A credit union shall have succession in its corporate name during its existence and shall have power:

1. To make contracts;

2. To sue and be sued;

3. To adopt and use a common seal and alter the same at pleasure;

4. To purchase, lease, own, hold, and dispose of any real estate, buildings, fixtures, equipment, furniture and furnishings necessary, incidental and convenient to the operation of the credit union, the aggregate book value of which shall not exceed seven percent (7%) of the total assets of the credit union, unless otherwise specifically approved by the State Credit Union Board. A credit union may lease to any tenants as the credit union deems appropriate any portion of the facilities or premises of the credit union which are not utilized in the conduct of the business of the credit union;

5. To make loans to its members for provident or productive purposes, the maturities of which shall not exceed fifteen (15) years, except as otherwise provided herein and except as otherwise approved by the State Credit Union Board, and extend lines of credit to its members, to other credit unions and to credit union organizations and to participate with other credit unions, credit union organizations or financial organizations in making loans to credit union members, other credit unions and credit union organizations in accordance with the following:

a. loans to credit union members shall be made in conformity with criteria established by the board of directors of the lending credit union; provided that:

(1) a real estate loan secured by a first mortgage lien may have a maturity not exceeding thirty (30) years or any longer term which may be authorized by the State Credit Union Board,

(2) a loan to finance a manufactured home, which shall be secured by a first lien on such manufactured home, or a second mortgage loan secured by a dwelling, shall have a maturity not exceeding fifteen (15) years or any longer term which may be allowed by the State Credit Union Board,

(3) a loan secured by the insurance or guarantee of, or with advance commitment to purchase the loan by, a state or federal governmental agency may be made for the maturity and under the terms and conditions specified in the state or federal law under which such insurance, guarantee or commitment is provided,

(4) a loan or aggregate of loans to a director or to a member of the supervisory committee or the credit committee or the credit manager of the lending credit union which exceeds Sixty Thousand Dollars ($60,000.00) plus the amount of any pledged shares shall be approved by the board of directors of the lending credit union, and

(5) loans to credit union members for which any director of the lending credit union or any member of the supervisory committee or credit committee or the credit manager of the lending credit union acts as a guarantor or endorser shall be approved by the board of directors of the lending credit union when such loan, either standing alone or when added to any outstanding loan or loans of the guarantor or endorser, exceeds Sixty Thousand Dollars ($60,000.00) plus the amount of any pledged shares,

b. loans to credit union members and other eligible borrowers shall be made in accordance with and shall be paid or amortized in accordance with any rules or regulations as may be prescribed and adopted from time to time by the State Credit Union Board, after taking into account the needs or conditions of the borrowers, the amounts and duration of the loans, the interests of the members and the credit unions and such other factors as the State Credit Union Board may deem relevant,

c. unless approval by the board of directors of the lending credit union is otherwise expressly required herein, loans to credit union members and other eligible borrowers shall be approved by the credit committee or by a loan officer of the lending credit union in accordance with criteria established by the board of directors,

d. no loan or line of credit may be made to or established for a credit union member if the amount of such loan or line of credit, when aggregated with all other outstanding loans and lines of credit made to or established for such credit union member, will cause the credit union member to be indebted to the lending credit union in an amount exceeding six percent (6%) of the greater of either (i) the paid-in and unimpaired capital and surplus of the lending credit union or (ii) an amount which is six percent (6%) of the total assets of the lending credit union,

e. a self-replenishing line of credit may be established by a credit union for any eligible borrower to a stated maximum amount on terms and conditions which may differ from the terms and conditions established for other eligible borrowers,

f. loans to other credit unions shall be approved by the board of directors of the lending credit union and shall not exceed twenty-five percent (25%) of the paid-in and unimpaired capital and surplus of the lending credit union,

g. loans to credit union organizations shall be approved by the board of directors of the lending credit union and shall not exceed one percent (1%) of the paid-in and unimpaired capital and surplus of the lending credit union, except as otherwise approved by the State Credit Union Board. A "credit union organization" means any organization which is established primarily to serve the needs of credit unions and whose business relates to the daily operations of the credit unions served by such credit union organization,

