations due this 31 26 state and the lending, borrowing, and repayment of moneys by 31 27 this state. 31 28 (3) Act as a depository of public moneys when designated 31 29 for that purpose. 31 30 25. Receive public funds pursuant to chapter 12C. 31 31 26. Engage in any activity authorized by the 31 32 superintendent which would be permitted if the state credit 31 33 union were organized under the Federal Credit Union Act, 12 31 34 U.S.C. } 1751, et seq. 31 35 27. Pledge its assets to secure the deposit of public 32 1 funds. 32 2 28. Provide indemnity for the director, officer, or 32 3 employee in the same fashion as a corporation organized under 32 4 chapter 490. However, where those sections provide for action 32 5 by shareholders, the provision is applicable to action by 32 6 members of the state credit union, and where the sections have 32 7 reference to the corporation organized under chapter 490, the 32 8 provision is applicable to a credit union organized under this 32 9 chapter. 32 10 29. Set off a member's accounts against any of the 32 11 member's debts or liabilities owed the state credit union 32 12 pursuant to an agreement entered into between the member and 32 13 the credit union. The credit union shall also have a lien on 32 14 the shares and deposits of a member for any sum due to the 32 15 credit union from the member or for any loan endorsed by the 32 16 member. 32 17 30. All other powers determined by the superintendent to 32 18 be appropriate for a state credit union. 32 19 Sec. 32. NEW SECTION. 533.302 CAPITAL. 32 20 1. The capital of a state credit union shall consist of 32 21 the sum of the share deposits made by its members plus all 32 22 reserves and undivided earnings. 32 23 2. A state credit union may accept deposits to individual 32 24 capital accounts that shall be considered the secondary or 32 25 alternative capital of the credit union and shall be available 32 26 to cover losses of the credit union that exceed reserves and 32 27 undivided earnings. 32 28 a. A secondary or alternative capital account shall not be 32 29 withdrawn or transferred by the depositor except upon prior 32 30 written notice to, and termination of membership in, the state 32 31 credit union and in accordance with rules adopted by the 32 32 superintendent. 32 33 b. The aggregate amount that may be held in a secondary or 32 34 alternative capital account by any one depositor or group of 32 35 depositors may be determined by the board of directors of a 33 1 state credit union, subject to the approval of the 33 2 superintendent. 33 3 c. At the option of the state credit union, the secondary 33 4 or alternative capital account may earn a dividend, and may or 33 5 may not be insured. 33 6 Sec. 33. NEW SECTION. 533.303 RESERVES. 33 7 1. At the end of each dividend period, but no less than 33 8 quarterly, the gross income of the state credit union shall be 33 9 determined. 33 10 2. A legal reserve against losses on loans and against 33 11 such other losses as may be specified by rule shall be set 33 12 aside from the gross income in accordance with the following 33 13 schedule: 33 14 a. A state credit union in operation for more than four 33 15 years and having assets of five hundred thousand dollars or 33 16 more shall set aside the following amounts in the following 33 17 order: 33 18 (1) Ten percent of the gross income until the legal 33 19 reserve equals four percent of the total outstanding loans and 33 20 risk assets. 33 21 (2) Five percent of the gross income until the legal 33 22 reserve equals six percent of the total outstanding loans and 33 23 risk assets. 33 24 b. A state credit union in operation for less than four 33 25 years or having assets of less than five hundred thousand 33 26 dollars shall set aside the following amounts in the order set 33 27 forth: 33 28 (1) Ten percent of the gross income until the legal 33 29 reserve equals seven and one-half percent of the total 33 30 outstanding loans and risk assets. 33 31 (2) Five percent of the gross income until the legal 33 32 reserve equals ten percent of the total outstanding loans and 33 33 risk assets. 33 34 3. a. If the legal reserve falls below the percent of the 33 35 total outstanding loans and risk assets required for a credit 34 1 union by this section, the state credit union shall replenish 34 2 the legal reserve by regular contributions in the amounts 34 3 needed to reach the required reserve. However, the 34 4 superintendent may waive the reserve requirement when in the 34 5 superintendent's opinion the waiver is necessary or desirable. 34 6 b. The legal reserve shall belong to the state credit 34 7 union and shall be used to meet losses. 34 8 c. The reserve shall not be distributed to members as 34 9 interest or dividends except on liquidation of the state 34 10 credit union or in accordance with a plan approved by the 34 11 superintendent. 34 12 4. The superintendent may require a state credit union to 34 13 set aside additional amounts as a special reserve if an 34 14 examination of assets discloses that the legal reserve of the 34 15 credit union is inadequate. 34 16 5. A state credit union shall maintain an adequate 34 17 "allowance for loan and lease losses" account and such other 34 18 valuation allowance accounts as may be necessary to provide 34 19 for the full and fair disclosure, in the credit union's 34 20 financial statements, of the assets, liabilities, and equity 34 21 of the credit union. 34 22 6. For the purpose of establishing legal reserves, the 34 23 following shall not be considered risk assets: 34 24 a. Cash on hand. 34 25 b. Deposits and shares in federally insured banks, savings 34 26 banks, and credit unions. 34 27 c. Assets which are insured by, fully guaranteed as to 34 28 principal and interest by, or due from the United States 34 29 government, its agencies, and instrumentalities. 34 30 d. Loans to other credit unions. 34 31 e. Student loans insured under the provisions of 20 U.S.C. 34 32 } 1071-1087 or similar state programs. 34 33 f. Loans insured by the federal housing administration 34 34 under 12 U.S.C. } 1703. 34 35 g. Loans fully insured or guaranteed by the federal 35 1 government, a state government, or any agency of either. 35 2 h. Common trust investments which deal in investments 35 3 authorized in section 533.301. 35 4 i. Prepaid expenses. 35 5 j. Accrued interest on nonrisk investments. 35 6 k. Furniture and equipment. 35 7 l. Land and buildings. 35 8 m. Loans fully secured by a pledge of shares within the 35 9 credit union. 35 10 n. Deposits in the national credit union share insurance 35 11 fund. 35 12 o. Real estate loans in transit to the secondary market as 35 13 specified by rule. 35 14 Sec. 34. NEW SECTION. 533.304 INVESTMENT IN CERTAIN 35 15 SHARES OR EQUITY INTERESTS. 35 16 1. For purposes of this section, unless the context 35 17 otherwise requires: 35 18 a. "Equity interests" means limited partnership interests 35 19 and other equity investments in which liability is limited to 35 20 the amount of the investment, but does not mean general 35 21 partnership interests or other interests involving general 35 22 liability. 35 23 b. "Small business" means a corporation, partnership, 35 24 proprietorship, or other entity formed under the laws of the 35 25 United States, or a state, district, or territory of the 35 26 United States, that meets the appropriate United States small 35 27 business administration definition of small business and that 35 28 is principally engaged in the development or exploitation of 35 29 inventions, technological improvements, new processes, or 35 30 other products not previously generally available in this 35 31 state, or other investments which provide an economic benefit 35 32 to this state. 35 33 c. "Venture capital fund" means a corporation, 35 34 partnership, proprietorship, or other entity, formed under the 35 35 laws of the United States, or the laws of a state, district, 36 1 or territory of the United States, whose principal business is 36 2 or will be the making of investments in and the provision of 36 3 significant managerial assistance to small businesses that 36 4 meet the United States small business administration 36 5 definition of small business. 36 6 2. A state credit union may invest in either of the 36 7 following to the extent that the total investments under this 36 8 section shall not be more than five percent of the credit 36 9 union's assets: 36 10 a. Shares or equity interests in venture capital funds 36 11 that agree to invest an amount equal to at least fifty percent 36 12 of the credit union's investment in small businesses having 36 13 their principal offices within this state and having either 36 14 more than one-half of their assets within this state or more 36 15 than one-half of their employees employed within this state. 36 16 b. Shares or equity interests in small businesses having 36 17 their principal offices within this state and having either 36 18 more than one-half of their assets within this state or more 36 19 than one-half of their employees employed within this state. 36 20 A state credit union shall not invest in more than twenty 36 21 percent of the total capital and surplus of any one small 36 22 business under this paragraph. 36 23 Sec. 35. NEW SECTION. 533.305 INVESTMENT IN BANKS OR 36 24 SAVINGS BANKS – REQUIRED FINDINGS. 36 25 1. INVESTMENTS IN BANKS. A state credit union may, with 36 26 the prior approval of the superintendent, invest in the 36 27 capital stock, obligations, or other securities of a bank. 36 28 2. INVESTMENT IN SAVINGS BANKS. A state credit union may, 36 29 with the prior approval of the superintendent, invest in the 36 30 capital stock, obligations, or other securities of a savings 36 31 bank. 36 32 3. FINDINGS REQUIRED. The superintendent shall not grant 36 33 an approval under subsection 1 or 2, unless the superintendent 36 34 makes one of the following findings: 36 35 a. Based upon a preponderance of the evidence presented, 37 1 the proposed investment will not have the immediate effect of 37 2 significantly reducing competition between depository 37 3 financial institutions located in the same community as the 37 4 institution whose shares would be acquired. 37 5 b. Based upon a preponderance of the evidence presented, 37 6 the proposed investment would have an anticompetitive effect 37 7 as described in paragraph "a", but other factors, specifically 37 8 cited, outweigh the anticompetitive effect so that there would 37 9 be a net public benefit as a result of the investment. 37 10 4. COMPETITION PRESERVED. a. The subsequent liquidation 37 11 of a bank or savings bank whose shares are acquired under this 37 12 section shall not prevent the subsequent incorporation of 37 13 another bank or savings bank in the same community. 37 14 b. The superintendent of banking shall not find the 37 15 liquidation of a bank whose shares are acquired under this 37 16 section to be grounds for disapproving the incorporation of 37 17 another bank in the same community under section 524.305. 37 18 c. The superintendent of savings and loan associations 37 19 shall not find the liquidation of a savings and loan 37 20 association whose shares are acquired under this section to be 37 21 grounds for disapproving the incorporation of another savings 37 22 and loan association in the same community under chapter 534. 37 23 Sec. 36. NEW SECTION. 533.306 POWER TO BORROW. 37 24 A state credit union may borrow from any source in total a 37 25 sum that shall not exceed fifty percent of the sum of its 37 26 share and deposit account balances. 37 27 Sec. 37. NEW SECTION. 533.307 ACCOUNT INSURANCE. 37 28 1. Except as provided in section 533.302, a state credit 37 29 union organized under this chapter, as a condition of 37 30 maintaining its privilege of organization, shall acquire and 37 31 maintain insurance to protect each holder of an ownership 37 32 share and each depositor against loss of funds held on account 37 33 by the credit union. 37 34 2. The insurance required by this section shall be 37 35 obtained from an agency of the federal government or a deposit 38 1 insurance plan approved by the Iowa commissioner of insurance 38 2 and the superintendent. 38 3 Sec. 38. NEW SECTION. 533.308 FIDELITY BOND AND GENERAL 38 4 INSURANCE COVERAGE. 