(a) A locally regulated or federally regulated bank may convert its charter to a District credit union charter under this subchapter, subject to applicable local and federal laws and regulations governing the bank.
(b) The Commissioner shall prescribe procedures by which a locally regulated or federally regulated bank may convert to a District credit union charter, and those procedures shall include the following:
(1) The converting bank shall prepare and submit to the Commissioner a conversion plan that provides how the converting bank will:
(A) Comply with the membership requirements under this subchapter, including the possible divestiture of customers who do not meet membership limitations;
(B) Convert its board to a voluntary, non-paid structure if the District credit union does not provide for the compensation of its directors;
(C) Divest its board of stock options;
(D) Divest its capital stock;
(E) Phase out all impermissible investments; and
(F) Comply with District credit union business loan limitations.
(2) A converting bank shall perform a complete policy review to address appraisal restrictions, lending restrictions, investment restrictions, corporate structure restrictions, and power structure to ensure compliance with this subchapter and the Commissioner's rules.
(c) The conversion plan shall be adopted by not less than a majority of the board of directors of the converting bank.
(d) Upon approval of a plan of conversion by the board of directors of a converting bank, the conversion plan and certified copy of the resolution of the board of directors approving the conversion plan shall be submitted to the Commissioner for approval.
(e) The Commissioner may authorize a District credit union resulting from a charter conversion under this subchapter to:
(1) Windup any activities that the converting bank legally engaged in at the effective time of the charter conversion but that otherwise are not permitted for District credit unions; or
(2) Retain, for a transitional period, any assets that the converting bank legally held at the effective time of the charter conversion that otherwise may not be held by District credit unions.
(f) The terms and conditions for the windup of activities under subsection (e)(1) of this section, and the retention of assets under subsection (e)(2) of this section shall be at the Commissioner's discretion; except, that the transitional period during which activities under subsection (e)(1) of this section may be carried out or assets retained under subsection (e)(2) of this section shall not exceed 10 years after the effective date of the charter conversion.