SECTION 1. Chapter 294 of the acts of 1961 is hereby amended by striking out section 1, as appearing in section 1 of chapter 278 of the acts of 1982, and inserting in place thereof the following section:

Section 1. There is hereby constituted a corporation under the name of Massachusetts Credit Union Share Insurance Corporation, hereinafter referred to as the corporation, for the purpose of creating and maintaining a fund for the insurance of shares and deposits of members of the Central Credit Union Fund, Inc. and of credit unions which are established under the laws of (1) the commonwealth, (2) the states of Maine, New Hampshire, Vermont, New York, Connecticut or Rhode Island, or (3) the United States, provided a credit union so established under the laws of the United States has its principal place of business in the commonwealth, or the states of Maine, New Hampshire, Vermont, New York, Connecticut or Rhode Island.

In considering any application for membership, the commissioner may require the collection of information relative to the potential risk to and adequacy of the share insurance fund presented by any application for membership, including: 

(1) Information submitted in accordance with the provisions of section 6D, including examination reports and information as set forth in paragraph (e) of said section and a valid agreement to be subject to supervision and examination by the commissioner as set forth in paragraph (f) thereof. 

SECTION 2. Section 1A of chapter 294 of the Acts of 1961, as appearing in section 4 of chapter 115 of the act of 1996, is hereby amended by striking out the definition of “Excess Member”, inserted by section 1 of chapter 115 of the acts of 1996, and inserting in place thereof the following definition:

“Excess member”, an inactive member, a federally chartered credit union, or a state chartered credit union whose excess shares and deposits, as hereinafter defined, shall become insured by the corporation pursuant to this chapter.

SECTION 3. Section 1A of chapter 294 of the acts of 1961 is hereby further amended by striking out the definition of “Federally chartered credit union”, inserted by said section 1 of said chapter 115, and inserting in place thereof the following definition:

“Federally chartered credit union”, a credit union chartered under the laws of the United States whose main office is located in the commonwealth, or the states of Maine, New Hampshire, Vermont, New York, Connecticut or Rhode Island.

SECTION 4. Said section 1A of said chapter 294 is hereby further amended by striking out, the definition of “State chartered credit union”, inserted by section 2 of said chapter 115, and inserting in place thereof the following definition:

“State chartered credit union”, a credit union chartered under the laws of the commonwealth, or the states of Maine, New Hampshire, Vermont, New York, Connecticut or Rhode Island.

SECTION 5. The first sentence of the first paragraph of section 6D of said chapter 294, as appearing in section 4 of said chapter 115, is hereby amended by striking out the words “located within the commonwealth”.

SECTION 6. Said section 6D of said chapter 294, as so appearing, is hereby amended by striking out paragraph (b) and inserting in place thereof the following paragraph:

(b) An excess member may have its excess shares and deposits insured only to the same extent as is permitted for an excess member which is a credit union chartered under the laws of the commonwealth subject to the maximum share and deposit limitations applicable to Massachusetts state chartered credit unions under section 30 of chapter 171 of the General Laws.

SECTION 7. Said section 6D of said chapter 294, as so appearing, is hereby further amended by striking out paragraphs (e) to (h), inclusive, and inserting in place thereof the following 4 paragraphs:

(e) Unless prohibited by applicable law or regulations, an excess member shall, in addition to paragraph (d), be required and shall agree, to provide to the corporation copies of examination reports and other reports and information regarding such credit union made by and for any appropriate banking regulatory authority.

(f) An excess member shall be subject, and shall agree, to supervision and examination by the commissioner and shall be subject to section 2 of chapter 167 of the General Laws. The commissioner, in his or her sole discretion, periodically may examine the affairs of an excess member to evaluate the level of risk of loss such excess member’s financial condition may pose to the corporation. The costs of such examination shall be borne by such credit union and shall be determined annually by the secretary of administration and finance under section 3B of chapter 7 of the General Laws. Upon examination, the commissioner may take such directions, recommendations and orders to an excess member as he or she deems expedient to the same extent as provided by section 3 of said chapter 167. Nothing contained herein shall limit an excess member which is a federally chartered credit union from the exercise of any powers authorized for a federally chartered credit union pursuant to and in conformance with the Federal Credit Union Act, or applicable rules and regulations promulgated thereunder, or pursuant to other applicable federal laws and regulations, or for a State Chartered Credit Union under the laws or regulations of its chartering jurisdiction.

