Chapter 1151: SAVINGS AND LOAN ASSOCIATIONS - GENERALLY

1151.01 Savings and loan associations - general definitions.

In sections of the Revised Code making reference to savings and loan associations and to the division of savings and loan associations or the division of financial institutions:

(A) "Savings and loan association" means a corporation organized for the purpose of raising money to be loaned to its members or to others; "building and loan association" and "savings association" may be used interchangeably with and shall for all purposes have the same meaning as "savings and loan association"; and "division of building and loan associations" and "division of savings and loan associations" may be used interchangeably with and shall for all purposes have the same meaning as "division of financial institutions."

(B) "Controlling person" means any person or entity which, either directly or indirectly, or acting in concert with one or more other persons or entities, owns, controls, or holds with power to vote, or holds proxies representing, fifteen per cent or more of the voting shares or rights of a savings and loan association or controls in any manner the election or appointment of a majority of the directors of an association. However, a director of an association will not be deemed to be a controlling person of such association based upon the director's voting, or acting in concert with other directors in voting, proxies obtained in connection with a solicitation of proxies or obtained from savings account holders and borrowers if such proxies are voted as directed by a majority of the entire board of directors of the association, or of a committee of such directors if such committee's composition and authority are controlled by a majority vote of the entire board and if its authority is revocable by such a majority.

(C) "Domestic association" means a savings and loan association organized under the laws of this state or a savings association chartered under the laws of the United States, the home office of which is located within this state.

(D) "Foreign savings association" means a savings and loan association that is chartered under the laws of another state.

(E) "Foreign federal association" means a savings association chartered under the laws of the United States, the home office of which is located in another state.

(F) "Another state" means any state of the United States other than this state, and includes the District of Columbia and any other territory, insular possession, or political subdivision of the United States.

(G) "Banking office" means an office or other place at which a savings association receives money or its equivalent from the public for deposit and conducts the general business of a savings association. "Banking office" does not include any of the following:

(1) Any location at which a savings association receives, but does not accept, cash or other items for subsequent deposit, such as by mail or armored car service or at a lock box or night depository;

(2) Any structure located within five hundred yards of a banking office and operated as an extension of the services of the banking office;

(3) Any remote service unit or automated teller machine owned, leased, or operated by a savings association;

(4) Any facility located within the geographical limits of a military installation at which a savings association only accepts deposits and cashes checks;

(5) Any location at which a savings association takes and processes applications for loans and from which it may disburse loan proceeds, but does not accept deposits;

(6) Any location at which a savings association is engaged solely in providing administrative support services for its own operations or for other financial institutions.

(H) "Branch" means a banking office that is not also the savings association's principal office consistent with its articles of incorporation.

(I) "Superintendent," "superintendent of building and loan associations," or "superintendent of savings and loan associations" means the superintendent of the division of financial institutions of this state. Whenever the division or superintendent of savings and loan associations or building and loan associations is referred to or designated in any statute, rule, contract, or other document, the reference or designation shall be deemed to refer to the division or superintendent of financial institutions, as the case may be.

(J) "Savings bank" means a savings bank doing business under authority granted by the superintendent pursuant to Chapter 1161. of the Revised Code or under the regulatory authority of another state.

(K) "Bank" has the same meaning as in section 1101.01 of the Revised Code.

Effective Date: 05-21-1997

1151.02 Incorporation.

A savings and loan association shall be organized, governed, and conducted under the general laws of this state relating to corporations, except as otherwise provided in Chapters 1151., 1153., 1155., and 1157. of the Revised Code. Upon receipt of articles of incorporation, and all papers relating thereto, for such an association, the secretary of state shall forthwith transmit to the superintendent of savings and loan associations a copy of such articles and shall not record them until authorized to do so by the superintendent.

Effective Date: 07-14-1987

1151.03 Examination and certification by superintendent.

Upon receipt from the secretary of state of a copy of the articles of incorporation of a proposed building and loan association, the superintendent of building and loan associations shall immediately examine into all the facts connected with the formation of such proposed corporation, including its location and proposed incorporators, and if it appears that such corporation, if formed, will be entitled to commence the business for which it is organized, the superintendent shall so certify to the secretary of state, who shall thereupon record such articles.

The superintendent may refuse so to certify to the secretary of state, if upon such examination he has reason to believe that the proposed corporation is to be formed for any business other than legitimate building and loan business, that the character and general fitness of the persons proposed as incorporators in such corporation are not such as to command the confidence of the community in which such corporation is proposed to be located, that the public convenience and advantage will not be promoted by its establishment, or that the name of the proposed corporation is likely to mislead the public as to its character or purpose; or if the proposed name is the same as one already appropriated by any existing building and loan association in this state or so similar thereto as to be likely to mislead the public, unless the place of business of such proposed corporation is to be located in a county other than the one in which such corporation bearing such same or similar name is then doing business.

Effective Date: 10-01-1953

1151.04 Recording of articles of incorporation by secretary of state.

Upon receipt of the certificate provided for in section 1151.03 of the Revised Code from the superintendent of building and loan associations, the secretary of state shall record the association's articles of incorporation and shall thereupon furnish one copy thereof, certified by him, to the incorporators, and one copy to the superintendent to be filed by him in his office. All certificates thereafter filed in the office of the secretary of state relating to such corporation shall be recorded, and a certified copy thereof shall be forthwith furnished to the superintendent and filed in his office.

Effective Date: 10-01-1953

1151.05 Superintendent's approval required to establish, maintain or relocate branch - permissible locations.

(A) No savings and loan association organized under the laws of this state shall establish more than one banking office, or maintain branches other than those established before July 3, 1923, nor relocate any branch, except with the prior written approval of the superintendent of financial institutions.

(B) A savings and loan association organized under the laws of this state may establish a branch at any of the following locations:

(1) Any location in this state;

(2) Any location in another state;

(3) Any location outside the United States.

(C) The superintendent may condition approval of a branch at a location in another state or outside the United States on an agreement satisfactory to the superintendent that provides for the frequency and method of, and the reimbursement of expenses for, examining the branch.

Effective Date: 05-21-1997

1151.051 Temporary quarters - advance notice to superintendent.

Any building and loan association which conducts the business of an office or branch at temporary quarters during construction or alteration of its regular quarters shall give advance written notice to the superintendent of building and loan associations of the place and estimated time of such arrangement and shall give prompt written notice to the superintendent of the actual time of return to the regular quarters. No such association shall continue such arrangement for longer than two years, nor at a location more than one half mile from the regular quarters, without the prior written approval of the superintendent.

Effective Date: 12-11-1967

1151.052 Foreign federal association branches.

(A) Except as otherwise provided in this section and in section 1151.60 of the Revised Code, only a domestic association may establish and maintain a branch in this state.

(B) A foreign federal association may establish a branch as permitted by federal law.

(C)

(1) A foreign savings association may, upon receiving the approval of the superintendent of financial institutions, establish a branch in this state by creating a new branch or by agreeing to assume all or substantially all of the deposit liabilities of an existing branch of a bank, savings bank, domestic association, foreign savings association, foreign federal association, or savings and loan association, which branch is located in this state. The superintendent shall not grant approval unless both of the following conditions are met:

(a) The foreign savings association provides evidence to the superintendent that its accounts are insured by the federal deposit insurance corporation.

(b) The superintendent determines, in the superintendent's discretion, that the laws of the state in which the foreign savings association has its home office, which laws are in effect at the time the association is seeking approval under this section, permit a savings and loan association organized under this chapter to establish a new branch or assume all or substantially all of the deposit liabilities of an existing branch of a bank, savings bank, domestic association, foreign savings association, foreign federal association, or savings and loan association, as the case may be, in that other state on terms that are, on the whole, substantially no more restrictive than those established under this section.

(2) If a foreign savings association that maintains a branch in this state withdraws from the federal deposit insurance corporation, its authority to maintain a branch in this state is terminated.

(3) A foreign savings association that seeks to establish additional branches in this state or to relocate branches in this state is subject to divisions (C)(1) and (2) of this section and section 1151.05 of the Revised Code.

Effective Date: 05-21-1997

1151.053 Providing services to another financial institution's customers.

(A) With the written approval of the superintendent of savings and loan associations, a savings and loan association may contract with one or more other savings and loan associations, banks, and savings banks to provide services to the contracting savings and loan association's customers at any or all of the offices of the other savings and loan associations, banks, and savings banks as if the offices of the other savings and loan associations, banks, and savings banks were offices of the contracting savings and loan association.

(B) The superintendent shall approve or disapprove a savings and loan association's request for approval of a contract authorized by division (A) of this section within thirty days after accepting a savings and loan association's application for the superintendent's approval of the contract.

(C) In determining whether to approve or disapprove a contract authorized by division (A) of this section, the superintendent shall consider all of the following:

(1) The adequacy of the management of the contracting savings and loan association and the other savings and loan associations, banks, and savings banks;

(2) The adequacy of the capital and stated capital of the contracting savings and loan association and the other savings and loan associations, banks, and savings banks;

(3) The adequacy of the operations and controls of the contracting savings and loan association and the other savings and loan associations, banks, and savings banks;

(4) Whether the contract is being used to avoid application of the criteria for establishing a branch under section 1151.05 of the Revised Code or any kind of business combination under section 1151.60 of the Revised Code.

(D) This section does not authorize a contracting savings and loan association to establish new deposit accounts, extend credit, or create new business relationships through offices of the other savings and loan associations, banks, and savings banks.

Effective Date: 10-01-1996

1151.06 Articles void for failure to begin business within one year.

A building and loan association which fails to commence business within one year from the date of the issuance of its articles of incorporation shall cease to exist, and its articles of incorporation shall be void.

Effective Date: 10-01-1953

1151.07 Utilization of words suggesting that person or entity is engaged in savings and loan association business.

(A) A savings and loan association, savings bank, or bank may use in its name, with other words not forbidden by law, any of the following words or combinations of words: "savings," "building," "loan," "savings and loan," "building and loan, "bank," "banker," or "banking."

(B) Except as provided in division (A) of this section, no person, firm, company, association, fiduciary, partnership, or corporation, either domestic or foreign, unless the person or entity is lawfully authorized to do business in this state under the provisions of this chapter and actually is engaged in carrying on a savings and loan association business or making loans as authorized under section 1151.296 of the Revised Code, shall do business under any name or title that contains the terms "savings association," "savings and loan association," "building and loan association," "building association," or any combination employing either or both of the words "building" or "loan" with the words "saving" or "savings," or words of similar import, or use any name or sign or circulate or use any letterhead, billhead, circular or paper whatever, or advertise or represent in any manner that indicates that the person's or entity's business is the character or kind of business carried on or transacted by a savings and loan association or that leads any person to believe that the person's or entity's business is that of a savings and loan association. Upon application by the superintendent of financial institutions or any savings and loan association, a court of competent jurisdiction may issue an injunction to restrain any such entity from violating or continuing to violate any of the provisions of this division. The prohibitions of this division shall not apply to any corporation or association formed for the purpose of promoting the interests of savings and loan associations, the membership of which is comprised of thrift institutions or their officers or other representatives.

Effective Date: 09-29-1999

1151.08 Capital and other requirements for commencement of business.

(A) When capital stock is mentioned in the articles of incorporation of a savings and loan association, it shall mean the authorized capital. The organization of the association may be completed and business commenced when a sum equal to five per cent of such authorized capital is subscribed and paid in and the names and addresses of its officers and not less than two copies of its constitution and bylaws have been filed with and approved by the superintendent of savings and loan associations. No such corporation shall transact any business, except such as is incidental and necessary to its preliminary organization, until it has been authorized by the superintendent to do so. No amendment to such constitution or bylaws shall become effective until approved by the superintendent. The authorized capital of such corporation shall be not less than two million dollars nor more than ten million dollars, as the superintendent of savings and loan associations may determine. In addition, the superintendent of savings and loan associations may, in his discretion, fix the amount of reserve funds to be established by the sale of the stock at a premium and the amount of the expense fund for operating losses to be created by nonrefundable contributions. Five years after the association commences business, any remaining balance in such expense fund shall be transferred to the reserve funds, if the association is on a profitable operating basis as determined by the superintendent.

