CHAPTER 33. CHARTER CONVERSION OF A MUTUAL SAVINGS BANK INTO A CREDIT UNION
IC 28-1-33
Chapter 33. Charter Conversion of a Mutual Savings Bank Into a
Credit Union
IC 28-1-33-1
"Charter conversion"
Sec. 1. As used in this chapter, "charter conversion" means the
conversion of a mutual savings bank into a credit union under this
chapter.
As added by P.L.1-2006, SEC.492.
IC 28-1-33-2
"Conversion plan"
Sec. 2. As used in this chapter, "conversion plan" refers to a plan
of charter conversion prepared under this chapter.
As added by P.L.1-2006, SEC.492.
IC 28-1-33-3
"Credit union"
Sec. 3. As used in this chapter, "credit union" has the meaning set
forth in IC 28-7-1-0.5(3).
As added by P.L.1-2006, SEC.492.
IC 28-1-33-4
"Effective time of the charter conversion"
Sec. 4. As used in this chapter, "effective time of the charter
conversion" means:
(1) the date on which articles of conversion are filed with the
secretary of state; or
(2) the date designated in the articles of conversion as the
effective time of the charter conversion.
As added by P.L.1-2006, SEC.492.
IC 28-1-33-5
"Mutual savings bank"
Sec. 5. As used in this chapter, "mutual savings bank" has the
meaning set forth in IC 28-6.1-2-5.
As added by P.L.1-2006, SEC.492.
IC 28-1-33-6
"Voting parties"
Sec. 6. As used in this chapter, "voting parties" means the:
(1) depositors; and
(2) borrowers;
of a mutual savings bank.
As added by P.L.1-2006, SEC.492.
IC 28-1-33-7
Conversion authority
Sec. 7. With the approval of the department, a mutual savings
bank may convert its charter under this chapter.
As added by P.L.1-2006, SEC.492.
IC 28-1-33-8
Requirements and procedures
Sec. 8. (a) Except as provided in section 8.1 of this chapter for the
conversion of a mutual savings bank into a federally chartered credit
union, the department shall prescribe procedures for charter
conversions under this chapter.
(b) The procedures prescribed by the department must include the
following:
(1) The mutual savings bank must prepare and submit to the
department a conversion plan that provides the terms and
conditions required by the department for a charter conversion
under this chapter.
(2) The conversion plan must be adopted by not less than a
majority of the board of directors of the mutual savings bank.
(3) Upon approval of a plan of charter conversion by the board
of directors of the savings bank, the conversion plan and a
certified copy of the resolution of the board of directors
approving the conversion plan must be submitted to the
department for approval.
(4) The conversion plan must be conditioned upon the approval
of not less than a majority of the total number of votes eligible
to be cast at a regular or special meeting of the voting parties.
The director of the department must approve the method used
to notify the voting parties of the meeting held to consider the
conversion plan. The director of the department may require the
converting mutual savings bank to provide the voting parties
with information regarding the conversion plan.
(5) The mutual savings bank must provide to the department the
additional relevant information requested by the department in
connection with the conversion plan.
As added by P.L.1-2006, SEC.492. Amended by P.L.213-2007,
SEC.53; P.L.217-2007, SEC.51.
IC 28-1-33-8.1
Conversion to federally chartered credit union; requirements; date
of charter conversion
Sec. 8.1. (a) A mutual savings bank may convert into a federally
chartered credit union by complying with the following
requirements:
(1) The mutual savings bank must prepare a conversion plan
that provides the terms and conditions for the conversion of the
mutual savings bank into a federal credit union.
(2) The conversion plan must be adopted by not less than a
majority of the board of directors of the mutual savings bank.
(3) Unless the articles of incorporation require a greater or
lesser vote, the conversion plan must be approved by not less
than a majority of the total number of votes eligible to be cast
at a regular or special meeting of the voting parties.
(4) If the conversion plan is approved by the voting parties
under subdivision (3), the mutual savings bank shall, not later
than ninety (90) days after the plan is approved under
subdivision (3), take all necessary actions to effect the charter
conversion.
(5) Not later than ten (10) days after receipt of the federal
charter, the credit union resulting from the charter conversion
shall:
(A) file a copy of the federal charter with the department;
and
(B) notify the secretary of state that the conversion is
complete.