(g) An excess member shall obtain the approval of the corporation and the commissioner prior to its merger or consolidation with, or the purchase of the assets and the assumption of the share and deposit liabilities of a banking institution as defined by section 1 of chapter 167A of the General Laws or a credit union chartered by the commonwealth, the United States or another state. Failure to obtain such approvals shall result in an automatic termination of excess insurance under section 6B.

(h) An excess member shall obtain the approval of the corporation and the commissioner prior to its establishment of a branch office in any other state other than the commonwealth. Failure to obtain such approvals shall result in an automatic termination of excess insurance under said section 6B.

(2) The existence of satisfactory agreements with the primary insurer and other regulators regarding information sharing, confidentiality, and supervision coordination, and related matters;

(3) The existence of satisfactory agreements with other relevant entities; and

(4) Any additional information the commissioner requires upon which to base a determination regarding potential risk to the share insurance fund that an applicant may present and examination by the commissioner as set forth in paragraph (f). 

SECTION 8. Section 5 of chapter 294 of the acts of 1961 is hereby amended by striking out the second paragraph and inserting in place hereby the following paragraph:

The board of directors shall meet at least quarterly. A majority of the directors shall constitute a quorum.

SECTION 9. Section 9 of chapter 294 of the acts of 1961 is hereby amended by striking out the first sentence of said section and inserting in place thereof the following:

The corporation may by a vote of the board of directors borrow money and pledge its assets as security therefor from members and others.

SECTION 10. Section 9 of chapter 294 of the acts of 1961 is hereby further amended by inserting the following paragraph after the first paragraph thereof:

The corporation shall be deemed to be an organization member as defined in Section 1 of chapter 171 of the General Laws of its member credit unions. Any member credit union is authorized to lend money to the corporation as an organization member.

SECTION 11. Clause (iii) of the first paragraph of section 16 of chapter 294 of the acts of 1961 as appearing in chapter 253 of the acts of 2014, is hereby amended by striking out the word “and” the last time it appears.

SECTION 12. Clause (iv) of said first paragraph of said section 16 of said chapter 294, as so appearing, is hereby amended by striking out the words “single A.” and inserting in place thereof the following words:- single A; and

SECTION 13. Said first paragraph of said section 16 of said chapter 294, as so appearing, is hereby amended by adding the following clause:

(v) Upon a 2/3 vote of its board of directors and having established that such activity will not adversely affect its safety and soundness and having adequate policies and procedures to ensure such investments governing the performance of the corporation and its employees, to minimize any credit, market, liquidity, operations, legal and reputation risks to the corporation, the corporation may apply to the commissioner to make investments as follows:

(1) In investments not specifically enumerated in this section 12 of Chapter 294 of the Acts of 1961. The corporation may invest up to 15 per cent of its assets in these investments at the time of purchase with the investment in any 1 issuer not exceeding 5 per cent of the corporation’s total assets at the time of purchase.

(2) The corporation may authorize investment advisers registered under the Investment Advisers Act of 1940 to acquire or dispose of investments for the corporation.

Any such approval granted by the commissioner shall be subject to such conditions and limitations as the commissioner may impose. The corporation may apply to invest up to 15 per cent of its assets under the authority granted in this paragraph. The percentage of such assets authorized shall be determined by the commissioner. The commissioner may increase, modify, curtail or rescind or otherwise limit the corporation's authority to make such investments.

SECTION 14.  The first paragraph of section 4 of chapter 1671 of the General Laws, as appearing in the 2018 Official Edition, is hereby amended by inserting after the first sentence the following sentence:-

Any 1 or more mutual banks or subsidiary banking institutions and any 1 or more credit unions may merge or consolidate into a single credit union upon terms approved by a vote of at least 2/3 of the board of each mutual bank and the board of directors of each credit union, and shall have been approved in writing by the commissioner.

