State Codes and Statutes

Statutes > California > Fin > 5100-5124

FINANCIAL CODE
SECTION 5100-5124



5100.  When used in this division, the words and phrases set forth
in this article shall have the meanings given in this article unless
the context requires another meaning.



5100.2.  For purposes of this division:
   (a) Any reference to regulations of the federal Office of Thrift
Supervision or the Federal Deposit Insurance Corporation shall also
be deemed to include and refer to regulations adopted by the Federal
Home Loan Bank Board or the Federal Savings and Loan Insurance
Corporation, to the extent these regulations have been continued in
effect and made enforceable by the Office of Thrift Supervision or
Federal Deposit Insurance Corporation, respectively, pursuant to the
Financial Institutions Reform, Recovery, and Enforcement Act of 1989
(Public Law 101-73).
   (b) Any reference to charters issued by the Office of Thrift
Supervision shall also be deemed to include and refer to charters
issued by the Federal Home Loan Bank Board.



5100.5.  "Affiliated person" of a savings association means the
following:
   (a) A director, officer, or controlling person of the savings
association.
   (b) A spouse of a director, officer, controlling person of the
savings association.
   (c) A member of the immediate family of a director, officer, or
controlling person of the savings association, who has the same home
as that person or who is a director or officer of any subsidiary of
the savings association or of any holding company affiliate of the
savings association.
   (d) Any corporation or organization other than the savings
association or a corporation or organization through which the
savings association operates, of which a director, officer or
controlling person of the savings association meets any of the
following criteria:
   (1) Is chief executive officer, chief financial officer, or a
person performing similar functions.
   (2) Is a general partner.
   (3) Is a limited partner who, directly or indirectly either alone
or with his spouse and the members of his immediate family who are
also affiliated persons of the savings association, owns an interest
of 10 percent or more in the partnership (based on the value of his
contribution) or who, directly or indirectly with other directors,
officers, and controlling persons of the savings association and
their spouses and their immediate family members who are also
affiliated persons of the savings association owns an interest of 25
percent or more in the partnership.
   (4) Directly or indirectly either alone or with his or her spouse
and the members of his or her immediate family who are also
affiliated persons of the savings association, owns or controls 10
percent or more of any class of equity securities or owns or
controls, with other directors, officers, and controlling persons of
the savings association and their spouses and their immediate family
members who are also affiliated persons of the savings association,
25 percent or more of any class of equity securities.
   (e) Any trust or other estate in which a director, officer, or
controlling person of the savings association or the spouse of the
person has a substantial beneficial interest or as to which the
person or his or her spouse serves as trustee or in a similar
fiduciary capacity.


5100.6.  "Affiliate" of a savings association, unless otherwise
defined, includes any corporation, business trust, unincorporated
association or other similar organization which meets the criteria of
subdivision (a), (b), or (c), as follows:
   (a) The savings association directly or indirectly, owns or
controls either a majority of the voting shares or more than 50 per
centum of the number of shares voted for the election of its
directors, trustees, or other persons exercising similar functions at
the preceding election, or controls in any manner the election of a
majority of its directors, trustees, or other persons exercising
similar functions.
   (b) Control thereof is held, directly or indirectly through stock
ownership or in any other manner, by the shareholders of a savings
association who own or control either a majority of the shares of the
savings association or more than 50 per centum of the number of
shares voted for the election of directors of that savings
association at the preceding election, or by trustees for the benefit
of the shareholders of any savings association.
   (c) A majority of its directors, trustees, or other persons
exercising similar functions are directors of any one savings
association.



5100.7.  "Controlling person" of a savings association means any
person or entity which (a) either directly or indirectly or acting in
concert with one or more other persons or entities, owns, controls,
or holds with power to vote, or holds proxies representing, 10
percent or more of the voting shares or rights of the association or
(b) controls in any manner the election or appointment of a majority
of the directors of the association. However, a director of a savings
association shall not be deemed to be a controlling person of the
association based upon his or her voting, or acting in concert with
other directors in voting, proxies (a) obtained in connection with an
annual solicitation of proxies or (b) obtained from savings account
holders and borrowers if the proxies are voted as directed by a
majority vote of the entire board of directors of that association,
or of a committee of those directors if the committee's composition
and authority are controlled by a majority vote of the entire board
and if its authority is revocable by such a majority.



5100.8.  "Immediate family" of any natural person means any of the
following (whether by the full or half blood or by adoption):
   (a) The person's spouse, father, mother, children, brothers,
sisters, and grandchildren.
   (b) The father, mother, brothers, and sisters of the person's
spouse.
   (c) The spouse of a child, brother, or sister of the person.



