Financial Code — Part 15 | FIN — United States — California law | Esheria

Financial Code

Part 15 of 17 · provisions 2,801–3,000

This section says the act may be cited as the Financial Code.

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APR disclosure ATM lighting ATM operations ATM surcharge disclosure ATM user safety Application hearings Approval changes California branch office California branch offices California facilities FDIC notice Holding companies Investment in securities Investment operations PACE assessment PACE assessment contracts PACE assessments PACE contracts PACE financing PACE program administration PACE programs PACE solicitor PACE solicitor agents PACE solicitors +3,232 more

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The commissioner must let certain debt collectors keep operating if they applied before January 1, 2023, and may issue a conditional license while an application is pending. Local governments in this state may not require a debt collector to be licensed or to register as a debt collector. This division is named the Debt Collection Licensing Act and may be cited by that name. A person may not do debt collection business in this state without first getting a license, and the license is tied to the principal place of business and cannot be transferred or assigned. This section defines key terms used in the Debt Collection Licensing Act.

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Provisions of Financial Code

Showing 200 of 3,273

  1. 521.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 5. Examinations and Reports-Banking [500 - 521] ( Chapter 5 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Reports [520 - 521] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. )

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    Banks and credit unions under the commissioner’s examination authority must file an annual fee-revenue report by March 1, and the commissioner must publish the reported data.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 5. Examinations and Reports-Banking [500 - 521] ( Chapter 5 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Reports [520 - 521] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 521. (a) A bank or credit union subject to the examination authority of the commissioner shall report annually, on or before March 1, to the commissioner on the amount of revenue earned from overdraft fees and nonsufficient funds fees collected in the most recently completed calendar year and the percentage of that revenue as a proportion of the net income of the bank or credit union. (b) (1) The commissioner shall publish, pursuant to paragraph (2), in a report the data for each bank or credit union required by subdivision (a) and make the report available on the department’s internet website. (2) (A) The commissioner shall publish the first report required by this subdivision on or before March 31, 2023, covering data from the 2022 calendar year. (B) In a calendar year beginning on or after January 1, 2024, the commissioner shall publish the report required by this subdivision on or before March 31 covering data from the most recently completed calendar year. (c) As used in this section: (1) “Nonsufficient funds fees” means fees resulting from the initiation of a transaction that exceeds the customer’s account balance if the customer’s bank or credit union declines to make the payment. (2) “Overdraft fees” means fees resulting from the processing of a debit transaction that exceeds a customer’s account balance. (Added by Stats. 2022, Ch. 847, Sec. 1. (SB 1415) Effective January 1, 2023.)
  2. 530.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 5.5. Nonsufficient Funds Fees [530- 530.] ( Chapter 5.5 added by Stats. 2024, Ch. 509, Sec. 1. )

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    Banks and credit unions covered by the commissioner may not charge a consumer an NSF fee when a transaction attempt is declined instantly or nearly instantly because of insufficient funds.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 5.5. Nonsufficient Funds Fees [530- 530.] ( Chapter 5.5 added by Stats. 2024, Ch. 509, Sec. 1. ) ## 530. A bank or credit union subject to the examination authority of the commissioner shall not charge a consumer a nonsufficient funds fee, as defined in Section 521, when the consumer’s attempt to initiate a transaction is declined instantaneously or near instantaneously by the bank or credit union due to nonsufficient funds. (Added by Stats. 2024, Ch. 509, Sec. 1. (AB 2017) Effective January 1, 2025.)
  3. 5300.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Penalties [5300 - 5311] ( Article 4 added by Stats. 1987, Ch. 1162, Sec. 4. )

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    A person who willfully violates or fails to comply with this division commits a public offense and may be fined up to $10,000, jailed up to one year, or both, unless a different punishment applies.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Penalties [5300 - 5311] ( Article 4 added by Stats. 1987, Ch. 1162, Sec. 4. ) ## 5300. Every person who willfully violates or willfully fails to comply with any of the provisions of this division is guilty of a public offense. Except where the offense is declared to be a felony or a misdemeanor or a different punishment is prescribed, a person convicted under this section shall be punished by a fine of not more than ten thousand dollars ($10,000), or by imprisonment in the county jail not exceeding one year or pursuant to subdivision (h) of Section 1170 of the Penal Code, or by both that fine and imprisonment. (Amended by Stats. 2011, Ch. 15, Sec. 100. (AB 109) Effective April 4, 2011. Operative October 1, 2011, by Sec. 636 of Ch. 15, as amended by Stats. 2011, Ch. 39, Sec. 68.)
  4. 5301.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Penalties [5300 - 5311] ( Article 4 added by Stats. 1987, Ch. 1162, Sec. 4. )

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    The commissioner may refer evidence of certain violations to the Attorney General or the local district attorney, who may start civil or criminal proceedings. The commissioner’s staff may help at trial if requested.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Penalties [5300 - 5311] ( Article 4 added by Stats. 1987, Ch. 1162, Sec. 4. ) ## 5301. (a) The commissioner may refer such evidence as is available concerning any violation of this division or of any regulation, order issued by the commissioner, or of any condition imposed in writing by the commissioner in connection with any grant of any application or request by the savings association or of a written agreement between the savings association and the commissioner to the Attorney General or to the district attorney of the county in which the violation occurred, who may, with or without such a referral, institute appropriate civil or criminal proceedings under this division. (b) The commissioner and his or her counsel, deputies, or assistants may, upon request of the Attorney General or district attorney, assist the Attorney General or district attorney in presenting law or facts at any trial in these proceedings. (Added by Stats. 1990, Ch. 1118, Sec. 11.)
  5. 5302.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Penalties [5300 - 5311] ( Article 4 added by Stats. 1987, Ch. 1162, Sec. 4. )

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    This section sets criminal penalties for knowingly violating Section 6525.5(a) or (b), or for knowingly violating an order issued under Section 8201.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Penalties [5300 - 5311] ( Article 4 added by Stats. 1987, Ch. 1162, Sec. 4. ) ## 5302. (a) Whoever knowingly violates subdivision (a) or (b) of Section 6525.5 shall be punished by a fine of not more than one million dollars ($1,000,000) for each day the violation continues, by imprisonment pursuant to subdivision (h) of Section 1170 of the Penal Code for 2, 3, or 4 years, or by both that fine and imprisonment. (b) Any person who is subject to an order issued pursuant to Section 8201 who knowingly violates the order, directly or indirectly, shall be punished by a fine of not more than one million dollars ($1,000,000) for each day violation continues, by imprisonment pursuant to subdivision (h) of Section 1170 of the Penal Code for 2, 3, or 4 years, or by both that fine and imprisonment. (Amended by Stats. 2011, Ch. 15, Sec. 101. (AB 109) Effective April 4, 2011. Operative October 1, 2011, by Sec. 636 of Ch. 15, as amended by Stats. 2011, Ch. 39, Sec. 68.)
  6. 5303.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Penalties [5300 - 5311] ( Article 4 added by Stats. 1987, Ch. 1162, Sec. 4. )

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    Certain officers, directors, employees, or agents of an association must not make false material entries, omit required material entries, or hide or destroy association records when done with intent to deceive. Violations can be fined or punished by imprisonment.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Penalties [5300 - 5311] ( Article 4 added by Stats. 1987, Ch. 1162, Sec. 4. ) ## 5303. Any officer, director, employee, or agent of any association who (a) willfully makes or knowingly concurs in the making or publishing of a false or untrue material entry in any book, record, report, statement concerning the business or affairs of the association, or statement of condition or in connection with any transaction of the association, with intent to deceive any officer or director thereof, or with intent to deceive any agency or examiner, whether private or public, employed or lawfully appointed to examine into the association’s condition or to examine into any of the association’s affairs or transactions, or with intent to deceive any public officer, office, or board to which the association is required by law to report or that has authority by law to examine into the association’s affairs or transactions, (b) with like intent, willfully omits to make a material new entry of any matter particularly pertaining to the business, property, condition, affairs, transactions, assets, or accounts of the association in any appropriate book, record, report, or statement of the association, which entry is required to be made by law or generally accepted accounting principles applicable to a savings institution, or (c) with like intent, willfully alters, abstracts, conceals, refuses to allow to be inspected by the commissioner or the commissioner’s deputies or examiners, or destroys any books, records, reports, or statements of the association made, written, or kept, or required to be made, written, or kept by him or her or under his or her direction, shall be punished by a fine of not more than one million dollars ($1,000,000), by imprisonment pursuant to subdivision (h) of Section 1170 of the Penal Code for two, three, or four years, or by both that fine and imprisonment. (Amended by Stats. 2011, Ch. 15, Sec. 102. (AB 109) Effective April 4, 2011. Operative October 1, 2011, by Sec. 636 of Ch. 15, as amended by Stats. 2011, Ch. 39, Sec. 68.)
  7. 5304.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Penalties [5300 - 5311] ( Article 4 added by Stats. 1987, Ch. 1162, Sec. 4. )

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    It is unlawful to corruptly give, offer, promise, solicit, demand, accept, or agree to accept anything of value to influence or reward an institution-affiliated party in connection with a savings association transaction.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Penalties [5300 - 5311] ( Article 4 added by Stats. 1987, Ch. 1162, Sec. 4. ) ## 5304. (a) It is unlawful for any person to corruptly give, offer, or promise anything of value to any other person, with intent to influence or reward any institution-affiliated party in connection with any business or transaction of a savings association. (b) It is unlawful for any institution-affiliated party to corruptly solicit or demand for the benefit of any person, or corruptly accept or agree to accept, anything of value from any person, intending to be influenced or rewarded in connection with any business or transaction of the savings association. (c) Any person who violates subdivision (a) or (b) shall be punished by a fine of not more than one million dollars ($1,000,000) or three times the value of the thing given, offered, promised, solicited, demanded, accepted, or agreed to be accepted, whichever is greater, by imprisonment pursuant to subdivision (h) of Section 1170 of the Penal Code for 2, 3, or 4 years, or by both that fine and imprisonment. However, if the value of the thing given, offered, promised, solicited, demanded, accepted, or agreed to be accepted does not exceed one thousand dollars ($1,000), the offense shall instead be punishable by a fine of not more than one thousand dollars ($1,000), by imprisonment in a county jail for not more than one year, or pursuant to subdivision (h) of Section 1170 of the Penal Code, or by both that fine and imprisonment. (d) This section does not apply to bona fide salary, wages, fees, or other compensation paid, or expenses paid or reimbursed, in the usual course of business or where the amount of money or monetary worth of the thing of value is one hundred dollars ($100) or less. (Amended by Stats. 2011, Ch. 15, Sec. 103. (AB 109) Effective April 4, 2011. Operative October 1, 2011, by Sec. 636 of Ch. 15, as amended by Stats. 2011, Ch. 39, Sec. 68.)
  8. 5305.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Penalties [5300 - 5311] ( Article 4 added by Stats. 1987, Ch. 1162, Sec. 4. )

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    An institution-affiliated party who misapplies or takes savings association money, funds, property, or credit commits a felony and faces fines, imprisonment, or both.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Penalties [5300 - 5311] ( Article 4 added by Stats. 1987, Ch. 1162, Sec. 4. ) ## 5305. Any institution-affiliated party who abstracts or willfully misapplies any of the money, funds, or property of the savings association, or willfully misapplies its credit, is guilty of a felony and shall be punished by a fine of not more than one million dollars ($1,000,000), by imprisonment pursuant to subdivision (h) of Section 1170 of the Penal Code for 2, 3, or 4 years, or by both that fine and imprisonment. However, if the amount abstracted or willfully misapplied does not exceed two hundred fifty dollars ($250), the offense shall instead be punishable by a fine of not more than one thousand dollars ($1,000), by imprisonment in a county jail for not more than one year, or pursuant to subdivision (h) of Section 1170 of the Penal Code, or by both that fine and imprisonment. (Amended by Stats. 2011, Ch. 15, Sec. 104. (AB 109) Effective April 4, 2011. Operative October 1, 2011, by Sec. 636 of Ch. 15, as amended by Stats. 2011, Ch. 39, Sec. 68.)
  9. 5306.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Penalties [5300 - 5311] ( Article 4 added by Stats. 1987, Ch. 1162, Sec. 4. )

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    An institution-affiliated party who knowingly tries to defraud a savings association, or to get its money or property by false pretenses, can be fined, imprisoned, or both.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Penalties [5300 - 5311] ( Article 4 added by Stats. 1987, Ch. 1162, Sec. 4. ) ## 5306. Any institution-affiliated party who knowingly executes, or attempts to execute, a scheme or artifice to defraud a savings association or to obtain any of the moneys, funds, credits, assets, securities or other property owned by or under the custody or control of a savings association by means of false or fraudulent pretenses, representations, or promises, shall be punished by a fine of not more than one million dollars ($1,000,000), by imprisonment in state prison for 2, 3, or 4 years, or by both that fine and imprisonment. (Added by Stats. 1990, Ch. 1118, Sec. 18.)
  10. 5307.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Penalties [5300 - 5311] ( Article 4 added by Stats. 1987, Ch. 1162, Sec. 4. )

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    A person who willfully and knowingly spreads or allows false or malicious statements or rumors about an association may be fined, jailed, or both.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Penalties [5300 - 5311] ( Article 4 added by Stats. 1987, Ch. 1162, Sec. 4. ) ## 5307. Whoever willfully and knowingly makes, issues, circulates, transmits, or causes or knowingly permits to be made, issued, circulated, or transmitted, any statement or rumor which is written, printed, reproduced in any manner, or communicated by word of mouth, that is untrue in fact and is directly or by inference false, or malicious in that it is calculated to injure the reputation or business, financial condition, or standing of any association shall be punished by a fine of not more than ten thousand dollars ($10,000), by imprisonment in a county jail not exceeding one year or pursuant to subdivision (h) of Section 1170 of the Penal Code, or by both that fine and imprisonment. (Amended by Stats. 2011, Ch. 15, Sec. 105. (AB 109) Effective April 4, 2011. Operative October 1, 2011, by Sec. 636 of Ch. 15, as amended by Stats. 2011, Ch. 39, Sec. 68.)
  11. 5308.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Penalties [5300 - 5311] ( Article 4 added by Stats. 1987, Ch. 1162, Sec. 4. )

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    A person who knowingly makes a false statement or report, or willfully overvalues land, property, or security to influence an association’s action, can be fined or jailed.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Penalties [5300 - 5311] ( Article 4 added by Stats. 1987, Ch. 1162, Sec. 4. ) ## 5308. Whoever knowingly makes or causes to be made, directly or indirectly, or through any agency whatsoever, any false statement or report, or willfully overvalues any land, property, or security, for the purpose of influencing in any way the action of any association upon any application, advance, discount, purchase or repurchase agreement, commitment, or loan or the change or extension of any of these transactions by renewal, deferment of action, or otherwise, or the acceptance, release, or substitution of security for these transactions shall be punished by a fine of not more than ten thousand dollars ($10,000) or, by imprisonment in the county jail not exceeding one year or in the state prison, or by both that fine and imprisonment. (Added by renumbering Section 5301 by Stats. 1990, Ch. 1118, Sec. 10.)
  12. 5309.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Penalties [5300 - 5311] ( Article 4 added by Stats. 1987, Ch. 1162, Sec. 4. )

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    A person meeting specified conditions must receive consecutive sentences for each violation of Sections 5303 to 5306, up to 20 years in state prison.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Penalties [5300 - 5311] ( Article 4 added by Stats. 1987, Ch. 1162, Sec. 4. ) ## 5309. (a) A person shall be sentenced to consecutive terms for each violation of Section 5303, 5304, 5305, or 5306 up to a mandatory term of 20 years in state prison if all of the following are charged in the accusatory pleading and admitted by the defendant, or found to be true by the trier of fact: (1) The person is an institution affiliated party. (2) The person engaged in a pattern and practice of activity involving multiple violations of Section 5303, 5304, 5305, or 5306. (3) The person acted with intent to cause substantial harm, or with reckless disregard of the possibility of causing substantial harm, to the savings institution. (4) The violations did in fact result in substantial harm to the savings institution. (b) No part of a consecutive sentence required pursuant to subdivision (a) may be suspended or revoked by the court. (c) Nothing in subdivision (a) shall limit the court’s discretion to sentence the defendant to a consecutive term longer than provided for in that subdivision, if otherwise permitted by law. (d) Nothing in subdivision (a) shall limit the court’s discretion to order consecutive sentences for violations of Section 5303, 5304, 5305, or 5306 under any other provision of law. (Added by renumbering Section 5307 (as added by Stats. 1990, Ch. 118, Sec. 18.5) by Stats. 1991, Ch. 1091, Sec. 30.)
  13. 5310.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Penalties [5300 - 5311] ( Article 4 added by Stats. 1987, Ch. 1162, Sec. 4. )

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    Violating or conspiring to violate Sections 5303 to 5306 can trigger a civil penalty, and the Attorney General may investigate and bring the recovery action.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Penalties [5300 - 5311] ( Article 4 added by Stats. 1987, Ch. 1162, Sec. 4. ) ## 5310. (a) Any person violating or conspiring to violate Sections 5303, 5304, 5305, or 5306 shall be subject to a civil penalty in an amount assessed by the court in a civil action under this section. (b) The maximum amount of the penalty which may be imposed under this section shall be determined in accordance with the following: (1) Except as provided by paragraphs (2) and (3), the civil penalty shall not exceed one million dollars ($1,000,000). (2) In the case of a continuing violation, the amount of the civil penalty may exceed the amount described in paragraph (1), but may not exceed the lesser of one million dollars ($1,000,000) for each day the violation continues or five million dollars ($5,000,000). (3) If any person derives pecuniary gain from the violation, or if the violation results in pecuniary loss to a person other than the violator, the amount of the civil penalty may exceed the amounts described in paragraphs (1) and (2) but may not exceed the amount of that gain or loss. (c) A civil action to recover a civil penalty under this section shall be brought in the name of the people of the State of California by the Attorney General, who shall be required to establish the right to recovery by a preponderance of the evidence. (d) For the purpose of conducting a civil investigation in contemplation of proceeding under this section, the Attorney General may do all of the following: (1) Administer oaths and affirmations. (2) Take evidence. (3) By subpoena or subpoena duces tecum, summon witnesses and require the production of any books, papers, correspondence, memoranda, or other records which the Attorney General deems relevant or material to the inquiry. (Added by Stats. 1990, Ch. 1118, Sec. 19.)
  14. 5311.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Penalties [5300 - 5311] ( Article 4 added by Stats. 1987, Ch. 1162, Sec. 4. )

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    Fines and civil penalties under this chapter must consider the defendant’s ability to pay, along with offense seriousness and pecuniary gain or loss. The chapter also bars a civil penalty after punishment by fine or imprisonment for the same violation, and bars a fine after a civil penalty for the same violation.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Penalties [5300 - 5311] ( Article 4 added by Stats. 1987, Ch. 1162, Sec. 4. ) ## 5311. (a) Any fine or civil penalty imposed under this chapter shall be based upon the ability of the defendant to pay. In setting the amount of the fine or civil penalty, consideration shall also be given to the seriousness of the offense, the amount of any pecuniary gain by the defendant, and the amount of any pecuniary loss, other than defendant’s own loss, caused by the offense. (b) A civil penalty may not be imposed against a person under this chapter if that person has been punished by a fine or imprisonment for the same violation. (c) A fine may not be imposed under this chapter if a civil penalty has previously been imposed for the same violation. (Added by Stats. 1990, Ch. 1118, Sec. 19.5.)
  15. 5320.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Criminal Forfeiture [5320 - 5325] ( Article 5 added by Stats. 1990, Ch. 1118, Sec. 20. )

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    Property traceable to certain specified convictions must be forfeited under this article.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Criminal Forfeiture [5320 - 5325] ( Article 5 added by Stats. 1990, Ch. 1118, Sec. 20. ) ## 5320. If a person is convicted of a violation of Section 5303, 5304, 5305, or 5306, or is convicted of a felony for a violation of Section 25540 or 25541 of the Corporations Code in connection with the operation of a lending institution subject to the jurisdiction of the department pursuant to this division, or is convicted of a felony violation of Section 487 or 504 of the Penal Code in connection with the operation of a lending institution subject to the jurisdiction of the department pursuant to this division any property which constitutes or is derived from proceeds traceable to that violation is subject to forfeiture pursuant to this article. (Amended by Stats. 1996, Ch. 1064, Sec. 549. Effective January 1, 1997. Operative July 1, 1997.)
  16. 5321.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Criminal Forfeiture [5320 - 5325] ( Article 5 added by Stats. 1990, Ch. 1118, Sec. 20. )

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    The prosecuting agency must file a forfeiture petition, give notice to interested persons, and follow extra steps for real property and early-filed petitions.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Criminal Forfeiture [5320 - 5325] ( Article 5 added by Stats. 1990, Ch. 1118, Sec. 20. ) ## 5321. (a) The prosecuting agency shall, prior to, in conjunction with, or subsequent to the criminal proceeding, file a petition of forfeiture with the superior court of the county in which the defendant has been or will be charged with the underlying criminal offense. The petition shall allege that the defendant has engaged in acts chargeable as crimes pursuant to the criminal provisions enumerated in Section 5320 and shall identify the property subject to forfeiture. A notice regarding the petition shall be provided, by personal service or registered mail, to every person who may have an interest in the property specified in the petition. However, if the notice cannot be given by registered mail or personal delivery, the notice shall be published for at least three successive weeks in a newspaper of general circulation in the county where the property is located. The notice shall state that any interested person may file a verified claim with the superior court stating the amount of their claimed interest and an affirmation or denial of the prosecuting agency’s allegation. The notice shall set forth the time within which a claim of interest in the property seized is required to be filed. (b) If the property alleged to be subject to forfeiture is real property, the prosecuting agency shall, at the time of filing the petition of forfeiture, record a lis pendens in each county in which the real property is situated which specifically identifies the property by legal description, the name of the owner of record as shown on the latest equalized assessment roll, and assessor’s parcel number. The judgment of forfeiture shall not affect the interest in real property of any third party which was acquired prior to the recording of the lis pendens. (c) If a petition of forfeiture is filed pursuant to this section prior to filing of the complaint in a criminal action, the prosecuting agency shall provide concurrent notice to any parties subject to the proposed forfeiture that they are targets of an anticipated criminal action. (d) If a petition of forfeiture is filed pursuant to this section prior to the filing of a complaint in a criminal action, the petition and any injunctive order shall be dismissed by operation of law, unless a criminal complaint or grand jury indictment is filed within 120 days after the filing of the petition. If a petition is dismissed pursuant to this section, it shall not be refiled, except upon the filing of a criminal complaint or grand jury indictment. (Amended by Stats. 1992, Ch. 1280, Sec. 2. Effective January 1, 1993.)
  17. 5322.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Criminal Forfeiture [5320 - 5325] ( Article 5 added by Stats. 1990, Ch. 1118, Sec. 20. )

