HOUSE BILL NO. 220
INTRODUCED BY B. LAWSON
AN ACT GENERALLY REVISING PROVISIONS OF THE MONTANA CREDIT UNION ACT; PROVIDING THAT ELECTRONICALLY GENERATED AND STORED CREDIT UNION RECORDS ARE ADMISSIBLE AS EVIDENCE OF A TRANSACTION; CLARIFYING THAT A CREDIT UNION SUPERVISORY COMMITTEE NEED ONLY BE APPOINTED IF THE CREDIT UNION BYLAWS PROVIDE FOR A SUPERVISORY COMMITTEE; PROVIDING THAT DIVIDENDS MUST BE PAID ON ALL SHARES ACCORDING TO ANY METHOD OF CALCULATION ALLOWED BY LAW; REMOVING THE REQUIREMENT THAT THE PURPOSE OF THE LOAN BE STATED IN A LOAN APPLICATION; AMENDING SECTIONS 32-3-204, 32-3-301, 32-3-403, 32-3-502, AND 32-3-602, MCA; AND PROVIDING AN IMMEDIATE EFFECTIVE DATE.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:
Section 1. Section 32-3-204, MCA, is amended to read:
"32-3-204. Records. (1) A credit union shall maintain all books, records, accounting systems, and procedures in
accordance with such rules as that the director from time to time of the department of commerce prescribes. In prescribing
such rules, the director shall consider the relative size of a credit union and its reasonable capability of compliance.
(2) A credit union is not liable for destroying records after the expiration of the record retention time prescribed by the director.
(3) A photostatic or photographic copy or reproduction of any kind, including electronic or computer-generated data
that has been electronically stored and is capable of being converted into written form, of any credit union records shall
must be admissible as evidence of transactions with the credit union."
Section 2. Section 32-3-301, MCA, is amended to read:
"32-3-301. Organization procedure. (1) Any seven or more residents of this state, who are of legal age, and who have
a common bond, defined as described in 32-3-304, may organize a credit union and become charter members thereof of the
credit union by complying with this section.
(2) The subscribers shall execute, in duplicate, articles of incorporation, which that conform to the applicable Montana
corporation law, and shall agree to the terms thereof, which of the articles. The articles shall must state:
(a) the name, which shall must include the words "credit union" and which shall may not be the same as that of any
other existing credit union in this state, and the location where the proposed credit union is to have its principal place of
business;
(b) that the existence of the credit union is perpetual;
(c) the par value of the shares of the credit union, which shall must be in $5 multiples of not less than $5 or more than
$25;
(d) that the credit union shall be is organized under this chapter for the purposes set forth therein in the articles;
(e) the names and addresses of the subscribers to the articles of incorporation and the value of shares subscribed to by
each, which shall may be not less than $5; and
(f) that the credit union may exercise such incidental powers as that are necessary or requisite to enable it to carry on
effectively the business for which it is incorporated and those powers which that are inherent in the credit union as a legal
entity.
(3) The subscribers shall prepare and adopt bylaws for the general government of the credit union, consistent with this
chapter, and execute the same bylaws in duplicate.
(4) The subscribers shall select at least five qualified persons who agree to serve on the board of directors and at least
three qualified persons who agree to serve on the supervisory committee if the bylaws provide for a supervisory committee.
A signed agreement to serve in these capacities until the first annual meeting or until the election of their successors,
whichever is later, shall must be executed by those persons who so agree to serve. This agreement shall must be submitted
to the director of the department of commerce.
(5) The subscribers shall forward the articles of incorporation and the bylaws to the director of the department of
commerce. The director may issue a certificate of approval if the articles and the bylaws are in conformity with this chapter
and he if the director is satisfied that the proposed field of operation is favorable to the success of such the credit union and
that the standing of the proposed organizers is such as to give gives assurance that its the credit union's affairs will be
properly administered. He The director shall return a copy of the bylaws and the articles to the applicants or their
representatives, which shall must be preserved in the permanent files of the credit union. The application shall must be
acted upon within 30 days. The articles of incorporation shall must then be filed with the secretary of state who, upon
payment of the filing fees therefor for filing the articles, shall issue a certificate of incorporation.
(6) The subscribers for a credit union charter shall may not transact any business until formal approval of the charter has
been received."
Section 3. Section 32-3-403, MCA, is amended to read:
"32-3-403. Election or appointment of officials. (1) The credit union shall must be directed by a board, consisting of
an odd number of at least five directors, at least five in number, to be elected at the annual membership meeting by and
from the members. All members of the board shall hold office for such terms as that the bylaws provide.
(2) The board of directors shall appoint a supervisory committee of not less than three members at the organization
meeting and within 30 days following each annual meeting of the members for such terms as that the bylaws provide.
However, the bylaws of the credit union may provide that the supervisory committee members are elected for such terms as
that the bylaws provide by the members of the credit union at the annual meeting of the members or may provide that the
credit union may not have a supervisory committee. If the bylaws provide that the credit union may not have a supervisory
committee, the duties and powers of the supervisory committee, as described in 32-3-417 and 32-3-418(1), are the
responsibility of the board of directors.
(3) The board of directors shall appoint a credit committee, consisting of an odd number, not less than of at least three
members, for such terms as that the bylaws provide or, in lieu of a credit committee, shall appoint a credit manager."
Section 4. Section 32-3-502, MCA, is amended to read:
"32-3-502. Dividends. At the intervals and for the periods that the board of directors authorizes and after providing for
the required reserves, the board of directors may declare dividends to be paid from the undivided earnings at the rates and
upon the classes of shares that the board determines. The dividends must be paid on all shares outstanding at the close of
the period for which the dividend is declared. The dividends must be paid on all shares according to any method of
calculation allowed by law."
Section 5. Section 32-3-602, MCA, is amended to read:
"32-3-602. Loan application. Every application for a loan shall must be made in writing upon a form which that the
credit committee, credit manager, or loan officer prescribes. The application shall must state the purpose for which the loan
is desired and the security, if any, offered. Each loan shall must be evidenced by a written document or electronic data
capable of being converted into written form."
Section 6. Effective date. [This act] is effective on passage and approval.
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