38 5 1. A state credit union shall maintain a fidelity bond for 38 6 credit union employees and officials in a sufficient amount to 38 7 indemnify the credit union against losses that may be incurred 38 8 by reason of any act or acts of fraud, dishonesty, forgery, 38 9 theft, larceny, embezzlement, wrongful abstraction, 38 10 misapplication, misappropriation, or other unlawful act 38 11 committed by the employee or official directly or through 38 12 connivance with others, and general insurance coverage for 38 13 losses caused by persons not associated with the credit union. 38 14 a. The fidelity bond and general insurance coverage shall 38 15 be obtained from a company authorized to do business in this 38 16 state. 38 17 b. The superintendent may require additional coverage for 38 18 any state credit union if, in the opinion of the 38 19 superintendent, current coverage is insufficient. The board 38 20 of directors of the credit union shall obtain the additional 38 21 coverage within thirty days after written notice from the 38 22 superintendent. 38 23 2. The superintendent may furnish to any official of an 38 24 insurance plan by which the accounts of a state credit union 38 25 are insured or by which its employees and officials are 38 26 bonded, any information relating to examinations, 38 27 investigations, and reports of the status of that credit union 38 28 or its employees and officials for the purpose of facilitating 38 29 the availability or continuation of the insurance or bond of 38 30 the credit union or resolution of a claim. 38 31 Sec. 39. NEW SECTION. 533.309 SHARE ACCOUNTS. 38 32 A state credit union may have share accounts including, but 38 33 not limited to, the following types: 38 34 1. OWNERSHIP SHARE ACCOUNT. The ownership share account 38 35 shall consist of an account balance held by the credit union 39 1 in accordance with the credit union's bylaws and maintained at 39 2 a par value amount set by the credit union. Each member may 39 3 acquire only one ownership share. In the case of a joint 39 4 account, each joint account owner who has applied for and has 39 5 been accepted as a member must maintain an ownership share 39 6 account. The credit union shall not set off fees against a 39 7 member's ownership share. 39 8 2. JOINT ACCOUNTS. A member may designate any person or 39 9 persons to hold shares, deposits, and thrift club accounts 39 10 with the member in joint tenancy with the right of 39 11 survivorship, but such a joint tenant, unless a member in the 39 12 person's own right, shall not be permitted to vote, obtain 39 13 loans, or hold office or be required to pay an entrance fee. 39 14 Payment of part or all of such joint accounts to any of the 39 15 joint tenants shall, to the extent of such payment, discharge 39 16 the liability to all. 39 17 3. ACCOUNT FOR MINORS. Shares may be issued and deposits 39 18 accepted in the name of a minor. Such shares and deposits may 39 19 be withdrawn by the minor and payments made on such 39 20 withdrawals shall be valid. A minor under sixteen years of 39 21 age shall not be entitled to vote in the meetings of the 39 22 members either personally or through the minor's parent or 39 23 guardian, and a minor shall not become a director until the 39 24 minor reaches the minor's eighteenth birthday. 39 25 4. TRUST ACCOUNTS. If shares and deposits are held in 39 26 trust, the name and residence address of the beneficiary shall 39 27 be disclosed and the account shall be kept in the name of the 39 28 holder as trustee for the beneficiary. The shares and 39 29 deposits may be withdrawn, upon the death of the trustee, by 39 30 the beneficiary's legal representative. 39 31 Sec. 40. NEW SECTION. 533.310 DEPOSITS IN THE NAMES OF 39 32 TWO OR MORE INDIVIDUALS. 39 33 When a deposit is made in a state credit union in the names 39 34 of two or more individuals that is payable to any one or more 39 35 of them or is payable to the survivor or survivors, the 40 1 deposit, including interest, or any part, may be paid to any 40 2 one or more of the individuals, whether or not the others are 40 3 living. The receipt or a quittance of the individuals who are 40 4 paid is a valid and sufficient release and discharge of the 40 5 credit union for any payment made pursuant to this section. 40 6 Sec. 41. NEW SECTION. 533.311 ACCEPTANCE OF DEPOSITS AND 40 7 INVESTMENTS WHILE INSOLVENT. 40 8 When a state credit union is insolvent, the credit union 40 9 shall not do either of the following: 40 10 1. Accept any deposits or investments in ownership shares. 40 11 2. Renew or extend the term of any time deposits or time 40 12 investments. 40 13 Sec. 42. NEW SECTION. 533.312 DIVIDENDS. 40 14 1. The board of directors may declare dividends at such 40 15 rates and upon such classes of shares as are determined by the 40 16 board, at such intervals and for such periods as the board may 40 17 authorize, and after provision for required reserves pursuant 40 18 to section 533.303. 40 19 2. Dividends shall be considered a normal operating 40 20 expense of the state credit union and shall be paid on all 40 21 paid-up shares outstanding at the close of the period for 40 22 which the dividend is declared and shall be available only 40 23 from undivided earnings. 40 24 Sec. 43. NEW SECTION. 533.313 SHARE DRAFTS. 40 25 1. A state credit union may provide its members with share 40 26 draft accounts. 40 27 a. "Share draft" means a negotiable draft which is payable 40 28 upon demand and is used to withdraw funds from a share draft 40 29 account. 40 30 b. A share draft is an item for purposes of chapter 554, 40 31 article 4. 40 32 c. The term does not include a draft issued by a state 40 33 credit union for the transfer of funds between the issuing 40 34 credit union and another credit union, a bank, a savings and 40 35 loan association, or another depository financial institution. 41 1 2. A share draft account is an account that is a demand 41 2 account from which a state credit union has agreed that funds 41 3 may be withdrawn by means of a share draft. A share draft 41 4 account may bear interest or dividends as determined by the 41 5 board of directors, provided that the credit union shall not 41 6 pay interest or dividends on a share draft account at a rate 41 7 that exceeds the maximum interest rate which a regulated 41 8 financial institution is able to pay on comparable instruments 41 9 as allowed by the depository institutions deregulatory 41 10 committee. 41 11 3. A state credit union may guarantee payment for a share 41 12 draft if both the following conditions are met: 41 13 a. A specific guarantee authorization is obtained for the 41 14 share draft from the credit union. 41 15 b. The guarantee authorization is immediately noted on the 41 16 share draft account to prevent the withdrawal of funds needed 41 17 to pay the guaranteed share draft. 41 18 4. A state credit union may charge fees and penalties on 41 19 share drafts and apply fees and penalties to the credit 41 20 union's income in relation to share draft services. 41 21 5. The superintendent may adopt rules relating to share 41 22 draft programs as necessary to administer this chapter. 41 23 Sec. 44. NEW SECTION. 533.314 PAYMENT OF SHARE DRAFTS 41 24 DURING DISSOLUTION. 41 25 Other provisions of section 533.404 notwithstanding, when a 41 26 state credit union is dissolved, first priority of payment 41 27 shall be given to unpaid share drafts. However, a share draft 41 28 shall not be paid if any of the following conditions exist: 41 29 1. The share draft was issued on or after the date of 41 30 dissolution, or on or after the date the state credit union is 41 31 required by section 533.405, subsection 2, to cease doing 41 32 business in the event of a voluntary dissolution. 41 33 2. The share draft is written against an account that does 41 34 not contain sufficient funds with which to pay the share 41 35 draft. 42 1 3. The share draft is payable to a member of the state 42 2 credit union, or to a member of the family of the issuer of 42 3 the share draft, or to a business in which the issuer of the 42 4 share draft has an interest. However, the exception contained 42 5 in this subsection does not apply to any person referred to in 42 6 this subsection if the person is a holder in due course, as 42 7 provided in chapter 554, article 3. 42 8 Sec. 45. NEW SECTION. 533.315 LOANS. 42 9 1. A state credit union may loan to a member for a 42 10 provident or productive purpose. 42 11 a. Loans are subject to the conditions contained in this 42 12 section and in the bylaws. 42 13 b. A loan may be repaid by the borrower, in whole or in 42 14 part, any day the office of the credit union is open for 42 15 business. 42 16 c. A loan shall be pursuant to an application with 42 17 supportive credit information. 42 18 d. The superintendent may adopt rules requiring periodic 42 19 updating of credit or financial information for all loans or 42 20 for classes of loans designated in the rules. 42 21 2. A state credit union shall not lend in the aggregate to 42 22 a member more than ten percent of its member savings. 42 23 3. A director of a state credit union may borrow from that 42 24 credit union under the provisions of this chapter, but the 42 25 rates, terms, and conditions of a loan or line of credit 42 26 either made to or endorsed or guaranteed by the director shall 42 27 not be more favorable than the rates, terms, or conditions of 42 28 comparable loans or lines of credit provided to other members. 42 29 The aggregate amount of all director loans and lines of credit 42 30 shall not exceed twenty-five percent of the assets of the 42 31 credit union. 42 32 4. a. A state credit union may make permanent loans, 42 33 construction loans, or combined construction and permanent 42 34 loans, secured by liens on real property, as authorized by 42 35 rules adopted by the superintendent under chapter 17A. These 43 1 rules shall contain provisions as necessary to ensure the 43 2 safety and soundness of these loans, and to ensure full and 43 3 fair disclosure to borrowers of the effects of provisions in 43 4 agreements for these loans, including provisions permitting 43 5 change or adjustment of any terms of a loan, provisions 43 6 permitting, requiring, or prohibiting repayment of a loan on a 43 7 basis other than of equal periodic installments of interest 43 8 plus principal over a fixed term, provisions imposing 43 9 penalties for the borrower's noncompliance with requirements 43 10 of a loan agreement, or provisions allowing or requiring a 43 11 borrower to choose from alternative courses of action at any 43 12 time during the effectiveness of a loan agreement. 43 13 b. (1) A state credit union may include in the loan 43 14 documents signed by the borrower a provision requiring the 43 15 borrower to pay the credit union each month in addition to 43 16 interest and principal under the note an amount equal to one- 43 17 twelfth of the estimated annual real estate taxes, special 43 18 assessments, hazard insurance premium, mortgage insurance 43 19 premium, or any other payment agreed to by the borrower and 43 20 the credit union in order to better secure the loan. The 43 21 credit union shall be deemed to be acting in a fiduciary 43 22 capacity with respect to these funds. 43 23 (2) A state credit union receiving funds in escrow 43 24 pursuant to an escrow agreement executed on or after July 1, 43 25 1982, in connection with a loan as defined in section 535.8, 43 26 subsection 1, shall pay interest to the borrower on those 43 27 funds, calculated on a daily basis, at the rate the credit 43 28 union pays to its members on ordinary savings deposits. 43 29 (3) A state credit union that maintains an escrow account 43 30 in connection with any loan authorized by this subsection, 43 31 whether or not the mortgage has been assigned to a third 43 32 person, shall each year deliver to the mortgagor a written 43 33 annual accounting of all transactions made with respect to the 43 34 loan and escrow account. 43 35 c. A state credit union that obtains a report or opinion 44 1 by an attorney or from another mortgage lender relating to 44 2 defects in or liens or encumbrances on the title to real 44 3 property, the unmarketability of the title to real property, 44 4 or the invalidity or unenforceability of liens or encumbrances 44 5 on real property, shall provide a copy of the report or 44 6 opinion to the mortgagor and the mortgagor's attorney. 44 7 5. a. A state credit union may act as an escrow agent 44 8 with respect to real property that is mortgaged to the credit 44 9 union, and may receive funds and make disbursements from 44 10 escrowed funds in that capacity. 