SECTION 15.  Said chapter 167I of the General Laws, as appearing in the 2018 Official Edition, is hereby further amended by inserting after section 12 the following section:-

Section 12 1/2.  Upon the approval of the Commissioner and subject to Section 80A of Chapter 171 and such conditions as may be imposed by the commissioner, a mutual bank or a stock bank wholly owned by a mutual holding company organized under Chapter 167H, may be converted into a credit union chartered pursuant to chapter 171, and upon such conversion, shall not be subject to the requirements of the General Laws with respect to the organization and commencement of business of such a credit union. The depositors of any mutual bank shall upon the effectiveness of such conversion become members of the credit union.  A bank so converted into a credit union shall have 2 years after such transaction is approved or for such longer period as may be approved by the commissioner to dispose of any asset or investment that is not permissible for a credit union.

SECTION 16.  Section 57 of chapter 171 of the General Laws, as so appearing, is hereby amended by striking out the fourth paragraph.

SECTION 17.  Section 67 of said chapter 171, as so appearing, is hereby amended by adding after clause (v) the following 4 clauses:-

(w) in asset-backed securities in an aggregate amount not to exceed 10% of its assets;

(x) in the shares, stocks, or obligations of any organization organized and operated for the purpose of providing services which are closely related to banking as determined by the commissioner in an aggregate amount not to exceed 10% of the assets of a credit union provided, however, that such authority does not include the power to acquire control directly or indirectly, another financial institution, nor invest in shares, stocks or obligations of an insurance company, trade association, liquidity facility or any other similar organization, corporation, or association not otherwise permitted by chapter 171 of the General Laws;

(y) to participate in the activities of the Massachusetts Capital Growth Corporation created under chapter 40W by making capital available to said corporation by making an investment or deposit in or grant to said corporation, an affiliate or subsidiary of said corporation or any fund managed by said corporation in an aggregate amount not to exceed 10% of its assets; and

(z) a credit union may or in participation with a federal credit union or foreign credit union, as defined in section 1 of chapter 171, invest in, establish, operate or subscribe for services from another federal credit union, out-of-state credit union or any other business entity for the purpose of obtaining for or furnishing to the credit union technology, trust services, financial planning, compliance, internal audits, human resource or other operation functions, management staff or other banking services.

SECTION 18.  Said chapter 171 is hereby further amended by striking out section 78A, as so appearing, and inserting in place thereof the following section:-

Section 78 A. Any 1 or more credit unions, as defined in section 1 of chapter 171, may merge or consolidate with 1 or more savings banks, as defined in section 1 of chapter 168, or 1 or more co-operative banks, as defined in section 1 of chapter 170, or 1 or more subsidiary banking institutions, as defined in section 1 of chapter 167H and section 4 of chapter 1671, with either as the surviving corporation.

SECTION 19.  Said chapter 171 is hereby further amended by striking out section 80A and inserting in place thereof the following section:-

Section 80A. (a)  A credit union subject to this section may convert into a mutual savings bank governed by chapter 168, a mutual co-operative bank governed by chapter 170, a mutual federal savings bank or a mutual federal savings and loan association which exist under authority of the United States. A mutual savings bank governed by chapter 168 or a mutual co-operative bank governed by chapter 170 may convert into a credit union. If permissible under federal law, a mutual federal savings bank or a mutual federal savings and loan association may also convert into a credit union. The conversion shall comply with all applicable federal laws and regulations. A credit union insured by the Massachusetts Credit Union Share Insurance Corporation shall file notification of its intent to convert with said corporation at least 90 days before the date of the proposed special meeting of the members of the credit union. A mutual savings or co-operative bank insured by the Depositors Insurance Fund shall file notification of its intent to convert with said fund at least 90 days before the date of the proposed special meeting of the corporators or shareholders of the mutual savings or cooperative bank. No credit union, mutual savings bank, or co-operative bank may convert pursuant to this section so long as any financial assistance provided by the Depositors Insurance Fund or the Massachusetts Credit Union Share Insurance Corporation to such credit union, mutual savings bank, or co-operative bank remains unpaid or has not been compromised or settled. Any such repayment, compromise or settlement shall be approved by the commissioner.

(b) A mutual savings bank, co-operative bank or credit union shall file with the commissioner, at the same time, notices, disclosures and communications required by or sent to the National Credit Union Administration or the Federal Deposit Insurance Corporation. The commissioner may require changes and additions to said notices, disclosures or communications, except as required by federal law or regulation.