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    A claimant to seized property may file a verified claim in court within 30 days and must give a copy to the Attorney General or district attorney.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Criminal Forfeiture [5320 - 5325] ( Article 5 added by Stats. 1990, Ch. 1118, Sec. 20. ) ## 5322. (a) Any person claiming an interest in the property may, at any time within 30 days from the date of the first publication of the notice of seizure, or within 30 days after receipt of actual notice, file with the superior court of the county in which the action is pending a verified claim stating his or her interest in the property or proceeds. A verified copy of the claim shall be given by the claimant to the Attorney General or district attorney, as appropriate. (b) (1) If, at the end of the time set forth in subdivision (a), an interested person, other than the defendant, has not filed a claim, the court, upon motion, shall declare that the person has defaulted upon his or her alleged interest, and it shall be subject to forfeiture upon proof of the provisions of subdivision (d). (2) The defendant may admit or deny that the property is subject to forfeiture pursuant to the provisions of this article. If the defendant fails to admit or deny or to file a claim of interest in the property or proceeds, the court shall enter a response of denial on behalf of the defendant. (c) (1) The forfeiture proceeding shall be set for hearing in the superior court in which the underlying criminal offense will be tried. (2) If the defendant is found guilty of the underlying offense, the issue of forfeiture shall be promptly tried, either before the same jury or before a new jury in the discretion of the court, unless waived by the consent of all parties. (d) At the forfeiture hearing, the prosecuting agency shall have the burden of establishing beyond a reasonable doubt that the defendant was engaged in actions in violation of Sections 5303, 5304, 5305, and 5306 and that the property specified in the petition otherwise meets the criteria for forfeiture under Section 5320. If a jury is the trier of fact, the verdict shall be unanimous in order to impose the forfeiture. (Added by Stats. 1990, Ch. 1118, Sec. 20.)
  18. 5323.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Criminal Forfeiture [5320 - 5325] ( Article 5 added by Stats. 1990, Ch. 1118, Sec. 20. )

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    A prosecuting agency may ask the superior court for temporary orders to freeze or manage forfeiture property, but the court must give notice and hold a hearing before granting a preliminary injunction or receiver, and it cannot block payment of criminal defense fees.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Criminal Forfeiture [5320 - 5325] ( Article 5 added by Stats. 1990, Ch. 1118, Sec. 20. ) ## 5323. (a) Concurrent with, or subsequent to, the filing of the petition, the prosecuting agency may move the superior court for the following pendente lite orders to preserve the status quo of the property alleged in the petition of forfeiture: (1) An injunction to restrain all interested parties and enjoin them from transferring, encumbering, hypothecating or otherwise disposing of that property. (2) Appointment of a receiver to take possession of, care for, manage, and operate the assets and properties so that such property may be maintained and preserved. (b) No preliminary injunction may be granted or receiver appointed without notice, that meets the requirements of Section 5321, to all the interested parties, including actual notice to targets of the anticipated criminal action, and a hearing to determine that such an order is necessary to preserve the property, pending the outcome of the criminal proceedings, and that there is probable cause to believe that the property alleged in the forfeiture proceedings are proceeds or property interests forfeitable under Section 5320. However, a temporary restraining order may issue pending that hearing pursuant to the provisions of Section 527 of the Code of Civil Procedure. (1) In determining whether to issue a preliminary injunction or temporary restraining order in a proceeding brought by a prosecuting agency in conjunction with or subsequent to the underlying criminal proceeding, the court shall weigh the relative degree of certainty of the outcome on the merits and the consequences to each of the parties of granting the interim relief. If the prosecution is likely to prevail on the merits and the potential harm to the public outweighs the potential harm to the defendants and the interested parties, the court should grant injunctive relief. The court shall give significant weight to the following factors: (A) The public interest in preserving liquid capital and other financial assets pendente lite. (B) The difficulty of preserving financial assets pendente lite where the underlying alleged crimes involve issues of fraud and moral turpitude. (C) The fact that the requested relief is being sought by a public prosecutor on behalf of alleged victims of financial crimes. (D) The likelihood that substantial public harm has occurred where financial crimes are alleged to have been committed. (2) In determining whether to issue a permanent injunction or temporary restraining order in a proceeding brought by a prosecuting agency before the filing of a complaint in the underlying criminal proceeding, the court shall weigh the relative degree of certainty of the outcome on the merits and the consequences to each of the parties of granting the interim relief. (3) No injunctive order issued under this section shall impair the ability of a defendant or interested party to pay the actual legal fees or retainer for his or her legal defense to the criminal charges and the petition for forfeiture. (c) Notwithstanding any other provision of law, the court in granting these motions may order a surety bond or undertaking to preserve the property interests of the interested parties, but the court shall give significant weight to the unique circumstances of public agencies, as opposed to private litigants, in determining whether to order a surety bond or undertaking. (d) The court shall, in making its orders, seek to protect the interests of those who may be involved in the same enterprise as the defendant, but who were not involved in the commission of the violation of a crime enumerated in Section 5320. (Amended by Stats. 1992, Ch. 1280, Sec. 3. Effective January 1, 1993.)
  19. 5324.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Criminal Forfeiture [5320 - 5325] ( Article 5 added by Stats. 1990, Ch. 1118, Sec. 20. )

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    This section tells the court to forfeit certain property or proceeds to the state or local government if the property is found forfeitable, and it sets rules for secured interests and public sale.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Criminal Forfeiture [5320 - 5325] ( Article 5 added by Stats. 1990, Ch. 1118, Sec. 20. ) ## 5324. (a) If the trier of fact at the forfeiture hearing finds that the alleged property or proceeds is forfeitable pursuant to Section 5320, the court shall declare that property or proceeds forfeited to the state or local governmental entity, subject to distribution as provided in Section 5325. No property solely owned by a bona fide purchaser for value shall be subject to forfeiture. (b) If the trier of fact at the forfeiture hearing finds that the alleged property is forfeitable pursuant to Section 5320, but does not find that a person holding a valid lien, mortgage, security interest, or interest under a conditional sales contract acquired that interest with actual knowledge that the property was to be used for a purpose for which forfeiture is permitted, and the amount due to that person is less than the appraised value of the property, that person may pay to the state or the local governmental entity which initiated the forfeiture proceeding, the amount of the difference between the appraised value of the property and the amount of the lien, mortgage, security interest, or interest under a conditional sales contract. Upon that payment, the state or local governmental entity shall relinquish all claims to the property. If the holder of the interest elects not to make that payment to the state or local governmental entity, the property shall be deemed forfeited to the state or local governmental entity and any indicia of ownership of the property shall be forwarded. The appraised value shall be determined as of the date judgment is entered either (a) by agreement between the holder of the lien, mortgage, security interest, or interest under a conditional sales contract and the governmental entity involved or (b) if they cannot agree, then by a court-appointed appraiser for the county in which the action is brought. A person holding a valid lien, mortgage, security interest, or interest under a conditional sales contract shall be paid the appraised value of his or her interest. (c) If the amount due to a person holding a valid lien, mortgage, security interest, or interest under a conditional sales contract is less than the value of the property and the person elects not to make payment to the governmental entity, the property shall be sold at public auction by the county if the district attorney is the prosecutor, by the city if the city attorney is the prosecutor, or by the Department of General Services if the Attorney General is the prosecutor. Notice of the sale shall be provided by one publication in a newspaper published and circulated in the city, community, or locality where the sale is to take place. (Added by Stats. 1990, Ch. 1118, Sec. 20.)
  20. 5325.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Criminal Forfeiture [5320 - 5325] ( Article 5 added by Stats. 1990, Ch. 1118, Sec. 20. )

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    Forfeited money or sale proceeds must be distributed first to protected purchasers and lienholders, then to certain crime victims, with remaining funds going to the general fund.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Criminal Forfeiture [5320 - 5325] ( Article 5 added by Stats. 1990, Ch. 1118, Sec. 20. ) ## 5325. Notwithstanding that no response or claim has been filed pursuant to Section 5322, in all cases where property is forfeited pursuant to this article and, where necessary, sold by the Department of General Services or local governmental entity, the money forfeited or the proceeds of sale shall be distributed by the state or local governmental entity as follows: (a) To the bona fide or innocent purchaser, conditional sales vendor, or holder of a valid lien, mortgage or security interest, if any, and from the balance of any forfeited funds to any victim of a crime enumerated in Section 5320 committed by the defendant, up to the amount of his or her interest in the property or proceeds, when the court declaring the forfeiture orders a distribution to that person. The court shall endeavor to discover all such lienholders and protect their interests and may, at its discretion, order the proceeds placed in escrow for up to an additional 60 days to ensure that all valid claims are received and processed. The aggregate of all money distributed pursuant to this subdivision and all money received pursuant to a restitution order of a court shall not exceed the amount of the person’s interest in the property or proceeds. (b) To the Department of General Services or local governmental entity for all expenditures made or incurred by it in connection with the sale of the property, including expenditures for any necessary repairs, storage, or transportation of any property seized under this article. (c) The balance of forfeiture funds remaining after the obligations in subdivisions (a) and (b) have been satisfied shall be paid to the general fund of the state or local governmental entity, whichever prosecutes. (Amended by Stats. 1992, Ch. 1280, Sec. 4. Effective January 1, 1993.)
  21. 5330.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Civil Penalties [5330- 5330.] ( Article 6 added by Stats. 1990, Ch. 1118, Sec. 21. )

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    The commissioner may impose civil penalties on savings associations and institution-affiliated parties for listed violations, unsafe practices, fiduciary breaches, and related misconduct.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 1. Short Title, General Definitions, and General Provisions [5000 - 5330] ( Chapter 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Civil Penalties [5330- 5330.] ( Article 6 added by Stats. 1990, Ch. 1118, Sec. 21. ) ## 5330. The commissioner may impose civil penalties on any savings association, and any institution-affiliated party as follows: (a) Except as provided in subdivision (b) or in subdivisions (c) and (d), any savings association which, and any institution-affiliated party who, commits any of the following violations shall forfeit and pay a civil penalty of not more than five thousand dollars ($5,000) for each day during which the violation continues: (1) Violation of any statute or regulation. (2) Violation of any order issued by the commissioner. (3) Violation of any condition imposed in writing by the commissioner in connection with the grant of any application or other request by the savings association. (4) Violation of any written agreement between the savings association and the commissioner. (b) Any savings association which, and any institution-affiliated party who, (1) commits any violation specified in subdivision (a), (2) recklessly engages in an unsafe or unsound practice in conducting the affairs of the savings association, or (3) breaches any fiduciary duty shall forfeit and pay a civil penalty of not more than twenty-five thousand dollars ($25,000) for each day during which the violation, practice, or breach continues if the violation, practice, or breach (1) is part of a pattern of misconduct, (2) causes or is likely to cause more than a minimal loss to the savings association, or (3), was committed by an institution-affiliated party and results in pecuniary gain or other benefit to that institution-affiliated party. (c) Notwithstanding subdivisions (a) and (b), any savings association which, and any institution-affiliated party who, (1) knowingly commits any violation specified in subdivision (a), engages in any unsafe or unsound practice in conducting the affairs of the savings association, or breaches any fiduciary duty, and (2) knowingly or recklessly causes a substantial loss to the savings association or, in the case of an institution-related party, a substantial pecuniary gain or other benefit to the institution-related party results by reason of violation, practice or breach, shall forfeit and pay a civil penalty in an amount not to exceed the maximum amount determined under this subdivision for each day during which the violation, practice, or breach continues. The maximum daily amount of any civil penalty which may be assessed pursuant to this subdivision for any violation, practice, or breach described in the subdivision is as follows: (1) In the case of any person other than a savings association, an amount not to exceed one million dollars ($1,000,000). (2) In the case of any savings institution, an amount not to exceed the lesser of one million dollars ($1,000,000) or 1 percent of the total assets of the association. (d) (1) Any penalty imposed under subdivisions (a), (b), or (c) may be assessed and collected by the commissioner by written notice. (2) If, with respect to any assessment under paragraph (1) a hearing is not requested pursuant to subdivision (g) within the period of time allowed under subdivision (g), the assessment shall constitute a final and unappealable order. (e) The commissioner may compromise, modify or remit any penalty which may be assessed or which has been assessed pursuant to subdivision (a), (b), or (c). (f) In determining the amount of any penalty imposed under subdivision (a), (b), or (c), the commissioner shall take into account the appropriateness of the penalty with respect to all of the following: (1) The size of financial resources and good faith of the savings association or other person charged. (2) The gravity of the violation, practice, or breach. (3) The history of previous violations, unsafe or unsound practices, or breaches of fiduciary duty. (4) Such other matters as justice may require. (g) The savings association or other person against whom any penalty is assessed under this section shall be afforded a departmental hearing if the association or person submits a request for a hearing within 20 days after the issuance of the notice of assessment. (h) (1) If any savings association or institution-related party fails to pay an assessment after any civil monetary penalty assessed under this section has become final, the department shall recover the amount assessed by action in superior court. (2) Notwithstanding any other provision of law, review under Section 8055 of the validity or appropriateness of any civil penalty assessed under this section shall be conducted solely pursuant to Section 1085 of the Code of Civil Procedure. (i) All penalties collected under authority of this section shall be deposited in the Savings and Loan Account in the Financial Institutions Fund. (Amended by Stats. 1996, Ch. 1064, Sec. 550. Effective January 1, 1997. Operative July 1, 1997.)
  22. 5400.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 1. Organizing Permit [5400 - 5403] ( Article 1 added by Stats. 1983, Ch. 1091, Sec. 2. )

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    Funds from proposed stockholders, members, or organizers of a proposed association cannot be collected until a verified organizing-permit application is filed and the commissioner issues a permit; collections must also follow the permit’s terms.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 1. Organizing Permit [5400 - 5403] ( Article 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5400. (a) No funds from proposed stockholders, members, or organizers of any proposed association may be collected until a verified application for an organizing permit has been filed and a permit has been issued by the commissioner authorizing collection of funds, and then only in accordance with the terms of the permit. (b) As used in this chapter, the term “organizer” means a person who agrees to contribute funds to a proposed association to be used for its organization expenses. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  23. 5401.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 1. Organizing Permit [5400 - 5403] ( Article 1 added by Stats. 1983, Ch. 1091, Sec. 2. )

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    An organizing permit application must be written, filed with the commissioner, signed and verified by the chairman of the organizers, and include specified information and documents.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 1. Organizing Permit [5400 - 5403] ( Article 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5401. The application for an organizing permit shall be in writing and shall be filed in the office of the commissioner. The application shall be executed and verified by the chairman of the organizers, who shall be elected by a majority vote of the organizers, and shall include the following: (a) The names and addresses of the organizers of the proposed association and, to the extent known, its proposed directors and officers, together with the proposed amount of capital stock and savings accounts to be purchased and funds for organization expenses to be contributed by each. (b) The proposed location of its office. (c) A copy of any contract proposed to be used for the solicitation of subscriptions for stock and savings accounts and funds for its organization expenses. (d) A copy of any advertisement, circular, or other written matter proposed to be used for soliciting stock and savings accounts subscriptions and funds for organization expenses. (e) An itemized estimate of the organization expenses proposed to be incurred. (f) A copy of the certificate of reservation of name issued under Section 5403. The name selected shall conform with the requirements of Article 4 (commencing with Section 5650). (g) Any additional information that the commissioner may require by written instructions. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  24. 5402.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 1. Organizing Permit [5400 - 5403] ( Article 1 added by Stats. 1983, Ch. 1091, Sec. 2. )

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    The commissioner may set conditions in an organizing permit, including rules about escrowed funds, how the funds are spent, and other reasonable conditions to protect the public, subscribers, and organizers.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 1. Organizing Permit [5400 - 5403] ( Article 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5402. (a) The commissioner may impose conditions in an organizing permit concerning the deposit in escrow of funds collected pursuant to the permit, the manner of expenditure of the funds, and any other conditions deemed reasonable and necessary or advisable for the protection of the public, the subscribers, and the organizers. (b) Contributions of organization expenses may be repaid to organizers on a pro rata basis by the association in amounts not to exceed its net income from operations after provision for statutory reserves. (Amended by Stats. 1984, Ch. 287, Sec. 3. Effective July 6, 1984.)
  25. 5403.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 1. Organizing Permit [5400 - 5403] ( Article 1 added by Stats. 1983, Ch. 1091, Sec. 2. )

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    An organizer must first file a name-reservation application with the Secretary of State before applying for an organizing permit, and the Secretary of State must issue the reservation certificate when any required fee is paid.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 1. Organizing Permit [5400 - 5403] ( Article 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5403. (a) Before filing an application for an organizing permit with the commissioner under Section 5400, an organizer shall file with the Secretary of State an application for a certificate of a reservation of the name for the proposed association in accordance with the provisions of Article 5 (commencing with Section 5650). (b) The application filed with the Secretary of State shall recite the fact of the application to be filed under Section 5400 and the Secretary of State shall issue a certificate of reservation of name upon payment of any required fee. (c) Notwithstanding the provisions of subdivision (c) of Section 201 of the Corporations Code, the name contained in the certificate of reservation of the name shall be reserved to the applicant until (1) the commissioner denies the petition for a certificate of authority, or (2) if a certificate of approval of articles of incorporation is issued, as long as it continues in effect, or (3) for a period of up to one year from the date when the certificate of reservation of the name is issued, whichever of these occurs first. (d) The Secretary of State may, upon the request of the applicant and the approval of the commissioner, extend the reservation of the name for an additional six months. (Amended by Stats. 1984, Ch. 868, Sec. 4.)
  26. 550.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [550 - 554] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    This section defines several terms used in the article, including “customer,” “subject institution,” “subject person,” and “violation.”