h. participation loans with other credit unions, credit union organizations or other financial organizations shall be in accordance with written policies adopted by the board of directors of the lending credit union and shall be approved by the board of directors of the lending credit union. However, a credit union which originates a loan for which participation arrangements are made in accordance with this subsection shall retain an interest of at least ten percent (10%) of the face amount of such loan,

i. a credit union may participate in any guaranteed loan program of the federal government or of this state under the terms and conditions specified in the laws under which such program is provided,

j. a credit union may finance for any person, whether or not such person is a member of the credit union, the purchase from the credit union of any real or personal property owned and held by the credit union, including any property obtained by the credit union as a result of defaults in obligations owed to the credit union, and

k. a credit union may make loans to its officers and directors and to members of its supervisory and credit committees. However, such loans shall not be made on terms more favorable than those extended to other members of the credit union. A credit union may permit officers, directors and members of its supervisory and credit committees to act as co-makers, guarantors or endorsers of loans to other credit union members;

6. To receive from its members, and other credit unions, state and federal, doing business in the United States, payments on shares and deposits, and to require such notice for withdrawal of shares and deposits as the bylaws may provide;

7. To amend its bylaws in the manner provided by the bylaws, but all amendments to the bylaws must be submitted to and approved by the State Credit Union Board before they become operative;

8. To invest its funds in accordance with the following:

a. investments shall be made in conformity with criteria established by the board of directors of the credit union and in accordance with any rules or regulations as may be prescribed and adopted from time to time by the State Credit Union Board, and

b. the following investments shall be authorized for credit unions:

(1) loans to credit union members and other loans authorized for credit unions under the laws of this state,

(2) obligations of the United States of America and obligations fully guaranteed as to principal and interest by any instrumentality or agency of the United States of America,

(3) general obligations and revenue obligations of any state or any political subdivision thereof; provided the aggregate of such investments shall not exceed ten percent (10%) of the paid-in and unimpaired capital and surplus of the credit union; and provided that such investments shall be limited to obligations rated among the three highest rating categories established by one or more national rating services for governmental obligations,

(4) obligations issued by banks for cooperatives, federal land banks, federal intermediate credit banks, federal home loan banks, the Federal Home Loan Bank Board or any corporation designated by federal law as a wholly owned government corporation, or obligations, participations or other instruments of or issued by, or fully guaranteed as to principal and interest by, the Federal National Mortgage Association or the Government National Mortgage Association, or in mortgages, obligations or other securities which are or ever have been sold by the Federal Home Loan Mortgage Corporation pursuant to the Federal Home Loan Mortgage Corporation Act, or in other obligations or other instruments or securities of the Student Loan Marketing Association, or obligations, participations, securities or other instruments of or issued by or fully guaranteed as to principal and interest by any other agency of the United States of America,

(5) shares of, deposits with or loans to other federally insured credit unions in a total amount, in either case, not exceeding twenty-five percent (25%) of the paid-in and unimpaired capital and surplus of the investing credit union,

(6) shares of, or accounts or deposits with any state or federal banks, mutual savings banks and savings and loan associations, the accounts of which are insured by an agency of the federal government,

(7) shares of, deposits with or loans to any Federal Reserve Bank or any central liquidity facility established under state or federal law,

(8) shares of, deposits with or loans to any central credit union or corporate credit union organized under state or federal law,

(9) shares of, deposits with or loans to any organization, corporation or association providing services associated with the general purposes of the investing credit union or engaging in activities incidental to the operations of any credit union; provided that such investments in the aggregate may not exceed one percent (1%) of the unimpaired capital and surplus of the investing credit union,

(10) any obligations or securities authorized for investment by federal credit unions under the laws of the United States of America. However, such investments shall be in compliance with any restrictions or limitations pertaining thereto under the laws of the United States of America or under the regulations of the National Credit Union Administration,

(11) money market funds rated among the three highest rating categories established by one or more national rating services for corporate or governmental securities,

(12) shares of mutual funds if the investments and investment transactions of the fund are authorized for credit unions under the laws of this state, or

(13) such other investments or types of investments as may be authorized from time to time by the State Credit Union Board; provided that the State Credit Union Board shall not be permitted under this specific grant of authority to authorize a credit union to purchase or own real estate solely for investment purposes;