44 11 b. The state credit union shall be deemed to be acting in 44 12 a fiduciary capacity with respect to escrowed funds. 44 13 c. A state credit union that maintains an escrow account, 44 14 whether or not a mortgage has been assigned to a third person, 44 15 shall deliver to the mortgagor a written summary of all 44 16 transactions made with respect to the loan and escrow accounts 44 17 during each calendar year. However, the mortgagor and 44 18 mortgagee may, by mutual agreement, select a fiscal year 44 19 reporting period other than the calendar year. 44 20 The summary shall be delivered or mailed not later than 44 21 thirty days following the year to which the disclosure 44 22 relates. The summary shall contain all of the following 44 23 information: 44 24 (1) The name and address of the mortgagee. 44 25 (2) The name and address of the mortgagor. 44 26 (3) A summary of escrow account activity during the year 44 27 as follows: 44 28 (a) The balance of the escrow account at the beginning of 44 29 the year. 44 30 (b) The aggregate amount of deposits to the escrow account 44 31 during the year. 44 32 (c) The aggregate amount of withdrawals from the escrow 44 33 account for each of the following categories: 44 34 (i) Payments against loan principal. 44 35 (ii) Payments against interest. 45 1 (iii) Payments against real estate taxes. 45 2 (iv) Payments for real property insurance premiums. 45 3 (v) All other withdrawals. 45 4 (d) The balance of the escrow account at the end of the 45 5 year. 45 6 d. A summary of loan principal for the year as follows: 45 7 (1) The amount of principal outstanding at the beginning 45 8 of the year. 45 9 (2) The aggregate amount of payments against principal 45 10 during the year. 45 11 (3) The amount of principal outstanding at the end of the 45 12 year. 45 13 6. Loans that are not secured by real property shall be 45 14 subject to the following conditions: 45 15 a. Loans to any one member that in the aggregate exceed 45 16 the unsecured loan limit established by the board of directors 45 17 of a state credit union shall be secured by one or more 45 18 cosigners or guarantors, or by a first lien on collateral 45 19 having a value that is approximately equal to the amount in 45 20 excess of such unsecured loan limit. Every cosigner or 45 21 guarantor shall furnish the credit union with evidence of 45 22 financial responsibility. 45 23 b. This subsection shall not be deemed to preclude a 45 24 credit committee or loan officer from requiring security for 45 25 any loan. 45 26 c. A state credit union may make loans according to any or 45 27 all of the following: 45 28 (1) Loans insured under the provisions of 20 U.S.C. } 45 29 1071-1087 or similar state programs. 45 30 (2) Loans insured by the federal housing administration 45 31 under 12 U.S.C. } 1703. 45 32 (3) Loans to families of low or moderate income as a part 45 33 of programs authorized in sections 16.1 to 16.36. 45 34 d. The restrictions and limitations contained in this 45 35 subsection do not apply to loans made to a member credit union 46 1 by a corporate central credit union. 46 2 7. This section shall not prevent the renewal or extension 46 3 of loans. 46 4 8. The superintendent may impose a penalty on a state 46 5 credit union for each loan made in violation of this section. 46 6 If a credit union, after notice in writing, and opportunity 46 7 for hearing, fails to satisfactorily resolve the matter within 46 8 sixty days from receipt of such notice, the superintendent may 46 9 impose a penalty against such credit union in an amount not to 46 10 exceed one hundred dollars per day per violation for each day 46 11 the violation remains unresolved. 46 12 9. The provisions of the Iowa consumer credit code shall 46 13 apply to consumer loans made by a credit union, and a 46 14 provision of that code shall supersede any conflicting 46 15 provision of this chapter with respect to a consumer loan. 46 16 10. If a member elects to repay a loan secured by a 46 17 mortgage or deed of trust upon real property that is a single- 46 18 family or a two-family dwelling or agricultural land at a date 46 19 earlier than is required by the terms of the loan, the state 46 20 credit union shall be governed by section 535.9. 46 21 11. Real estate loans on one-family to four-family 46 22 dwellings may be repaid in part or in full at any time, except 46 23 that a state credit union may charge not to exceed six months' 46 24 advance interest on that part of the aggregate amount of all 46 25 prepayments made on such loan in any twelve-month period which 46 26 exceeds twenty percent of the original principal amount of the 46 27 loan; and may charge any negotiated rate on other loans. This 46 28 subsection, however, does not authorize a state credit union 46 29 to charge any advance interest or prepayment penalty where 46 30 prohibited by section 535.9. 46 31 Sec. 46. NEW SECTION. 533.316 INTEREST RATES. 46 32 1. a. Interest rates on loans made by a state credit 46 33 union, other than loans secured by a mortgage or deed of trust 46 34 which is a first lien upon real property, shall not exceed the 46 35 finance charge permitted in sections 537.2401 and 537.2402 on 47 1 consumer loans. 47 2 b. Interest rates on business loans shall not exceed the 47 3 finance charge permitted by section 535.2. 47 4 2. With respect to a loan secured by a mortgage or deed of 47 5 trust which is a first lien upon real property, a state credit 47 6 union shall not charge a rate of interest that exceeds the 47 7 maximum rate permitted by section 535.2. 47 8 3. The provisions of this section do not apply to a loan 47 9 that is subject to section 636.46. 47 10 Sec. 47. NEW SECTION. 533.317 AUTHORITY TO LEASE SAFE 47 11 DEPOSIT BOXES. 47 12 1. A state credit union may lease safe deposit boxes for 47 13 the storage of property on terms and conditions prescribed by 47 14 the credit union. The terms and conditions shall not bind any 47 15 person to whom the credit union does not give notice of the 47 16 terms and conditions by delivery of a lease and agreement in 47 17 writing containing the terms and conditions. 47 18 2. A state credit union may limit its liability provided 47 19 that the limitations are set forth in the lease and agreement 47 20 in at least the same size and type as the other substantive 47 21 provisions of the contract. 47 22 3. The lease and agreement of a safe deposit box may 47 23 provide that evidence tending to prove that property was left 47 24 in a safe deposit box upon the last entry by the member or the 47 25 member's authorized agent, and that the property or any part 47 26 of the property was found missing upon subsequent entry, is 47 27 not sufficient to raise a presumption that the property was 47 28 lost by any negligence or wrongdoing for which the state 47 29 credit union is responsible, or put upon the credit union the 47 30 burden of proof that the alleged loss was not the fault of the 47 31 credit union. 47 32 4. A state credit union may lease a safe deposit box to a 47 33 minor. 47 34 a. A state credit union may deal with a minor with respect 47 35 to a safe deposit lease and agreement without the consent of a 48 1 parent, guardian, or conservator and with the same effect as 48 2 though the minor were an adult. 48 3 b. Any action of the minor with respect to such safe 48 4 deposit lease and agreement is binding on the minor with the 48 5 same effect as though the minor were an adult. 48 6 5. A state credit union that has on file a power of 48 7 attorney of a member covering a safe deposit lease and 48 8 agreement, which has not been revoked by the member, shall 48 9 incur no liability as a result of continuing to honor the 48 10 provisions of the power of attorney in the event of the death 48 11 or incompetence of the donor of the power of attorney until 48 12 the credit union receives written notice of the death, or 48 13 written notice of adjudication by a court of the incompetence 48 14 of the member and the appointment of a guardian or 48 15 conservator. 48 16 Sec. 48. NEW SECTION. 533.318 SAFE DEPOSIT BOX ACCESS. 48 17 1. A state credit union shall permit a person named in and 48 18 authorized by a court order to open, examine, and remove the 48 19 contents of a safe deposit box located at the credit union. 48 20 2. If a court order has not been delivered to a state 48 21 credit union, the following persons may access and remove any 48 22 or all contents of a safe deposit box located at the credit 48 23 union and described in an ownership or rental agreement or 48 24 lease between the credit union and a deceased owner or lessee: 48 25 a. A co-owner or co-lessee of the safe deposit box. 48 26 b. A person designated in the safe deposit box agreement 48 27 or lease to have access to the safe deposit box upon the death 48 28 of the lessee, to the extent provided in the safe deposit box 48 29 agreement or lease. 48 30 c. An executor or administrator of the estate of a 48 31 deceased owner or lessee upon delivery to the credit union of 48 32 a certified copy of letters of appointment. 48 33 d. A person named as an executor in a copy of a purported 48 34 will produced by the person, provided such access shall be 48 35 limited to the removal of a purported will, and no other 49 1 contents shall be removed. 49 2 e. A trustee of a trust created by the deceased owner or 49 3 lessee upon delivery to the credit union of a copy of the 49 4 trust together with an affidavit by the trustee that certifies 49 5 that the copy of the trust delivered to the credit union with 49 6 the affidavit is an accurate and complete copy of the trust, 49 7 the trustee is the duly authorized and acting trustee under 49 8 the trust, the trust property includes property in the safe 49 9 deposit box, and that to the knowledge of the trustee the 49 10 trust has not been revoked. 49 11 3. A person removing any contents of a safe deposit box 49 12 pursuant to subsection 1 shall deliver any writing purported 49 13 to be a will of the decedent to the court having jurisdiction 49 14 over the decedent's estate. 49 15 4. a. If a person authorized to have access under 49 16 subsection 1 does not request access to the safe deposit box 49 17 within the thirty-day period immediately following the date of 49 18 death of the owner or lessee of a safe deposit box, and the 49 19 state credit union has knowledge of the death of the owner or 49 20 lessee of the safe deposit box, the safe deposit box may be 49 21 opened by or in the presence of two employees of the credit 49 22 union. 49 23 b. If a safe deposit box is opened pursuant to paragraph 49 24 "a", the state credit union employees present at such opening 49 25 shall do all of the following: 49 26 (1) Remove any purported will of the deceased owner or 49 27 lessee. 49 28 (2) Unseal, copy, and retain in the records of the credit 49 29 union a copy of a purported will removed from the safe deposit 49 30 box. An additional copy of such purported will shall be made, 49 31 dated, and signed by the credit union employees present at the 49 32 safe deposit box opening and placed in the safe deposit box. 49 33 The safe deposit box shall then be resealed. 49 34 (3) The original of a purported will shall be sent by 49 35 certified mail or restricted certified mail or personally 50 1 delivered to the district court in the county of the last 50 2 known residence of the deceased owner or lessee, or the court 50 3 having jurisdiction over the testator's estate. If the 50 4 residence is unknown or last known and not in this state, the 50 5 purported will shall be sent by certified mail or restricted 50 6 certified mail or personally delivered to the district court 50 7 in the county where the safe deposit box is located. 50 8 c. If no key is produced, the credit union may cause the 50 9 safe deposit box to be opened and the credit union shall have 50 10 a claim against the estate of the deceased owner or lessee and 50 11 a lien upon the contents of the safe deposit box for the costs 50 12 of opening and resealing the safe deposit box. 50 13 4. a. A state credit union may rely upon published 50 14 information or other reasonable proof of death of an owner or 50 15 lessee. 50 16 b. A credit union has no duty to inquire about or 50 17 discover, and is not liable to any person for failure to 50 18 inquire about or discover, the death of the owner or lessee of 50 19 a safe deposit box. 50 20 c. A credit union has no duty to open or cause to be 50 21 opened, and is not liable to any person for failure to open or 50 22 cause to be opened, a safe deposit box of a deceased owner or 50 23 lessee. 