An Act to amend the Federal Credit Union Act
PL 86-354 (H.R.8305), enacted 09/22/1959

628 
PUBLIC LAW 86-364-SEPT. 22, 1969 
[73 STAT. 
Public Law 86-354 
September 22, 1959 
A N 
A C T 
FH R 
83051 
' 
To amend the Federal Credit Union Act. 
Federal C r e d i t 
Union Act. 
Be it enacted hy the Senate and House of Representatives 
of the 
United States of America in Congress assembled, That the Federal 
Credit Union Act (48 Stat. 1216; 12 U.S.C, sees. 1751-1772) is 
amended to read as follows: 
(( 
SHORT TITLE 
"SECTION 1. This Act may be cited as the 'Federal Credit Union 
Act'. 
"DEFINITIONS 
"SEC. 2. As used in this Act— 
"(1) the term 'Federal credit union' means a cooperative asso-
ciation organized in accordance with the provisions of this Act 
for the purpose of promoting thrift among its members and 
creating a source of credit for provident or productive purposes; 
"(2) the term 'Bureau' means the Bureau of Federal Credit 
Unions; and 
"(3) the term 'Director' means the Director of the Bureau of 
Federal Credit Unions. 
(( 
CREATION OF BUREAU 
"SEC. 3. There shall be in the Department of Health, Education, 
and Welfare a Bureau of Federal Credit Unions, which shall be under 
the supervision of a Director appointed by the Secretary of Health, 
Education and Welfare. 
The Bureau of Federal Credit Unions and 
the Director shall be under the general direction and supervision of 
the Secretary. 
"FEDERAL CREDIT UNION ORGANIZATION 
"SHC. 4. Any seven or more natural persons who desire to form a 
Federal credit union shall subscribe before some officer competent to 
administer oaths an organization certificate in duplicate which shall 
specifically state— 
" (1) the name of the association; 
"(2) the location of the proposed Federal credit union and 
the territory in which it will operate; 
" (3) the names and addresses of the subscribers to the certificate 
and the number of shares subscribed by each; 
'*(4^ the par value of the shares, which shall be $5 each; 
"(5) the proposed field of membership, specified in detail; 
" (6) the term of the existence of the corporation, which may be 
perpetual; and 
"(7) the fact that the certificate is made to enable such persons 
to avail themselves of the advantages of this Act. 
Such organization certificate may also contain any provisions 
approved by the Director for the management of the business of the 
association and for the conduct of its affairs and relative to the powers 
of its directors, officers, or stockholders. 
73 S T A T . ] 
PUBLIC LAW 86-364-SEPT. 22, 1959 
629 
a 
APPROVAL OF ORGANIZATION CERTIFICATE 
"SEC. 5. The organization certificate shall be presented to the 
Director 
for 
approval. 
Before 
any organization certificate 
is 
approved, an appropriate investigation shall be made for the purpose 
of determining (1) whether the organization certificate conforms to 
the provisions of this Act; (2) the general character and fitness of 
the subscribers thereto; and (3) the economic advisability of estab-
lishing the proposed Federal credit union. Upon approval of such 
organization certificate by the Director it shall be the charter of the 
corporation, and one of the originals thereof shall be delivered to the 
corporation after the payment of the fee required therefor. 
Upon 
such approval the Federal credit union shall be a body corporate and 
as such, subject to the limitations herein contained, shall be vested 
with all of the powers and charged with all of the liabilities conferred 
and imposed by this Act upon corporations organized hereunder. 
li FEES 
"SEC. 6. For the purpose of paying the costs incident to the ascer-
tainment of whether an organization certificate should be approved, 
the subscribers to any such certificate shall pay, at the time of filing 
their organization certificate, the amount prescribed by the Director, 
which shall not exceed $20 in any case; and on the approval of any 
organization certificate they shall also pay a fee of $5. Not later 
than January 31 of each calendar year, each Federal credit union 
shall pay to the Bureau, for the preceding calendar year, a super-
vision fee in accordance with a graduated scale prescribed by regula-
tion on the basis of assets as of December 31 of such preceding year, 
but such fee shall in no event be less than $10 nor more than the 
applicable amount specified in the following table: 
"Total assets 
Maximum fee 
$500,000 or less 
30 cents per $1,000. 
Over $500,000 and not over $1,000,000 
$150, plus 25 cents per $1,000 in 
excess of $500,000. 
Over $1,000,000 and not over $2,000,000 
$275, plus 20 cents per $1,000 in 
excess of $1,000,000. 
