§ 399 — Restrictions on directors and officers

New York § 399

• Jurisdiction: New York
• Law BNK: Banking
• Art. 10: Savings and Loan Associations

Text

§ 399. Restrictions on directors and officers. 1. No director or\nofficer of any savings and loan association shall receive any salary,\nfees, expenses or other compensation for soliciting the sale of shares\nof the association to any person.\n 2. No officer, director, attorney, agent or employee of any savings\nand loan association shall discount or, directly or indirectly, purchase\nfrom a member of such association a share in such association, whether\nor not withdrawal application has been filed with respect to such share,\nexcept by payment therefor of the book value of such share. For the\npurposes of this subdivision, the book value of a share shall consist of\nthe dues and dividends credited thereon and dividends declared but\nwithheld subject to payment at maturity.\n 3. No director or officer of any savings and loan association shall,\nafter June thirtieth, nineteen hundred thirty-nine for himself or as\nagent or partner of another borrow any of the funds of such association\nor become the owner of real property upon which such association holds a\nmortgage; except that such officer or director may borrow from such\nassociation on the security of shares held by him or on the security of\nreal estate owned by him if used and occupied by him as a home for\nhimself or family, or may become the owner of real estate so used and\noccupied upon which the association holds a mortgage. As used in this\nsubdivision, the terms "real property", "real estate", and "mortgage"\nshall be deemed to refer to ownership interests in, and security with\nrespect to, a cooperative apartment unit.\n 4. No director or officer of any savings and loan association shall\ndirect or require a borrower on a mortgage to negotiate any policy of\ninsurance on the mortgaged property through any particular insurance\ncompany or companies or through any particular insurance agent or agents\nand broker or brokers or attempt to divert to any particular insurance\ncompany or companies or any particular insurance agent or agents and\nbroker or brokers, the business of borrowers from the savings and loan\nassociation, or refuse to accept any insurance policy because it was not\nnegotiated through a particular insurance company or companies or\nthrough a particular insurance agent or agents and broker or brokers.\n 5. (a) No executive officer of a savings and loan association may be\nan executive officer, director or trustee of another savings and loan\nassociation, bank or trust company, savings bank, national bank, federal\nsavings bank or federal savings association, the principal office of\nwhich institution is located in this state, bank holding company or\nforeign banking corporation maintaining a branch in this state unless\npermission therefor has been granted by the superintendent of financial\nservices pursuant to paragraph (b) of this subdivision.\n (b) The superintendent shall have the power to determine by regulation\nwho shall be considered, under the provisions of this subdivision, to be\nan executive officer, and by regulation,, to grant permission to an\nexecutive officer of a savings and loan association to be an executive\nofficer, director or trustee or both an executive officer and a director\nor a trustee of another savings and loan association, bank or trust\ncompany, savings bank, national bank, federal savings bank or federal\nsavings association, the principal office of which is located in this\nstate, bank holding company or foreign banking corporation maintaining a\nbranch in this state. Such permission may be granted only if in the\njudgment of the superintendent such service by the executive officer\nwill be consistent with the policy of the state of New York as declared\nin section ten of this chapter. The superintendent shall have the power\nto revoke such permission whenever the superintendent finds, after\nreasonable notice and an opportunity to be heard, that the public\ninterest requires such revocation.\n (c) For the purposes of this subdivision, the term "bank holding\ncompany" shall be given the same meaning as is contained in section one\nhundred forty-one of this chapter, and the definition of the term\n"banking institution" is modified to include a national bank, federal\nsavings bank or federal savings association, the principal office of\nwhich institution is located in this state, and a foreign banking\ncorporation maintaining a branch in this state.\n (d) All other restrictions and limitations imposed by this chapter on\nexecutive officers and directors of savings and loan associations shall\ncontinue in effect.\n