50 24 d. Upon compliance with the requirements of subsection 1 50 25 or 2, the credit union is not liable to any person as a result 50 26 of the opening of the safe deposit box, removal and delivery 50 27 of the purported will, or retention of the unopened safe 50 28 deposit box and contents. 50 29 Sec. 49. NEW SECTION. 533.319 ADVERSE CLAIMS TO PROPERTY 50 30 IN SAFE DEPOSIT AND SAFEKEEPING. 50 31 1. A state credit union shall not be required, in the 50 32 absence of a court order or indemnity required by this 50 33 section, to recognize any claim to, or claim of authority to 50 34 exercise control over, property held in safe deposit or 50 35 property held for safekeeping pursuant to section 533.321 made 51 1 by a person or persons other than the following: 51 2 a. The member in whose name the property is held by the 51 3 state credit union. 51 4 b. An individual or group of individuals who are 51 5 authorized to have access to the safe deposit box, or to the 51 6 property held for safekeeping, pursuant to a certified 51 7 corporate resolution or other written arrangement with the 51 8 member, currently on file with the state credit union, which 51 9 has not been revoked by valid corporate action in the case of 51 10 a corporation, or by a valid agreement or other valid action 51 11 appropriate for the form of legal organization of any other 51 12 member, of which the credit union has received notice and 51 13 which is not the subject of a dispute known to the credit 51 14 union as to its original validity. The safe deposit and 51 15 safekeeping account records of a credit union shall be 51 16 presumptive evidence as to the identity of the member on whose 51 17 behalf the property is held. 51 18 2. A person making an adverse claim to, or an adverse 51 19 claim of authority to control, property held in a safe deposit 51 20 box or for safekeeping, must do either of the following: 51 21 a. Obtain and serve on the state credit union an 51 22 appropriate court order or judicial process directed to the 51 23 credit union, restraining any action with respect to the 51 24 property until further order of the court or instructing the 51 25 credit union to deliver the property, in whole or in part, as 51 26 indicated in the order or process. 51 27 b. Deliver to the state credit union a bond, in form and 51 28 amount with sureties satisfactory to the credit union, 51 29 indemnifying the credit union against any liability, loss, or 51 30 expense which the credit union might incur because of its 51 31 refusal to deliver the property to any person described in 51 32 subsection 1, paragraph "a" or "b". 51 33 Sec. 50. NEW SECTION. 533.320 REMEDIES AND PROCEEDINGS 51 34 FOR NONPAYMENT OF RENT ON SAFE DEPOSIT BOX. 51 35 1. A state credit union has a lien upon the contents of a 52 1 safe deposit box for past due rentals and any expense incurred 52 2 in opening the safe deposit box, replacement of the locks on 52 3 the safe deposit box, and of a sale made pursuant to this 52 4 section. 52 5 2. If the rental of a safe deposit box is not paid within 52 6 six months from the day the rental is due, at any time after 52 7 the six months and while the rental remains unpaid, the state 52 8 credit union shall mail a notice by restricted certified mail 52 9 to the member at the member's last known address as shown upon 52 10 the records of the credit union, stating that if the amount 52 11 due for the rental is not paid on or before a specified day, 52 12 which shall be at least thirty days after the date of mailing 52 13 such notice, the credit union will remove the contents of the 52 14 safe deposit box and hold the contents for the account of the 52 15 member. 52 16 3. If the rental for the safe deposit box has not been 52 17 paid after the expiration of the period specified in a notice 52 18 mailed pursuant to subsection 2, the state credit union, in 52 19 the presence of two of its officers, may cause the box to be 52 20 opened and the contents removed. An inventory of the contents 52 21 of the safe deposit box shall be made by the two officers 52 22 present and the contents held by the credit union for the 52 23 account of the member. 52 24 4. a. If the contents are not claimed within two years 52 25 after their removal from the safe deposit box, the state 52 26 credit union may proceed to sell so much of the contents as is 52 27 necessary to pay the past due rentals and expense incurred in 52 28 opening the safe deposit box, replacement of the locks on the 52 29 safe deposit box, and the sale of the contents. 52 30 b. The sale shall be held at the time and place specified 52 31 in a notice published prior to the sale once each week for two 52 32 successive weeks in a newspaper of general circulation 52 33 published in the city or unincorporated area in which the 52 34 state credit union has its principal place of business, or if 52 35 there is none, a newspaper of general circulation published in 53 1 the county, or in a county adjoining the county, in which the 53 2 credit union has its principal place of business. 53 3 c. A copy of the published notice shall be mailed to the 53 4 member at the member's last known address as shown upon the 53 5 records of the state credit union. 53 6 d. The notice shall contain the name of the member and 53 7 need only describe the contents of the safe deposit box in 53 8 general terms. 53 9 e. The contents of any number of safe deposit boxes may be 53 10 sold under one notice of sale and the cost of the sale 53 11 apportioned ratably among the several safe deposit box members 53 12 involved. 53 13 f. At the time and place designated in the notice the 53 14 contents taken from each respective safe deposit box shall be 53 15 sold separately to the highest bidder for cash and the 53 16 proceeds of each sale applied to the rentals and expenses due 53 17 to the credit union and the residue from any such sale shall 53 18 be held by the state credit union for the account of the 53 19 member or members. 53 20 g. An amount held as proceeds from such sale shall be 53 21 credited with interest at the customary annual rate for 53 22 savings accounts at the state credit union, or in lieu, at the 53 23 customary rate of interest in the community where such 53 24 proceeds are held. The crediting of interest does not 53 25 activate the account to avoid an abandonment as unclaimed 53 26 property under chapter 556. 53 27 5. a. Notwithstanding the provisions of this section, 53 28 shares, bonds, or other securities which, at the time of a 53 29 sale pursuant to subsection 3, are listed on an established 53 30 stock exchange in the United States shall not be sold at 53 31 public sale but may be sold through an established stock 53 32 exchange. 53 33 b. Upon making a sale of any such securities, an officer 53 34 of the state credit union shall execute and attach to the 53 35 securities an affidavit reciting facts showing that the 54 1 securities were sold pursuant to this section, and that the 54 2 credit union has complied with the provisions of this section. 54 3 The affidavit constitutes sufficient authority to any 54 4 corporation whose shares are sold or to any registrar or 54 5 transfer agent of such corporation to cancel the certificates 54 6 representing the shares to the purchaser of the shares, and to 54 7 any registrar, trustee, or transfer agent of registered bonds 54 8 or other securities, to register any such bonds or other 54 9 securities in the name of the purchaser of the bonds or other 54 10 securities. 54 11 5. The proceeds of any sale made pursuant to this section, 54 12 after the payment of any amounts with respect to which the 54 13 state credit union has a lien, any property that was not 54 14 offered for sale and property which, although offered for 54 15 sale, was not sold, shall be retained by the credit union 54 16 until such time as the property is presumed abandoned 54 17 according to section 556.2, and shall be handled pursuant to 54 18 chapter 556. 54 19 Sec. 51. NEW SECTION. 533.321 AUTHORITY TO RECEIVE 54 20 PROPERTY FOR SAFEKEEPING. 54 21 1. A state credit union may accept property for 54 22 safekeeping if the credit union issues a receipt for the 54 23 property, except in the case of night depositories. 54 24 a. A credit union accepting property for safekeeping shall 54 25 purchase and maintain reasonable insurance coverage to ensure 54 26 against loss incurred in connection with the acceptance of 54 27 property for safekeeping. 54 28 b. Property held for safekeeping shall not be commingled 54 29 with the property of the credit union or the property of 54 30 others. 54 31 2. A state credit union has a lien upon any property held 54 32 for safekeeping and for expenses incurred in any sale made 54 33 pursuant to this subsection. 54 34 a. If the charge for safekeeping of property is not paid 54 35 within six months from the day the charge is due, at any time 55 1 after the six months and while the charge remains unpaid, the 55 2 credit union may mail a notice to the member at the member's 55 3 last known address as shown upon the records of the credit 55 4 union, stating that if the amount due is not paid on or before 55 5 a specified day, which shall be at least thirty days after the 55 6 date of mailing the notice, the credit union will remove the 55 7 property from safekeeping and hold the property for the 55 8 account of the member. 55 9 b. After the expiration of the period specified in the 55 10 notice, if the charge for safekeeping has not been paid, the 55 11 credit union may remove the property from safekeeping, cause 55 12 the property to be inventoried, and hold the property for the 55 13 account of the member. 55 14 c. If the property is not claimed within two years after 55 15 its removal from safekeeping, the credit union may proceed to 55 16 sell so much of the property as is necessary to pay the charge 55 17 which remains unpaid and the expense incurred in making the 55 18 sale in the manner provided for in section 533.320, 55 19 subsections 4 and 5. 55 20 d. The proceeds of any sale made pursuant to this section, 55 21 after payment of any amounts with respect to which the credit 55 22 union has a lien, any property that was not offered for sale, 55 23 and property which, although offered for sale, was not sold, 55 24 shall be retained by the credit union until such time as the 55 25 property is presumed abandoned according to section 556.2, and 55 26 shall be handled pursuant to chapter 556. 55 27 Sec. 52. NEW SECTION. 533.322 PRESERVATION OF RECORDS. 55 28 1. A state credit union is not required to preserve its 55 29 records for a period longer than eleven years after the first 55 30 day of January of the year following the time of the making or 55 31 filing of such records. However, account records showing 55 32 unpaid balances due to depositors shall not be destroyed. 55 33 2. A copy of an original may be kept in lieu of any 55 34 original records. 55 35 a. For purposes of this section, a copy includes any 56 1 duplicate, rerecording or reproduction of an original record 56 2 from any photograph, photostat, microfilm, microcard, 56 3 miniature or microphotograph, computer printout, 56 4 electronically stored data or image, or other process that 56 5 accurately reproduces or forms a durable medium for accurately 56 6 and legibly reproducing an unaltered image or reproduction of 56 7 the original record. 56 8 b. A copy is deemed to be an original and shall be treated 56 9 as an original record in a judicial or administrative 56 10 proceeding for purposes of admissibility in evidence. A 56 11 facsimile, exemplification, or certified copy of any such copy 56 12 reproduced from a film record is deemed to be a facsimile, 56 13 exemplification, or certified copy of the original. 56 14 Sec. 53. NEW SECTION. 533.323 PHOTOGRAPHIC RECORDS. 56 15 1. Any state credit union writing or record, or a 56 16 photostatic or photographic reproduction of such writing or 56 17 record, whether in the form of an entry in a book or 56 18 otherwise, made as a memorandum or record of any act, 56 19 transaction, occurrence, or event, shall be admissible in 56 20 evidence as proof of the act, transaction, occurrence, or 56 21 event, if made in the regular course of business. 