Over $2,000,000 and not over $5,000,000 
$475, plus 15 cents per $1,000 in 
excess of $2,000,000. 
Over .$5,000,000 
$925, plus 10 cents per $1,000 in 
excess of $5,000,000. 
All such fees shall be deposited with the Treasurer of the United 
States for the account of the Bureau and may be expended by the 
Director for such administrative, supervisory, and other expenses 
incurred in carrying out the provisions of this Act as he may deter-
mine to be proper, the purpose of such fees being to defray such 
expenses as far as practicable. 
No annual supervision fee shall be 
payable by a Federal credit union with respect to the year in which 
its charter is issued, or in which final distribution is made in its 
liquidation or the charter is otherwise canceled. 
"REPORTS AND 
EXAMINATIONS 
"SEC. 7. Federal credit unions shall be under the supervision of the 
Director, and shall make financial reports to him as and when he 
may require, but at least annually. 
Each Federal credit union shall 
be subject to examination by, and for this purpose shall make its books 
and records accessible to, any person designated by the Director. 
The 
Director shall fix a scale of examination fees to be paid by Federal 
credit unions, giving due consideration to the time and expense 
incident to such examinations, and to the ability of Federal credit 
680 
PUBLIC LAW 86-854-SEPT. 22, 1969 
[78 STAT. 
unions to pay such fees, which fees shall be assessed against and paid 
by each Federal credit union promptly after the completion of such 
examination. 
Examination fees collected under the provisions of 
this section shall be deposited to the credit of the special fund created 
by section 6, and shall be available for the purposes specified in such 
section. 
"POWERS 
"SEC. 8. A Federal credit union shall have succession in its corporate 
name during its existence and shall have power— 
"(1) to make contracts; 
" (2) to sue and be sued; 
"(3) to adopt and use a common seal and alter the same at 
pleasure; 
"(4) to purchase, hold, and dispose of property necessary or 
incidental to its operations; 
"(5) to make loans with maturities not exceeding five years to 
its members for provident or productive purposes upon such 
terms and conditions as this Act and its bylaws provide and as 
the credit committee or a loan officer may approve, at rates of 
interest not exceeding 1 per centum per month on unpaid bal-
ances, inclusive of all charges incident to making the loan; except 
that no loans to a director or member of the supervisory or 
credit committee shall exceed the amount of his holdings in the 
Federal credit union as represented by shares thereof plus the 
total unencumbered and unpledged shareholdings in the Federal 
credit union of any member pledged as security for the obligation 
of such director or committee member. 
No director or member 
of the supervisory or credit committee shall endorse for borrowers. 
A borrower may repay his loan, prior to maturity, in whole or 
in part on any business day. 
The taking, receiving, reserving, 
or charging of a rate of interest greater than is allowed by this 
paragraph, when knowingly done, shall be deemed a forfeiture 
of the entire interest which the note, bill, or other evidence of debt 
carries with it, or which has been agreed to be paid thereon. 
If 
such greater rate of interest has been paid, the person by whom 
it has been paid, or his legal representatives, may recover back 
from the credit union taking or receiving the same, in an action 
in the nature of an action of debt, the entire amount of interest 
paid; but such action must be commenced within two years from 
the time the usurious collection was made. Loans shall be paid 
or amortized in accordance with rules and regulations prescribed 
by the Director after taking into account the needs or conditions 
of the borrowers, the amounts and duration of the loans, the 
interests of the members and the credit unions, and such other 
factors as the Director deems relevant, but such rules and regu-
lations shall not require payments more frequently than annually; 
"(6) to receive from its members payments on shares; 
"(7) to invest its funds (A) in loans exclusively to members; 
(B) in obligations of the United States of America, or securities 
fully guaranteed as to principal and interest thereby; (C) in 
accordance with rules and regulations prescribed by the Director, 
in loans to other credit unions in the toal amount not exceeding 
25 per centum of its paid-in and unimpaired capital and surplus; 
or (D) in shares or accounts of savings and loan associations, the 
accounts of which are insured by the Federal Savings and Loan 
Insurance Corporation; 
78 S T A T . ] 
PUBLK3 LAW 86-8W-SBPT. 22.1969 
681 
"(8) to make deposits in national banks and in State banks, 
trust companies, and mutual savings banks operating in accord-
ance with the laws of the State in which the Federal credit union 
does business; 
"(9) to borrow, in accordance with such rules and regulations 
as may be prescribed by the Director, from any source, in an 
aggregate amount not exceeding 50 per centum or its paid-in and 
unimpaired capital and surplus: Provided^ That any Federal 
credit union may discount with or sell to any Federal inter-
mediate credit bank any eligible obligations up to the aiaount 
of its paid-in and unimpaired capital; 
"(10) to levy late charges, in accordance with the bylaws, for 
failure of members to meet promptly their obligations to the 
Federal credit union; 
"(11) to impress and eiiforce a lien upon the shares and divi-
dends of any member, to the extent of any loan made to him and 
any dues or charges payable by him; 
"(12) in accordance with rules and regulations prescribed by 
the Director, to sell to membsrs negotiable checks (including 
travelers checks) and monev orders, and to cash checks and 
money orders for members, tor a fee which does not exceed the 
direct and indirect costs incident to providing such service; and 
"(13) to exercise such incidental powers as shall be necessary 
or requisite to enable it to carry on effectively the business for 
which it is incorporated. 