(B) The stock sold by any savings and loan association shall be accounted for to the association in the full amount paid for it. No commission or fee shall be paid for selling such stock. The superintendent shall refuse authority to commence business to any savings and loan association if commissions, contributions, or fees have been paid or contracted to be paid, directly or indirectly, by anyone, for selling or securing subscriptions for stock in such savings and loan association.

(C) Division (B) of this section does not apply to any sale of stock by an association after authority has been given to such association to commence business under section 1151.09 of the Revised Code or after it has converted from a bank or a savings bank pursuant to section 1151.64 of the Revised Code.

Effective Date: 10-23-1991

1151.081 Converting building and loan association to mutual deposit building and loan association.

(A) A building and loan association organized under this chapter may convert itself into a building and loan association without stock, the capital of which is in the form of savings deposits, by amendment of its articles of incorporation and constitution in the manner set forth in the second paragraph of section 1151.46 of the Revised Code. Upon conversion such association shall be subject to the limitations of this section and section 1151.23 of the Revised Code.

(B) A depositor of such association shall be a voting member and joint owner of the association upon such terms and conditions as the articles of incorporation, constitution, and bylaws of the association provide.

(C) The capital of such association shall be in the form of savings deposits and shall be maintained at a level equal to the amount which would be applicable if the association had not converted itself into an association without stock.

(D) Upon conversion, the holders of shares, stock, or stock credits shall become depositors of such association without further action by them and they shall have all the rights of depositors as set forth in this section. The amount of such savings deposits shall be a sum equal to the value of the shares, stock, or stock credits as shown on the books and records of the association.

(E) In the event of a voluntary or involuntary liquidation, dissolution, or winding up of the association or in the event of any other situation in which the priority of the savings deposits of such association is in controversy, all such savings deposits shall, to the extent of their withdrawal value, be debts of the association not having priority, other than any priority arising or resulting from consensual subordination, over other general creditors of the association and in addition, such savings deposits shall have the same right to share in the remaining assets of the association that they would have if they were shares, stock, or stock credits.

(F) The conversion provided for in this section is not subject to section 1151.61 of the Revised Code.

(G) Whenever "share," "stock," or "stock credit" appear in Chapters 1151., 1153., 1155., or 1157. of the Revised Code or in any other section of the Revised Code referred to directly or incorporated by reference in such chapters, unless the context otherwise requires they mean savings deposits in respect of any association without stock; whenever "shareholder" appears in such chapters or sections, unless the context otherwise requires it means depositor in respect of such associations, and whenever "dividend" appears in such chapters or sections, unless the context otherwise requires it means interest in respect of such associations.

Effective Date: 11-17-1969

1151.09 Certificate of authority to commence business.

When a certificate, signed by the president, secretary, or treasurer of an incorporated savings and loan association, is transmitted to the superintendent of savings and loan associations notifying him that the required amount of capital stock of such corporation is subscribed and paid in and that such corporation has complied with all the provisions of law required to be done before it can be authorized to commence business, the superintendent shall examine into its affairs and ascertain especially the amount of money paid in on account of its capital, the name and place of residence of each director, the amount of capital stock paid in of which each director is the owner in good faith, and whether such corporation has complied with all the provisions of law required to entitle it to engage in business. If upon such examination of these and any other facts which may come to his knowledge, the superintendent finds that such corporation is entitled to commence business, he shall give it a certificate under his hand and official seal that it has complied with all the requirements of law and is authorized to commence business. The superintendent shall not issue the certificate or certify to the secretary of state that the corporation is entitled to commence business if upon such examination the superintendent has reason to believe that the accounts of the association will not be insured by the federal savings and loan insurance corporation upon the commencement of business.

Effective Date: 07-14-1987

1151.091 Interim savings and loan association.

Notwithstanding the definition of "savings and loan association" set forth in division (A) of section 1151.01 of the Revised Code, the superintendent of savings and loan associations may authorize the secretary of state to record articles of incorporation of an interim savings and loan association organized under this chapter to facilitate a merger, consolidation, or acquisition of an existing association, or to facilitate any other transaction the superintendent may approve. In connection therewith, the superintendent may waive the minimum authorized capital requirements of section 1151.08 of the Revised Code and the statutory reserve and net worth requirements established pursuant to section 1151.33 of the Revised Code, and he may deviate from the provisions relating to the consideration of applications to organize an association as set forth in this chapter. In the event that the merger, consolidation, or acquisition or such other transaction as the superintendent may approve does not occur within a one-year period after the date upon which such interim savings and loan association is incorporated, its articles of incorporation shall be declared void by the superintendent. Such one-year period may not be extended.

Effective Date: 07-14-1987

1151.10 Stock records - list of shareholders exhibited.

Every building and loan association shall keep books and records in which shall be entered the name and the last known address of each stockholder; the number of shares, fractions of shares, or stock deposits held by each; the time each person became a stockholder; and all transfers of stock, stating the time when made, the number of shares or of stock deposits transferred, and by whom they were transferred. A list of shareholders shall be exhibited by the association to shareholders or their duly authorized representative as the constitution or bylaws of the association may provide.

Effective Date: 08-09-1963

1151.11 Notice of meeting of shareholders.

Whenever shareholders of a building and loan association are required or authorized to elect directors or to take any other action at a meeting, either annual or special, a notice of the meeting shall be given either by publication, once each week on the same day of the week for three consecutive weeks immediately preceding the date of the meeting, in a newspaper published in and of general circulation in the county in which the principal office of the association is located, of notice containing the name of the association and the purpose, place, date, and hour of the meeting, or by notice served upon or mailed to shareholders as provided in section 1701.41 of the Revised Code.

Effective Date: 10-07-1977

1151.12 Terms of office of directors.

Directors of a building and loan association may be elected for any term not less than one nor longer than three years. If such term is longer than one year, it shall be so arranged that, as nearly as possible, the terms of an equal number of directors will expire each year.

Effective Date: 10-01-1953

1151.13 Quorum of board of directors.

A majority of all authorized directors of a building and loan association is necessary to constitute a quorum for the transaction of business by its board of directors. Except as otherwise provided by law or in the constitution or bylaws of the association, the acts of a majority of the directors who are present, at a meeting at which a quorum is present, are the acts of the board.

Effective Date: 08-09-1963

1151.14 Meetings of board of directors - committees.

(A)

(1) A savings and loan association's board of directors shall meet monthly unless the savings and loan association's constitution provides for a different frequency of meetings, which shall not be less than quarterly.

(2) Division (A)(1) of this section does not prohibit either of the following:

(a) More frequent meetings of a savings and loan association's board of directors than required by division (A)(1) of this section;

(b) The superintendent of financial institutions requiring a savings and loan association's board of directors to meet more frequently than required by division (A)(1) of this section if the superintendent determines more frequent meetings are appropriate because of circumstances regarding the savings and loan association.

(B) A savings and loan association's constitution may authorize the board of directors to do both of the following:

(1) Create an executive committee or any other committee of the board of directors, each consisting of at least three directors;

(2) Delegate to an executive committee or other committee of the board of directors described in division (B)(1) of this section, any authority of the board of directors, however conferred, other than the authority to fill vacancies on the board of directors or to fill vacancies on a committee of the board of directors.

(C) All of the following apply to any executive committee or other committee described in division (B) of this section:

(1) The board of directors may appoint one or more of the directors as alternate members of a committee of the board of directors to take the place of any absent member at any meeting of the committee of the board of directors.

(2) Each committee of the board of directors serves at the pleasure of the board of directors, acts only in intervals between meetings of the board of directors, and is subject to the control and direction of the board of directors.

(3) Unless otherwise provided in the constitution or ordered by the board of directors, a committee of the board of directors may act by a majority of its members at a meeting or by a writing or writings signed by all of its members.

(4) An act or authorization of an act by a committee of the board of directors that is within the authority delegated to the committee is as effective for all purposes as an act or authorization of an act done by the board of directors.

Effective Date: 03-24-1993; 04-06-2007

1151.15 Compensation of directors and officers.

(A) The compensation of the directors of a savings and loan association shall be fixed by the stockholders, or, in the case of an association without permanent stock, by the members, at the annual meeting. The compensation of directors shall be reasonable in view of the services performed and the financial condition of the association. A director may also be a salaried officer of the association, but a majority of the directors shall not be salaried officers of the association.

(B) The directors of an association shall set the compensation of the chief executive officer of the association. The compensation of all officers of the association shall be reasonable in view of the services performed and the financial condition of the association.

(C) The superintendent of savings and loan associations may, in accordance with Chapter 119. of the Revised Code, adopt rules regarding the composition of the board of directors of an association.

Effective Date: 07-14-1987

1151.151 [Repealed].

Effective Date: 07-14-1987

1151.16 Directors, officers, and employees shall not receive fees.

No director, officer, employee, or attorney of a building and loan association shall knowingly, directly or indirectly, stipulate for, assent to receive, or receive any money or other thing of value as a fee, commission, or gift from any person or corporation other than the association making the loan, for procuring, endeavoring to procure, or performing any service, except reasonable attorneys' fees and appraisal fees for services, in connection with any loan from or investment by such association. Whoever violates this section shall be disqualified from acting as a director, officer, employee, or attorney of any association within this state for five years after the date he is convicted of such violation.

Effective Date: 09-01-1961

1151.17 Oaths required of directors and officers.

Each director, officer, and member of an appraisal committee of a building and loan association shall, when appointed or elected, take an oath that he will, so far as the duty devolves upon him, diligently and honestly administer the affairs of the association, and will not knowingly violate, or willingly permit to be violated, any law applicable to such association. Such oath shall be subscribed by the person making it, and certified by an officer authorized to administer oaths. A copy shall be filed in the records of the association.

Effective Date: 10-01-1953

1151.18 Removal of director or officer by superintendent.

(A) Every director and officer of a savings and loan association is subject to removal by the superintendent of savings and loan associations on any of the following grounds:

(1) Knowingly participating in or consenting to a violation of Chapter 1151., 1153., 1155., or 1157. of the Revised Code, regardless of whether such participation or consent is defined or interpreted in a guideline issued pursuant to section 1155.35 of the Revised Code;

(2) Knowingly participating in or consenting to any unsafe or unsound practice in conducting the business of the association, regardless of whether such practice is defined or interpreted in a guideline issued pursuant to section 1155.35 of the Revised Code;

(3) Failure to properly perform his obligations under, or failure to comply with a final or summary cease-and-desist order issued under division (A) or (B) of section 1155.02 of the Revised Code, or failure to pay a civil penalty assessed under division (B) of section 1155.17 of the Revised Code.

Such removal shall occur after a hearing, written notice of which, together with a statement of charges, has been sent by registered mail ten days in advance to such director or officer. Pending an investigation by and a hearing before the superintendent, such director or officer shall not act for the association; but such hearing shall be held not later than fifteen days after such notice has been sent by the superintendent, and it shall comply with section 119.09 of the Revised Code.

(B) Whenever the superintendent issues a removal order, the aggrieved party may, within thirty days after notice of his removal, file in the court of common pleas of Franklin county, or of the county wherein the association in question has its principal place of business, a petition against the superintendent officially, as defendant, alleging the facts upon which he relies for a reversal of the action of the superintendent complained of and praying for a reversal thereof. Immediately upon filing such petition, summons shall be issued to the sheriff of Franklin county to be served on the superintendent, returnable within five days from its date, which in all other respects such summons shall be made as in civil actions, whereupon the allegations of the petition shall be deemed to stand denied without pleading and the cause shall be advanced and heard without delay.