(c) A mutual savings bank, co-operative bank or credit union that is adequately capitalized and has received at least a satisfactory rating in its most recent examination for compliance with the Community Reinvestment Act may submit a plan of conversion approved by a 2/3 vote of the entire board of directors or trustees to the commissioner. Unless waived by the commissioner, the plan shall include but not be limited to:

(1) a 3 year business plan for the appropriate chartered mutual savings bank, co-operative bank or credit union which shall include pro forma financial statements;

(2) a commitment by the converting credit union that it will not convert to a stock form before the expiration of 1 year of the effective date of the conversion to a mutual savings bank or co-operative bank charter;

(3) an estimated budget for conversion expenses;

(4) financial statements for the most recently completed quarter;

(5) if applicable, the procedures and timing for termination of excess deposit insurance from the Massachusetts Credit Union Share Insurance Corporation or the Depositors Insurance Fund; and

(6) other relevant information that the commissioner may reasonably require.

(d) Included with the plan shall be an information statement to be sent to corporators, shareholders or members which shall fully and fairly disclose all significant terms and steps to be taken for the conversion and shall include but not be limited to:

(1) a statement as to why the board is considering the conversion;

(2) a statement of the major positive and negative business effects of the proposed conversion;

(3) the impact on the member’s financial and other interests in the credit union;

(4) in the case of a credit union converting to a mutual savings bank or co-operative bank,

(a) disclosure that the conversion from a credit union to a mutual savings bank or co-operative bank could lead to a member losing ownership interest in the credit union if the mutual savings bank or co-operative bank subsequently converts to a stock institution and the member does not become a stockholder; and (b) a disclosure of any conversion related economic benefit a director or senior management official may receive including receipt of or an increase in compensation and an explanation of any foreseeable stock related benefits associated with a subsequent conversion to a stock institution. The explanation of stock related benefits shall include a comparison of the opportunities to acquire stock that are available to officials and employees, with those opportunities available to the general membership.

(e) A converting credit union shall file with the commissioner a plan of conversion and an information statement at least 120 days before the date of the proposed special meeting of the members. The commissioner may require reasonable changes to the plan of conversion and information statement. The commissioner may also require any equitable disclosure he determines applicable to the proposed conversion. The commissioner may specify the form, type and other material aspects of the plan of conversion and information statement to be sent to members except to the extent that it does not conflict with federal law or regulation.

(f) The commissioner shall review the contents of the plan before the board of directors of the credit union presents the conversion plan to the members for a vote. The commissioner shall authorize the distribution of the conversion plan and information statement only if the commissioner is satisfied of all of the following:

(1) the plan discloses to the members information concerning the advantages and disadvantages of the proposed conversion;

(2) the information statement discloses the impact on the member’s financial and other interests in the credit union; and

(3) the conversion would not be made to circumvent a pending supervisory action that is initiated by the commissioner or other regulatory agency because of a concern over the safety and soundness of the credit union.

(g) The commissioner shall render a decision within 30 days from the date of the filing of the plan or any amendment thereof. Upon authorization by the commissioner of the distribution of the contents of the conversion plan and information statement, the converting credit union shall call a special meeting of the members to vote on the conversion plan. At least 30 days before the special meeting, the converting credit union shall mail to each member a notice of the special meeting, the conversion plan and information statement.

(h) The plan of conversion of a credit union shall be approved by a majority vote of those members voting. A member may vote on the proposal to convert in person or by electronic means at the special meeting held on the date set for the vote or by written ballot filed by the qualified voter. The vote on the conversion proposal shall be by secret ballot and conducted by an independent entity. The independent entity shall be a company with experience in conducting corporate elections. A director or officer of the converting credit union, or an immediate family member of a director or officer, shall not have an ownership interest in, or be employed by, the entity.

(i) A converting credit union or an officer or director thereof shall not directly or indirectly give or offer or provide a chance to win a lottery or anything of substantial value, as determined by the commissioner, to the membership or a member of the credit union, for an action related to the conversion to a mutual bank or as an inducement to vote on the plan of conversion.

(j) The provisions on notice to members and voting procedures in this section shall govern the process for converting to a mutual bank notwithstanding other provisions of this chapter or a by-law of the converting credit union to the contrary.