5100.9.  "Institution-affiliated party" means any of the following:
   (a) Any director, officer, employee or controlling stockholder of,
or agent for, a savings association.
   (b) Any person who has filed or is required to file an application
to become a savings and loan holding company with the commissioner
pursuant to Section 5801.
   (c) Any shareholder, consultant, joint venture partner, and any
other person as determined by the commissioner (by regulation or
case-by-case) who participates in the conduct of the affairs of a
savings association.
   (d) Any independent contractor (including any attorney, appraiser,
or accountant) who knowingly or recklessly participates in any of
the following which caused or is likely to cause more than a minimal
financial loss to, or a significant adverse effect on, the savings
association:
   (1) Any violation of law or regulation.
   (2) Any breach of fiduciary duty.
   (3) Any unsafe or unsound practice.



5101.  "Approved by the members," in the case of a mutual
association, means approved by a majority of all votes cast at a duly
held regular or special meeting or by the written consent (including
consents by proxy) of a majority of the total votes of members
outstanding at the close of business on the next business day prior
to the date that the requisite written consents have been filed with
the association.



5102.  (a) "Association" or "savings association" means a mutual or
stock savings association, savings and loan association or savings
bank subject to the provisions of this division, but excluding a
federal association.
   (b) "Federal association" means a savings and loan association or
federal savings bank that is chartered by the Office of Thrift
Supervision under Section 5 of the Home Owners' Loan Act of 1933 (12
U.S.C. Sec. 1464), as amended.



5103.  "Certificate of authority" means:
   (a) A certificate of authority to transact the business of an
association, which is issued by the commissioner pursuant to this
division.
   (b) An uncanceled annual license issued to an association under
prior law which is valid on the effective date of this division.



5103.5.  "Commercial paper" means any note, draft, or bill of
exchange which arises out of a current transaction or the proceeds of
which have been or are to be used for current transactions, and
which has a maturity at the time of issuance of not exceeding nine
months, exclusive of days of grace, or any renewal thereof the
maturity of which is likewise limited.



5104.  "Commissioner" means the Commissioner of Financial
Institutions.


5105.  "Community" means a centralized area or locality in which a
body of inhabitants is gathered in one group having common
residential, social, or business interests. The term does not
necessarily mean a municipal corporation or other political
subdivision. A community need not be limited by lines and boundaries.
A city, village, town, or other governmental unit, either
incorporated or unincorporated, may constitute one community, but a
large, populous area under one or more forms of government may be
composed of several communities.



5105.5.  "Consumer loan" means a loan for personal, family, or
household purposes, and loans reasonably incident thereto, and may be
made as either open-end or closed-end consumer credit, but does not
include credit extended in connection with credit cards or bona fide
overdraft loans.



5105.8.  "Corporate debt security" means a marketable obligation,
evidencing the indebtedness of any corporation in the form of a bond,
note, or debenture, or both note and debenture, which is commonly
regarded as a debt security and is not predominantly speculative in
nature. A security is marketable if it may be sold with reasonable
promptness at a price which corresponds reasonably to its fair value.




5106.  "Department" means the Department of Financial Institutions.



5107.  "Financial institution" means a thrift institution,
commercial bank, or trust company.



5108.  "Impaired condition" means a condition in which the assets of
an association in the aggregate do not have a value, as determined
in accordance with generally accepted accounting principles, equal to
or greater than the aggregate amount of liabilities of the
association to its creditors, including the holders of its savings
accounts and all other persons who are creditors.



5109.  "Mutual association" means an association for which the
articles of incorporation do not authorize the issuance of capital
stock.


5110.  "Member" means a person holding a savings account of a mutual
association. A joint and survivorship or other multiple owner
constitutes a single membership.



5111.  "Mutual capital certificate" means a certificate evidencing
an investment in a mutual association and issued pursuant to
provisions of this division.


5112.  "Net worth certificate" means a certificate issued by an
association in accordance with Section 13i of the Federal Deposit
Insurance Act, as amended (12 U.S.C., Sec. 1823i) and regulations
promulgated thereunder by the Federal Deposit Insurance Corporation.




5113.  "Person" means any individual, domestic, or foreign
corporation, entity, voting trust, business trust, partnership,
limited liability company, association, syndicate, organized group of
persons, or similar organization, group or entity, whether
incorporated or not.



5114.  "Primarily residential property" means real estate on which
there is located, or will be located pursuant to a real estate loan,
any of the following:
   (a) A structure or structures designed or used primarily for
residential rather than nonresidential purposes and consisting of
more than one dwelling unit.
   (b) A structure or structures designed or used primarily for
residential rather than nonresidential purposes for students,
residents, and persons under the care of, or the employees or members
of the staff of, an educational, health, or welfare institution or
facility.
   (c) A structure or structures that are used in part for
residential purposes for not more than one family and in part for
business purposes if the residential use of the structure or
structures is substantial and permanent and not merely transitory.



