Section 6-06-08.4 - Prompt corrective action1. For purposes of this section, the net worth categories are defined as: a. Well capitalized. A credit union with a net worth ratio of seven percent or greater which meets any applicable risk-based net worth requirement.b. Adequately capitalized. A credit union with a net worth ratio six percent or more but less than seven percent which meets any applicable risk-based net worth requirement as defined by the state credit union board by rule.c. Undercapitalized. A credit union with a net worth ratio of four percent or more but less than six percent or fails to meet any risk-based net worth requirement.d. Significantly undercapitalized. A credit union with a net worth ratio of two percent or more but less than four percent, fails to increase its net worth, or fails to submit or materially implement a net worth restoration plan.e. Critically undercapitalized. A credit union with a net worth ratio less than two percent.2. A credit union may be reclassified into the next subordinate net worth category by the commissioner or the state credit union board if it is determined that the credit union is in an unsafe or unsound condition or has not corrected unsafe or unsound practices of which it was, or should have been, aware. The board or commissioner may order a credit union that is adequately capitalized, undercapitalized, significantly undercapitalized, or critically undercapitalized to take prompt corrective action to increase the credit union's net worth. Additionally, the order may require a credit union that is undercapitalized, significantly undercapitalized, or critically undercapitalized to submit an acceptable net worth restoration plan to the commissioner. A credit union may request a hearing before the state credit union board within ten days of the order to review the factual basis used to issue the request for prompt corrective action. The decision made by the board during this hearing is final. If a hearing is not requested, the initial decision of the commissioner or board is final. For a significantly undercapitalized credit union that has no reasonable prospect of becoming adequately capitalized or a critically undercapitalized credit union, the commissioner or board may take possession of the credit union or appoint a conservator or liquidating agent for the credit union in accordance with chapter 6-07.2.Amended by S.L. 2021, ch. 77 (SB 2102),§ 8, eff. 8/1/2021.Amended by S.L. 2011, ch. 74 (HB 1131),§ 7, eff. 8/1/2011.