§ 1102. Conversion from Federal credit union.

(a) General rule.--A Federal credit union may be converted into a credit union subject to the provisions of this title by:

(1) Complying with all Federal requirements requisite to enabling it to convert to a credit union or to cease being a Federal credit union.

(2) Filing with the department proof of compliance with such Federal requirements in form satisfactory to the department.

(3) Filing with the department, together with such reasonable fees as shall be established by the department, including an application fee and fees for such examination and such investigation as it may deem necessary, articles of conversion which shall set forth:

(i) The proposed name of the converted credit union.

(ii) The exact location of the principal place of business of the credit union into which the Federal credit union plans to become converted.

(iii) The number, names and addresses of the persons to be the first directors of the converted credit union.

(iv) All other statements required by this title to be set forth in original articles of incorporation in the case of the formation of a credit union in so far as such information is applicable to a Federal credit union proposing to become converted into a credit union.

(b) Department review.--Immediately upon the receipt of the articles of conversion, the department shall conduct such examination as may be deemed necessary to ascertain from the best sources of information at its command:

(1) Whether the name of the proposed credit union conforms with the requirements of law for the name of a credit union and whether it is the same as one already adopted or reserved by another person or is so similar thereto that it is likely to mislead the public.

(2) Whether the conversion is made for legitimate purposes.

(3) Whether the interests of members and creditors are adequately protected.

(4) Whether the proposed credit union meets all of the requirements of this title and violates none of its prohibitions applicable to a credit union incorporated under this title.

(5) Whether the Federal credit union has complied with the requirements of the laws of the United States as they relate to the conversion of a Federal credit union into a credit union. Within 60 days after receipt of the articles of conversion, the department shall, upon the basis of the facts disclosed by its investigation, either approve or disapprove such articles.

(c) Approval action.--If the department approves the articles, it shall register its approval thereon and shall forward them to the Department of State for filing. Immediately upon receipt of the approved articles of conversion, the Department of State shall file the articles. The conversion shall become effective immediately upon such filing and the converted credit union shall have all the rights, privileges, immunities and franchises of the Federal credit union, except that it shall not thereafter acquire authority to engage in any business or exercise any right which is forbidden to a credit union when originally incorporated under this title.

(d) Disapproval action.--If the department disapproves the articles of conversion, it shall return them to the Federal credit union desiring to become converted into a credit union stating in detail its reasons for so doing.

(e) Cross reference.--See 15 Pa.C.S. § 134 (relating to docketing statement). (Dec. 9, 2002, P.L.1572, No.207, eff. 60 days)

2002 Amendment. Act 207 amended subsecs. (a), (b) and (d).