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [550 - 554] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 550. In this article: (a) “Appropriate licensee business” means the business that a licensee may conduct in accordance with the charter or license that the commissioner has issued to that licensee. (b) “Customer” means a depositor of a bank, a member of a credit union, or a customer of any other licensee. (c) “Holding company” shall have the meaning set forth in Section 1280. (d) “Officer of a subject institution” means any director, officer, official, or employee of the subject institution. (e) “Person” means a subject institution or a subject person. (f) “Subject institution” means any of the following: (1) Licensee. (2) Subsidiary of a licensee. (3) Foreign (other state) or foreign (other nation) bank or credit union that maintains an office in this state, with respect to any such office other than a national bank or federal credit union. (4) Any other person lawfully conducting the business of a bank or credit union in this state other than a national bank or federal credit union. (g) “Subject person,” when used with respect to a subject institution, means any of the following: (1) Director, officer, employee, or agent of the subject institution. (2) Member, consultant, joint venture partner, or other person that participates in the affairs of a subject institution. (3) Independent contractor, including any attorney, appraiser, or accountant, who knowingly or recklessly participates in any of the following acts if the act caused or is likely to cause more than a minimal financial loss to, or a significant adverse effect on, the subject institution: (A) A violation of any applicable law, regulation, or order. (B) A breach of fiduciary duty. (C) An unsafe or unsound act. (h) “Violation” includes any act performed, alone or with other persons, for or toward causing, bringing about, participating in, counseling, aiding, or abetting a violation of any applicable statute, regulation, provision of a written order issued by the commissioner, or provision of a written agreement made between the commissioner and a subject institution or subject person. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  27. 5500.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 2. Petition for Certificate of Authority [5500 - 5506] ( Article 2 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    A person may ask to form a capital stock or mutual association within 60 days after an organizing permit is issued, but the filing must include specified petition materials, proposed bylaws, and any required fee or additional information requested by the commissioner.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 2. Petition for Certificate of Authority [5500 - 5506] ( Article 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5500. Within 60 days after issuance of an organizing permit under Article 1 (commencing with Section 5400) any person may request authority to form a capital stock or mutual association by filing with the commissioner three copies of a petition for a certificate of authority and proposed articles of incorporation. The petition shall also be accompanied by three copies of proposed bylaws which shall make provisions for the following: (a) Annual and special meetings of members or stockholders, and notice of meetings. (b) Procedure for nomination of directors. (c) Meetings of board of directors. (d) Resignation and removal of directors. (e) Compensation of directors. (f) Officers. (g) Execution of instruments. (h) Evidence of savings accounts. (i) Corporate seal. (j) Fiscal year. (k) Amendments. (l) Disaster preparedness. (m) Other matters, if any. The petitioners shall submit with their petitions any applicable filing fee prescribed under Section 9001 and any statements, exhibits, maps, and other data that the commissioner may require by written instruction in a form which is sufficiently detailed and comprehensive to enable the commissioner to make a decision on the petition based on the criteria set out in Section 5502. (Amended by Stats. 1988, Ch. 718, Sec. 1.5.)
  28. 5501.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 2. Petition for Certificate of Authority [5500 - 5506] ( Article 2 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    When a petition for a certificate of authority is received, the commissioner must give written notice to each association, and any hearing must be scheduled within the stated timing rules.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 2. Petition for Certificate of Authority [5500 - 5506] ( Article 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5501. Upon receipt of a petition for a certificate of authority, the commissioner shall give written notice to each association that a petition for the issuance of a certificate has been made. The notice shall state the name of the proposed association, where the petitioners propose to establish the home office of the association, and if the commissioner determines that a hearing is to be held on the petition, the time and place of the hearing. The hearing shall be held 10 or more days after the mailing of the notice but in no event later than 60 days after the mailing of the notice. Any interested person may appear at the hearing in person or by agent or attorney, and orally or in writing show cause upon any relevant ground why a certificate should not be issued. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  29. 5501.5.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 2. Petition for Certificate of Authority [5500 - 5506] ( Article 2 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Certain domestic associations incorporated after January 1, 1984 must put specified purpose statements in their articles of incorporation.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 2. Petition for Certificate of Authority [5500 - 5506] ( Article 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5501.5. The articles of incorporation of each domestic association incorporated after January 1, 1984, shall include a statement that it is formed for each of the following purposes: (a) To engage primarily in the specific business of a savings association and any other lawful activities not prohibited to a savings association by applicable laws and regulations. (b) To encourage industry, frugality, home building, and the accumulation of savings. That statement shall add either “among its members” or “among its savings account holders” and may also add “and among others.” (c) For the loaning of the money accumulated, with the interest and earnings thereon. The statement shall add either “to its members” or “to its savings account holders” and the statement may also add “and to others.” (d) For the repayment subject to the provisions of this division and any act amendatory thereof or supplementary thereto of the savings and interest to each savings account holder whenever the savings account holder desires to withdraw the same, or when the association desires to repay the same. (e) In the case of a stock association, for the purpose of issuing capital stock and savings accounts. (f) In the case of a mutual association, for the purpose of accumulating capital by the issuance of savings accounts and to grant holders of savings accounts the right to be a member of the association with entitlement to one vote for each one hundred dollars ($100) of the withdrawal value of each savings account to be voted in person or by proxy to transact the business of the association. (g) For any and all purposes specified in the Savings Association Law with all the rights, powers, privileges and immunities as set forth in that law. The above provisions are in lieu of paragraph (1) of subdivision (b) of Section 202 of the Corporations Code and may be supplemented or modified with such provisions as the commissioner may approve. (Amended by Stats. 1988, Ch. 718, Sec. 2.)
  30. 5502.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 2. Petition for Certificate of Authority [5500 - 5506] ( Article 2 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    The commissioner may approve a petition for a certificate of authority only if the required prerequisites are met.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 2. Petition for Certificate of Authority [5500 - 5506] ( Article 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5502. The commissioner shall not approve any petition for certificate of authority unless it is found from the data furnished with the petition, the evidence adduced at the hearing, if one is held, and official records, that the prerequisites of this division have been complied with and that: (a) The character, responsibility, financial resources, and general fitness of the persons named in the petition warrant belief that the business of the proposed association will be honestly and efficiently conducted in accordance with the intent and purpose of this division and that the proposed association will have qualified full-time management. (b) There is a public need for the proposed association and the business plan, and the anticipated volume of business of the proposed association indicates a profitable operation. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  31. 5503.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 2. Petition for Certificate of Authority [5500 - 5506] ( Article 2 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    The commissioner must decide a petition for a certificate of authority within a reasonable time, and if approved must issue the required approvals and certificate; if denied, the petitioner may request the statutory reason and must stop using the reserved name.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 2. Petition for Certificate of Authority [5500 - 5506] ( Article 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5503. (a) The commissioner shall, within a reasonable time after the petition is filed, or within a reasonable time after the hearing, if one is held, either approve or deny the petition for a certificate of authority. (b) If approved, the commissioner shall issue a certificate of approval of the articles of incorporation of the association and shall issue a notice of conditional approval of the petition for a certificate of authority. Upon satisfaction of all of the conditions in the notice, the commissioner shall execute and issue to the association a certificate of authority. (c) If denied, upon written request of any petitioner, the commissioner shall provide the statutory reason for denial. Denial of the petition is a final decision and the petitioner shall not be entitled to any further administrative remedy. The petitioner shall discontinue the use of the reserved name and provide evidence to the commissioner that the Secretary of State has been notified to release the name reservation. (Amended by Stats. 1987, Ch. 730, Sec. 2.)
  32. 5504.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 2. Petition for Certificate of Authority [5500 - 5506] ( Article 2 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    The commissioner must attach and deliver the approval papers to the proposed association, and the association may not open its office for public business before the certificate of authority is issued.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 2. Petition for Certificate of Authority [5500 - 5506] ( Article 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5504. Upon issuance of a certificate of approval of articles of incorporation to a proposed association, the commissioner shall attach the original signed copy of the certificate of approval to the original signed copy of the articles and deliver it to the proposed association for filing with the Secretary of State. Corporate existence shall begin on the date of filing of the articles with the Secretary of State. Prior to the date the commissioner issues the association a certificate of authority, the activities of the association shall be limited to completing its organization activities and the association shall not open its office for transacting business with the public. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  33. 5505.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 2. Petition for Certificate of Authority [5500 - 5506] ( Article 2 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    A proposed association cannot file its articles of incorporation with the Secretary of State unless a commissioner-issued certificate of approval is attached.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 2. Petition for Certificate of Authority [5500 - 5506] ( Article 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5505. The articles of incorporation of a proposed association shall not be filed in the office of the Secretary of State unless a certificate of approval of the articles of incorporation issued by the commissioner is attached thereto. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  34. 5506.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 2. Petition for Certificate of Authority [5500 - 5506] ( Article 2 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    After an association’s corporate existence begins, its directors must hold an organization meeting within 30 days and elect officers.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 2. Petition for Certificate of Authority [5500 - 5506] ( Article 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5506. Within 30 days after the corporate existence of an association begins, the directors of the association shall hold an organization meeting and shall elect officers pursuant to the provisions of this division and the bylaws. At the organization meeting, the directors shall take any other action that is appropriate in connection with the organization of the association. The commissioner may extend by order the time within which the organization meeting shall be held. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  35. 551.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [550 - 554] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    A subject person entitled to a hearing may waive that right at any time.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [550 - 554] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 551. Any subject person who is entitled to a hearing pursuant to this article may waive that right at any time. A waiver under this section shall relieve the commissioner from having to issue a formal notice of hearing that would otherwise be required by this article. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  36. 552.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [550 - 554] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    A person subject to an order may ask the commissioner for a hearing within 30 days, and the commissioner must act within set time limits or the order is rescinded.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [550 - 554] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 552. (a) Within 30 days after an order is issued pursuant to Section 567, 581, 582, 586, or 591, or subdivision (c) of Section 587, the person to whom the order is issued may file with the commissioner an application for a hearing on the order. (b) If the commissioner fails to commence the hearing within 15 business days after the application is filed with the commissioner or within any longer period to which the person subject to the order consents, the order shall be deemed rescinded. (c) Within 30 days after the hearing, or within any longer period to which the person consents, the commissioner shall affirm, modify, or rescind the order. If the commissioner fails to affirm, modify, or rescind the order within that time limit, the order shall be deemed rescinded. (d) The right to petition for judicial review of the order shall not be affected by the failure of the person subject to the order to apply to the commissioner for a hearing on the order pursuant to subdivision (a). (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  37. 553.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [550 - 554] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    The commissioner may issue certain enforcement orders that require the affected person to take remedial actions such as restitution, correcting violations, disposing of assets, hiring qualified staff, or limiting activities.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [550 - 554] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 553. In addition to any other action or requirement the commissioner deems necessary or advisable, an order issued pursuant to Section 580, 581, 582, 585, 586, or 587 may require the person subject to the order to do any of the following: (a) Make restitution or provide reimbursement, indemnification, or guarantee against loss, if the subject institution, subject person, or holding company was unjustly enriched by the action or violation or if the action or violation involved a reckless disregard for any provision of this division, of any regulation or order issued under this division, of any other applicable law, or of any agreement with the commissioner. (b) Restrict the growth of the subject institution. (c) Dispose of any loan or other asset. (d) Correct violations of law. (e) Employ qualified officers or employees, who may be subject to approval of the commissioner. (f) Limit the activities or functions of the subject institution, subject person, or holding company. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  38. 554.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [550 - 554] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    If the commissioner takes action without prior notice or hearing, the commissioner must promptly give a written order explaining the basis for the action.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [550 - 554] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 554. If the commissioner takes possession of a subject institution without a prior notice or hearing, or takes action against a subject person without prior notice or hearing, the commissioner shall, upon taking possession or taking that action, concurrently provide to the subject institution or subject person a written order. The order shall set forth the condition or conditions of the subject institution or action or actions of the subject person that constitute the basis or bases for the commissioner’s action. In any case where the commissioner takes possession of a subject institution, the commissioner shall establish, by clear evidence, the basis for his or her action. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  39. 560.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Actions Involving the Conduct of Business by Unauthorized Persons [560 - 567] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    A person without a commissioner certificate authorizing banking business may not take deposits, issue deposit certificates, make check payments, or operate like a bank or trust company.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Actions Involving the Conduct of Business by Unauthorized Persons [560 - 567] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 560. No person who has not received a certificate from the commissioner authorizing it to engage in the banking business shall solicit or receive deposits, issue certificates of deposit with or without provision for interest, make payments on checks, or transact business in the way or manner of a bank or trust company. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  40. 5600.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    The board of directors of an association being organized must choose a California financial institution to hold subscription funds, and that institution must safeguard and later deliver the funds under the stated conditions.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5600. (a) The board of directors of an association which is in the process of organization shall select a financial institution within this state as a depository for stock, savings account and mutual capital certificate subscription funds. (b) The financial institution shall assure the safekeeping of the subscription funds and the delivery of these funds to the association after the issuance of the certificate of authority and after the bonding of the officers. In the event of the failure to complete the organization of the association and to commence business, the financial institution shall insure the return of the amounts collected to the respective subscribers or their assigns, plus any earnings on the funds, less reasonable charges of the financial institution for services as depository of the funds. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  41. 5601.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Before a certificate of authority is issued, the association must pay its capital into the association, and the commissioner sets the minimum required capital by regulation or instruction.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5601. Before a certificate of authority is issued, the capital of the association shall be paid into the association and, in the case of stock, shall be the sum of the par or initially stated value of all shares of capital stock, plus the initial paid-in surplus. The minimum required capital shall be established by regulations, or instructions, issued by the commissioner. (Amended by Stats. 1984, Ch. 287, Sec. 3.5. Effective July 6, 1984.)
  42. 5602.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    The commissioner may require extra paid-in surplus for capital stock, and the board of directors may allow other uses of minimum capital and surplus, so long as subscribed stock value stays the association’s permanent capital.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5602. In addition to the minimum capital required, the commissioner may require that the consideration for the issuance of capital stock shall be sufficient to create a paid-in surplus in an amount satisfactory to the commissioner. The minimum capital and surplus may be used for the reserves required by law and for other purposes as may be permitted by the board of directors, provided that the par value or stated value of the stock subscribed shall be maintained as the permanent capital of the association, as required by Sections 5604 and 5605. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  43. 5603.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    A stock association must file a statement with the commissioner before a certificate of authority is issued.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5603. In the case of a stock association, prior to issuance of a certificate of authority, the association shall file with the commissioner a statement in a form and with supporting data and proof that the commissioner may require, that verifies that the entire capital and paid-in surplus has been unconditionally paid in, that these funds are on deposit with the depository financial institution, and that all conditions contained in the notice of conditional approval of the petition for a certificate of authority have been met. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  44. 5604.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    A stock association must issue the capital stock needed to meet minimum capital requirements, and it may not issue extra shares except as authorized. Issued capital stock is permanent capital and generally cannot be retired or withdrawn until liabilities are fully satisfied and outstanding capital certificates are retired.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5604. (a) In the case of a stock association, on or after the date the commissioner issues the association a certificate of authority, the association shall issue the capital stock necessary to satisfy the minimum capital requirements of Section 5601 and any additional capital stock approved for issuance by its board of directors, up to the amount authorized in its articles of incorporation, and shall issue no additional shares except as authorized in this division. (b) The capital stock of an association, when issued, shall constitute permanent capital and shall not be retired or withdrawn except as provided in this division until all liabilities of the association have been satisfied in full, including the withdrawal value of all savings accounts, and until outstanding capital certificates have been retired. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  45. 5605.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    An association must begin business within one year after its certificate of approval is issued, unless the commissioner approves more time first.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5605. (a) Any association that does not commence business within one year after the date of the issuance of its certificate of approval of articles of incorporation shall forfeit its certificate of approval of articles of incorporation, unless the commissioner, before the expiration of the one year period, shall have approved the extension of time within which it may commence business, upon a written application stating the reasons for delay. Upon forfeiture, the association’s certificate of approval of articles of incorporation shall expire. Amounts credited on savings accounts or paid in on capital stock, including any income earned on these funds, shall be returned on a pro rata basis to their respective subscribers. (b) The commissioner shall immediately notify the Secretary of State of forfeiture under this section. (Amended by Stats. 1986, Ch. 361, Sec. 3.)
  46. 5606.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Associations must have FDIC insurance for their savings accounts before doing business in the state; foreign savings associations must also maintain that insurance.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5606. (a) Prior to doing business in this state, an association shall obtain and maintain insurance of its savings accounts by the Federal Deposit Insurance Corporation. (b) Prior to doing business in this state, a foreign savings association, as defined in Sections 10000 and 10010, shall maintain insurance of its savings accounts by the Federal Deposit Insurance Corporation. (c) The commissioner may enforce any statutes pertaining to, or any regulations of, the Federal Deposit Insurance Corporation or the Office of Thrift Supervision insofar as those statutes and regulations apply to associations, and may enforce any and all other federal statutes and regulations applicable to associations. (Amended by Stats. 1990, Ch. 1118, Sec. 22.)
  47. 561.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Actions Involving the Conduct of Business by Unauthorized Persons [560 - 567] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    A person without a commissioner’s certificate to do banking must not advertise banking activities or present its business as a bank or trust company, unless expressly authorized by this division.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Actions Involving the Conduct of Business by Unauthorized Persons [560 - 567] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 561. No person who has not received a certificate from the commissioner authorizing it to engage in the banking business shall advertise that it is accepting deposits, and issuing notes or certificates therefore, or make use of any office sign, at the place where its business is transacted, having thereon any artificial or corporate name, or other words indicating that the place or office is the place or office of a bank or trust company, that deposits are received there or payments made on checks, or any other form of banking business is transacted, nor shall any person make use of or circulate any letterheads, billheads, blank notes, blank receipts, certificates, or circulars, or any written or printed paper, whatever, having thereon any artificial or corporate name or other words indicating that the business is the business of a bank or trust company, or transact business in a way or manner as to lead the public to believe that its business is that of a bank or trust company, except to the extent expressly authorized by this division. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  48. 5612.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    This section defines “security” for this article.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5612. For the purposes of this article, “security” means any stock, subordinated debenture, warrant, or right or option to purchase any stock issued by an association. (Added by Stats. 1988, Ch. 718, Sec. 4.)
  49. 5613.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    An association generally cannot sell or issue its securities until it gets a permit from the commissioner.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5613. (a) No association shall sell, except upon a sale for a delinquent assessment made in accordance with the provisions of the General Corporation Law, or offer for sale, or take subscriptions for, or issue any of its securities (except stock dividends), until the association has applied for and obtained from the commissioner a permit authorizing it to offer, sell or issue that security. (b) Notwithstanding subdivision (a), an association may enter into agreements for the sale of securities with accredited investors (as defined in Section 230. 215 of the Securities Exchange Commission regulations) or persons approved by the commissioner prior to obtaining a permit pursuant to subdivision (a). (c) The commissioner may, by regulation, instruction, or order exclude certain transactions from the operation of this section. (Amended by Stats. 1988, Ch. 718, Sec. 5.)
  50. 5614.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Stock in an association generally cannot be sold or offered to the public, or have subscriptions taken, until the association or the selling stockholders get a permit from the commissioner.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5614. (a) Except as provided in subdivision (b), no issued and outstanding stock of an association shall be sold or offered for sale to the public, nor shall subscriptions be solicited or taken for those sales, until the association or the selling stockholders have applied for and obtained from the commissioner a permit authorizing the sale of the capital stock. (b) Subdivision (a) shall not apply to any of the following: (1) An offering involving less than 10 percent of the issued and outstanding capital stock of an association and less than five hundred thousand dollars ($500,000). (2) An offering made under a registration statement filed under the Securities Act of 1933. (3) Any offering exempted by regulation, instruction, or order issued in writing by the commissioner. (Amended by Stats. 1987, Ch. 730, Sec. 4.)
  51. 5615.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    An association or selling stockholders must file a written, verified application for a permit to sell securities with the commissioner.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5615. An application for a permit to sell securities shall be in writing, verified as provided in the Code of Civil Procedure for the verification of pleadings, and shall be filed in the office of the commissioner by the association or the selling stockholders. The application shall include the following: (a) Regarding the association. (1) The names and addresses of its officers. (2) The location of its office. (3) A balance sheet or statement of its financial condition as of a date within 90 days of the filing date. (4) A copy of all minutes of any proceedings of its directors, shareholders, or stockholders relating to or affecting the issue of such securities. (b) Regarding the offering. (1) A brief description of the method by which the securities are to be offered for sale, including the offering price and the underwriting commissions and expense, if any. (2) A copy of a prospectus or advertisement or other description of the securities prepared for distribution or publication in accordance with requirements prescribed by the commissioner. (3) A copy of any contract concerning the sale of the securities. (4) With respect to any permit issued pursuant to Section 5614, the names and addresses of the selling stockholders and of the officers of any selling corporation and the partners of any selling partnership. (c) Such additional information as the commissioner may require. (d) An application fee as prescribed by the commissioner pursuant to Section 9001. (Amended by Stats. 1988, Ch. 718, Sec. 6.)
  52. 5616.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    After a permit application is filed, the commissioner must review it and may investigate the association; if the plan is fair, just, and equitable, the commissioner must issue a permit, and if not, must deny the application and notify the applicant in writing.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5616. Upon the filing of the application for a permit to sell securities, the commissioner shall examine the application and other papers and documents filed therewith, and he or she may make a detailed examination, audit, and investigation of the association and its affairs. If the commissioner finds that the proposed plan for the issue and sale of such securities is fair, just, and equitable, the commissioner shall issue to the applicant a permit authorizing it to issue and dispose of its securities in such amounts and for such considerations and upon such terms and conditions as the commissioner may provide in the permit. If the commissioner does not so find, the commissioner shall deny the application and notify the applicant in writing of his or her decision. (Amended by Stats. 1988, Ch. 718, Sec. 7.)
  53. 5617.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Every permit to sell securities must state in bold type that the permit is permissive only and is not a recommendation or endorsement of the securities.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5617. Every permit to sell securities shall recite in bold type that the issuance thereof is permissive only and does not constitute a recommendation or endorsement of the securities permitted to be issued. (Amended by Stats. 1988, Ch. 718, Sec. 8.)
  54. 5618.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    The commissioner may change or revoke permits issued by the commissioner, and may temporarily suspend the association’s rights under a permit.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Postincorporation Organization of Associations [5600 - 5618] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5618. The commissioner may amend, alter, or revoke any permit issued by the commissioner, or temporarily suspend the rights of the association under such permit. (Added by Stats. 1984, Ch. 287, Sec. 10. Effective July 6, 1984.)
  55. 562.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Actions Involving the Conduct of Business by Unauthorized Persons [560 - 567] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    Unlicensed persons may not use bank- or trust-related names or advertising, and certain building and loan or savings associations must disclose their type on signs, letterheads, and advertising.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Actions Involving the Conduct of Business by Unauthorized Persons [560 - 567] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 562. No person who has not received a certificate from the commissioner authorizing it to engage in the banking business shall transact business under any name or title that contains the word “bank” or “banker” or “banking” or “industrial bank” or “industrial loan company” or “investment and loan” or “savings bank” or “thrift and loan” or “trust” or “trustee” or “trust company” or act or advertise in any manner that indicates that the business is the business of a bank or trust company. Any building and loan association or savings association having in its corporate name words not clearly indicating the nature of its business shall state, on all signs, letterheads, and advertising matter, “This is a building and loan association” or “This is a savings association” or words to that effect. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  56. 5620.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Issuance of Stock and Certificates [5620 - 5624] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    A stock association may issue common and preferred stock, including stock without par value, and may divide stock into classes and series.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Issuance of Stock and Certificates [5620 - 5624] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5620. (a) A stock association may issue shares of common stock and preferred stock, with or without par value, and common and preferred stock may be divided into classes and the classes into series. (b) Stock associations which have withdrawable shares outstanding as of the effective date of this section may continue to issue savings accounts in that form and the holders of these accounts shall have the same rights as they had before this section became law. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  57. 5621.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Issuance of Stock and Certificates [5620 - 5624] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    A mutual association may amend its articles, with commissioner approval, to authorize and issue stock.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Issuance of Stock and Certificates [5620 - 5624] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5621. (a) With the approval of the commissioner, a mutual association may amend its articles of incorporation to authorize the issuance of stock and may issue stock. Any amendment to the articles of incorporation and bylaws of an association which for the first time authorizes it to issue stock shall be approved by the vote or written assent of a majority of the total votes of members outstanding, except that the amendment shall require approval only of the commissioner and board of directors of an association if the commissioner finds that grounds exist for the appointment of a conservator for the association pursuant to subdivision (a) of Section 8225. (b) An amendment to the articles of incorporation of an association pursuant to this section may include provisions with respect to the surplus, reserves, and undivided profits of the association and in that case the surplus, reserves, and undivided profits shall be retained and disposed of in accordance with those provisions. (c) The corporate existence of a mutual association which amends its articles of incorporation pursuant to this section to authorize the issuance of stock and which issues stock shall continue to be, and the resulting stock association shall be deemed to be, a continuation of the mutual association. The Legislature finds and declares that Section 563b.41 (d)(3) of Title 12 of the Code of Federal Regulations sets forth the law of this state with regard to the continuity of corporate existence in mutual association to stock association conversions and that this section has reflected that law from the time of the original adoption of Section 563b.41 of Title 12 of the Code of Federal Regulations. (Amended by Stats. 1989, Ch. 868, Sec. 2. Effective September 26, 1989.)
  58. 5622.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Issuance of Stock and Certificates [5620 - 5624] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    A stock association must issue capital stock under stated rules, keep stock value as permanent capital, and get commissioner approval for certain reductions, retirements, and stock purchases.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Issuance of Stock and Certificates [5620 - 5624] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5622. Capital stock of a stock association shall be issued pursuant to the following requirements: (a) Except for stock issued pursuant to a stock dividend, stock split, reverse stock split, reclassification of outstanding stock into stock of another class, exchange of outstanding stock for stock of another class or other change affecting outstanding stock or an employee stock option plan or a plan of merger, consolidation, conversion from a mutual to a stock association, or other type of reorganization that has been approved by the commissioner, the consideration for the issuance of capital stock shall be money paid, debts or securities canceled or tangible or intangible property actually received either by the association or by a wholly owned subsidiary. The par value or stated value of stock shall be maintained as the permanent capital of the association and any additional amount paid in shall be credited to paid-in surplus. (b) The aggregate par value or stated value of all outstanding shares of capital stock shall be the permanent capital of the association and except as otherwise specifically provided by this division, capital stock shall not be retired until final liquidation of the association. (c) No association shall reduce the par or stated value of its outstanding capital stock without first obtaining the written approval of the commissioner, and approval shall be withheld if the reduction would cause the par or stated value of outstanding capital stock to be less than the minimum required by this division or would result in less than adequate statutory net worth as the commissioner may determine under Section 6475. (d) No association shall retire any part of its capital stock unless the retirement is approved by the commissioner. (e) No association shall make loans secured by its capital stock. (f) With the written approval of the commissioner, an association may purchase its capital stock or may contract with a stockholder for purchase of stock upon the stockholder’s death. However, the purchase shall not reduce the net worth accounts of the association, or any of them, to an amount less than required by applicable law. An association which agrees with a stockholder to purchase that stockholder’s capital stock upon death may purchase insurance upon the life of the stockholder to fund or partially fund the purchase. (Amended by Stats. 1987, Ch. 1162, Sec. 6. Effective September 26, 1987.)
