House File 360 - Introduced HOUSE FILE 360 BY COMMITTEE ON COMMERCE (SUCCESSOR TO HSB 115) A BILL FOR An Act relating to matters under the purview of the credit 1 union division of the department of commerce, and making 2 penalties applicable. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 1261HV (2) 85 rn/sc

H.F. 360 Section 1. Section 533.102, subsection 4, Code 2013, is 1 amended to read as follows: 2 4. “Credit union service organization” means a corporation , 3 or limited partnership , or limited liability company organized 4 under state law to provide financial and financial-related 5 services for one or more credit unions, each of which owns part 6 of the capital stock of the credit union service organization, 7 as authorized under section 533.301, subsection 5 , paragraph 8 “f” , and which corporation , or limited partnership , or limited 9 liability company is subject to examination by the credit 10 union division of the Iowa department of commerce or a federal 11 supervisory agency. 12 Sec. 2. Section 533.205, subsection 1, paragraph d, Code 13 2013, is amended to read as follows: 14 d. A chief financial officer whose title shall be designated 15 by the board. 16 Sec. 3. Section 533.301, subsections 28 and 29, Code 2013, 17 are amended to read as follows: 18 28. Sell, to persons in the field of membership, negotiable 19 checks, including traveler’s checks; money orders; and other 20 similar money transfer instruments including international and 21 domestic electronic fund transfers and remittance checks . 22 29. Cash checks and money orders, and send and receive 23 international and domestic electronic fund transfers and 24 remittance transfers , for persons in the field of membership. 25 Sec. 4. Section 533.401, subsection 3, paragraphs a and b, 26 Code 2013, are amended to read as follows: 27 a. Notice of the meeting called to consider balloting for 28 the membership vote on the merger was mailed to each member of 29 the merging credit union entitled to vote upon the question 30 at least twenty days prior to the date of the merger meeting 31 scheduled conclusion of the vote . 32 b. The notice of balloting disclosed the purpose of the 33 meeting vote and properly informed the membership that approval 34 of the merger would be sought pursuant to this section . 35 -1- LSB 1261HV (2) 85 rn/sc 1/ 5

H.F. 360 Sec. 5. Section 533.401, subsection 9, Code 2013, is amended 1 by striking the subsection. 2 Sec. 6. Section 533.404, subsection 4, Code 2013, is amended 3 by striking the subsection. 4 Sec. 7. Section 533.405, subsection 2, Code 2013, is amended 5 by adding the following new paragraph: 6 NEW PARAGRAPH . d. The board of directors shall notify the 7 national credit union administration of the intent to dissolve, 8 as required by federal regulation. 9 Sec. 8. Section 533.405, Code 2013, is amended by adding the 10 following new subsection: 11 NEW SUBSECTION . 4A. a. (1) Within ten days of the 12 conclusion of a membership vote approving the voluntary 13 dissolution, the board of directors or the liquidating agent 14 appointed pursuant to subsection 4 shall cause notice, as 15 provided in this subsection, to be given to creditors of the 16 state credit union to present their claims. 17 (2) A copy of the notice of voluntary dissolution shall be 18 mailed to all creditors reflected on the records of the state 19 credit union. 20 b. In addition to mailing notice to known creditors, the 21 state credit union shall also publish notice of the voluntary 22 dissolution as follows: 23 (1) State credit unions with assets in excess of five 24 million dollars as of the month ending immediately prior to the 25 date of the conclusion of the vote by the membership approving 26 the dissolution shall publish the notice once a week for two 27 successive weeks in a newspaper of general circulation in each 28 county in which the state credit union maintains an office or 29 branch for the transaction of business. 30 (2) State credit unions with assets of five million dollars 31 or less as of the month ending immediately prior to the date 32 of the conclusion of the vote by the membership approving the 33 dissolution shall publish the notice once in a newspaper of 34 general circulation in each county in which the state credit 35 -2- LSB 1261HV (2) 85 rn/sc 2/ 5

