State Codes and Statutes

State Codes and Statutes

Statutes > California > Fin > 16600-16607

FINANCIAL CODE
SECTION 16600-16607



16600.  (a) A foreign (other nation) credit union that has a license
to establish and maintain an office may engage in activities at the
office as may be authorized under applicable laws of its home country
and the laws of this state.
   (b) Nothing in subdivision (a) authorizes a foreign (other nation)
credit union to engage in any activity at an office that it is not
authorized to engage in or is prohibited from engaging in under the
law of its home country, or that credit unions organized under the
laws of this state are not authorized to engage in or are prohibited
from engaging in under the laws of this state.



16601.  (a) A foreign (other nation) credit union may not expand its
field of membership in this state without first obtaining the
commissioner's approval.
   (b) An application for the commissioner's approval of an expansion
of the field of membership in this state by a foreign (other nation)
credit union shall be in the form and contain the information as may
be specified, by order or regulation, by the commissioner.



16602.  (a) The following provisions of this code apply to a foreign
(other nation) credit union that maintains a branch office or agency
with respect to its business in this state as if the foreign (other
nation) credit union were a credit union organized under the laws of
this state:
   (1) Section 14203.
   (2) Section 14204.
   (3) Section 14208.
   (4) Section 14210.
   (5) Section 14256.
   (6) Section 14409.
   (7) Section 14409.2.
   (8) Section 14602.
   (9) Section 14652.5.
   (10) Section 14655, to the extent promissory notes of the type
described in this section are carried on the books of a branch office
of a foreign (other nation) credit union.
   (11) Section 14656, to the extent promissory notes of the type
described in this section are carried on the books of a branch office
of a foreign (other nation) credit union.
   (12) Article 8 (commencing with Section 14750) of Chapter 4.
   (13) Section 14800.
   (14) Section 14802.
   (15) Section 14803.
   (16) Section 14807.
   (17) Section 14808.
   (18) Section 14809.
   (19) Article 1 (commencing with Section 14850) of Chapter 6.
   (20) Article 1 (commencing with Section 14950) of Chapter 7.
   (21) Article 2 (commencing with Section 15001) of Chapter 7.
   (22) Article 3 (commencing with Section 15050) of Chapter 7, to
the extent loans of the type described in that article are carried on
the books of a branch office of a foreign (other nation) credit
union.
   (23) Section 15102.
   (b) In addition to the laws specified in subdivision (a), the laws
of this state applicable to transactions between a credit union
organized under the laws of this state and its members and creditors
shall similarly apply to the transactions of a foreign (other nation)
credit union in this state. These laws include, but are not limited
to, consumer protection laws and laws relating to creditor rights and
remedies, commercial transactions, mortgages and deeds of trust,
bank deposits and collections, and negotiable instruments.




16603.  (a) Any foreign (other nation) credit union that is
authorized to and does maintain a branch office or agency is exempted
from the restrictions of Section 1 of Article XV of the California
Constitution relating to rates of interest upon the loan or
forbearance of any money, goods, or things in action or on accounts
after demand.
   (b) This section does not exempt a foreign (other nation) credit
union or any subsidiary from complying with all other laws and
regulations governing the business in which the foreign (other
nation) credit union or subsidiary is engaged.
   (c) This section creates and authorizes an exempt class of persons
pursuant to Section 1 of Article XV of the California Constitution.



16604.  (a) A foreign (other nation) credit union which is licensed
to establish and maintain an office or offices shall keep the assets
of the offices separate and apart from the assets of its business
outside this state.
   (b) Persons who are creditors of a foreign (other nation) credit
union as a result of the business of an office of the foreign (other
nation) credit union in this state shall be entitled to priority over
other creditors with respect to the assets of the business in this
state of the foreign (other nation) credit union.