56 22 2. A printout or other tangible output, readable by sight, 56 23 shown to accurately reflect data contained in a promissory 56 24 note, negotiable instrument, or letter of credit, that 56 25 contains a signature made or created by electronic or digital 56 26 means such that it is stored by a computer or similar device, 56 27 is deemed to be an original of such note, instrument, or 56 28 letter for purposes of presenting such note, instrument, or 56 29 letter for payment, acceptance, or honor, or for purposes of a 56 30 judicial proceeding involving a claim based upon such note, 56 31 instrument, or letter. 56 32 Sec. 54. NEW SECTION. 533.324 LIABILITY FOR DESTRUCTION. 56 33 1. Liability shall not accrue against a state credit union 56 34 for destroying records if the records were maintained for the 56 35 minimum time provided for in this chapter. 57 1 2. In any cause or proceeding in which state credit union 57 2 records or files may be called in question or be demanded of 57 3 the credit union, or any officer or employee, a showing that 57 4 such records or files have been destroyed in accordance with 57 5 the provisions of this chapter or rules adopted pursuant to 57 6 this chapter shall be a sufficient excuse for the failure to 57 7 produce them. 57 8 Sec. 55. NEW SECTION. 533.325 CONFIDENTIALITY OF CREDIT 57 9 UNION INFORMATION. 57 10 1. The directors, officers, committee members and 57 11 employees of a state credit union shall hold in confidence all 57 12 information regarding transactions of the credit union, 57 13 including information regarding transactions with its members 57 14 and their personal affairs, except to the extent necessary in 57 15 connection with making, extending, or collecting a loan or 57 16 line of credit, guaranteeing of member share drafts by third 57 17 parties, or complying with the examination of credit union 57 18 records by regulatory authorities or compliance with an order 57 19 from a court having jurisdiction over the credit union. 57 20 2. The board of directors may authorize participation of a 57 21 state credit union in a credit or consumer reporting agency if 57 22 the board has determined that use of such an agency is 57 23 essential in making and extending a loan or line of credit, or 57 24 guaranteeing member share drafts, and that information 57 25 supplied by the credit union to such agency will be made 57 26 available only to legitimate members of that agency having a 57 27 legitimate business need for the information in connection 57 28 with a business transaction involving a credit union. 57 29 Sec. 56. NEW SECTION. 533.326 GOVERNMENTAL EMPLOYEES. 57 30 1. When a state credit union has been organized by the 57 31 employees of the state or any political subdivision of the 57 32 state, the officer who writes warrants for the state or other 57 33 governmental body by which any public employee credit union 57 34 member is employed, may withhold from the salary or wages of 57 35 the employee, and pay over to such credit union, sums as may 58 1 be designated by written authorization signed by the employee. 58 2 2. The provisions of section 539.4 shall have no 58 3 application to this section. 58 4 Sec. 57. NEW SECTION. 533.327 CHANGE IN PLACE OF 58 5 BUSINESS. 58 6 A state credit union may change its place of business on 58 7 written notice to the superintendent. 58 8 Sec. 58. NEW SECTION. 533.328 CONDUCTING BUSINESS 58 9 OUTSIDE OF STATE. 58 10 If another state's credit union law or regulation allows 58 11 credit unions operating in that state to exercise additional 58 12 power not permitted in this state, an Iowa credit union 58 13 conducting business outside this state may request permission 58 14 from the Iowa superintendent to exercise the additional power 58 15 while operating in the state where the additional power is 58 16 allowed. 58 17 Sec. 59. NEW SECTION. 533.329 TAXATION. 58 18 1. A state credit union shall be deemed an institution for 58 19 savings and is subject to taxation only as to its real estate 58 20 and moneys and credits. The shares shall not be taxed. 58 21 2. a. The moneys and credits tax on credit unions is 58 22 imposed at a rate of five mills on each dollar of the legal 58 23 and special reserves that are required to be maintained by the 58 24 credit union under section 533.303, and shall be levied by the 58 25 board of supervisors and placed upon the tax list and 58 26 collected by the county treasurer. However, an exemption 58 27 shall be given to each credit union in the amount of forty 58 28 thousand dollars. 58 29 b. The amount collected in each taxing district within a 58 30 city shall be apportioned twenty percent to the county, thirty 58 31 percent to the city general fund, and fifty percent to the 58 32 general fund of the state, and the amount collected in each 58 33 taxing district outside of cities shall be apportioned fifty 58 34 percent to the county and fifty percent to the general fund of 58 35 the state. 59 1 c. The moneys and credits tax shall be collected at the 59 2 location of the credit union as shown in its articles of 59 3 incorporation. 59 4 d. The moneys and credits tax imposed under this section 59 5 shall be reduced by an investment tax credit authorized 59 6 pursuant to section 15E.43. 59 7 e. The moneys and credits tax imposed under this section 59 8 shall be reduced by an investment tax credit authorized 59 9 pursuant to section 15E.51. 59 10 Sec. 60. NEW SECTION. 533.330 REPORTS. 59 11 1. A state credit union shall report annually at a 59 12 specified time to the superintendent in a format prescribed by 59 13 the superintendent for that purpose. 59 14 a. If any annual report is in arrears for more than five 59 15 days, a penalty of one hundred dollars for each day such 59 16 report is in arrears may be levied by the superintendent 59 17 against the offending credit union in addition to the penalty 59 18 for failure to pay the annual fee. 59 19 b. If an annual report is not provided to the 59 20 superintendent within thirty days of the due date, the 59 21 superintendent may, after written notice to the board of 59 22 directors of the credit union, suspend or revoke the 59 23 certificate of approval, take possession of the business and 59 24 property of the credit union, and order its dissolution. 59 25 2. In addition to the annual report, the superintendent 59 26 may, from time to time, require a state credit union to 59 27 provide other supplemental reports at a specified time. 59 28 Failure of the credit union to provide supplemental reports 59 29 when due may result in the superintendent levying a penalty of 59 30 fifty dollars per day for each day such report is late. 59 31 Sec. 61. NEW SECTION. 533.401 MERGER. 59 32 1. With the approval of the superintendent, a credit union 59 33 may merge or combine with another credit union under the 59 34 existing certificate of approval of the other credit union if 59 35 the merger is pursuant to a plan agreed upon by a majority of 60 1 the board of directors of each credit union joining in the 60 2 merger and the merger is approved by the affirmative vote of a 60 3 majority of the members of the merging credit union present at 60 4 a meeting of its members called for the purpose of voting on 60 5 the merger. 60 6 2. The superintendent may approve a merger according to 60 7 the plan agreed upon by the majority of the board of directors 60 8 of each credit union if the superintendent receives a written 60 9 and verified application filed by the board of directors of 60 10 each credit union and finds all of the following: 60 11 a. Notice of the meeting called to consider the merger was 60 12 mailed to each member of the merging credit union entitled to 60 13 vote upon the question at least twenty days prior to the date 60 14 of the merger meeting. 60 15 b. The notice disclosed the purpose of the meeting and 60 16 properly informed the membership that approval of the merger 60 17 would be sought pursuant to this subsection. 60 18 c. At the meeting called to consider the merger, a 60 19 majority of the votes upon the question were in favor of the 60 20 merger. 60 21 d. Control of the merging credit union shall transfer to 60 22 the board of directors of the continuing credit union upon 60 23 approval of the merger by the superintendent and the favorable 60 24 vote of a majority of the members as prescribed in paragraph 60 25 "c". Upon transfer of control, the board of directors of the 60 26 merging credit union may only do such things necessary to 60 27 execute the merger. 60 28 3. The superintendent may waive the membership merger vote 60 29 if the superintendent finds that an emergency exists which 60 30 justifies the waiver. 60 31 4. The certificate of merger and a copy of the agreed plan 60 32 of merger shall be forwarded to the superintendent, certified 60 33 by the superintendent, and returned to both credit unions 60 34 within thirty days of the date of receipt by the 60 35 superintendent. 61 1 5. a. Upon return of the certificate from the 61 2 superintendent, all of the merging credit union's property, 61 3 property rights, and members' interests shall vest in the 61 4 continuing credit union without the legal need for deeds, 61 5 endorsements or other instruments of transfer, and all debts, 61 6 obligations, and liabilities of the merging credit union shall 61 7 be assumed by the continuing credit union. 61 8 b. The rights and privileges of the members of the merging 61 9 credit union shall continue as provided in the plan. 61 10 c. Credit union membership in the continuing credit union 61 11 shall be available to persons within the common bond of the 61 12 merging credit union. 61 13 6. This section shall be construed to permit a credit 61 14 union organized under any other statute to merge with one 61 15 organized under this chapter, or to permit one organized under 61 16 this chapter to merge with one organized under any other 61 17 statute. 61 18 Sec. 62. NEW SECTION. 533.402 CONVERSION OF FINANCIAL 61 19 INSTITUTION TO STATE CREDIT UNION. 61 20 1. Any organized or incorporated financial institution may 61 21 convert into a state credit union by compliance with the laws 61 22 of the original supervisory authority and upon the approval of 61 23 the superintendent. 61 24 a. Application for approval of the conversion to a state 61 25 credit union shall be submitted to the superintendent in the 61 26 form prescribed by the superintendent, together with the 61 27 articles of incorporation and bylaws as required for 61 28 organization of a credit union pursuant to this chapter. 61 29 b. The superintendent may cause an examination to be made 61 30 of any converting financial institution. The converting 61 31 financial institution shall reimburse the superintendent for 61 32 the division's costs related to the conversion. 61 33 2. a. If the superintendent should approve the 61 34 application of an organized or incorporated financial 61 35 institution for conversion to a state credit union, the 62 1 superintendent shall cause the articles of incorporation of 62 2 the resulting state credit union to be filed and recorded in 62 3 the county in which the credit union has its principal place 62 4 of business and the superintendent shall issue a certificate 62 5 of authority to do business under the laws of this state to 62 6 the resulting state credit union. The financial institution 62 7 shall then become a state credit union subject to the laws of 62 8 this state. 62 9 b. The superintendent shall furnish a copy of the 62 10 certificate to the administrator of the national credit union 62 11 administration. 62 12 3. a. Upon conversion, the existence of the original 62 13 financial institution shall cease. 62 14 b. The state credit union resulting from the conversion 62 15 shall have only the authority to engage in the business and 62 16 exercise the powers of a state credit union. 62 17 4. a. A liability of the original financial institution 62 18 or of its members, directors, or officers shall not be 62 19 affected, and any lien on any property of the financial 62 20 institution shall not be impaired by the conversion. 62 21 b. Any claim existing or action pending by or against the 62 22 original financial institution may be prosecuted to judgment 62 23 as if the conversion had not taken place, or the resulting 62 24 state credit union may be substituted in its place. 62 25 Sec. 63. NEW SECTION. 533.403 CONVERSION OF STATE CREDIT 62 26 UNION TO OTHER FINANCIAL INSTITUTION. 62 27 1. a. A state credit union may convert to another state 62 28 or federal financial institution with the approval of the 62 29 administrator of the national credit union administration and 62 30 by the affirmative vote of a majority of the credit union's 62 31 members who vote on the proposal. 