§ 17-11-106 — Membership generally; loans to corporation

(a) Any financial institution may request membership in
the corporation by making application to the board of directors
on such form and in such manner as said board of directors may
require, and membership shall become effective upon acceptance
of such application by the board.
(b) Each member of the corporation shall make loans to the
corporation as and when called upon by it to do so on such terms
and other conditions as shall be approved from time to time by
the board of directors, subject to the following conditions:
(i) All loan limits shall be established at the
thousand dollar amount nearest to the amount computed in
accordance with the provisions of this section;
(ii) Repealed by Laws 1988, ch. 84, § 2.
(iii) The total amount outstanding on loans to the
corporation made by any member at any one (1) time, when added
to the amount of the investment in the capital stock of the
corporation then held by such member, shall not exceed:
(A) Twenty percent (20%) of the total amount
then outstanding on loans to the corporation by all members,
including in said total amount outstanding amounts validly
called for loan but not yet loaned;
(B) The following limit, to be determined as of
the time such member becomes a member on the basis of the
audited balance sheet of such member at the close of its fiscal
year immediately preceding its application for membership, or in
the case of an insurance company, its last annual statement to
the state insurance commissioner: two and one-half percent (2
1/2%) of the capital and surplus of commercial banks and trust
companies; one-half of one percent (1/2%) of the total
outstanding loans made by savings and loan associations, and
building and loan associations; two and one-half percent (2
1/2%) of the capital and unassigned surplus of stock insurance
companies, except fire insurance companies; two and one-half
percent (2 1/2%) of the unassigned surplus of mutual insurance
companies, except fire insurance companies; one-tenth of one
percent (1/10%) of the assets of fire insurance companies; and
such limits as may be approved by the board of directors of the
corporation for other financial institutions. The board of
directors may, on the request of any financial institution
applying for membership, and with the approval of two-thirds
(2/3%) of the members of the same class as the financial
institution making the request, authorize a different loan limit
for such financial institution than is set forth above.
(iv) Each call 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 the member's loan limit, reduced by the balance of
outstanding loans made by the member to the corporation, the
investment in capital stock of the corporation held by the
member and the amount of any contribution made by the member to
the corporation, at the time of the call. No member shall be
subject to a call as a result of owning stock in the
corporation. Calls shall be made only on members who have made
member loans to the corporation;
(v) All loans to the corporation by members under
this section shall be evidenced by bonds, debentures, notes, or
other evidence of indebtedness of the corporation, which shall
be freely negotiable at all times, and which shall bear interest
at a rate of not less than one-quarter of one percent (1/4%).