(b) Notwithstanding section 4 of this chapter, the converted
federal credit union ceases to be a savings bank upon the issuance of
the federal charter, unless the federal charter provides for a different
effective date for the charter conversion.
As added by P.L.213-2007, SEC.54; P.L.217-2007, SEC.52.
IC 28-1-33-9
Voting party rights
Sec. 9. The voting parties of a mutual savings bank have the
voting rights set forth in IC 28-13-6-2 with respect to a charter
conversion of the mutual savings bank under this chapter.
As added by P.L.1-2006, SEC.492.
IC 28-1-33-10
Department approval
Sec. 10. (a) The department may approve or disapprove the
conversion plan filed under section 8 of this chapter.
(b) The department is not required to hold a hearing on the
conversion plan.
(c) Solicitation of the votes of voting parties may occur before the
mutual savings bank receives approval of the department if the
director of the department has reviewed the proxy solicitation
material and has notified the mutual savings bank in writing that the
department does not object to use of the material.
As added by P.L.1-2006, SEC.492.
IC 28-1-33-11
Requirements for approval
Sec. 11. The department may not approve the conversion plan
unless the department finds, after appropriate investigation or
examination, all of the following:
(1) The resulting credit union will operate in a safe, sound, and
prudent manner.
(2) The proposed charter conversion will not result in a credit
union that has inadequate capital, unsatisfactory management,
or poor earnings prospects.
(3) The management or other principals of the mutual savings
bank are qualified by character and financial responsibility to
control and operate the proposed credit union in a legal and
proper manner.
(4) The interests of the depositors, the creditors, and the public
generally will not be jeopardized by the proposed charter
conversion.
(5) The proposed membership of the resulting credit union will
comply with the membership requirements of IC 28-7-1-10.
As added by P.L.1-2006, SEC.492.
IC 28-1-33-12
Rights, privileges, obligations, and liabilities
Sec. 12. At the effective time of a charter conversion under this
chapter, the resulting credit union:
(1) possesses all of the rights, privileges, immunities, and
powers of a credit union;
(2) unless otherwise provided in this chapter, is subject to all of
the statutes, regulations, duties, restrictions, obligations, and
liabilities of a credit union;
(3) succeeds by operation of law to all rights and property of the
converting mutual savings bank;
(4) is subject to all debts, obligations, and liabilities of the
converting mutual savings bank as if the credit union had
incurred the debts, obligations, and liabilities; and
(5) may retain the borrowers and depositors of the converting
mutual savings bank as members of the credit union.
As added by P.L.1-2006, SEC.492.
IC 28-1-33-13
Winding up activities
Sec. 13. The department may authorize the credit union resulting
from a charter conversion under this chapter to do the following:
(1) Wind up any activities that the mutual savings bank legally
engaged in at the effective time of the charter conversion but
that otherwise are not permitted to credit unions.
(2) Retain for a transitional period any assets that the mutual
savings bank legally held at the effective time of the charter
conversion that otherwise may not be held by credit unions.
The terms and conditions of the winding up of activities under
subdivision (1) and the retention of assets under subdivision (2) are
subject to the discretion of the department. However, the transitional
period during which activities may be carried out under subdivision
(1) or assets may be retained under subdivision (2) may not exceed
ten (10) years after the effective time of the charter conversion.
As added by P.L.1-2006, SEC.492.
IC 28-1-33-14
Branches
Sec. 14. A credit union created by charter conversion may retain
all branches lawfully established.
As added by P.L.1-2006, SEC.492.
IC 28-1-33-15
Filing articles of charter conversion
Sec. 15. (a) To effect a charter conversion, the converting mutual
savings bank must file with the secretary of state articles of charter
conversion showing the approval of the director of the department.
(b) The converting mutual savings bank shall record copies of the
articles of charter conversion with the county recorder of the county
where the principal office of the credit union will be located.
(c) The articles of charter conversion constitute articles of
incorporation of the resulting credit union and must set forth the
elements required in IC 28-7-1-1(b).
As added by P.L.1-2006, SEC.492.
IC 28-1-33-16
Subject to credit union statutes and rules
Sec. 16. Upon the effective time of a charter conversion, the
converted credit union is subject to all statutes and rules applicable
to credit unions.
As added by P.L.1-2006, SEC.492.
IC 28-1-33-17
Rulemaking authority
Sec. 17. The department may adopt rules under IC 4-22-2 or
policies to implement this chapter.
As added by P.L.1-2006, SEC.492.