5114.5.  "Residential real estate" means any improved real property
that is used or intended to be used as a residence and contains not
more than four dwelling units.



5115.  "Real estate loan" means a loan or other obligation secured
by a lien on real estate, if:
   (a) The security property is real estate as defined pursuant to
Section 658 of the Civil Code.
   (b) The security interest of the association may be enforced as a
real estate mortgage, deed of trust, or its equivalent.
   (c) The security property is capable of separate appraisal.
   (d) The association relies substantially upon the real estate as
primary security for the loan.
   (e) With regard to security property which is a leasehold or other
interest for a period of years, the term of interest extends, or is
subject to extension or renewal at the option of the association, for
a term of at least five years following maturity of the loan.



5116.  "Savings account" means that part of the savings liability of
an association that is credited to the holder of the account. A
savings account may be referred to as a deposit. For the purposes of
Sections 6661, 6662, and 6663 and Article 4 (commencing with Section
6725) through Article 10 (commencing with Section 7000), inclusive,
of Chapter 5 of this division, the term "savings account" includes
shares, demand accounts, savings deposits and other savings accounts
of federal associations.



5117.  "Savings bank" means a savings bank organized under this
division.


5117.5.  "Savings institution" means a financial institution as
defined in Section 5102.



5118.  "Savings liability" means the aggregate amount of savings
accounts of depositors, including interest credited to the accounts,
less redemptions and withdrawals.



5119.  "Service corporation" means a corporation, other than a
wholly owned subsidiary referred to in Section 7300 or a wholly owned
subsidiary doing business as a finance subsidiary in accordance with
the requirements of 12 C.F.R. 563.132, in which at least 80 percent
of the shares of stock having voting power are owned by one or more
associations or federal associations. As used in this section "voting
power" shall have the same meaning as defined in Section 194.5 of
the Corporations Code.



5120.  "Statutory net worth" or "net worth" means the sum of the
following:
   (a) Issued and outstanding capital stock.
   (b) Issued and outstanding capital certificates.
   (c) Paid-in surplus.
   (d) Retained earnings.
   (e) Pledged savings accounts of a mutual association with the
approval of the commissioner.
   (f) General reserves and other amounts as the commissioner
prescribes.


5121.  "Stock association" means an association for which the
articles of incorporation authorize the issuance of capital stock.



5122.  "Stockholder" means the holder of one or more shares of any
class of capital stock of a capital stock association which is
organized and operating pursuant to the provisions of this division.



5123.  "Thrift institution" means an association, a cooperative
bank, a homestead association, a building and loan association, a
federal association, a federal savings bank, a state or federal
credit union, an industrial loan company, and a supervised thrift and
residential financing institution of a substantially similar nature.




5124.  "Withdrawal value" means the amount credited to a savings
account less lawful deductions, as shown by the records of the
association.

State Codes and Statutes

Statutes > California > Fin > 5100-5124

FINANCIAL CODE
SECTION 5100-5124



5100.  When used in this division, the words and phrases set forth
in this article shall have the meanings given in this article unless
the context requires another meaning.



5100.2.  For purposes of this division:
   (a) Any reference to regulations of the federal Office of Thrift
Supervision or the Federal Deposit Insurance Corporation shall also
be deemed to include and refer to regulations adopted by the Federal
Home Loan Bank Board or the Federal Savings and Loan Insurance
Corporation, to the extent these regulations have been continued in
effect and made enforceable by the Office of Thrift Supervision or
Federal Deposit Insurance Corporation, respectively, pursuant to the
Financial Institutions Reform, Recovery, and Enforcement Act of 1989
(Public Law 101-73).
   (b) Any reference to charters issued by the Office of Thrift
Supervision shall also be deemed to include and refer to charters
issued by the Federal Home Loan Bank Board.



