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2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:591. Private trust company

RS 6:591 - Private trust company
A. A private trust company engaging in the trust business in this state shall comply with every provision of this Chapter applicable to a trust company, unless expressly exempted therefrom, in writing by the commissioner pursuant to this Section or by rule adopted by the commissioner.
B. A private trust company or proposed private trust company may request in writing that it be exempted from specified provisions of this Chapter. The commissioner may grant the exemption in whole or in part if the commissioner finds that the private trust company does not and will not transact business with the general public. For purposes of this Section, "transact business with the general public" means any sales, solicitations, arrangements, agreements, or transactions to provide trust or other business services, whether or not for a fee, commission, or any other type of remuneration, with any client that is not a family member or a sole proprietorship, partnership, joint venture, association, trust, estate, business trust, or other company that is not completely owned by one or more family members. For purposes of this Section, "family member" means any individual who is related within the fourth degree of affinity or consanguinity to an individual or individuals who control a private trust company or which is controlled by one or more trusts or charitable organizations established by such individual or individuals.
C. All individuals who control a private trust company or establish trusts or charitable organizations controlling such private trust company must be related within the second degree of affinity or consanguinity.
D. At the expense of the private trust company, the commissioner may examine or investigate the private trust company in connection with an application for exemption. Unless the application presents novel or unusual questions, the commissioner shall approve the application for exemption or set the application for hearing not later than the sixty-first day after the date the commissioner considers the application complete and accepted for filing. The commissioner may require the submission of additional information as considered necessary to an informed decision.
E. Any exemption granted under this Part may be subject to conditions or limitations imposed by the commissioner consistent with this Chapter.
F. The commissioner may adopt rules defining other circumstances that do not constitute transaction of business with the public, specifying the provisions of this Chapter that are subject to an exemption request, and establishing procedures and requirements for obtaining, maintaining, or revoking exempt status.
Acts 2003, No. 573, §1, eff. June 27, 2003.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:593. Conversion to public trust company

RS 6:593 - Conversion to public trust company
A. A private trust company may terminate its status as a private trust company and commence transacting business with the general public upon compliance with this Section. A private trust company desiring to commence transacting business with the general public shall file a notice on a form prescribed by the commissioner, which shall set forth the name of the private trust company and an acknowledgment that any exemption granted or otherwise applicable to the private trust company pursuant to this Part shall cease to apply on the effective date of such notice, furnish a copy of the resolution adopted by the board authorizing the private trust company to commence transacting business with the general public, and pay the filing fee, if any, prescribed by the commissioner.
B. The trust company may commence transacting business with the general public on the thirty-first day after the date the commissioner receives the notice, unless the commissioner specifies an earlier or later date. The thirty-day period of review may be extended by the commissioner upon a determination that the written notice raises issues that require additional information or additional time for analysis. If the period for review is extended, the trust company may commence transacting business with the public only on prior written approval by the commissioner.
C. The commissioner may deny a private trust company's request to commence transacting business with the general public if the commissioner finds that the private trust company lacks sufficient financial resources to undertake the proposed expansion without adversely affecting its safety or soundness, or that the proposed transacting of business with the general public would be contrary to the public interest, or if the commissioner determines that the private trust company will not, within a reasonable period of time, be in compliance with any provision of this Chapter from which the private trust company had been previously exempt.
Acts 2003, No. 573, §1, eff. June 27, 2003.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:601. Investment in trust company facilities

RS 6:601 - Investment in trust company facilities
A. In this Part, "trust company facility" means real estate, including an improvement, owned, or leased to the extent the lease or the leasehold improvements are capitalized, by a trust company for the purpose of providing space for trust company employees to perform their duties and space for parking by trust company employees and customers conducting trust business, including meeting the reasonable needs and convenience of the trust company's customers, computer operations, document and other item processing, maintenance and record retention and storage, holding, improving, and occupying as an incident to future expansion of the trust company's facilities, or conducting another activity authorized by the commissioner and permitted under this Chapter.
B. A trust company shall comply with generally accepted accounting principles, consistently applied, in accounting for its investment in and depreciation of trust company facilities, furniture, fixtures, and equipment.
Acts 2003, No. 573, §1, eff. June 27, 2003.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:602. Other real estate

