FINANCE CODE

SUBTITLE D. CREDIT UNIONS

CHAPTER 121. GENERAL PROVISIONS


	§ 121.001.  SHORT TITLE.  This subtitle may be cited as 
the Texas Credit Union Act.

Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997.                   


	§ 121.0011.  POLICY.  The purposes of this subtitle are 
to safeguard the public interest, to promote public confidence in 
credit unions doing business in this state, to provide for the 
protection of the interests, shares, and deposits of credit unions, 
to delegate to the department rulemaking and discretionary 
authority that may be necessary to assure that credit unions 
operating under this subtitle may be sufficiently flexible and 
readily responsive to changes in economic conditions and practices, 
to maintain sound credit union growth and financial integrity, 
fiscal responsibility, and independent judgment in the management 
of the business affairs of credit unions, to permit credit unions to 
effectively provide a full array of financial and financially 
related services, to provide effective supervision and regulation 
of credit unions and their fields of membership, and to clarify and 
modernize the law governing the credit unions doing business in 
this state.  This subtitle is the public policy of this state and 
necessary to the public welfare.

Added by Acts 1999, 76th Leg., ch. 62, § 7.15, eff. Sept. 1, 
1999;  Acts 1999, 76th Leg., ch. 87, § 2, eff. Sept. 1, 1999.


	§ 121.002.  DEFINITIONS.  In this subtitle:                                 
		(1)  "Board" means the board of directors of a credit 
union.                
		(2)  "Credit union," unless the context relates to a 
federal credit union, means a voluntary, cooperative, nonprofit 
financial institution authorized to do business in this state under 
this subtitle for purposes of:
			(A)  encouraging thrift among its members;                                   
			(B)  creating a source of credit at fair and 
reasonable interest rates;    
			(C)  developing and providing to its members 
alternative methods of financing their purchases at reasonable 
costs;
			(D)  providing an opportunity for its members to 
use and control their money to improve their economic and social 
condition;  and
			(E)  conducting any other business, engaging in 
any other activity, or providing any other service that may benefit 
its members.
		(3)  "Commission" means the Credit Union Commission.                          
		(4)  "Commissioner" means the credit union 
commissioner.                    
		(5)  "Department" means the credit union department.                          
		(6)  "Deputy commissioner" means the deputy credit 
union commissioner.      
		(7)  "Foreign credit union" means a credit union that 
is not organized under the laws of this state or the United States.
		(8)  "Law enforcement agency" means the Department of 
Public Safety of the State of Texas, the Federal Bureau of 
Investigation, or any local police or sheriff department.
		(9)  "Membership share" means a designated share 
account of a credit union consisting of the balance held by the 
credit union and established by a credit union member in accordance 
with the standards specified by the credit union.
		(10)  "Organization" means a corporation, partnership, 
association, limited liability company, or other legal entity.
		(11)  "Unsafe or unsound condition," with respect to a 
credit union, includes:
			(A)  being insolvent;                                                        
			(B)  having incurred or being likely to incur a 
loss that will deplete all or substantially all of the credit 
union's net worth;  or
			(C)  being in imminent danger of losing the credit 
union's share and deposit insurance or guarantee.
		(12)  "Unsafe or unsound practice" means an action or 
inaction in the operation of a credit union that is contrary to 
generally accepted standards of prudent operation, the likely 
consequences of which, if continued, would be abnormal and material 
risk of loss or danger to a credit union, the credit union's 
members, or an organization insuring or guaranteeing the credit 
union's shares and deposits.

Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997.  Amended 
by Acts 1999, 76th Leg., ch. 157, § 5, eff. Sept. 1, 1999; Acts 
2003, 78th Leg., ch. 533, § 6, eff. Sept. 1, 2003.


	§ 121.003.  CREDIT UNIONS SUBJECT TO SUBTITLE.  A credit 
union organized and existing under the laws of this state is 
governed by and authorized to do business under this subtitle.

Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997.                   


	§ 121.004.  LIBERAL CONSTRUCTION.  This subtitle shall 
be liberally construed to effect its purposes.

Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997.                   


	§ 121.005.  HEARINGS.  (a)  A hearing held under this 
subtitle is governed by Chapter 2001, Government Code.
	(b)  The commission may adopt rules of procedure for a 
hearing held under this subtitle.
	(c)  This section does not apply to a meeting under Section 
122.005.         

Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997.  Amended 
by Acts 1999, 76th Leg., ch. 62, § 7.14(a), eff. Sept. 1, 1999.


	§ 121.006.  PROCEDURE AND RULES APPLICABLE TO CERTAIN 
PROCEEDINGS.  (a)  If the commissioner proposes to revoke a credit 
union's certificate of incorporation, the credit union is entitled 
to a hearing conducted by the State Office of Administrative 
Hearings.
	(b)  A proceeding for a disciplinary action is governed by 
Chapter 2001, Government Code.  Rules of practice adopted by the 
commission under Section 2001.004, Government Code, applicable to a 
proceeding for a disciplinary action may not conflict with rules 
adopted by the State Office of Administrative Hearings.

Added by Acts 1999, 76th Leg., ch. 62, § 7.14(b), eff. Sept. 1, 
1999.  Amended by Acts 2003, 78th Leg., ch. 533, § 7, eff. Sept. 
1, 2003.