5100.5.  "Affiliated person" of a savings association means the
following:
   (a) A director, officer, or controlling person of the savings
association.
   (b) A spouse of a director, officer, controlling person of the
savings association.
   (c) A member of the immediate family of a director, officer, or
controlling person of the savings association, who has the same home
as that person or who is a director or officer of any subsidiary of
the savings association or of any holding company affiliate of the
savings association.
   (d) Any corporation or organization other than the savings
association or a corporation or organization through which the
savings association operates, of which a director, officer or
controlling person of the savings association meets any of the
following criteria:
   (1) Is chief executive officer, chief financial officer, or a
person performing similar functions.
   (2) Is a general partner.
   (3) Is a limited partner who, directly or indirectly either alone
or with his spouse and the members of his immediate family who are
also affiliated persons of the savings association, owns an interest
of 10 percent or more in the partnership (based on the value of his
contribution) or who, directly or indirectly with other directors,
officers, and controlling persons of the savings association and
their spouses and their immediate family members who are also
affiliated persons of the savings association owns an interest of 25
percent or more in the partnership.
   (4) Directly or indirectly either alone or with his or her spouse
and the members of his or her immediate family who are also
affiliated persons of the savings association, owns or controls 10
percent or more of any class of equity securities or owns or
controls, with other directors, officers, and controlling persons of
the savings association and their spouses and their immediate family
members who are also affiliated persons of the savings association,
25 percent or more of any class of equity securities.
   (e) Any trust or other estate in which a director, officer, or
controlling person of the savings association or the spouse of the
person has a substantial beneficial interest or as to which the
person or his or her spouse serves as trustee or in a similar
fiduciary capacity.


5100.6.  "Affiliate" of a savings association, unless otherwise
defined, includes any corporation, business trust, unincorporated
association or other similar organization which meets the criteria of
subdivision (a), (b), or (c), as follows:
   (a) The savings association directly or indirectly, owns or
controls either a majority of the voting shares or more than 50 per
centum of the number of shares voted for the election of its
directors, trustees, or other persons exercising similar functions at
the preceding election, or controls in any manner the election of a
majority of its directors, trustees, or other persons exercising
similar functions.
   (b) Control thereof is held, directly or indirectly through stock
ownership or in any other manner, by the shareholders of a savings
association who own or control either a majority of the shares of the
savings association or more than 50 per centum of the number of
shares voted for the election of directors of that savings
association at the preceding election, or by trustees for the benefit
of the shareholders of any savings association.
   (c) A majority of its directors, trustees, or other persons
exercising similar functions are directors of any one savings
association.



5100.7.  "Controlling person" of a savings association means any
person or entity which (a) either directly or indirectly or acting in
concert with one or more other persons or entities, owns, controls,
or holds with power to vote, or holds proxies representing, 10
percent or more of the voting shares or rights of the association or
(b) controls in any manner the election or appointment of a majority
of the directors of the association. However, a director of a savings
association shall not be deemed to be a controlling person of the
association based upon his or her voting, or acting in concert with
other directors in voting, proxies (a) obtained in connection with an
annual solicitation of proxies or (b) obtained from savings account
holders and borrowers if the proxies are voted as directed by a
majority vote of the entire board of directors of that association,
or of a committee of those directors if the committee's composition
and authority are controlled by a majority vote of the entire board
and if its authority is revocable by such a majority.



5100.8.  "Immediate family" of any natural person means any of the
following (whether by the full or half blood or by adoption):
   (a) The person's spouse, father, mother, children, brothers,
sisters, and grandchildren.
   (b) The father, mother, brothers, and sisters of the person's
spouse.
   (c) The spouse of a child, brother, or sister of the person.



5100.9.  "Institution-affiliated party" means any of the following:
   (a) Any director, officer, employee or controlling stockholder of,
or agent for, a savings association.
   (b) Any person who has filed or is required to file an application
to become a savings and loan holding company with the commissioner
pursuant to Section 5801.
   (c) Any shareholder, consultant, joint venture partner, and any
other person as determined by the commissioner (by regulation or
case-by-case) who participates in the conduct of the affairs of a
savings association.
   (d) Any independent contractor (including any attorney, appraiser,
or accountant) who knowingly or recklessly participates in any of
the following which caused or is likely to cause more than a minimal
financial loss to, or a significant adverse effect on, the savings
association:
   (1) Any violation of law or regulation.
   (2) Any breach of fiduciary duty.
   (3) Any unsafe or unsound practice.



5101.  "Approved by the members," in the case of a mutual
association, means approved by a majority of all votes cast at a duly
held regular or special meeting or by the written consent (including
consents by proxy) of a majority of the total votes of members
outstanding at the close of business on the next business day prior
to the date that the requisite written consents have been filed with
the association.



5102.  (a) "Association" or "savings association" means a mutual or
stock savings association, savings and loan association or savings
bank subject to the provisions of this division, but excluding a
federal association.
   (b) "Federal association" means a savings and loan association or
federal savings bank that is chartered by the Office of Thrift
Supervision under Section 5 of the Home Owners' Loan Act of 1933 (12
U.S.C. Sec. 1464), as amended.



