North Dakota Code 10-30-08 – Nonstockholder members – Loan limitation
1. The nonstockholder members of the corporation are those national or state banks, savings banks, savings and loan associations, trust companies, stock or mutual insurance companies, the Bank of North Dakota, credit unions, and other financial institutions that apply for membership in the corporation, and membership becomes effective upon the acceptance of the application by the board of directors. Each member of the corporation shall lend money to the corporation when called upon by it to do so on the terms and other conditions as are approved from time to time by a majority of the directors.
Terms Used In North Dakota Code 10-30-08
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Fiscal year: The fiscal year is the accounting period for the government. For the federal government, this begins on October 1 and ends on September 30. The fiscal year is designated by the calendar year in which it ends; for example, fiscal year 2006 begins on October 1, 2005 and ends on September 30, 2006.
- following: when used by way of reference to a chapter or other part of a statute means the next preceding or next following chapter or other part. See North Dakota Code 1-01-49
- Individual: means a human being. See North Dakota Code 1-01-49
- State: when applied to the different parts of the United States, includes the District of Columbia and the territories. See North Dakota Code 1-01-49
- written: include "typewriting" and "typewritten" and "printing" and "printed" except in the case of signatures and when the words are used by way of contrast to typewriting and printing. See North Dakota Code 1-01-37
2. The total amount of loans by any member at any one time shall not exceed the following limit, determined on the basis of the balance sheet of that member at the close of its second preceding fiscal year, as certified by its proper officers:
a. For commercial banks and trust companies and the Bank of North Dakota, two and one-half percent of capital and surplus.
b. For savings banks, two and one-half percent of one-half of the total surplus accounts.
c. For savings and loan associations and credit unions, two and one-half percent of the guaranty funds, surplus, and undivided profits.
d. For stock insurance companies, two and one-half percent of the capital and surplus.
e. For mutual insurance companies, two and one-half percent of the guaranty funds or of the surplus, whichever is applicable.
f. For other nonstockholder members, comparable limits approved by the board of directors.
3. All loan limits must be established at the thousand dollar amount nearest to the amount computed in accordance with subsection 2. All calls of funds which nonstockholder members are committed to lend to the corporation must be prorated by the corporation among the nonstockholder members in the same proportion that the individual lines of credit bear to the aggregate lines of credit. Upon sixty days’ written notice, a member of the corporation may withdraw from membership in the corporation at the expiration date of the notice, and after that expiration date, is free of obligations except those accrued before the expiration date.