18521.5
. (a) Notwithstanding Section 18521 or 18100.5, until July
1, 1990, each industrial loan company, other than a premium finance
agency, which has issued and has outstanding thrift obligations
shall, as a condition of its authority to continue to conduct
business under this division, have its outstanding thrift obligations
insured or guaranteed by Thrift Guaranty Corporation, or participate
as a member of the Federal Deposit Insurance Corporation; however,
each industrial loan company shall, as a condition of its authority
to continue to conduct business under this division, continue to
participate as a member or a special member as defined in Section
18476, in Thrift Guaranty Corporation in accordance with this chapter
and rules established by the Board of Directors of Thrift Guaranty
Corporation until it has paid assessments required by Section 18537.
(b) On and after July 1, 1990, each industrial loan company, other
than a premium finance agency, which has issued and has outstanding
thrift obligations, shall, as a condition of its authority to
continue to conduct business under this division, participate as a
member of the Federal Deposit Insurance Corporation.
(c) Any person not transacting the business of an industrial loan
company prior to the effective date of this section, who thereafter
commences business under the provisions of this division, shall, upon
commencement of its business, participate as a member of the Federal
Deposit Insurance Corporation.
(d) Thrift Guaranty Corporation shall have the power to seek
insurance, guarantee, or surety, with an insurer or surety, or
guarantor authorized to transact business in this state. The
insurance shall be subject to the approval of the commissioner after
consultation with the Insurance Commissioner. It is the intent of the
Legislature to permit Thrift Guaranty Corporation to seek insurance
and Thrift Guaranty Corporation's insurer to seek reinsurance. Thrift
Guaranty Corporation shall remain in existence after July 1, 1990,
to assist in the winding up, liquidation, or merger of industrial
loan companies unable to comply with the requirements of subdivision
(b) by that date. Thrift Guaranty Corporation shall continue to
guarantee outstanding thrift obligations sold and issued prior to
July 1, 1990, by an industrial loan company which has not complied
with the requirements of subdivision (b) by July 1, 1990, until all
outstanding thrift obligations have been redeemed by the issuer, a
successor to the issuer in compliance with the requirements of
subdivision (b), or Thrift Guaranty Corporation.
(e) In addition to any other provision of this section, if during
that period of time ending July 1, 1990, the United States Congress
or the Board of Governors of the Federal Reserve System adopt or
amend a law or regulations which pertain to an industrial loan
company applying for and obtaining membership in the Federal Deposit
Insurance Corporation, and the new federal law or regulations prevent
an industrial loan company from obtaining Federal Deposit Insurance
Corporation coverage solely because the company's holding company
status prevents Federal Deposit Insurance Corporation membership, a
successor to the Thrift Guaranty Corporation approved by the
commissioner, or some other institutional mechanism approved by the
commissioner, which obtains insurance in accordance with this
subdivision, may continue to discharge its function so long as the
insurance remains in effect.
(f) Within one year of the effective date of the act which adds
this section, and annually thereafter until July 1, 1990, the
commissioner shall report to the Legislature on the following:
(1) The progress of Thrift Guaranty Corporation in obtaining
reinsurance.
(2) The progress of licensees in converting to coverage by an
instrumentality of the United States government or by a private
insurer, surety, or guarantor.
(3) Recommendations for additional legislation if, in the
commissioner's opinion, additional legislation would be desirable to
encourage industrial loan companies to seek coverage for investment
certificates from sources other than Thrift Guaranty Corporation.
The commissioner shall submit special reports on these matters as
may be required by the circumstances.