(a)
In this section:
(1)
“Adjusted liabilities,” when used with respect to a foreign (other nation) credit union, means the liabilities of the foreign (other nation) credit union’s business in this state, determined in accordance with generally accepted accounting principles, but excluding (A) accrued expenses, (B) any liability to an office (whether in or outside of this state) or majority-owned subsidiary of the foreign (other nation) credit union, and (C) other liabilities
as the commissioner may by regulation or order exclude.
(2)
“Applicable minimum,” when used with respect to eligible assets deposited or to be deposited with an approved depository by a foreign (other nation) credit union, means the amount as the commissioner may from time to time by regulation or order determine to be necessary for the maintenance of sound financial condition, for the protection of the interests of creditors of the foreign (other nation) credit union’s business in this state, or for the protection of the public interest. However, in the case of a foreign (other nation) credit union which is licensed to maintain a branch office, the applicable minimum shall not be less than 5 percent of the adjusted liabilities of the foreign (other nation) credit union.
(3)
“Approved depository,” when used with respect to a foreign (other nation) credit union, means a bank or
credit union organized under the laws of this state or a national bank headquartered in this state that has been selected by the foreign (other nation) credit union and approved by the commissioner for the purpose of acting as the approved depository of the foreign (other nation) credit union and that has filed with the commissioner, in the form as the commissioner may by regulation or order prescribe, an agreement to comply with all applicable provisions of this section and of any regulation or order issued under this section.
(4)
“Eligible assets” when used with respect to a foreign (other nation) credit union, means any of the following:
(A)
Cash.
(B)
Any negotiable certificate of deposit that (i) has a maturity of not more than one year, (ii) is payable in the United States, and (iii) is issued by a bank
organized under the laws of a state of the United States, by a national bank, or by a branch office of a foreign (other nation) bank that is located in the United States.
(C)
Any banker’s acceptance that is payable in the United States and that is eligible for discount with a federal reserve bank.
(D)
Any other asset that the commissioner by regulation or order determines to be eligible.
Notwithstanding the foregoing provisions of this paragraph, “eligible asset,” when used with respect to a foreign (other nation) credit union, does not include any instrument the issuer of which (i) is, or is affiliated with, the foreign (other nation) credit union, (ii) is domiciled in, or controlled by a person domiciled in, the same foreign nation as the foreign (other nation) credit union, or (iii) is, or is controlled by, the foreign nation. For
purposes of the foregoing provision, to be “affiliated” means to control, to be controlled by, or to be under common control with; and to “control” has the meaning set forth in subdivision (b) of Section 700.
(b)
For purposes of this section:
(1)
The amount of adjusted liabilities of a foreign (other nation) credit union’s business in this state shall be computed for the period of time and in the manner as the commissioner may by regulation or order prescribe.
(2)
An eligible asset shall be valued at the lesser of market or par.
(c)
(1)
Before a foreign (other nation) credit union is authorized to transact business in this state, the foreign (other nation) credit union shall deposit, and each foreign (other nation) credit union
that is licensed to transact business in this state shall maintain on deposit, with an approved depository eligible assets having a value in an amount not less than the applicable minimum.
(2)
Whenever a foreign (other nation) credit union that is licensed to transact business in this state ceases to be so licensed, the foreign (other nation) credit union shall thereafter maintain on deposit with an approved depository eligible assets having a value in an amount not less than the applicable minimum for the period of time as the commissioner may determine to be necessary for the protection of creditors of the foreign (other nation) credit union’s business in this state or for the protection of the public interest.
(d)
(1)
No foreign (other nation) credit union that maintains eligible assets on deposit with an approved depository pursuant to this section shall
withdraw any eligible asset except with the prior approval of the commissioner.
(2)
No approved depository that holds eligible assets on deposit from a foreign (other nation) credit union pursuant to this section shall release any eligible asset except with the prior approval of the commissioner or as otherwise provided in subdivision (h).
(e)
Any foreign (other nation) credit union that maintains eligible assets on deposit with an approved depository pursuant to this section shall, unless the commissioner shall have suspended or revoked its authorization to transact business in this state or taken possession of its property and business in this state, be entitled to receive any income paid on eligible assets.
(f)
(1)
Whenever a foreign (other nation) credit union deposits eligible assets with,
or withdraws eligible assets from, an approved depository pursuant to this section, the foreign (other nation) credit union shall do so in accordance with the procedures and requirements as the commissioner may by regulation or order prescribe.
(2)
Whenever an approved depository receives, holds, or releases eligible assets pursuant to this section, the approved depository shall do so in accordance with the procedures and requirements as the commissioner may by regulation or order prescribe and shall file with the commissioner reports as and when the commissioner may by regulation or order require.
(g)
Whenever a foreign (other nation) credit union maintains eligible assets on deposit with an approved depository pursuant to this section:
(1)
The eligible assets shall be deemed to be pledged to the commissioner for
the benefit of the creditors of the foreign (other nation) credit union’s business in the state; and, notwithstanding any provision of the Uniform Commercial Code to the contrary, the commissioner, for the benefit of these creditors, shall be deemed to have a security interest in the eligible assets.
(2)
The eligible assets shall be free from any lien, charge, right of setoff, credit, or preference in connection with any claim of the approved depository against the foreign (other nation) credit union.
(h)
(1)
In case the commissioner takes possession of the property and business of a foreign (other nation) credit union that maintains eligible assets on deposit with an approved depository pursuant to this section, the approved depository shall, upon order of the commissioner, release the eligible assets to the commissioner, as liquidator of the property and
business of the foreign (other nation) credit union.
(2)
In case a foreign (other nation) credit union that maintains eligible assets on deposit with an approved depository pursuant to this section fails to pay any judgment creditor of its business in this state and the commissioner has not taken possession of the property and business of the foreign (other nation) credit union, the approved depository shall release the eligible assets to the commissioner, and the commissioner shall dispose of the eligible assets, as a court of competent jurisdiction of this state or of the United States may order for the benefit of the judgment creditor. For purposes of this paragraph, “judgment creditor of its business in this state” means a person to whom the foreign (other nation) credit union is required to pay money under a judgment that (A) arose out of the foreign (other nation) credit union’s business in this state, (B) has been entered by a court of
this state or of the United States, (C) has become final, in that all possibility of direct attack on the judgment by way of appeal, motion for new trial, motion to vacate, or petition for extraordinary writ has been exhausted, and (D) has remained unpaid for a period of not less than 60 days after becoming final.
