South Carolina General Assembly
117th Session, 2007-2008

Download This Version in Microsoft Word format

Bill 235

Indicates Matter Stricken
Indicates New Matter


(Text matches printed bills. Document has been reformatted to meet World Wide Web specifications.)

Indicates Matter Stricken

Indicates New Matter

COMMITTEE REPORT

May 23, 2007

S. 235

Introduced by Senators Hayes, Thomas and Knotts

S. Printed 5/23/07--H.    [SEC 5/24/07 2:13 PM]

Read the first time February 28, 2007.

            

THE COMMITTEE ON

LABOR, COMMERCE AND INDUSTRY

To whom was referred a Bill (S. 235) to amend Sections 34-26-110, Code of Laws of South Carolina, 1976, relating to definitions of the South Carolina Credit Union Act, so as to revise, etc., respectfully

REPORT:

That they have duly and carefully considered the same and recommend that the same do pass with amendment:

Amend the bill, as and if amended, by striking SECTION 1 in its entirety and inserting:

/ SECTION    1.    Section 34-26-110(6) of the 1976 Code, as added by Act 371 of 1996, is amended to read:

"(6)    'Deposit account' means a balance held by a credit union and established by a member, another credit union, organization, as defined in the Federal Credit Union Act, revised October 1998, Title 1, Section 1785-205(2), Paragraph (1), or a governmental unit in accordance with standards specified by the credit union including balances designated as deposits, deposit certificates, checking accounts, or other names. Ownership of a deposit account does not confer membership or voting rights and does not represent an interest in the capital of the credit union upon dissolution. A deposit account is a debt owed by the credit union to the credit holder." /

Amend further, Section 34-26-860, SECTION 7, page 4, by striking lines 39 and 40 and inserting:

/ guaranteed. Real estate loan requirements for loan to value and certified appraisals shall not exceed maximums allowed for federally chartered credit unions. /

When amended Section 34-26-860 reads:

/ Section 34-26-860.    A credit unions are union is authorized to make loans secured by real estate. The real estate collateral may consist of improved or unimproved property including, but not limited to, a mobile homes home, modular homes home, vacation homes home, property under construction, condominiums condominium, or single family dwellings dwelling which shall must be the borrower's primary residence.

Loan terms for unimproved real estate may not exceed fifteen years. Loan terms for a residential dwellings dwelling may not exceed thirty years the maximum allowed by FNMA or GNMA.

No loans shall be made in excess of eighty-five percent of the appraised value unless such excess amount is insured or similarly guaranteed. Real estate loan requirements for loan to value and certified appraisals shall not exceed maximums allowed for federally chartered credit unions.

Loans of fifty thousand dollars or more shall require a certified appraisal. Loans of less than fifty thousand dollars shall require A loan that does not require a certified appraisal requires an inspection by a credit union-appointed individual and evidence of value in the file. A loan applications application, notes note, and security instruments instrument may be executed on current versions of FHA, VA, FHLMC, FNMA, or FHLMC/FNMA approved forms.

Loans A loan may not be made on real estate located beyond the continental United States of America." /

Renumber sections to conform.

Amend title to conform.

HARRY F. CATO for Committee.

            

A BILL

TO AMEND SECTIONS 34-26-110, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO DEFINITIONS OF THE SOUTH CAROLINA CREDIT UNION ACT, SO AS TO REVISE THE DEFINITIONS OF "DEPOSIT ACCOUNT" AND "SHARE ACCOUNT"; 34-26-350, RELATING TO THE PRINCIPAL PLACE OF BUSINESS OF A CREDIT UNION, SO AS TO CLARIFY THAT THE CREDIT UNION MAY ESTABLISH AND CLOSE BRANCHES WITH THE APPROVAL OF THE BOARD OF FINANCIAL INSTITUTIONS; 34-26-420, RELATING TO POWERS INCIDENTAL TO THE PURPOSE OF CREDIT UNIONS, SO AS TO PROVIDE THAT THE POWERS GRANTED BY STATE LAW OR REGULATION TO A STATE-CHARTERED CREDIT UNION NOT EXCEEDING THOSE FOR A FEDERALLY-INSURED FINANCIAL INSTITUTION; 34-26-500, AS AMENDED, RELATING TO THE REQUIREMENTS OF MEMBERSHIP OF A CREDIT UNION, SO AS TO DELETE THE PROVISION THAT A CREDIT UNION PRESENTLY DOES NOT HAVE A CREDIT UNION SERVICE AVAILABLE, AND PROVIDE THAT THE BOARD APPROVAL IS NOT NECESSARY TO ADD GROUPS WITH NOT MORE THAN TWO HUNDRED FIFTY POTENTIAL MEMBERS INSTEAD OF ONE HUNDRED; 34-26-605, RELATING TO THE BOARD OF A CREDIT UNION, SO AS TO PROVIDE THAT THE BYLAWS MAY OFFER THE OPTION OF USING LOAN OFFICERS INSTEAD OF A CREDIT COMMITTEE; 34-26-750, RELATING TO THE OWNERSHIP INTERESTS IN SHARE ACCOUNTS, SO AS TO REQUIRE THAT CREDIT UNION BYLAWS MUST ESTABLISH MEMBERSHIP AND MEMBER'S RIGHT TO VOTE, OBTAIN LOANS, OR HOLD OFFICE; AND 34-26-860, AS AMENDED, RELATING TO THE LIMITATION ON THE SIZE OF LOAN SECURED BY REAL ESTATE, SO AS TO PROVIDE THAT LOAN TERMS FOR RESIDENTIAL DWELLINGS MAY NOT EXCEED FORTY INSTEAD OF THIRTY YEARS, AND TO PROVIDE THAT LOANS FOR CERTIFIED APPRAISALS MUST BE THE SAME AS FOR STATE-CHARTERED BANKS.