  59. 5623.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Issuance of Stock and Certificates [5620 - 5624] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    A mutual association may issue mutual capital certificates if it follows the commissioner’s regulations.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Issuance of Stock and Certificates [5620 - 5624] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5623. A mutual association may issue mutual capital certificates in accordance with regulations of the commissioner. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  60. 5624.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Issuance of Stock and Certificates [5620 - 5624] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    An association may issue net worth certificates if it follows applicable regulations of the Office of Thrift Supervision or the Federal Deposit Insurance Corporation.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Issuance of Stock and Certificates [5620 - 5624] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5624. An association may issue net worth certificates in accordance with applicable regulations of the Office of Thrift Supervision or the Federal Deposit Insurance Corporation. (Amended by Stats. 1990, Ch. 1118, Sec. 23.)
  61. 563.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Actions Involving the Conduct of Business by Unauthorized Persons [560 - 567] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    Certain listed banks and corporations may conduct the covered business or activity when another law authorizes it and no other applicable law forbids it.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Actions Involving the Conduct of Business by Unauthorized Persons [560 - 567] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 563. No provision of Section 560, 561, or 562 prohibits any of the following from transacting any business or performing any activity if it is authorized by applicable law to transact the business or perform the activity and is not prohibited by any applicable law, other than Section 560, 561, or 562, from transacting the business or performing the activity: (a) Any California state commercial bank, industrial bank, or trust company. (b) Any national bank. (c) Any insured foreign (other state) state bank. (d) Any foreign (other state) state bank that is licensed by the commissioner under Article 3 (commencing with Section 1700) of Chapter 19 of Division 1.1 to maintain a facility, as defined in Section 1670, in this state. (e) Any foreign (other nation) bank that is licensed by the commissioner under Chapter 20 (commencing with Section 1750) of Division 1.1 to maintain an office in this state. (f) Any foreign (other nation) bank that maintains a federal agency, as defined in subdivision (g) of Section 1750, or federal branch, as defined in subdivision (h) of Section 1750, in this state. (g) Any California state corporation that is incorporated for the purpose of engaging in, and that is authorized by the commissioner to engage in, business under Article 1 (commencing with Section 1850) of Chapter 21 of Division 1.1. (h) Any corporation incorporated under Section 25A of the Federal Reserve Act (12 U.S.C. Sec. 612 et seq.). (i) Any foreign corporation that is licensed by the commissioner under Article 1 (commencing with Section 1850) of Chapter 21 of Division 1.1 to maintain an office in this state and to transact at that office business under Article 1 (commencing with Section 1850) of Chapter 21 of Division 1.1. (j) Any industrial bank that is organized under the laws of another state of the United States and is insured by the Federal Deposit Insurance Corporation. (Amended by Stats. 2013, Ch. 334, Sec. 26. (SB 537) Effective January 1, 2014.)
  62. 564.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Actions Involving the Conduct of Business by Unauthorized Persons [560 - 567] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    A person or bank that violates the earlier sections of this article is liable to the people of the state for $100 per day, or part of a day, while the violation continues.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Actions Involving the Conduct of Business by Unauthorized Persons [560 - 567] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 564. Any person or any bank violating any provision of the foregoing sections of this article shall be liable to the people of the state in the amount of one hundred dollars ($100) per day or part thereof during which that violation continues. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  63. 565.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Actions Involving the Conduct of Business by Unauthorized Persons [560 - 567] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    A person must not mislead others into believing certain securities are legal investments for savings banks unless they actually are.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Actions Involving the Conduct of Business by Unauthorized Persons [560 - 567] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 565. No person shall represent by advertisement, circular, or otherwise, or in any manner mislead anyone to believe, that any securities are legal investments for savings banks in this state or conform to the requirements of law relating to such investments, unless those securities are in fact at that time legal investments for such banks or do in fact so conform. Any person violating the provisions of this section shall be guilty of a misdemeanor and shall be punishable by a fine of not more than one thousand dollars ($1,000) or by imprisonment in a county jail not exceeding one year, or by both such fine and imprisonment. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  64. 5650.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Association Name, Office [5650 - 5655] ( Article 5 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Every association’s name must include specified savings-association wording or another commissioner-approved designation, and any required words must be preceded by commissioner-approved descriptive words.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Association Name, Office [5650 - 5655] ( Article 5 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5650. Notwithstanding the provisions of subdivision (a) of Section 201 of the Corporations Code and Division 1 of the Financial Code, the name of every association shall include either the words “savings association,” “savings and loan association,” “savings bank” or such other designation as the commissioner may approve. These words shall be preceded by an appropriate descriptive word or words approved by the commissioner. (Amended by Stats. 1984, Ch. 868, Sec. 5.)
  65. 5651.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Association Name, Office [5650 - 5655] ( Article 5 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    The commissioner generally may not issue approval for a proposed association name that matches or is too similar to an existing association’s name, and an association may not choose a name that would cause confusion or be unsuitable.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Association Name, Office [5650 - 5655] ( Article 5 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5651. (a) No certificate of approval of articles of incorporation of a proposed association having the same name as an association in existence in this state on the date an application is filed under Section 5401, or a name so nearly resembling it as to be likely to deceive, shall be issued by the commissioner, except to an association formed by the reincorporation, reorganization, or consolidation of the association with other associations, or upon the sale of the property or franchise of an association. The commissioner may presume that the use of any word or words already adopted, appropriated, or used in its corporate name by any association then existing in this state, except the words “the,” “and,” “mutual,” “guarantee,” “building,” “loan,” “savings,” “association,” or “bank,” constitutes such similarity of names as to be likely to mislead the public. (b) An association shall not adopt or change to a name that will result in unfair competition or public confusion, or be deceptive, scandalous, or otherwise unsuitable. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  66. 5652.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Association Name, Office [5650 - 5655] ( Article 5 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    A person may not use restricted savings-association-style names or materials, or imply the business is an association, unless authorized and covered by the listed exception.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Association Name, Office [5650 - 5655] ( Article 5 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5652. Except as otherwise authorized under existing law, no person, unless lawfully authorized to do business in this state under the provisions of this division and who is actually engaged in carrying on a savings association business, shall: (a) Do business under any name or title that contains the following terms: (1) “Savings association.” (2) “Savings bank.” (3) “Savings and loan association.” (4) “Building and loan association.” (5) “Building association.” (6) Any combination employing either or both of the words “building,” or “loan,” with one or more of the words “saving,” “savings,” or words of similar import. (7) Any combination employing one or more of the words “saving,” “savings,” or words of similar import with one or more of the words “association,” “bank,” “institution,” “society,” “company,” “fund,” “corporation,” or words of similar import. Notwithstanding the provisions of this subdivision, use of the term “savings bank” in a name or title is not prohibited to any person regulated by the provisions of Division 1 (commencing with Section 99), Division 7 (commencing with Section 18000), or under procedures and regulations promulgated by the Comptroller of the Currency, Federal Reserve Board, Office of Thrift Supervision, Federal Housing Finance Board, or Federal Deposit Insurance Corporation. Any reference to the term “savings bank” in this division is not intended to apply to any person other than persons authorized to do business in this state under this division. (b) Use any name or sign or circulate or use any letterhead, billhead, circular or paper whatever, or advertise or represent in any manner that indicates or reasonably implies that the business is the character or kind of business carried on or transacted by an association or is likely to lead any person to believe that the business is that of an association. (Amended by Stats. 1996, Ch. 1064, Sec. 551. Effective January 1, 1997. Operative July 1, 1997.)
  67. 5653.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Association Name, Office [5650 - 5655] ( Article 5 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    A court may issue an injunction to stop violations of Section 5652, and anyone who violates Section 5652 may be fined up to $5,000.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Association Name, Office [5650 - 5655] ( Article 5 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5653. Upon application by the commissioner or any association, a court of competent jurisdiction may issue an injunction to restrain any person from violating or continuing to violate any of the provisions of Section 5652. Any person who violates any provision of Section 5652 shall be punished by a fine of not more than five thousand dollars ($5,000), and each day of violation shall constitute a separate offense. The prohibitions of Section 5652 shall not apply to any corporation or association formed for the purpose of promoting the interests of thrift institutions, the membership of which is comprised of thrift institutions, their officers, or other representatives. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  68. 5654.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Association Name, Office [5650 - 5655] ( Article 5 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    An association must get the commissioner’s prior approval before making certain office, name, corporate, subsidiary, or acquisition changes.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Association Name, Office [5650 - 5655] ( Article 5 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5654. (a) Without the prior approval of the commissioner, as provided in this division, no association shall do any of the following: (1) Establish or maintain any office, other than its home office, which shall be in the location named in the certificate of authority. (2) Change the location or designation of any office from its approved location or designation. (3) Change its corporate name by amendment of its articles of incorporation and its certificate of authority. A change of name is subject to the same criteria as set out in Sections 5650 and 5651. (4) Amend its articles of incorporation or bylaws. (5) Establish or maintain a subsidiary. (6) Acquire all or substantially all of the assets or savings account liabilities of a branch or branches of another financial institution. (b) Applications for approval under this section shall be filed in the office of the commissioner, shall include information as prescribed by regulation or written instruction of the commissioner, and shall be accompanied by any filing fee prescribed by the commissioner pursuant to Section 9001. (c) A public hearing may be held on applications filed under this section in accordance with procedures prescribed by law or by regulations adopted by the commissioner. (d) No certificate of amendment or other certificate to amend the articles of incorporation of an association shall be filed in the office of the Secretary of State unless there is attached thereto the certificate of the commissioner approving the certificate. (e) Applicants filing under this division shall publish notice as prescribed by the commissioner. (Amended by Stats. 1988, Ch. 718, Sec. 9.)
  69. 5655.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Association Name, Office [5650 - 5655] ( Article 5 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    An association may not advertise or present itself to the public as a bank, unless it is a savings bank advertising itself as a savings bank.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Association Name, Office [5650 - 5655] ( Article 5 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5655. No association shall advertise or hold itself out to the public as a bank. This subdivision shall not be construed to prohibit an association which is a savings bank from advertising or holding itself out to the public as a “savings bank.” (Added by Stats. 1984, Ch. 287, Sec. 12. Effective July 6, 1984.)
  70. 566.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Actions Involving the Conduct of Business by Unauthorized Persons [560 - 567] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    The commissioner may sue in superior court to stop violations, force compliance, and collect penalties or other liability, and the court may appoint a receiver or similar officer.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Actions Involving the Conduct of Business by Unauthorized Persons [560 - 567] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 566. (a) The commissioner may bring an action in the name of the people of this state in superior court to enjoin any violation of, to enforce compliance with, or to collect any penalty or other liability imposed under, any law subject to the jurisdiction of the commissioner. The commissioner may bring an action in the name of the people of this state in superior court to enjoin any violation of, to enforce compliance with, or to collect any penalty or other liability imposed under, any regulation promulgated under the power of the commissioner. The commissioner may bring an action in the name of the people of this state in superior court to enjoin any violation of, to enforce compliance with, or to collect any penalty or other liability imposed under, any (1) agreement entered into with the commissioner or (2) order issued by the commissioner. Upon a proper showing, a permanent or preliminary injunction, restraining order, or writ of mandate shall be granted, and a monitor, receiver, conservator, or other designated fiduciary or officer of the court may be appointed for the defendant or the defendant’s assets, or other relief may be granted as appropriate. (b) A receiver, monitor, conservator, or other designated fiduciary officer of the court appointed by the court pursuant to this section may, with the approval of the court, exercise all of the powers of the defendant’s officers, directors, partners, trustees, or persons who exercise similar powers and perform similar duties. No action at law or in equity may be maintained by any party against the commissioner or a receiver, monitor, conservator, or other designated fiduciary or officer of the court by reason of his or her exercise of those powers or performing these duties pursuant to the order of, or with the approval of, the court. (c) If the commissioner finds that it is in the public interest, the commissioner may include in any action authorized by subdivision (a) a claim for ancillary relief, including a claim for restitution, disgorgement, or damages on behalf of the person injured by the act or practice constituting the subject matter of the action, and the court shall have jurisdiction to award ancillary relief. (d) Neither the provision of subdivision (a) that authorizes the appointment of a monitor, receiver, conservator, or other designated fiduciary or officer of the court nor any provision of subdivision (b) or (c) applies to any of the following: (1) A licensee that is authorized by the commissioner to transact appropriate licensee business. (2) A foreign (other state) or foreign (other nation) bank or credit union that maintains an office in this state in accordance with federal law, the law of this state, and the law of the bank or credit union’s domicile. (e) The provisions of this section that authorize the commissioner to bring actions and seek relief are not intended to, and do not, affect any right that any other person may have to bring the same or similar actions or to seek the same or similar relief. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  71. 567.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Actions Involving the Conduct of Business by Unauthorized Persons [560 - 567] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    If a person is doing, or is about to do, licensed business without the required license, the commissioner may order that person to stop that unauthorized business immediately, without prior notice or hearing.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Actions Involving the Conduct of Business by Unauthorized Persons [560 - 567] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 567. If the commissioner finds that a person has conducted, or that there is reasonable cause to believe that a person is about to conduct, business that requires a license issued by the commissioner and that person has not been issued the required license, the commissioner may, without any prior notice or hearing, order the person to cease and desist from conducting any unauthorized business unless and until the person is issued a license to engage in appropriate licensee business. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  72. 5700.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    A state association may convert itself into a federal association if it follows the procedure in Sections 5701 through 5708.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5700. A state association may convert itself into a federal association by following the procedure outlined in Sections 5701 through 5708. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  73. 5701.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    At a meeting called to consider conversion, eligible voters may approve converting an association into a federal association.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5701. At any regular or special meeting called to consider the conversion of an association into a federal association, in the case of a stock association, the stockholders entitled to vote and any members entitled to vote, by an affirmative majority of the votes cast in person or by proxy; and in the case of a mutual association the members, by action on a proposal approved by the members, may resolve to convert the association into a federal association. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  74. 5702.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Several listed persons and institutions may, without court approval, vote on a conversion to a federal association and exchange certain interests for federal-association securities.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5702. Any executor, administrator, guardian, conservator of a natural person or receiver, and any fiduciary or trustee, and any public corporation, political subdivision, public instrumentality, charitable institution, educational and eleemosynary institution, trust company or financial institution, and any insurance company or cemetery association may, without obtaining court approval: (a) Vote in person or by proxy in favor of or against converting a state association into a federal association, or may approve or disapprove the determination to so convert. (b) Exchange any stock, savings accounts, or other rights or claims, for securities issued by the federal association, and hold the securities as legal investments. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  75. 5703.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    After a conversion meeting approving a move into a federal association, the association must promptly file a verified certificate with the commissioner and also file a like certificate with the Secretary of State.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5703. Promptly after the meeting approving a conversion into a federal association, the association shall file in the office of the commissioner a certificate verified by the president or vice president and the secretary or assistant secretary of the association. The certificate shall contain a copy of the minutes of the meeting and a statement of the number of stockholders and members entitled to vote and the number voting to approve the determination to convert the association into a federal association. A like certificate shall be filed in the office of the Secretary of State. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  76. 5704.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    A certified copy of the certificate filed with the Secretary of State counts as presumptive evidence of the meeting, the action taken, and shareholder and member approval.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5704. A certified copy of the certificate required by Section 5703 filed in the office of the Secretary of State is presumptive evidence of the holding of the meeting, the action taken at the meeting, and of the approval of stockholders and members. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  77. 5705.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    After the stockholders’ and members’ meeting, the association must take the steps needed to become a federal association and then file the required charter or certificate with the commissioner and the Secretary of State.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5705. After the meeting of the stockholders and members, the association shall take any action necessary to make it a federal association, and promptly after receipt of the federal charter the association shall file in the office of the commissioner and in the office of the Secretary of State, a copy of the charter issued to it by the Office of Thrift Supervision or a certificate showing the organization of the association as a federal association certified by or on behalf of the Office of Thrift Supervision. Upon the filing of this instrument in the office of the Secretary of State the association ceases to be a state association and is a federal association. (Amended by Stats. 1990, Ch. 1118, Sec. 25.)
  78. 5706.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    When the conversion to a federal association becomes effective, the association stops being supervised by the state and its property transfers to the association in its new federal form by operation of law.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5706. At the time the conversion into a federal association becomes effective the association ceases to be supervised by this state and all of the property of the association, including all of its right, title, and interest in and to all property of every kind and character immediately, by operation of law and without any conveyance, or transfer and without any further act or deed, is vested in the association under its new name and style as a federal association and under its new jurisdiction. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  79. 5707.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    A converted federal association keeps the property from Section 5706 and remains responsible for the converted state association’s obligations.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5707. The converted federal association shall have, hold, and enjoy the property mentioned in Section 5706 in its own right as fully and to the same extent as the property was possessed, held, and enjoyed by it as a state association and the federal association shall continue to be responsible for all of the obligations of the converted state association to the same extent as though the conversion had not taken place. The federal association is merely a continuation of the state association under a new name and new jurisdiction and the revision of its corporate structure as is considered necessary for its proper operation under the new jurisdiction. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  80. 5708.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Certain pre-September 13, 1941 conversions of a building and loan association into a federal association are validated if a federal charter copy was filed with the Secretary of State.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5708. Where a copy of a charter of a federal association, issued by the Federal Home Loan Bank Board pursuant to the laws of the United States was filed with the Secretary of State prior to September 13, 1941, with the intent of converting a building and loan association organized and existing under the laws of this state into a federal association, those conversions are validated, legalized, ratified and confirmed. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  81. 5709.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    A federal association may convert itself into an association if it follows the procedure in Sections 5710 through 5718.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5709. Any federal association may convert itself into an association by following the procedure set forth in Sections 5710 through 5718. (Amended by Stats. 1984, Ch. 287, Sec. 12.5. Effective July 6, 1984.)
  82. 5710.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Stockholders and voting members may approve converting a federal association into an association at a regular or special meeting, if an affirmative majority of votes cast in person or by proxy supports it.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5710. At any regular or special meeting called to consider the action, the stockholders and members entitled to vote by an affirmative majority of the votes cast in person or by proxy, may resolve to convert a federal association into an association. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  83. 5711.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    After a conversion vote, copies of the meeting minutes must be filed promptly with the commissioner and in duplicate with the association’s federal home loan bank.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5711. Copies of the minutes of the proceedings of the meeting of the stockholders or members in which they vote to convert into an association, verified by the president or vice president and the secretary or an assistant secretary, shall be filed promptly after the meeting in the office of the commissioner, and, in duplicate, with the federal home loan bank of which the association is a member. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  84. 5712.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Verified copies of meeting minutes, when filed as required, count as presumptive evidence that the meeting was held and what action was taken.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5712. The verified copies of the minutes of the meeting, when filed as required by Section 5711, are presumptive evidence of the holding and action of the meeting. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  85. 5713.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    After the Section 5710 meeting, the federal association must take the steps needed to become an association under this division, and the elected directors must file the documents and fees and do any required proceedings. The approval or denial decision must be issued in writing. Converted associations are exempt from the capital-subscription rules tied to original incorporation.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5713. After a meeting as provided for in Section 5710, the federal association shall take or cause to be taken such action as shall make it an association in the manner prescribed and authorized by this division. The directors elected at the meeting shall file the documents with applicable fees and take such proceedings as are required by this division in the case of the original incorporation of an association. The decision for approval or denial shall be issued in writing. No association incorporated by conversion from a federal association is required to comply with any of the provisions of law or any regulations promulgated by the commissioner relating to the minimum amounts of capital required to be subscribed in connection with the original incorporation of an association under this division. (Amended by Stats. 1986, Ch. 361, Sec. 4.5.)
  86. 5714.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Directors of an association converted from a federal association may add a specified conversion statement to the articles of incorporation.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5714. The directors of an association converted from a federal association may insert in the articles of incorporation the following statement: “This association is incorporated by conversion from a federal savings and loan association. ” (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  87. 5715.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    After the articles of incorporation are filed with the Secretary of State, the association must promptly file two certified copies with its federal home loan bank.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5715. Promptly after the filing of the articles of incorporation with the Secretary of State, there shall be filed with the federal home loan bank of which the association is a member, two copies of the articles of incorporation, certified by the Secretary of State. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  88. 5716.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    When a federal association files articles of incorporation with the Secretary of State, it becomes an association under state law.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5716. Upon the filing of the articles of incorporation with the Secretary of State, the federal association ceases to be a federal association and is an association under the laws of this state. All of the property of the federal association, including all of its right, title, and interest in and to all property of every kind and character immediately, by operation of law and without any conveyance or transfer, and without any further act or deed, is vested in the association under its new name and style as an association and under its new jurisdiction. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  89. 5717.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    A converted association keeps the property listed in Section 5716 and remains responsible for the old federal association’s obligations.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5717. The converted association shall have, hold, and enjoy the property mentioned in Section 5716 in its own right as fully and to the same extent as the property was possessed, held and enjoyed by it as a federal association and the converted association continues responsible for all of the obligations of the converted federal association to the same extent as though conversion had not taken place. The association is merely a continuation of the federal association under a new name and new jurisdiction and such revision of its corporate structure as is considered necessary for its proper operation under the new jurisdiction. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  90. 5718.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    The commissioner may issue permits and orders for a conversion involving stock issuance, and may require the initial stock to be fully subscribed and paid.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Conversions [5700 - 5718] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5718. In the event stock is to be issued by the converted association, the commissioner may issue an organizing permit to the federal association or to the board of directors elected to serve after conversion, authorizing the association or the board of directors to take subscriptions to stock, to collect subscription payments and to impound the payments pending the issuance of stock, and authorizing the converted association to issue stock after the filing of its articles of incorporation with the Secretary of State. The commissioner may require that all stock to be initially issued be subscribed and fully paid. The commissioner may also issue a certificate of authority to the converted association to be effective upon filing of its articles of incorporation, and may also issue any other orders and permits necessary to authorize the association to continue business without interruption upon the filing of its articles of incorporation. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  91. 5750.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    An association may reorganize, merge, consolidate, or transfer substantially all assets if the board and commissioner approve the plan, and certain member or stockholder approvals are also required.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5750. (a) Pursuant to a plan or agreement (referred to as “agreement” in this article) adopted by the board of directors and approved by the commissioner as fair, just and equitable, and as adequately protecting the interests of the association, its members, or stockholders, its savings account holders and the public, an association shall have the power to reorganize or to merge or consolidate with or transfer all or substantially all its assets to another association or federal association, or any other corporation, provided that the principal terms of the plan of the reorganization, merger, consolidation, or transfer shall, in the case of a stock association, be approved at an annual meeting or at any special meeting, or by the written consent of the stockholders voting on the action, by not less than a majority of the total number of votes eligible to be cast. In the case of a mutual association, if required by the commissioner, the principal terms of such a plan shall be approved by members representing not less than a majority of the voting power. (b) In all cases the survivor association shall succeed to all the rights, obligations, and relations of the constituent associations. (c) As a step in a plan of the reorganization, merger, consolidation, or transfer under this section, an interim corporation may be formed. As used in this section, “interim corporation” means a corporation formed to facilitate the acquisition of 100 percent of the voting stock of an existing association or other insured stock institution by or for a newly formed company or an existing savings and loan holding company or to facilitate any other transaction the commissioner may approve. (Amended by Stats. 1987, Ch. 730, Sec. 5.)
  92. 5751.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    The commissioner may, at the commissioner’s sole discretion, hold a public hearing on applications filed under this article.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5751. At the sole discretion of the commissioner a public hearing may be held on applications filed under this article, in accordance with procedures established by the commissioner by regulation. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  93. 5752.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Applications under this article must include any filing fee set by the commissioner under Section 9001.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5752. Applications filed under this article shall be accompanied by any applicable filing fee prescribed by the commissioner pursuant to Section 9001. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  94. 5753.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Chapter 13 of the Corporations Code applies only to stockholders and their shares in the specified merger or asset-transfer situations.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5753. The provisions of Chapter 13 (commencing with Section 1300) of Division 1 of Title 1 of the Corporations Code shall apply only to stockholders and shares of stock owned by them in the association being merged, or where assets are being transferred into a surviving association, or where a merger or transfer is approved under the provisions of this article by written consent of the stockholders. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  95. 5754.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    In a merger, the agreement must state what parts of the surviving association’s articles are deemed amended, and the articles are amended accordingly when the merger becomes effective.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5754. In a merger the agreement shall state any matters with respect to which the articles of the surviving association are deemed amended and the articles shall be amended accordingly, without any further proceedings, upon the effective date of the merger, but with respect to any amendments, the agreement shall meet the requirements of Section 907 of the Corporations Code in identifying any provisions to be amended, stricken, or added and shall set forth in full the wording of the provision as amended or added or the wording of the amended articles if they be amended in full. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  96. 5755.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    An association must notify stockholders or members before filing a merger or consolidation certificate, unless everyone entitled to vote gave written consent, and it must submit a certificate to the commissioner for written approval.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5755. When a merger or consolidation agreement has been approved by the directors and the stockholders or members of an association, the association shall mail notice of the approval to each of its stockholders or members at least 10 days before filing the certificate as provided in this section unless the consents of all stockholders or members entitled to vote have been solicited and received in writing. After approval by the directors and stockholders or members has been given, the association shall prepare and submit to the commissioner for written approval a certificate in the form of an officers’ certificate (Section 173 of the Corporations Code) which shall set forth the following: (a) An identification of the agreement of merger or consolidation by reference to names of parties and date. (b) That the agreement was approved by the board of directors of the association. (c) The total number of outstanding shares of each class of stock entitled to vote, or in the case of a mutual association the total value of accounts outstanding. (d) That the principal terms of the agreement were approved by the vote or written consent of a number of shares of each class of stock which equaled or exceeded the vote required, or in the case of a mutual association that approval by the members was not required by the commissioner or that the principal terms of the agreement were approved by the vote or written consent of members holding a total value of accounts which equaled or exceeded the vote required. (e) The percentage vote required of each class. (f) That the agreement for merger or consolidation submitted to the commissioner for written approval and for filing with the Secretary of State concurrently with this certificate is the agreement hereinabove referred. (g) Any additional matters that the commissioner may require. (Amended by Stats. 1986, Ch. 361, Sec. 5.)
