2010 New York Code
BNK - Banking
Article 10 - (375 - 413) SAVINGS AND LOAN ASSOCIATIONS
399 - Restrictions on directors and officers.

§ 399.  Restrictions  on  directors  and  officers.  1. No director or
  officer of any savings and loan association shall  receive  any  salary,
  fees,  expenses  or other compensation for soliciting the sale of shares
  of the association to any person.
    2. No officer, director, attorney, agent or employee  of  any  savings
  and loan association shall discount or, directly or indirectly, purchase
  from  a  member of such association a share in such association, whether
  or not withdrawal application has been filed with respect to such share,
  except by payment therefor of the book value  of  such  share.  For  the
  purposes of this subdivision, the book value of a share shall consist of
  the  dues  and  dividends  credited  thereon  and dividends declared but
  withheld subject to payment at maturity.
    3. No director or officer of any savings and loan  association  shall,
  after  June  thirtieth,  nineteen  hundred thirty-nine for himself or as
  agent or partner of another borrow any of the funds of such  association
  or become the owner of real property upon which such association holds a
  mortgage;  except  that  such  officer  or director may borrow from such
  association on the security of shares held by him or on the security  of
  real  estate  owned  by  him  if  used and occupied by him as a home for
  himself or family, or may become the owner of real estate  so  used  and
  occupied  upon  which  the association holds a mortgage. As used in this
  subdivision, the terms "real property", "real  estate",  and  "mortgage"
  shall  be  deemed  to refer to ownership interests in, and security with
  respect to, a cooperative apartment unit.
    4. No director or officer of any savings and  loan  association  shall
  direct  or  require  a borrower on a mortgage to negotiate any policy of
  insurance on the mortgaged property  through  any  particular  insurance
  company or companies or through any particular insurance agent or agents
  and  broker  or brokers or attempt to divert to any particular insurance
  company or companies or any particular insurance  agent  or  agents  and
  broker  or  brokers, the business of borrowers from the savings and loan
  association, or refuse to accept any insurance policy because it was not
  negotiated through  a  particular  insurance  company  or  companies  or
  through a particular insurance agent or agents and broker or brokers.
    5.  (a)  No executive officer of a savings and loan association may be
  an executive officer, director or trustee of another  savings  and  loan
  association, bank or trust company, savings bank, national bank, federal
  savings  bank  or  federal  savings association, the principal office of
  which institution is located in this  state,  bank  holding  company  or
  foreign  banking  corporation  maintaining a branch in this state unless
  permission therefor has been granted by the banking  board  pursuant  to
  paragraph (b) of this subdivision.
    (b)  The banking board shall have the power to determine by regulation
  who shall be considered, under the provisions of this subdivision, to be
  an executive officer, and by a general or specific  regulation,  upon  a
  three-fifths  vote  of  all  its  members,  to  grant  permission  to an
  executive officer of a savings and loan association to be  an  executive
  officer, director or trustee or both an executive officer and a director
  or  a  trustee  of  another  savings and loan association, bank or trust
  company, savings bank, national bank, federal savings  bank  or  federal
  savings  association,  the  principal office of which is located in this
  state, bank holding company or foreign banking corporation maintaining a
  branch in this state. Such permission may be  granted  only  if  in  the
  judgment of the banking board such service by the executive officer will
  be  consistent  with  the policy of the state of New York as declared in
  section ten of this chapter. The banking board shall have the  power  to
  revoke  such  permission  by  a  like  vote  whenever  it  finds,  after

reasonable notice and an  opportunity  to  be  heard,  that  the  public
  interest requires such revocation.
    (c)  For  the  purposes  of  this  subdivision, the term "bank holding
  company" shall be given the same meaning as is contained in section  one
  hundred  forty-one  of  this  chapter,  and  the  definition of the term
  "banking institution" is modified to include a  national  bank,  federal
  savings  bank  or  federal  savings association, the principal office of
  which institution is located  in  this  state,  and  a  foreign  banking
  corporation maintaining a branch in this state.
    (d)  All other restrictions and limitations imposed by this chapter on
  executive officers and directors of savings and loan associations  shall
  continue in effect.