Board of directors; committees; officers

(a) At the first annual meeting, the members shall elect from among their number a board of directors of no less than five nor more than 25 and at each annual meeting thereafter shall elect successors to the 357 7-1-655 members of the board of directors whose terms of office expire at such annual meeting. (b) Except as this Code section permits the bylaws of a credit union to provide otherwise, members of the board of directors elected at the first annual meeting shall serve until the next annual meeting. A credit union may in its bylaws provide for staggered elections for members of the board of directors; but in that event the bylaws shall provide that as nearly as possible one-third of the board shall be elected at each annual meeting. (c) At the organizational meeting and at its first meeting after each annual meeting of the members, the board of directors shall appoint an audit committee, credit committee, chairperson, and secretary. In addition, the board of directors may appoint other committees or executive officers consistent with the bylaws as the board deems desirable. No member of the audit committee may be an employee of the credit union. (d) The chairperson of the credit and audit committees shall be appointed by the board from among its number. Both the credit and audit committees shall be accountable to the board and members of such committees may be removed by the board. (e) Directors shall serve until their successors are chosen or have duly qualified. A director elected or appointed to fill an unexpired term shall be elected or appointed for the balance of that term. (f) All members of the board of directors and committee members shall be sworn to perform faithfully the duties of their several offices in accordance with this chapter and the bylaws or as otherwise lawfully established. The oaths shall be subscribed in writing and a copy thereof shall be retained in the minutes of the meetings of the board. The oaths shall not modify in any manner the legal duties of or the standard of care for members of the board of directors and committee members in the exercise of such duties. (g) The entire board of directors or an individual director may be removed from office without cause by the vote of a quorum of members at a properly called meeting. (h) The board may remove a director from office if: (1) The director is adjudicated an incompetent by a court or is convicted of a felony; (2) The director does not, within 60 days of his or her election or such longer time as may be specified in the bylaws, accept the office in writing or by attendance at a meeting and fulfill other requirements for holding the office; 358 7-1-655 (3) The director fails to attend regular meetings of the board for six successive meetings without having been excused by the board; (4) The director was an employee or duly elected officer of the credit union and was discharged or resigned at the request of the board for reasons relating to performance of duties as an employee or officer of the credit union; or (5) For any reason set forth in the bylaws of the credit union. (i) The board of directors, by a two-thirds’ vote of a quorum of the board, may suspend any member of the credit union’s board of directors, for cause, until the next membership meeting, which shall be held not less than seven nor more than 60 days after such suspension. The suspended person will be notified of the details of his or her suspension, and shall have the right to request a meeting with the board to reconsider his or her suspension prior to the membership meeting. Any suspended member of the board of directors may be removed by a majority vote of a quorum of members at a properly called meeting. At such meeting of the membership, the suspended person shall have the right to make a presentation to the members and the suspension shall be acted upon by the members at such meeting and the person shall be removed from, or restored to, the board. (j) Vacancies in the board of directors, whether caused by removal or otherwise and including vacancies resulting from an increase in the number of directors, may be filled by the remaining members of the board, even though less than a quorum. (k) The credit union shall immediately notify the department upon a change in president or chief executive officer. (l) Each credit union shall keep minutes of the meetings of its members, board of directors, and committees of directors. History. Ga. L. 1925, p. 165, § 12; Code 1933, § 25-112; Ga. L. 1962, p. 74, § 1; Code 1933, § 41A-3106, enacted by Ga. L. 1974, p. 705, § 1; Ga. L. 1976, p. 1681, § 3; Ga. L. 1981, p. 1244, § 7; Ga. L. 1989, p. 1211, § 13; Ga. L. 2011, p. 518, § 4/HB 239; Ga. L. 2015, p. 344, § 21/HB 184; Ga. L. 2016, p. 390, § 3-3/HB 811; Ga. L. 2018, p. 214, § 14/HB 780; Ga. L. 2019, p. 828, § 23/HB 185; Ga. L. 2020, p. 493, § 7/SB 429; Ga. L. 2022, p. 220, § 26/HB 891; Ga. L. 2023, p. 651, § 12/HB 55, effective July 1, 2023; Ga. L. 2024, p. 354, § 1-14/HB 876, effective July 1, 2024. Amendments. The 2022 amendment, effective July 1, 2022, deleted “president,” following “chairperson,” in the first sentence in subsection (c). The 2023 amendment, effective July 1, 2023, rewrote the last sentence of subsection (c), which read: “No member of the audit committee may serve as a member of the credit committee or as an officer, unless the board of directors functions as the credit committee as provided for in subsection (f) of Code Section 7-1-658.” The 2024 amendment, effective July 1, 2024, in subsection (b), deleted “and 359 until their successors are elected and qualified” from the end of the first sentence; in subsection (c), substituted “chairperson, and secretary. In addition, the board of directors may appoint other committees or executive officers” for “chairperson, secretary, and such other officers”; rewrote subsection (e); in subsection (f), substituted “board of directors” for “board and all officers” near the beginning in the first sentence and substituted “of the board of directors and committee members” for “and officers” in the third sentence; and added subsection (l). 7-1-656 Editor’s notes. Ga. L. 2018, p. 214, § 26(b)/HB 780, not codified by the General Assembly, provides that: “It is not the intent of the General Assembly to affect the law applicable to litigation pending as of March 9, 2018.” Ga. L. 2023, p. 651, § 12/HB 55, which amended this Code section, referred to “paragraph (c)” in the directory language of the Act and should have referred to “subsection (c)”. 