(C) Except as otherwise provided in this division, any person who is removed from the board of directors of an association by the superintendent under division (A) of this section, and who either does not appeal his removal or whose removal is upheld upon appeal, is forever disqualified from serving as a director of any association. If, however, the superintendent, upon written application of the person removed, and pursuant to an adjudication conducted in accordance with Chapter 119. of the Revised Code, finds a compelling reason for removing the disqualification of this division, he may issue an adjudication order removing the disqualification and declaring the person again eligible to serve as a director of an association.

(D) The superintendent may send notice of a removal order to any state or federal government agencies he considers appropriate.

Effective Date: 07-14-1987

1151.19 Receiving of deposits.

(A) A building and loan association may receive money on deposit or stock deposits from any persons, firms, corporations, and courts, or their agents, officers, and appointees and may pay interest thereon. When such deposits are made to the joint account of two or more persons, whether adults or minors, with a joint order to the association that such deposits or any part thereof are to be payable on the order of any of such joint depositors, and to continue to be so payable notwithstanding the death or incapacity of one or more of the persons making them, such account shall be payable to any of such survivors or order notwithstanding such death or incapacity. No recovery shall be had against such association for amounts so paid and charged to such account. An association may charge fees in connection with the administration of accounts and deposits established under this chapter.

A building and loan association may receive deposits of moneys of the state or any subdivision thereof as defined in section 135.01 of the Revised Code.

Subject to regulation of the United States treasury department, a savings and loan association may act as a depository for federal taxes and as a treasury tax and loan depository. An association may permit such accounts to be subject to immediate withdrawal.

(B) In addition to the custodian power authorized by division (A) of this section, an association may specifically serve as custodian for any fund which qualifies, at the time the association becomes custodian, for tax treatment under section 408 of the Internal Revenue Code.

Effective Date: 09-03-1984

1151.191 Building and loan association may serve as trustee.

(A) A building and loan association may serve as trustee of any trust which qualifies, at the time the association becomes trustee, for tax treatment under section 401 or 408 of the Internal Revenue Code. The association may invest the funds of any such trust in savings accounts or deposits of a domestic building and loan association or in equity or debt securities issued by a domestic building and loan association.

(B) Whenever any deposit or stock deposit is made in a building and loan association by any person in trust for another and no further notice of the existence and terms of a legal and valid trust is given in writing to such association, such deposit or stock deposit or any part thereof together with the dividends or interest thereon may in the event of the death of the trustee be paid to the person for whom the deposit or stock deposit was made.

(C) Any funds held in trust as authorized by division (A) or (B) of this section may be commingled by the trustee association in one or more accounts. Whenever individual trust funds are commingled, separate records shall be maintained by the trustee association for each trust account comprising the commingled fund.

(D) Exercise of the limited trust power granted associations by this section shall not be subject to regulation other than by the superintendent of building and loan associations pursuant to Chapters 1151., 1153., 1155., and 1157. of the Revised Code.

Effective Date: 04-13-1976; 01-01-2007

1151.192 Recognizing adverse claims.

(A) A building and loan association shall not be required, in the absence of a court order or indemnity required by this section, to recognize any claim to, or any claim of authority to exercise control over, a deposit account, stock deposit account, safe deposit box, or property held in safekeeping by such association made by a person or persons other than:

(1) The person in whose name the deposit account, stock deposit account, property, or safe deposit box is held by the association, or;

(2) An individual or group of individuals who are authorized to draw upon or control the deposit account, stock deposit account, property, or safe deposit box pursuant to a certified resolution of a corporation or unincorporated association, currently on file with the association which has not been revoked to the actual knowledge of the association and is not the subject of a dispute actually known to the association as to its original validity.

(B) To require an association to recognize an adverse claim to, or adverse claim of authority to control, a deposit account, stock deposit account, safe deposit box, or property held in safekeeping, whoever makes the claim must either:

(1) Obtain and serve on the association a certified copy of an appropriate order by a court having jurisdiction restraining any action with respect to the deposit account, stock deposit account, safe deposit box, or other property until further order of such court, or instructing the association to pay the balance of the deposit account or stock deposit account, or deliver the property, in whole or in part, as provided in such order, or;

(2) To deliver to the association a bond, in form and in amount and with sureties satisfactory to the association, indemnifying the association against any liability, loss or expense which it might incur because of its recognition of the adverse claim or because of its refusal by reason of such claim to honor any application for withdrawal, or to deliver any property to or permit access to a safe deposit box by anyone described in division (A)(1) or (A)(2) of this section.

Effective Date: 12-13-1967

1151.20 Issuance of stock, capital notes, and debentures.

A building and loan association may issue stock to members, upon certificates or upon written subscription, on such terms consistent with sections 1151.02 to 1151.55 , inclusive, of the Revised Code, as its constitution and bylaws provide, but no initiation or membership fee shall be charged, and if the stock is sold at a premium, all such premiums shall be placed in the reserve fund of the association. All amounts, except fines and premiums, paid in by a member as such on any one account, together with all credits on such account, shall be considered payments on a stock subscription, and the aggregate of such payments and credits, less any charges to such account, shall constitute a stock credit of such member for the purpose of such sections. Each member may vote his stock to the extent and in the manner provided by the constitution of the association, but no member shall accumulate his votes. This section does not prohibit the issuance of permanent stock.

A building and loan association may issue capital notes or debentures at such times, in such amounts, and subject to such terms as the superintendent of building and loan associations in writing approves, but in no event shall such terms require or permit that the holders of such capital notes or debentures be held individually responsible as such holders for any debts, contracts, or engagements of the association.

Effective Date: 08-09-1963

1151.201 Building and loan association may purchase its own shares of permanent stock.

A building and loan association may purchase its own shares of permanent stock, if the purchase is not inconsistent with its articles, constitution, or bylaws.

Effective Date: 09-29-1999

1151.21 Assessments.

A building and loan association may assess and collect from members and others, such dues, fines, interest and premium on loans made, or other assessments as are provided for in its constitution and bylaws. Such assessments shall not be deemed usury, although in excess of the legal rate of interest.

Effective Date: 10-01-1953

1151.22 Repurchase of stock credits.

A building and loan association may permit its members to have their stock credits repurchased by the association in part or in full, at any time, and require them to file applications for such repurchase. Upon the receipt of such applications, the association shall number and file them in the order received and shall, within thirty days from the receipt of an application, either pay the applicant the amount of his stock credits as requested, in the order in which his application was filed, or apply at least one third of the cash receipts of the association received thereafter, after making proper provision for the payment of interest on deposits, dividends paid on stock and stock deposits, borrowed money, and taxes, from all sources except borrowed money, the proceeds from the sale of assets, and the proceeds derived from foreclosure proceedings where the association is the purchaser, to the retirement of such applications in numerical order. The board of directors may pay out of said one third of said cash receipts or out of any other funds in respect of any such application, not more than one hundred dollars of any one stock account in any one month in any order. If any stockholder applies for the repurchase of more than one thousand dollars of any stock credits, he shall not be paid more than one thousand dollars in order when reached, subject to the foregoing provisions of this section, and his application shall be charged with such amount, renumbered, and placed at the end of the list of applications for repurchase. Thereafter, upon again being reached in order, he shall again be paid a like amount of the remaining amount of his stock account, whichever is less; and until his stock account is paid in full it shall continue to be so paid, charged, renumbered, and replaced at the end of the list. Stockholders whose stock accounts are repurchased in part or in full shall, upon such repurchase, be relieved of all liability with reference to such stock accounts. Stockholders filing written application for the repurchase of their stock credits shall remain stockholders until paid for such stock credits, and shall not become creditors. Dividends upon the stock credit of any stockholder, to the extent of the amount of his application to repurchase, shall be discontinued while such application remains upon a list for the repurchase of stock credits; but dividends that would otherwise be paid upon such stock credits shall not be discontinued, notwithstanding the application for repurchase, if said application is withdrawn in consideration of the restoration of said dividends. The repurchase value of the stock credit so requested to be repurchased shall be the amount of such stock credit as defined by section 1151.20 of the Revised Code. If the stock credit proposed to be repurchased is pledged with the association as collateral security for the payment of a loan, the amount of such loan, plus all interest and charges thereon, shall be deducted from the repurchase value before any amount is paid to the member. No repurchase notice, on account of any stock credits which have been transferred on the books of the association within a period of sixty days preceding the date of such notice, shall be deemed received or valid.

Each repurchase of stock credits from a share account shall be governed by this section except to the extent that a shareholder's account book or other written evidence of the member's share account contains additional requirements relating to an application for repurchase.

Whenever the association is on notice, it may refuse to repurchase stock credits. An association having deposits greater than the aggregate amount of its stock credits, reserve, and undivided profits shall not repurchase stock credits so long as it has on file unsatisfied applications for the withdrawal of deposits.

Effective Date: 10-14-1969

1151.23 Withdrawal of deposits.

(A) A savings and loan association may permit withdrawal of deposits upon such terms as it provides.

(B) A savings and loan association may permit withdrawals by negotiable order of withdrawal as authorized in the "Consumer Checking Account Equity Act of 1980," 94 Stat. 146, 12 U.S.C. 1832(a) , and any amendments or regulations promulgated pursuant thereto. An association may extend secured or unsecured credit in the form of overdraft privileges related to deposits subject to withdrawal under divisions (A) and (B) of this section.

Effective Date: 09-03-1984

1151.231 Permitting withdrawal of deposits through another domestic association or foreign association.

Without prejudice to the generality of the powers conferred by section 1151.23 of the Revised Code, a building and loan association may permit withdrawal of deposits through another domestic association or a foreign association, provided such foreign association's accounts are insured by the federal savings and loan insurance corporation, and such domestic or foreign association is located more than fifty miles from the residence of the account holder.

Effective Date: 08-29-1978

1151.24 Transfer of credit.

A borrower from a building and loan association may tender, in discharge of any of his obligations to the association, credit to a deposit account standing in his name on the books of the association, regardless of when such credit was created or transferred to the name of such borrower, and the association shall accept such tender at the full face value of such credit in discharge of such obligations; but for each dollar of such credit so tendered, the borrower shall, if required by the association, pay one dollar in cash.

No such association shall refuse to transfer such a credit, or a portion of such a credit, on its books unless the association has a valid lien on such credit, or a valid right of appropriation thereof, or unless the transferee is not the owner of the credit sought to be transferred.

Effective Date: 10-01-1953

1151.25 Cancellation of shares.

A building and loan association may cancel shares and parts of shares of stock upon which the credits have been repurchased by it, or upon which loans have been repaid, and reissue them as new stock.

Effective Date: 10-01-1953

1151.26 Dealings with minors.

A building and loan association may issue stock to minors; receive deposits thereon; permit both stock and deposits to be withdrawn, transferred, pledged, and voted by such minors in the same manner as other stock and stock deposits; and receive deposits of money by or for minors and pay them to such minors or upon their order. The receipt or paid order of such minor therefor shall be an acquittance of the rights of all concerned.

Effective Date: 10-01-1953

1151.27 Investing in real estate.

(A) Without prejudice to the generality of the powers conferred by section 1151.47 of the Revised Code, a savings and loan association may invest in such real estate and interests therein as the board of directors considers necessary or convenient for the transaction of the business of the association, including the ownership of stock of a wholly owned subsidiary corporation having as its exclusive authority the ownership and management of such property or interests. The total amount so invested shall not exceed the amount of the association's net worth at the time the investment is made. An association may invest in such real estate in excess of the amount prescribed in this division with the written approval of the superintendent of savings and loan associations.

