Title FI, Finance Code

Sec. 122.005. PROCEDURE FOR CERTAIN APPROVALS. (a) This section applies to a request for approval by the commissioner of: (1) an application for incorporation under this subchapter; (2) a request for approval of an amendment to a credit union's articles of incorporation under Sec…

Sec. 122.006. DECISION ON APPLICATION TO INCORPORATE; ISSUANCE OF CERTIFICATE. (a) The commissioner shall approve an application to incorporate a credit union if the commissioner determines: (1) that the incorporators have complied with this chapter and rules adopted under this c…

Sec. 122.007. APPEAL TO COMMISSION. (a) The commission by rule shall provide for appeal of the commissioner's order by an incorporator or other aggrieved person. (b) The commissioner's order may be appealed to the commission not later than the 60th day after the date of the order…

Sec. 122.008. EFFECT OF ISSUANCE OF CERTIFICATE OF INCORPORATION. (a) A credit union's existence begins when the commissioner issues the certificate of incorporation. (b) The certificate of incorporation is conclusive evidence that the incorporators have complied with this subtit…

Sec. 122.009. REQUIREMENTS FOR COMMENCING BUSINESS. (a) A credit union may not transact business or incur debt that is not incidental to its organization or to obtaining a subscription to or payment for its shares or deposits before it: (1) has received paid-in shares or deposits…

Sec. 122.010. DEADLINE FOR COMMENCING BUSINESS. (a) A credit union shall begin business before six months after the date of the order approving the credit union's application. (b) On request and for good cause shown, the commissioner may grant a credit union that has not begun bu…

Sec. 122.011. AMENDMENT OF ARTICLES OF INCORPORATION OR BYLAWS. (a) The board may amend the articles of incorporation or bylaws by a two-thirds vote of the directors present at a meeting at which a quorum is present. The board shall submit amendments to the commissioner. (b) Unle…

Sec. 122.012. PLACE OF BUSINESS. (a) A credit union shall maintain on file with the department a statement specifying the street and post office address of the credit union's principal place of business. (b) A credit union shall provide the commissioner with written notice not la…

Sec. 122.013. FOREIGN CREDIT UNIONS. (a) A foreign credit union may do business in this state if it is organized in a state or country that allows any credit union organized under this subtitle to do business in that state or country. (b) A foreign credit union doing business in …

Sec. 122.0131. TEMPORARY FOREIGN CREDIT UNION OFFICE. If a state contiguous to this state experiences an emergency, on a request by that state's credit union regulatory agency, the commissioner may authorize one or more credit unions located in that state to open temporary office…

Sec. 122.014. UNDERSERVED-AREA CREDIT UNION. (a) In this section, "secondary capital account" means a nontransactional account in an amount greater than $100,000 as established by the commission that is: (1) owned by a person other than an individual; and (2) subordinated to othe…

Sec. 122.051. MEMBERSHIP. (a) A person may be a member of a credit union only if the person is an incorporator or other person who: (1) shares a definable community of interest, in accordance with the credit union's articles of incorporation or bylaws, including a community of in…

Sec. 122.052. MEETINGS OF MEMBERS; VOTING. (a) Members of a credit union shall hold an annual or special meeting at the time and place and in the manner provided by the bylaws. (b) In determining a question requiring action by the members, each member may cast only one vote, rega…

Sec. 122.053. BOARD OF DIRECTORS; TERMS AND DUTIES. (a) A board of at least five members shall direct the business and affairs of a credit union. (b) The membership of the credit union shall elect the board at an annual membership meeting, from the membership, and in the manner p…

Sec. 122.054. QUALIFICATION OF DIRECTORS. (a) The commission by rule shall establish qualifications for a director. The rules must provide that a person may not serve as director if the person: (1) has been convicted of a criminal offense involving dishonesty or breach of trust; …