62 32 b. A vote regarding conversion of a state credit union 62 33 shall be at a meeting called for that purpose and shall be in 62 34 the manner prescribed by the bylaws. 62 35 2. a. The board of directors of the state credit union 63 1 shall promptly notify the superintendent of any proposed 63 2 conversion and of any abandonment or disapproval of the 63 3 conversion by the members. 63 4 b. The board of directors of the state credit union shall 63 5 also promptly notify the superintendent of any approval or 63 6 disapproval by the administrator of the national credit union 63 7 administration of a proposed conversion. 63 8 c. The board of directors of the state credit union shall 63 9 file with the superintendent both of the following: 63 10 (a) Appropriate evidence of any approval by the 63 11 administrator of the national credit union administration of a 63 12 proposed conversion. 63 13 (b) Appropriate evidence of any approval by the new 63 14 supervisory authority. 63 15 d. The board of directors of the state credit union shall 63 16 notify the superintendent of the date on which the conversion 63 17 is to be effective. 63 18 3. Upon receipt of satisfactory proof that the state 63 19 credit union has complied with all applicable laws and 63 20 received approval from both the national credit union 63 21 administration and the new chartering authority, the 63 22 superintendent shall issue a certificate of conversion which 63 23 shall be filed and recorded in the county in which the state 63 24 credit union has its principal place of business and in the 63 25 county in which its original articles of incorporation were 63 26 filed and recorded. 63 27 Sec. 64. NEW SECTION. 533.404 DISSOLUTION GENERALLY. 63 28 The following shall apply to dissolution of a state credit 63 29 union under this chapter, whether voluntary or involuntary: 63 30 1. Distribution of the assets of the state credit union 63 31 shall be made in the following order: 63 32 a. The payment of costs and expense of the administrator 63 33 of dissolution. 63 34 b. The payment of claims for public funds deposited 63 35 pursuant to chapter 12C and the payment of claims which are 64 1 given priority by applicable statutes. If the assets are 64 2 insufficient for payment of the claims in full, priority shall 64 3 be determined by the statutes or, in the absence of 64 4 conflicting provisions, on a pro rata basis. 64 5 c. The payment of deposits, including accrued interest, up 64 6 to the date of the special meeting of the members at which 64 7 voluntary dissolution was authorized, or in the case of 64 8 involuntary dissolution, the date of appointment of a 64 9 receiver. 64 10 d. The pro rata apportionment of the balance among the 64 11 members of record on the date of the special meeting of the 64 12 members at which voluntary dissolution was authorized, or in 64 13 the case of involuntary dissolution, the members of record on 64 14 the date of appointment of a receiver. 64 15 2. All amounts due members who are unknown, or who are 64 16 under a disability and no person is legally competent to 64 17 receive the amounts, or who cannot be found after the exercise 64 18 of reasonable diligence, shall be transmitted to the treasurer 64 19 of state who shall hold the amounts in the manner prescribed 64 20 by chapter 556. All amounts due creditors as described in 64 21 section 490.1440 shall be transmitted to the treasurer of 64 22 state in accordance with that section and shall be retained by 64 23 the treasurer of state and subject to claim as provided for in 64 24 that section. 64 25 3. The superintendent shall assume custody of the records 64 26 of a state credit union dissolved pursuant to this chapter and 64 27 shall retain these records which, in the superintendent's 64 28 discretion, are deemed necessary, in accordance with the 64 29 provisions of section 533.310. The superintendent may cause 64 30 film, photographic, photostatic, or other copies of these 64 31 records to be made and the superintendent shall retain these 64 32 copies in lieu of the original records. 64 33 4. a. The dissolution of a state credit union shall not 64 34 remove or impair any remedy available to or against such 64 35 credit union, its directors, officers, or members for any 65 1 right or claim existing or any liability incurred prior to 65 2 such dissolution if an action or other proceeding to enforce 65 3 the right or claim is commenced within two years after the 65 4 date of filing of a certificate or decree of dissolution with 65 5 the county recorder in the county in which the credit union 65 6 has its principal place of business. 65 7 b. Any such action or proceeding by or against the state 65 8 credit union may be prosecuted or defended by the credit union 65 9 in its corporate name. 65 10 c. The members, directors, and officers shall have power 65 11 to take such corporate or other action as shall be appropriate 65 12 to protect such remedy, right, or claim. 65 13 Sec. 65. NEW SECTION. 533.405 VOLUNTARY DISSOLUTION. 65 14 The process of voluntary dissolution shall be as follows: 65 15 1. At a special meeting called for that purpose, a state 65 16 credit union may dissolve upon the affirmative vote of a 65 17 majority of its members eligible to vote at the special 65 18 meeting. 65 19 a. Notice of the meeting's purpose shall be contained in 65 20 the meeting's notice. 65 21 b. Any member eligible to vote and not present at the 65 22 meeting may, within twenty days after the date on which the 65 23 meeting was held, vote in favor of dissolution by signing a 65 24 statement in a form approved by the superintendent. This vote 65 25 shall have the same force and effect as if cast at the 65 26 meeting. 65 27 2. a. The state credit union shall cease to do business 65 28 except for the purposes of liquidation immediately upon giving 65 29 notice of the special meeting called for the members' vote on 65 30 dissolution. 65 31 b. The board of directors shall immediately notify the 65 32 superintendent of the intention of the credit union to 65 33 dissolve. 65 34 c. The credit union shall not resume its regular business 65 35 unless the dissolution fails to receive the required vote of 66 1 the members or unless the members have revoked prior 66 2 affirmative action to dissolve as provided for in subsection 66 3 6. 66 4 3. a. The board of directors shall have power to 66 5 terminate and settle the affairs of a state credit union in 66 6 voluntary dissolution. 66 7 b. The credit union shall continue in existence for the 66 8 purpose of discharging its liabilities, collecting and 66 9 distributing its assets, and doing all acts required in order 66 10 to terminate its affairs. 66 11 c. The credit union may sue and be sued for the purpose of 66 12 enforcing such liabilities and for the purpose of collecting 66 13 its assets until its affairs are fully settled. 66 14 d. During the course of dissolution proceedings, the 66 15 credit union shall make such reports and shall be subject to 66 16 such examinations as the superintendent may require. 66 17 e. If at any time after the affirmative vote of a majority 66 18 of the members of a credit union to dissolve the credit union, 66 19 the superintendent finds that the credit union is not making 66 20 reasonable progress toward terminating its affairs, the 66 21 superintendent may apply to the district court for appointment 66 22 of a receiver to terminate the affairs of the credit union. 66 23 f. If the superintendent finds that a dissolving credit 66 24 union is insolvent, the superintendent may proceed as 66 25 otherwise provided in this chapter. 66 26 4. a. The board of directors may appoint by resolution 66 27 any responsible person as defined in section 4.1, whose 66 28 appointment has been approved by the superintendent, to 66 29 exercise its powers to terminate and settle the affairs of the 66 30 state credit union pursuant to this section. 66 31 b. The superintendent may adopt rules pursuant to chapter 66 32 17A establishing the qualifications that must be met by such 66 33 appointees, including but not limited to filing a surety bond 66 34 with the superintendent. 66 35 5. a. Upon such proof as is satisfactory to the 67 1 superintendent that all assets have been liquidated from which 67 2 there is a reasonable expectance of realization, that the 67 3 liabilities of the state credit union have been discharged and 67 4 distribution made to its members, and that the liquidation has 67 5 been completed, the superintendent shall issue a certificate 67 6 of dissolution, which certificate shall be filed and recorded 67 7 in the county in which the credit union has its principal 67 8 place of business and in the county in which its original 67 9 articles of incorporation were filed and recorded. 67 10 b. Upon the issuance of a certificate of dissolution, the 67 11 existence of the credit union shall cease. 67 12 6. a. At any time prior to any distribution of its 67 13 assets, a state credit union may revoke the voluntary 67 14 dissolution proceedings by the affirmative vote of a majority 67 15 of its members eligible to vote. This vote, if taken, shall 67 16 be at a special meeting called for that purpose in the manner 67 17 prescribed by the bylaws. 67 18 b. The board of directors shall immediately notify the 67 19 superintendent of any such action to revoke voluntary 67 20 dissolution proceedings. 67 21 Sec. 66. NEW SECTION. 533.501 SUPERVISORY ACTION. 67 22 1. CEASE AND DESIST ORDER. 67 23 a. (1) If the superintendent has reason to believe that 67 24 an officer, director, employee, or committee member of a state 67 25 credit union has violated any law, rule, or cease and desist 67 26 order relating to a credit union, or has engaged in an unsafe 67 27 or unsound practice in conducting the business of a credit 67 28 union, the superintendent may cause notice to be served upon 67 29 the officer, director, employee, or committee member to appear 67 30 before the superintendent to show cause why the person should 67 31 not be removed from office or employment. A copy of such 67 32 notice shall be sent by certified mail or restricted certified 67 33 mail to each director of the credit union affected. 67 34 (2) If the superintendent finds that the accused has 67 35 violated a law, rule, or cease and desist order relating to a 68 1 credit union, or has engaged in an unsafe or unsound practice 68 2 in conducting the business of a state credit union, after 68 3 granting the accused reasonable opportunity to be heard, the 68 4 superintendent in the superintendent's discretion may order 68 5 that the accused be removed from office and from any position 68 6 of employment with the credit union. 68 7 (3) A copy of the order shall be served upon the accused 68 8 and upon the state credit union affected, at which time the 68 9 accused shall cease to be an officer, director, employee, or 68 10 committee member of the credit union. 68 11 b. (1) If the superintendent determines that a credit 68 12 union has violated any of the provisions of this chapter, 68 13 after notice and opportunity for hearing, the superintendent 68 14 shall order the state credit union to correct the violation, 68 15 except when the credit union is insolvent. 68 16 (2) The superintendent may specify the manner in which the 68 17 violation is to be corrected and grant the credit union not 68 18 more than sixty days within which to comply with the order. 68 19 (3) The superintendent may revoke a credit union's 68 20 certificate of approval for failure to comply with the order. 68 21 (4) If the certificate of approval has been revoked, the 68 22 superintendent may apply to the district court of the county 68 23 in which the credit union is located for the appointment of a 68 24 receiver for the credit union. 68 25 2. SUMMARY CEASE AND DESIST ORDER. 68 26 a. (1) If it appears to the superintendent that a state 68 27 credit union, or any director, officer, employee, or committee 68 28 member of a credit union, is engaging in or is about to engage 68 29 in an unsafe or unsound practice or dishonest act in 68 30 conducting the business of the credit union that is likely to 68 31 cause insolvency or substantial dissipation of assets or 68 32 earnings of the credit union, or is likely to seriously weaken 68 33 the condition of the credit union or otherwise seriously 68 34 prejudice the interests of its members, the superintendent may 68 35 issue an interim summary cease and desist order requiring the 69 1 state credit union, or any director, officer, employee, or 69 2 committee member, to cease and desist from any such practice 69 3 or act, and may take affirmative action, including suspension 69 4 of the director, officer, employee, or committee member to 69 5 prevent such insolvency, dissipation, condition, or prejudice. 