(B) An association may invest an amount equal to ten per cent of its assets in any other real estate. This limitation does not apply, however, to real estate acquired by foreclosure, conveyance in lieu of foreclosure, or other legal proceedings in relation to loan security interests.

(C) An association may own or hold any real estate which it acquires by foreclosure, conveyance in lieu of foreclosure, or other legal proceedings in relation to loan security interests, which it may hold for a period not in excess of five years; but the superintendent may, upon application of an association, grant to it in writing the power to hold such real estate for a longer period. Real estate sold on contract, but with title remaining in the name of the association, shall not be deemed real estate for the purpose of this division.

Effective Date: 12-13-1984

1151.28 Borrowing power.

(A) A savings and loan association may borrow money without limitation and may pledge and otherwise encumber any of its assets to secure its debts. All borrowings under this section shall comply with the applicable rules and regulations of the federal savings and loan insurance corporation regarding such borrowings and with rules adopted by the superintendent of savings and loan associations pursuant to Chapter 119. of the Revised Code.

(B) The superintendent shall establish, by rule adopted in accordance with Chapter 119. of the Revised Code, standards of safety and soundness regarding the following:

(1) Investments in securities under repurchase or reverse repurchase agreements;

(2) Investment limits for repurchase or reverse repurchase agreements with a single broker-dealer or similar entity;

(3) Collateralization requirements for reverse repurchase agreements or other similar instruments.

Effective Date: 07-14-1987

1151.29 Authority to loan.

A savings and loan association may make, invest in, sell, purchase, participate, or otherwise deal in loans to members and others on such terms as are provided by the association, subject to the provisions of this section and section 1151.292 of the Revised Code.

(A) Loans may be made upon the security of real estate which is improved residential property, a combination of residential and business property, or a farm under cultivation, as follows:

(1) The amount loaned upon any one such property shall not exceed ninety per cent of the appraised value, except as otherwise provided in divisions (A)(2) and (3) of this section.

(2) The maximum amount loaned upon any one such property shall be ninety-five per cent of the appraised value of the security property if all of the following criteria are met:

(a) The loan contract requires that, in addition to principal and interest payments on the loan, one-twelfth of the estimated annual taxes and assessments on the security property be paid monthly in advance;

(b) The borrower shall have executed a certificate stating that the borrower occupies or in good faith intends to occupy the property or one dwelling on the property as his principal residence.

(3) The maximum loan to value ratios under divisions (A)(1) and (2) of this section shall not be applicable if one or more of the following criteria apply:

(a) That portion of the loan in excess of ninety-five per cent is insured or guaranteed by a mortgage insurance company acceptable to the superintendent of savings and loan associations, or the association establishes and maintains a specific reserve of one per cent of the original principal balance until reduced to ninety per cent of the value of the security property;

(b) The loan is secured by a single-family dwelling or a one-family condominium unit and it is:

(i) Made under regulations for the housing opportunity allowance program authorized by the "Emergency Home Finance Act of 1970," 47 Stat. 736, 12 U.S.C. 1437 , and amendments thereto;

(ii) Insured or guaranteed by an agency or instrumentality of this state.

(4) For purposes of this section, "value" means market value. Loans made pursuant to divisions (A)(1), (2), and (3) of this section shall be payable in weekly, monthly, quarterly, semiannual, or annual installments sufficient to retire the loan within forty years or less. For purposes of this section, "installments" means regular periodic payments, equal or unequal, sufficient to retire the debt, interest and principal, within the contract period. Such contracts may be granted without provision for amortization or may provide for periods of negative amortization. Payments on all installment loans, except construction loans, shall begin not later than ninety days after the advance of the loan; on installment construction loans, such payments shall begin not later than thirty-six months after the date of the first advance for construction.

(B) Loans may be made on the security of building lots and sites which, by reason of off-site or other improvements as are available and common to the area, are ready for the construction on each such building lot or site of a structure designed primarily for residential use. Such loans shall comply with the following requirements:

(1) Single-family-dwelling loans for a borrower's principal residence, as evidenced by a borrower's certification of intention executed at the time the loan is made, shall not exceed seventy-five per cent of the value of the security property and shall be repayable within fifteen years, with interest payable at least semiannually. The loan contract shall provide for monthly payments sufficient to amortize at least thirty per cent of the original principal amount before the end of the loan term.

(2) Loans other than for a borrower's principal residence shall not exceed seventy-five per cent of the value of the security property and shall be repayable within five years, with interest payable at least semiannually beginning not more than one year after the initial disbursement.

(C) Loans may be made on the security of unimproved real estate but such loans shall not exceed sixty-six and two-thirds per cent of the value of the security property, and shall be repayable within three years with interest payable at least semiannually.

(D) An association may make a collateral loan to the extent that it could, under applicable law and regulations, make or purchase the underlying assigned loans. For purposes of this division, a "collateral loan" means a loan which is secured by an assignment of loans.

(E) Notwithstanding the limitations set forth in any other section of the Revised Code, an association may impose a prepayment penalty. On a loan secured by a lien upon a home occupied or to be occupied by the borrower, the prepayment penalty shall comply with the following:

(1) The loan contract shall expressly provide for a prepayment penalty.

(2) If the loan contract provides that the interest rate may be adjusted periodically, no prepayment penalty may be imposed within ninety days following notice of an adjustment to the borrower.

(3) If the association gives written notice to the borrower that the loan is due pursuant to a due-on-sale clause, or commences a foreclosure proceeding to enforce a due-on-sale clause or to seek payment in full as a result of invoking such clause, no prepayment penalty may be imposed.

Effective Date: 07-14-1987

1151.291 Limitation on loans.

Subject to the procedures of this section and section 1151.292 of the Revised Code, a building and loan association may make, invest in, sell, purchase, participate, or otherwise deal in loans to members and others on such terms as are provided by the association upon obligations secured by liens on real estate upon which one or more buildings have been or are to be permanently erected, or which by reason of improvements is usable by a business or industrial enterprise, or which produces sufficient income to maintain the property and retire the loan in accordance with its terms.

(A) Loans made under this section shall not aggregate more than twenty per cent of the association's assets.

(B) The amount loaned on each loan under this section shall not be more than ninety per cent of the appraised value of such real estate.

(C) Except as provided in division (D) of this section, loans under this section shall be payable in weekly, monthly, quarterly, semiannual, or annual installments sufficient to retire the loan within thirty years from the date installment payments are to begin.

(D) Loans under this section, including construction loans, may be granted without provision for amortization of principal, provided such loans require the periodic payment of interest, do not exceed seventy-five per cent of the appraised value of the real estate, and are made for a term of not more than five years.

(E) For the purposes of this section, "installments" means regular periodic payments, equal or unequal, sufficient to retire the debt, interest and principal, within the contract period. Such contract may provide for periods of negative amortization. Payments on all installment loans, except construction loans, shall begin not later than ninety days after the advance of the loan; on installment construction loans, such payments shall begin not later than thirty-six months after the date of the first advance for construction.

Effective Date: 12-09-1982

1151.2911 Charges under revolving credit agreement.

(A) As used in this section:

(1) "Revolving credit agreement" means an agreement pursuant to which a savings and loan association contemplates repeated transactions and the amount of credit that may be extended pursuant to the agreement is made available to the extent that any outstanding balance is repaid. "Revolving credit agreement" does not include an agreement secured by a residential mortgage.

(2) "Residential mortgage" has the same meaning as in section 1109.181 of the Revised Code.

(B) Notwithstanding any limitations contained in the Revised Code, a savings and loan association may charge interest, fees, and other charges under a revolving credit agreement at the same or lower rates or amounts that an association located in another state may charge its revolving credit customers in this state.

Added by 129th General AssemblyFile No.109, HB 322, §1, eff. 9/4/2012.

1151.292 Procedures for real estate loans.

A savings and loan association shall observe the following procedures in making real estate loans:

(A) The association may make loans upon obligations secured by a mortgage or deed of trust on real estate, which mortgage or deed of trust shall be made directly to the association. This section does not prevent an association organized under Chapter 1151. of the Revised Code from accepting additional security when the primary and principal security is a mortgage or deed of trust on real estate.

(B) The title of the borrower shall be a fee simple title or a leasehold or subleasehold estate in real property extending or renewable automatically or at the option of the holder for five years after maturity of the loan, if, in the event of default, the real estate could be used to satisfy the obligation with the same priority as a mortgage or a deed of trust in the jurisdiction where the real estate is located.

(C) In respect to any loan made upon the security of real estate, if it is agreed or contemplated that improvements will be made on such real estate and become a part of such security, such real estate is "improved" within the meaning of division (A) of section 1151.29 and section 1151.291 of the Revised Code and the value of such improvements shall be included in the appraisal value of such real estate; provided however, that as used in this division, the term "improvements" does not include "development" as specified in division (F) of section 1151.293 of the Revised Code.

(D) No such association shall grant a mortgage loan unless it has first obtained a written application, signed by the applicant borrower or his agent, the form and contents of which shall disclose the purpose for which the loan is sought and the identity of the security property. The records for each loan shall contain a written report of the financial ability and credit standing of the borrower.

(E) Machinery and equipment in a building which are adapted to the use being made of the land and building, and which are intended to be permanent additions thereto, will constitute a portion of the real estate for purposes of this chapter and may be appraised in calculating the maximum permissible loan for purposes of this chapter notwithstanding that the law of this state is otherwise for tax or other special purposes.

(F) The records for each loan shall include an appraisal report prepared and signed by an appraisal committee, or by a qualified appraiser designated by its board of directors, prior to the approval of an application for a loan, and shall include information and data concerning the appraised property to substantiate the market value of the security described in such report. Such reports shall be kept by the association in such form as to be available at all times to the examiners or other agents of the superintendent.

(G) No association shall have loans outstanding to any one borrower which, in the aggregate, exceed the lesser of ten per cent of its withdrawable accounts or an amount equal to the sum of its nonwithdrawable accounts, surplus, undivided profits, and reserves, except any association may grant one or more loans aggregating not more than five hundred thousand dollars to one borrower regardless of the above limitations. For purposes of this division, "one borrower" means:

(1) Any person or entity which is, or which upon the making of a loan will become obligor on a real estate loan;

(2) Nominees of such obligor;

(3) All persons, trusts, partnerships, syndicates, and corporations of which such obligor is a nominee or a beneficiary, partner, member, or record [member of record] or beneficial stockholder owning ten per cent or more of the capital stock;

(4) If such obligor is a trust, partnership, syndicate, or corporation, all trusts, partnerships, syndicates, and corporations of which any beneficiary, partner, member, or record [member of record] or beneficial stockholder owning ten per cent or more of the capital stock, is also a beneficiary, partner, member, or record [member of record] or beneficial stockholder owning ten per cent or more of the capital stock of such obligor.

(H) Without the prior written approval of the superintendent, no association shall, directly or indirectly, make any loan, except a consumer loan under section 1151.298 of the Revised Code, to any of its officers, directors, employees, controlling persons, or their spouses, or to any partnership in which any such officer, director, employee, controlling person, or his spouse has any interest, or to any corporation in which any of such parties are stockholders, except that with the prior approval of the association's directors not interested in such loan except as directors, a loan may be made to a corporation in which none of the association's officers, directors, employees, controlling persons, or their spouses own more than fifteen per cent of the total outstanding stock and in which the stock owned by all such parties does not exceed twenty-five per cent of the total outstanding stock, and any director, officer, employee, or controlling person of the association may be granted a loan on the home or combination of home and business property owned and occupied by him. For purposes of this division, "controlling person" includes any attorney or firm of attorneys regularly serving the association in the capacity of attorney at law. All provisions of this division apply to the purchase or sale of any real estate, mortgage loan, or other kind of investment.

(I) The limitations and conditions imposed by Chapter 1151. of the Revised Code do not apply to a purchase money mortgage taken by an association upon real estate sold by it, to a mortgage held by an association to secure a debt previously contracted, or to prevent or diminish loss with respect to loans or renewals of such loans.

