Bill S3442-2015

Provides criteria for membership in credit unions and permits the extension of certain services to nonmembers

Provides criteria for membership in credit unions and permits the extension of certain services to nonmembers.

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  • Feb 9, 2015: REFERRED TO BANKS

Memo

BILL NUMBER:S3442

TITLE OF BILL: An act to amend the banking law, in relation to credit union memberships and general powers

PURPOSE OR GENERAL IDEA OF BILL:

This bill would expand the qualifications for membership into credit unions.

SUMMARY OF SPECIFIC PROVISIONS:

Section 1: Sets forth the qualifications for membership.

Section 2: States that no credit union shall make any member a business loan that would result in the net member business loan balance to any on member exceeding specific amounts.

Section 3: Authorized securities as permissible investments for savings banks.

Section 4: Subject to such regulations as the superintendent may adopt, any credit union, may open and maintain within or without the state in any locality in which its actual potential membership is employed, attending school or residing, one or more stations for the conduct of its business with provisions.

Section 5: Sets for the conditions as established by the board of directors to issue and receive payments on, shares, share drafts, and share certificates.

Section 6: This act shall take effect immediately.

JUSTIFICATION:

State subsidized jobs provide low wages and poor benefits which increases the need for government services. The purpose of this bill is to improve the effectiveness of economic development expenditures. Take pressure off of state social services programs and improve the public health and welfare by ensuring that major state subsidies are used to support at least minimum living standards for working families.

PRIOR LEGISLATIVE HISTORY:

2013-14: S.2912 - Referred to Banks 2011-12: S.1488 - Referred to Banks 2010: S.1931-A/A.260A - Referred to Banks 2007-08: A.2793 - Referred to Banks

FISCAL IMPLICATIONS:

To be determined.

EFFECTIVE DATE:

Immediately.


Text

STATE OF NEW YORK ________________________________________________________________________ 3442 2015-2016 Regular Sessions IN SENATE February 9, 2015 ___________
Introduced by Sens. PARKER, PERKINS -- read twice and ordered printed, and when printed to be committed to the Committee on Banks AN ACT to amend the banking law, in relation to credit union memberships and general powers THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Subdivision 2 of section 451 of the banking law, as amended by chapter 502 of the laws of 2014, is amended to read as follows: 2. The qualifications for membership. [Such qualifications for membership shall be established in accordance with the provisions of section four hundred fifty-one-a of this article, except that such section shall not apply to a corporate credit union.] THE MEMBERSHIP OF A CREDIT UNION SHALL BE DETERMINED BY THE BOARD OF DIRECTORS OF SUCH CREDIT UNION AND SHALL CONSIST OF PERSONS WHO HAVE BEEN DULY ADMITTED MEMBERS. S 2. Subparagraph (i) of paragraph (c) of subdivision 6 of section 454 of the banking law, as added by chapter 660 of the laws of 2004, is amended to read as follows: (i) [No credit union may make any member business loan that would result in a total amount of such loans outstanding at that credit union at any one time equal to more than the lesser of 1.75 times the actual net worth of the credit union, or 1.75 times the minimum net worth required under 12 U.S.C. 1790d(c)(1)(A) for a credit union to be well capitalized.] (A) NO CREDIT UNION SHALL MAKE ANY MEMBER A BUSINESS LOAN THAT WOULD RESULT IN THE NET MEMBER BUSINESS LOAN BALANCE TO ANY ONE MEMBER EXCEEDING THE GREATER OF: (1) TWENTY-FIVE PERCENT OF THE CREDIT UNION'S NET WORTH, OR (2) TWO HUNDRED FIFTY THOUSAND DOLLARS. (B) THE AGGREGATE LIMIT ON A CREDIT UNION'S NET BUSINESS LOAN BALANCES SHALL BE THE GREATER OF: (1) TWENTY-FIVE PERCENT OF THE CREDIT UNION'S TOTAL ASSETS, OR
(2) THE LIMIT ESTABLISHED FOR FEDERAL CREDIT UNIONS. S 3. Subparagraph (i) of paragraph (a) of subdivision 18 of section 454 of the banking law, as amended by chapter 502 of the laws of 2014, is amended to read as follows: (i) Those securities authorized as permissible investments for savings banks by subdivisions one, two, three, four, twelve, SUBPARAGRAPH FIVE OF PARAGRAPH (A) OF SUBDIVISION NINE, paragraphs (a) and (b) of subdivi- sion twelve-a, [and] subdivisions fifteen, seventeen, PARAGRAPH (A) OF SUBDIVISION TWENTY, SUBPARAGRAPHS ONE AND ONE-A OF PARAGRAPH (A) OF SUBDIVISION TWENTY-ONE, SUBDIVISIONS TWENTY-FOUR-D, twenty-seven [and], TWENTY-EIGHT, twenty-eight-a, TWENTY-NINE AND THIRTY of section two hundred thirty-five of this chapter and such other investments as the superintendent deems permissible. S 4. Subdivision 2 of section 461 of the banking law, as added by chapter 608 of the laws of 1996, is amended to read as follows: 2. Subject to such regulations as the superintendent may adopt, any credit union, may open and maintain within or without the state, in any locality in which [a substantial portion of] its actual potential membership is employed, ATTENDING SCHOOL or residing, one or more stations for the conduct of its business [provided that before any such station or stations shall be opened or maintained or removed to a new location: (a) Its board of directors shall submit to the superintendent a writ- ten application setting forth the reasons therefor and the proposed location of such station or stations. (b) The superintendent shall have given his written approval thereto]. S 5. Subdivision 1 of section 454 of the banking law, as amended by chapter 679 of the laws of 2003, is amended to read as follows: 1. To issue and receive payments on, shares, share drafts, and share certificates, subject to such terms, rates, and conditions as are estab- lished by its board of directors, from: (A) its members; (B) NONMEMBERS WHO OR WHICH MAY BE NATURAL PERSONS, CORPORATIONS, LIMITED LIABILITY COMPANIES, PARTNERSHIPS OR OTHER LEGAL ENTITIES; (C) AN OFFICER, EMPLOYEE OR AGENT OF THOSE NONMEMBER UNITS OF THE FEDERAL, STATE, INDIAN TRIBAL OR LOCAL GOVERNMENTS AND POLITICAL SUBDI- VISIONS; and (D) from other credit unions, both state and federally chartered. A member may designate any person or persons to own shares or share certificates with him or her in joint tenancy with the right of survi- vorship, but no joint tenant shall be permitted to vote, obtain loans, or hold office, unless he or she is within the field of membership and is a qualified member. S 6. This act shall take effect immediately provided, that the amend- ments to subdivision 2 of section 451 of the banking law made by section one of this act shall take effect on the same date and in the same manner as section 1 of chapter 502 of the laws of 2014; and provided further that the amendments to subparagraph (i) of paragraph (c) of subdivision 18 of section 454 of the banking law made by section three of this act shall take effect on the same date and in the same manner as section 3 of chapter 502 of the laws of 2014.

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