5103.  "Certificate of authority" means:
   (a) A certificate of authority to transact the business of an
association, which is issued by the commissioner pursuant to this
division.
   (b) An uncanceled annual license issued to an association under
prior law which is valid on the effective date of this division.



5103.5.  "Commercial paper" means any note, draft, or bill of
exchange which arises out of a current transaction or the proceeds of
which have been or are to be used for current transactions, and
which has a maturity at the time of issuance of not exceeding nine
months, exclusive of days of grace, or any renewal thereof the
maturity of which is likewise limited.



5104.  "Commissioner" means the Commissioner of Financial
Institutions.


5105.  "Community" means a centralized area or locality in which a
body of inhabitants is gathered in one group having common
residential, social, or business interests. The term does not
necessarily mean a municipal corporation or other political
subdivision. A community need not be limited by lines and boundaries.
A city, village, town, or other governmental unit, either
incorporated or unincorporated, may constitute one community, but a
large, populous area under one or more forms of government may be
composed of several communities.



5105.5.  "Consumer loan" means a loan for personal, family, or
household purposes, and loans reasonably incident thereto, and may be
made as either open-end or closed-end consumer credit, but does not
include credit extended in connection with credit cards or bona fide
overdraft loans.



5105.8.  "Corporate debt security" means a marketable obligation,
evidencing the indebtedness of any corporation in the form of a bond,
note, or debenture, or both note and debenture, which is commonly
regarded as a debt security and is not predominantly speculative in
nature. A security is marketable if it may be sold with reasonable
promptness at a price which corresponds reasonably to its fair value.




5106.  "Department" means the Department of Financial Institutions.



5107.  "Financial institution" means a thrift institution,
commercial bank, or trust company.



5108.  "Impaired condition" means a condition in which the assets of
an association in the aggregate do not have a value, as determined
in accordance with generally accepted accounting principles, equal to
or greater than the aggregate amount of liabilities of the
association to its creditors, including the holders of its savings
accounts and all other persons who are creditors.



5109.  "Mutual association" means an association for which the
articles of incorporation do not authorize the issuance of capital
stock.


5110.  "Member" means a person holding a savings account of a mutual
association. A joint and survivorship or other multiple owner
constitutes a single membership.



5111.  "Mutual capital certificate" means a certificate evidencing
an investment in a mutual association and issued pursuant to
provisions of this division.


5112.  "Net worth certificate" means a certificate issued by an
association in accordance with Section 13i of the Federal Deposit
Insurance Act, as amended (12 U.S.C., Sec. 1823i) and regulations
promulgated thereunder by the Federal Deposit Insurance Corporation.




5113.  "Person" means any individual, domestic, or foreign
corporation, entity, voting trust, business trust, partnership,
limited liability company, association, syndicate, organized group of
persons, or similar organization, group or entity, whether
incorporated or not.



5114.  "Primarily residential property" means real estate on which
there is located, or will be located pursuant to a real estate loan,
any of the following:
   (a) A structure or structures designed or used primarily for
residential rather than nonresidential purposes and consisting of
more than one dwelling unit.
   (b) A structure or structures designed or used primarily for
residential rather than nonresidential purposes for students,
residents, and persons under the care of, or the employees or members
of the staff of, an educational, health, or welfare institution or
facility.
   (c) A structure or structures that are used in part for
residential purposes for not more than one family and in part for
business purposes if the residential use of the structure or
structures is substantial and permanent and not merely transitory.



5114.5.  "Residential real estate" means any improved real property
that is used or intended to be used as a residence and contains not
more than four dwelling units.



5115.  "Real estate loan" means a loan or other obligation secured
by a lien on real estate, if:
   (a) The security property is real estate as defined pursuant to
Section 658 of the Civil Code.
   (b) The security interest of the association may be enforced as a
real estate mortgage, deed of trust, or its equivalent.
   (c) The security property is capable of separate appraisal.
   (d) The association relies substantially upon the real estate as
primary security for the loan.
   (e) With regard to security property which is a leasehold or other
interest for a period of years, the term of interest extends, or is
subject to extension or renewal at the option of the association, for
a term of at least five years following maturity of the loan.



5116.  "Savings account" means that part of the savings liability of
an association that is credited to the holder of the account. A
savings account may be referred to as a deposit. For the purposes of
Sections 6661, 6662, and 6663 and Article 4 (commencing with Section
6725) through Article 10 (commencing with Section 7000), inclusive,
of Chapter 5 of this division, the term "savings account" includes
shares, demand accounts, savings deposits and other savings accounts
of federal associations.



5117.  "Savings bank" means a savings bank organized under this
division.


5117.5.  "Savings institution" means a financial institution as
defined in Section 5102.



