Article 2 - Establishment of a California Branch Office or California Facility

California Financial Code — §§ 16020-16024

Sections (5)

Added by Stats. 2000, Ch. 612, Sec. 3. Effective January 1, 2001.

(a)Except for the activities described in paragraph (2) of subdivision (c) of Section 16001, no foreign (other state) credit union shall transact business in this state except at a branch office or facility that it is licensed to maintain and at which it is permitted by this chapter to transact the business transacted.

(b)Subdivision (a) shall not be deemed to prohibit any of the following:

(1)Any foreign

(other state) credit union from carrying on the activities described in subdivision (d) of Section 191 of the Corporations Code.

(2)The advertising or solicitation of shares or deposits in this state by a foreign (other state) credit union made through the media of the mail, radio, television, magazines, newspapers, the Internet, or similar media, provided that shares or deposits are not accepted or received in this state.

(3)The acceptance of loan applications through agents in this state, provided the loan applications are approved or rejected, and the loans are funded, outside of this state.

(c)For the purposes of subdivision (a), no foreign (other state) credit union shall be deemed to be transacting business in this state merely because a majority-owned subsidiary transacts business in this

state.

§ 16021

Added by Stats. 2000, Ch. 612, Sec. 3. Effective January 1, 2001.

(a)No foreign (other state) credit union shall establish or maintain a California branch office unless the commissioner shall have first approved its establishment and issued a license authorizing the foreign (other state) credit union to maintain the California branch office.

(b)Notwithstanding subdivision (a), this article does not apply to any branch office or other office in this state of a foreign (other state) credit union that was established prior to January 1, 2001,

in compliance with existing law.

§ 16022

Added by Stats. 2000, Ch. 612, Sec. 3. Effective January 1, 2001.

(a)If the commissioner finds all of the following with respect to an application by a foreign (other state) credit union for approval to establish a California branch office, the commissioner shall approve the application:

(1)That the foreign (other state) credit union, the directors and officers of the foreign (other state) credit union, and the proposed management of the branch office are each of good character and sound financial standing.

(2)That the financial history and condition of the foreign (other state) credit union are satisfactory.

(3)That the management of the foreign (other state) credit union and the proposed management of the branch office are adequate.

(4)That it is reasonable to believe that, if licensed to maintain the branch office, the foreign (other state) credit union will operate the branch office in a safe and sound manner and in compliance with all applicable laws, regulations, and orders.

(5)That the foreign (other state) credit union’s plan to establish and to maintain the branch office affords reasonable promise of successful operation.

(6)That the foreign (other state) credit union’s

establishment and maintenance of the branch office will promote the convenience and advantage of its members, and is necessary or convenient to meet the needs of the foreign (other state) credit union’s members.

(7)Not more than 50 percent of the members of the foreign (other state) credit union are or will be residents of this state.

If the commissioner finds otherwise, the commissioner shall deny the application.

(b)Whenever an application by a foreign (other state) credit union for approval to establish a California branch office has been approved and all conditions precedent to the issuance of a license authorizing the foreign (other state) credit union to maintain the California branch office have been fulfilled, the commissioner shall issue the license.

§ 16023

Added by Stats. 2000, Ch. 612, Sec. 3. Effective January 1, 2001.

The approval of an application for approval to establish a California branch office shall be revoked by operation of law if the applicant foreign (other state) credit union does not establish and maintain the California branch office within one year after the date of the approval, unless prior to the expiration of the one-year period the commissioner extends the time within which the foreign (other state) credit union may establish the California branch office.

§ 16024

Amended by Stats. 2001, Ch. 159, Sec. 93. Effective January 1, 2002.

(a)Within 30 days of establishing a California facility, a foreign (other state) credit union shall notify the commissioner in writing of its intent to establish a California facility. The notice shall identify the proposed location of the facility, describe its proposed activities, and contain any other information which the commissioner may by regulation or order specify.

(b)A foreign (other state) credit union shall not commence business at a proposed facility without a

license having been issued by the commissioner.