16605.  (a) In this section:
   (1) "Adjusted liabilities," when used with respect to a foreign
(other nation) credit union, means the liabilities of the foreign
(other nation) credit union's business in this state, determined in
accordance with generally accepted accounting principles, but
excluding (A) accrued expenses, (B) any liability to an office
(whether in or outside of this state) or majority-owned subsidiary of
the foreign (other nation) credit union, and (C) other liabilities
as the commissioner may by regulation or order exclude.
   (2) "Applicable minimum," when used with respect to eligible
assets deposited or to be deposited with an approved depository by a
foreign (other nation) credit union, means the amount as the
commissioner may from time to time by regulation or order determine
to be necessary for the maintenance of sound financial condition, for
the protection of the interests of creditors of the foreign (other
nation) credit union's business in this state, or for the protection
of the public interest. However, in the case of a foreign (other
nation) credit union which is licensed to maintain a branch office,
the applicable minimum shall not be less than 5 percent of the
adjusted liabilities of the foreign (other nation) credit union.
   (3) "Approved depository," when used with respect to a foreign
(other nation) credit union, means a bank or credit union organized
under the laws of this state or a national bank headquartered in this
state that has been selected by the foreign (other nation) credit
union and approved by the commissioner for the purpose of acting as
the approved depository of the foreign (other nation) credit union
and that has filed with the commissioner, in the form as the
commissioner may by regulation or order prescribe, an agreement to
comply with all applicable provisions of this section and of any
regulation or order issued under this section.
   (4) "Eligible assets" when used with respect to a foreign (other
nation) credit union, means any of the following:
   (A) Cash.
   (B) Any negotiable certificate of deposit that (i) has a maturity
of not more than one year, (ii) is payable in the United States, and
(iii) is issued by a bank organized under the laws of a state of the
United States, by a national bank, or by a branch office of a foreign
(other nation) bank that is located in the United States.
   (C) Any banker's acceptance that is payable in the United States
and that is eligible for discount with a federal reserve bank.
   (D) Any other asset that the commissioner by regulation or order
determines to be eligible.
   Notwithstanding the foregoing provisions of this paragraph,
"eligible asset," when used with respect to a foreign (other nation)
credit union, does not include any instrument the issuer of which (i)
is, or is affiliated with, the foreign (other nation) credit union,
(ii) is domiciled in, or controlled by a person domiciled in, the
same foreign nation as the foreign (other nation) credit union, or
(iii) is, or is controlled by, the foreign nation. For purposes of
the foregoing provision, to be "affiliated" means to control, to be
controlled by, or to be under common control with; and to "control"
has the meaning set forth in subdivision (b) of Section 700.
   (b) For purposes of this section:
   (1) The amount of adjusted liabilities of a foreign (other nation)
credit union's business in this state shall be computed for the
period of time and in the manner as the commissioner may by
regulation or order prescribe.
   (2) An eligible asset shall be valued at the lesser of market or
par.
   (c) (1) Before a foreign (other nation) credit union is authorized
to transact business in this state, the foreign (other nation)
credit union shall deposit, and each foreign (other nation) credit
union that is licensed to transact business in this state shall
maintain on deposit, with an approved depository eligible assets
having a value in an amount not less than the applicable minimum.
   (2) Whenever a foreign (other nation) credit union that is
licensed to transact business in this state ceases to be so licensed,
the foreign (other nation) credit union shall thereafter maintain on
deposit with an approved depository eligible assets having a value
in an amount not less than the applicable minimum for the period of
time as the commissioner may determine to be necessary for the
protection of creditors of the foreign (other nation) credit union's
business in this state or for the protection of the public interest.
   (d) (1) No foreign (other nation) credit union that maintains
eligible assets on deposit with an approved depository pursuant to
this section shall withdraw any eligible asset except with the prior
approval of the commissioner.
   (2) No approved depository that holds eligible assets on deposit
from a foreign (other nation) credit union pursuant to this section
shall release any eligible asset except with the prior approval of
the commissioner or as otherwise provided in subdivision (h).
   (e) Any foreign (other nation) credit union that maintains
eligible assets on deposit with an approved depository pursuant to
this section shall, unless the commissioner shall have suspended or
revoked its authorization to transact business in this state or taken
possession of its property and business in this state, be entitled
to receive any income paid on eligible assets.
   (f) (1) Whenever a foreign (other nation) credit union deposits
eligible assets with, or withdraws eligible assets from, an approved
depository pursuant to this section, the foreign (other nation)
credit union shall do so in accordance with the procedures and
requirements as the commissioner may by regulation or order
prescribe.
   (2) Whenever an approved depository receives, holds, or releases
eligible assets pursuant to this section, the approved depository
shall do so in accordance with the procedures and requirements as the
commissioner may by regulation or order prescribe and shall file
with the commissioner reports as and when the commissioner may by
regulation or order require.
   (g) Whenever a foreign (other nation) credit union maintains
eligible assets on deposit with an approved depository pursuant to
this section:
   (1) The eligible assets shall be deemed to be pledged to the
commissioner for the benefit of the creditors of the foreign (other
nation) credit union's business in the state; and, notwithstanding
any provision of the Uniform Commercial Code to the contrary, the
commissioner, for the benefit of these creditors, shall be deemed to
have a security interest in the eligible assets.
   (2) The eligible assets shall be free from any lien, charge, right
of setoff, credit, or preference in connection with any claim of the
approved depository against the foreign (other nation) credit union.
   (h) (1) In case the commissioner takes possession of the property
and business of a foreign (other nation) credit union that maintains
eligible assets on deposit with an approved depository pursuant to
this section, the approved depository shall, upon order of the
commissioner, release the eligible assets to the commissioner, as
liquidator of the property and business of the foreign (other nation)
credit union.
   (2) In case a foreign (other nation) credit union that maintains
eligible assets on deposit with an approved depository pursuant to
this section fails to pay any judgment creditor of its business in
this state and the commissioner has not taken possession of the
property and business of the foreign (other nation) credit union, the
approved depository shall release the eligible assets to the
commissioner, and the commissioner shall dispose of the eligible
assets, as a court of competent jurisdiction of this state or of the
United States may order for the benefit of the judgment creditor. For
purposes of this paragraph, "judgment creditor of its business in
this state" means a person to whom the foreign (other nation) credit
union is required to pay money under a judgment that (A) arose out of
the foreign (other nation) credit union's business in this state,
(B) has been entered by a court of this state or of the United
States, (C) has become final, in that all possibility of direct
attack on the judgment by way of appeal, motion for new trial, motion
to vacate, or petition for extraordinary writ has been exhausted,
and (D) has remained unpaid for a period of not less than 60 days
after becoming final.



