Committee advances bill to authorize cooperative financial institution charters with amendments

House Bill 1507 would create a state-charter option for cooperative financial institutions, including mutual banks and similar entities, and set organizational and governance requirements. Representative Volmer (sponsor) explained the measure as restoring a state mutual-charter option that existed historically and would allow some institutions to convert from federal to state charters.

Committee members and Department of Financial Institutions staff discussed specifics of the amendment the sponsor proposed. Key changes the committee approved included clarifying that bylaws must specify quorum and authorized deposit accounts, and that a board of directors must include at least two members with appropriate banking experience and members who are U.S. citizens and North Dakota residents. Department staff and bankers explained “appropriate banking experience” would be assessed by the banking board during charter review.

Representative Ruby moved an amendment (cleanups and bylaw clarifications); the committee adopted the amendment by voice vote and later approved a do-pass recommendation for the bill as amended. Committee members said the measure provided a business-friendly option for chartering institutions under state law while leaving regulatory approvals with the Department of Financial Institutions and state banking authorities.

Representative Ruby told the committee she would carry the bill to the floor unless another member volunteered to do so.