Sec. 122.055. VACANCIES; REMOVAL. (a) The office of a director becomes vacant if the director dies, resigns, is removed, has been absent from more meetings than the total number of absences permitted by commission rule, or does not possess or maintain the qualifications required …

Sec. 122.056. HONORARY OR ADVISORY DIRECTORS. (a) The board may appoint not more than six individuals to serve at the board's pleasure as honorary or advisory directors to advise and consult with the board and otherwise aid the board in carrying out the board's duties and respons…

Sec. 122.057. OFFICERS; EXECUTIVE COMMITTEE. (a) At the annual organizational meeting, the board shall elect from its membership a chairman, vice chairman, treasurer, and secretary. The offices of treasurer and secretary may be held by the same individual. (b) An officer elected …

Sec. 122.058. CHIEF EXECUTIVE OFFICER. (a) The board may employ, elect, or appoint a president, who is the chief executive officer in charge of operations. (b) The president may be a board member but may not be chairman, vice chairman, or secretary of the credit union. The presid…

Sec. 122.059. DELEGATION OF MANAGEMENT AND LOAN APPROVAL AUTHORITY. (a) Without written approval of the commissioner, a credit union may not: (1) contract with an individual who is not an officer, director, or employee of the credit union or with an organization for the provision…

Sec. 122.060. CERTIFICATE OF ELECTION. (a) A credit union shall submit to the commissioner, in a form approved by the department, a certificate of election that provides the name and address of each officer, director, and committee member elected or appointed. The certificate mus…

Sec. 122.061. CONFLICTS OF INTEREST. (a) While serving as a director, honorary director, advisory director, committee member, officer, or employee of a credit union, a person may not: (1) participate, directly or indirectly, in the deliberation on or determination of a question a…

Sec. 122.062. COMPENSATION. A person may not receive compensation for serving as a director, honorary director, advisory director, or committee member of a credit union, except that the person may be: (1) provided with reasonable health, life, accident, liability, or similar insu…

Sec. 122.063. BOND. The board shall purchase from a surety company authorized to do business in this state a blanket surety or security bond covering each director, honorary director, advisory director, officer, employee, member of an official committee, attorney, or other agent …

Sec. 122.064. INDEMNIFICATION. A credit union may elect to indemnify a director, officer, employee, or agent of the credit union and to purchase insurance as if the credit union were an "enterprise" as defined by Section 8.001, Business Organizations Code, under and subject to th…

Sec. 122.101. CALL REPORTS. (a) A credit union shall prepare a quarterly call report, in a manner approved by the department, that states the credit union's financial condition. The commissioner may require a credit union to file additional financial reports. (b) The credit union…

Sec. 122.102. FINANCIAL REPORTING; AUDITS. (a) A credit union shall use the financial reporting forms and observe the accounting principles prescribed by the commission. (b) The board shall: (1) make a comprehensive annual audit of the credit union's books and affairs, in accorda…

Sec. 122.103. EQUITY CAPITAL. A credit union's equity capital consists of: (1) retained earnings; (2) appropriated retained earnings, including net worth and other reserves; (3) undivided earnings; and (4) other forms of capital in accordance with generally accepted accounting pr…

Sec. 122.104. NET WORTH RESERVE ALLOCATIONS. (a) The commission by rule shall require a credit union to contribute to and maintain net worth reserves necessary to protect the interests of its members. The rule may: (1) prescribe the purposes for which the net worth reserves may b…

Sec. 122.105. MEMBERSHIP SHARE REDUCTION. A credit union may order a reduction in the membership shares of each of its shareholders if: (1) the credit union's losses resulting from a depreciation in value of its loans or investments or otherwise exceed its undivided earnings and …

Sec. 122.106. EXEMPTION FROM CERTAIN TAXES. (a) Except as provided by Subsection (b), a credit union is exempt from a franchise or other license tax. (b) A credit union is not exempt from the franchise tax imposed by Chapter 171, Tax Code, unless the credit union is exempted by t…