"BYLAWS 
"SEC. 9. In order to simplify the organization of Federal credit 
unions the Director shall from time to time cause to be prepared a form 
of organization certificate and a form of bylaws, consistent with this 
Act, which shall be used by Federal credit union incorporators, and 
shall be supplied to them on request. At the time of presenting the 
organization certificate the incorporators shall also submit proposed 
bylaws to the Director for hib approval. 
"MEMBERSHIP 
"SEC. 10. Federal credit union membership shall consist of the 
incorporators and such other persons and incorporated and unincor-
porated organizations, to the extent permitted by rules and regulations 
prescribed by the Director, as may be elected to membership and as 
such shall each, subscribe to at least one share of its stock and pay the 
initial installment thereon and the entrance fee; except that Federal 
credit union membership shall be limited to groups having a common 
bond of occupation or association, or to groups within a well-defined 
neighborhood, community, or rural district. Shares may be issued in 
joint tenancy with right of survivorship with any persons designated 
by the credit union member, but no joint tenant shall be permitted 
to vote, obtain loans, or hold office, unless he is within the field of 
membership and is a qualified member. 
"MEMBERS' MEETINGS 
"SEC. 11. The fiscal year of all Federal credit unions shall end 
December 31. The annual meeting of each Federal credit union shall 
be held at such time during the month of the following January and 
at such place as its bylaws shall prescribe. 
Special meetings may 
be held in the manner indicated m the bylaws. 
No member shall 
be entitled to vote by proxy, but a member other than a natural person 
632 
PUBLIC LAW 86.364-8EPT. 22, 1969 
[78 STAT. 
may vote through an agent designated for the purpose. Irrespective 
of the number of shares held by him, no member shall have more than 
one vote. 
"MANAGEMENT 
"SEO. 12. The business affairs of a Federal credit union shall be 
managed by a board of not less than five directors, and a credit com-
mittee of not less than three members, all to be elected at the annual 
members' meeting by and from the members, and by a supervisory 
committee of three members, one of whom may be a director other than 
the treasurer, to be appointed by the board. Any vacancy occurring 
in the supervisory committee shall be filled in the same manner as 
original appointments to such committee. All members of the board 
and of such committees shall hold office for such terms, respectively, 
as the bylaws may provide. A record of the names and addresses oi 
the members of the board and such committees and of the officers of the 
credit union shall be filed with the Bureau within ten days after their 
election or appointment. No member of the board or of either such 
committee shall, as such, be compensated. 
"OFFICERS 
"SEC. 13. At their first meeting after the annual meeting of the 
members, the directors shall elect from their number a president, one 
or more vice presidents, a secretary, and a treasurer, who shall be the 
executive officers of the corporation. No executive officer, except the 
treasurer, shall be compensated as such. The offices of secretary and 
treasurer may be held by the same person. The duties of the officers 
shall be as determined by the bylaws, except that the treasurer shall 
be the general manager of the corporation. Before the treasurer shall 
enter upon his duties he shall give bond with good and sufficient 
surety, m an amount and character to be determined by the board of 
directors in compliance with regulations prescribed from time to time 
by the Director, conditioned upon the faithful performance of his 
trust. 
