Voluntary Dissolution After Commencement of Business

  1. Law
  2. Georgia Code
  3. Banking and Finance
  4. Financial Institutions
  5. Provisions Applicable to Department of Banking and Finance and Financial Institutions Generally
  6. Permissive Closing Days, Emergency Closings, Business Restrictions, and Voluntary Liquidations
  7. Voluntary Dissolution After Commencement of Business

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  1. A financial institution which has commenced business may elect to dissolve voluntarily upon:
    1. Adoption by the vote required of its shareholders under subsection (b) of this Code section of:
      1. A plan of dissolution involving both a provision for assumption of its liabilities by another financial institution and a provision for continuance of its business if such assumption of its liabilities is not effected; or
      2. Any other plan of dissolution providing for full payment of its liabilities; and
    2. Approval by the department of the plan of dissolution after application for approval thereof in a manner prescribed by the department.
  2. Adoption of the plan by the shareholders of the financial institution shall require the affirmative vote of the shareholders entitled to cast at least two-thirds of the votes which all shareholders are entitled to cast on the plan and, if any class of shareholders is entitled to vote on the plan as a class, of the holders of at least two-thirds of the outstanding shares of such class, provided that, in the case of a credit union, adoption of the plan may be made by the affirmative vote of at least two-thirds of the members present and entitled to vote at a meeting duly called for that purpose.
  3. Upon receipt of an application for approval of a plan of dissolution, the department shall conduct such investigation as it may deem necessary to determine whether:
    1. The plan satisfies the requirements of this chapter;
    2. The plan adequately protects the interests of depositors, other creditors, and shareholders; and
    3. If the plan involves an assumption of liabilities by another financial institution, such assumption would be consistent with adequate and sound banking and in the public interest on the basis of factors substantially similar to those set forth in Code Section 7-1-534.
  4. Within 90 days after receipt of the application, the department shall approve or disapprove the application on the basis of its investigation and shall immediately give to the financial institution written notice of its decision and, in the event of disapproval, a general statement of the reasons for its decision. The decision of the department shall be conclusive, except as it may be subject to judicial review under Code Section 7-1-90.

(Ga. L. 1919, p. 135, art. 14, §§ 1, 2, 10; Code 1933, §§ 13-1501, 13-1502, 13-1510; Ga. L. 1967, p. 597, § 1; Code 1933, § 41A-503, enacted by Ga. L. 1974, p. 705, § 1; Ga. L. 1977, p. 730, § 2; Code 1933, § 41A-505, as redesignated by Ga. L. 1978, p. 1714, § 3; Ga. L. 2020, p. 493, § 7/SB 429.)

The 2020 amendment, effective July 29, 2020, part of an Act to revise, modernize, and correct the Code, substituted "provided that, in the case" for "provided, in the case" in the middle of subsection (b).

RESEARCH REFERENCES

Am. Jur. 2d.

- 10 Am. Jur. 2d, Banks and Financial Institutions, § 207 et seq.

11 Am. Jur. 2d, Banks and Financial Institutions, §§ 1020, 1182.

C.J.S.

- 9 C.J.S., Banks and Banking, § 593 et seq.

ALR.

- Trust or preference in respect of money placed in bank for purpose of transaction with third person where bank subsequently becomes insolvent, 31 A.L.R. 472; 93 A.L.R. 881.

Right of creditors or stockholders of insolvent bank in charge of liquidating officer who refuses or fails to enforce liability of third persons to bank, to maintain action for that purpose, and conditions of such right, 116 A.L.R. 783.


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