Section 58-11-10 - Formation of credit union.
58-11-10. Formation of credit union.
A. Any seven or more residents of this state of legal age that share the common bond referred to in Section 58-11-21 NMSA 1978 may organize a credit union and become charter members thereof by complying with this section.
B. The organizers shall prepare, adopt and execute in triplicate articles of organization and agree to the terms thereof. The articles shall state:
(1) the credit union's name and the location of the proposed credit union's principal place of business;
(2) that the existence of the credit union shall be perpetual;
(3) the names and addresses of the organizers; and
(4) that each member shall subscribe to one share of the credit union.
C. The organizers shall prepare, adopt and execute in duplicate bylaws consistent with the Credit Union Act [58-11-1 NMSA 1978] for the general governance of the credit union.
D. The organizers shall select at least five persons who are eligible for membership and who agree to become members and serve on the board of directors and at least three other persons who are eligible for membership and who agree to become members and serve on the supervisory committee. The persons selected to serve on the board of directors and supervisory committee shall execute an agreement to serve in these capacities until the first annual meeting or until the election of their respective successors, whichever is later.
E. The organizers shall forward the triplicate articles of organization, the duplicate bylaws and the agreements to serve to the director who shall act upon the application within sixty days. The director shall issue a certificate of approval if the articles and bylaws are in conformity with applicable provisions of the Credit Union Act and he is satisfied that:
(1) the characteristics of the common bond set forth in the proposed bylaws are favorable to the economic viability of the proposed credit union;
(2) the reputation and character of the initial board of directors and supervisory committee provide assurance that the credit union's affairs will be properly administered; and
(3) the share and deposit insurance requirements of Section 58-11-48 NMSA 1978 will be met.
F. The following provisions apply to issuance and denial of certificate:
(1) if the director issues a certificate of approval, he shall return a copy of the bylaws to the organizers and, upon payment of the required fee, file the triplicate originals of the articles of organization with the state corporation commission [public regulation commission]; and
(2) if the director denies a certificate of approval, he shall notify the organizers and set forth his reasons for the denial. The organizers may appeal his decision to the court of appeals within thirty days after receipt of the notice of denial.
G. The organizers shall not transact any credit union business until a certificate of approval has been received and shall accept no payments on shares or deposit until insurance of accounts has been obtained as provided by Section 58-11-48 NMSA 1978.
H. Any credit union, the articles of organization of which have been approved by the director, shall commence business within six months after satisfactory proof has been filed with the director showing that insurance of share and deposit accounts has been obtained. Upon showing of good cause for failure to commence business within this time, the director may grant a reasonable extension to overcome the reason for delay. Failure to commence business as required in this section or failure to obtain insurance of accounts within one year from the date of approval of the articles of organization constitutes grounds for forfeiture of the credit union's articles of organization.