69 6 (2) The interim order shall become effective upon personal 69 7 service upon the state credit union, or upon the director, 69 8 officer, employee, or committee member of the credit union, 69 9 and remain effective and enforceable pending the completion of 69 10 administrative proceedings conducted pursuant to this section 69 11 and issuance of a final order. 69 12 b. (1) The interim order shall contain a concise 69 13 statement of the facts constituting the alleged unsafe or 69 14 unsound practice or alleged dishonest act, and shall fix a 69 15 time and place at which a hearing will be held to determine 69 16 whether a final order to cease and desist should issue against 69 17 the state credit union, or any director, officer, employee, or 69 18 committee member. 69 19 (2) The hearing shall be fixed for a date not later than 69 20 thirty days after service of the interim order unless a later 69 21 date is set at the request of the party served. 69 22 (3) If the state credit union, or the director, officer, 69 23 employee, or committee member, fails to appear at the hearing, 69 24 the credit union, or the director, officer, employee, or 69 25 committee member, is deemed to have consented to the issuance 69 26 of a final cease and desist order. 69 27 (4) In the event of such consent, or if upon the record 69 28 made at the hearing the superintendent finds that any unsafe 69 29 or unsound practice or dishonest act specified in the interim 69 30 order has been established, the superintendent may issue and 69 31 serve upon the state credit union, or the director, officer, 69 32 employee, or committee member, a final order to cease and 69 33 desist from any such practice or act. The order may require 69 34 the credit union, or the director, officer, employee, or 69 35 committee member, to cease and desist from any such practice 70 1 or act and direct affirmative action, including suspension of 70 2 the director, officer, employee, or committee member. 70 3 c. (1) A hearing provided for in this section shall be 70 4 presided over by an administrative law judge appointed in 70 5 accordance with section 17A.11. 70 6 (2) The hearing shall be private, unless the 70 7 superintendent determines after full consideration of the 70 8 views of the party afforded the hearing, that a public hearing 70 9 is necessary to protect the public interest. 70 10 (3) After the hearing, and within thirty days after the 70 11 case has been submitted for decision, the superintendent shall 70 12 review the proposed order of the administrative law judge and 70 13 render a final decision, including findings of fact upon which 70 14 the decision is predicated, and issue and serve upon each 70 15 party to the proceeding an order consistent with this section. 70 16 (4) Records and information relating to the hearing shall 70 17 be confidential and not subject to subpoena. Such records and 70 18 information shall not constitute a public record under chapter 70 19 22. 70 20 d. Any final order issued by the superintendent shall 70 21 become effective upon service upon the state credit union, 70 22 director, officer, employee, or committee member. 70 23 e. In the case of violation or threatened violation of, or 70 24 failure to obey, an order, the superintendent may apply to the 70 25 district court of the county in which the state credit union 70 26 has its principal place of business for the enforcement of the 70 27 order and such court shall have jurisdiction and power to 70 28 order and require compliance with the order. 70 29 f. (1) Within ten days after a state credit union or any 70 30 director, officer, employee, or committee member is served 70 31 with a summary cease and desist order, the credit union or 70 32 director, officer, employee, or committee member affected may 70 33 apply to the district court in the county in which the credit 70 34 union has its principal place of business for an injunction 70 35 setting aside, limiting, or suspending the enforcement, 71 1 operation, or effectiveness of the interim order pending the 71 2 completion of administrative proceedings. 71 3 (2) If serious prejudice to the interests of the 71 4 superintendent, the state credit union, the officer, director, 71 5 employee, or committee member would result from a court 71 6 hearing, the court may order the judicial proceeding to be 71 7 conducted in camera. 71 8 Sec. 67. NEW SECTION. 533.502 GROUNDS FOR MANAGEMENT OF 71 9 CREDIT UNION BY SUPERINTENDENT. 71 10 1. Notwithstanding any other provision of this chapter, 71 11 the superintendent may take over the management of the 71 12 property and business of a state credit union whenever it 71 13 appears to the superintendent that any of the following 71 14 actions have occurred or conditions exist: 71 15 a. The credit union has violated any law of this state. 71 16 b. The capital of the credit union is impaired. 71 17 c. The credit union is conducting its business in an 71 18 unsafe or unsound manner. 71 19 d. The credit union is in such condition that it is 71 20 unsound, unsafe, or inexpedient for it to transact business. 71 21 e. The credit union has suspended or refused payment of 71 22 its deposits or other liabilities. 71 23 f. The credit union refuses to make its records available 71 24 to the superintendent for examination or otherwise refuses to 71 25 make available, through an officer or employee having 71 26 knowledge, information required by the superintendent for the 71 27 proper discharge of the duties of the superintendent's office. 71 28 g. The credit union neglects or refuses to observe any 71 29 order of the superintendent made pursuant to the provisions of 71 30 this chapter, unless the enforcement of such order is stayed 71 31 in a court proceeding brought by the credit union. 71 32 h. The credit union has not transacted any business or 71 33 performed any of the duties contemplated by its authorization 71 34 to do business for a period of at least one hundred eighty 71 35 days. 72 1 2. The superintendent shall thereafter manage the property 72 2 and business of the state credit union until such time as the 72 3 superintendent may relinquish to the credit union the 72 4 management, upon such conditions as the superintendent may 72 5 prescribe, or until the affairs of the credit union are 72 6 finally dissolved as provided in this chapter. 72 7 3. Judicial review of the actions of the superintendent 72 8 may be sought in accordance with chapter 17A. However, 72 9 contested case provisions of chapter 17A, the Iowa 72 10 administrative procedure Act, do not apply to an action by the 72 11 superintendent to take over the management of or to manage a 72 12 credit union, as authorized by this section. 72 13 Sec. 68. NEW SECTION. 533.503 SUPERINTENDENT AS 72 14 RECEIVER. 72 15 1. In all situations in which the superintendent has been 72 16 appointed as receiver as provided in this chapter, the 72 17 superintendent shall make a diligent effort to collect and 72 18 realize on the assets of the state credit union, and shall 72 19 make distribution of the proceeds from time to time to those 72 20 entitled in the order provided for by law. 72 21 a. The superintendent may execute as receiver, or after 72 22 the receivership has terminated, assignments, releases, and 72 23 satisfactions to effectuate sales and transfers. 72 24 b. Upon the order of the court in which the receivership 72 25 is pending, the superintendent may sell or compound all bad or 72 26 doubtful debts. 72 27 c. Upon the order of the court in which the receivership 72 28 is pending, the superintendent may sell all the real and 72 29 personal property of the credit union, on such terms as the 72 30 court shall direct. 72 31 2. All expenses of the receivership and dissolution shall 72 32 be determined by the superintendent, subject to the approval 72 33 of the district court, and shall be paid out of the assets of 72 34 the state credit union. 72 35 3. At the completion of the receivership, the 73 1 superintendent shall file a final report which shall contain 73 2 details of receivership activity and such additional facts as 73 3 the court may require. 73 4 4. a. Upon the submission and approval of the final 73 5 report, the court shall enter a decree dissolving the state 73 6 credit union and discharging the receiver, at which time the 73 7 existence of the credit union shall cease. 73 8 b. The clerk of court shall file and record certified 73 9 copies of the decree with the county recorder of the county in 73 10 which the credit union has its principal place of business and 73 11 with the county recorder of the county in which its original 73 12 articles of incorporation were filed and recorded. A fee 73 13 shall not be charged by the county recorder for the filing or 73 14 recording of such decree. 73 15 Sec. 69. NEW SECTION. 533.504 TENDER OF RECEIVERSHIP TO 73 16 INSURANCE PLAN. 73 17 1. a. The superintendent may tender to the administrator 73 18 of an account insurance plan approved under this chapter the 73 19 appointment as receiver for an insured state credit union. 73 20 b. If the insurance plan administrator accepts the 73 21 appointment as receiver, the rights of the members and other 73 22 creditors of the insured state credit union shall be 73 23 determined in accordance with the laws of this state and the 73 24 insurance plan administrator shall comply with all applicable 73 25 provisions of this chapter. 73 26 2. The administrator of an account insurance plan as 73 27 receiver shall possess the powers, rights, and privileges 73 28 given to the superintendent as provided by law. 73 29 3. If the administrator of an account insurance plan pays 73 30 or makes available for payment the insured liabilities of a 73 31 state credit union, the administrator shall be subrogated by 73 32 operation of law to all rights of the members against the 73 33 insured state credit union in the same manner and to the same 73 34 extent as subrogation is provided for in applicable laws in 73 35 the case of a closed federal credit union. 74 1 Sec. 70. NEW SECTION. 533.505 SUBPOENA – CONTEMPT. 74 2 1. The superintendent or the superintendent's designee may 74 3 subpoena witnesses, compel their attendance, administer an 74 4 oath, examine any person under oath, and require the 74 5 production of any relevant books or papers during the period 74 6 of examination. 74 7 2. An examination may be conducted on any subject relating 74 8 to the duties imposed upon or powers vested in the 74 9 superintendent. 74 10 3. Whenever a person subpoenaed pursuant to subsection 1 74 11 fails to produce documents or information or to give testimony 74 12 as required by the terms of the subpoena, the superintendent 74 13 may apply to the district court of Polk county for the 74 14 enforcement of the subpoena or the issuance of an order 74 15 compelling compliance. 74 16 4. The refusal of any person to obey an order of the 74 17 district court issued pursuant to subsection 1, without 74 18 reasonable cause, shall be considered a contempt of court. 74 19 Sec. 71. NEW SECTION. 533.506 LIMITATION OF ACTIONS. 74 20 1. All causes of action against a state credit union based 74 21 upon a claim or claims inconsistent with an entry or entries 74 22 in any credit union record or ledger, made in the regular 74 23 course of business, shall be deemed to have accrued, and shall 74 24 accrue, one year after the date of such entry or entries. 74 25 2. An action founded upon such a cause shall not be 74 26 brought after the expiration of ten years from the date of 74 27 such accrual. 74 28 Sec. 72. NEW SECTION. 533.507 FALSE STATEMENTS FOR 74 29 CREDIT. 74 30 A person who knowingly makes or causes to be made, directly 74 31 or indirectly, any false statement in writing, or who 74 32 procures, knowing that a false statement in writing has been 74 33 made concerning the financial condition or means or ability to 74 34 pay of such person or any other person in which such person is 74 35 interested or for whom such person is acting with the intent 75 1 that such statement shall be relied upon by a state credit 75 2 union for the purpose of procuring the delivery of property, 75 3 the payment of cash, or the receipt of credit in any form, for 75 4 the benefit of such person or of any other person in which 75 5 such person is interested or for whom such person is acting, 75 6 is guilty of a fraudulent practice. 