RS 6:602 - Other real estate
A. A trust company may acquire real estate only as permitted by this Part, including rules adopted under this Part, and with the prior written approval of the commissioner.
B. To the extent reasonably necessary to avoid or minimize loss on real estate acquired as permitted by Subsection A of this Section, a trust company may exchange real estate for other real estate or personal property, invest additional funds in or improve real estate acquired under this Subsection or Subsection A of this Section.
C. A trust company may hold other real estate in perpetuity if the property is not being operated by the trust company as a going concern, and the property has been written down to the value of one dollar on the trust company's books.
D. For properties not meeting the requirements of Subsection C of this Section, the trust company must file a divestiture plan with the commissioner outlining its plan to divest itself of the property within a reasonable time period.
Acts 2003, No. 573, §1, eff. June 27, 2003.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:611. Securities

RS 6:611 - Securities
A. A trust company may invest its corporate funds in any type or character of equity or investment securities subject to the limitations provided by this Part.
B. Unless the commissioner approves maintenance of a lesser amount in writing, a trust company shall maintain an amount equal to at least forty percent of its capital under R.S. 6:574 in unencumbered cash, cash equivalents, and readily marketable securities.
C. Subject to Subsection D of this Section, the total investment in equity and investment securities of any one issuer, obligor, or maker, held by the trust company for its own account, may not exceed an amount equal to fifteen percent of the trust company's capital. The commissioner may authorize investments in excess of this limitation on written application if the commissioner concludes that the excess investment is not prohibited by other applicable law, and that the safety and soundness of the requesting trust company is not adversely affected.
D. Notwithstanding Subsection C of this Section, a trust company may purchase for its own account, without limitation and subject only to the exercise of prudent judgment, any of the following:
(1) Bonds and other legally created general obligations of an agency or political subdivision of a state, the United States, or an agency or instrumentality of the United States.
(2) An investment security that this state, an agency or political subdivision of the United States, or an agency or instrumentality of the United States has unconditionally agreed to purchase, insure, or guarantee.
(3) Securities that are offered and sold under 15 U.S.C. Section 77d(5).
(4) Mortgage-related securities as defined in 15 U.S.C. Section 78c(a), except that notwithstanding Section 347 of the Riegle Community Development and Regulatory Improvement Chapter of 1994, a note or obligation that is secured by a first lien on one or more parcels of real estate on which is located one or more commercial structures is subject to the limitations of Subsection C of this Section.
(5) Investment securities issued or guaranteed by the Federal Home Loan Mortgage Corporation, the Federal National Mortgage Association, the Government National Mortgage Association, the Federal Agricultural Mortgage Association, or the Federal Farm Credit Banks Funding Corporation.
(6) Investment securities issued or guaranteed by the North American Development Bank.
(7) Securities issued by a Federal Home Loan Bank.
E. Notwithstanding 15 U.S.C. Section 77r-1(c), Subsection C of this Section applies to investments in small business-related securities as defined by 15 U.S.C. Section 78c(a).
Acts 2003, No. 573, §1, eff. June 27, 2003.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:612. Transactions in trust company shares or participation shares

RS 6:612 - Transactions in trust company shares or participation shares
A. A trust company may acquire its own shares or participation shares if the amount of its undivided profits is sufficient to absorb fully the acquisition of the shares or participation shares under regulatory accounting principles, or if the trust company obtains the prior written approval of the commissioner.
B. A trust company may acquire a lien upon its own shares or participation shares if the aggregate amount of indebtedness so secured is less than the amount of the trust company's undivided profits, or the trust company obtains the prior written approval of the commissioner.
Acts 2003, No. 573, §1, eff. June 27, 2003.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:613. Subsidiaries

RS 6:613 - Subsidiaries
A. Except as otherwise provided by this Chapter or rules adopted under this Chapter, a trust company may acquire or establish a subsidiary to conduct any activity that may lawfully be conducted through the form of organization chosen for the subsidiary.
B. A trust company may not invest more than an amount equal to fifteen percent of its capital in a single subsidiary and may not invest an amount in excess of its capital in all subsidiaries. The amount of a trust company's investment in a subsidiary is the total amount of the trust company's investment in equity or investment securities issued by its subsidiary and any loans and extensions of credit from the trust company to its subsidiary. The commissioner may authorize investments in excess of these limitations upon written application, if the commissioner concludes that the excess investment is not prohibited by other applicable law, and the safety and soundness of the trust company is not adversely affected.
C. A trust company may acquire or establish a subsidiary or begin performing new activities in an existing subsidiary only with the prior written approval of the commissioner. The request to establish the subsidiary or exercise new activities in a subsidiary shall be filed on a form prescribed by the commissioner and accompanied by any applicable fee as established by rule.
D. A subsidiary of a trust company is subject to regulation by the commissioner to the extent provided by this Chapter or rules adopted under this Chapter. In the absence of limiting rule or regulation, the commissioner may regulate a subsidiary as if it were a trust company.
Acts 2003, No. 573, §1, eff. June 27, 2003.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:614. Mutual funds