5118.  "Savings liability" means the aggregate amount of savings
accounts of depositors, including interest credited to the accounts,
less redemptions and withdrawals.



5119.  "Service corporation" means a corporation, other than a
wholly owned subsidiary referred to in Section 7300 or a wholly owned
subsidiary doing business as a finance subsidiary in accordance with
the requirements of 12 C.F.R. 563.132, in which at least 80 percent
of the shares of stock having voting power are owned by one or more
associations or federal associations. As used in this section "voting
power" shall have the same meaning as defined in Section 194.5 of
the Corporations Code.



5120.  "Statutory net worth" or "net worth" means the sum of the
following:
   (a) Issued and outstanding capital stock.
   (b) Issued and outstanding capital certificates.
   (c) Paid-in surplus.
   (d) Retained earnings.
   (e) Pledged savings accounts of a mutual association with the
approval of the commissioner.
   (f) General reserves and other amounts as the commissioner
prescribes.


5121.  "Stock association" means an association for which the
articles of incorporation authorize the issuance of capital stock.



5122.  "Stockholder" means the holder of one or more shares of any
class of capital stock of a capital stock association which is
organized and operating pursuant to the provisions of this division.



5123.  "Thrift institution" means an association, a cooperative
bank, a homestead association, a building and loan association, a
federal association, a federal savings bank, a state or federal
credit union, an industrial loan company, and a supervised thrift and
residential financing institution of a substantially similar nature.




5124.  "Withdrawal value" means the amount credited to a savings
account less lawful deductions, as shown by the records of the
association.


State Codes and Statutes

State Codes and Statutes

Statutes > California > Fin > 5100-5124

FINANCIAL CODE
SECTION 5100-5124



5100.  When used in this division, the words and phrases set forth
in this article shall have the meanings given in this article unless
the context requires another meaning.



5100.2.  For purposes of this division:
   (a) Any reference to regulations of the federal Office of Thrift
Supervision or the Federal Deposit Insurance Corporation shall also
be deemed to include and refer to regulations adopted by the Federal
Home Loan Bank Board or the Federal Savings and Loan Insurance
Corporation, to the extent these regulations have been continued in
effect and made enforceable by the Office of Thrift Supervision or
Federal Deposit Insurance Corporation, respectively, pursuant to the
Financial Institutions Reform, Recovery, and Enforcement Act of 1989
(Public Law 101-73).
   (b) Any reference to charters issued by the Office of Thrift
Supervision shall also be deemed to include and refer to charters
issued by the Federal Home Loan Bank Board.



5100.5.  "Affiliated person" of a savings association means the
following:
   (a) A director, officer, or controlling person of the savings
association.
   (b) A spouse of a director, officer, controlling person of the
savings association.
   (c) A member of the immediate family of a director, officer, or
controlling person of the savings association, who has the same home
as that person or who is a director or officer of any subsidiary of
the savings association or of any holding company affiliate of the
savings association.
   (d) Any corporation or organization other than the savings
association or a corporation or organization through which the
savings association operates, of which a director, officer or
controlling person of the savings association meets any of the
following criteria:
   (1) Is chief executive officer, chief financial officer, or a
person performing similar functions.
   (2) Is a general partner.
   (3) Is a limited partner who, directly or indirectly either alone
or with his spouse and the members of his immediate family who are
also affiliated persons of the savings association, owns an interest
of 10 percent or more in the partnership (based on the value of his
contribution) or who, directly or indirectly with other directors,
officers, and controlling persons of the savings association and
their spouses and their immediate family members who are also
affiliated persons of the savings association owns an interest of 25
percent or more in the partnership.
   (4) Directly or indirectly either alone or with his or her spouse
and the members of his or her immediate family who are also
affiliated persons of the savings association, owns or controls 10
percent or more of any class of equity securities or owns or
controls, with other directors, officers, and controlling persons of
the savings association and their spouses and their immediate family
members who are also affiliated persons of the savings association,
25 percent or more of any class of equity securities.
   (e) Any trust or other estate in which a director, officer, or
controlling person of the savings association or the spouse of the
person has a substantial beneficial interest or as to which the
person or his or her spouse serves as trustee or in a similar
fiduciary capacity.


5100.6.  "Affiliate" of a savings association, unless otherwise
defined, includes any corporation, business trust, unincorporated
association or other similar organization which meets the criteria of
subdivision (a), (b), or (c), as follows:
   (a) The savings association directly or indirectly, owns or
controls either a majority of the voting shares or more than 50 per
centum of the number of shares voted for the election of its
directors, trustees, or other persons exercising similar functions at
the preceding election, or controls in any manner the election of a
majority of its directors, trustees, or other persons exercising
similar functions.
   (b) Control thereof is held, directly or indirectly through stock
ownership or in any other manner, by the shareholders of a savings
association who own or control either a majority of the shares of the
savings association or more than 50 per centum of the number of
shares voted for the election of directors of that savings
association at the preceding election, or by trustees for the benefit
of the shareholders of any savings association.
   (c) A majority of its directors, trustees, or other persons
exercising similar functions are directors of any one savings
association.