Be it enacted by the General Assembly of the State of South Carolina:

SECTION    1.    Section 34-26-110(6) and (16) of the 1976 Code, as added by Act 371 of 1996, is amended to read:

"(6)    'Deposit account' means a balance held by a credit union and established by a member, another credit union, organization, as defined in the Federal Credit Union Act, revised October 1998, Title 1, Section 1785-205(2), Paragraph (1), or a governmental unit in accordance with standards specified by the credit union including balances designated as deposits, deposit certificates, checking accounts, or other names. Ownership of a deposit account does not confer membership or voting rights and does not represent an interest in the capital of the credit union upon dissolution. A deposit account is a debt owed by the credit union to the credit holder.

(16)    'Share account' means a balance held by a credit union and established by a member in accordance with standards specified by the credit union including balances designated as shares, share certificates, share draft accounts, or other accounts. Ownership of a share account confers membership and voting rights and represents an interest in the capital of the credit union upon dissolution to members in good standing."

SECTION    2.    Section 34-26-350(4) of the 1976 Code, as added by Act 371 of 1996, is amended to read:

"(4)    A credit union may establish and close branches and purchase property for future expansion with approval of the Board of Financial Institutions."

SECTION    3.    Section 34-26-420 of the 1976 Code, as added by Act 371 of 1996, is amended to read:

"Section 34-26-420.    A credit union may exercise incidental powers to enable it to carry out its purposes. However, the powers granted by state law or regulation to a state-chartered credit union shall not exceed those provided by federal law or regulation to a federally chartered credit union."

SECTION    4.    Section 34-26-500(3) of the 1976 Code, as added by Act 371 of 1996, is amended to read:

"(3)    A credit union may add additional groups not to exceed one two hundred fifty potential members to its field of membership, from time to time as necessary, provided such the groups can reasonably be are served by one of the credit union's service facilities, such and the group having has provided a written request for service to the credit union, and does not presently have credit union service available. However, the Board of Financial Institutions may revoke the power of any a credit union to add groups under this provision provided by this section upon a finding that permitting additions under this provision pursuant to the provisions of this section are not in the best interest of the credit union. The adding of such these groups shall must be consistent with the following:

(a)    In order to add such additional groups, a credit union must first shall obtain a letter on the group's letterhead, where if possible, signed by an official representative identified by title, requesting credit union service and stating that the group does not have any other credit union service available from any source. The groups must shall indicate the number of potential members seeking service. This document must be maintained by the credit union permanently with its bylaws.

(b)    A credit union adding such groups must shall maintain a log of these groups added. The log must include the following: the date the group obtained service, the name and location of the group, the number of potential members added, the number of miles to the nearest main or branch office, and the date of the approval of such the group by the board of directors.

(c)    Upon complying with the above procedures, board approval shall is not be necessary to add such groups with no more than one two hundred fifty potential members to a credit union's field of membership. Approval of the Board of Financial Institutions shall must be obtained prior to before the addition of groups in excess of one two hundred fifty."

SECTION    5.    Section 34-26-605(2) of the 1976 Code, as added by Act 371 of 1996, is amended to read:

"(2)    At an organization meeting to be held within thirty days following each annual election, if it is stipulated in the bylaws, the board of directors shall appoint a credit committee which shall consist that consists of an odd number, not less than three, whose terms shall be are as the bylaws provide. The bylaws may offer the option of using loan officers instead of having a credit committee."

SECTION    6.    Section 34-26-750(1) of the 1976 Code, as added by Act 371 of 1996, is amended to read:

"(1)    A member may designate any person or persons to own a share account with the member in joint tenancy with the right of survivorship, as a tenant in common or under any other form of joint ownership permitted by law, but no co-owner, unless a member in his own right, shall be permitted to vote, obtain loans, or hold office or be required to pay a membership fee. Credit union bylaws or policy, or both, shall establish membership and member's right to vote, obtain loans, or hold office."

SECTION    7.    Section 34-26-860 of the 1976 Code, as last amended by Act 49 of 1999, is further amended to read:

"Section 34-26-860.    A credit unions are union is authorized to make loans secured by real estate. The real estate collateral may consist of improved or unimproved property including, but not limited to, a mobile homes home, modular homes home, vacation homes home, property under construction, condominiums condominium, or single family dwellings dwelling which shall must be the borrower's primary residence.

Loan terms for unimproved real estate may not exceed fifteen years. Loan terms for a residential dwellings dwelling may not exceed thirty years the maximum allowed by FNMA or GNMA.

No loans shall be made in excess of eighty-five percent of the appraised value unless such excess amount is insured or similarly guaranteed. Loan requirements for certified appraisals must be the same as for a federally charted credit union.

Loans of fifty thousand dollars or more shall require a certified appraisal. Loans of less than fifty thousand dollars shall require A loan that does not require a certified appraisal requires an inspection by a credit union-appointed individual and evidence of value in the file. A loan applications application, notes note, and security instruments instrument may be executed on current versions of FHA, VA, FHLMC, FNMA, or FHLMC/FNMA approved forms.

Loans A loan may not be made on real estate located beyond the continental United States of America."

SECTION    8.    This act takes effect upon approval by the Governor.

----XX----

This web page was last updated on Monday, June 22, 2009 at 2:31 P.M.