RS 6:614 - Mutual funds
A. A trust company may invest for its own account in equity securities of an investment company registered under the Investment Company Chapter of 1940 (15 U.S.C. Section 80a-1 et seq.) and the Securities Chapter of 1933 (15 U.S.C. Section 77a et seq.) if the portfolio of the investment company consists wholly of investments in which the trust company could invest directly for its own account.
B. If the portfolio of an investment company described in R.S. 6:611(D) consists wholly of investments in which the trust company could invest directly without limitation under this Chapter, the trust company may invest in the investment company without limitation.
C. If the portfolio of an investment company described in Subsection A of this Section contains any investment that is subject to the limits of R.S. 6:611(C), the trust company may invest in the investment company not more than an amount equal to fifteen percent of the trust company's capital. This provision does not apply to a money market fund.
D. In evaluating investment limits under this Chapter, a trust company shall not be required to combine the following:
(1) The trust company's pro rata share of the securities of an issuer in the portfolio of an investment company with the trust company's pro rata share of the securities of that issuer held by another investment company in which the trust company has invested.
(2) The trust company's own direct investment in the securities of an issuer with the trust company's pro rata share of the securities of that issuer held by each investment company in which the trust company has invested under this Section.
Acts 2003, No. 573, §1, eff. June 27, 2003.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:615. Engaging in commerce prohibited

RS 6:615 - Engaging in commerce prohibited
Except as otherwise provided by this Chapter or rules adopted under this Chapter, a trust company may not invest its funds in trade or commerce by buying, selling, or otherwise dealing in goods or by owning or operating a business not part of the trust business, except as necessary to fulfill a fiduciary obligation to a client.
Acts 2003, No. 573, §1, eff. June 27, 2003.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:621. Borrowing limit

RS 6:621 - Borrowing limit
Except with the prior written approval of the commissioner, a trust company may not have outstanding liabilities exceeding an amount equal to three times its capital. However, the commissioner may impose a lower limit consistent with the safety and soundness of the trust company.
Acts 2003, No. 573, §1, eff. June 27, 2003.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:622. Pledge of assets

RS 6:622 - Pledge of assets
A trust company may not pledge or create a lien on any of its assets except to secure the repayment of money borrowed or authorized or required by this Chapter or by rules adopted under this Chapter. An act, deed, conveyance, pledge, or contract in violation of this Section is void.
Acts 2003, No. 573, §1, eff. June 27, 2003.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:623. Fiduciary responsibility

RS 6:623 - Fiduciary responsibility
The board of a trust company is responsible for the proper exercise of fiduciary powers by the trust company and each matter pertinent to the exercise of fiduciary powers, including determination of policies, investment, and disposition of property held in a fiduciary capacity, and the direction and review of the actions of each officer, employee, and committee used by the trust company in the exercise of its fiduciary powers.
Acts 2003, No. 573, §1, eff. June 27, 2003.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:624. Reports of apparent crime

RS 6:624 - Reports of apparent crime
A trust company that is the victim of a robbery, that has a shortage of corporate or fiduciary funds in excess of five thousand dollars, or that is the victim of an apparent or suspected misapplication of its corporate or fiduciary funds or property in any amount by a director, manager, managing participant, officer, or employee shall report such robbery, shortages, or apparent or suspected misapplication to the commissioner within forty-eight hours after the time it is discovered. The initial report may be oral if the report is promptly confirmed in writing. The trust company or a director, manager, managing participant, officer, employee, or agent is not subject to liability for defamation or other charge resulting from information supplied in the report.
Acts 2003, No. 573, §1, eff. June 27, 2003.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:625. Out-of-state activities

RS 6:625 - Out-of-state activities
To the extent allowed by the laws of another state, a Louisiana trust company may establish and maintain trust offices or solicit and market trust services in a state other than Louisiana by adhering to the following:
(1) To establish a trust office in another state, a Louisiana trust company shall file an application with the office of financial institutions on a form prescribed by the commissioner.
(2) To establish a trust representative office in another state, a Louisiana trust company shall provide the commissioner with notice of its intent to operate the representative office at least thirty days prior to commencing business at the out-of-state location. Upon a showing of good cause, the commissioner may lengthen or shorten the notification period.
(3) To solicit and market trust services in another state through the mail and other means of interstate commerce without maintaining a physical presence in the other state, a Louisiana trust company may do so without filing any applications or notifications with the commissioner of financial institutions.
Acts 2003, No. 573, §1, eff. June 27, 2003.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:626. Out-of-state trust companies