(J) The limitations contained in Chapter 1151. of the Revised Code, relating to maximum loan terms and loan-to-value ratios, shall not be applicable to any loan on the security of a first lien on real estate which is being constructed, remodeled, rehabilitated, modernized, or renovated, to be the subject of an annual contributions contract for low-rent housing under the "United States Housing Act of 1937," 50 Stat. 888, 42 U.S.C. 1401, as amended. No loan by an association on the security of such real estate shall exceed ninety per cent of the amount of the appraisal or, in lieu of such appraisal, ninety per cent of the purchase price if the real estate is to be purchased by a local public housing authority. This section shall be applicable to a loan on such real estate only when it is first constructed, remodeled, rehabilitated, modernized, or renovated, or when it first becomes the subject of a contributions contract under said act.

(K) In determining compliance with maximum loan-to-value ratios in this chapter, at the time of making a loan an association shall add together the unpaid amount of all mortgages, liens, or other encumbrances on the security property having priority over the association's mortgage, and shall not make such loan unless the total unpaid balance of such prior mortgages, liens, and other encumbrances, including the one to be made but excluding loans that will be paid off out of the proceeds of the new loan, does not exceed applicable maximum loan-to-value ratios prescribed in this chapter, as indicated by documentation retained in the loan file.

Effective Date: 07-14-1987

1151.293 Procedures for loans for acquisition and development of undeveloped or partially developed land for primarily residential use.

A building and loan association may make, invest in, sell, purchase, participate, or otherwise deal in loans to members and others upon obligations secured by real estate for the acquisition and development of undeveloped or partially developed land for primarily residential use subject to the provisions of section 1151.292 of the Revised Code and the following limitations and procedures:

(A) No association shall have outstanding to any one person, firm, or corporation any such loan or loans made under this section in excess of two per cent of the assets of the association.

(B) The amount loaned on any loan made under this section shall not exceed seventy-five per cent of the appraised value of the completed development of the land into building lots or sites ready for construction thereon for primarily residential use. The loan documentation shall contain a preliminary development plan that is satisfactory to the association.

(C) The term of such loans shall not exceed five years and the interest on any such loan shall be payable at least semiannually. The board of directors of an association may approve the extension of any such loan for a period of not more than two years if the interest on the loan is current and the principal balance of the loan is not in excess of seventy-five per cent of the current appraised value of the real estate security.

(D) The association may, before commencement of or during the development of said land, disburse from the proceeds of any loan made pursuant to this section an amount not in excess of seventy-five per cent of the appraised value of said land, excluding the value of the proposed development.

(E) In addition to the amount authorized to be disbursed by division (D) of this section, an association may disburse, from time to time during the period of development of said land, a total amount not exceeding seventy-five per cent of the value of the developments at the date of such disbursement plus seventy-five per cent of any remaining security. No disbursement shall be made unless the developments have been made in accordance with the preliminary development plan and specifications of the subdivision and in accordance with the requirements of the appropriate governmental authorities.

(F) For the purposes of this section, "development" includes the survey and platting of such land, the laying out and improvement of streets, the installation of water lines and mains, sewers, sidewalks, curbs, and facilities for the disposal of sewage, and the installation of such other improvement as may be necessary or advisable to prepare such land for primarily residential use.

Effective Date: 12-09-1982

1151.294 Investment in mobile home chattel paper.

(A) As used in this section:

(1) "Mobile home" means a movable dwelling for occupancy on land made of one or more units, and having minimum width of ten feet, minimum area of four hundred square feet, and year-round living facilities for one family, including permanent provision for cooking, eating, sleeping, and sanitation.

(2) "Mobile home chattel paper" means a document evidencing a loan or interest in a loan secured by a lien on one or more mobile homes and equipment installed or to be installed therein.

(3) "Manufacturer's invoice price" means a manufacturer's itemized charges, shown on its invoice, for a specifically identified mobile home, furnishings, equipment, and accessories installed by the manufacturer, and freight.

(B) An association may invest up to twenty per cent of its assets in mobile home chattel paper and interests therein.

(C) Appraisals or other generally accepted systems of valuation of used mobile homes shall support loans made under this section. Chattel paper shall have provisions to protect the association, specifically regarding insurance, taxes, other governmental levies, and maintenance and repairs, and may include any other protection provision which is lawful and appropriate. The association may pay taxes or other governmental levies, and insurance premiums or other similar charges to protect its security interest, and may add such payments to the debt evidenced by the chattel paper. The association shall seasonably perfect its security interest.

(D) An association may invest in mobile home chattel paper which finances a mobile home dealer's acquisition of inventory, if all of the following criteria are met:

(1) The inventory is held for sale by the dealer in its ordinary course of business;

(2) The loan evidenced by the chattel paper is the dealer's obligation;

(3) The loan amount does not exceed the following:

(a) For new mobile homes, one hundred per cent of manufacturer's invoice price for each mobile home and equipment to be installed by the dealer;

(b) For used mobile homes, seventy-five per cent of appraised market value or other generally accepted valuation of each mobile home, including installed equipment.

(E) An association may engage in the following types of retail financing:

(1) An association may invest in retail mobile home chattel paper that is guaranteed under the Servicemen's Readjustment Act of 1944, or 38 U.S.C. 1802 as amended, or insured under the National Housing Act or the Servicemen's Readjustment Act of 1944, or 38 U.S.C. 1802 , or that has a commitment for such insurance or guarantee.

(2) An association may invest in conventional retail mobile home chattel paper if:

(a) The mobile home is to be maintained as a residence of the owner, or beneficial owner, or an owner's relative;

(b) The mobile home is located at a mobile home park or other permanent or semipermanent site;

(c) The loan is payable within twenty years, in monthly installments equal or unequal, in amount sufficient to retire the debt, interest, and principal within the contract term. Such contract term may include periods of negative amortization.

(d) The loan amount, excluding time-price differential or interest, however computed, does not exceed ninety per cent of buyer's total costs, including freight, itemized set-up charges, sales or other taxes, filing or recording fees imposed by law, and insurance premiums. Insurance premiums may be financed for customary physical damage insurance and vendor's single interest coverage on the mobile home for an initial policy term not to exceed three years and the cost thereof may be included as part of the buyer's total cost.

(F) With regard to purchase of an interest in retail mobile home chattel paper where the security property is or will be located more than one hundred miles from this state, the seller of the interest shall be an institution whose accounts or deposits are insured by a federal agency or a service corporation thereof and the seller, unless the seller is the association's service corporation, shall retain at least a twenty-five per cent interest in each document evidencing a loan secured by the chattel paper.

(G) All mobile home chattel paper sold by an association shall be sold without recourse.

Effective Date: 12-09-1982

1151.295 Home improvement loans.

A building and loan association may make, invest in, sell, purchase, participate, or otherwise deal in loans, on such terms as are provided by the association with or without security, for property alteration, repair, or improvement, or for the equipping or furnishing of any residential real property.

Loans under this section shall be repayable in regular periodic installments, made at least quarterly, with the first installment due no later than one hundred twenty days from the date the loan is made and the final installment due no later than twenty years and thirty-two days from such date.

For the purposes of this division, "installments" means regular periodic payments, equal or unequal, sufficient to retire the debt, interest, and principal within the contract period. Such contract may provide for periods of negative amortization.

No association may make any equipping loan to a director, officer, or employee of the association, except for the equipping of a home or combination of home and business property owned and occupied, or to be owned and occupied, as a home by such director, officer, employee, or member.

Effective Date: 12-09-1982

1151.296 Loans on securities.

Building and loan companies that have been making loans primarily on other securities than those named in this chapter continuously since January 1, 1913, are authorized to continue loaning on such securities.

Effective Date: 08-03-1955

1151.297 Student loans.

(A) A building and loan association may lend, or purchase loans that have been made, on such terms as are provided by the association upon obligations secured by pledge of any negotiable evidence of debt arising from loans for the payment of expenses of education. The borrower shall certify to the association that the proceeds of the loan are to be used by a full-time or half-time student solely for the payment of expenses of college, university, technical, vocational, or post-secondary education. For the purpose of this section, "education" means education at an institution which has been certified eligible to participate in federal guaranteed student loan programs by the United States department of education pursuant to the "Higher Education Act of 1965," 20 U.S.C.A. 1071 et seq., as amended. However, the aggregate of all loans for education shall at no time exceed five percent of the association's assets.

(B) A building and loan association may lend on such terms as are provided by the association upon obligations secured by pledge of stock or deposits in such association, but such loans shall not exceed the face value of such stock or deposits. No loan may be granted upon nonwithdrawable stock as security and no association may grant loans on stock or deposits when it has on file applications more than thirty days old for the repurchase of stock or the withdrawal of deposits. This section does not prevent an association from renewing such loans existing on August 3, 1955.

(C) A building and loan association may lend on such terms as are provided by the association upon obligations secured by pledge of any of the securities provided for in section 1151.34 of the Revised Code not in excess of ten per cent of the assets of the association.

(D) Notwithstanding sections 1151.29 to 1151.296 and 1151.42 of the Revised Code, a building and loan association may make loans to its members or others evidenced by notes secured by mortgage or representing obligations insured by the federal housing administrator or the secretary of agriculture of the United States under Title I of "The Bankhead-Jones Farm Tenant Act," 50 Stat. 515 (1937), 7 U.S.C. 1010 , as amended, and may sell or hypothecate said notes. Associations may do all things necessary to obtain such insurance.

(E) A building and loan association may make or acquire loans made for a project as defined in section 122.39 of the Revised Code, the payments on which are partly insured by the director of development pursuant to section 122.451 of the Revised Code.

Effective Date: 12-02-1996

1151.298 Consumer loans, commercial paper, and corporate debt securities.

An association may invest in consumer loans, commercial paper, and corporate debt securities subject to the limitations of this section; however, at any one time the total investment made under this section shall not exceed twenty per cent of an association's assets.

(A) An association may make, originate, purchase, sell, service, and participate in direct or indirect consumer loans provided that before indirect loans are made through a dealer, the dealer is approved by the association's board of directors.

(1) If a loan that may be made under this division is also authorized to be made under another section, which may have different percentage-of-assets and other limitations or requirements, an association shall have the option of choosing under which applicable section the loan shall be made.

(2) The total balances of all outstanding unsecured loans to one borrower is limited to the lesser of one-fourth of one per cent of an association's assets or five per cent of its net worth, provided that an association may make up to three thousand dollars in unsecured loans to any one borrower.

For the purposes of this division, "consumer loan" is a secured or unsecured loan to a natural person for personal, family, or household purposes.

(B) An association may invest in, sell, or hold commercial paper and corporate debt securities, including corporate debt securities convertible into stock, subject to the limitations set forth in divisions (B)(1) and (2) of this section.

(1) An investment under this section includes the investing in, redeeming, or holding of shares in any open-end management investment company which is registered with the securities and exchange commission under the "Investment Company Act of 1940," 54 Stat. 847, 15 U.S.C. 80a-1 , and amendments thereto, and whose portfolio is restricted by such management company's investment policy, changeable only if authorized by shareholder vote, solely to the investments that an association is authorized to invest in under this division and other rules or law.

(2) Investments under this division are limited as follows:

(a) As of the date of purchase, as shown by the most recently published rating made of such investments by at least one nationally recognized investment rating service, the commercial paper must be rated in one of the two highest grades and the corporate debt securities must be rated in one of the four highest grades.

(b) The commercial paper or corporate debt securities must be denominated in dollars and the issuer must be domiciled in the United States.