  97. 5756.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Stockholders or members may approve an amendment to a merger or consolidation agreement, using the same manner and vote as for the original agreement.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5756. Any amendment to a merger or consolidation agreement may be adopted, and the agreement so amended may be approved at the meeting of the stockholders or members of any of the associations or by written consent of the stockholders or members, in the same manner and by the same vote as the original agreement. If the agreement so amended is approved at a meeting or by written consent by the stockholders or members and by the board of directors of each of the associations by the vote or written consent required for approval of the original agreement, the agreement so amended shall be signed and acknowledged and shall have certified therewith the approval of the directors and of the stockholders or members in the same manner as provided for in the original agreement, and shall then constitute the merging or consolidating agreement. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  98. 5757.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Approval of transactions under this article is not required from borrowers or from holders of savings accounts in stock associations.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5757. Notwithstanding any other provision of law, the approval of transactions under this article shall not be required by any borrowers or by holders of savings accounts in associations that issue stock. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  99. 5758.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Certain merger or consolidation documents must be filed with the Secretary of State, and filing is not allowed unless the commissioner’s written approval is attached.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5758. The executed agreement, or an executed counterpart of it and the respective certificate of each constituent association or any other corporation and of the surviving association shall be filed with the Secretary of State. Neither the agreement nor any certificate shall be filed, however, unless the commissioner’s written approval is attached. The effective date of the merger or consolidation under this article shall be the date of the filing with the Secretary of State of the copy of the approved agreement of merger or consolidation. A copy of the approved agreement certified by the Secretary of State shall be filed with the commissioner. If the resulting association is a federal association, the effective date of merger shall be the date the merger is effective under regulations of the Office of Thrift Supervision. (Amended by Stats. 2006, Ch. 773, Sec. 47. Effective September 29, 2006.)
  100. 5759.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    An association may buy all or at least 90% of another association’s or corporation’s stock only with the commissioner’s prior written approval.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5759. An association may acquire all or at least 90 percent of the issued and outstanding stock of another association, or any other corporation, with the prior written approval of the commissioner upon conditions that the commissioner may impose as a step in a plan of merger to be approved by the commissioner. The acquisition of stock shall be upon terms as may be approved by the board of directors of the acquiring association and ratified by the vote or written consent of holders of a majority of the outstanding stock of each class of stockholders of the acquiring association. (Amended by Stats. 1984, Ch. 868, Sec. 7.)
  101. 5760.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    A savings association may merge a subsidiary if ownership and procedural requirements are met, but it must file approvals, give notice in some cases, and the subsidiary’s stockholders may demand cash for their shares.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5760. (a) Any association, owning all the outstanding stock of any corporation, may merge its wholly owned subsidiary corporation if the laws under which the subsidiary corporation exists permit a merger as this section provides. The association shall submit to the commissioner for approval a certificate of ownership in its name signed by its president or a vice president, and its secretary or an assistant secretary, which shall be verified by their affidavit, stating, in effect, that the matters set forth in the certificate are true of their own knowledge. The certificate shall set forth: (1) That it owns all the outstanding stock of the merged corporation. (2) A copy of the resolution adopted by its board of directors to merge the corporation, and to assume all of its obligations. (3) The time and place of the meeting of the board of directors at which the resolution was adopted, and the vote by which it was adopted. (b) If an association owns less than all the outstanding stock but at least 90 percent of the outstanding shares of stock of each class of a corporation or corporations, domestic or foreign, the merger of the subsidiary corporation or corporations into the parent association may be effected by resolutions adopted by the boards of the parent and each subsidiary corporation, and the filing of a certificate of ownership as provided in subdivision (d). The resolution of the board of the parent association shall provide for the merger, shall provide that the parent association assumes all the liabilities of each subsidiary corporation and shall set forth the securities, cash property or rights to be issued, paid, delivered or granted by the parent association upon surrender of each share of stock of each subsidiary corporation not owned by the parent association. The resolution of the board of each subsidiary corporation shall approve the fairness of the consideration to be received for each share of stock of the subsidiary corporation not owned by the parent association. (c) Notwithstanding any other provision of law, in any merger pursuant to this section, the parent association may change its name regardless of whether the name so adopted is the same or similar to that of one of the disappearing associations. In this case the resolution shall provide for the amendment of articles to change the name. (d) After adoption of the resolution or resolutions of merger, as provided under subdivision (b), the association shall submit to the commissioner for approval a certificate of ownership in its name signed by its president or a vice president, and its secretary or an assistant secretary, which shall be verified by their affidavit, stating, in effect, that the matters set forth in the certificate are true of their own knowledge. The certificate shall set forth: (1) That the association owns at least 90 percent of the outstanding stock of the merged corporations. (2) A copy of the resolution adopted by the association’s board of directors to merge the corporation, to assume all of its obligations, and including the resolution for a change of name if applicable. (3) A copy of the resolution or resolutions adopted by the board of each subsidiary corporation, if required. (4) The time and place of the meeting of the boards of directors of the parent and the subsidiary at which the resolutions were adopted, and the vote by which they were adopted. (e) In the event all of the outstanding shares of stock of a subsidiary domestic corporation party to a merger effected under this section are not owned by the parent association immediately prior to the merger, the parent association shall, at least 20 days before the effective date of the merger, give notice to each stockholder of the subsidiary corporation that the merger will become effective on or after a specific date, which notice shall contain (1) a copy of the resolutions of the boards of directors of the parent and the subsidiary required by subdivision (b) above and (2) the information which must accompany the notice required by subdivision (a) of Section 1301 of the Corporations Code. The notice shall be sent by mail addressed to the stockholder at the address of the stockholder as it appears on the records of the corporation. The stockholder shall have the right to demand payment of cash for the shares of stock of the stockholder pursuant to the provisions of Chapter 13 (commencing with Section 1300) of Division 1 of Title 1 of the Corporations Code. (f) If a merger authorized by this section is approved, the commissioner shall attach to the certificate written approval, and the certificate shall be filed with the Secretary of State. A copy of the approved certificate certified by the Secretary of State shall be filed with the commissioner. Thereupon, all of the estate, property, rights, privileges, and franchises of the merged corporation shall vest in and be held and enjoyed by the parent association as fully as the same were before held and enjoyed by the merged corporation, but subject to all the liabilities and obligations of the merged corporation and the rights of all creditors. The parent association shall not, however, thereby acquire the right to engage in any business or to exercise any right, privilege, or franchise of a kind which it could not lawfully engage in or exercise under the provisions of this division. The parent association shall be deemed to have assumed all the liabilities and obligations of the merged corporation, and shall be liable in the same manner as if it had itself incurred the liabilities and obligations. (g) If the merged subsidiary is a domestic corporation, a copy of the certificate shall be filed in the office of the Secretary of State on behalf of the subsidiary corporation. If the merged subsidiary is a foreign corporation qualified for the transaction of intrastate business in this state there shall be filed in the office of the Secretary of State on behalf of the foreign subsidiary a certificate of surrender and right to transact intrastate business as provided in Section 2112 of the Corporations Code. (Amended by Stats. 2006, Ch. 773, Sec. 48. Effective September 29, 2006.)
  102. 5761.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Directors of an association may abandon a transaction under this article before it is completed.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5761. The directors of an association may, in their discretion, abandon a transaction under this article, subject to the rights of third parties under any contracts relating thereto, without further action or approval by the stockholders or members of the association, at any time before the transaction has been completed. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  103. 5762.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    The commissioner may adopt rules and regulations for transactions regulated by this article.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Power to Reorganize, Merge, Consolidate, or Transfer Assets [5750 - 5762] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5762. The commissioner may adopt rules and regulations relating to any transaction regulated by this article. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  104. 580.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 3. Orders Against Licensees and Subject Persons [580 - 583] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    The commissioner may order a subject institution, subject person, or holding company to stop an act or violation after notice and an opportunity to be heard.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 3. Orders Against Licensees and Subject Persons [580 - 583] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 580. If, after notice and an opportunity to be heard, the commissioner finds any of the factors set forth in subdivision (a) or (b) with respect to any subject institution, subject person, or any holding company, the commissioner may order the subject institution, subject person, or holding company to cease and desist from the act or violation: (a) That the subject institution, subject person, or holding company has engaged or participated, is engaging or participating, or that there is reasonable cause to believe that the subject institution, subject person, or holding company is about to engage or participate, in any unsafe or unsound act with respect to the business of the subject institution. (b) That the subject institution, subject person, or holding company has violated, is violating, or that there is reasonable cause to believe that the subject institution, subject person, or holding company is about to violate any: (1) Provision of any division subject to the jurisdiction of the commissioner. (2) Provision of any regulation promulgated by, or subject to the jurisdiction of, the commissioner. (3) Provision of any other applicable law. (4) Provision of any written agreement between the subject institution, subject person, or holding company, and the commissioner. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  105. 5800.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 8. Holding Companies and Stock Acquisitions [5800 - 5811] ( Article 8 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    This section defines key terms for savings and loan holding companies, subsidiaries, and completed applications.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 8. Holding Companies and Stock Acquisitions [5800 - 5811] ( Article 8 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5800. For the purposes of this article the following words and phrases shall have the following meanings: (a) “Savings and loan holding company” means any person that either, directly or indirectly, or acting in concert with one or more other persons: (1) Owns, controls, or holds with power to vote, or holds proxies to vote: (A) Where the association or savings and loan holding company has fewer than 500 stockholders or members, 25 percent or more of the outstanding voting capital stock of any capital stock association or savings and loan holding company or 25 percent or more of the total number of votes or proxies of votes eligible to be cast by the members of any mutual association located in this state. (B) Where the association or savings and loan holding company has at least 500 stockholders or members, 10 percent or more of the outstanding voting capital stock of any capital stock association or savings and loan holding company or 10 percent or more of the total number of votes or proxies of votes eligible to be cast by the members of any mutual association located in this state. (2) Controls in any manner, whether by the holding of proxies or otherwise, the election of a majority of the directors of any association or savings and loan holding company located in this state. (b) Notwithstanding subdivision (a), an individual or group of individuals shall not be deemed to be a “savings and loan holding company” solely because an individual or group of individuals solicits, holds, or votes proxies in an association if, at the time of receiving the proxies, the individual or group of individuals serve as directors of the association and solicited or received the proxies pursuant to authorization by the board of directors of the association. (c) “Subsidiary” of a person means any person, except an individual that is directly or indirectly owned, controlled, or otherwise held by that person to the extent or in the manner described in the preceding subdivision. (d) “Completed application” means an application for acquisition of control of an association, as filed with the commissioner, together with any amendments by the applicant, additional information requested in writing by the commissioner, and accompanied by the applicable filing fee pursuant to Section 9001. If the additional required information is not received within 30 days of the date of the request, the commissioner may consider the application complete upon written notice to the applicant. (Amended by Stats. 1987, Ch. 730, Sec. 6.)
  106. 5801.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 8. Holding Companies and Stock Acquisitions [5800 - 5811] ( Article 8 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    A person cannot become a savings and loan holding company or register under Section 5804 unless the commissioner approves a completed application.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 8. Holding Companies and Stock Acquisitions [5800 - 5811] ( Article 8 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5801. (a) Except as provided in subdivision (b), no person may become a savings and loan holding company, or thereafter register under Section 5804, unless the commissioner approves a completed application. The application shall be in a form prescribed by the commissioner, contain the following information and any additional information that the commissioner may determine by regulation or by written instructions to be necessary or appropriate to preserve the public interest, the integrity of the state’s savings association system, and to protect the interests of savings account holders, borrowers, and stockholders resident in this state: (1) The identity, experience, and financial and managerial resources of each acquiring person by whom or on whose behalf the application is made. (2) The terms, conditions, and method of any proposed acquisition, including copies of all tender offers used or to be used in connection with any proposed acquisition of capital stock. (3) The source, kind, and amount of the consideration used or to be used in making the acquisition, and, if any part of the consideration has been or is to be borrowed or otherwise obtained for the purpose of making the acquisition, a description of the transaction and the names of all participating persons. (4) Any plans or proposals that any acquiring person may have to liquidate or convert the association or savings and loan holding company, to sell its assets or merge it with any company, to change the number of its employees in this state or the terms and conditions of their employment, or to make any other substantial change in its business, corporate structure, management or employees upon becoming a holding company. (5) The names of those officers and directors that the acquiring person proposes to install in any change of managements, and for each of those officers and directors a financial statement, a description of experience in savings association related matters, and a statement as to whether the officer or director ever has been found guilty of misrepresentation, fraud, or financial misdealings. (6) If any tender offer, request or invitation for tenders or other agreement to acquire control is proposed to be made by means of a registration statement under the federal Securities Act of 1933, as amended, or in circumstances requiring the disclosure of similar information under the federal Securities Exchange Act of 1934, as amended, or in an application filed with the Office of Thrift Supervision or Federal Deposit Insurance Corporation requiring similar disclosure, that registration statement or application may be filed with the commissioner in lieu of the requirements of this section. (b) The commissioner may exempt any transaction from the operation of this section if the commissioner determines that regulation of the transaction is not necessary or appropriate. (Amended by Stats. 1990, Ch. 1118, Sec. 27.)
  107. 5802.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 8. Holding Companies and Stock Acquisitions [5800 - 5811] ( Article 8 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    The commissioner must decide a completed application within 60 days, unless good cause prevents a decision in that time, and may approve it with conditions or deny it.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 8. Holding Companies and Stock Acquisitions [5800 - 5811] ( Article 8 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5802. The commissioner shall within 60 days after the date of filing of a completed application, unless good cause is shown why a decision to approve or deny could not be made within 60 days, approve the application with any conditions reasonably necessary or advisable in the public interest, or deny the application. The commissioner shall determine whether the following criteria are met, and if the criteria are not met, the application shall be denied: (a) The acquisition, under any federal or state law, will not substantially lessen competition and will not in any manner be in restraint of trade or result in a monopoly, or be in furtherance of any combination or conspiracy to monopolize or attempt to monopolize the savings association business in any part of the state unless the commissioner finds that the anticompetitive effects of the proposed acquisition are clearly outweighed in the public interest in meeting the convenience and needs of the community that the association serves. (b) The financial condition of any acquiring person will not jeopardize the financial stability of the association or the savings and loan holding company sought to be acquired and will not prejudice the interest of the savings account holders, borrowers, or stockholders of the association and is in the public interest. (c) The plan or proposal under which the acquiring person intends to liquidate the savings association or the savings and loan holding company, to sell its assets or to merge it with any person or association, or to make any other major change in its business or corporate structure or management, is fair and reasonable to the association, its savings account holders, borrowers, and resident stockholders, and will not tend to impair the integrity of the state’s savings association system, and is in the public interest. (d) The competence, experience, integrity, and resources of any acquiring person indicate that approval would be in the interest of the association, its savings account holders, borrowers, and resident stockholders and of the community that the association serves. (e) The requirements of this article have been met. (f) The acquisition would not violate state or federal law and the commissioner determines that approval is in the public interest. (g) The applicant has provided all information requested by the commissioner. (Amended by Stats. 1987, Ch. 730, Sec. 8.)
  108. 5803.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 8. Holding Companies and Stock Acquisitions [5800 - 5811] ( Article 8 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    If an aggrieved person requests a hearing in writing within 30 days after the decision, the commissioner must hold a public hearing. The commissioner also may amend, suspend, or revoke an approval for acquisition of control if the applicant fails to meet approval conditions or if the approval rested on false or misleading facts.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 8. Holding Companies and Stock Acquisitions [5800 - 5811] ( Article 8 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5803. (a) After the decision under this article by the commissioner either approving or denying the application, upon the filing with the commissioner within 30 days after the date of the decision of a written request for a hearing by any person aggrieved by the decision, the commissioner shall hold a public hearing on the merits of the request, after which the decision shall be affirmed, modified, or reversed. (b) The commissioner shall have authority to amend, suspend, or revoke an approval of the application for acquisition of control upon failure of the applicant to meet the conditions of the approval, or upon a finding that the approval was based on false statements, misrepresentations, or omission of material facts. (Amended by Stats. 1987, Ch. 730, Sec. 9.)
  109. 5804.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 8. Holding Companies and Stock Acquisitions [5800 - 5811] ( Article 8 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Savings and loan holding companies must register with the commissioner within 60 days after approval, unless the commissioner extends the date, and must notify the commissioner in writing of changes in beneficial or legal ownership of stock.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 8. Holding Companies and Stock Acquisitions [5800 - 5811] ( Article 8 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5804. (a) Within 60 days following approval, or a later date if extended by the commissioner, each savings and loan holding company shall register with the commissioner in a prescribed form which shall require information with respect to the financial condition, ownership, operations, management, and intercompany relationships of the savings and loan holding company and its subsidiaries, and related matters as the commissioner may deem necessary or appropriate. (b) The registration shall automatically expire if the approval of the application for acquisition of control is revoked or suspended or the person ceases to be a savings and loan holding company. (c) The commissioner shall be notified in writing by a registered savings and loan holding company upon any change in its beneficial or legal ownership of stock of an association. (Amended by Stats. 1987, Ch. 730, Sec. 10.)
  110. 5806.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 8. Holding Companies and Stock Acquisitions [5800 - 5811] ( Article 8 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Savings and loan holding companies that are not individuals must pay an initial and annual registration fee.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 8. Holding Companies and Stock Acquisitions [5800 - 5811] ( Article 8 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5806. Each savings and loan holding company, which is not an individual, shall pay an initial and an annual registration fee of five hundred dollars ($500) if the registrant’s association subsidiaries have total assets of up to one hundred million dollars ($100,000,000) or one thousand dollars ($1,000) if the subsidiaries have total assets of one hundred million dollars ($100,000,000) or more. These fees shall be paid within 30 days following notice from the commissioner that payment is due. (Amended by Stats. 1989, Ch. 868, Sec. 3. Effective September 26, 1989.)
  111. 5807.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 8. Holding Companies and Stock Acquisitions [5800 - 5811] ( Article 8 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    If a savings and loan holding company has met the article’s requirements, the commissioner must issue it a certificate of registration and send a copy to each relevant association subsidiary in this state.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 8. Holding Companies and Stock Acquisitions [5800 - 5811] ( Article 8 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5807. When a savings and loan holding company has satisfied the requirements of this article, the commissioner shall issue the holding company a certificate of registration, and shall send a copy to each association subsidiary in this state with respect to which the holding company has registered. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  112. 5808.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 8. Holding Companies and Stock Acquisitions [5800 - 5811] ( Article 8 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    An affected subsidiary association may not, without the commissioner’s consent, transfer stock, pay dividends, allow voting of its stock, make payments, or enter agreements with its savings and loan holding company.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 8. Holding Companies and Stock Acquisitions [5800 - 5811] ( Article 8 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5808. No association that is a subsidiary in this state of any savings and loan holding company that does not have in effect a certificate of registration for that association as required by this article or whose holding company has failed to comply with (1) an order of a court made in respect to the provisions of this division or (2) an order of the commissioner under Section 8200, shall knowingly, without consent of the commissioner, do any of the following: (a) Transfer or register stock or other securities on its books for or issue certificates to its holding company. (b) Pay dividends on stock of which its holding company is the record or beneficial owner. (c) Permit the voting of stock owned or controlled by its holding company. (d) Make any other payments of any nature to its holding company. (e) Enter into any agreement, contract, or transaction with its holding company. (Amended by Stats. 1987, Ch. 730, Sec. 11.)
  113. 5809.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 8. Holding Companies and Stock Acquisitions [5800 - 5811] ( Article 8 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    The commissioner may require reports from savings and loan holding companies and their subsidiaries, and those entities must file reports and submit to examination as required.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 8. Holding Companies and Stock Acquisitions [5800 - 5811] ( Article 8 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5809. (a) The commissioner from time to time may require reports from any savings and loan holding company and its subsidiaries in a format deemed necessary or appropriate and relevant to the jurisdiction and responsibilities of the commissioner under this division. Any savings and loan holding company and its subsidiaries shall file reports and be subject to examination as required by the commissioner in the manner provided for associations in Article 3 (commencing with Section 8150) of Chapter 7. (b) The cost of any examination may be assessed against each savings and loan holding company examined and the assessment shall be paid to the department. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  114. 581.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 3. Orders Against Licensees and Subject Persons [580 - 583] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    If the commissioner makes the stated findings, the commissioner may order a subject institution or subject person to stop certain harmful conduct without prior notice or a hearing.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 3. Orders Against Licensees and Subject Persons [580 - 583] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 581. If the commissioner finds that any of the factors set forth in Section 580 is true with respect to any subject institution, subject person, or holding company, and that the action, omission, or violation is likely to have any of the consequences set forth in subdivisions (a) to (d), inclusive, the commissioner may, without any prior notice or opportunity to be heard, order the subject institution or subject person to cease and desist from the following: (a) Any act, omission, or violation that may cause the insolvency of the subject institution. (b) Any act, omission, or violation that may cause significant dissipation of the assets or earnings of the subject institution. (c) Any act, omission, or violation that may weaken the condition of the subject institution. (d) Any act, omission, or violation that may otherwise prejudice the interests of the customers of the subject institution. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  115. 5810.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 8. Holding Companies and Stock Acquisitions [5800 - 5811] ( Article 8 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    The commissioner has enforcement powers over savings and loan holding companies and their subsidiaries, as provided for associations in Section 8200.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 8. Holding Companies and Stock Acquisitions [5800 - 5811] ( Article 8 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5810. The commissioner shall have the enforcement powers with respect to savings and loan holding companies and their subsidiaries that are provided with respect to associations in Section 8200. (Amended by Stats. 1987, Ch. 1162, Sec. 9. Effective September 26, 1987.)
  116. 5811.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 8. Holding Companies and Stock Acquisitions [5800 - 5811] ( Article 8 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    This article does not apply to certain stock acquisitions made under a Section 5750 reorganization, merger, consolidation, or transfer plan or agreement.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 8. Holding Companies and Stock Acquisitions [5800 - 5811] ( Article 8 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5811. This article shall not apply to an acquisition of stock made pursuant to a plan or agreement of reorganization, merger, consolidation, or transfer of assets under Section 5750. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  117. 582.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 3. Orders Against Licensees and Subject Persons [580 - 583] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    If the commissioner finds a subject institution’s books or records are too incomplete or inaccurate to assess the institution’s condition, the commissioner may order the institution to stop the activity that caused the problem or take action to fix the books or records, without prior notice or hearing.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 3. Orders Against Licensees and Subject Persons [580 - 583] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 582. If the commissioner finds that a subject institution’s books or records are so incomplete or inaccurate that the commissioner is unable through the normal supervisory process to determine the financial condition of the subject institution or the details or purpose of any transaction or transactions that may materially affect the financial condition of the subject institution, the commissioner may, without any prior notice or hearing, order the subject institution to do either of the following: (a) Cease any activity or practice that gave rise, in whole or in part, to the incomplete or inaccurate state of the books or records. (b) Take affirmative action to restore the books or records to a complete and accurate state. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  118. 583.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 3. Orders Against Licensees and Subject Persons [580 - 583] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    The commissioner must publish specified final orders and decisions on the department’s website, but may delay publication or redact identifying information in limited cases.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 3. Orders Against Licensees and Subject Persons [580 - 583] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 583. (a) The commissioner shall make public on the department’s Internet Web site all final orders issued pursuant to Sections 329, 567, 580, 581, 582, 585, 586, 587, 2148, 14303, 14304, 14305, 14307, 14308, 14309, 14310, 16200.5, 16900.5, 18349.5, 18356, 18357, 18358, 18359, 18363, 18367, and 18415.3 all decisions to modify or rescind an order pursuant to Sections 588, 14311, 16205, and 16905, all decisions to revoke or suspend a license pursuant to Sections 590, 591, 2149, 16202, 16203, 16902, 16903, 18349, and 18353, all decisions to revoke or suspend the designation of an agent pursuant to Sections 2150 and 2151, all decisions to approve resumption of business pursuant to Section 14314, and all decisions to take possession of the property and business of a licensee pursuant to Sections 592, 2149, 2150.2, 14313, 14315, 14319, 16206, 16906, 18415, and 18415.4. This public notice shall be in addition to the notice required pursuant to Section 594. (b) If the commissioner makes a determination in writing that the publication of a final order or decision referenced in subdivision (a) would seriously threaten the safety or soundness of a regulated institution subject to that order or decision, the commissioner may delay publication of the order or decision for a reasonable time. (c) If the commissioner makes a determination that the publication of a final order or decision referenced in subdivision (a) would reveal information which would identify a customer of the institution subject to the order, the commissioner may redact from the order, prior to publication, any information that, in the determination of the commissioner, would identify any customer of the subject institution. (Amended by Stats. 2018, Ch. 699, Sec. 4. (SB 1361) Effective January 1, 2019.)
  119. 585.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 4. Suspension or Removal of Subject Persons [585 - 589] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    The commissioner may, after notice and an opportunity to be heard, suspend or remove a subject person and bar participation in the institution’s affairs if the listed findings are made.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 4. Suspension or Removal of Subject Persons [585 - 589] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 585. If, after notice and an opportunity to be heard, the commissioner finds that any of the factors set forth in subdivision (a), any of the factors set forth in subdivision (b), and any of the factors set forth in subdivision (c) are true with respect to a subject person of a subject institution or holding company, the commissioner may issue an order suspending or removing the subject person from the subject person’s office, if any, with the subject institution or holding company, and prohibiting the subject person from participating in any manner in the conduct of the affairs of the subject institution or holding company without the approval of the commissioner: (a) (1) That the subject person has, directly or indirectly, violated, or has caused a subject institution to violate, any provision of any: (A) Division subject to the jurisdiction of the commissioner. (B) Regulation promulgated by, or subject to the jurisdiction of, the commissioner. (C) Other applicable law. (D) Order issued by the commissioner or under the commissioner’s authority. (E) Written agreement between the subject institution, subject person, or holding company and the commissioner. (2) That the subject person has, directly or indirectly, engaged or participated in any unsafe or unsound act in connection with the business of the subject institution, holding company, or any other business institution. (3) That the subject person has, directly or indirectly, engaged or participated in any act that constitutes a breach of the subject person’s fiduciary duty. (b) That, by reason of the act, violation, or breach of fiduciary duty described in subdivision (a): (1) The subject institution, holding company, or business institution has suffered or will probably suffer financial loss or other harm. (2) The rights or interests of the customers or members of the subject institution have been or could be prejudiced. (3) The subject person has received financial gain or other benefit. (c) That the act, violation, or breach of fiduciary duty described in subdivision (a) either involves dishonesty on the part of the subject person or demonstrates the subject person’s willful or continuing disregard for the safety or soundness of the subject institution, holding company, or business institution. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  120. 5850.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 9. Dissolution [5850- 5850.] ( Article 9 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    An association may dissolve under the General Corporation Law. A mutual association’s voluntary wind-up and dissolution needs member approval by holders of at least 50% of the voting power required to elect directors. Dissolution-related certificates may not be filed with the Secretary of State unless the commissioner’s approval certificate is attached.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 9. Dissolution [5850- 5850.] ( Article 9 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 5850. (a) An association may dissolve pursuant to the General Corporation Law (Division 1 (commencing with Section 100) of Title 1 of the Corporations Code). (b) In the case of a mutual association, the required vote of members to elect voluntarily to wind up and dissolve shall be by members representing 50 percent or more of the voting power required to elect directors of the association. (c) No certificate of election to dissolve or certificate of dissolution of an association shall be filed with the Secretary of State unless there is attached thereto the certificate of the commissioner approving the same. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  121. 586.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 4. Suspension or Removal of Subject Persons [585 - 589] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    The commissioner may suspend a subject person and bar them from participating in the affairs of the subject institution or holding company if the section’s findings are met.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 4. Suspension or Removal of Subject Persons [585 - 589] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 586. If the commissioner finds that any of the factors set forth in subdivision (a) of Section 585, any of the factors set forth in subdivision (b) of Section 585, and any of the factors set forth in subdivision (c) of Section 585 are true with respect to a subject person of a subject institution, and that it is necessary or advisable for the protection of the subject institution or holding company, or the rights or interests of the customers or members of the subject institution, the commissioner may, without any prior notice or opportunity to be heard, issue an order suspending the subject person from the subject person’s office, if any, with the subject institution or holding company, and prohibiting the subject person from participating in any manner in the conduct of the affairs of the subject institution or holding company without the prior approval of the commissioner. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  122. 5860.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 10. Mutual Holding Companies [5860 - 5868] ( Article 10 added by Stats. 1988, Ch. 718, Sec. 10. )