(( 
DIRECTORS 
"SEC. 14. The board of directors shall meet at least once a month 
and shall have the general direction and control of the affairs of the 
corporation. Minutes of all such meetings shall be kept. Among other 
things they shall act upon applications for membership; require any 
officer or employee having custody of or handling funds to give bond 
with good and sufficient surety in an amount and character to be de-
termined by the board of directors in compliance with regulations 
prescribed from time to time bjr the Director, and authorize the pay-
ment of the premium or premiums therefor from the funds of the 
Federal credit union; fill vacancies in the board and in the credit com-
mittee until successors elected at the next annual meeting have qual-
ified j have charge of investments other than loans to members; de-
termine from time to time the maximum number of shares that may 
be held by an individual; subject to the limitations of this Act, deter-
mine the interest rates on loans and the maximum amount which may be 
loaned with or without security to any member; subject to such regu-
lations as may be issued by the Director, authorize an interest refund 
to members of record at the close of business on December 31 in pro-
portion to the interest paid by them during that year; and provide 
tor compensation of necessary clerical and auditing assistance re-
quested by the supervisory committee, and of loan officers appointed 
by the credit committee. The board may appoint an executive com-
73 S T A T . ] 
PUBLIC LAW 8 6 - 3 6 4 - S E P T . 22, 1969 
683 
mittee of not less than three directors to act for it in the purchase and 
sale of securities or the making of loans to other credit unions, or both. 
Such executive committee or a membership officer appointed by the 
board from among the members of the credit union, other than the 
treasurer, an assistant treasurer, or a loan officer, may be authorized by 
the board to approve applications for membership under such condi-
tions as the board may prescribe; except that such committee or mem-
bership officer so authorized shall submit to the board at each monthly 
meeting a list of approved or pending applications for membership 
received since the previous monthly meeting, together with such other 
related information as the bylaws or the board may require. 
"CREDIT COMMITTEE 
"SEC. 15. The credit committee shall hold such meetings as the busi-
ness of the Federal credit union may require and not less frequently 
than once a month to consider applications for loans. 
Eeasonable 
notice of such meetings shall be given to all members of the committee. 
No loan shall be made unless it is approved by a majority of the entire 
committee and by all members of the committee who are present at 
the meeting at which the application is considered; except that the 
credit committee may appoint one or more loan officers, and delegate 
to him or them the power to approve loans up to the unsecured limit, 
or in excess of such limit if such excess is fully secured by unpledged 
shares. 
Each loan officer shall furnish to the credit committee a 
record of each loan approved or not approved by him within seven 
days of the date of the filing of the application therefor. All loans 
not approved by a loan officer shall be acted upon by the credit com-
mittee. No individual shall have authority to disburse funds of the 
Federal credit union for any loan which has been approved by him in 
his capacity as a loan officer. Not more than one member of the credit 
committee may be appointed as a loan officer. Applications for loans 
shall be made on forms prepared by such committee, which shall set 
forth the purpose for which the loan is desired, the security, if any, 
and such other data as may be required. No loan shall be made to any 
member which causes such memt^r to become indebted to the Federal 
credit union in an aggregate amount, upon loans made to such mem-
ber, which is in excess of $200 or 10 per centum of the credit union's 
paid-in unimpaired capital and surplus, whichever is greater, or in 
excess of $750 unless such excess over $750 is adequately secured. 
For 
the purposes of this section an assignment of shares or the endorse-
ment of a note shall be deemed security. 
"SUPERVISORY COMMITTEE 
"SEC. 16. The supervisory committee shall make or cause to be made, 
at least quarterly, an examination of the affairs of the Federal credit 
union, including an audit of its books; shall make or cause to be made 
a report of its quarterly examination to the board of directors; shall 
make or cause to be made an annual audit, a report of which shall be 
submitted to the members at the next annual meeting of the corpora-
tion ; may suspend by a unanimous vote any officer of the corporation 
or any member of the credit committee or of the board of directors, 
until the next members' meeting, which members' meeting shall be 
held not less than seven nor more than fourteen days after such 
suspension and at which meeting such suspension shall be acted upon by 
the members; and may call by a majority vote a special meeting of the 
shareholders to consider any violation of this Act, the charter, or the 
bylaws, or any practice of the corporation deemed by the supervisory 
committee to be unsafe or unauthorized. Any memlber of the super-
634 
PUBUC LAW 86-8B4-SEPT. 22, 196d 
[78 STAT. 
visory committee may be suspended by the board of directors. The 
members shall decide, at a meeting held not less than seven nor more 
than fourteen days after any such suspension, whether the suspended 
committee member shall be removed from or restored to the super-
visory committee. The supervisory committee shall cause the pass-
books and accounts of the members to be verified with the records of 
the treasurer from time to time, and not less frequently than once 
every two years. As used in this section, the term 'passbook' shall 
include any book, statement of account, or other record approved by 
the Director for use by Federal credit unions. 