(c) At any one time, an association's total investment in the commercial paper and corporate debt securities of any one issuer, or issued by any person or entity affiliated with such issuer, must not exceed one per cent of the association's assets, but, this provision does not apply to investments in the shares of an open-end management investment company. In such cases, an association's total investment in the shares of any one such company must not exceed five per cent of the association's assets.

(d) Investments in corporate debt securities convertible into stock are subject to the following additional limitations:

(i) Purchase of securities convertible into stock at the option of the issuer is prohibited;

(ii) At the time of purchase, the cost of such securities must be written down to an amount which represents the investment value of the securities considered independently of the conversion feature;

(iii) Such securities must be traded on a national securities exchange;

(iv) Associations are prohibited from exercising the conversion feature.

(e) At any one time, the average maturity of an association's portfolio of corporate debt securities must not exceed six years.

(f) An association must maintain information in its files adequate to demonstrate that it has exercised prudent judgment in making investments under this division.

For the purposes of this division, "commercial paper" is any note, draft, or bill of exchange which arises out of a current transaction or the proceeds of which have been or are to be used for current transactions, and which has maturity at the time of issuance of not exceeding nine months, exclusive of days of grace, or any renewal thereof the maturity of which is likewise limited. A "corporate debt security" is a marketable obligation, evidencing the indebtedness of any corporation in the form of a bond, note or debenture which is commonly regarded as a debt security and is not predominantly speculative in nature. A security is marketable if it may be sold with reasonable promptness at a price which corresponds reasonably to its fair value.

(C) Notwithstanding the limitations set forth in divisions (A) and (B) of this section, the superintendent may permit an association to invest in corporate debt securities of another institution in connection with the purchase or sale of a branch office, or in connection with a supervisory merger or acquisition.

Effective Date: 07-14-1987

1151.299 Credit card operations.

A building and loan association may issue credit cards, extend credit in connection therewith, and otherwise engage in or participate in credit card operations.

Effective Date: 12-09-1982

1151.2910 Commercial and standby letters of credit.

(A) A savings and loan association may issue commercial and standby letters of credit and may pledge collateral to secure its obligations thereunder, subject to Chapter 1305. of the Revised Code and to the following requirements:

(1) Each letter of credit must conspicuously state that it is a letter of credit;

(2) The issuer's undertaking must contain a specified expiration date or be for a definite term, and must be limited in amount;

(3) The issuer's obligation to pay must be solely dependent upon the presentation of conforming documents as specified in the letter of credit, and not upon the factual performance or nonperformance by the parties to the underlying transaction;

(4) The account party must have an unqualified obligation to reimburse the issuer for payments made under the letter of credit.

(B) To the extent funds are advanced under a letter of credit without compensation from the account party, the amount shall be treated as an extension of credit subject to percentage-of-assets limits and other requirements under an applicable provision of this chapter.

Effective Date: 07-14-1987

1151.30 Loans for commercial, corporate, business, or agricultural purposes.

A savings and loan association may make, invest in, sell, purchase, and participate, or otherwise deal in secured or unsecured loans for commercial, corporate, business, or agricultural purposes. Loans made under this section shall not exceed ten per cent of the association's assets. The superintendent of savings and loan associations may, by rule promulgated in accordance with Chapter 119. of the Revised Code, increase this limitation to a maximum of thirty per cent of assets, provided that the reserve requirement for an association with an investment exceeding ten per cent of assets shall increase in proportion to the amount of the investment.

The rule shall include a schedule setting the reserve requirements for investments in amounts exceeding ten per cent of assets.

Effective Date: 09-03-1984

1151.301 [Repealed].

Effective Date: 12-09-1982

1151.31 Loans guaranteed by federal administrator of veterans' affairs and other federal agencies.

Notwithstanding sections 1151.29 to 1151.296 , inclusive, and 1151.42 of the Revised Code and the constitution and bylaws of the building and loan association, the association may make, buy, sell, or hypothecate any loan secured by lien on real estate, if the loan is approved, insured, or guaranteed, in part or in full, or if a conditional guarantee of the loan has been issued, by the federal administrator of veterans' affairs, or by the United States or any instrumentality thereof.

A farm loan made under this section shall be deemed secured by lien on real estate, even though the security includes livestock or farm equipment, or both, if such livestock or farm equipment, or both, are used in connection with the operation of the real estate pledged as security for said loan.

Effective Date: 08-03-1955

1151.311 Participating interests in real estate loans.

(A) For the purposes of this section, "lender" or "lenders" means any building and loan association, savings and loan association, bank, or insurance company, which is supervised by an instrumentality of the United States or by any state within the United States, any service corporation, in which the entire capital stock is owned by one or more such building and loan associations, any agency or instrumentality of the United States or any state thereof, or any mortgagee approved by the federal housing administrator.

(B) A building and loan association may participate with another lender or lenders in making real estate loans or may purchase participating interests in real estate loans which would be qualified under Chapter 1151. of the Revised Code for investment by the association, but only the amount of the association's participation interest shall be included in applying any per cent of assets limitation of Chapter 1151. of the Revised Code.

(C) A building and loan association may sell one or more participating interests in a mortgage loan or loans. Sales of participating interests may be made with or without recourse to the seller.

(D) No association shall engage in any participation loan transaction not authorized by this section without prior written approval by the superintendent of building and loan associations.

(E) An association may service any real estate loan in which:

(1) The association held an interest at any time;

(2) Any member, stockholder, borrower, or depositor of the association held an interest at any time;

(3) An interest is held by a deposit guaranty association organized under sections 1151.80 to 1151.92 of the Revised Code, or any private or public association organized for a similar purpose as may be approved by the superintendent;

(4) Any lender as defined by division (A) of this section.

Effective Date: 12-09-1982

1151.312 Issuing and selling mortgage-backed securities.

A building and loan association may, singly or in joint venture with other eligible issuers, issue and sell trust certificates or other securities based on and backed by a trust or pool composed of mortgages which are insured under the "National Housing Act," 48 Stat. 1248 (1934), 12 U.S.C. 1709 , or which are insured or guaranteed under the "Servicemen's Readjustment Act of 1944," 72 Stat. 1203, 38 U.S.C. 1801 , and guaranteed as to payment of principal and interest by the "Government National Mortgage Association," pursuant to the "Housing and Urban Development Act of 1968," 12 U.S.C. 1721(g) . As used in this section, any reference to a federal law includes all amendments thereto and reenactments thereof.

Effective Date: 12-30-1971

1151.32 Blanket mortgage loans authorized - limitation.

A building and loan association may make loans to members and others evidenced by a note or notes secured by one mortgage on two or more properties in an amount not in excess of the total of their several loanable amounts.

Effective Date: 11-21-1967

1151.321 Canceling loans - debt suspension or cancellation agreement.

(A) Except as provided in division (B) of this section, a savings and loan association may cancel loans mentioned in sections 1151.29 to 1151.32 of the Revised Code, and release the securities for them on such terms as its board of directors provides.

(B)

(1) Subject to division (B)(2) of this section and any restrictions or requirements established by the superintendent of financial institutions, in connection with any loan or extension of credit, a savings and loan association may enter into a debt suspension agreement or debt cancellation contract with the borrower or borrowers.

(2) A savings and loan association shall not offer or finance, directly or indirectly, a debt suspension agreement or debt cancellation contract requiring a lump sum, single payment for the agreement or contract payable at the outset of the agreement or contract, if the debt subject to the agreement or contract is secured by one to four family, residential real property.

(3) For purposes of division (B) of this section, "debt cancellation contract" and "debt suspension agreement" have the same meanings as in 12 C.F.R part 37.

Effective Date: 10-01-1953; 04-06-2007

1151.323 Loans for housing suitable primarily for occupancy for persons over fifty-five.

A building and loan association may make, purchase, or participate in loans secured by real estate subject to the procedures of section 1151.292 of the Revised Code and the following limitations:

(A) Loans made under this section shall not exceed five per cent of the association's assets.

(B) The real estate pledged to secure the obligation shall be designed to provide accommodations for occupancy in multiple residential units by persons over fifty-five years of age, or to provide residential care facilities or nursing homes, so constructed or altered as to be suitable primarily for occupancy by persons over fifty-five years of age, and limited principally to occupancy by such persons.

(C) The amount loaned shall not be more than ninety per cent of the fair value of such real estate as determined by the appraisal. If a loan which has been made under this section is reduced to an amount which is eighty per cent or less of the appraised value of the real estate, the loan may then be considered having been made under section 1151.29 of the Revised Code, provided the purpose of the loan remains the same.

(D) Loans shall be payable pursuant to division (A)(4) of section 1151.29 of the Revised Code.

Effective Date: 09-29-1995

1151.33 Reserve funds.

A building and loan association shall establish and maintain such reserve and net worth accounts as the superintendent shall require by rule. The superintendent shall promulgate such rule or rules in accordance with Chapter 119. of the Revised Code.

Effective Date: 12-09-1982

1151.34 Investment and deposit of idle funds.

(A) A savings and loan association may invest any of its funds in bonds or interest-bearing obligations of the United States, or for which the faith and credit of the United States are pledged for the payment of principal and interest.

(B) Such association may invest any of its funds in the general obligations of any state, territory, possession of the United States, or political subdivision thereof, provided such obligations if not of this state or political subdivision thereof, at the time of investment are rated in one of the four highest grades as shown by the most current publication of a nationally recognized investment rating service.

(C) Such association may invest its funds in revenue bonds, including those issued by any state, political subdivision of a state, public corporation, or government agency, under such conditions and restrictions as the superintendent of savings and loan associations prescribes by rule, provided that in no event may more than ten per cent of the assets of an association be invested in such bonds and obligations.

(D) Such association may invest any of its funds in obligations issued or fully guaranteed as to principal and interest by the agencies and instrumentalities created pursuant to the following acts and amendments thereto:

(1) "Federal Farm Loan Act of 1916," 39 Stat. 360, 12 U.S.C. 641 ;

(2) "Farm Credit Act of 1933," 48 Stat. 257, 12 U.S.C. 131 ;

(3) "Federal Home Loan Bank Act of 1932," 47 Stat. 725, 12 U.S.C. 1421 ;

(4) "Home Owners' Loan Act of 1933," 48 Stat. 128, 12 U.S.C. 1461 ;

(5) "Federal National Mortgage Association," created by the Act of August 1, 1968, 68 Stat. 612, 12 U.S.C. 1717 ;

(6) "Tennessee Valley Authority Act of 1933," 48 Stat. 58, 16 U.S.C. 831 ;

(7) "Export-Import Bank Act of 1945," 59 Stat. 526, 12 U.S.C. 635 ;

(8) "Commodity Credit Corporation Charter Act," 62 Stat. 1070, 15 U.S.C. 714 ;

(9) "Central Bank for Cooperatives," organized pursuant to the Act of June 16, 1933, 48 Stat. 261, 12 U.S.C. 1134f ;

(10) "Government National Mortgage Association," created by the Act of August 1, 1968, 82 Stat. 536, 12 U.S.C. 1716b ;

(11) "Federal Home Loan Mortgage Corporation Act," 84 Stat. 451, 12 U.S.C. 1451 ;

(12) "Federal Financing Bank Act of 1973," 87 Stat. 937, 12 U.S.C. 2281 .

(E) An association may invest in any securities acceptable to the United States to secure government deposits in national banks.

(F) An association may invest in notes and debentures issued by a deposit guaranty association incorporated in accordance with sections 1151.81 to 1151.86 of the Revised Code.

(G) An association may invest in banker's acceptances of a commercial bank whose deposits are insured by the federal deposit insurance corporation and which is not under the control or in the possession of any supervisory authority, provided the remaining periods to maturity are not more than nine months and the total acceptances held by the association in one bank does not exceed one-half of one per cent of the total deposits of such bank as shown by its last published statement of condition preceding the date such acceptances are acquired.

