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Electronic Code of Federal Regulations

e-CFR data is current as of January 22, 2020

Amendment


12 CFR--PART 701

View Printed Federal Register page 84 FR 58309 in PDF format.

Amendment(s) published October 31, 2019, in 84 FR 58309

Effective Dates: Jan. 29, 2020

2. In §701.32, revise paragraph (b) to read as follows:

§701.32   Payment on shares by public units and nonmembers.

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(b) Limitations—(1) Aggregate limit on public unit and nonmember shares. Except as permitted under paragraph (c) of this section, a federal credit union may not receive public unit and nonmember shares in excess of the greater of:

(i) 50 percent of the net amount of paid-in and unimpaired capital and surplus less any public unit and nonmember shares, as measured at the time of acceptance of each public unit or nonmember share (i.e.,

eCFR graphic er31oc19.019.gif

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(ii) $3 million.

(2) Required due diligence. Before receiving public unit or nonmember shares that, taken together with any borrowings, exceed 70 percent of paid-in and unimpaired capital and surplus, the board of directors must adopt a specific written plan concerning the intended use of these funds that is consistent with prudent risk management principles.

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