    Verify source ↗

    A mutual association may reorganize into a mutual holding company, but only with the commissioner’s prior approval.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 10. Mutual Holding Companies [5860 - 5868] ( Article 10 added by Stats. 1988, Ch. 718, Sec. 10. ) ## 5860. Notwithstanding any other provision of law, but subject to prior approval of the commissioner, any mutual association may reorganize so as to become a mutual holding company by causing a reorganized savings and loan association to be incorporated and organized as a stock association under this chapter, transferring to the reorganized stock association a substantial part of the assets of that mutual association and causing the reorganized stock association to assume all or a substantial part of the liabilities of the mutual association, including all of its savings account liabilities. (Added by Stats. 1988, Ch. 718, Sec. 10.)
  123. 5861.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 10. Mutual Holding Companies [5860 - 5868] ( Article 10 added by Stats. 1988, Ch. 718, Sec. 10. )

    Verify source ↗

    After the asset transfer and liability assumption in Section 5860, affected account holders and creditors’ rights move to the reorganized stock association, while ownership, liquidation, and voting rights stay with the mutual association in its reorganized mutual holding company form.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 10. Mutual Holding Companies [5860 - 5868] ( Article 10 added by Stats. 1988, Ch. 718, Sec. 10. ) ## 5861. Upon transfer of assets and assumption of liabilities pursuant to Section 5860, persons who prior thereto held savings accounts with, or other rights as creditors of, the mutual association with respect to accounts and liabilities transferred shall have such accounts and rights solely with respect to the reorganized stock association, and the corresponding liability or obligation of the mutual association to those persons shall be assumed by the reorganized stock association without a change in terms. Persons who had ownership, liquidation, or voting rights with respect to the mutual association shall continue to have those rights solely with respect to the mutual association in its reorganized form as a mutual holding company. (Added by Stats. 1988, Ch. 718, Sec. 10.)
  124. 5862.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 10. Mutual Holding Companies [5860 - 5868] ( Article 10 added by Stats. 1988, Ch. 718, Sec. 10. )

    Verify source ↗

    A reorganization of a mutual association under this article must be approved by both the board of directors and the members.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 10. Mutual Holding Companies [5860 - 5868] ( Article 10 added by Stats. 1988, Ch. 718, Sec. 10. ) ## 5862. A reorganization of a mutual association pursuant to this article shall be approved by the board of directors and by the members of the mutual association. (Added by Stats. 1988, Ch. 718, Sec. 10.)
  125. 5863.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 10. Mutual Holding Companies [5860 - 5868] ( Article 10 added by Stats. 1988, Ch. 718, Sec. 10. )

    Verify source ↗

    An application for reorganization approval must include information the commissioner requires. The commissioner may disapprove the proposed mutual holding company formation and refuse a certificate of authority if, within 60 days after a completed application is filed, specified grounds are found.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 10. Mutual Holding Companies [5860 - 5868] ( Article 10 added by Stats. 1988, Ch. 718, Sec. 10. ) ## 5863. An application to the commissioner for approval of a reorganization under this article shall contain such relevant information as the commissioner may require. The commissioner may disapprove any proposed mutual holding company formation and refuse to issue a certificate of authority for the reorganized stock association only if within 60 days after the date of filing of a completed application he or she finds the following: (a) The disapproval is necessary to prevent unsafe and unsound practices. (b) The financial or managerial resources of the mutual association warrant disapproval. (c) The mutual association fails to furnish the information required by the commissioner pursuant to this section. (d) The mutual association fails to comply with the requirements of Section 5862. (Added by Stats. 1988, Ch. 718, Sec. 10.)
  126. 5864.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 10. Mutual Holding Companies [5860 - 5868] ( Article 10 added by Stats. 1988, Ch. 718, Sec. 10. )

    Verify source ↗

    A mutual association may keep capital assets at the holding company level when reorganizing under this article, but only with the commissioner’s approval and only for capital above adequate reserves required by law.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 10. Mutual Holding Companies [5860 - 5868] ( Article 10 added by Stats. 1988, Ch. 718, Sec. 10. ) ## 5864. In connection with reorganization pursuant to the provisions of this article, a mutual association may, subject to the approval of the commissioner, retain capital assets at the holding company level to the extent that the capital exceeds adequate reserves as prescribed by state or federal law. (Added by Stats. 1988, Ch. 718, Sec. 10.)
  127. 5865.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 10. Mutual Holding Companies [5860 - 5868] ( Article 10 added by Stats. 1988, Ch. 718, Sec. 10. )

    Verify source ↗

    A mutual holding company is treated as a savings association for this division, may only do activities authorized for an association, and may not issue or accept savings accounts or other deposits.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 10. Mutual Holding Companies [5860 - 5868] ( Article 10 added by Stats. 1988, Ch. 718, Sec. 10. ) ## 5865. A mutual holding company shall be deemed to be a savings association continuing its organization under this division and may engage only in activities authorized for an association, but may not issue or accept savings accounts or other deposits and the provisions of subdivision (a) of Section 5606 requiring insurance of savings accounts by the Federal Deposit Insurance Corporation shall not be applicable. The articles of incorporation of the mutual holding company shall be amended to delete any inappropriate statements otherwise required by Section 5501.5 and shall include the following statement: “This corporation is a mutual holding company organized under the California Savings Association Law (Article 10 (commencing with Section 5860) of Chapter 2 of Division 2 of the Financial Code).” (Amended by Stats. 1990, Ch. 1118, Sec. 28.)
  128. 5866.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 10. Mutual Holding Companies [5860 - 5868] ( Article 10 added by Stats. 1988, Ch. 718, Sec. 10. )

    Verify source ↗

    For reorganizations under this article, Sections 5801, 5802, and 5803 do not apply.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 10. Mutual Holding Companies [5860 - 5868] ( Article 10 added by Stats. 1988, Ch. 718, Sec. 10. ) ## 5866. Sections 5801, 5802, and 5803 shall not apply to a reorganization pursuant to this article. (Added by Stats. 1988, Ch. 718, Sec. 10.)
  129. 5867.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 10. Mutual Holding Companies [5860 - 5868] ( Article 10 added by Stats. 1988, Ch. 718, Sec. 10. )

    Verify source ↗

    A reorganized stock association may exercise the powers, rights, and privileges of stock associations, and it remains subject to applicable limitations that are consistent with this article.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 10. Mutual Holding Companies [5860 - 5868] ( Article 10 added by Stats. 1988, Ch. 718, Sec. 10. ) ## 5867. Notwithstanding any other provision of law, a reorganized stock association may exercise any and all powers, rights, and privileges of and be subject to all limitations not inconsistent with this article which are applicable to stock associations as provided in this division. (Added by Stats. 1988, Ch. 718, Sec. 10.)
  130. 5868.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 10. Mutual Holding Companies [5860 - 5868] ( Article 10 added by Stats. 1988, Ch. 718, Sec. 10. )

    Verify source ↗

    A reorganized stock association may issue additional capital stock to its mutual holding company, and it may also issue capital stock and convertible securities to others, but the total issued to others cannot exceed 49% of the association’s issued and outstanding capital stock.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 2. Corporate Organization and Corporate Changes [5400 - 5868] ( Chapter 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 10. Mutual Holding Companies [5860 - 5868] ( Article 10 added by Stats. 1988, Ch. 718, Sec. 10. ) ## 5868. A reorganized stock association shall have the power to issue additional amounts of capital stock to the mutual holding company of which it is a subsidiary and, in addition, to other persons an amount of capital stock and securities convertible into capital stock which in the aggregate does not exceed 49 percent of the issued and outstanding capital stock of that organized association. For the purposes of the 49 percent limitation, any issued and outstanding securities that are convertible into capital stock shall be considered issued and outstanding capital stock. (Added by Stats. 1988, Ch. 718, Sec. 10.)
  131. 587.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 4. Suspension or Removal of Subject Persons [585 - 589] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    The commissioner may suspend or remove a subject person or former subject person and bar further participation in the institution’s affairs if specified criminal charges or convictions exist and the person’s continued service may threaten customers or public confidence.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 4. Suspension or Removal of Subject Persons [585 - 589] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 587. (a) If the commissioner finds that any of the factors set forth in paragraph (1) and the factor set forth in paragraph (2) are true with respect to a subject person or former subject person of a subject institution or holding company, the commissioner may, without any prior notice or opportunity to be heard, issue an order suspending the subject person or former subject person from his or her office, if any, with the subject institution or holding company and prohibiting him or her from further participating in any manner in the conduct of the affairs of the subject institution or holding company without the approval of the commissioner: (1) That the subject person or former subject person has been charged in an indictment issued by a grand jury or in an information, complaint, or similar pleading issued by a United States attorney, district attorney, or other governmental official or agency authorized to prosecute crimes, with commission of or participation in any of the following: (A) A crime that involves dishonesty or breach of trust and that is punishable by imprisonment for a term exceeding one year. (B) A criminal violation of any provision of this division. (C) A criminal violation of Section 1956, 1957, or 1960 of Title 18 of, or Section 5322 or 5324 of Title 31 of, the United States Code. (D) A criminal violation of a law of any jurisdiction other than the United States that is substantially similar to any of the statutes specified in subparagraph (C). (2) That continued or resumed service or participation by the subject person or former subject person may pose a threat to the rights or interests of the customers or members of the subject institution or may threaten to impair public confidence in the subject institution. (b) An order issued pursuant to subdivision (a) shall remain in effect until the indictment or the information, complaint, or similar pleading is finally disposed of or, if the order is earlier terminated by the commissioner, until the order is so terminated. (c) If the commissioner finds that the factors set forth in paragraphs (1) and (2) are true with respect to a subject person or former subject person of a subject institution or holding company, the commissioner may, without any prior notice or opportunity to be heard, issue an order suspending or removing the subject person or former subject person from his or her office, if any, with the subject institution or holding company and prohibiting him or her from further participating in any manner in the affairs of the subject institution or holding company without the approval of the commissioner: (1) That the subject person or former subject person has been finally convicted of any crime of the type described in paragraph (1) of subdivision (a). For purposes of this paragraph, an agreement to enter a pretrial diversion or similar program is deemed to be a conviction. (2) That continued or resumed service or participation by the subject person or former subject person may pose a threat to the interests of the customers of the subject institution or may threaten to impair public confidence in the subject institution. (d) The fact that any subject person of a subject institution charged with a crime of the type described in paragraph (1) of subdivision (a) is not finally convicted of the crime does not preclude the commissioner from issuing an order regarding the subject person pursuant to any other provision of this article. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  132. 588.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 4. Suspension or Removal of Subject Persons [585 - 589] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    Certain subject institutions or related persons may ask the commissioner to modify or rescind an order, and the commissioner must consider public interest and likely compliance before deciding.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 4. Suspension or Removal of Subject Persons [585 - 589] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 588. (a) Any subject institution, subject person of a subject institution, or former subject person of a subject institution to whom an order is issued under Sections 585 to 587, inclusive, may apply to the commissioner to modify or rescind the order. In deciding whether to grant or deny the application, the commissioner shall consider whether it is in the public interest to modify or rescind the order and whether it is reasonable to believe that the subject person or former subject person will, if and when he or she becomes a subject person of a subject institution or holding company, comply with all applicable provisions of law, or any regulation or order issued by the commissioner. (b) The right of any subject person or former subject person of a subject institution or holding company to whom an order is issued under Sections 585 to 587, inclusive, to petition for judicial review of the order shall not be affected by the failure of the subject institution or holding company to apply to the commissioner pursuant to subdivision (a) to modify or rescind the order. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  133. 589.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 4. Suspension or Removal of Subject Persons [585 - 589] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    A subject person or former subject person under an order may not do certain acts involving a subject financial institution without the commissioner’s approval while the order is in effect.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 4. Suspension or Removal of Subject Persons [585 - 589] ( Article 4 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 589. (a) In this section, “subject financial institution” means any: (1) Licensee or any bank or credit union that maintains an office in this state. (2) Affiliate of any of the institutions specified in paragraph (1). (3) Subsidiary of any of the institutions specified in paragraph (1). (4) Holding company of any of the institutions specified in paragraph (1). (b) It is unlawful for any subject person or former subject person of a subject financial institution to whom an order is issued under Sections 585 to 587, inclusive, willfully to do, directly or indirectly, any of the following without the approval of the commissioner, so long as the order is in effect: (1) Act as a subject person of any subject financial institution. (2) Vote any shares or other securities having voting rights for the election of any person as a director of a subject financial institution. (3) Solicit, procure, transfer or attempt to transfer, or vote any proxy, consent, or authorization with respect to any shares or other securities of a subject financial institution having voting rights. (4) Otherwise to participate in any manner in the affairs of any subject financial institution. (Amended by Stats. 2013, Ch. 334, Sec. 27. (SB 537) Effective January 1, 2014.)
  134. 590.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 5. Suspension or Possession of a License [590 - 595] ( Article 5 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    The commissioner may revoke or suspend a license after notice and an opportunity to be heard if listed grounds are found.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 5. Suspension or Possession of a License [590 - 595] ( Article 5 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 590. The commissioner may revoke or suspend any license issued by, or under the authority of, the commissioner, if, after notice and opportunity to be heard, the commissioner finds any of the following: (a) The licensee has violated, is violating, or that there is reasonable cause to believe that the licensee is about to violate, any provision of any of the following: (1) Any division subject to the jurisdiction of the commissioner. (2) Any regulation promulgated by, or subject to the jurisdiction of, the commissioner. (3) A provision of any other applicable law. (4) A provision of any order issued by the commissioner. (5) A provision of any written agreement between the licensee and the commissioner. (6) A condition imposed on any written approval granted by the commissioner. (b) Any fact or condition exists which, if it had existed at the time of the original application for the license, would be grounds for denying the application for the license. (c) The licensee is conducting its business in an unsafe or unsound manner. (d) The licensee is in such condition that it is unsafe or unsound for the licensee to transact appropriate licensee business. (e) The licensee has inadequate capital or net worth or is insolvent. (f) The licensee failed to pay any of its obligations as they came due or is reasonably expected to be unable to pay its obligations as they come due. (g) The licensee has applied for an adjudication of bankruptcy, reorganization, arrangement, or other relief under any bankruptcy, reorganization, insolvency, or moratorium law, or that any person has applied for any such relief under any such law against the licensee and the licensee has by any affirmative act approved of, or consented to, the action or the relief has been granted. (h) The licensee has ceased to transact the business the licensee is authorized to conduct pursuant to its license. (i) The licensee refuses to submit its books, papers, and affairs to the inspection of any examiner. (j) Any officer of the licensee refuses to be examined upon oath touching the concerns of the licensee. (k) The licensee has, with the approval of its board, requested the commissioner to take possession of its property and business. (Amended by Stats. 2013, Ch. 334, Sec. 28. (SB 537) Effective January 1, 2014.)
  135. 591.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 5. Suspension or Possession of a License [590 - 595] ( Article 5 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    If the commissioner makes the required findings, the commissioner may immediately suspend or revoke a licensee’s license.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 5. Suspension or Possession of a License [590 - 595] ( Article 5 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 591. If the commissioner finds that any of the factors set forth in Section 590 is true with respect to any licensee and that it is necessary for the protection of the public interest, the commissioner may issue an order immediately suspending or revoking the licensee’s license. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  136. 592.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 5. Suspension or Possession of a License [590 - 595] ( Article 5 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    If specified conditions exist, the commissioner may take possession of a licensee’s property and business without prior notice or a hearing.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 5. Suspension or Possession of a License [590 - 595] ( Article 5 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 592. If the commissioner finds that any of the factors set forth in subdivisions (a) to (k), inclusive, is true with respect to a licensee, the commissioner may by order, without any prior notice or opportunity to be heard, take possession of the property and business of the licensee: (a) The licensee has violated any provision of (1) any division subject to the jurisdiction of the commissioner, (2) any regulation promulgated by, or subject to the jurisdiction of, the commissioner, (3) any provision of any other applicable law, (4) any provision of any order issued by the commissioner, (5) any provision of any written agreement made between the commissioner and the licensee, or (6) a condition imposed on any written approval granted by the commissioner. (b) The licensee is conducting its business in an unsafe or unsound manner. (c) The licensee is in such condition that it is unsafe or unsound for the licensee to transact appropriate licensee business. (d) The licensee has inadequate capital or net worth or is insolvent. (e) If the licensee is a bank, the tangible shareholders’ equity of the bank is less than the following: (1) If the bank is a commercial bank or industrial bank, the greater of three percent of the bank’s total assets or one million dollars ($1,000,000). (2) If the bank is a trust company other than a commercial bank authorized to engage in trust business, one million dollars ($1,000,000). (f) The licensee failed to pay any of its obligations as they came due or is reasonably expected to be unable to pay its obligations as they come due. (g) The licensee has applied for an adjudication of bankruptcy, reorganization, arrangement, or other relief under any bankruptcy, reorganization, insolvency, or moratorium law, or that any person has applied for any such relief under any such law against the licensee and the licensee has by any affirmative act approved of or consented to the action or the relief has been granted. (h) The licensee has ceased to transact the business the licensee is authorized to conduct pursuant to its license. (i) The licensee refuses to submit its books, papers, and affairs to the inspection of any examiner. (j) Any officer of the licensee refuses to be examined upon oath touching the concerns of the licensee. (k) The licensee has, with the approval of its board, requested the commissioner to take possession of its property and business. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  137. 593.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 5. Suspension or Possession of a License [590 - 595] ( Article 5 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    If the commissioner takes possession under Section 592, the licensee may ask the superior court to stop further proceedings within 10 days, and may later resume business only with the commissioner’s approval.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 5. Suspension or Possession of a License [590 - 595] ( Article 5 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 593. (a) If the commissioner takes possession of the property and business of a licensee pursuant to Section 592, the licensee may, within 10 days, apply to the superior court in the county where its head office is located to enjoin further proceedings. The court may, after citing the commissioner to show cause why further proceedings should not be enjoined and after a hearing, dismiss the application or enjoin the commissioner from further proceedings and order the commissioner to surrender the property and business of the licensee to the licensee or make any further order as may be just. The judgment of the court may be appealed by the commissioner or by the licensee as allowed by law. (b) At any time after the commissioner takes possession of the property and business of a licensee pursuant to Section 592, the licensee may, with the approval of the commissioner, resume business upon conditions as the commissioner may prescribe. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  138. 594.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 5. Suspension or Possession of a License [590 - 595] ( Article 5 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    When the commissioner takes possession of a licensee’s property and business, the commissioner must notify persons holding the licensee’s assets. Anyone who knows of the taking, or has been notified, cannot place a lien or charge on the licensee’s assets for later payments or liabilities.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 5. Suspension or Possession of a License [590 - 595] ( Article 5 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 594. (a) Upon taking possession of the property and business of any licensee, the commissioner shall give notice of that fact to all persons holding or having in their possession any assets of the licensee. No person knowing of the taking, or who has been notified thereof, shall have a lien or charge upon any assets of the licensee for any payment, advance, or clearance thereafter made or for any liability thereafter incurred. (b) The giving of notice in accordance with this section shall not be deemed to be a prerequisite to the taking of possession of the property and business of the licensee. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  139. 595.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 5. Suspension or Possession of a License [590 - 595] ( Article 5 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    The commissioner is deemed to take possession of a licensee’s entire property and business when the commissioner takes possession of the business and property of the licensee’s head office.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 6. Enforcement [550 - 595] ( Chapter 6 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 5. Suspension or Possession of a License [590 - 595] ( Article 5 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 595. The commissioner is deemed to take possession of the entire property and business of a licensee when the commissioner takes possession of the business and property of the head office of the licensee. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  140. 6.