(( 
RESERVES 
"SEC. 17. All entrance fees and charges provided by the bylaws and 
20 per centum of the net earnings of each dividend period, before the 
declaration of anv dividends, shall be set aside as a regular reserve 
against losses on bad loans and such other losses as may be specified 
in the bylaws in accordance with regulations prescribed under this 
Act: Provided^ however^ That when the regular reserve thus estab-
lished shall equal 10 per centum of the total amount of members' 
shareholdings, no further transfer of net earnings to such regular 
reserve shall be required except that such amounts not in excess of 
20 per centum of the net earnings as may be needed to maintain this 
10 per centum ratio shall continue to be transferred. 
In addition to 
such regular reserve, special reserves to protect the interests of mem-
bers shall be established when required (1) by regulation, or (2) in 
any special case, when found by the Director to be necessary for that 
purpose. 
"DIVIDENDS 
"SEC. 18. Annually or semiannually, as the bylaws may provide, 
and after provision for the required reserves, the board of directors 
may declare a dividend to be paid from the remaining net earnings. 
Such dividends shall be paid on all paid-up shares outstanding at the 
end of the period for which the dividend is declared. 
Shares which 
become fully paid up during such dividend period and are outstanding 
at the close of the period shall be entitled to a proportional part of such 
dividend. 
Dividend credit for a month may be accrued on shares 
which are or become fully paid up during the first five days of that 
month. 
u. 
EXPULSION AND WITHDRAWAL 
"SEC. 19. A member may be expelled by a two-thirds vote of the 
members of a Federal credit union present at a special meeting called 
for the purpose, but only after an opportunity has been given him to 
be heard. 
Withdrawal or expulsion of a member shall not operate to 
relieve him from liability to the Federal credit union. 
The amount to 
be paid a withdrawing or expelled member by a Federal credit union 
shall be determined and paid in the manner specified in the bylaws. 
(C 
MINORS 
"SEC. 20. Shares may be issued in the name of a minor or in trust, 
subject to such conditions as may be prescribed b j the bylaws. 
When 
shares are issued in trust, the name of the beneficiary shall be disclosed 
to the Federal credit union. 
73 S T A T . ] 
P U B U C LAW 86-364-8EPT. 22, 1969 
'•CERTAIN POWERS OF 
DIRECTOR 
"SEC. 21. (a) The Director may prescribe rules and regulations for 
the administration of this Act (including, but not by way of limita-
tion, the merger, consolidation, and dissolution of corporations 
organized under this Act). 
"(b)(1) The Director may suspend or revoke the charter of any 
Federal credit union, or place the same in involuntary liquidation and 
appoint a liquidating agent therefor, upon his finding that the organ-
ization is bankrupt or insolvent, or has violated any of the provisions 
of its charter, its bylaws, this Act, or any regulations issued 
thereunder. 
"(2) The Director, through such persons as he shall designate, may 
examine any Federal credit union in voluntary liquidation and, upon 
his finding that such voluntary liquidation is not being conducted in 
an orderly or efficient manner or in the best interests of its members, 
may terminate such voluntary liquidation and place such organization 
in involuntary liquidation and appoint a liquidating agent therefor. 
"(3) Such liquidating agent shall have power and authority, sub-
ject to the control and supervision of the Director and under such 
rules and regulations as the Director may prescribe, (A) to receive 
and take possession of the books, records, assets, and property of every 
description of the Federal credit union in liquidation, to sell, enforce 
collection of, and liquidate all such assets and property, to compound 
all bad or doubtful debts, and to sue in his own name or in the name 
of the Federal credit union in liquidation, and defend such actions 
as may be brought against him as liquidating agent or against the 
Federal credit union; (B) to receive, examine, and pass upon all 
claims against the Federal credit union in liquidation, including claims 
of members on shares; (C) to make distribution and payment to 
creditors and members as their interests may appear; and (D) to 
execute such documents and papers and to do such other acts and 
things which he may deem necessary or desirable to discharge his 
duties hereunder. 
