Article 5. Credit Committee And Loan Officers of California Financial Code >> Division 5. >> Chapter 4. >> Article 5.
Every credit union shall have a credit committee of at least
three persons, each of whom shall be a member of the credit union,
or in the alternative, a credit manager, to have general supervision
of all obligations of members. The bylaws of the credit union shall
provide that either: (1) the members of the credit committee shall be
elected by the members of the credit union at their annual meeting,
or (2) they shall be appointed by the board of directors, or (3) that
the board of directors may establish the position of credit manager
in lieu of a credit committee. The bylaws of the credit union shall
provide for the terms of office of the credit committee, where the
credit committee has been provided for in the bylaws, which shall not
exceed three years, and which may be staggered.
No member of the credit committee or the credit manager or
any loan officer shall serve as a member of the supervisory
(a) (1) No credit union shall create any obligation with a
credit union member, without the written approval of a majority of
all the members of the credit committee, the credit manager, or a
loan officer appointed as provided in this section.
(2) Paragraph (1) does not apply to the creation of an obligation
in accordance with a credit scoring program, preapproval credit
program, or similar program, if the program was adopted by the board
of directors, credit committee, or credit manager and complies with a
written lending policy on programs of that type established by the
board of directors in accordance with Section 15100.
(b) The credit committee or the credit manager may, with the
approval of the board of directors, appoint one or more loan officers
who shall be authorized to approve obligations with credit union
(c) Neither the credit committee, a credit manager, or any loan
officer shall have the power to approve membership applications.
(d) No loan officers shall be permitted to approve any extension
agreement of any obligation or the refinancing of any obligation
except as prescribed in regulations promulgated by the commissioner.
(e) The credit committee, or in the alternative, the credit
manager shall be provided with a record of each obligation approved
or not approved by any loan officer, within 30 days of the approval
The credit committee, the credit manager, or a loan officer
may approve in advance, upon their own motion or upon the application
of any member, the extension of credit to any member and loans may
be granted to such member within the limit of such extension of
credit authorized by the board of directors pursuant to Section
15100. Where an extension of credit has been approved, applications
for any extension of credit need not be approved by the credit
committee, the credit manager, or loan officer as long as the
aggregate amount of such obligations does not exceed the limit of
such extension of credit authorized by the board of directors
pursuant to Section 15100. The credit committee, the credit manager,
or loan officer shall review, from time to time, all extensions of
credit approved by them and any extension of credit approved for any
member shall expire if such member becomes ineligible for a loan or
becomes more than 90 days delinquent in his obligations to the credit
A credit union member whose written application to enter
into any obligation is denied, may appeal from the denial of the
credit committee, the credit manager, or loan officer to the board of
A credit manager shall not disburse or have the authority to
authorize any person to disburse the proceeds of any loan. A credit
manager shall not authorize or make loans to other credit unions.