(H) An association may invest in loans of federal funds or similar unsecured loans to an insured bank or savings and loan association whose accounts are federally insured. Such a loan shall not exceed the greater of one-half of one per cent of such bank's or savings and loan association's total deposits, as shown by its last published statement of condition, or one hundred thousand dollars, and its term shall not exceed six months.

(I) An association may invest in any obligations or other instruments, or any securities of the "Student Loan Marketing Association," 12 U.S.C. 1464(c) .

(J) An association may invest any of its funds in shares or certificates in any open-end management investment company registered with the securities and exchange commission under the "Investment Company Act of 1940," 54 Stat. 847, 15 U.S.C. 80a-1 , and amendments thereto, and while the portfolio of such company is restricted by its investment policy, changeable only by the vote of the shareholders, to investments set forth in divisions (A) to (Q) of this section and division (B) of section 1151.35 of the Revised Code.

(K) Such association may acquire, in exchange for eligible real estate, home mortgages, and other obligations and liens secured by real estate, bonds or other securities issued by the home owners' loan corporation under the "Home Owners' Loan Act of 1933," 48 Stat. 128, 12 U.S.C. 1461 and any amendments thereto.

(L) Such association may deposit any of its funds in any financial institution that is subject to inspection by the United States or by any state.

(M) Such association may invest in real property, or in interests in real property, and in loans upon obligations secured by real estate located within urban renewal areas as defined in the "Housing Act of 1949," 63 Stat. 413, 42 U.S.C. 1460, and in community urban redevelopment corporations as defined in section 1728.01 of the Revised Code, in addition to other lending authority granted in this chapter, and regardless of the limitation of division (A) of section 1151.291 of the Revised Code. Such investments in real property or in interests in real property shall not exceed five per cent of the association's assets, and the sum of such loans authorized by this division shall not exceed twenty per cent of the association's assets.

(N) Such association may invest no more than one per cent of its assets in:

(1) Shares of stock issued by the national corporation for housing partnerships or any other corporation created by the "Housing and Urban Development Act of 1968," 82 Stat. 476, 42 U.S.C. 3931 ;

(2) Limited partnership interests in the national housing partnership, or other limited partnerships created under the "Housing and Urban Development Act of 1968," 82 Stat. 549, 42 U.S.C. 3937(a) ;

(3) Any partnership, limited partnership, or joint venture authorized under such act by 42 U.S.C. 3937(c) .

(O) Such association may invest in shares issued by:

(1) Venture capital firms organized under the laws of the United States or of this state and having an office within this state, provided that, as a condition of an association making an investment in a venture capital firm, the firm must agree to use its best efforts to make investments, in an aggregate amount at least equal to the investment to be made by the association in that venture capital firm, in small businesses having their principal offices within this state and having either more than one-half of their assets within this state or more than one-half of their employees employed within this state.

As used in divisions (O) (1) and (2) of this section:

(a) "Venture capital firms" means any corporation, partnership, proprietorship, or other entity, the principal business of which is or will be the making of investments in small businesses.

(b) "Small businesses" means any corporation, partnership, proprietorship, or other entity that either does not have more than four hundred employees, or would qualify as a small business for the purpose of receiving financial assistance from small business investment companies licensed under the "Small Business Investment Act of 1958," 72 Stat. 689, 15 U.S.C. 661 , as amended, and rules of the small business administration.

(c) "Shares" means any equity interests, including limited partnership interests and other equity interests in which liability is limited to the amount of the investment, but does not include general partnership interests or other interests involving general liability.

(2) Small businesses having more than half of their assets or employees within this state.

Investments made under division (O) of this section shall not exceed in the aggregate five per cent of the association's assets.

(P) An association may invest in shares issued by a domestic insurance company organized under Chapter 3907. or 3925. of the Revised Code, regulated by the superintendent of insurance under Title XXXIX of the Revised Code or division (R) or any other division of this section, the total amount which any association may invest in the common stock, obligations, and other securities of such companies may not exceed ten per cent of the association's assets. An association may not invest more than ten per cent of its net worth in the common stock, obligations, and other securities of any one such domestic insurance company. An association may file an application with the superintendent of savings and loan associations for permission to invest an amount in excess of ten per cent of the association's net worth in the common stock, obligations, and other securities of any one such domestic insurance company. Any association making investments pursuant to this division shall report such investments annually on the first day of March to the superintendent of savings and loan associations and the superintendent of insurance. The report shall include, for each reinsurer in which the association has made an investment, information as to the amount of reinsurance written in this state by each line of insurance designated by the superintendent of insurance.

(Q) In exercising its investment authority under this section, such association shall give equal consideration to investments which involve minority owned and controlled firms and firms owned and controlled by women either alone or in joint venture with other firms where such investments offer quality return and safety comparable to other investments currently available to the association.

(R) An association may invest no more than ten per cent of its assets in stock or other equity securities of corporations, or bonds, debentures, notes, or other evidences of indebtedness issued, assumed, or guaranteed by corporations, as authorized by the board of directors of the association.

Effective Date: 01-05-1988

1151.341 Federal national mortgage association stock.

A building and loan association may subscribe to, buy, own and hold stock of a federal national mortgage association as required by Title 3, section 303, of the federal act known as the "National Housing Act of 1954," 68 Stat. 590, 12 U.S.C. 1716 , and amendments thereto. Such stock shall be carried on the books of the association at the cost to the association.

Effective Date: 01-10-1961

1151.342 Community improvement corporations loans.

A building and loan association may invest in the bonds, debentures, notes, or other evidences of indebtedness of community improvement corporations organized under Chapter 1724. of the Revised Code.

An association may subscribe to buy, own, and hold stock and may invest in the bonds, debentures, notes, or other evidences of indebtedness of development corporations organized under Chapter 1726. of the Revised Code. The aggregate amount of stockholdings, investments, loans, and commitments of any association made pursuant to this section in or to the corporations authorized by Chapter[s] 1724. and 1726. of the Revised Code shall not exceed one per cent of the total outstanding loans made by such association.

In addition to the authority otherwise granted by this chapter, an association may make real estate loans to such corporations which would be authorized under the lending powers granted the association under Chapter 1151. of the Revised Code.

Effective Date: 08-27-1970

1151.343 Loans and investments not exceeding percentage of assets.

A building and loan association may make additional loans and investments under divisions (A) and (B) of this section provided that the aggregate balance of such loans and investments does not exceed three per cent of its total assets, unless the sum of the permanent stock, general reserves, surplus, and undivided profits of the association exceeds five per cent of its total assets. In that case, it may hold additional amounts of such assets, not to exceed in the aggregate one and one-half per cent of its total assets for each percentage point by which the sum of its permanent stock, general reserves, surplus and undivided profits exceeds five per cent of its total assets, but the aggregate of all assets held by any association under the authority of this section shall not exceed ten per cent of its total assets.

(A) An association may make any loan or investment authorized by any other section of Chapter 1151. of the Revised Code, except in stock of a service corporation organized pursuant to division (B) of section 1151.344 of the Revised Code, notwithstanding that such loan or investment may exceed the asset limitation of such type loan or investment.

(B) An association may make any of the following loans:

(1) Secured or unsecured loan to its employees and their immediate families not in excess of five thousand dollars;

(2) Interim financing for the purpose of financing construction of modular housing units;

(3) Lines of credit to a builder for the purpose of financing improvements of real property.

(C) In addition to any loans which an association may make under any other section of Chapter 1151. of the Revised Code, an association may invest:

(1) An amount not exceeding the greater of its surplus, undivided profits, and reserves or five per cent of its assets in loans the principal purpose of which is to provide financing with respect to what is or is expected to become primarily residential real estate where the association relies substantially for repayment on all of the following criteria are met :

(a) The borrower's general credit standing and forecast of income, with or without other security;

(b) Other assurances of repayment, including but not limited to a third-party guaranty or similar obligation.

(2) An amount not exceeding five per cent of its assets in loans, advances of credit, and interests therein, secured by residential real estate or real estate used or to be used for commercial farming, which are not otherwise authorized under this chapter.

Effective Date: 12-09-1982

1151.344 Loans to and investments in capital stock, obligations, and other securities of service corporations.

A savings and loan association may invest a total of fifteen per cent of the association's assets in the capital stock, obligations, and other securities of service corporations organized under the laws of this state to provide services to domestic or foreign associations, as defined in section 1151.01 of the Revised Code, the capital stock of which is available for purchase only by savings and loan associations.

(A) If no association holds more than fifty per cent of the capital stock of such corporation, the corporation may provide services compatible with the purposes, powers, and duties of savings and loan associations. Such service corporation may also provide mechanical, clerical, and record keeping services for other corporations, other persons, or governmental units subject to the written approval of the superintendent of building and loan associations.

Notwithstanding the investment limitation of this division, an association may make any loan authorized by any other section of Chapter 1151. of the Revised Code to such a service corporation or to a joint venture of the service corporation in which an association has an investment of not more than ten per cent of the service corporation's capital stock. The aggregate of all such loans shall not exceed fifty per cent of the association's net worth.

(B) If one association stockholder holds more than fifty per cent of the corporation's capital stock, such service corporation may provide only such services as the superintendent of building and loan associations authorizes by rules promulgated in accordance with Chapter 119. of the Revised Code.

Notwithstanding the investment limitation of this division, an association may make any loan authorized by any other section of Chapter 1151. of the Revised Code to a service corporation or to a joint venture of the service corporation in which an association has made an investment pursuant to this division. The aggregate of all such loans shall not exceed twenty per cent of the association's net worth.

In the adoption of rules authorized by this division, the superintendent may authorize services which he determines to be so related to the business of building and loan associations as to be a proper incident thereto. In determining whether a particular service is a proper incident to a building and loan association the superintendent shall consider whether its performance by a service corporation can reasonably be expected to produce benefits to the public, such as greater convenience, increased competition, or gains in efficiency, that outweigh possible adverse effects, such as undue concentration of resources, decreased or unfair competition, conflicts of interests, or unsound building and loan association practices.

The superintendent may at any time examine the affairs of any service corporation in which an association organized under the laws of this state owns stock. Whenever a service corporation or a building and loan association fails to meet the requirements and limitations set forth in this division, all loans or investments by a building and loan association to or in such service corporation constitute unauthorized investments.

Notwithstanding the investment limitation of this section, an association that meets the requirements of section 1151.33 of the Revised Code may make any loan authorized by any other section of Chapter 1151. of the Revised Code to a service corporation or to a joint venture of the service corporation, provided that the association has no investment in such service corporation and that no association owns more than ten per cent of the service corporation's capital stock.

For purposes of this section, "service corporation" includes any subsidiary of a service corporation.

Effective Date: 09-03-1984

1151.345 Preneed cemetery merchandise and services contracts.

A savings and loan association, in accordance with sections 1721.211 and 4717.31 to 4717.38 of the Revised Code, may receive and hold on deposit moneys under a preneed funeral contract or a preneed cemetery merchandise and services contract.

Effective Date: 10-20-1999; 2008 SB196 07-06-2009

1151.346 Other loans and investments.

(A) In addition to the other loans and investments provided for in Chapter 1151. of the Revised Code, but subject to all other provisions of the Revised Code, a savings and loan association may invest up to fifteen per cent of the association's assets in such loans or investments as are authorized by the board of directors of the association.

(B) If a loan or other investment is authorized under more than one section of Chapter 1151. of the Revised Code, an association may designate under which section the loan or investment has been made. Such a loan or investment may be apportioned among appropriate categories, and may be moved, in whole or in part, from one category to another.

Effective Date: 09-03-1984

1151.347 Reporting investments in venture capital firms.

(A) By the fifteenth day of January of every year, each savings and loan association shall report in writing to the superintendent of savings and loan associations on investments the savings and loan association has made pursuant to division (O) of section 1151.34 of the Revised Code as of the thirty-first day of December of the previous year. The report shall contain such information as the superintendent requires.