RS 6:626 - Out-of-state trust companies
A.(1) An out-of-state trust company may act as a fiduciary from a trust office only if both of the following conditions are met:
(a) The out-of-state trust company maintains a trust office in the state of Louisiana.
(b) In the state where the out-of-state trust company has its principal location, similar institutions chartered under Louisiana law may establish offices and engage in substantially similar activities authorized under this Chapter.
(2) Subject to the requirements of Paragraph (1) of this Subsection, an out-of-state trust company that maintains one or more trust offices in the state may at each office conduct any activity authorized to be conducted by a Louisiana trust company under this Chapter.
(3) An out-of-state trust company may establish a trust representative office in Louisiana at which the out-of-state trust company may perform trust-related business, except that the company may not enter into any trust agreements pursuant to the laws of this state.
B. An out-of-state trust company may solicit and market its fiduciary trust services in this state through the mail and other means of interstate commerce without maintaining a physical presence in this state and without filing an application or notice with the commissioner.
Acts 2003, No. 573, §1, eff. June 27, 2003; Acts 2019, No. 334, §1, eff. June 11, 2019.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:627. Interstate supervision and regulation

RS 6:627 - Interstate supervision and regulation
The commissioner may rely upon applications, notifications, and examination reports provided by the appropriate home states or federal regulator, or enter into agreements with other state regulators to supervise and regulate the trust activities of interstate trust companies.
Acts 2003, No. 573, §1, eff. June 27, 2003.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:641.1. Public policy

RS 6:641.1 - Public policy
It is the declared public policy of the state of Louisiana to encourage and to foster the development of credit unions under a dual chartering system of the state and federal governments. In order to carry out this policy, the office of financial institutions of the state of Louisiana is authorized and requested to use its resources in the promotion and development of credit unions chartered under the laws of Louisiana.
Added by Acts 1978, No. 480, §1.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:642. Amendments of act of incorporation; commissioner's approval

RS 6:642 - Amendments of act of incorporation; commissioner's approval
At a general meeting convened for that purpose, or at any annual meeting after notice mailed at least ten days previous to the date of the meeting and directed to the last known address of each member of record as of the date of issuance of notice, and after one notice properly displayed at the office of the credit union, the members may make modifications, additions or changes in the act of incorporation by a three-fourths vote of all of the members present at the meeting. All proposed amendments, however, must be approved in writing by the commissioner in advance of their submission to the members.
Amended by Acts 1954, No. 530, §1.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:643. Restriction of the use of term credit union

RS 6:643 - Restriction of the use of term credit union
A. Except for corporations formed under the provision of this Chapter, any person, partnership, firm, or corporation using any name or title containing the words "credit union" shall be fined not less than one hundred dollars or more than one thousand dollars, or be imprisoned for not more than one year, or both.
B. The provisions of Subsection A do not apply to credit unions organized under the laws of the United States and the several states and to organizations whose membership consist primarily of credit unions.
Amended by Acts 1975, No. 653, §1.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:645. Membership

RS 6:645 - Membership
A. The membership shall consist of the incorporators and such natural persons as have been duly elected to membership and have subscribed to one or more shares and have paid for the same in whole or in part with the entrance fee as required by the charter and by-laws and have complied with such other requirements as the act of incorporation may contain. Other organizations, incorporated or not, composed primarily of the same individuals who are eligible to membership in the credit union are also eligible to membership.
B. Credit unions shall be organized only within groups that have a common bond of residence within a well defined neighborhood, small community, or rural district, or occupation, or association, or any combination thereof. The minimum potential of one hundred persons shall be required in groups having a common bond of occupation, and a potential of two hundred families shall be required in other type groups. Employee groups with insufficient membership shall be eligible in a central type credit union with the approval of the commissioner. Credit union membership shall consist of the incorporators and such other persons and incorporated and unincorporated organizations, to the extent provided for in the charter and bylaws, as may be elected to membership, and as such shall each subscribe to one share of its stock and a uniform entrance fee if required by the board of directors. A person who has retired from active employment, but receives retirement compensation, may continue to retain full membership.
C. Students who qualify for a student loan under the provisions of the Louisiana Higher Education Assistance Commission Act* shall be eligible for membership in any credit union domiciled in this state solely for the purpose of obtaining a student loan under the provisions of the Louisiana Higher Education Assistance Commission Act.
D. Members of a federally chartered or state chartered credit union in liquidation in Louisiana, who are residents of Louisiana, shall be eligible for membership in a central type credit union.
Amended by Acts 1954, No. 530, §1; Acts 1970, No. 401, §2; Acts 1972, No. 160, §1; Acts 1974, No. 598, §1; Acts 1981, No. 166, §1.
*See, R.S. 17:3021 to 17:3030
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:646.1. Involuntary dissolution; distribution of assets