16607.  (a) In this section:
   (1) "Adjusted liabilities," when used with respect to a foreign
(other nation) credit union that is licensed to maintain a branch
office, means the liabilities of the foreign (other nation) credit
union's business in this state, excluding (A) accrued expenses, (B)
any liability to an office (whether in or outside of this state) or
majority-owned subsidiary of the foreign (other nation) credit union,
and (C) other liabilities as the commissioner may by regulation or
order exclude.
   (2) "Eligible assets" means any asset which the commissioner by
regulation or order determines to be eligible for purposes of this
section. However, "eligible asset," when used with respect to a
foreign (other nation) credit union that is licensed to maintain a
branch office, includes any asset which the foreign (other nation)
credit union maintains on deposit pursuant to Section 16606.
   (b) For purposes of this section, the amount of eligible assets
and the amount of adjusted liabilities of a foreign (other nation)
credit union that is licensed to maintain a branch office each be
computed for the period of time and in the manner as the commissioner
may by regulation or order prescribe.
   (c) A foreign (other nation) credit union licensed to maintain a
branch office shall hold at its branch offices in this state or at
any other place as the commissioner may approve, eligible assets in
the amount, if any, as the commissioner may from time to time by
regulation or order determine to be necessary for the maintenance of
sound financial condition, for the protection of the interests of
creditors of the foreign (other nation) credit union's business in
this state, or for the protection of the public interest. However, in
no event shall the amount exceed 108 percent of the adjusted
liabilities of the foreign (other nation) credit union's business in
this state.
   (d) If the commissioner finds, with respect to a foreign (other
nation) credit union licensed to maintain a branch office in this
state, that the action is necessary for the maintenance of sound
financial condition, for the protection of the interests of creditors
of the foreign (other nation) credit union's business in this state,
or for the protection of the public interest, the commissioner may
order the foreign (other nation) credit union to place all or part of
the eligible assets which the foreign (other nation) credit union is
required to hold under subdivision (c) in the custody of a bank
organized under the laws of this state or a national bank
headquartered in this state as the commissioner may designate, and
such assets shall be subject to the order of the commissioner.