5100.7.  "Controlling person" of a savings association means any
person or entity which (a) either directly or indirectly or acting in
concert with one or more other persons or entities, owns, controls,
or holds with power to vote, or holds proxies representing, 10
percent or more of the voting shares or rights of the association or
(b) controls in any manner the election or appointment of a majority
of the directors of the association. However, a director of a savings
association shall not be deemed to be a controlling person of the
association based upon his or her voting, or acting in concert with
other directors in voting, proxies (a) obtained in connection with an
annual solicitation of proxies or (b) obtained from savings account
holders and borrowers if the proxies are voted as directed by a
majority vote of the entire board of directors of that association,
or of a committee of those directors if the committee's composition
and authority are controlled by a majority vote of the entire board
and if its authority is revocable by such a majority.



5100.8.  "Immediate family" of any natural person means any of the
following (whether by the full or half blood or by adoption):
   (a) The person's spouse, father, mother, children, brothers,
sisters, and grandchildren.
   (b) The father, mother, brothers, and sisters of the person's
spouse.
   (c) The spouse of a child, brother, or sister of the person.



5100.9.  "Institution-affiliated party" means any of the following:
   (a) Any director, officer, employee or controlling stockholder of,
or agent for, a savings association.
   (b) Any person who has filed or is required to file an application
to become a savings and loan holding company with the commissioner
pursuant to Section 5801.
   (c) Any shareholder, consultant, joint venture partner, and any
other person as determined by the commissioner (by regulation or
case-by-case) who participates in the conduct of the affairs of a
savings association.
   (d) Any independent contractor (including any attorney, appraiser,
or accountant) who knowingly or recklessly participates in any of
the following which caused or is likely to cause more than a minimal
financial loss to, or a significant adverse effect on, the savings
association:
   (1) Any violation of law or regulation.
   (2) Any breach of fiduciary duty.
   (3) Any unsafe or unsound practice.



5101.  "Approved by the members," in the case of a mutual
association, means approved by a majority of all votes cast at a duly
held regular or special meeting or by the written consent (including
consents by proxy) of a majority of the total votes of members
outstanding at the close of business on the next business day prior
to the date that the requisite written consents have been filed with
the association.



5102.  (a) "Association" or "savings association" means a mutual or
stock savings association, savings and loan association or savings
bank subject to the provisions of this division, but excluding a
federal association.
   (b) "Federal association" means a savings and loan association or
federal savings bank that is chartered by the Office of Thrift
Supervision under Section 5 of the Home Owners' Loan Act of 1933 (12
U.S.C. Sec. 1464), as amended.



5103.  "Certificate of authority" means:
   (a) A certificate of authority to transact the business of an
association, which is issued by the commissioner pursuant to this
division.
   (b) An uncanceled annual license issued to an association under
prior law which is valid on the effective date of this division.



5103.5.  "Commercial paper" means any note, draft, or bill of
exchange which arises out of a current transaction or the proceeds of
which have been or are to be used for current transactions, and
which has a maturity at the time of issuance of not exceeding nine
months, exclusive of days of grace, or any renewal thereof the
maturity of which is likewise limited.



5104.  "Commissioner" means the Commissioner of Financial
Institutions.


5105.  "Community" means a centralized area or locality in which a
body of inhabitants is gathered in one group having common
residential, social, or business interests. The term does not
necessarily mean a municipal corporation or other political
subdivision. A community need not be limited by lines and boundaries.
A city, village, town, or other governmental unit, either
incorporated or unincorporated, may constitute one community, but a
large, populous area under one or more forms of government may be
composed of several communities.



5105.5.  "Consumer loan" means a loan for personal, family, or
household purposes, and loans reasonably incident thereto, and may be
made as either open-end or closed-end consumer credit, but does not
include credit extended in connection with credit cards or bona fide
overdraft loans.



5105.8.  "Corporate debt security" means a marketable obligation,
evidencing the indebtedness of any corporation in the form of a bond,
note, or debenture, or both note and debenture, which is commonly
regarded as a debt security and is not predominantly speculative in
nature. A security is marketable if it may be sold with reasonable
promptness at a price which corresponds reasonably to its fair value.




5106.  "Department" means the Department of Financial Institutions.