"(4) Subject to the control and supervision of the Director and 
under such rules and regulations as the Director may prescribe, the 
liquidating agent of a Federal credit union in involuntary liquidation 
shall (A) cause notice to be given to creditors and members to present 
their claims and make legal proof thereof, which notice shall be 
published once a week in each of three successive weeks in a newspaper 
of general circulation in each county in which the Federal credit 
union in liquidation maintained an office or branch for the transaction 
of business on the date it ceased unrestricted operations; except that 
whenever the aggregate book value of the assets and property of a 
Federal credit union in involuntary liquidation is less than $1,000, 
unless the Director shall find that its books and records do not contain 
a true and accurate record of its liabilities, he shall declare such 
Federal cpedit union in liquidation to be a 'no publication' liquidation, 
and publication of notice to creditors and members shall not be 
required in such case; (B) from time to time make a ratable dividend 
on all such claims as may have been proved to his satisfaction or adjudi-
cated in a court of competent jurisdiction and, after the assets of such 
organization have been liquidated, make further dividends on all claims 
previously proved or adjudicated, and he may accept in lieu of a 
formal proof of claim on behalf of any creditor or member the state-
ment of any amount due to such creditor or member as shown on the 
books and records of the credit union; but all claims not filed before 
payment of the final dividend shall be barred and claims rejected or 
disallowed by the liquidating agent shall be likewise barred unless 
32716 O-60—43 
PUBLIC LAW 86-364-8EPT. 22, 1969 
[73 STAT. 
suit be instituted thereon within three months after notice of rejec-
tion or disallowance; and (C) in a 'no publication' liquidation, deter-
mine from all sources available to him, and within the limits of 
available funds of the Federal credit union, the amounts due to credi-
tors and members, and after sixty days shall have elapsed from the 
date of his appointment distribute the funds of the Federal credit 
union to creditors and members ratably and as their interests may 
appear. 
"(5) Upon certification by the liquidating agent in the case of an 
involuntary liquidation, and upon such proof as shall be satisfactory 
to the Director in the case of a voluntary liquidation, that distribution 
has been made and that liquidation has been completed, as provided 
herein, the Director shall cancel the charter of such Federal credit 
imion; but the corporate existence of the Federal credit union shall 
continue for a period of three years from the date of such cancellation 
of its charter, during which period the liquidating agent, or his duly 
appointed successor, or such persons as the Director shall designate, 
ma;^ act on behalf of the Federal credit union for the purpose of 
paying, satisfying, and discharging any existing liabilities or obliga-
tions, collecting and distributing its assets, and doing all other acts 
required to adjust and wind up its business and affairs, and it may 
sue and be sued in its corporate name. 
"(c) After the expiration of five years from the date of cancellation 
of the charter of a Federal credit union the Director may, in his dis-
cretion, destroy any or all books and records of such Federal credit 
union in his possession or under his control. 
"(d) The Director is authorized and empowered to execute any and 
all functions and perform any and all duties vested in him hereby, 
through such persons as he shall designate or employ; and he may 
delegate to any person or persons, including any institution operating 
under the general supervision of the Bureau, the performance and dis-
charge of any authority, power, or function vested in him by this Act. 
"(e) All books and records of Federal credit unions shall be kept 
and reports shall be made in accordance with forms approved by the 
Director. 
"(f) The Director is authorized to make investigations and to con-
duct researches and studies of the problems of persons of small means 
in obtaining credit at reasonable rates of interest, and of the methods 
and benefits of cooperative saving and lending among such persons. 
He is further authorized to make reports of such investigations and 
to publish and disseminate the same. 
"(g) Any officer or employee of the Bureau is authorized, when 
designated for the purpose by the Director, to administer oaths and 
affirmations and to take affidavits and depositions touching upon any 
matter within the jurisdiction of the Bureau. 
"(h) The Director is authorized, empowered, and directed to require 
that every person appointed or elected by any Federal credit union to 
any position requiring the receipt, payment, or custody of money or 
other personal property owned by a Federal credit union, or in its 
custody or control as collateral or otherwise, give bond in a corporate 
surety company holding a certificate of authority from the Secretary 
61 Stat. 648. 
^f ^j^^ Trcasury under the Act approved July 30,1947 (6 U.S.C., sees. 
6-13), as an acceptable surety on Federal bonds. Any such bond or 
bonds shall be in a form approved by the Director with a view to pro-
viding surety coverage to the Federal credit union with reference to 
loss by reason of acts of fraud or dishonesty including forgery, theft, 
embezzlement, wrongful abstraction, or misapplication on the pai*t 
of the person, directly or through connivance with others, and such 
other surety coverages as the Director may determine to be reasonably 
73 S T A T . ] 
PUBLIC LAW 86-364-SEPT. 22, 1959 
637 
appropriate or as elsewhere required by this Act. Any such bond or 
bonds shall be in such an amount in relation to the money or other 
personal property involved or in relation to the assets of the Federal 
credit union as the Director may from time to time prescribe by 
regulation for the purpose of requiring reasonable coverage. 
