§ 7-48-108 — Membership - loans from members

(1) Any financial institution is
authorized to become a member of a corporation by making application to the
board of directors on such form and in such manner as the board of directors may
require, and membership shall become effective upon acceptance of the
application by said board. Membership shall be for the duration of the corporation;
but upon written notice given to the corporation two years in advance, a member
may withdraw from membership at the expiration date of the notice and shall not
thereafter be obligated to make any loans to the corporation.

(2) Every member shall make loans to the corporation as and when called
upon by it to do so, upon such terms and conditions as approved from time to time
by the board of directors, subject to the following conditions:

(a) All loans shall be evidenced by negotiable instruments of the corporation
and shall bear interest at a rate of not less than one-half of one percent in excess of
the rate of interest determined by the board of directors to be the prime rate on
unsecured commercial loans as of the date of the loan.

(b) All loan limits shall be established at the thousand dollar amount nearest
to the amount computed in accordance with the provisions of this section.

(c) No loan to a development corporation shall be made if immediately
thereafter the total amount of the obligations of the said corporation would exceed
ten times the amount then paid in on its outstanding capital stock.

(d) (I) The total amount outstanding at any one time on loans to a
development corporation made by any member must not exceed the lesser of
twenty percent of the total amount then outstanding on loans to such development
corporation by all members thereof, two hundred fifty thousand dollars, or the
following limit to be determined as of the time a member becomes a member on the
basis of figures contained in the most recent year-end statement prior to its
application for membership:

(A) Three percent of the capital and permanent surplus of banks and trust
companies;

(B) Three percent of the total reserve and surplus accounts of a savings and
loan association;

(C) One percent of the capital and unassigned surplus of stock insurance
companies, except fire insurance companies;

(D) One percent of the unassigned surplus of mutual insurance companies,
except fire insurance companies;

(E) One-tenth of one percent of the assets of fire insurance companies; and

(F) Comparable limits for other financial institutions as established by the
board of directors of the development corporation.

(II) All loan limits shall be recomputed as of the first day of January of each
even-numbered year, but no member's loan limit shall be increased as the result of
such recomputation without the consent of the member.

(e) Each call for loans made by the corporation shall be prorated among the
members of the corporation in substantially the same proportion that the adjusted
loan limit of each member bears to the aggregate of the adjusted loan limits of all
members. The adjusted loan limit of a member shall be the amount of such
member's loan limit reduced by the balance of outstanding loans made by the
member to the corporation and the investment of such member in capital stock of
the corporation at the time of the call.

(f) A member of a corporation created under this article shall not be a
member of more than one such corporation.

Legislative History

Source: L. 65: p. 449, � 1. C.R.S. 1963: � 31-23-8. L. 2013: IP(2) and (2)(d) amended, (SB 13-154), ch. 282, p. 1469, � 24, effective July 1.