Every credit union shall have a credit committee of at least three persons, each of whom shall be a member of the credit union, or in the alternative, a credit manager, to have general supervision of all obligations of members. The bylaws of the credit union shall provide that either: (1) the members of the credit committee shall be elected by the members of the credit union at their annual meeting, or (2) they shall be appointed by the board of directors, or (3) that the board of directors may establish the position of credit manager in lieu of a credit committee. The bylaws of the credit union shall provide for the terms of office of the credit
committee, where the credit committee has been provided for in the bylaws, which shall not exceed three years, and which may be staggered.
Management and OperationsCredit Committee and Loan Officers
Section § 14600
Every credit union must have either a credit committee with at least three members or a credit manager to oversee member obligations. The credit union's bylaws will decide whether the credit committee is elected by members at the annual meeting or appointed by the board of directors. Alternatively, the board might choose to establish a credit manager instead of a committee. If there is a credit committee, its members can serve for up to three years, with the option for staggered terms.
credit union credit committee credit manager
Section § 14601
This law states that if you're part of the credit committee or are a credit manager or loan officer, you can't also be on the supervisory committee.
No member of the credit committee or the credit manager or any loan officer shall serve as a member of the supervisory committee.
credit committee supervisory committee loan officer
Section § 14602
This section of the law outlines how credit unions in California must manage loan approvals and other obligations with their members. It specifies that most obligations need written approval from the majority of the credit committee, credit manager, or a designated loan officer. However, there are exceptions for obligations made through approved credit scoring or preapproval programs. It also clarifies that the credit committee or a credit manager can appoint loan officers, but these officers cannot approve membership applications or handle loan term extensions unless regulations allow it. Finally, a record of each obligation must be maintained and provided to the credit committee or credit manager within 30 days of any decision made by loan officers.
(a)Copy CA Financial Code § 14602(a)
(1)Copy CA Financial Code § 14602(a)(1) No credit union shall create any obligation with a credit union member, without the written approval of a majority of all the members of the credit committee, the credit manager, or a loan officer appointed as provided in this section.
(2)CA Financial Code § 14602(a)(2) Paragraph (1) does not apply to the creation of an obligation in accordance with a credit scoring program, preapproval credit program, or similar program, if the program was adopted by the board of directors,
credit committee, or credit manager and complies with a written lending policy on programs of that type established by the board of directors in accordance with Section 15100.
(b)CA Financial Code § 14602(b) The credit committee or the credit manager may, with the approval of the board of directors, appoint one or more loan officers who shall be authorized to approve obligations with credit union members.
(c)CA Financial Code § 14602(c) Neither the credit committee, a credit manager, or any loan officer shall have the power to approve membership applications.
(d)CA Financial Code § 14602(d) No loan officers shall be permitted to approve any extension agreement of any obligation or the refinancing of any obligation except as prescribed in regulations promulgated by the commissioner.
(e)CA Financial Code § 14602(e) The credit committee, or in the alternative, the
credit manager shall be provided with a record of each obligation approved or not approved by any loan officer, within 30 days of the approval or disapproval.
credit union obligations loan approval process credit committee
Section § 14603
This section explains how credit approvals work within a credit union. The credit committee, manager, or loan officer can approve a member's credit in advance. Once approved, the member can get loans up to a certain limit set by the board. As long as this total doesn't go over the limit, no further permissions are needed. However, these credit approvals must be reviewed regularly and will expire if a member can't qualify for a loan or hasn't made payments for over 90 days.
The credit committee, the credit manager, or a loan officer may approve in advance, upon their own motion or upon the application of any member, the extension of credit to any member and loans may be granted to such member within the limit of such extension of credit authorized by the board of directors pursuant to Section 15100. Where an extension of credit has been approved, applications for any extension of credit need not be approved by the credit committee, the credit manager, or loan officer as long as the aggregate amount of such obligations does not exceed the limit of such extension of credit authorized by the board of directors pursuant to
Section 15100. The credit committee, the credit manager, or loan officer shall review, from time to time, all extensions of credit approved by them and any extension of credit approved for any member shall expire if such member becomes ineligible for a loan or becomes more than 90 days delinquent in his obligations to the credit union.
credit committee credit manager loan officer
Section § 14604
If a credit union turns down a member's loan application or any other financial request, the member has the right to appeal this decision to the board of directors.
A credit union member whose written application to enter into any obligation is denied, may appeal from the denial of the credit committee, the credit manager, or loan officer to the board of directors.
credit union loan application denial appeal process
Section § 14605
This law states that a credit manager is not allowed to either directly or indirectly oversee the distribution of loan money. Additionally, a credit manager cannot approve or provide loans to other credit unions.
A credit manager shall not disburse or have the authority to authorize any person to disburse the proceeds of any loan. A credit manager shall not authorize or make loans to other credit unions.
credit manager disburse loan proceeds authorize disbursement