RS 6:646.1 - Involuntary dissolution; distribution of assets
A. All claims against the assets of an association whose deposits are insured by an agency of the federal government or other approved insurer, proved to the receiver's satisfaction or approved by the receivership court, shall be paid in the following order:
(1) Administration expenses of the liquidation.
(2) Deposit obligations, member share accounts, and share certificate accounts to the extent the account exceeds the deposit insurance coverage.
(3) Loan advances from other credit unions.
(4) Other general liabilities.
(5) Debt subordinated to the claims of depositors and general creditors.
B. No interest on any claim shall be paid until all claims within the same class have received the full principal amount of the claim.
Acts 1989 1st Ex. Sess., No. 13, §2, eff March 13, 1989; Acts 1989, No. 495, §1.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:647. Fiscal year; meetings; regulations as to voting

RS 6:647 - Fiscal year; meetings; regulations as to voting
A. The credit union fiscal year shall end at the close of business on the thirty-first day of December.
B. Special meetings of the members of the credit union may be held by order of the board of directors or of the supervisory committee, and shall be held on request of ten percent of the members.
C. At all meetings of the members of the credit union, a member shall have but one vote, irrespective of the number of shares held. The credit union bylaws may prescribe the minimum age for a member to vote or to hold office. No shareholder may vote by proxy, but a society, association, copartnership, or corporation having membership in the credit union may be represented by one person, duly authorized to represent it.
D. At any membership meeting, the members may decide on any matter of interest to the credit union that is not inconsistent with the law, the credit union charter, and bylaws.
Amended by Acts 1976, No. 319, §1; Acts 1979, No. 487, §1.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:648. Elections; oath of office

RS 6:648 - Elections; oath of office
A. At an annual meeting the members shall elect a board of directors, and, where bylaws provide, a credit committee, and a supervisory committee. No member of the board shall be a member of either of the committees. All members of the board and committees and all officers hold their offices for such terms as are provided in the charter or bylaws.
B. Immediately following their election, and in every case before assuming the duties of their office the directors shall take an oath of office to discharge their duties as directors properly and conscientiously, which oath shall be entered into the minutes of the next regular or special meeting of the board of directors and shall be retained in the records of the credit union for examination by the commissioner. These oaths shall be in writing and signed, and shall be renewed as to each director upon the occasion of each reelection to the board. Forms of the oath shall be furnished by the commissioner. The commissioner may suspend any director who fails to comply with this requirement and no suspended director may be reinstated, except for good cause shown after taking the oath.
C.(1) No person shall be eligible to serve as a director or committee member of a credit union unless he or she is a shareholder, owning, in his or her own right, at least one fully paid share the par value of which shall be stated in the credit union bylaws.
(2) In the case of a corporate credit union, no designated representative of a credit union, serving as a director or committee member of a corporate credit union, shall be eligible to serve as a director or committee member of a corporate credit union, unless such credit union owns at least one fully paid voting capital share, as defined in the corporate credit union bylaws.
D. The bylaws of the credit union shall clearly define the procedure for election. They shall set forth the number of directors to be elected.
Amended by Acts 1954, No. 530, §1; Acts 1985, No. 65, §1; Acts 1993, No. 276, §1, eff. Oct. 1, 1993; Acts 1995, No. 293, §1.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:649.1. Relation and liability of directors and officers to a credit union and its members