H.F. 360 union maintains an office or branch. 1 c. Mailed and published notices under this subsection shall 2 indicate all of the following: 3 (1) A creditor shall have thirty days from the date the 4 notice was sent or first published to submit the creditor’s 5 claim. The state credit union must receive the claim on or 6 before the thirtieth day, or the claim is barred. 7 (2) Information that must be included in a claim. 8 (3) A mailing address where a claim is to be sent. 9 Sec. 9. Section 533.405, subsections 5 and 6, Code 2013, are 10 amended to read as follows: 11 5. a. Upon such proof as is satisfactory to the 12 superintendent that all assets of the following have occurred, 13 the superintendent shall issue a certificate of dissolution: 14 (1) Assets have been liquidated from which there is a 15 reasonable expectance of realization , that the . 16 (2) The liabilities of the state credit union have been 17 discharged and distribution . 18 (3) Distribution has been made to its members, and that the 19 pursuant to section 533.404, subsection 1. 20 (4) The liquidation has been completed , the superintendent 21 shall issue a certificate of dissolution, which . 22 b. The certificate shall be filed and recorded in the county 23 in which the state credit union has its principal place of 24 business and in the county in which its original articles of 25 incorporation were filed and recorded. 26 b. c. Upon the issuance filing of a certificate of 27 dissolution, the existence of the state credit union shall 28 cease. 29 6. a. At any time prior to any the final distribution 30 of its assets, a state credit union may revoke the voluntary 31 dissolution proceedings by the affirmative vote of a majority 32 of its members eligible to vote, according to the provisions 33 of section 533.203 . At least twenty days’ notice shall be 34 provided between the sending of notice and the scheduled 35 -3- LSB 1261HV (2) 85 rn/sc 3/ 5

H.F. 360 conclusion of the vote. 1 b. Upon the conclusion of the vote, the board of directors 2 shall immediately notify the superintendent of any such action 3 to revoke voluntary dissolution proceedings. 4 EXPLANATION 5 This bill makes specified changes relating to the 6 administration and regulation of state credit unions. 7 The bill adds a limited liability company to the list of 8 business entities encompassed within the definition of “credit 9 union service organization” for purposes of Code chapter 10 533. Additionally, the bill modifies the designation of a 11 specified elected officer within the board of directors of 12 a credit union such that one officer shall be a financial 13 officer whose title shall be designated by the board, rather 14 than a “chief” financial officer as the position is currently 15 described. Also, the bill specifies that credit unions shall 16 be authorized to sell remittance checks to, and send and 17 receive remittance transfers for, persons in the credit union’s 18 field of membership. 19 The bill alters one of the requirements for approval by 20 the superintendent of credit unions of a credit union merger. 21 References to a meeting to be held on the question of merger 22 are changed to balloting upon the question. The bill deletes a 23 definition of the terms “merger” or “merge” within the context 24 of a credit union merger. 25 Relating to the dissolution of a credit union, the bill 26 deletes a provision which currently preserves remedies 27 available to or against a credit union or its directors, 28 officers, or members for rights or claims existing or liability 29 incurred prior to a voluntary or involuntary dissolution if 30 an action or other proceeding to enforce the right or claim 31 was commenced within two years after the date of filing of 32 a certificate or decree of dissolution. Also with regard to 33 dissolution, the bill adds that the board of directors of a 34 credit union undergoing dissolution shall notify the national 35 -4- LSB 1261HV (2) 85 rn/sc 4/ 5

H.F. 360 credit union administration of its intent to dissolve. 1 The bill further modifies voluntary dissolution provisions 2 to establish creditor notification requirements and procedures 3 concerning the presentation of claims and requirements that 4 must be satisfied prior to issuance of a certificate of 5 dissolution. 6 -5- LSB 1261HV (2) 85 rn/sc 5/ 5