Minnesota Session Laws - 2019, Regular Session

CHAPTER 20--S.F.No. 1703

An act

relating to commerce; eliminating supermajority requirements for conversion, merger, or consolidation of credit unions;

amending Minnesota Statutes 2018, sections 52.201; 52.203.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2018, section 52.201, is amended to read:

52.201 REORGANIZING FEDERAL CREDIT UNION INTO STATE CREDIT UNION.

When any federal credit union authorized to convert to a state charter has taken the necessary steps under the federal law for that purpose, deleted text begin seven or more members, deleted text end upon deleted text begin authority deleted text end new text begin the affirmative vote new text end of deleted text begin two-thirds deleted text end new text begin a majority new text end of the members deleted text begin present and entitled to vote and who shall have voted for such conversion deleted text end new text begin who vote on the proposal, a quorum being present, new text end at a regular or special meeting upon deleted text begin 14 days mailed deleted text end new text begin at least seven but not more than 30 days' new text end written notice to each member deleted text begin at the member's last known address deleted text end clearly stating that such conversion is to be acted upon, and upon approval of the commissioner of commerce, may execute a certificate of incorporation under the provisions of the state Credit Union Act, which, in addition to the other requirements of law, shall state the authority derived from the shareholders of such federal credit union; and upon recording such certificate as required by law, it shall become a legal state credit union and the members of the federal credit union shall without further action be members of the state credit union. This includes members of the federal credit union on the basis of acceptance of small employer groups provided the commissioner may require contemporaneous filing of applications under section 52.05, subdivision 2. Thereupon the assets of the federal credit union, subject to its liabilities not liquidated under the federal law before such incorporation, shall vest in and become the property of such state credit union and the members upon request shall be entitled to a new passbook showing existing share and loan balances. The commissioner of commerce shall approve or disapprove of the conversion within 60 days of the date the proposal is presented.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective August 1, 2019. new text end

Sec. 2.

Minnesota Statutes 2018, section 52.203, is amended to read:

52.203 MERGER OR CONSOLIDATION.

Any credit union chartered by this state may merge with and be absorbed by any other state or federal credit union, and any credit union chartered by this or any other state or any federal credit union may be merged into a successor credit union chartered by this state, upon approval of all regulatory agencies concerned, and upon compliance with this section as regards the credit union chartered by this state. At the time of filing with the commissioner of any proposed merger or consolidation plan, the credit unions proposing to merge or consolidate shall submit a fee of $100 payable to the commissioner of commerce. The fee shall be paid in equal parts by the credit unions' party to the proposal.

A credit union may be absorbed after deleted text begin two-thirds deleted text end new text begin a majority new text end of its members deleted text begin present and entitled to vote deleted text end new text begin who vote on the proposal new text end have voted in favor of the merger at a special meeting called by a majority of the board of directors for that purpose, upon deleted text begin 14 deleted text end new text begin at least 45 but no more than 90 calendar new text end days mailed written notice to each member at the member's last known address new text begin if by mail, or by other verifiable means, new text end clearly stating the purpose of the special meeting, or at any regular meeting after like notice of the purpose has been given. Thereafter, the board of directors may execute an agreement of merger with the successor credit union, subject to approval of the agreement by the commissioner of commerce. The commissioner shall approve or disapprove of the agreement within 60 days of the date the agreement is submitted. The approved agreement must be filed with the secretary of state.

If the successor credit union which absorbs one or more credit unions is chartered by this state it may execute an agreement of merger upon approval of the agreement by the commissioner of commerce and by the board of directors of the credit union. The commissioner of commerce shall approve the merger agreement if it is in the best interest of the credit unions involved. In any event, the commissioner of commerce shall approve or disapprove of the merger agreement within 60 days of the date the agreement is submitted. Members of, and persons eligible for membership in, the credit union being absorbed have all rights of membership in the successor credit union.

The charter and license and all other rights and property of the credit union being absorbed is deemed to be transferred to and invested in the successor credit union upon execution and approval of the merger agreement without further action. Any pending action or other judicial proceeding to which the credit union being absorbed is a party at the date of merger does not abate by reason of the merger. If the credit union being absorbed is chartered by this state, its corporate existence ceases upon the execution and approval of the merger agreement without further action.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective August 1, 2019. new text end

Presented to the governor May 9, 2019

Signed by the governor May 9, 2019, 9:53 a.m.