(k) Certified copies of the results of the board of the converting mutual savings bank, co-operative bank or credit union meetings and votes of the membership meetings of the credit union shall be filed with the commissioner. The credit union shall also certify that the information statement, plan, and other written materials provided to members were identical to those materials considered satisfactory by the commissioner.

(l) If the commissioner disapproves of the methods by which the membership votes were taken or the procedures applicable to the votes, the commissioner may direct that a new vote be taken. If the commissioner does not disapprove of the methods by which the membership vote was taken within 10 days after the notification is given, the vote shall be considered approved.

(m) If the conversion to a mutual savings bank or co-operative bank is approved by the credit union members or if the conversion to a credit union is approved by the boards of a mutual savings or co-operative bank and the commissioner receives notification from the converting mutual savings bank, co-operative bank or credit union that approvals required under state and federal law and regulations, including approvals needed for deposit insurance by the Federal Deposit Insurance Corporation or the National Credit Union Administration have been obtained, and that any waiting period prescribed by federal law has expired, and in the case of conversion to a mutual savings or co-operative bank, it will become a member of the Depositors Insurance Fund and of the deposit insurance fund thereof, and further, in the case of conversion to a credit union, it will become a member of the Massachusetts Credit Union Share Insurance Corporation and of the share insurance fund thereof and has made all applicable payments thereto as determined by the commissioner, a certificate to transact business shall be issued by the commissioner as applicable. A conversion to a mutual savings, co-operative bank or a credit union under this section shall not be consummated until arrangements satisfactory to the Depositors Insurance Fund or to Massachusetts Credit Union Share Insurance Corporation, as applicable, have been made and notice thereof has been received by the commissioner. After receipt of the certificate to transact business, the converting mutual savings bank, co-operative bank or credit union shall promptly file the certificate and its articles of organization with the secretary of state. Upon the filing, the charter of the converting mutual savings bank, co-operative bank or credit union shall automatically cease and the converting mutual savings bank, co-operative bank or credit union shall become a mutual savings bank, co-operative bank or credit union. Upon the conversion, the converted mutual savings bank, co-operative bank or credit union shall possess all of the rights, privileges and powers granted to it by its articles of organization and by the laws applicable to the type of mutual savings bank, co-operative bank or credit union charter into which it converted, and all of the assets and business of the converting mutual savings bank, co-operative bank or credit union shall be transferred to and vested in it without any deed or instrument of conveyance; but the converting mutual savings bank, co-operative bank or credit union may execute a deed or instrument of conveyance as is convenient to confirm the transfer. The converted mutual savings bank, co-operative bank or credit union shall be subject to all of the duties, relations, obligations and liabilities of the converting mutual savings bank, co-operative bank or credit union, whether as debtor, depository or otherwise, and shall be liable to pay and discharge the debts and liabilities, to perform all the duties in the same manner and to the same extent as if the converted mutual savings bank, co-operative bank or credit union had itself incurred the obligation or liability or assumed the duty or relation. Rights of creditors of the converting mutual savings bank, co-operative bank or credit union and liens upon the property of such mutual savings, co-operative bank or credit union shall be preserved unimpaired and the converted mutual savings bank, co-operative bank or credit union shall be entitled to receive, accept, collect, hold and enjoy all gifts, bequests, devises, conveyances and appointments in favor of or in the name of the converting mutual savings bank, co-operative bank or credit union and whether made or created to take effect before or after the conversion.

(n) If the conversion to a mutual federal savings bank or a mutual federal savings and loan association is approved by the members the converting credit union shall provide notification to the commissioner that all approvals under state and federal law and regulations including approvals needed for deposit insurance by the Federal Deposit Insurance Corporation have been obtained and that any waiting period prescribed by federal law has expired and shall provide a certified copy of the approval of the federal mutual charter by the Office of Thrift Supervision or any successor agency thereto. Upon acceptance of the federal charter, the converting credit union's charter from the commonwealth shall cease to exist.

(o) A person who willfully violates the disclosure provisions of this section knowing the disclosure made to be false or misleading in a material respect shall upon conviction be fined not more than $5,000 or imprisoned not more than 3 years, or both.

