2020 New York Laws
BNK - Banking
Article 10 - Savings and Loan Associations
378 - Power to Issue Shares; Dues Thereon.

§ 378.  Power to issue shares; dues thereon. 1. Every savings and loan
association  shall  be  either  permanent  or  serial  in  character.  A
permanent  association  shall be one which issues instalment shares, not
in series, and credits dividends thereon to the holders of  such  shares
individually.  A serial association shall be one which issues instalment
shares in series and credits the dividends apportioned to such shares by
series. No additional shares shall be  issued  in  any  series  after  a
dividend has been credited thereto unless the person to whom such shares
shall  be  issued  shall  pay  therefor  the  book  value of such shares
including the estimated accrued dividend thereon since the close of  the
preceding  dividend  period.  Dividends credited by a serial association
upon shares issued by it other than instalment shares may be credited to
the holders of such shares individually.
  2. The members of a savings and loan association shall be:  (1)  those
persons  who  are the holders of record of shares whose membership shall
continue until such shares have matured and  been  paid,  or  have  been
withdrawn,  retired,  suspended,  forfeited, or transferred; and (2) all
borrowers  from  the  association  and  all  persons  obligated  to  the
association on loans whose membership shall continue until such loans or
obligations  have  been  paid. Each member shall be entitled to at least
one vote upon all question  at  any  meeting  of  such  members  of  the
association,  except  when  by  statute the vote is required to be based
upon the capital of the association. Every member entitled to vote at  a
meeting  of  members  of the association may authorize another person or
persons to act for him by proxy, but no director, officer, clerk, teller
or bookkeeper of the savings and loan association shall act as proxy  at
any  meeting  of  such  association.  Every  proxy must be signed by the
member or his attorney-in-fact.  No  proxy  shall  be  valid  after  the
expiration  of  eleven  months  from  the  date thereof unless otherwise
provided in the proxy. Every proxy shall be revocable at the pleasure of
the member executing it. The authority of the holder of a proxy  to  act
shall  not  be  revoked  by  the incompetence or death of the member who
executed the proxy unless, before the authority  is  exercised,  written
notice  of  an  adjudication  of  such  incompetence or of such death is
received by the officer of the association responsible  for  maintaining
the  list  of members. The by-laws may prohibit or further limit proxies
for members and their duration. No director or officer of a savings  and
loan association shall be eligible to act as an inspector of an election
of directors at any meeting of members of the association.
  3. The capital of every such association shall consist of the dues and
dividends  credited to its members upon their shares either individually
or by series, time deposits held by such association pursuant to section
three hundred seventy-eight-a of this  chapter  together  with  interest
accrued  on  such deposits, and demand deposits held by such association
pursuant to subdivision thirteen of section three  hundred  eighty-three
of this chapter.
  4.  Any savings and loan association may issue shares of the following
classes: (a) Instalment shares, class one, upon which  regular  payments
of  dues  shall  be  made as provided in the by-laws of the association,
until such shares reach their matured value or are withdrawn, retired or
forfeited; and  instalment  shares,  class  two,  which  shall  have  no
participation  in dividends and upon which the dues payable in regularly
increasing amounts are applied  in  reduction  of  a  debt  due  to  the
association  from  the  holder  of  such  shares  in  accordance  with a
direction given by him.
  (b) Savings shares, upon which dues shall be paid  in  such  sums,  at
such  times and for such purposes as the holder thereof may elect, until
the shares are withdrawn or retired. Upon  the  request  of  the  holder

