Section 29 Conversion of federal savings and loan association to co-operative bank
Section 29. Any federal savings and loan association may convert itself into a co-operative bank upon the same terms and conditions that from time to time shall apply under federal law and regulations to the conversion of a co-operative bank to such an association; provided, however, that where authority is conferred upon the federal home loan bank board or the federal home loan bank, in the case of a conversion from a co-operative bank to such an association, similar authority, in the case of a conversion from such an association to a co-operative bank, unless otherwise expressly provided in this section, is hereby conferred upon the board of bank incorporation.
Any such association shall first give notice in writing to the board of bank incorporation of its intention to convert to a co-operative bank and shall submit such preliminary financial statements and other information concerning its assets liabilities and affairs as said board may request, together with a plan for proposed conversion showing the intended treatment of the various classes of its assets and liabilities before and after conversion. The commissioner, at the expense of such association, shall make such examination of its assets, liabilities and affairs as said board may deem advisable in order to determine the qualifications of such association for doing the business of a co-operative bank.
If, after such examination, said board finds that the percentage that the total reserves of such association bears to its total assets is at least equal to the average percentage that the total reserves of all co-operative banks established under this chapter, including surplus accounts, bears to their total assets, said board may approve such application, but if said percentage of reserves of such association is below such average it shall reject such application, provided, however, that if such association shall comply with such conditions as said board determines, within such time as it specifies, it may thereafter approve such application and plan for conversion, as amended. In its approval, said board also may make provision for such association to carry, for a sufficient period to permit their orderly liquidation or transfer into qualified assets and liabilities, assets and liabilities that are not legally proper for co-operative banks under this chapter. It may also approve the retention by such association of its interest, if any, in any employees’ retirement associations or funds.
If such application is approved by said board as above provided, such association shall cause to be filed with the state secretary the name, residence and post-office address of each of the officers and directors of such association, a copy of its proposed by-laws amended to conform with the requirements of section seven and such other information as said secretary may require.
After approval of such conversion by said board, and receipt by it of satisfactory evidence that all provisions of federal laws and regulations relative to such conversion have been or will be duly complied with, the said board shall cause to be filed with the state secretary a certificate of its approval. After receipt of such certificate by said state secretary, if he finds that the requirements of this section have been satisfactorily complied with, he shall so certify and upon receipt of a fee, the amount of which shall be determined annually by the commissioner of administration under the provision of section three B of chapter seven, said secretary shall issue to said officers and directors in such form as he may prescribe, a certificate of incorporation as a co-operative bank.
Simultaneously with the receipt of such certificate such bank, hereinafter referred to as the succeeding corporation, shall become a member of The Co-operative Central Bank, hereinafter called the central bank, and of the share insurance fund thereof, referred to in section twenty-eight. Before such succeeding corporation shall commence business as a co-operative bank, it shall pay into the reserve fund, referred to in said section twenty-eight of the central bank, an amount equal to the deposit required of a member bank thereof of similar size, as of the date of said certificate, plus such additional amount based upon the surplus of said reserve fund, as the directors of the central bank, with the approval of the commissioner, shall determine to be equitable.
In addition to the payment to said reserve fund, the succeeding corporation shall pay to said share insurance fund or make provision for payment thereto of a sum based upon the relation which the total amount of all assessments, referred to in section one of chapter seventy-three of the acts of nineteen hundred and thirty-four, paid into said share insurance fund by all member banks, exclusive of annual assessments, plus the amount of the earned surplus account of said fund, less all losses and expenses incurred by said fund with respect to co-operative banks which it has assisted or liquidated, bears to the insured liabilities of all member banks; provided, that such payment shall be not less than the sum of six times the average applicable annual assessments paid by member banks during the preceding five years; and provided, further, that the succeeding corporation shall pay to said share insurance fund such proportion of the current annual assessment as shall have accrued to the date of said certificate.
After compliance with the foregoing requirements, the succeeding corporation shall thereafter be entitled to exercise all of the rights and privileges, and shall be subject to all of the duties and obligations of a co-operative bank and shall conduct its business subject to the provisions of this chapter and of other applicable laws; provided that, with the approval of the commissioner, the succeeding corporation shall have reasonable time after the effective date of the conversion within which to comply with any particular provisions of such laws not hereinbefore specifically provided for and which it shall be unable to comply with on or before said date.