75 7 Sec. 73. NEW SECTION. 533.508 FALSE STATEMENTS – 75 8 PENALTIES. 75 9 1. A director, officer, or employee of a state credit 75 10 union shall not intentionally publish, disseminate, or 75 11 distribute any advertising or notice containing any false, 75 12 misleading, or deceptive statements concerning rates, terms, 75 13 or conditions on which loans are made, or deposits or share 75 14 installments are received, or concerning any charge which the 75 15 credit union is authorized to impose pursuant to this chapter, 75 16 or concerning the financial condition of the credit union. 75 17 Any director, officer, or employee of a credit union who 75 18 violates the provisions of this section is guilty of a 75 19 fraudulent practice. 75 20 2. Any person who maliciously or with intent to deceive 75 21 makes, publishes, utters, repeats, or circulates any false 75 22 statement concerning any state credit union which imputes or 75 23 tends to impute insolvency, unsound financial condition or 75 24 financial embarrassment, or which may tend to cause or provoke 75 25 or aid in causing or provoking a general withdrawal of 75 26 deposits from such credit union, or which may otherwise injure 75 27 or tend to injure the business or goodwill of such credit 75 28 union, is guilty of a simple misdemeanor. 75 29 Sec. 74. NEW SECTION. 533.509 PENALTY FOR FALSIFICATION. 75 30 A director, officer, agent, employee, or clerk of a state 75 31 credit union who knowingly subscribes or makes any false 75 32 statements or false entries in the books of the credit union, 75 33 or knowingly subscribes or exhibits false papers with intent 75 34 to deceive any person authorized to examine its condition, or 75 35 knowingly subscribes and makes false reports, or knowingly 76 1 diverts the funds of the credit union to objects other than 76 2 those authorized by law, is guilty of a fraudulent practice 76 3 and is forever after barred from holding any office created by 76 4 this chapter. 76 5 DIVISION II 76 6 Sec. 75. Section 12C.13, Code 2003, is amended to read as 76 7 follows: 76 8 12C.13 DEPOSIT NOT MEMBERSHIP. 76 9 Notwithstanding chapter 534, the deposit of public funds in 76 10 a credit union or other association defined in section533.176 11 533.102 or 534.102 does not constitute being a shareholder, 76 12 stockholder, or owner of a corporation in violation of Article 76 13 VIII of the Constitution of the State of Iowa or any other 76 14 provision of law. 76 15 Sec. 76. Section 12C.23, subsection 3, paragraph b, Code 76 16 2003, is amended to read as follows: 76 17 b. The loss to public depositors shall be satisfied, first 76 18 through any applicable deposit insurance and then through the 76 19 sale of securities pledged by the defaulting credit union, and 76 20 then the assets of the defaulting credit union. The priority 76 21 of claims are those established pursuant to section533.2276 22 533.404, subsection 1, paragraph "b". To the extent permitted 76 23 by federal law, in the distribution of an insolvent federally 76 24 chartered credit union's assets, the order of payment of 76 25 liabilities if its assets are insufficient to pay in full all 76 26 its liabilities for which claims are made shall be in the same 76 27 order as for the equivalent type of state chartered credit 76 28 union as provided in section533.22533.404, subsection 1, 76 29 paragraph "b". 76 30 Sec. 77. Section 15E.43, subsection 1, paragraph b, Code 76 31 2003, is amended to read as follows: 76 32 b. For tax years beginning on or after January 1, 2002, a 76 33 tax credit shall be allowed against the taxes imposed in 76 34 chapter 422, divisions II, III, and V, and in chapter 432, and 76 35 against the moneys and credits tax imposed in section533.2477 1 533.329, for a portion of a taxpayer's equity investment, as 77 2 provided in subsection 2, in a community-based seed capital 77 3 fund. An individual may claim a tax credit under this 77 4 paragraph of a partnership, limited liability company, S 77 5 corporation, estate, or trust electing to have income taxed 77 6 directly to the individual. The amount claimed by the 77 7 individual shall be based upon the pro rata share of the 77 8 individual's earnings from the partnership, limited liability 77 9 company, S corporation, estate, or trust. 77 10 Sec. 78. Section 15E.45, subsection 4, Code 2003, is 77 11 amended to read as follows: 77 12 4. After verifying the eligibility of the community-based 77 13 seed capital fund, the board shall issue a tax credit 77 14 certificate to be attached to the taxpayer's tax return. The 77 15 tax credit certificate shall contain the taxpayer's name, 77 16 address, tax identification number, the amount of the tax 77 17 credit, the name of the community-based seed capital fund, and 77 18 other information required by the department of revenue and 77 19 finance. The tax credit certificate, unless rescinded by the 77 20 board, shall be accepted by the department of revenue and 77 21 finance or a local taxing district, as applicable, as payment 77 22 for taxes imposed pursuant to chapter 422, divisions II, III, 77 23 and V, and chapter 432, and as payment for the moneys and 77 24 credits tax imposed pursuant to section533.24533.329, 77 25 subject to any conditions or restrictions placed by the board 77 26 on the face of the tax credit certificate and subject to the 77 27 limitations of section 15E.43. 77 28 Sec. 79. Section 15E.51, subsection 2, Code 2003, is 77 29 amended to read as follows: 77 30 2. A tax credit shall be allowed against the taxes imposed 77 31 in chapter 422, divisions II, III, and V, and in chapter 432, 77 32 and against the moneys and credits tax imposed in section 77 33533.24533.329, for a portion of a taxpayer's equity 77 34 investment in a venture capital fund. An individual may claim 77 35 a tax credit under this section of a partnership, limited 78 1 liability company, S corporation, estate, or trust electing to 78 2 have income taxed directly to the individual. The amount 78 3 claimed by the individual shall be based upon the pro rata 78 4 share of the individual's earnings from the partnership, 78 5 limited liability company, S corporation, estate, or trust. 78 6 Sec. 80. Section 15E.62, subsection 6, Code 2003, is 78 7 amended to read as follows: 78 8 6. "Tax credit" means a contingent tax credit issued 78 9 pursuant to section 15E.66 that is available against tax 78 10 liabilities imposed by chapter 422, divisions II, III, and V, 78 11 and by chapter 432 and against the moneys and credits tax 78 12 imposed by section533.24533.329. 78 13 Sec. 81. Section 252I.1, subsection 4, Code 2003, is 78 14 amended to read as follows: 78 15 4. "Credit union" means "credit union" as defined in 78 16 section533.51533.102. 78 17 Sec. 82. Section 331.427, subsection 1, unnumbered 78 18 paragraph 1, Code 2003, is amended to read as follows: 78 19 Except as otherwise provided by state law, county revenues 78 20 from taxes and other sources for general county services shall 78 21 be credited to the general fund of the county, including 78 22 revenues received under sections 9I.11, 101A.3, 101A.7, 78 23 123.36, 123.143, 142B.6, 176A.8, 321.105, 321.152, 321G.7, 78 24 section 331.554, subsection 6, sections 341A.20, 364.3, 78 25 368.21, 422A.2, 428A.8, 430A.3, 433.15, 434.19, 445.57, 78 26 453A.35, 458A.21, 483A.12,533.24533.329, 556B.1, 583.6, 78 27 602.8108, 904.908, and 906.17, and chapter 405A, and the 78 28 following: 78 29 Sec. 83. Section 421.17A, subsection 1, paragraph c, Code 78 30 2003, is amended to read as follows: 78 31 c. "Credit union" means "credit union" as defined in 78 32 section533.51533.102. 78 33 Sec. 84. Section 535B.11, subsection 3, unnumbered 78 34 paragraph 2, Code 2003, is amended to read as follows: 78 35 Compliance with sections 524.905,533.16533.315, 534.206, 79 1 and 536A.20 shall constitute compliance with this subsection. 79 2 Sec. 85. Section 546.4, Code 2003, is amended to read as 79 3 follows: 79 4 546.4 CREDIT UNION DIVISION. 79 5 1. The credit union division shall regulate and supervise 79 6 credit unions under chapter 533. 79 7 2. The division is headed by the superintendent of credit 79 8 unions who shall be appointed pursuant to section533.5579 9 533.104. 79 10 3. The credit union review board shall perform duties 79 11 within the division as prescribed in chapter 533. 79 12 Sec. 86. Section 602.8102, subsection 73, Code 2003, is 79 13 amended to read as follows: 79 14 73. Certify copies of a decree dissolving a credit union 79 15 as provided in section533.21533.503, subsection 4. 79 16 Sec. 87. Chapter 533, Code 2003, is repealed. 79 17 Sec. 88. CODE EDITOR DIRECTIVE. 79 18 1. The Code editor shall establish the following divisions 79 19 in chapter 533: 79 20 a. Division I, entitled "administration of act", shall be 79 21 comprised of sections 533.101 through 533.117. 79 22 b. Division II, entitled "organization of credit unions", 79 23 shall be comprised of sections 533.201 through 533.213. 79 24 c. Division III, entitled "credit union operations", shall 79 25 be comprised of sections 533.301 through 533.330. 79 26 d. Division IV, entitled "merger, conversion, and 79 27 dissolution of credit unions", shall be comprised of sections 79 28 533.401 through 533.405. 79 29 e. Division V, entitled "supervisory actions, limitations, 79 30 and penalties", shall be comprised of sections 533.501 through 79 31 533.509. 79 32 2. The Code editor shall make such other revisions 79 33 throughout the Code to update references to particular 79 34 provisions of the Iowa credit union Act, and such other 79 35 revisions consistent with this Act. 80 1 EXPLANATION 80 2 This bill relates to the credit union division of the 80 3 department of commerce, revising and reorganizing the Iowa 80 4 credit union Act, Code chapter 533. Current Code chapter 533 80 5 is repealed. 80 6 The bill structures the Iowa credit union Act into five 80 7 divisions. The first, administration of chapter, groups 80 8 sections with definitions, as well as the creation of the 80 9 credit union division, and management of the division. 80 10 Provisions related to annual fees, records, and examinations 80 11 are also contained in this division. 80 12 Division II, organization of credit unions, relates to the 80 13 creation and structure of individual credit unions: the 80 14 creation of articles of incorporation and bylaws; the common 80 15 bond required for credit union membership; policies regarding 80 16 officers, directors, and committees; and membership policies. 80 17 Division III provides the details of credit union 80 18 operations: credit union powers; capitalization, reserves, 80 19 and investments; insurance; types and operation of accounts; 80 20 loans; safe deposit box policies; and taxes and other business 80 21 regulations. 80 22 Division IV covers merger, conversion, and dissolution of 80 23 credit unions. The actions in this division are primarily 80 24 voluntary acts undertaken by the credit union in changing its 80 25 business form, though some of the dissolution principles also 80 26 apply to involuntary dissolutions as well. 80 27 Division V includes supervisory actions, limitations, and 80 28 penalties, which include supervisory action by the 80 29 superintendent over credit unions and directors, officers, 80 30 employees, and committee members; management of credit unions 80 31 by the superintendent in cases of illegality or unsound 80 32 business circumstances, involuntary dissolutions, and 80 33 receiverships for insured credit unions; and penalties for 80 34 false statements and falsifications in obtaining credit. 80 35 The bill also contains revisions to other sections of the 81 1 Code that refer to particular provisions in Code chapter 533, 81 2 and updates those references according to the new section 81 3 number. 81 4 The bill also contains a directive to the Code editor to 81 5 insert formal names for the five divisions within Code chapter 81 6 533, as revised, and to make revisions throughout the Code as 81 7 necessary, in light of the revisions in Code chapter 533. 81 8 LSB 1260HC 80 81 9 jj/cf/24
Text: HSB00281 Text: HSB00283 Text: HSB00200 - HSB00299 Text: HSB Index Bills and Amendments: General Index Bill History: General Index
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