RS 6:649.1 - Relation and liability of directors and officers to a credit union and its members
A. Credit union officers and directors shall be deemed to stand in a fiduciary relationship to their credit union and its members and shall discharge the duties of their respective positions in good faith and with the diligence, care, judgment, and skill as provided for in Subsection B of this Section. Nothing herein contained shall derogate from any indemnification otherwise provided for such officers and directors by law. Indemnification of such officers and directors may be provided for in the credit union's articles or bylaws in the manner and to the extent allowed officers and directors of corporations under the Louisiana Business Corporation Law, R.S. 12:1 et seq.
B. A director or officer of a credit union shall not be held personally liable to the corporation, the shareholders, or members thereof for monetary damages unless the director or officer acted in a grossly negligent manner as defined in R.S. 6:2(8) or engaged in conduct which demonstrates a greater disregard of the duty of care than gross negligence, including intentional tortious conduct or intentional breach of his fiduciary duty.
C. A director of a credit union shall, in the performance of his duties, be fully protected in relying in good faith upon the records of the credit union, and upon such information, opinions, reports, or statements presented to him, the credit union, the board of directors, or any committee thereof by any of the credit union's officers or employees, or by any committee of the board of directors, or by any counsel, appraiser, engineer, or independent or certified public accountant selected with reasonable care by the board of directors or any committee thereof or any officer having the authority to make such selection, or by any other person as to matters the director reasonably believes are within such other person's professional or expert competence and which person is selected with reasonable care by the board of directors or any committee thereof or any officer having the authority to make such selection.
D. Notwithstanding any other law to the contrary, the provisions of this Section shall be the sole and exclusive law governing the relation and liability of directors and officers to their credit union, or members thereof, or to any other person or entity, except that the provisions of the Louisiana Business Corporation Law, R.S. 12:1 et seq., regarding indemnification of directors and officers shall be applicable to directors and officers of credit unions.
E. Any person who unsuccessfully attempts to impose a higher standard of responsibility or liability than that provided by this Section may be liable for attorney fees incurred in the defense of such attempt and for damages.
Acts 1993, No. 517, §1, eff. June 10, 1993; Acts 1999, No. 703, §1, eff. July 1, 1999.
{{NOTE: SEE ACTS 1993, NO. 517, §2.}}
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:649.2. Actions against directors and officers of credit unions

RS 6:649.2 - Actions against directors and officers of credit unions
A. No action for damages against any director or officer of a credit union for breach of contract with the credit union in the capacity of director or officer, or for breach of his duty as a director or officer, including, without limitation, action for gross negligence, but excluding any action covered by the provisions of Subsection B of this Section, shall be brought unless filed in a court of competent jurisdiction and proper venue within one year from the date of the alleged act, omission, or neglect, or within one year from the date that the alleged act, omission, or neglect is discovered or should have been discovered. As to an action filed within one year from the date of discovery, such an action shall be filed no later than three years from the date of the alleged act, omission, or neglect.
B. No action for damages against any director or officer of a credit union for intentional tortious misconduct, or for an intentional breach of the director's or officer's duty of loyalty, or for acts or omissions in bad faith, or involving fraud, or a knowing and intentional violation of law, shall be brought unless filed in a court of competent jurisdiction and proper venue within two years from the date of the alleged act or omission, or within two years from the date the alleged act or omission is discovered or should have been discovered. As to an action filed within two years from the date of discovery, such an action shall be filed no later than four years from the date of the alleged act, omission, or neglect.
C. The three-year period provided in Subsection A and the four-year period provided in Subsection B shall be deemed preemptive periods and shall not be subject to renunciation, interruption, or suspension except by timely suit filed in a court of competent jurisdiction and proper venue.
Acts 1993, No. 517, §1, eff. June 10, 1993.
{{NOTE: SEE ACTS 1993, NO. 517, §2.}}
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:650. Credit committee

RS 6:650 - Credit committee
A.(1) If the bylaws provide for a credit committee, then pursuant to the provisions of the bylaws, the board of directors may appoint, or the members may elect, a credit committee. The credit committee shall hold such meetings as the business of the credit union may require, not less frequently than once a month, to consider applications for loans or lines of credit. Reasonable notice of such meetings shall be given to all members of the committee. Except for those loans or lines of credit required to be approved by the board of directors, approval of an application shall be by majority of the committee who are present at the meeting at which it is considered, provided that a majority of the full committee is present. The credit committee may appoint and delegate to loan officers the authority to approve applications.
(2) If the bylaws provide for a credit committee, all applications not approved by the loan officer shall be reviewed by the credit committee, and the approval of a majority of the members who are present at the meeting when such review is undertaken shall be required to reverse the loan officer's decisions, provided a majority of the full committee is present. If there is not a credit committee, a member shall have the right, upon written request, of review by the board of directors of a loan application which has been denied. No individual shall have authority to disburse funds of the credit union with respect to any loan or line of credit for which the application has been approved by him in his capacity as a loan officer.
B. No loan shall be made unless it has received the unanimous approval of the members of the committee present when the loan was considered, except as provided elsewhere in this Chapter, which number shall constitute at least a majority of the committee. An applicant for a loan may appeal to the directors from the decision of the credit committee if it is so provided in the charter or bylaws. The credit committee shall meet as often as required, but due notice shall be given each member.
Amended by Acts 1954, No. 530, §1; Acts 1956, No. 311, §1; Acts 1981, No. 166, §1; Acts 1983, No. 351, §1.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:650.2. Educational committee

