§ 1761c. — Credit committee.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 12USC1761c]
TITLE 12--BANKS AND BANKING
CHAPTER 14--FEDERAL CREDIT UNIONS
SUBCHAPTER I--GENERAL PROVISIONS
Sec. 1761c. Credit committee
(a) Members; meetings; lines of credit and approval of loans; delegation
to loan officers
If the bylaws provide for a credit committee, then pursuant to the
provisions of the bylaws, the board of directors may appoint or the
members may elect a credit committee which shall consist of an odd
number of members of the credit union, but which shall not include more
than one loan officer. The method used shall be set forth in the bylaws.
The credit committee shall hold such meetings as the business of the
Federal credit union may require, not less frequently than once a month,
to consider applications for loans or lines of credit. Reasonable notice
of such meetings shall be given to all members of the committee. Except
for those loans or lines of credit required to be approved by the board
of directors in section 1757(5) of this title, approval of an
application shall be by majority of the committee who are present at the
meeting at which it is considered provided that a majority of the full
committee is present. The credit committee may appoint and delegate to
loan officers the authority to approve applications.
(b) Review and reversal of loan refusals; review by board in lieu of
committee; limitation on disbursements by loan officers
If the bylaws provide for a credit committee, all applications not
approved by the loan officer shall be reviewed by the credit committee,
and the approval of a majority of the members who are present at the
meeting when such review is undertaken shall be required to reverse the
loan officer's decision provided a majority of the full committee is
present. If there is not a credit committee, a member shall have the
right upon written request of review by the board of directors of a loan
application which has been denied. No individual shall have authority to
disburse funds of the Federal credit union with respect to any loan or
line of credit for which the application has been approved by him in his
capacity as a loan officer.
(June 26, 1934, ch. 750, title I, Sec. 114, formerly Sec. 15, as added
Pub. L. 86-354, Sec. 1, Sept. 22, 1959, 73 Stat. 633; amended Pub. L.
88-353, Sec. 4, July 2, 1964, 78 Stat. 269; Pub. L. 90-188, Sec. 1, Dec.
13, 1967, 81 Stat. 567; Pub. L. 90-375, Sec. 1(5), July 5, 1968, 82
Stat. 284; Pub. L. 91-206, Sec. 2(1), Mar. 10, 1970, 84 Stat. 49;
renumbered title I, Sec. 114, Pub. L. 91-468, Sec. 1(2), Oct. 19, 1970,
84 Stat. 994; amended Pub. L. 95-22, title III, Sec. 304, Apr. 19, 1977,
91 Stat. 51; Pub. L. 95-630, title V, Sec. 502(b), Nov. 10, 1978, 92
Stat. 3681; Pub. L. 97-320, title V, Sec. 523, Oct. 15, 1982, 96 Stat.
1533.)
Prior Provisions
Provisions similar to those comprising this section were contained
in section 11(d) of act June 26, 1934, ch. 750, 48 Stat. 1219 (formerly
classified to section 1761(d) of this title), prior to the amendment and
renumbering of act June 26, 1934 by Pub. L. 86-354.
Amendments
1982--Pub. L. 97-320 designated existing provisions as subsecs. (a)
and (b), in subsec. (a) as so designated, inserted provisions relating
to the membership of the committee and provisions requiring the majority
of the full committee to be present for votes on lines of credit, struck
out provision requiring each loan officer to report his action on an
application in seven days of its filing, in subsec. (b) as so
designated, inserted provisions relating to the number of members needed
to reverse a loan officer's decision and provision for the case where
there is no credit committee, and thereafter struck out provisions that
not more than one member of the committee might be appointed as a loan
officer, that applications for loans and lines of credit be made on
forms prepared by such committee which set forth the security, if any,
and such other data as required, that no loan may be made to any member
if, upon the making of that loan, the member would have been indebted to
the Federal credit union upon loans made to him in an aggregate amount
which would exceed 10 per centum of the credit union's unimpaired
capital and surplus, and that for the purposes of this section an
assignment of shares or the endorsement of a note would be deemed
security and, subject to such regulations as the Board prescribed,
insurance obtained under title I of the National Housing Act [12 U.S.C.
1702 et seq.] would be deemed adequate security.
1978--Pub. L. 95-630 substituted ``Board'' for ``Administrator''.
1977--Pub. L. 95-22 substituted ``loans and lines of credit'' for
``loans'' in three places, ``Except for those loans or lines of credit
required to be approved by the board of directors in section 1757(5) of
this title, approval of an application shall be'' for ``No loan shall be
made unless it is approved'', ``application approved'' for ``loan
approved'', ``applications not approved'' for ``loans not approved'',
and ``with respect to any loan or line of credit for which the
application'' for ``for any loan which'' and struck out ``the purpose
for which the loan is desired'' after ``which shall set forth'', ``$200
or'' after ``amount which would exceed'', ``whichever is greater'' after
``capital and surplus'', and provision relating to requirement that no
unsecured loan be made to a member which would make the member indebted
to the Federal credit union in excess of a specified amount.
1970--Pub. L. 91-206 substituted ``Administrator'' for ``Director''.
1968--Pub. L. 90-375 substituted provisions which increased the
unsecured loan limit, in the case of a credit union whose unimpaired
capital and surplus is less than $8,000 to $200, and, in the case of any
other credit union to $2,500 or 2\1/2\% of the unimpaired capital and
surplus, whichever is less, for provisions which authorized credit
unions to make unsecured loans of $750 or 10% of their unimpaired
capital and surplus, whichever is smaller.
1967--Pub. L. 90-188 struck out ``up to the unsecured limit, or in
excess of such limit if such excess is fully secured by unpledged
shares'' from end of provision that credit committees may appoint one or
more loan officers, and delegate to him or them the power to approve
loans.
1964--Pub. L. 88-353 inserted ``and, subject to such regulations as
the Director may prescribe, insurance obtained under title I of the
National Housing Act shall be deemed adequate security''.
Effective Date of 1978 Amendment
Amendment by Pub. L. 95-630 effective on expiration of 120 days
after Nov. 10, 1978, and transitional provisions, see section 509 of
Pub. L. 95-630 set out as a note under section 1752 of this title.