9. To make deposits in national banks and in state banks, trust companies, savings and loan associations, and credit unions organized under the laws of this state, any other state, or the United States, operating in accordance with the laws of the State of Oklahoma, or of the laws of the United States and approved by State Credit Union Board as depositories;

10. To borrow, from any source, in an aggregate amount not exceeding fifty percent (50%) of its shares, deposits and undivided earnings; such borrowed money may be borrowed either by means of bills payable or through rediscounts of its negotiable instruments, and credit unions may pledge their assets as collateral securities therefor;

11. To fine members, in accordance with the bylaws, for failure to meet their obligations promptly to their credit union;

12. To impress and enforce a lien upon the shares, deposits, dividends, and interest of any member to the extent of any loan made to the member or endorsed by the member and any interest or fines payable by the member;

13. To charge an entrance fee as provided in the bylaws;

14. To hire clerical help;

15. To become the owner and lessor of personal property upon the specific request of and for the use of a member. A credit union may only purchase the personal property to be leased after it has completed a leasing arrangement with a member. Except upon the written approval of the Commissioner, the term of the lease shall in no event exceed ten (10) years and all such leases shall provide for the payment of regularly scheduled periodic payments, the total of which shall at least equal the cost to the credit union of the personal property so leased. The total investment by a credit union for benefit of any member, combined with all other obligations of such member to the credit union, shall at no time exceed six percent (6%) of the greater of either (i) the paid-in and unimpaired capital and surplus of the credit union or (ii) an amount which is six percent (6%) of the total assets of the credit union; and

16. To exercise such incidental powers as shall be necessary or requisite to enable it to carry on effectively the business for which it is incorporated.

§ 2007. Membership - Central credit unions [Back]

A. Credit union membership shall consist of the incorporators, and such other persons and incorporated and unincorporated organizations and their employees, as may be elected to membership. Each member shall subscribe to at least one share of the credit unions stock and pay the entrance fee. Credit union membership shall be limited to groups having a common bond of occupation or association, which shall be limited to one of the following categories:

1. Groups that have the same common bond of occupation or association;

2. Persons or organizations within a well-defined community, neighborhood or rural district; or

3. Groups which have, as to each individual group, a common bond of occupation or association, but, as to all such groups, need not have the same common bond of occupation or association as other groups within the credit union.

B. A central credit union may be organized to which members of existing credit unions operating in accordance with the law of the State of Oklahoma, or of the United States, may belong, and to which credit unions organized and operating under the State of Oklahoma or of the United States may also belong.

§ 2008. Examinations - reports - Access to information - Alternative examination or report - Failure to make and transmit or publish report - Certificate and bylaw forms - Annual financial reports [Back]

A. A regular examination of credit unions organized under the laws of this state shall be made by or under the supervision of the Administrator appointed by the State Banking Commissioner. The Administrator shall investigate and examine credit unions organized under section 2001 et seq. of this title at least every eighteen (18) months, or more often if the Administrator and the State Banking Commissioner deem it necessary. For the purpose of making such examinations, examiners shall have full access to all books, papers, securities, records and other sources of information under the control of credit unions.

B. In lieu of making an examination of a credit union, an examination or audit report of the condition of the credit union made by the National Credit Union Administration may be accepted by the Administrator.

C. Upon receipt by the credit union or any officer thereof, the report of examination shall be submitted by the officer receiving it to the board of directors and the supervisory committee for review at the next meeting of the board and duly noted in the minutes of the board in such form and in such manner as may be prescribed and directed by the Commissioner.

D. Credit unions shall report to the Administrator at least semiannually or upon request by the Administrator on forms supplied for that purpose. Every credit union which fails to make and transmit or to publish any report required within the discretion of the Administrator shall be liable for an administrative violation and subject to a fine not to exceed Five Dollars ($5.00) for each day, after the period respectively therein mentioned, that the credit union delays to make and transmit its report or its proof of publication. Whenever any credit union delays or refuses to pay the fine herein imposed for a failure to make and transmit or to publish a report, the Commissioner is hereby authorized to maintain an action in the name of the state against the delinquent credit union for the recovery of such fine, and all sums collected by such action shall be paid into the State Treasury to be credited to the General Revenue Fund.

E. In order to simplify the organization of credit unions the Administrator shall cause to be prepared a form of organization certificate which shall be used by credit unions organized hereunder and a form of bylaws consistent with section 2001 et seq. of this title, which may be used by credit union incorporators and shall be supplied upon request.