RS 6:650.2 - Educational committee
The credit union may establish, in a manner provided for in the bylaws, an educational committee. The committee shall plan, and, with approval of the board of directors, carry out programs to inform members and potential members of the objectives, procedures and services of the credit union, and to encourage maximum participation in all activities of the credit union.
Added by Acts 1968, No. 180, §1.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:651. Supervisory committee; examination and report

RS 6:651 - Supervisory committee; examination and report
A.(1) Pursuant to the provisions of the bylaws, the board of directors may appoint, or the members may elect, a supervisory committee. The supervisory committee shall at frequent intervals inspect the securities, cash, and accounts of the credit union and supervise the acts of the board of directors, credit committee, and officers, any or all of whom the supervisory committee may suspend at any time by unanimous vote. Within seven days after such a suspension, the supervisory committee shall cause notice to be given to the members and the commissioner of a special meeting to take action on the suspension, the call for the meeting to indicate clearly its purpose.
(2) By a majority vote the committee may call a meeting of the shareholders to consider any violation of this Chapter or of the charter or bylaws, or any practice of the credit union which is unsafe and unauthorized in the opinion of the committee.
B. Supervisory committee vacancies shall be filled in the manner provided for in the bylaws.
C. The supervisory committee shall annually examine the financial condition and internal control structure of the credit union in accordance with applicable federal regulations or rules promulgated by the commissioner.
Amended by Acts 1954, No. 530, §1; Acts 1956, No. 311, §1; Acts 1984, No. 581, §1; Acts 1989, No. 495, §3; Acts 1991, No. 162, §1; Acts 1991, No. 655, §1; Acts 1999, No. 703, §1, eff. July 1, 1999; Acts 2001, No. 887, §1, eff. June 26, 2001.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:652. Capital

RS 6:652 - Capital
The capital of a credit union shall consist of the payments that have been made to it by the several members thereof on shares. A credit union shall have a privilege on the shares of any member and on the dividends payable thereon for and to the extent of any loan made to him and of any dues and fines payable by him. A credit union may, upon the resignation or expulsion of a member, cancel his shares and apply the withdrawal value of the shares towards the liquidation of his indebtedness.
A credit union may charge an entrance fee as may be provided in the charter. Fully paid up shares of a credit union may be transferred to any person upon election to membership, upon such terms as the charter may provide and upon the payment of a transfer fee which shall not exceed twenty-five cents. No commission or compensation shall be paid for securing members or for the sale of shares.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:652.1. Types of capital

RS 6:652.1 - Types of capital
A credit union may issue any type or kind of share or savings account representing savings of members of the credit union as may be authorized by the board of directors of the credit union, and may agree to pay an additional or different rate of dividend or interest on any share or savings account based upon its classification with respect to the character, amount, duration, or regularity of the transactions with respect to such share or savings account, provided the credit union pays the same dividend or interest rate on all shares or savings accounts in the same classification.
Added by Acts 1977, No. 165, §2. Amended by Acts 1981, No. 166, §1.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:653.1. Trust deposits; death of depositor; payment

RS 6:653.1 - Trust deposits; death of depositor; payment
A. Upon the death of a member who has deposited a sum in any federal or state credit union account evidencing an intention that upon the death of the member, the funds shall belong to the named beneficiary or beneficiaries of the member, the federal or state credit union may pay the share account, together with the dividends or accruing interest, to the named beneficiaries for whom the deposit was made, and the federal or state credit union may rely conclusively thereon. Upon receiving a death certificate, the credit union may disburse funds to the named beneficiaries. Such beneficiaries shall be specifically named in the share account records of the federal or state credit union.
B. Repealed by Acts 2016, No. 64, §2.
C. Repealed by Acts 2009, No. 499, §2.
D.(1) When a share account described in Subsection A of this Section is established by more than one member, the respective interests of each member shall be deemed equal to that of each other member, unless otherwise stated in the federal or state credit union's share account records.
(2) When a share account described in Subsection A of this Section is established for more than one beneficiary, the respective interests of each shall be deemed equal to that of each other beneficiary, unless otherwise stated in the federal or state credit union share account records.
E. No federal or state credit union paying a beneficiary in accordance with this Section shall be liable to the estate or any heir of the decedent nor shall the share account holder be liable for any estate, inheritance, or succession taxes which may be due the state, and delivery of the funds shall constitute a full and complete discharge of the federal or state credit union for the payment or delivery so made and shall relieve the federal or state credit union from all adverse claims thereto by a person claiming as a surviving or former spouse or a successor to such a spouse.
F. The provisions of this Section shall apply notwithstanding the fact the decedent designates a beneficiary by last will and testament.
Acts 1991, No. 535, §1; Acts 2001, No. 887, §1, eff. June 26, 2001; Acts 2009, No. 499, §§1 and 2; Acts 2016, No. 64, §§1, 2.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:653.3. Ownership of shares

