Credit unions authorization to obtain insurance from a credit union share insurance provider

A bill for an act

relating to financial institutions; authorizing credit unions to obtain insurance from

a credit union share insurance provider; regulating credit union share guaranty

corporations; amending Minnesota Statutes 2024, sections 52.063, subdivision 3;

52.24, subdivisions 1, 2, by adding a subdivision.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2024, section 52.063, subdivision 3, is amended to read:

Subd. 3.

Appointment of National Credit Union Administration Board as

receiver.

Upon a request by the commissioner of commerce, the court may appoint the

National Credit Union Administration Board, created by section 3 of the Federal Credit

Union Act, as amended,
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or a share insurance provider approved by the commissioner
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as

receiver of a credit union, without bond, when the deposits of the credit union are to any

extent insured by the National Credit Union Administration Board
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or approved share

insurance provider
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, and the credit union has had its operations suspended or has executed

a consent cease and desist order with the commissioner in lieu of a suspension under section

52.062
. Notwithstanding any other provisions of law, the commissioner of commerce may,

in the event of the suspension or consent cease and desist order, tender to the National Credit

Union Administration Board
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or approved share insurance provider
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the proposed appointment

as receiver of the credit union. If the National Credit Union Administration Board
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or approved

share insurance provider
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accepts the proposed appointment and the court appoints the

National Credit Union Administration Board
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or approved share insurance provider
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as receiver

upon a request by the commissioner, the National Credit Union Administration Board
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or

approved shared insurance provider
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shall have and possess all the powers and privileges

provided by the laws of this state and section 207 of the Federal Credit Union Act, as

amended, with respect to a receiver of a credit union, the board of directors of the credit

union, and its members.

Sec. 2.

Minnesota Statutes 2024, section 52.24, subdivision 1, is amended to read:

Subdivision 1.

Insurance accounts.

Every credit union under the supervision of the

commissioner of commerce shall at all times maintain in effect insurance of member share

and deposit accounts under the provisions of title II of the National Credit Union Act
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or

through a credit union share guaranty corporation that is approved by the commissioner
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. A

credit union
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which
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that
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fails to meet this requirement for insurance of its share and deposit

accounts shall either dissolve or merge with another credit union
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which
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that
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is insured under

title II of the National Credit Union Act
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or through a credit union share guaranty corporation

that is approved by the commissioner
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.

Sec. 3.

Minnesota Statutes 2024, section 52.24, is amended by adding a subdivision to

read:

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Subd. 1a.

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Credit union share guaranty corporation; accounts insured.

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(a) A credit

union share account of an individual member or a nonmember of a participating credit union

must be guaranteed in an amount established from time to time by the credit union share

guaranty corporation. The primary guaranteed amount must be at least the amount of the

credit union share account but must not exceed $250,000 or the primary guaranteed amount

insured by the National Credit Union Administration, whichever is greater.

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(b) The commissioner may examine a credit union share guaranty corporation that insures

the member accounts of a credit union that is subject to this section. The commissioner may

assess the credit union share guaranty corporation examined for reasonable costs incurred

to conduct an examination under this section. Money received from an assessment under

this paragraph must be deposited in the financial institutions account in the special revenue

fund.

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(c) A credit union is prohibited from voluntarily terminating the credit union's insurance

with the National Credit Union Administration Share Insurance Program or a credit union

share guaranty corporation without receiving approval from the commissioner.

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Sec. 4.

Minnesota Statutes 2024, section 52.24, subdivision 2, is amended to read:

Subd. 2.

Certificate of approval.

No credit union shall be granted a certificate of

approval by the commissioner of commerce unless the credit union has obtained a

commitment for insurance of its member share and deposit accounts under the provisions

of title II of the National Credit Union Act
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or from an approved credit union share guaranty

corporation
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.