In lieu 
of individual bonds the Director may approve the use of a form of 
schedule or blanket bond which covers all of the officers and employees 
of a Federal credit union whose duties include the receipt, payment, 
or custody of money or other personal property for or on behalf of 
the Federal credit union. The Director may also approve the use of a 
form of excess coverage bond whereby a Federal credit union may 
obtain an amount of coverage in excess of the basic surety coverage. 
"FISCAL AGENTS AND DEPOSITORIES 
"SEC. 22. Each Federal credit union organized under this Act, when 
requested by the Secretary of the Treasury, shall act as fiscal agent of 
the United States and shall perform such services as the Secretary of 
the Treasury may require in connection with the collection of taxes 
and other obligations due the United States and the lending, borrow-
ing, and repayment of money by the United States, including the 
issue, sale, redemption, or repurchase of bonds, notes. Treasury certifi-
cates of indebtedness, or other obligations of the United States; and 
to facilitate such purposes the Director shall furnish to the Secretary 
of the Treasury from time to time the names and addresses of all 
Federal credit unions with such other available information concern-
ing them as may be requested by the Secretary of the Treasury. Any 
Federal credit union organized under this Act, when designated for 
that purpose by the Secretary of the Treasury, shall be a depository of 
public money, except receipts from customs, under such regulations 
as may be prescribed by the Secretary of the Treasury. 
a, 
TAXATION 
"SEC. 23. The Federal credit unions organized hereunder, their 
property, their franchises, capital, reserves, surpluses, and other funds, 
and their income shall be exempt from all taxation now^ or hereafter 
imposed by the United States or by any State, Territorial, or local 
taxing authority; except that any real property and any tangible 
jiersonal property of such Federal credit unions shall be subject to 
Federal, State, Territorial, and local taxation to the same extent as 
other similar property is taxed. 
Nothing herein contained shall pre-
vent holdings in any Federal credit union organized hereunder from 
being included in the valuation of the personal property of the 
owners or holders thereof in assessing taxes imposed by authority 
of the State or political subdivision thereof in which the Federal 
credit union is located; but the duty or burden of collecting or 
enforcing the payment of such a tax shall not be imposed upon any 
such Federal credit union and the tax shall not exceed the rate of taxes 
imposed upon holdings in domestic credit unions. 
"PARTIAL INVALIDITY; RIGHT TO AMEND 
"SEC. 24. (a) If any provision of this Act, or the application thereof 
to any person or circumstance, is held invalid, the remainder of the 
Act, and the application of such provision to other persons or circum-
stances, shall not be affected thereby. 
"(b) The right to alter, amend, or repeal this Act or any part 
thereof, or any charter issued pursuant to the provisions of this Act, 
is expressly reserved. 
<B8 
PUBLIC LAW 86-364-SEPT. 22, 1969 
[73 STAT. 
"SPACE IN FEDERAL BUILDINGS 
"SEC. 25. Upon application by any credit union organized under 
State law or by any Federal credit union organized in accordance 
with the terms of this Act, at least 95 per centum of the membership 
of which is composed of persons who either are presently Federal 
employees or were Federal employees at the time of admission into 
the credit union, and members of their families, which application 
shall be addressed to the officer or agency of the United States charged 
with the allotment of space in the Federal buildings in the community 
or district in which such credit union does business, such officer or 
agency may in his or its discretion allot space to such credit union if 
space is available without charge for rent or services. 
"CONVERSION FROM FEDERAL TO STATE CREDIT UNION AND FROM STATE TO 
FEDERAL CREDIT UNION 
"SEC. 26. (a) A Federal credit union may be converted into a State 
credit union under the laws of any State, the District of Columbia, 
the several Territories and possessions of the United States, the 
Panama Canal Zone, or the Commonwealth of Puerto Rico, by com-
plying with the following requirements: 
"(1) The proposition for such conversion shall first be approved, 
and a date set for a vote thereon by the members (either at a meeting 
to be held on such date or by written ballot to be filed on or before 
such date), by a majority of the directors of the Federal credit union. 
Written notice of the proposition and of the date set for the vote shall 
then be delivered in person to each member, or mailed to each mem-
ber at the address for such member appearing on the records of the 
credit union, not more than thirty nor less than seven days prior to 
such date. 
Approval of the proposition for conversion shall be by 
the affirmative vote of a majority of the members, in person or in 
writing. 