F. The Administrator shall prepare a report each year a report showing the financial condition of all credit unions under the supervision of the Administrator as of December 31 of the preceding year. The report shall be published in the annual report of the Commissioner, which shall be a public document and shall include such other matters as the Commissioner deems advisable.

§ 2009. Fiscal year - Meetings - Voting [Back]

The fiscal year of all credit unions shall end December thirty-first. The annual meeting of each credit union shall be held at such time and at such place as its bylaws shall prescribe. Special meetings may be held in the manner indicated in the bylaws. No member shall be entitled to vote by proxy but a member other than a natural person may vote through an agent designated for that purpose. Irrespective of the number of shares held by any one member, no one member shall have more than one vote.

§ 2010. Board of directors - Credit committee - Supervisory committee - Officers [Back]

A.

1. The business affairs of a credit union shall be managed by a board of not less than seven (7) members, elected by the members of the credit union, from their number, at their annual meeting, the organizational meeting being the first annual meeting, and to hold office for such terms as the bylaws may provide.

2. The bylaws of a credit union shall not prevent or restrict a member from serving as a director, unless such member has been, or is later, convicted of a crime involving dishonesty or breach of trust.

3. A record of names and addresses of the board of directors and the respective committees and officers shall be filed with the Bank Commissioner within ten (10) days after their election. No member of the board of directors shall, as such, be compensated, but the officers elected by the board of directors and the members of the credit and supervisory committees may receive such compensation for services performed as the board shall, by resolution, authorize.

4. The board of directors shall meet at least once a month, unless permitted by the Bank Commissioner to meet less often, and shall have the general direction and control of the affairs of the corporation. The minutes of all such meetings shall be kept. Among other things they shall act upon applications for membership.

5. The board shall also:

a. declare dividends and determine rates of interest on deposits,

b. fill vacancies in the board and in the credit committee until successors elected at the next annual meeting have qualified,

c. authorize investment of credit union funds other than loans to members,

d. determine from time to time the maximum number of shares and deposits that will be accepted from a member in any calendar month not inconsistent with the bylaws, and

e. subject to limitations of this act, determine the interest rates on loans and the maximum amount that may be loaned with and without security to any member, and determine the rate of interest refund, if any, to be made to members.

A majority of the board may, however, agree to exclude loans made at rates of interest lower than the basic rate of the credit union and may also exclude loans where payments are in arrears from participation in such interest rebates. All other loans shall participate at the same rate of rebate.

6. The State Credit Union Board may, by approval of implementing amendments to the bylaws of a credit union, authorize the delegation of specific powers by the board of directors of the credit union to an executive committee of the board of designated officers of the credit union. However, the delegation of any power by the board of directors, as authorized, shall not relieve the board of any existing duty or obligation for the proper exercise of the delegated power.

B.

1. At their first meeting after the annual meeting of the members, the directors shall elect from their number an executive officer, who may be designated as chairman of the board or president, a vice-chairman of the board of a vice-president, a secretary, and a treasurer, who shall be the executive officers of the corporation. The secretary and the treasurer may be the same person. The duties of the officers shall be determined by the bylaws.

2. The board of directors may employ an officer in charge of operations, whose title shall be either president and/or general manager or, in lieu thereof, the board of directors may designate the treasurer or an assistant treasurer, to act as general manager and be in active charge of the affairs of the credit union. Each active officer and employee of a credit union shall, before entering upon their duties, make and give a bond to the credit union executed by a surety company, in an amount fixed by the State Credit Union Board, for the protection of the credit union against the fraud or dishonesty of each active officer or employee of the credit union. When the bond has been executed it shall be filed with the Bank Commissioner.

3. The board of directors may appoint a membership officer and delegate to the officer the power to approve or disapprove all membership applications. The membership officer may not be the treasurer or assistant treasurer. Once apointed, the membership officer shall submit to the board of directors a list of approved or pending applications for membership at each regular meeting of the board of directors.

C.

1. A credit committee of not less than three members shall be either elected by the members or appointed by the board of directors, from the membership of the credit union, at the annual meeting of the members, or at the first meeting of the board of directors after the annual meeting of the members, as the bylaws may provide. Members of the credit committee shall hold office for such terms as specified in the bylaws. In lieu of a credit committee, a credit manager may be appointed by the board of directors, if the bylaws so provide. The credit manager shall be an officer of the credit union.

