45-4-1108 - Capital contribution Additions Special assessments Dividends.
45-4-1108. Capital contribution Additions Special assessments Dividends.
(a) In order to provide a capital fund for carrying out the purposes of the corporation pursuant to § 45-4-1102, the corporation shall bill and collect from all credit unions accepted for membership an initial capital contribution not to exceed one percent (1%) of all insured shares, accounts, and certificates of the credit union with the approval of the commissioner. The corporation shall annually declare and collect additions to the capital account as the corporation may deem appropriate, except to the extent that refunds have been paid under subsection (b).
(b) The capital contribution of each member credit union shall be refunded to each member credit union when the unencumbered funds of the corporation exceed two percent (2%) of the aggregate total of all shares, accounts and certificates of member credit unions by an amount equal to the aggregate capital contributions of all members, as determined by the annual report of the commissioner or the annual report of the supervisory agency of the credit unions in each state in which credit unions have become members of the corporation under § 45-4-1107(c). A portion of the capital contribution of each member credit union may, with the prior approval of the commissioner, be refunded to each member credit union, though the unencumbered funds of the corporation do not exceed two percent (2%) of the aggregate total of all shares, accounts and certificates of member credit unions by an amount equal to the aggregate capital contributions of all members as determined by the method specified in this section, if the board of directors of the corporation deems a partial refund to be in the best interest of the corporation. These refunds shall be paid to the then existing member credit unions in proportion to their capital contribution.
(c) At the option of the board of directors of the corporation, the corporation may exclude from its calculations of the capital contribution required by subsections (a) and (b), the share holdings and deposits of shareholders and depositors of member credit unions that either are not protected or guaranteed by the corporation or that are in excess of the primary amount of loss to be protected or guaranteed by the corporation pursuant to § 45-4-1102(1).
(d) In the event of potential impairment of the corporation's capital fund, a special assessment to the capital fund may be levied by the corporation with the approval of the commissioner or, in addition or as an alternative to a special assessment, the corporation may issue debt instruments the board of directors of the corporation deems appropriate with the approval of the commissioner.
(e) The corporation may also, subject to the prior approval of the commissioner, declare a dividend from net earnings annually. The dividend shall be paid on the amount of paid-in membership capital as defined in subsection (a). When capital contributions have not been fully paid during the entire preceding dividend period, a proportional part of the dividend may be paid.
(f) In case of the liquidation of this corporation, the funds shall be paid to the then existing member credit unions in proportion to contributions to the capital fund including any special assessments paid.
[Acts 1974, ch. 577, § 8; 1978, ch. 553, §§ 2, 3; T.C.A., § 45-1842; Acts 1982, ch. 603, §§ 1, 2; 1983, ch. 93, § 5; 1984, ch. 715, § 4; 1985, ch. 18, § 1.]