thereof, such savings shares may be converted by the issuing association
into special savings shares authorized for issuance by paragraph (bb) of
this  subdivision.  The  association  may  enter  such conversion in its
records  and  on  the  evidence of ownership of the savings shares as an
alternative to withdrawal  or  retirement  of  the  savings  shares  and
issuance of special savings shares.
  (bb) Subject to such limitations and restrictions as may be prescribed
by  regulation  of  the  superintendent  of  financial services, special
savings shares, upon which dues shall be paid  in  such  sums,  at  such
times  and  for such purposes as the holder thereof may elect, and which
shall provide that dividends shall be credited from the date  of  actual
receipt  of  such  dues  to  the  date  they  are  withdrawn or retired.
Dividends on special savings shares shall be credited and shall be  made
available  no later than the end of a regular dividend period, or at the
time such special savings shares are withdrawn  or  retired  if  in  the
opinion  of  a majority of the board of directors it appears the savings
and loan association will have sufficient profit available at the end of
such regular dividend period to  pay  dividends  and  if  the  board  of
directors  chooses  payment  of  dividends at withdrawal as an option to
periodic payment of dividends. Any savings and  loan  association  which
does  not  make  dividends  available pursuant to the provisions of this
paragraph shall promptly notify the superintendent of financial services
of such decision. Withdrawals or retirements of special  savings  shares
during  the  last three business days of any regular dividend period or,
in the event that any  one  of  such  last  three  business  days  is  a
Saturday,  withdrawals of such shares upon one of the last four business
days of any such period may receive dividends apportioned for  the  full
period.
  (c) Accumulative prepaid shares upon which a single payment of dues to
the  amount  of  fifty  per  centum or more of the matured value thereof
shall be paid at the time when such shares are issued. The  whole  or  a
part  of  the  dividends  apportioned  to  such shares shall be credited
thereto until such shares are matured, withdrawn or retired. Any balance
of such dividends not so credited shall be paid in cash.
  (d) Income shares, upon which a single payment of  dues  amounting  to
one hundred dollars per share shall be paid at the time when such shares
are  issued.  The  dividends on such shares shall be paid in cash or, in
accordance with the written order of the holder, applied to the purchase
of other shares in the association. Income shares may  be  issued  which
shall not be withdrawable without the consent of the board of directors,
until the expiration of a fixed period, which shall be not more than ten
years.  Whenever  income  shares  are  issued which are not withdrawable
until the expiration of a fixed period, a statement that  they  are  not
withdrawable  until the expiration of such fixed period shall be printed
upon the face  of  the  certificate  of  shares  or  other  evidence  of
ownership  in  such  manner  as  to  be  clearly  legible.  Whenever any
association is  unable  to  locate  the  holder  of  income  shares  and
dividends shall have been apportioned which cannot be paid to the holder
thereof  by  reason  of the inability of such association to locate such
holder, such association may credit such dividends as dues upon  another
class  of  shares  in the name of holder of such income shares and shall
carry such other shares and any accumulations thereon for the benefit of
such shareholder. Income shares which are  not  withdrawable  until  the
expiration of a fixed period shall be termed "income shares, class two."
Other income shares shall be termed "income shares, class one."
  (e)  Cumulative  income  shares upon which a single payment of dues of
not less than one hundred dollars shall be paid at the time such  shares
are  issued.  The dividends on such shares may be credited thereto until

such shares are matured, withdrawn or retired. Cumulative income  shares
may be issued which shall not be withdrawable without the consent of the
board  of directors, until the expiration of a fixed period, which shall
be  not  more  than  ten  years  nor  less  than  ninety  days. Whenever
cumulative income shares are issued which are not withdrawable until the
expiration of a fixed period, a statement that they are not withdrawable
until the expiration of such fixed period shall be printed upon the face
of the certificate of shares or other  evidence  of  ownership  in  such
manner  as to be clearly legible. Cumulative income shares which are not
withdrawable until the expiration of a  fixed  period  shall  be  termed
"cumulative  income  shares,  class two." Other cumulative income shares
shall be termed "cumulative income shares, class one."
  5. All shares hereafter issued by any  savings  and  loan  association
shall  have  a  matured  value  of  one  hundred  dollars,  except  that
instalment shares may be issued having a matured value of not less  than
one hundred nor more than two hundred fifty dollars.
  6.  Shares  issued in the name of more than one person shall confer no
greater voting rights than if issued in the name of one person.
  7. Persons who hold shares in a fiduciary capacity shall have all  the
rights and privileges of membership, except to hold office.
  8. A savings and loan association shall have a lien upon the shares of
its  members  to the extent of any lawful fines or other obligations due
to it, whether or  not  such  shares  are  specifically  transferred  or
pledged  to  it,  and may, at its option, after five days' notice to the
member, apply such shares toward the payment of any matured  obligations
due it.
  9.  A  savings  and  loan  association may in its discretion accept or
refuse advance payments of dues.
  10. Notwithstanding any provision of this chapter, a savings and  loan
association,  in  its  organization  certificate,  by-laws,  advertising
matter or any other instrument, document or other writing used in or  in
connection  with  its  business,  may  designate  its shares as "deposit
accounts" or "savings accounts" its members as "depositors", its dues or
share payments as "deposits", and its capital  as  "deposit  liability".
The  use  of any term permitted by this subdivision shall not affect any
right,  duty,  privilege  or  liability  which  the  savings  and   loan
association, any member or any depositor would otherwise have.