2. A credit committee, or if the bylaws so provide, a credit manager, shall have the general supervision of all loans to members. It shall be the duty of the credit committee, or if applicable, the credit manager, to provide for the review of all applications for loans, to ascertain whether or not such loan would benefit the applicant, and to determine whether or not the security offered, in the judgment of the credit committee or the credit manager, is sufficient and the terms proper. If the loans of the credit union are supervised by a credit committee, the credit committee shall meet as often as may be required after due notice has been given to each member thereof, but not less than once a month, and shall keep a record of all meetings.

3. The credit committee, or the credit manager, shall make a report to the members at the annual meeting.

4. To facilitate the work of the credit committee or the credit manager, the credit committee or the credit manager, whichever is applicable, may appoint one or more loan officers and assistants, as may be necessary. Loan officers shall act under the direction of the credit committee or the credit manager and may approve or disapprove loans, but only within written rules and regulations established by the credit committee or the credit manager. A record of loans approved by each loan officer shall be made available upon request to the credit committee or the credit manager.

D.

1. The supervisory committee shall be appointed by the board of directors unless otherwise provided in the bylaws. One director may be appointed or elected to the supervisory committee, but not the treasurer.

2. The supervisory committee shall make a semiannual examination of the affairs of the credit union, including an audit of its books; and shall make an annual audit and a report to be submitted at the annual meeting of the corporation. However, if the supervisory committee, with the approval of the board of directors, employs an auditor approved by the State Credit Union Board, a licensed public accountant or a certified public accountant to perform an annual audit of the affairs and books of the credit union, such annual audit by the outside auditor shall constitute full compliance with this subsection.

3. The supervisory committee shall make a report of any audit it causes to be conducted of the credit union at the annual meeting of the credit union.

4. By a unanimous vote, the supervisory committee may suspend any officer of the corporation, including the credit manager, or any member of the credit committee or of the board of directors until the next members' meeting, which meeting, however, shall be held within fourteen (14) days of the suspension and at which meeting the suspension shall be acted upon by the members; and, by a majority vote, may call a special meeting of the shareholders to consider any violation of this law, the charter, or of the bylaws, or any practice of the corporation deemed by the committee to be unsafe or unauthorized. The board of directors shall fill vacancies on the supervisory committee.

5. The supervisory committee shall in such manner as it deems advisable cause the accounts of the members to be verified with the records of the treasurer from time to time and not less frequently than once every two (2) years.

6. The supervisory committee shall meet as often as necessary to conduct the business of the supervisory committee and at such other times as the Commissioner may prescribe. Minutes of all such meetings shall be kept.

7. No member of the supervisory committee may be excluded from attending the meeting of the board of directors of the credit union.

[Source: Adopted: ENR. H.B. 1327, Eff. 7-1-99]

¹Section 2001 et seq. of this title.

§ 2011. Repealed by Laws 2000, eff. April 14, 2000 [Back]

§ 2012. Expulsions and withdrawals [Back]

(A) A member may be expelled by a two-thirds (2/3) vote of the members present at the annual or a special meeting called to consider the matter, but only after an opportunity has been given to the member to be heard at said meeting. Any member may withdraw from the credit union at any time but notice of withdrawal may be required.

(B) The board of directors may expel a member pursuant to a written policy adopted by it. All members shall be given written notice of the terms of any such policy. Any person expelled by the board shall have the right to request a hearing before it to reconsider the expulsion.

(C) All amounts paid on shares and deposits on an expelled or withdrawing member shall, as funds become available and after deducting all amounts due from the member to the credit union, be paid to him. Withdrawing or expelled members shall have no further rights in the credit union but are not, by such expulsion or withdrawal, released from any remaining liability to the credit union.

§ 2013. Dividends [Back]

As the bylaws may provide and, pursuant to such regulations as may be issued by the Oklahoma State Credit Union Board, the board of directors of a credit union may declare a dividend to be paid at different rates on different types of accounts from any available balances in undivided earnings. If undivided earnings are depleted, dividends can only be paid upon prior written approval of the Commissioner.