7-1-656. Directors; duties; meetings; quorum; voting; prohibited activities. (a) The board of directors shall be responsible for the affairs, funds, and records of the credit union and shall meet as often as necessary. The board of directors shall meet at least once during ten different months of each calendar year unless an alternative schedule is approved in writing by the department, but in no event shall the board meet less frequently than once in each calendar quarter. Unless the bylaws specifically reserve any or all of the duties to the members, it shall be the special duty of the directors: (1) To act upon all applications for membership or approve the actions of an officer without loan granting authority, designated by the board of directors to approve applications for membership; (2) To determine from time to time rates of interest and dividends which shall be allowed on deposits, loans, and income consistent with this article and other applicable laws and to authorize any interest refunds on such classes of loans and under such conditions as the board prescribes; (3) To fix the amount of the fidelity bond which shall be required of all directors, officers, employees, agents, or members having custody of funds, properties, or records; provided, however, that the amount of such fidelity bond shall not be less than such minimum requirements as shall be prescribed by regulation of the department and shall be in such form as may from time to time be approved by the department; (4) To fix within the restrictions imposed by statute the maximum amount of deposits which may be made by and the maximum amount that may be loaned to any one member; (5) To fill vacancies on the board of directors, credit committee, and audit committee until the election and qualification of a successor; 360 7-1-656 (6) To have charge of the investment of funds of the credit union other than loans to members within the restrictions imposed by statute or delegate investment authority to a qualified committee or officer as designated by the board of directors; (7) To appoint any committees deemed necessary; and (8) To perform such other duties as the members may from time to time authorize. (b) Unless otherwise provided in the articles or bylaws of a credit union: (1) A majority of all directors shall constitute a quorum for the transaction of business and actions of a majority of those present at a meeting at which a quorum is present shall be deemed as actions of the board of directors; (2) The board of directors may designate three or more of its number to constitute a credit committee, audit committee, or other committees which, to the extent provided in a resolution, shall have and exercise the authority of the board of directors with regard to the business of a credit union; and (3) Any action authorized to be taken at a meeting of the board of directors or a credit, audit, or other committee may be taken without a meeting if the action is set forth in writing and approved and signed by all directors or all members of the credit, audit, or other committee entitled to vote with respect to the underlying subject matter. (c) No director, officer, or committee member of a credit union shall: (1) Receive anything of value for procuring or attempting to procure any loan from or investment by such credit union; (2) Purchase, or directly or indirectly be interested in purchasing, from the credit union a promissory note or other evidence of indebtedness issued by the credit union for less than face value; or (3) Purchase or sell any other asset to the credit union except: (A) Upon terms not less than favorable to the credit union than those offered other persons or corporations; and (B) With prior approval of the board of directors or a committee thereof authorized to act for the board, unless the transaction is made in the regular course of business. (d) No director shall be eligible to vote concerning any purchase or sale when such director is or would be a party to the transaction. (e) The provisions of Code Section 7-1-490 relative to the responsibilities of directors and officers and the delegation of 361 7-1-657 investment decisions shall be applicable to the duties of directors, credit and audit committee members, and officers of credit unions. (f) The board of directors may appoint an individual as an honorary director or director emeritus or member of an advisory board. An individual so appointed may be compensated but shall not vote at any meeting of the board of directors or be counted in determining a quorum and shall not have any responsibility for or be subject to any liability imposed upon a director or otherwise be deemed a director. (g) The board of directors may determine that a meeting of such board will be held, in whole or in part, by any means of communication by which all directors participating may simultaneously hear each other during the meeting. A director participating in a meeting by such means shall be considered to be present in person at the meeting. History. Ga. L. 1925, p. 165, § 13; Code 1933, § 25-113; Ga. L. 1956, p. 742, § 2; Ga. L. 1968, p. 465, § 6; Code 1933, § 41A-3107, enacted by Ga. L. 1974, p. 705, § 1; Ga. L. 1975, p. 445, § 32; Ga. L. 1981, p. 1244, § 8; Ga. L. 1989, p. 1211, § 14; Ga. L. 2002, p. 1220, § 6; Ga. L. 2005, p. 826, § 19/SB 82; Ga. L. 2015, p. 344, § 22/HB 184; Ga. L. 2018, p. 214, § 15/HB 780; Ga. L. 2019, p. 828, § 24/HB 185; Ga. L. 2020, p. 320, § 10/HB 781; Ga. L. 2021, p. 323, § 32/HB 111; Ga. L. 2022, p. 220, § 27/HB 891; Ga. L. 2024, p. 354, § 1-15/HB 876, effective July 1, 2024. Amendments. The 2022 amendment, effective July 1, 2022, rewrote the former first sentence in subsection (a), which read: “The board of directors shall be responsible for the affairs, funds, and records of the credit union and shall meet as often as necessary, but at least once during ten different months of each calendar year.” The 2024 amendment, effective July 1, 2024, substituted “deposits, loans, and income” for “deposits and charged on loans” in paragraph (a)(2) and inserted “directors,” near the beginning of paragraph (a)(3). Editor’s notes. Ga. L. 2018, p. 214, § 26(b)/HB 780, not codified by the General Assembly, provides that: “It is not the intent of the General Assembly to affect the law applicable to litigation pending as of March 9, 2018.”