    ## Financial Code - FIN ## GENERAL PROVISIONS ( General Provisions enacted by Stats. 1951, Ch. 364. )

    Verify source ↗

    A deputy or authorized person may exercise a power or perform a duty assigned to a person or board, unless the code expressly says only that person or board may do it.

    ## Financial Code - FIN ## GENERAL PROVISIONS ( General Provisions enacted by Stats. 1951, Ch. 364. ) ## 6. Whenever a power is granted to, or a duty imposed on any person or board by any provision of this code, it may be exercised or performed by any deputy or person authorized by the person or board to whom the power is granted or on whom the duty is imposed, unless it is expressly provided that the power or duty shall be exercised or performed only by the person or board to whom the power is granted or on whom the duty is imposed. (Enacted by Stats. 1951, Ch. 364.)
  141. 600.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [600 - 609] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    This section defines “Federal Insurance Agency” for this chapter.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [600 - 609] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 600. In this chapter, “Federal Insurance Agency” means the Federal Deposit Insurance Corporation or the National Credit Union Administration, as appropriate, or their respective successors-in-interest. (Amended by Stats. 2013, Ch. 334, Sec. 29. (SB 537) Effective January 1, 2014.)
  142. 6000.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 1. Meetings of Members of Mutual Associations [6000 - 6006] ( Article 1 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Each mutual association must hold an annual meeting of its members at the time and place set in its bylaws.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 1. Meetings of Members of Mutual Associations [6000 - 6006] ( Article 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6000. An annual meeting of the members of each mutual association shall be held at a time and place fixed in the bylaws of the association. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  143. 6001.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 1. Meetings of Members of Mutual Associations [6000 - 6006] ( Article 1 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Special meetings of a mutual association may be called by the president or board of directors, and must be called by certain officers when qualified members make a written request.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 1. Meetings of Members of Mutual Associations [6000 - 6006] ( Article 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6001. Special meetings of the members of a mutual association may be called at any time by the president or the board of directors, and shall be called by the president, a vice president, or the secretary upon the written request of members holding of record in the aggregate at least 10 percent of the outstanding savings deposits of the association. Such written request shall state the purposes of the meeting and shall be delivered at the principal office of the association addressed to the president. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  144. 6002.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 1. Meetings of Members of Mutual Associations [6000 - 6006] ( Article 1 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    The association must give notice of annual and special member meetings by publication or mailing, post a similar notice at each office, and include required meeting details; members may waive notice in writing.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 1. Meetings of Members of Mutual Associations [6000 - 6006] ( Article 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6002. Notice of each annual and special meeting shall be either published once a week for the two successive calendar weeks (in each instance on any day of the week) immediately prior to the week in which such meeting shall convene, in a newspaper printed in the English language and of general circulation in the city or county in which the principal office of the association is located, or mailed postage prepaid at least 15 days and not more than 45 days prior to the date on which such meeting shall convene to each of its members of record at the last address of the member appearing on the books of the association. Such notice shall state the name of the association, the place of the meeting, the time when it shall convene and, in the case of a special meeting, the purpose or purposes for which the meeting is called. A similar notice shall be posted in a conspicuous place in each of the offices of the association during the 14 days immediately preceding the date on which such meeting shall convene. Notice need not be given to any member who in person or by proxy, in writing, waives notice of such meeting. (Amended by Stats. 1985, Ch. 983, Sec. 2.5. Effective September 26, 1985.)
  145. 6003.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 1. Meetings of Members of Mutual Associations [6000 - 6006] ( Article 1 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Members of a mutual association may vote based on the withdrawal value of their savings accounts, with one vote for each $100 or fraction of $100, subject to a 1,000-vote cap and no vote cumulation for electing directors.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 1. Meetings of Members of Mutual Associations [6000 - 6006] ( Article 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6003. In the consideration of all questions requiring action by the members of a mutual association, each member shall be entitled to cast one vote for each one hundred dollars ($100), or fraction thereof, of the withdrawal value of his or her savings account or accounts. No member, however, shall be entitled to cast more than 1,000 votes nor shall votes be cumulated for the election of directors. (Amended by Stats. 1984, Ch. 287, Sec. 14.7. Effective July 6, 1984.)
  146. 6004.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 1. Meetings of Members of Mutual Associations [6000 - 6006] ( Article 1 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    The association’s board of directors may set a record date in advance for determining which members are entitled to notice, to vote, to receive distributions, or to exercise other lawful rights.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 1. Meetings of Members of Mutual Associations [6000 - 6006] ( Article 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6004. (a) In order that the association may determine the members entitled to notice of any meeting or to vote or entitled to receive any distribution or entitled to exercise any rights in respect of any other lawful action, the board of directors of the association may fix, in advance, a record date, which shall not be more than 60 or less than 10 days prior to the date of such meeting or more than 60 days prior to any other action, provided, however, that if the provisions hereof conflict with the provisions of any federal statute or regulation relating to fixing of record dates for associations, the provisions of the federal statute or regulation shall prevail. (b) If no record date is fixed pursuant to subdivision (a) above: (1) The record date for determining members entitled to notice of or to vote at a meeting of members shall be at the close of business on the business day next preceding the day on which notice is given or first published, or if notice is waived, at the close of business on the business day next preceding the date on which the meeting is held. (2) The record date for determining members entitled to give consent to action in writing without a meeting, when no prior action by the board of directors has been taken, shall be the date on which the first written consent is given. (3) The record for determining members for any other purpose shall be at the close of business on the day on which the board adopts the resolution relating thereto, or the 60th day prior to the date of such other action, whichever is later. (c) A determination of members of record entitled to notice of or to vote at a meeting of members shall apply to any adjournment of the meeting unless the board fixes a new record date for the adjourned meeting. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  147. 6005.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 1. Meetings of Members of Mutual Associations [6000 - 6006] ( Article 1 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Members may vote in person or by proxy, but a proxy must be filed with the association secretary before the meeting to be used.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 1. Meetings of Members of Mutual Associations [6000 - 6006] ( Article 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6005. At any meeting of the members, voting may be in person or by proxy, provided that no proxy is eligible to be voted at any meeting unless it has been filed with the secretary of the association, for verification, prior to the meeting. Each proxy shall be in writing and when filed with the secretary, shall, unless otherwise specified in the proxy, continue in force from year to year until revoked by a writing delivered to the secretary or by a subsequent proxy executed by the member executing the prior proxy or as to any meeting by attendance at such meeting and voting in person by the person executing the proxy. A proxy is not revoked by the death or incapacity of the maker unless, before the vote is counted, written notice of such death or incapacity is received by the association. Section 604 of the Corporations Code does not apply to any mutual association. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  148. 6006.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 1. Meetings of Members of Mutual Associations [6000 - 6006] ( Article 1 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    At a members’ meeting, any number of members present is enough for a quorum, and a majority of votes cast decides questions unless this division says otherwise.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 1. Meetings of Members of Mutual Associations [6000 - 6006] ( Article 1 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6006. Any number of members present at a regular or special meeting of the members shall constitute a quorum. A majority of all votes cast at any meeting of members shall determine any question unless this division specifically provides otherwise. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  149. 601.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [600 - 609] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    After taking possession of a licensee’s property and business, the commissioner must collect money owed to the licensee and take necessary or expedient steps to conserve or protect the licensee’s assets, property, and business.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [600 - 609] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 601. Upon taking possession of the property and business of any licensee, the commissioner has authority, and it is his or her duty, to collect all moneys due to the licensee and to do other acts as are necessary or expedient to collect, conserve, or protect the licensee’s assets, property, and business, and he or she shall proceed to conserve or liquidate the affairs of the licensee as provided in this article. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  150. 602.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [600 - 609] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    No attachment may be issued against the property of a licensee that is under conservation or liquidation under this article.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [600 - 609] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 602. No attachment shall be issued against the property of any licensee subject to conservation or liquidation pursuant to this article. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  151. 603.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [600 - 609] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    After taking possession of a licensee’s property and business under Section 592, the commissioner may liquidate or conserve the licensee.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [600 - 609] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 603. Upon taking possession of the property and business of any licensee pursuant to Section 592, the commissioner may proceed to liquidate or conserve the licensee in the manner provided by this article. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  152. 604.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [600 - 609] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    If the commissioner takes possession of a licensee’s property and business under Section 592, the commissioner may offer appointment as a conservator, liquidator, receiver, or liquidating committee.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [600 - 609] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 604. Upon taking possession of the property and business of a licensee pursuant to Section 592, the commissioner may tender to any person or persons an appointment as conservator, liquidator, receiver, or liquidating committee of the licensee. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  153. 605.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [600 - 609] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    The commissioner must supervise the conservator, liquidator, receiver, or liquidating committee appointed under this article, and may remove them at their discretion.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [600 - 609] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 605. The commissioner shall supervise the acts of the conservator, liquidator, receiver, or liquidating committee appointed under this article and may remove the conservator, liquidator, receiver, or any or all members of the liquidating committee in his or her discretion. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  154. 6050.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 2. Access to Books and Records; Communication with Stockholders or Members; Derivative Actions [6050 - 6053] ( Article 2 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Certain stockholders, members, and directors may inspect specified association records, but there are share, holding-period, purpose, and confidentiality limits.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 2. Access to Books and Records; Communication with Stockholders or Members; Derivative Actions [6050 - 6053] ( Article 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6050. (a) The register of stockholders or members, the books of account, and the minutes of an association shall be subject to inspection upon the written demand of any stockholder or member or group of stockholders or members at any reasonable time during usual business hours, for a proper purpose reasonably related to the stockholder’s or member’s interest. The right of inspection is limited to a stockholder, or member, or group of stockholders or members, who hold of record voting shares having a cost of not less than one hundred thousand dollars ($100,000), or who hold of record voting shares constituting not less than 1 percent of the outstanding voting shares, provided in either case, the stockholder, member, or group of stockholders or members, have been holders of record of the voting shares for at least six months before making the written demand. The right of inspection created by this subdivision shall extend to the records of each subsidiary of an association subject to this subdivision and includes the right to make extracts. (b) Notwithstanding the right of inspection granted in subdivision (a), no stockholder, member, or group of stockholders or members, shall have the right to inspect or make extracts of any portion of any register, book, or minutes of an association containing any of the following: (1) A list of depositors in or borrowers from the association. (2) The addresses of depositors or borrowers from the association. (3) Individual deposit or loan balances or records. “Records” for the purposes of this paragraph means confidential facts pertaining to personal financial information about an individual, including, but not limited to, an individual’s credit file and any loan application. (4) Any data from which any of the information described in paragraphs (1) to (3), inclusive, could be reasonably constructed. (c) Each association director shall have the right at any reasonable time to inspect all books, records, documents of every kind, and the physical properties of that association. The inspection may be made in person or by agent or attorney, and the right of inspection includes the right to make extracts. In the case of foreign associations the right of inspection extends only to books, records, documents, and property located in this state. (d) Savings accountholders who are not stockholders, members, or directors of an association shall have no right of inspection under this section. (Amended by Stats. 1991, Ch. 458, Sec. 1.)
  155. 6051.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 2. Access to Books and Records; Communication with Stockholders or Members; Derivative Actions [6050 - 6053] ( Article 2 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    An association must provide mailing information and an estimated forwarding cost when members or stockholders want to communicate with others about a meeting question, and the commissioner decides whether the communication may be sent.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 2. Access to Books and Records; Communication with Stockholders or Members; Derivative Actions [6050 - 6053] ( Article 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6051. (a) If any member, members, stockholder or stockholders desire to communicate with other members or stockholders of an association about any question pending or to be presented for consideration at a meeting of the members or stockholders, the association shall furnish upon request a statement of the approximate number of members or stockholders of the association at the time of the request, and an estimate of the cost of forwarding the communication. The requesting member, members, stockholder or stockholders shall then submit the communication, together with a sworn statement that the proposed communication is not for any reason other than the business welfare of the association, to the commissioner. If after examination of the facts the commissioner finds it to be appropriate, truthful, and in the best interests of the association and the association’s members or stockholders, the commissioner shall execute a certificate setting out the facts and findings and shall forward the certificate together with the communication to the association and direct that the communication be prepared and mailed by the association to the members or stockholders upon the payment to it by those making the request of the expenses of preparation and mailing. (b) If the commissioner finds the proposed communication to be inappropriate, untruthful, or contrary to the best interests of the association and its members or stockholders, the commissioner may deny or make other disposition of the request to communicate deemed proper and shall execute a certificate setting out facts and findings and deliver it to the party or parties making the request together with an order denying or making other disposition of the request. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  156. 6052.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 2. Access to Books and Records; Communication with Stockholders or Members; Derivative Actions [6050 - 6053] ( Article 2 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    A savings account holder who is not a stockholder or member may not bring or keep an action for the association’s benefit. A stockholder or member may do so only if the stated complaint, notice, and commissioner findings are satisfied.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 2. Access to Books and Records; Communication with Stockholders or Members; Derivative Actions [6050 - 6053] ( Article 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6052. (a) No action may be instituted or maintained in the right of any association by any savings account holder who is not a stockholder or member of the association. (b) An action may be instituted or maintained in the right of an association by a stockholder or member of that association only if all the following conditions exist: (1) The plaintiff alleges in the complaint that the plaintiff was a registered stockholder or member at the time of the transaction or any part of it, or that the stock or membership devolved upon the plaintiff by operation of law from a holder who was a holder at the time of the transaction or any part of it. (2) The plaintiff alleges in the complaint with particularity the efforts of the plaintiff to secure from the board of directors the desired action and alleges further that the plaintiff has either informed the association or its board of directors in writing of the ultimate facts of each cause of action against each defendant director or delivered to the association or its board of directors a true copy of the complaint which plaintiff proposes to file, and the reasons for the plaintiff’s failure to obtain the desired action or the reasons for not making an effort to secure the desired action from the association. (3) The commissioner has determined, after a hearing upon at least 20 days’ written notice to the association and each of its directors, that the action is proposed in good faith and that there is a reasonable probability that the prosecution of the action will benefit the association and its stockholders or members. (c) Subdivisions (c), (d), (e), and (f) of Section 800 of the Corporations Code apply to any actions under this section. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  157. 6053.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 2. Access to Books and Records; Communication with Stockholders or Members; Derivative Actions [6050 - 6053] ( Article 2 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    After a mutual association converts to a stock association, special meetings may be called by the president or board at any time for up to five years, and must be called by certain officers if qualifying stockholders make a written request.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 2. Access to Books and Records; Communication with Stockholders or Members; Derivative Actions [6050 - 6053] ( Article 2 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6053. In the case of an association which converts from a mutual association to a stock association, for a period of up to five years from the date of conversion, special meetings of the stockholders of a stock association may be called at any time by the president, or the board of directors, and shall be called by the president, vice president, or secretary upon the written request of stockholders holding of record in the aggregate at least 20 percent of the outstanding shares of the association, which request shall state the purpose of the meeting and shall be delivered at the principal office of the association addressed to the president. The date for any special meeting called by stockholders shall be set by the board of directors and shall be not less than 60 nor more than 90 days after the date of receipt of the request. (Added by Stats. 1984, Ch. 868, Sec. 8.)
  158. 606.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [600 - 609] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    If the commissioner requires it, the conservator, liquidator, receiver, or liquidating committee members must provide proof of bond coverage, and the bond premium must be paid from the licensee’s assets.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [600 - 609] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 606. If required by the commissioner, the conservator, liquidator, receiver, or members of the liquidating committee appointed under this article shall provide proof of bond coverage that extends to the conservator, liquidator, receiver, or members of the liquidating committee. The bond shall include fraud, dishonesty, and faithful performance coverage. The premium for that bond shall be paid out of the assets of the licensee. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  159. 607.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [600 - 609] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    If the commissioner takes possession of a licensee’s assets for liquidation or conservation, the commissioner should use civil service employees where possible and may appoint special deputy commissioners, hire counsel and experts, and retain certain licensee personnel.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [600 - 609] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 607. (a) If the commissioner retains possession of the assets of the licensee for the purpose of liquidation or conservation, the commissioner shall, to the extent possible, use the services of civil service employees of the commissioner’s office, and the attorneys employed by the commissioner or the Department of Justice shall render all necessary legal services, as the commissioner may request. (b) The commissioner, from time to time, under his or her official seal, may appoint one or more special deputy commissioners as his or her agent or agents with the powers specified in the certificate of appointment to assist him or her in the duties of conservation or of liquidation and distribution. The certificate of appointment shall be filed in the office of the commissioner and a certified copy in the office of the clerk of the county in which the head office of the licensee is located. The commissioner may employ counsel and procure expert assistance and advice as may be necessary in the liquidation and distribution of the assets of the licensee and for that purpose may retain any of the officers or employees of the licensee as the commissioner may deem necessary. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  160. 608.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [600 - 609] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    The commissioner fixes compensation and supervision/liquidation expenses for appointed assistants, and those amounts are paid from the licensee’s funds held by the commissioner.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [600 - 609] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 608. The compensation of civil service employees, special deputies, counsel, and other employees and assistants appointed to assist in the conservation or liquidation of any licensee and the distribution of its assets and all expenses of supervision and liquidation shall be fixed by the commissioner and shall be paid out of the funds of the licensee in the hands of the commissioner. The expenses of liquidation shall be reported to the court upon each application for payment of a dividend. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  161. 609.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [600 - 609] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    If a licensee is not insured by a Federal Insurance Agency and the commissioner takes possession of the licensee’s business and property, the specified superior court has exclusive original jurisdiction, and damages cannot be awarded in that proceeding.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 1. General Provisions [600 - 609] ( Article 1 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 609. If a licensee is not insured by a Federal Insurance Agency, upon the commissioner taking possession of the business and property of the licensee, the superior court of the State of California for the county in which the head office of the licensee is located shall have exclusive original jurisdiction of all proceedings relating thereto and of any action or other proceedings brought under the provisions of this article. All papers relating to the proceeding, including copies of the certificate of appointment of any special deputy and the inventories required to be filed, shall be filed and be made a part of the record of the proceeding without the payment of any additional fees. No damages may be awarded in the proceeding but, if sought, may only be recovered in a separate action. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  162. 6100.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Financial Statement Publication [6100- 6100.] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Each association must publish an annual financial-condition statement in a newspaper of general circulation in the county where its home office is located, and must provide the statement to a member or stockholder upon request.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 3. Financial Statement Publication [6100- 6100.] ( Article 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6100. Each association shall prepare and publish annually within the time prescribed by the commissioner in a newspaper of general circulation in the county in which its home office is located, and shall deliver to each member or stockholder upon request, a statement of its financial condition in the form prescribed or approved by the commissioner. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  163. 6150.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Directors [6150 - 6157] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    An association’s business must be run by a board of directors elected by ballot, and directors and officers owe a fiduciary duty to manage the association soundly.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Directors [6150 - 6157] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6150. (a) The business of each association shall be directed by a board of directors elected by ballot by a plurality of the votes of the members or stockholders present or voting by proxy. (b) Each director and officer of an association has a legal responsibility and fiduciary duty to administer the affairs of and provide sound management to the association. (c) In the case of an association which converts from a mutual association to a stock association, for a period of up to five years from the date of conversion, cumulative voting shall not be required in the election of directors unless otherwise provided in the association’s articles of incorporation. (Amended by Stats. 1986, Ch. 1158, Sec. 2. Effective September 26, 1986.)
  164. 6151.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Directors [6150 - 6157] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    A person convicted of a criminal offense involving dishonesty or breach of trust cannot serve as a director or officer of an association.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Directors [6150 - 6157] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6151. No person shall be eligible for election or shall serve as a director or officer of an association who has been convicted of a criminal offense involving dishonesty or a breach of trust. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  165. 6152.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Directors [6150 - 6157] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    A director stops serving if they are placed in bankruptcy relief or convicted of a dishonesty/trust offense. After a mutual-to-stock conversion, a director generally cannot be removed for up to five years except for cause and by majority vote at a legal meeting.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Directors [6150 - 6157] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6152. (a) A director shall automatically cease to be a director upon becoming the subject of an order for relief in bankruptcy or upon conviction of a criminal offense involving dishonesty or a breach of trust. (b) In the case of an association which converts from a mutual association to a stock association, for a period of up to five years from the date of the conversion, a director may not otherwise be removed except for cause on the affirmative vote of a majority of the votes of members or stockholders eligible to be cast at a legal meeting. (Amended by Stats. 2009, Ch. 500, Sec. 36. (AB 1059) Effective January 1, 2010.)
  166. 6153.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Directors [6150 - 6157] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Directors are elected for three-year terms, and replacements must be elected and qualified before terms end; the board must be arranged so about one-third of directors are elected each year.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Directors [6150 - 6157] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6153. Directors shall be elected for periods of three years and until their successors are elected and qualified, but provision shall be made for the election of approximately one-third of the board of directors each year. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  167. 6154.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Directors [6150 - 6157] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    If members or stockholders do not elect enough directors after the board size increases, the current directors may fill the vacancy until the next annual meeting.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Directors [6150 - 6157] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6154. If the members or stockholders fail to elect a director to fill each vacancy created by an increase in the number of directors, the current directors may fill the vacancy by electing a director to serve until the next annual meeting of the members or stockholders at which time a director shall be elected to fill the vacancy for the unexpired term for the class of directors in which the vacancy exists. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  168. 6155.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Directors [6150 - 6157] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    If the number of directors changes and the resulting vacancies are filled, the directors elected must be elected to terms under Section 6153.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Directors [6150 - 6157] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6155. Whenever the number of directors is changed and vacancies caused by the change are filled, the directors so elected shall be elected to terms in accordance with the provisions of Section 6153. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  169. 6156.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Directors [6150 - 6157] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    If a director seat becomes vacant, the remaining directors may fill it by majority vote and may keep running the association until it is filled.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Directors [6150 - 6157] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6156. (a) Any vacancy among directors, not filled by the members or stockholders, may be filled by a majority vote of the remaining directors, though less than a quorum, by electing a director to serve until the next annual meeting of the members or stockholders, at which time a director shall be elected to fill the vacancy for the unexpired term for the class of director in which the vacancy exists. (b) In the event of a vacancy on the board of directors from any cause, the remaining directors shall have full power and authority to continue direction of the association until the vacancy is filled. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  170. 6157.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Directors [6150 - 6157] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Some savings associations must give the commissioner a copy of a required federal notice at the same time it is sent to the appropriate federal agency.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 4. Directors [6150 - 6157] ( Article 4 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6157. Every savings association subject to the new director or senior executive officer notice requirements of Section 32 of the Federal Deposit Insurance Act (12 U.S.C. Sec. 1831i) based upon recent chartering or change of control or failure to maintain the minimum required capital or otherwise troubled condition shall provide the commissioner, at the same time the notice is submitted to the appropriate federal agency, with a copy of the notification submitted in compliance with that requirement. (Added by Stats. 1990, Ch. 1118, Sec. 29.)
  171. 620.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Conservation or Liquidation of an Insured Licensee [620 - 624] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    If an insured licensee’s property and business have been taken under Section 592, the commissioner must decide whether it will be liquidated or conserved, and may offer the Federal Insurance Agency an appointment as conservator, liquidator, or receiver.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Conservation or Liquidation of an Insured Licensee [620 - 624] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 620. If the licensee whose property and business has been taken pursuant to Section 592 is insured by a Federal Insurance Agency, the commissioner may tender to the appropriate Federal Insurance Agency an appointment as conservator, liquidator, or receiver of the licensee. The commissioner shall determine whether the licensee whose property and business has been taken shall be liquidated or conserved. If the Federal Insurance Agency accepts the appointment, the Federal Insurance Agency shall have, in addition to any powers conferred by applicable federal law, the powers conferred on the commissioner pursuant to this chapter. (Amended by Stats. 2015, Ch. 190, Sec. 29. (AB 1517) Effective January 1, 2016.)
  172. 6200.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Indemnity Bonds [6200 - 6204] ( Article 5 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Directors, officers, and employees of an association must execute individual indemnity bonds with adequate corporate surety before starting their duties, except as provided in Section 6203(b).