Sec. 122.107. NOTICE OF AVAILABILITY OF CERTAIN DOCUMENTS. (a) A credit union regulated under this subtitle and Chapter 15 shall give notice to the credit union's members of the availability on request of a member of documents related to the credit union's finances and management…

Sec. 122.151. AUTHORITY TO MERGE OR CONSOLIDATE. (a) A credit union may merge or consolidate with another credit union, under the other credit union's existing articles of incorporation or otherwise, if: (1) the merger or consolidation is in accordance with commission rules and a…

Sec. 122.152. APPLICATION TO MERGE OR CONSOLIDATE. (a) After agreement by the directors and approval by the members, if applicable, of each credit union or federal credit union, the chairman and secretary of each credit union or federal credit union shall execute a certificate of…

Sec. 122.153. DECISION BY COMMISSIONER; APPEAL. (a) Subject to Subsection (b), on approving the merger or consolidation, the commissioner shall return the certificates and plan to the merging or consolidating credit unions. (b) The commissioner may conditionally approve a merger …

Sec. 122.1531. CONSIDERATIONS IN DETERMINATION. In determining whether to approve or disapprove the merger or consolidation, the commissioner shall consider the availability and adequacy of financial services in the local community and the effect that the merger or consolidation …

Sec. 122.154. PROPERTY, OBLIGATIONS, AND LIABILITIES OF MERGED OR CONSOLIDATED CREDIT UNION. After a merger or consolidation is effected: (1) the property of the merged or consolidated credit union vests in the surviving credit union without an instrument of transfer or endorseme…

Sec. 122.155. CONSTRUCTION OF SUBCHAPTER. This subchapter shall be construed, when possible, to permit a credit union authorized to do business in this state under other law to merge or consolidate with a credit union authorized to do business under this subtitle. Acts 1997, 75th…

Sec. 122.156. RULES TO ADDRESS CERTAIN PROCEDURES. The rules adopted under this subchapter must specify in detail the procedures that: (1) a credit union must follow to obtain commissioner approval of a merger or consolidation; and (2) the commissioner must follow in approving or…

Sec. 122.201. CONVERSION OF STATE CREDIT UNION TO FEDERAL CREDIT UNION. (a) A credit union organized under the laws of this state may convert to a credit union under the laws of the United States: (1) on an affirmative vote by a majority of the members voting at a meeting called …

Sec. 122.202. CONVERSION OF STATE CREDIT UNION TO OUT-OF-STATE CREDIT UNION. A credit union organized under the laws of this state may convert to a credit union under the laws of another state: (1) on an affirmative vote by a majority of the members voting at a meeting called for…

Sec. 122.203. CONVERSION OF FEDERAL OR OUT-OF-STATE CREDIT UNION TO STATE CREDIT UNION. A credit union organized under the laws of the United States or of another state may convert to a credit union organized under the laws of this state by complying with: (1) the requirements of…

Sec. 122.251. DEFAMATION. (a) A person commits an offense if the person knowingly: (1) makes, circulates, or transmits to another person a false statement that is derogatory to the financial condition of a credit union with the intent to injure that credit union; or (2) counsels,…

Sec. 122.252. CONSIDERATION FOR LOAN, INVESTMENT, OR PURCHASE. (a) A person commits an offense if the person: (1) is a director, honorary director, advisory director, committee member, officer, or employee of a credit union; and (2) knowingly demands or receives, directly or indi…

Sec. 122.253. LOAN TO NONMEMBER. (a) A person commits an offense if the person: (1) is a director, honorary director, advisory director, committee member, officer, or employee of a credit union; and (2) knowingly permits a loan to be made to a nonmember or participates in a loan …

Sec. 122.254. FALSE STATEMENTS OR DOCUMENTS; DESTRUCTION OF RECORDS. (a) A person commits an offense if the person, knowingly and with the intent to deceive: (1) makes a false entry on a record, report, or statement of a credit union; or (2) in connection with an examination or i…