Article 1. Merger of California Financial Code >> Division 5. >> Chapter 9. >> Article 1.
Any credit union may, with the approval of the commissioner,
merge with another credit union or with a central credit union.
(a) The merger shall be made pursuant to any plan agreed
upon by the majority of the board of directors of each credit union
joining in the merger, and approved by the affirmative vote of at
least a majority of the members of the disappearing credit union, in
person or by proxy, at a meeting of the members called for that
purpose or by written consent of a majority of the members of the
disappearing credit union. Notice of the meeting shall be given to
the members, either personally or by first-class mail, not less than
30 nor more than 90 days prior to the date of the meeting.
(b) The commissioner may approve a merger according to the plan
agreed upon by the majority of the board of directors of each credit
union, as set forth in subdivision (a), if the plan of merger is
approved by less than a majority of the membership as provided in
subdivision (a) if the commissioner finds, upon the written and
verified application filed by the board of directors, that (1) notice
of the meeting called to consider the merger or the ballot for
written vote on the merger was mailed to each member entitled to vote
upon the question, (2) the notice or ballot disclosed the purpose of
the meeting or the written vote, (3) the notice or ballot informed
the membership that approval of the merger might be sought pursuant
to this section, and (4) a majority of the votes cast upon the
question were in favor of the merger.
(c) Notwithstanding subdivisions (a) and (b), the commissioner may
approve a merger without a vote of the membership of the
disappearing credit union if a majority of the members of the board
of directors of the surviving credit union approves the merger, the
disappearing credit union is in danger of insolvency and the merger
would reduce the risk or avoid a threatened loss to the National
Credit Union Share Insurance Fund or other form of share guaranty or
insurance that is acceptable to the commissioner. For purposes of
this chapter, a credit union is insolvent when, from the most recent
available financial statements, it can be shown that the total amount
of its shares exceeds the present cash value of its assets after
providing for liabilities unless the commissioner finds all of the
(1) The facts that caused the deficient share-asset ratio no
(2) Further decline in the share-asset ratio is not probable.
(3) The return of the share-asset ratio to its normal limits
within a reasonable time for the credit union concerned is probable.
(4) The probability of a further potential loss is negligible to
the National Credit Union Share Insurance Fund or other form of share
guaranty or insurance that is acceptable to the commissioner.
(a) After the requirement of approval as provided in Section
15201 is satisfied, each credit union shall execute a certificate of
merger as an officers' certificate pursuant to Section 5062 of the
Corporations Code that shall set forth:
(1) That the plan of merger has been approved by the board of
(2) That the plan of merger has been duly approved by any required
vote of the members pursuant to Section 15201.
(3) The total number of members of the credit union.
(b) A copy of the plan of merger and of the written approval
thereof by the commissioner shall be annexed to the certificate of
(c) Nothing in this section requires a federal credit union to
execute or file the certificate of merger called for in subdivision
Each certificate of merger called for in Section 15202 shall
be filed in the office of the Secretary of State. After the filing
in the office of the Secretary of State, a copy of each certificate
of merger, certified by the Secretary of State, shall be filed with
the commissioner, and at that time the merger shall become effective
for all purposes.
(a) Upon any merger effectuated as provided in this article,
all property, property rights, and interests of the merged credit
union shall vest in the surviving credit union, without deed,
endorsement or other instruments of transfer, and all debts,
obligations and liabilities of the merged credit union are assumed by
the surviving credit union under whose charter the merger has been
effected. Thereafter the charter of the merged credit union is void,
and the existence of the merged credit union as a legal entity
separate from the surviving credit union terminates.
(b) Whenever a credit union having any real property in this state
merges with another credit union and vests that real property in the
surviving credit union, the filing for record in the office of the
county recorder of any county in this state in which any of the real
property of the disappearing credit union is located of the
certificates of merger and requisite attachments, as required by
Section 15202, shall evidence record ownership in the surviving
credit union of all interest of the disappearing credit union in and
to the real property located in that county.