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Indemnity Bonds [6200 - 6204] ( Article 5 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6200. Except as provided in subdivision (b) of Section 6203, all directors, officers, and employees of an association shall, before entering upon the performance of any of their duties, execute their individual bonds with adequate corporate surety payable to the association as an indemnity for any loss the association may sustain of money or other property by or through any fraud, dishonesty, forgery or alteration, larceny, theft, embezzlement, robbery, burglary, hold-up, wrongful or unlawful abstraction, misapplication, misplacement, destruction or misappropriation, or any other dishonest or criminal act or omission by the director, officer, or employee. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  173. 6201.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Indemnity Bonds [6200 - 6204] ( Article 5 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Some associations must bond collection agents who are not already covered by a Section 6200 bond, and the bond must be at least twice the agent’s average monthly collections. The agents must also settle with the association at least monthly.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Indemnity Bonds [6200 - 6204] ( Article 5 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6201. Associations that employ collection agents, who for any reason are not covered by a bond required under Section 6200, shall provide for the bonding of each of those agents in an amount equal to at least twice the average monthly collection of the agent. The agents shall be required to make settlement with the association at least monthly. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  174. 6202.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Indemnity Bonds [6200 - 6204] ( Article 5 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    FDIC-insured financial institution agents do not need indemnity bond coverage.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Indemnity Bonds [6200 - 6204] ( Article 5 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6202. No indemnity bond coverage is required of any agent that is a financial institution insured by the Federal Deposit Insurance Corporation. (Amended by Stats. 1990, Ch. 1118, Sec. 30.)
  175. 6203.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Indemnity Bonds [6200 - 6204] ( Article 5 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    Indemnity bond amounts, form, and surety sufficiency must be approved by the board of directors and the commissioner.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Indemnity Bonds [6200 - 6204] ( Article 5 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6203. (a) The amounts and form of indemnity bonds and sufficiency of the surety shall be approved by the board of directors and by the commissioner. (b) In lieu of individual bonds, a blanket bond, protecting the association from loss through any act or acts of any director, officer, employee or agent, may be obtained. (c) A true copy of every indemnity bond shall be on file at all times at the association’s home office. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  176. 6204.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Indemnity Bonds [6200 - 6204] ( Article 5 added by Stats. 1983, Ch. 1091, Sec. 2. )

    Verify source ↗

    An indemnity bond cancellation does not take effect until 10 days’ written notice is given to the commissioner, unless the commissioner approves the cancellation earlier.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 5. Indemnity Bonds [6200 - 6204] ( Article 5 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6204. Indemnity bonds shall provide that their cancellation either by the surety or by the insured shall not become effective unless and until 10 days’ notice in writing first shall have been given to the commissioner, unless the cancellation is approved earlier by the commissioner. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  177. 621.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Conservation or Liquidation of an Insured Licensee [620 - 624] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    The Federal Insurance Agency may serve as a conservator, liquidator, or receiver without bond.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Conservation or Liquidation of an Insured Licensee [620 - 624] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 621. The Federal Insurance Agency may be, and act as, a conservator, liquidator, or receiver without bond. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  178. 622.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Conservation or Liquidation of an Insured Licensee [620 - 624] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    If the Federal Insurance Agency accepts the appointment under Section 620, customers’ and other creditors’ rights in the insured licensee are determined under this state’s applicable laws.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Conservation or Liquidation of an Insured Licensee [620 - 624] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 622. If the Federal Insurance Agency accepts the appointment in accordance with Section 620, the rights of customers and other creditors of the insured licensee shall be determined in accordance with the applicable provisions of the laws of this state. (Amended by Stats. 2015, Ch. 190, Sec. 30. (AB 1517) Effective January 1, 2016.)
  179. 623.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Conservation or Liquidation of an Insured Licensee [620 - 624] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    A Federal Insurance Agency conservator, liquidator, or receiver has the same powers, rights, and privileges as the commissioner under this article for conserving or liquidating a licensee, unless federal law conflicts.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Conservation or Liquidation of an Insured Licensee [620 - 624] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 623. The Federal Insurance Agency conservator, liquidator, or receiver shall possess with respect to the insured licensee all the powers, rights, and privileges given the commissioner under this article with respect to the conservation or liquidation of a licensee, as appropriate, and the property and assets of which he or she has taken possession, except insofar as the same may be in conflict with the provisions of applicable federal law. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  180. 624.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Conservation or Liquidation of an Insured Licensee [620 - 624] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    This section lets the commissioner sell a failing licensee’s business, lets certain buyers purchase it, and gives customers and trust beneficiaries post-sale rights.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 2. Conservation or Liquidation of an Insured Licensee [620 - 624] ( Article 2 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 624. (a) The commissioner may sell to any other licensee any part or the whole of the business of a licensee that is subject to liquidation or conservatorship. The purchase and sale shall be approved by the purchasing licensee, as follows: (1) If the purchasing licensee is organized under the laws of this state, by two-thirds of all of its directors. (2) If the licensee is any licensee other than a licensee organized under the laws of this state, in accordance with the laws of the jurisdiction under which the licensee is organized. (b) (1) Subject to any applicable federal statutes and regulations, any bank or credit union organized under the laws of this state may, with the approval of two-thirds of all of its directors, purchase from the receiver of a national banking association or a federal credit union the whole or any part of the business of the national banking association or federal credit union. (2) Subject to any applicable federal statutes and regulations and any applicable laws of the jurisdiction under which a foreign corporation is organized, any foreign corporation or office of a foreign corporation that is licensed by the commissioner to transact business in this state and that is authorized to accept shares or deposits in this state, may purchase from the receiver of a national banking association or federal credit union the whole or any part of the business of the national banking association or federal credit union. (c) The provisions of Chapter 12 (commencing with Section 1200) and Chapter 13 (commencing with Section 1300) of Division 1 of Title 1 of the Corporations Code shall not apply to any purchase and sale of the type described in subdivision (a) or (b). (d) When a purchase and sale of the type described in subdivision (a) or (b) becomes effective, the licensee shall, ipso facto and by operation of law and without further transfer, substitution, act, or deed, to the extent provided in the agreement of the purchase and sale or in the order of the court approving the purchase and sale and except as withheld or limited by the agreement or by the order: (1) Succeed to the rights, obligations, properties, assets, investments, shares, deposits, demands, and agreements of the licensee whose business is sold, subject to the right of every customer of a licensee to withdraw his or her shares or deposit in full on demand after the sale, irrespective of the terms under which the share or deposit was made. (2) Succeed to the rights, obligations, properties, assets, investments, shares, deposits, demands, and agreements of the licensee whose business is sold under all trusts, executorships, administrations, guardianships, conservatorships, agencies, and other fiduciary or representative capacities, to the same extent as though the purchasing licensee had originally assumed, acquired, or owned the same, subject to the rights of trustors and beneficiaries under the trusts so sold to nominate another or succeeding trustee of the trust so sold after the sale. (3) Succeed to and be entitled to take and execute the appointment to executorships, trusteeships, guardianships, conservatorships, and other fiduciary and representative capacities to which the licensee whose business is sold is or may be named in wills, whenever probated, or to which it is or may be named or appointed by any other instrument. (e) For purposes of subdivision (d), any purchase and sale of the type referred to in subdivision (d) shall be deemed to be effective at the time provided in the agreement of the purchase and sale or in the order of the court approving the purchase and sale. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  181. 640.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 3. Conservatorship of an Uninsured Licensee [640 - 652] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 2. )

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    The commissioner may appoint a conservator for an uninsured licensee if needed to conserve its assets, and may require the conservator to post a bond.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 3. Conservatorship of an Uninsured Licensee [640 - 652] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 640. Whenever the commissioner deems it necessary in order to conserve the assets of any licensee that does not have federal deposit or share insurance for the benefit of the customers and other creditors, he or she may appoint a conservator of the licensee and require the conservator to post a bond as the commissioner deems proper. The conservator, under the direction of the commissioner, shall take possession of the books, records, and assets of every description of the licensee and take any action as the conservator may deem necessary to conserve the assets of the licensee pending further disposition of its business. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  182. 641.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 3. Conservatorship of an Uninsured Licensee [640 - 652] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    A conservator appointed under Section 640 gets the commissioner’s powers and rights over the licensee’s business and property, and must follow the commissioner’s obligations.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 3. Conservatorship of an Uninsured Licensee [640 - 652] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 641. A conservator appointed in accordance with Section 640 has all of the powers and rights with relation to the business and the property of the licensee for which he or she is appointed conservator as are possessed by the commissioner under this article with relation to a licensee of which the commissioner has taken possession, and the conservator is subject to the same obligations as are imposed upon the commissioner under this article. During the time that the conservator remains in possession of the licensee the rights of the licensee, and of all persons with respect thereto, subject to the other provisions of this article, are the same as if the commissioner had taken possession of the property and business of the licensee for the purposes of liquidation. All expenses of the conservatorship shall be paid out of the assets of the licensee and shall be a lien thereon which shall be prior to any other lien. The conservator shall receive a salary in an amount no greater than that which would be paid by the commissioner to a special deputy in charge of the liquidation of a licensee. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  183. 642.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 3. Conservatorship of an Uninsured Licensee [640 - 652] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    The commissioner may order an examination of a licensee after appointing a conservator for that licensee, and must do so at the earliest possible date.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 3. Conservatorship of an Uninsured Licensee [640 - 652] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 642. The commissioner may order an examination at the earliest possible date of a licensee for which the commissioner has appointed a conservator. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  184. 643.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 3. Conservatorship of an Uninsured Licensee [640 - 652] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 2. )

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    If a licensee is under conservatorship, the commissioner may require the conservator to reserve funds for customer withdrawals and payment to other creditors on a ratable basis.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 3. Conservatorship of an Uninsured Licensee [640 - 652] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 643. While any licensee is in the hands of a conservator, the commissioner may require the conservator to set aside and make available for withdrawal by customers and for payment to other creditors on a ratable basis such amounts as in the opinion of the commissioner may safely be used for that purpose. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  185. 644.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 3. Conservatorship of an Uninsured Licensee [640 - 652] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 2. )

    Verify source ↗

    The commissioner may allow a conservator to receive shares or deposits, but if they are received they must be treated as trust funds and kept separate.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 3. Conservatorship of an Uninsured Licensee [640 - 652] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 644. The commissioner, in his or her discretion, may permit the conservator to receive shares or deposits, but any shares or deposits received while the licensee is in the hands of a conservator shall be held as trust funds and shall not be subject to any limitation as to payment or withdrawal. The shares or deposits shall be segregated and shall not be used to liquidate any indebtedness of the licensee existing at the time the conservator was appointed or for the payment of any later indebtedness incurred for the purpose of liquidating any indebtedness of the licensee existing at the time the conservator was appointed. The shares or deposits shall be kept on hand in cash, invested in direct obligations of the United States, or deposited with the Federal Reserve Bank. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  186. 645.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 3. Conservatorship of an Uninsured Licensee [640 - 652] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 2. )

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    The commissioner may end a conservatorship and let the licensee resume business if it can be done safely and is in the public interest.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 3. Conservatorship of an Uninsured Licensee [640 - 652] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 645. If the commissioner is satisfied that it may be done safely and that it would be in the public interest, he or she may terminate a conservatorship and permit the licensee for whom a conservator was appointed to resume the transaction of its business under the direction of its board, subject to any terms, conditions, restrictions, and limitations as the commissioner may prescribe. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  187. 6450.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Records [6450 - 6458] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

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    Each association must keep correct and complete books and records of accounts.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Records [6450 - 6458] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6450. Each association shall keep correct and complete books and records of accounts, as specified in Section 1500 of the Corporations Code. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  188. 6451.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Records [6450 - 6458] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

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    Each agency of an association must keep an original record of each business transaction completed for the association at that agency, unless the records are maintained at the association’s home office or branch office.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Records [6450 - 6458] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6451. (a) Except as provided in subdivision (b), each agency of an association, as defined in Section 6551, shall keep an original record of each transaction of business completed on behalf of the association at the agency. (b) Records of transactions are not required to be maintained at the agency if they are maintained at the association’s home office or branch office. (Amended by Stats. 1989, Ch. 868, Sec. 4. Effective September 26, 1989.)
  189. 6452.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Records [6450 - 6458] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

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    Each association must follow generally accepted accounting principles and practices, unless the commissioner requires or allows different accounting treatment by regulation.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Records [6450 - 6458] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6452. Each association shall observe generally accepted accounting principles and practices except to the extent that the commissioner may require or permit different accounting treatment of accounts by regulation. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  190. 6453.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Records [6450 - 6458] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

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    Each association must close its books at least annually, and can have to do it more often if the commissioner authorizes or requires that in writing.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Records [6450 - 6458] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6453. Each association shall close its books at the close of business at least annually, or more often if authorized or required in writing by the commissioner. (Amended by Stats. 1986, Ch. 361, Sec. 8.)
  191. 6454.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Records [6450 - 6458] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

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    An association must not record its assets on its books under another person’s name or under a misleading description.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Records [6450 - 6458] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6454. No association by any system of accounting or any device of bookkeeping shall, either directly or indirectly, enter any of its assets upon its books in the name of any other person, partnership, association, or corporation or under any title or designation that is not truly descriptive of the assets. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  192. 6455.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Records [6450 - 6458] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

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    Each association must keep complete loan and investment records, and the records must satisfy the commissioner.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Records [6450 - 6458] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6455. (a) Each association shall maintain complete loan and investment records, and shall do so in a manner satisfactory to the commissioner. Detailed records necessary to make determinations of compliance by an association with the requirements of Chapter 6 (commencing with Section 7200) and other provisions of this division shall be maintained at all times. (b) The record of each real estate loan or other secured loan or investment shall contain documentation satisfactory to the commissioner of the type, adequacy and characteristics of the security. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  193. 6456.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Records [6450 - 6458] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

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    Each mutual association must keep membership records showing each member’s name, address, and date of membership.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Records [6450 - 6458] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6456. Each mutual association shall maintain membership records which shall show the name and address of the member and the date of membership. (Amended by Stats. 1985, Ch. 983, Sec. 4. Effective September 26, 1985.)
  194. 6457.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Records [6450 - 6458] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

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    Each capital stock association must keep a register of stockholders.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Records [6450 - 6458] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6457. Each capital stock association shall maintain a register of stockholders. (Repealed and added by Stats. 1983, Ch. 1091, Sec. 2.)
  195. 6458.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Records [6450 - 6458] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. )

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    An association may copy or reproduce its records using approved photostatic, photographic, or microfilming methods, and the resulting copies are treated as originals.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 6. Records [6450 - 6458] ( Article 6 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6458. (a) Any association may cause any or all records of the association to be copied or reproduced by any photostatic, photographic, or microfilming process that correctly and permanently copies, reproduces, or forms a medium for copying or reproducing the original record on a film or other durable material. (b) Any copy or reproduction made under subdivision (a) shall be deemed to be an original record for all purposes and shall be treated as an original record in all courts or administrative agencies for the purpose of its admissibility in evidence. (c) A facsimile, exemplification, or certified copy of any copy made pursuant to subdivision (a), or a reproduction produced from a film record, shall, for all purposes, be deemed a facsimile, exemplification, or certified copy of the original record. (Added by renumbering Section 6460 by Stats. 1984, Ch. 287, Sec. 15. Effective July 6, 1984.)
  196. 646.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 3. Conservatorship of an Uninsured Licensee [640 - 652] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 2. )

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    The conservator must publish a notice in a local newspaper and mail copies to certain depositors; the commissioner must first approve the notice form and newspaper.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 3. Conservatorship of an Uninsured Licensee [640 - 652] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 646. The conservator of a licensee that has been permitted to resume accepting member shares or deposits shall first cause a notice to be published in a newspaper of local circulation. The notice shall state the date on which the affairs of the licensee will be returned to its board and that the provisions of Section 644 will not be effective after 30 days from that date. The form of the notice and the newspaper in which the same is to be published shall be first approved by the commissioner. On the date of the publication of the notice, the conservator shall mail a copy of the notice to every person who made any deposit in the licensee after the date of the appointment of the conservator. The conservator shall address the copy of the notice to the persons who have made the deposits at the addresses appearing upon the books of the licensee. The conservator shall also mail a similar notice to every person making a deposit in the licensee after the date of the publication of the notice and before the affairs of the licensee are returned to its board. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  197. 647.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 3. Conservatorship of an Uninsured Licensee [640 - 652] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 2. )

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    The commissioner may assess and collect each affected licensee’s share of the costs of administering this article when a conservator is appointed.

    ## Financial Code - FIN ## DIVISION 1. FINANCIAL INSTITUTIONS [99 - 900] ( Division 1 repealed and added by Stats. 2011, Ch. 243, Sec. 2. ) ## CHAPTER 7. Liquidation and Conservation [600 - 710] ( Chapter 7 added by Stats. 2011, Ch. 243, Sec. 2. ) ## ARTICLE 3. Conservatorship of an Uninsured Licensee [640 - 652] ( Article 3 added by Stats. 2011, Ch. 243, Sec. 2. ) ## 647. The commissioner may assess and collect from all licensees for whom a conservator is appointed their ratable share of the costs incurred in the administration of this article. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)
  198. 6475.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Statutory Net Worth; Reserve Accounts [6475 - 6477] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. )

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    Associations must maintain adequate statutory net worth, and the commissioner must set a minimum requirement of at least 3% of total assets.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Statutory Net Worth; Reserve Accounts [6475 - 6477] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6475. (a) Each association shall maintain an adequate statutory net worth appropriate for the conduct of its business and the protection of its savings account holders. (b) The commissioner shall fix a minimum statutory net worth requirement applicable to all associations, which shall not be less than 3 percent of an association’s total assets. In defining total assets, the commissioner may issue regulations to exclude from the total asset figure any asset items deemed appropriate by the commissioner. (c) If the statutory net worth falls below the level specified by the commissioner, the commissioner may require the association to increase its statutory net worth within the time and in a manner designated by the commissioner, so as to bring the amount to the level determined adequate under this section, and may require the association to do any one or more of the following: (1) Increase its liquid assets and maintain that increased liquidity at the level specified by the commissioner. (2) Cease to: (A) Accept savings accounts of all classes or categories, except in exchange for accounts already outstanding. (B) Accept savings accounts of any particular class, category, or amount. (C) Receive additional funds upon savings accounts already outstanding other than installment accounts. The provisions of paragraph (2) of subdivision (c) shall not prevent an association from crediting to savings accounts the interest earned on the accounts. (3) Cease all lending, lending in a particular area, or making a particular type or category of loans. (4) Cease purchase of loans or other investments. (5) Cease or limit promotional expenditures. (6) Convene a meeting or meetings of its board of directors with the commissioner in attendance to accomplish the objectives of this section. (7) Take any other steps that the commissioner deems necessary to safeguard the interests of the association and the public. (Amended by Stats. 1988, Ch. 718, Sec. 11.)
  199. 6476.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Statutory Net Worth; Reserve Accounts [6475 - 6477] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. )

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    Each association must maintain reserves required by this division and may maintain additional permitted reserves. The board of directors may also make extra transfers to surplus or other reserve accounts.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Statutory Net Worth; Reserve Accounts [6475 - 6477] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6476. Each association shall set up and maintain the reserves required by, and may set up and maintain any additional reserves that are permitted by, this division. The board of directors may make additional transfers to surplus or other reserve accounts. (Added by Stats. 1983, Ch. 1091, Sec. 2.)
  200. 6477.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Statutory Net Worth; Reserve Accounts [6475 - 6477] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. )

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    If an association joins an exchange to evade the division or a commissioner order, the commissioner may direct it to create and keep a reserve for the full amount of the acquired asset, and the association must not count that reserve in statutory net worth.

    ## Financial Code - FIN ## DIVISION 2. SAVINGS ASSOCIATION LAW [5000 - 10009] ( Division 2 repealed and added by Stats. 1983, Ch. 1091, Sec. 2. ) ## CHAPTER 3. Corporate Administration [6000 - 6477] ( Chapter 3 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## ARTICLE 7. Statutory Net Worth; Reserve Accounts [6475 - 6477] ( Article 7 added by Stats. 1983, Ch. 1091, Sec. 2. ) ## 6477. Any association which, for the purpose of evading provisions of this division or any order of the commissioner, knowingly participates, directly or indirectly, in an exchange with another association of any loan, investment, or other asset held by either association in violation of any provision of this division or any order of the commissioner, shall, upon direction of the commissioner, set up and maintain a reserve in the full amount of the asset acquired and shall not include that reserve in its statutory net worth. (Added by Stats. 1986, Ch. 1158, Sec. 3. Effective September 26, 1986.)

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