Removing Barriers Blog

California Credit Union Act Modernization Signed into Law
Posted September 15, 2016 by CUNA Advocacy

A bill modernizing California’s state credit union act, A 2274, passed its final hurdle in when it was signed by the governor yesterday. The bill is the product of an extensive push by the California Credit Union League, which worked closely with lawmakers to ensure the bill’s passage.

The legislation strengthens the state charter by:

  • Allowing member business loans to exceed a member's deposits
  • Eliminating board approval of membership applications
  • Allowing for an audit committee in lieu of a supervisory committee
  • Allowing non-members to act as the co-borrower, surety, or guarantor of a loan made to a member
  • Redefining which credit union officials' loans are subject to certain limitations and are required to be reviewed by the board
  • Allowing credit unions to decide whether their boards need to meet on a monthly basis, or if they should opt to meet less often based on the needs of the credit union
  • Removing unnecessary loan documentation requirements

The provisions are effective January 1, 2017.