SUBCHAPTER 6C ‑ CREDIT UNIONS

SECTION .0100 ‑ GENERAL INFORMATION

04 NCAC 06C .0101          DEFINITIONS

When used in this Chapter, the following words and phrases shall have the following meaning, except to the extent that any such word or phrase is specifically qualified by its context:

(1)           "Administrator" shall mean the Administrator of State‑Chartered Credit Unions.

(2)           "Capital" consists of shares, undivided earnings, and reserves.

(3)           "Commission" shall consist of seven members and they are vested with full power and authority to review, approve or modify any action taken by the Administrator of Credit Unions in the exercise of all powers, duties and functions vested by law in or exercised by the Administrator of Credit Unions under the Credit Union Laws of North Carolina.

(4)           "Credit union" is a cooperative nonprofit corporation organized for the purpose of promoting thrift among its members by affording them an opportunity for accumulating their savings; and to create for them a source of credit for loans for provident and productive purposes; and may undertake such other activities relating to the purpose of the corporation as its bylaws may provide; such credit union being chartered under the General Statutes of North Carolina.

(5)           "Deposits" are a preferred savings account on which the Credit Union is obligated to pay a guaranteed interest rate on a continuing basis in such amounts and terms as the Board of directors approve.

(6)           "Dividend" is an operating expense of a credit union which is declared payable on share accounts from time to time by the Board of directors.

(7)           "EDP" shall mean electronic data processing.

(8)           "Interest on deposit accounts" is an expense paid by the Credit Union for obtaining funds in a deposit account.

(9)           "Interest on loans" is an amount charged to a member for borrowing funds from a credit union at a specified rate as declared by the Board of directors, not to exceed the maximum legal rate.

(10)         "Interest refund" is a percentage of the interest collected on loans which is refunded to those members who borrowed during a specific period pursuant to action of the Board of directors.

(11)         "Members" shall mean persons or organizations who have been accepted for membership by either the Board, membership officer, or an executive committee, after having met qualifications of being within the field of membership.

(12)         "Membership" in a credit union is limited to those as stipulated in the bylaws of such credit union.

(13)         "Membership fee" is a fee that may be charged to applicants for membership as an entrance fee or as an annual membership fee as determined by the Board of directors or as the bylaws may provide.

(14)         "Reserve fund" is the portion of income to be entered on the books of the corporation to offset uncollectible loans in accordance with Section 54‑109.86 of the General Statutes.

(15)         "Shares" is the primary capital owned by the members and is comprised of the savings of the members.  The par value shall be as the bylaws provide.

(16)         "Unimpaired capital" shall consist of the shares, undivided surplus and reserves less any known or probable losses.

(17)         "Funds" means cash on hand, cash in the bank and investments.

(18)         "Book value of loans" is the dollar amount of loans the Credit Union has on its books.

(19)         Types of investment transactions are defined as follows:

(a)           "Standby commitments" means an agreement to purchase or sell a security at a future date, whereby the buyer is required to accept delivery of the security at the option of the seller.

(b)           "Cash forward agreement" means an agreement to purchase or sell a security at a future date more than five days after the agreement is made and which requires mandatory delivery and acceptance.

(c)           "Reverse repurchase agreement" means an agreement whereby a credit union enters into an understanding to sell securities to a purchaser and to repurchase the same securities from that purchaser at a future date, irrespective of the amount of consideration paid by the Credit Union or the purchaser.

(d)           "Repurchase agreement" means an agreement whereby a credit union enters into an agreement to buy securities from a vendor and to resell securities at a future date.  Repurchase agreements may be of two types:

(i)            "Investment‑type repurchase agreement" means a repurchase which contains the essential elements of a sale of security as specified in Rule .1202(5) of this Subchapter.

(ii)           "Loan‑type repurchase agreement" means any repurchase agreement which does not qualify as an investment‑type repurchase agreement.

(e)           "Future" means a standardized contract for the future delivery of commodities, including certain government securities, sold on designated commodities exchange.

(20)         "Corporate Credit Union" is a credit union with an institutional field of membership.

(21)         "Credit Union Service Organization" or "CUSO" is an organization formed and operated by credit union(s), or associations or organizations of credit unions, to provide revenue generating services of the highest quality to credit union members, credit unions and others which are needed or wanted and can be provided efficiently and economically with a satisfactory overall rate of return on investment.

(22)         "Branch Office" is a facility which a credit union maintains and staffs at a location other than its main office to furnish credit union services to its members.

History Note:        Authority G.S. 54‑109.12;

Eff. February 1, 1976;

Readopted Eff. April 4, 1978;

Amended Eff. January 1, 1992; October 1, 1983; April 1, 1979.