RS 6:653.3 - Ownership of shares
A credit union may conclusively rely on any membership application, agreement, or signature card used to establish a share account as establishing ownership of any shares and other credits deposited therein, and may consider and treat any funds on share in such an account as belonging to and the sole and exclusive property of the member or members named on the account membership application, agreement, or signature card, unless otherwise notified or directed by such member or members.
Acts 1995, No. 293, §1.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:654. Rates of interest

RS 6:654 - Rates of interest
A. Notwithstanding any other provision of the law to the contrary, a credit union may lend to its members at such maximum fixed rates or maximum variable rates of interest, as provided for in the bylaws of the credit union, which have been approved by the commissioner of financial institutions. An endorser, guarantor, or co-maker shall be subject to the same interest charge as a member of the credit union.
B. Notwithstanding any other provision of the law to the contrary, with respect to a loan to a member pursuant to an open-end credit, revolving credit, or line of credit loan account, a credit union may contract to receive and collect a finance charge, which may be such maximum fixed rates or maximum variable rates of interest in any amount, as provided for in the credit union bylaws, which have been approved by the commissioner of financial institutions. The finance charge may be added to the loan balance on the monthly due date or monthly billing date or the proportionate part due may be added when a new advance is made.
C. Notwithstanding any other provision of the law to the contrary, a credit union may provide in the bylaws for fees and costs incidental to the making of loans and for late charges, which have been approved by the commissioner of financial institutions.
Amended by Acts 1954, No. 530, §1; Acts 1972, No. 160, §1; Acts 1975, No. 653, §3; Acts 1979, No. 487, §1; Acts 1980, No. 210, §1; Acts 1982, No. 436, §1.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:655. Power to borrow

RS 6:655 - Power to borrow
A. A credit union may borrow from any source, but the total of such borrowing at no time shall exceed fifty percent of its paid in and unimpaired capital and surplus.
B. The limitation in Subsection A of this Section shall not apply to a central or corporate credit union. However, the borrowing limitations of a central or corporate credit union shall be provided for in its bylaws as approved by the commissioner.
Amended by Acts 1954, No. 530, §1; Acts 1983, No. 351, §1.
2023 Louisiana Laws › Revised Statutes › Title 6 - Banks and Banking › §6:658. Dividends

RS 6:658 - Dividends
A. At such intervals as the board of directors may authorize and after provision for the required reserve and subject to applicable federal regulations, the board of directors may declare a dividend to be paid, at different rates on different types of shares, and at different rates and maturity dates in the case of share certificates, from the remaining net earnings. Dividend credit may be accrued on various types of shares and share certificates as authorized by the board of directors.
B. Provided no credit union shall declare or pay any dividends on its shares except from current net earnings, and undivided profits. Provided, further, that in the event of delinquency in loans there shall be no dividends paid unless the reserve fund shall be equal to or in excess of the sum of 10 percent of the unpaid balance of loans delinquent more than two months and less than six months, plus twenty-five percent of the unpaid balances of loans delinquent from six months to less than twelve months, plus fifty percent of the unpaid balances of loans delinquent from twelve months to less than eighteen months, plus one hundred percent of the unpaid balances of loans delinquent eighteen months or more; provided, further, that in the event the legal reserve fund does not equal the amount required as hereinabove set forth, then and in that event the reserve fund shall be supplemented by a special reserve for delinquent loans in an amount which will make the reserve fund and the special reserve equal to the sum required in accordance with the schedule hereinabove set forth.
Amended by Acts 1954, No. 530, §1; Acts 1970, No. 401, §6; Acts 1975, No. 653, §3; Acts 1977, No. 165, §1.