(1)Every association shall
maintain general reserves for the sole purpose of meeting losses. Such reserves
shall include the following: Permanent stock, federal insurance reserve, contingent
reserve, state tax reserve, and any special purpose reserve established for the sole
purpose of absorbing losses by action of the association's board of directors or at
the request of the commissioner.
(3)Every association shall set up and maintain a contingent reserve by
transfers from net earnings on the closing date fixed for such associations as
provided in articles 40 to 46 of this title 11.
(4)An association may set up and maintain a state tax reserve, in
accordance with article 2 of title 29 and articles 20 to 28 of title 39, by annual
transfers from the contingent r
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(1) Every association shall
maintain general reserves for the sole purpose of meeting losses. Such reserves
shall include the following: Permanent stock, federal insurance reserve, contingent
reserve, state tax reserve, and any special purpose reserve established for the sole
purpose of absorbing losses by action of the association's board of directors or at
the request of the commissioner.
(2) Repealed.
(3) Every association shall set up and maintain a contingent reserve by
transfers from net earnings on the closing date fixed for such associations as
provided in articles 40 to 46 of this title 11.
(4) An association may set up and maintain a state tax reserve, in
accordance with article 2 of title 29 and articles 20 to 28 of title 39, by annual
transfers from the contingent reserve. The state tax reserve shall be considered as
a part of the contingent reserve.
(5) Any losses may be charged against general reserves; except that losses
may not be charged against permanent stock until all other reserves available for
losses have been depleted. Moreover, losses may not be charged to the contingent
reserve until any special reserve set up to absorb such losses has been exhausted.
Any determined excess in any other reserve may be transferred to the contingent
reserve. Allowance for depreciation of assets shall not be charged against general
reserves but shall be charged to undivided profits, surplus, or net earnings.
(6) As of each closing date fixed for such association as provided in articles
40 to 47 of this title, each association shall transfer to general reserves an amount
which is not less than five percent of its net earnings until general reserves are
equal to ten percent of invested capital (excluding permanent stock). If, after
having reached ten percent, general reserves should fall below ten percent of
invested capital (excluding permanent stock), credits of five percent of net income
shall be resumed until general reserves shall again equal ten percent of invested
capital (excluding permanent stock). General reserves may be increased over the
required ten percent in any amount as may be determined by the board of directors
to be for the best interest of the association. Notwithstanding the number of
closing dates fixed for an association, not more than two such transfers shall be
required annually, but more frequent transfers may be made by an association with
the approval of the commissioner.
(7) As of each closing date fixed for such association as provided in articles
40 to 47 of this title, the board of directors of each association shall declare a
dividend on all share accounts, if any, that it then has and may also, from net
earnings, declare a dividend on permanent stock in such association, but no
association shall be required to distribute earnings on Christmas savings shares or
deposits or other short-term savings shares or deposits or on share or deposit
balances of less than an amount specified by the board of directors, if said amount
is disclosed to shareholders or depositors in advance, including reasonable notice
of changes. In lieu of or in addition to such net earnings, all or any part of undivided
profits or surplus of an association may be likewise distributed, but no funds
received as part of the sale price of permanent stock or paid in as an assessment
shall be distributed as a cash dividend on permanent stock.
(8) Dividends shall be declared on and pro rata to the certificate value of
each share at the beginning of the dividend period, plus payments made thereon
during the dividend period (less amounts withdrawn and, for purposes of
participation in earnings, deducted from the latest previous payments), computed
at the declared rate for the time invested, determined as provided in subsection (9)
of this section.
(9) The date of investment shall be the date of actual receipt of such
payments by the association unless the board of directors fixes a date, not later
than the tenth of the month, for determining the date of investment of payments on
shares or designated classes thereof. Payments affected by such determination
date, received by the association on or before such determination date, shall
receive earnings as if invested on the first of such month.
(10) Payments affected by such determination date, received subsequent to
such determination date, shall receive earnings as if invested on the first of the
next succeeding month.
(11) In all mutual associations issuing limited dividend shares, no dividends
shall be paid or credited on fully participating free shares until all current maximum
dividends on limited dividend shares have been paid or credited and until at least an
equal dividend has been credited to fully participating loan shares.
(12) In permanent stock associations, no dividends shall be declared on the
permanent stock until all current maximum dividends on limited dividend shares
have been paid or credited.
(13) With approval of the commissioner, associations may pay a variable rate
of dividends on shares.
(14) Notwithstanding any provision of the Colorado Savings and Loan
Association Law, articles 40 to 46 of this title 11, any association may distribute
earnings on its shares on other dates, on other bases, and in accordance with other
terms and conditions as may be authorized by regulations made by the federal
deposit insurance corporation or its successor for federal savings and loan
associations when the regulations are approved by the commissioner.
(15) A depreciation reserve, an unearned profits account, an interest due and
uncollected account, and a bonus reserve shall be set up and maintained when
required.