"(2) A statement of the results of the vote, verified by the affidavits 
of the president or vice president and the secretary, shall be filed with 
the Bureau within ten days after the vote is taken. 
"(3) Promptly after the vote is taken and in no event later than 
ninety days thereafter, if the proposition for conversion was approved 
by such vote, the credit union shall take such action as. may be neces-
sary under the applicable State law to make it a State credit union, 
and within ten days after receipt of the State credit union charter 
there shall be filed with the Bureau a copy of the charter thus issued. 
Upon such filing the credit union shall cease to be a Federal credit 
union. 
"(4) Upon ceasing to be a Federal credit union, such credit union 
shall no longer be subject to any of the provisions of this Act. The 
successor State credit union shall be vested with all of the assets and 
shall continue responsible for all of the obligations of the Federal 
credit union to the same extent as though the conversion had not taken 
place. 
"(b)(1) A State credit union, organized under the laws of any 
State, the District of Columbia, the several Territories and possessions 
of the United States, the Panama Canal Zone, or the Commonwealth 
of Puerto Rico, may be converted into a Federal credit union by (A) 
complying with all State requirements requisite to enabling it to 
convert to a Federal credit union or to cease being a State credit union, 
(B) filing with the Bureau proof of such compliance, satisfactory to 
the Director, and (C) filing with the Bureau an organization certifi-
cate as required by this Act. 
73 S T A T . ] 
P U B U C LAW 86-356-SEPT. 22, 1959 
"(2) When the Director has been satisfied that all of such require-
ments, and all other requirements of this Act, have been complied with, 
the Director shall approve the organization certificate. Upon such 
approval, the State credit union shall become a Federal credit union 
as of the date it ceases to be a State credit union. The Federal credit 
union shall be vested with all of the assets and shall continue responsi-
ble for all of the obligations of the State credit union to the same extent 
as though the conversion had not taken place. 
"TERRITORIAL APPLICABILITY OF ACT 
"SEC. 27. The provisions of this Act shall apply to the several 
States, the District of Columbia, the several Territories and posses-
sions of the United States, the Panama Canal Zone, and the Common-
wealth of Puerto Rico." 
SEC. 2. Section 2113(g) of title 18 of the United States Code is 
amended by inserting before the period at the end thereof ", and any 
"Federal credit union' as defined in section 2 of the Federal Credit 
Union Act". 
SEC. 3. The Director of the Bureau of Federal Credit Unions shall 
make a study of the desirability of providing for federally chartered 
central credit unions, and shall submit to the Secretary of Health, 
Education, and Welfare, for transmission to the Congress on or before 
April 15, 1960, a report of the results thereof and such recommenda-
tions for legislation thereon as the Director deems appropriate. 
Approved September 22, 1959. 
62 Stat. 796. 
Report to 
gress. 
Con-
Public Law 86-355 
AN ACT 
To authorize the Secretary of the Army to lease a portion of Twin Cities Arsenal, 
Minnesota, to Independent School District Numbered 16, Minnesota. 
September 22, 1959 
[H. R. 2449] 
Be it enacted, hy the Senate and House of Representatives 
of the 
United States of America in Congress asseinbled, That the Secretary 
of the Army is authorized and directed to lease for a two-year period 
to the Independent School District Numbered 16, State of Minnesota 
(Spring Lake Park School District) space it occupies in Building 
Numbered 105, and adjacent land area at the Twin Cities Arsenal, 
Minneapolis, Minnesota, subject, however, to conditions and restric-
tions set forth in sections 2, 4, and 5 of this Act. 
SEC. 2. The lease authorized by this Act shall be made upon condi-
tion that the lessee pay the cost of utilities or other special services 
furnished the lessee by the Government, and upon condition that the 
property shall be used for the operation and maintenance of a public 
school only and in the event that it shall not be used for such purpose 
the lease shall immediately terminate and title to all improvements 
made by the school district during its occupancy shall vest in the 
United States without compensation therefor. The lease shall further 
provide that the school district shall at all times keep the premises 
m good repair; that use of the premises shall be subject to regulations 
by the commanding officer of the arsenal and shall in no way interfere 
with operations of the United States; that no change shall be made in 
the building or grounds without the prior consent of the district 
engineer, United States Army Engineer District, St. Paul, Minnesota; 
that no claim shall be made against the United States by the school dis-
trict for damage to any of its property on the premises; that the school 
district will protect the United States against any claim, for personal 
Twin Cities Ar-
senal, Minn. 
Lease. 
Conditions.