SECTION 20.  Chapter 6 of Chapter 294 of the Acts of 1961, as most recently amended by Chapter 323 of the Acts of 2021, is hereby amended by striking out the first three paragraphs and inserting in place thereof the following paragraphs: 

Whenever it shall appear to the commissioner that it is inadvisable or inexpedient for any member to continue to transact the business for which it was organized without receiving financial or other assistance, he may, in his discretion, so notify the directors of the corporation, and thereupon the directors of the corporation may take any action which in their opinion they deem necessary to reduce the risk or avert a threatened loss to the corporation.  Notwithstanding any other provision of law, the corporation may merge or consolidate such member or may facilitate the sale of assets of such member to and the assumption of its liabilities by one or more members.

The directors may also with the approval of the commissioner and in order to effect the purposes of this act, and without limiting the aforesaid powers of the corporation, provide any one or more of the following forms of financial assistance to a member in need of same: (a) purchase from such member the whole or any part of, or any equitable or any other interest in, its assets at the book value thereof, or at some other value mutually agreed upon by the directors of the member credit union and said directors of the corporation, notwithstanding that either of such values may exceed the market value of the assets so purchased, and upon such terms and conditions as said directors with the approval of the commissioner, may determine; (b) make loans to such member, and upon such terms and conditions, as said directors, with the approval of the commissioner, may determine; (c) pay to such member in accordance with an agreement entered into between such member and the corporation, with the approval of the commissioner, an amount not in excess of the difference between the book value of certain or all its assets and the fair value thereof as determined by said agreement, in consideration for which such member shall agree to write down such assets to such fair value and to pay over to the corporation so much of any net proceeds realized from the sale or other disposition of each and all such assets as is in excess of such fair value, such payment to be made in such amounts, at such times and upon such terms and conditions as said directors, with the approval of the commissioner, may determine; provided, that any amount paid by the corporation hereunder to such member and the agreement of such member to repay the excess, as hereinbefore provided, shall constitute liabilities of such member only to the extent of any such excess from time to time actually realized; (d) deposit a sum of money into the loan reserve, investment reserve, undivided earnings or any other surplus accounts of such member in accordance with an agreement entered into between such member and the corporation, with the approval of the commissioner, such member being hereby authorized and empowered, notwithstanding any other provision of law, to repay such amount to the corporation at such time or times and in such manner as such agreement may prescribe; provided, that any such payment made by the corporation to such member, and any agreement of such member to repay the same shall constitute liabilities of such member only to the extent provided by said agreement. Such member, by vote of at least two-thirds of its directors, may take any and all action necessary or advisable to enable it to carry out any or all provisions of this section.

In addition to or apart from the financial assistance authorized under the preceding paragraph, the corporation, by vote of at least 2/3rd of its directors and in order to effect the purposes of this act may, by agreement with a member and with the approval of the commissioner, grant financial assistance to such member by any or all of the methods prescribed in the preceding paragraph and subject to the terms, conditions and benefits contained in clauses (a) to (d), inclusive, of the preceding paragraph, for any of the purposes stated in this section or for the purpose of providing reserve funds for the protection of depositors of such credit unions.

In addition to the financial assistance authorized under the preceding 3 paragraphs, the corporation, by vote of at least 2/3rd of its directors and in order to effect the purposes of this act may also, by agreement with a member and with the approval of the commissioner, grant financial assistance to such member credit union by any or all of the following additional methods for any of the purposes stated in this section or to provide reserve funds for the protection of depositors of such credit union: (a) make a deposit in such member credit union of such amount as the directors deem advisable which deposit shall not be subject to any limits imposed by chapter 171 of the General Laws or the by-laws of the credit union and which may or may not be a subordinated deposit and may or may not be in accordance with an agreement that dividends thereon will be at a lower rate than is paid to the members; (b) assume any liabilities of such member credit union; (c) make loans or contributions to or deposits in, or purchase any assets of, any financial institution which will acquire control of or merge or consolidate with such member credit union or will purchase the assets and assume the liabilities of such member credit union; (d) guarantee such member credit union, or any financial institution which will acquire control of or merge or consolidate with such member credit union or will purchase the assets and assume the liability of such member credit union, against loss by reason of such acquisition of control, merger or consolidation or purchase of assets and assumption of liabilities; or (e) take any other action which the directors in their opinion deem appropriate to carry out the purposes of this section.