5107.  "Financial institution" means a thrift institution,
commercial bank, or trust company.



5108.  "Impaired condition" means a condition in which the assets of
an association in the aggregate do not have a value, as determined
in accordance with generally accepted accounting principles, equal to
or greater than the aggregate amount of liabilities of the
association to its creditors, including the holders of its savings
accounts and all other persons who are creditors.



5109.  "Mutual association" means an association for which the
articles of incorporation do not authorize the issuance of capital
stock.


5110.  "Member" means a person holding a savings account of a mutual
association. A joint and survivorship or other multiple owner
constitutes a single membership.



5111.  "Mutual capital certificate" means a certificate evidencing
an investment in a mutual association and issued pursuant to
provisions of this division.


5112.  "Net worth certificate" means a certificate issued by an
association in accordance with Section 13i of the Federal Deposit
Insurance Act, as amended (12 U.S.C., Sec. 1823i) and regulations
promulgated thereunder by the Federal Deposit Insurance Corporation.




5113.  "Person" means any individual, domestic, or foreign
corporation, entity, voting trust, business trust, partnership,
limited liability company, association, syndicate, organized group of
persons, or similar organization, group or entity, whether
incorporated or not.



5114.  "Primarily residential property" means real estate on which
there is located, or will be located pursuant to a real estate loan,
any of the following:
   (a) A structure or structures designed or used primarily for
residential rather than nonresidential purposes and consisting of
more than one dwelling unit.
   (b) A structure or structures designed or used primarily for
residential rather than nonresidential purposes for students,
residents, and persons under the care of, or the employees or members
of the staff of, an educational, health, or welfare institution or
facility.
   (c) A structure or structures that are used in part for
residential purposes for not more than one family and in part for
business purposes if the residential use of the structure or
structures is substantial and permanent and not merely transitory.



5114.5.  "Residential real estate" means any improved real property
that is used or intended to be used as a residence and contains not
more than four dwelling units.



5115.  "Real estate loan" means a loan or other obligation secured
by a lien on real estate, if:
   (a) The security property is real estate as defined pursuant to
Section 658 of the Civil Code.
   (b) The security interest of the association may be enforced as a
real estate mortgage, deed of trust, or its equivalent.
   (c) The security property is capable of separate appraisal.
   (d) The association relies substantially upon the real estate as
primary security for the loan.
   (e) With regard to security property which is a leasehold or other
interest for a period of years, the term of interest extends, or is
subject to extension or renewal at the option of the association, for
a term of at least five years following maturity of the loan.



5116.  "Savings account" means that part of the savings liability of
an association that is credited to the holder of the account. A
savings account may be referred to as a deposit. For the purposes of
Sections 6661, 6662, and 6663 and Article 4 (commencing with Section
6725) through Article 10 (commencing with Section 7000), inclusive,
of Chapter 5 of this division, the term "savings account" includes
shares, demand accounts, savings deposits and other savings accounts
of federal associations.



5117.  "Savings bank" means a savings bank organized under this
division.


5117.5.  "Savings institution" means a financial institution as
defined in Section 5102.



5118.  "Savings liability" means the aggregate amount of savings
accounts of depositors, including interest credited to the accounts,
less redemptions and withdrawals.



5119.  "Service corporation" means a corporation, other than a
wholly owned subsidiary referred to in Section 7300 or a wholly owned
subsidiary doing business as a finance subsidiary in accordance with
the requirements of 12 C.F.R. 563.132, in which at least 80 percent
of the shares of stock having voting power are owned by one or more
associations or federal associations. As used in this section "voting
power" shall have the same meaning as defined in Section 194.5 of
the Corporations Code.



5120.  "Statutory net worth" or "net worth" means the sum of the
following:
   (a) Issued and outstanding capital stock.
   (b) Issued and outstanding capital certificates.
   (c) Paid-in surplus.
   (d) Retained earnings.
   (e) Pledged savings accounts of a mutual association with the
approval of the commissioner.
   (f) General reserves and other amounts as the commissioner
prescribes.


5121.  "Stock association" means an association for which the
articles of incorporation authorize the issuance of capital stock.



5122.  "Stockholder" means the holder of one or more shares of any
class of capital stock of a capital stock association which is
organized and operating pursuant to the provisions of this division.



5123.  "Thrift institution" means an association, a cooperative
bank, a homestead association, a building and loan association, a
federal association, a federal savings bank, a state or federal
credit union, an industrial loan company, and a supervised thrift and
residential financing institution of a substantially similar nature.




5124.  "Withdrawal value" means the amount credited to a savings
account less lawful deductions, as shown by the records of the
association.

Categories