(1) Except as otherwise provided in this section, a savings bank or savings bank officer shall not give preference to a depositor or creditor by pledging the assets of the savings bank as collateral security or otherwise.
  (2) A savings bank may pledge its assets in an amount not in excess of 10% of its total assets for the purpose of securing the following:

Terms Used In Michigan Laws 487.3508

  • Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
  • Bank: means a state banking corporation organized or reorganized under the provisions of the banking code of 1999, 1999 PA 276, MCL 487. See Michigan Laws 487.3102
  • Bankruptcy: Refers to statutes and judicial proceedings involving persons or businesses that cannot pay their debts and seek the assistance of the court in getting a fresh start. Under the protection of the bankruptcy court, debtors may discharge their debts, perhaps by paying a portion of each debt. Bankruptcy judges preside over these proceedings.
  • Commissioner: means the commissioner of the office of financial and insurance services. See Michigan Laws 487.3102
  • Depository institution: means a bank, out-of-state bank, national bank, association, savings bank, cooperative bank, industrial bank, or credit union organized under the laws of this state, another state, the District of Columbia, the United States, or a territory or protectorate of the United States. See Michigan Laws 487.3102
  • Federal reserve act: means the federal reserve act, chapter 6, 38 Stat. See Michigan Laws 487.3102
  • Federal Reserve System: The central bank of the United States. The Fed, as it is commonly called, regulates the U.S. monetary and financial system. The Federal Reserve System is composed of a central governmental agency in Washington, D.C. (the Board of Governors) and twelve regional Federal Reserve Banks in major cities throughout the United States. Source: OCC
  • Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
  • Member: means a person holding a savings account of a mutual savings bank. See Michigan Laws 487.3103
  • Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
  • Savings bank: means a state banking corporation organized or reorganized under this act. See Michigan Laws 487.3103
  • shall not apply: means that the pertinent provision is not operative as to certain persons or things or in conjunction with a particular date or dates. See Michigan Laws 8.4c
  • state: when applied to the different parts of the United States, shall be construed to extend to and include the District of Columbia and the several territories belonging to the United States; and the words "United States" shall be construed to include the district and territories. See Michigan Laws 8.3o
  • Surplus: means the amount paid for issued and outstanding common and preferred stock in excess of the stated par value, plus any amount of transferred undivided profits, and any additional amounts paid in or contributed to increase total capital. See Michigan Laws 487.3103
  • United States: shall be construed to include the district and territories. See Michigan Laws 8.3o
  (a) Funds belonging to the United States or belonging to or being administered by an officer, instrumentality, or agent of the United States, funds of estates being administered by a federal court under a federal bankruptcy law, and other funds when required or permitted to do so under the laws of the United States or an order of a federal court.
  (b) Surplus funds of the state held by the state treasurer.
  (c) Funds of the Mackinac bridge authority, which is declared to be a political subdivision of this state, under 1950 (Ex Sess) PA 21, MCL 254.301 to 254.304.
  (d) Funds of the international bridge authority, which is declared to be a political subdivision of this state, under 1954 PA 99, MCL 254.221 to 254.240.
  (e) Funds on deposit under 1941 PA 205, MCL 252.51 to 252.64, providing for limited access highways.
  (f) Funds on deposit to the credit of the Michigan employment security commission.
  (g) Funds of the Michigan state housing development authority constituting proceeds of the sale of the authority’s notes and bonds and repayments of those notes and bonds, under the state housing development authority act of 1966, 1966 PA 346, MCL 125.1401 to 125.1499c.
  (h) Funds belonging to any political subdivision of this state.
  (i) Funds belonging to any federally recognized Indian tribe.
  (j) Funds representing the proceeds of a grant or loan from a department or agency of the United States, the award of which is conditioned upon the recipient depositing the proceeds in an account secured by a pledge of assets of the depository institution.
  (3) The requirements, restrictions, and limitations imposed by this section shall not apply to the pledging of an obligation of the United States, direct or fully guaranteed, or both, for the purpose of securing a deposit of the United States when the deposit is established coincidentally with the purchase of an obligation of the United States by or through an institution.
  (4) A savings bank may pledge its assets to secure liabilities of all of the following types:
  (a) In the case of member banks, liabilities incurred under the federal reserve act, chapter 6, 38 Stat. 251. In the case of nonmember banks, liabilities incurred through borrowing under the same conditions as are imposed upon members of the federal reserve system by the federal reserve act, chapter 6, 38 Stat. 251.
  (b) In the case of federal home loan bank members, liabilities incurred under the federal home loan bank act, chapter 522, 47 Stat. 725.
  (c) Liabilities incurred under former section 202 of title II of the federal farm loan act.
  (d) Liabilities incurred on account of a loan made with the express approval of the commissioner under section 433(c).
  (e) Liabilities incurred on account of borrowings from 1 business day to the next under section 19 of the federal reserve act, chapter 6, 38 Stat. 251.
  (f) Liabilities incurred on account of securities sold under a repurchase agreement.
  Previous section
Next section  
 Chapter 5 Contents