(B) By the first day of March of each year, the superintendent shall report in writing to the chairperson of the standing committee of each house of the general assembly which normally considers economic development legislation the superintendent's findings regarding investments made by savings and loan associations pursuant to division (O) of section 1151.34 of the Revised Code.

Effective Date: 12-15-1986

1151.348 License required to engage in trust business.

(A) A savings and loan association authorized to do business by the division of financial institutions pursuant to Chapters 1151. to 1157. of the Revised Code may engage in trust business after obtaining a license under section 1111.06 of the Revised Code.

(B) Except as provided in division (C) of this section, a savings and loan association that is licensed under section 1111.06 of the Revised Code is a trust company as defined in division (S) of section 1101.01 of the Revised Code for purposes of Chapter 1111. of the Revised Code and of all laws applicable to a trust company.

(C) The division shall supervise any savings and loan association licensed as a trust company under Chapter 1111. of the Revised Code pursuant to Chapters 1151. to 1157. of the Revised Code, except that the division may apply provisions in Chapter 1111. of the Revised Code in the case of a voluntary or forced liquidation of a savings and loan association's trust business.

Effective Date: 04-06-2007

1151.349 Leasing activities.

(A) As used in this section:

(1) A "net lease" is a lease under which a savings and loan association, directly or indirectly, will not be obligated to:

(a) Service, repair, or maintain the leased property during the lease term;

(b) Purchase parts and accessories for the leased property; however, improvements and additions to the leased property may be leased to the lessee upon its request in accordance with the full-payout requirements of this section;

(c) Furnish replacement or substitute property while the leased property is being serviced;

(d) Purchase insurance for the lessee, unless the lessee has failed to purchase or maintain insurance required by contract;

(e) Renew any license or registration for the property unless such action is necessary to protect the association's interest as an owner or financer of the property.

(2) A "full-payout lease" is one from which the lessor can reasonably expect to realize a return of its full investment in the leased property plus the estimated cost of financing the property over the term of the lease derived from:

(a) Rentals;

(b) Estimated tax benefits; and

(c) The estimated residual value of the property when the initial term of the lease expires. However, no more than twenty per cent of the return may be realized from the residual value. Both the estimated residual value of the property and that portion of the estimated residual value relied upon by the lessor to satisfy the requirements of a full-payout lease must be reasonable so that realization of the lessor's full investment, plus the cost of financing the property, primarily depends on the credit-worthiness of the lessee, and not on the residual market value of the leased item. The maximum term of a full-payout lease shall be forty years.

(B) In addition to the provisions of Chapter 1151. of the Revised Code regarding lending, a savings and loan association may also engage in leasing activities that are the functional equivalent of lending, subject to the following conditions. An association may:

(1) Become the legal or beneficial owner of tangible personal property or real property for the purpose of leasing such property; or

(2) Obtain an assignment of a lessor's interest in a lease of such property; and

(3) Incur obligations incidental to its position as the owner and lessor of the leased property, provided the lease is a net, full-payout lease representing a noncancelable obligation of the lessee. At the expiration of the lease the association shall liquidate, or release on a net basis, all interest in the property as soon as practicable.

(C) If an association believes that there has been an unanticipated change in conditions which threatens its financial position by significantly increasing its exposure to loss, divisions (A) and (B) of this section do not prevent the association:

(1) As owner and lessor under a net, full-payout lease, from taking reasonable and appropriate action to salvage or protect the value of the property or its interests arising under the lease; or

(2) As assignee of a lessor's interest in a lease, from becoming owner and lessor of the leased property pursuant to its contractual right, or from taking any reasonable and appropriate action to salvage or protect the value of the property or its interests arising under the lease; or

(3) From including any additional provisions or agreements in a lease, to protect its financial position or investment in the circumstances set forth in divisions (C)(1) and (2) of this section.

(D) A lease of tangible personal property made to a natural person for personal, family, or household purposes pursuant to this section is subject to all limitations applicable to the amount of an association's investment in consumer loans. A lease made for commercial, corporate, business, or agricultural purposes pursuant to this section is subject to all limitations applicable to the amount of an association's investment in commercial loans. A lease of residential or nonresidential real property made pursuant to this section is subject to all limitations applicable to the amount of an association's investment in real estate loans.

(E) In addition to the authority set forth in division (A) of this section, an association may also invest up to ten per cent of its assets in tangible personal property including, without limitation, vehicles, manufactured homes, mobile homes, machinery, equipment, or furniture for rental. The estimated residual value at the expiration of the initial term of the lease shall not exceed seventy per cent of the lessor's acquisition cost.

Effective Date: 03-30-1999

1151.35 Membership in federal home loan bank.

(A) A building and loan association may become a member of, acquire stock in, and deposit money with a federal home loan bank created by the "Federal Home Loan Bank Act" and amendments thereto, including the "Home Owners' Loan Act of 1933," or by supplements to said acts, and laws enacted in substitution therefor. Such association may do everything required, authorized, or permitted by such acts and laws of or to members of a federal home loan bank created therein, including, among other things, conversion of the association into a federal savings and loan association, as authorized by such acts and laws and pursuant to any rules and regulations prescribed thereunder; but such conversion shall be made only in compliance with section 1151.36 of the Revised Code.

(B) An association may acquire debt or equity securities in, and deposit money with any bank engaged primarily in the business of providing its services to associations, including the Bank for Savings and Loan Associations, Chicago, Illinois.

Effective Date: 08-26-1977

1151.36 Conversion into federal savings and loan association.

A building and loan association may convert itself into a federal savings and loan association as authorized by the acts of congress described in section 1151.35 of the Revised Code, and pursuant to the rules and regulations prescribed thereunder, by proceedings as follows;

(A) The board of directors of the association shall adopt a resolution fixing the time and place of holding a special meeting of all the stockholders of every class, and shall cause not less than twenty days' written notice of such time and place and of the purpose of such meeting to be given to each such stockholder, either personally or by mail directed to him at his last known post-office address appearing upon the records of the association.

(B) At such meeting a resolution to make such conversion shall be adopted as provided in the "Home Owners' Loan Act of 1933" and amendments thereto.

(C) Within one week after the date of such stockholders' meeting, copies of the resolution of the board and of the minutes of such meeting of stockholders, together with a statement showing the giving of such notice, all verified by an affidavit of the president or a vice-president, and of the secretary or an assistant secretary of the association, shall be filed in the office of the superintendent of building and loan associations.

(D) Within eight months after the date of such stockholders' meeting, there shall be filed in the office of the superintendent:

(1) Two copies of the federal savings and loan association charter issued to the federal savings and loan association into which the conversion is to be made, each of which copies shall be certified by the authority issuing it, together with a payment of five dollars;

(2) A copy of a resolution of the board, or other authorized agency, of such federal savings and loan association, verified by affidavit of the proper custodian of its records, showing the assumption by such federal savings and loan association of all liabilities of the converting domestic associations as of the date on which conversion is to be completed, and the manner in which each class of such liabilities will be discharged or adjusted by such federal savings and loan association; but if such charter provides for such assumption, such copy need not be filed.

The superintendent may extend the time for the filing of any document required to be filed in his office by this section.

(E) When the requirements of divisions (A), (B), (C), and (D) of this section have been complied with, the superintendent shall within ten days thereafter file one copy of the federal savings and loan association charter, filed with him, with his approval indorsed thereon, in the office of the secretary of state, and for that purpose shall transmit the payment of five dollars to the secretary of state. Until such copy is filed in the office of the secretary of state, such association shall continue to have and exercise its corporate powers under its charter, constitution, and bylaws, and to be subject to the laws of this state and the authority of the superintendent, and its property and assets shall remain vested in it; but on the day and hour of such filing, such association shall be deemed converted into the federal savings and loan association evidenced by such charter, and thereupon:

(1) The corporate powers of the association under the laws of this state shall cease to exist and its constitution and bylaws shall cease to be in force.

(2) Its articles of incorporation shall be deemed canceled and annulled.

(3) All its property and assets, and every right, privilege, and interest then existing, belonging or pertaining to it, or which would inure to it, shall immediately, without any conveyance or transfer and without any further act or deed, be vested in and become the property of the successor federal savings and loan association, which shall hold and enjoy them in its own right, to the same extent as they were held and enjoyed by the association. All liens upon the property and assets of such association existing at the time of conversion shall be preserved unimpaired and limited in lien to the property or assets then affected thereby. This section does not deprive any person, firm, or corporation of any substantive right existing against such association at the time of such conversion, nor of the right to enforce any such right by proceedings against the property and assets transferred by operation of this division, in the event and to the extent that such substantive right is not satisfied or adjusted by the successor federal savings and loan association in accordance with its charter or with the resolution of assumption.

(4) The power and authority of the superintendent with respect to such association, its property, and its assets shall terminate.

Any action or proceeding pending by or against such association at the time of such conversion may be prosecuted to judgment, with right of appeal as in other cases, as if such conversion had not taken place, or the successor federal association may be substituted for such association.

A copy of each federal savings and loan association charter filed in the office of the secretary of state, certified by the secretary of state under the seal of his office and showing the day and hour of filing, shall be recorded in the office of the county recorder of the county in which the association had its principal office or place of business at the time of its conversion, and in each county in the state in which such association owned real estate at the time of its conversion, for which recording the recorder shall charge the same fees as for the recording of deeds.

Effective Date: 10-01-1953

1151.361 Federal savings and loan associations have equal rights.

Federal savings and loan associations, the home office of which is located within this state, shall possess all the rights, powers, privileges, benefits, immunities, and exemptions existing on or provided after September 21, 1961, by the laws of this state for associations organized under Chapter 1151. of the Revised Code and for the members and savings account holders thereof unless federal laws or regulations provide otherwise. This provision is additional and supplemental to any provision which, by specific reference, is applicable to federal savings and loan associations and members thereof.

Effective Date: 01-23-1963

1151.37 Purchase of shares in federal savings and loan association - joint occupancy of offices.

With the written consent of the superintendent of building and loan associations, but not otherwise, and upon compliance with such conditions as the superintendent imposes, a building and loan association may purchase shares of stock of a federal savings and loan association situated in the county in which the purchasing association has its principal office, the consideration for which shares may be money or any other kind of assets of the purchasing association, and may distribute such shares. In the event of such purchase, the purchasing association may, with the approval of the superintendent, occupy joint or adjoining officers with such federal savings and loan association. Unless authorized by the superintendent, the officers and directors of such purchasing association may not be officers and directors of such federal savings and loan association.

If the superintendent disapproves such purchase of shares, the distribution of such shares, such joint occupancy, or such joint officers and directors, an association deeming itself aggrieved by such disapproval may, within thirty days thereafter, file a petition in the court of common pleas of the county in which the principal office of the complaining association is located, for a review of the action and decision of the superintendent, which petition shall allege that the superintendent exceeded his powers or abused his discretion in the premises. If such court finds from the evidence that such allegation is true, it may issue an order setting aside the disapproval of the superintendent and approve such purchase of shares, the distribution of such shares, such joint occupancy, or such joint officers and directors, and such decision of such court shall be final.

If the superintendent fails to act within sixty days after such a plan to purchase shares of stock of a federal savings and loan association has been submitted to him, he shall be deemed to have approved such purchase.

Effective Date: 10-01-1953

1151.38 Conversion of federal association into state association.

As used in this section, "federal association" means a federal savings and loan association, and "state association" means a state savings and loan association.

Any federal association having its home office in this state may convert or reorganize into a state association under this section and section 1151.39 of the Revised Code by proceeding as follows:

(A) The board of directors of the federal association, at any regular or special meeting called for that purpose, shall adopt a plan to convert or reorganize into a state association.

(B) The plan and any amendments or additions to the plan shall be considered, and a vote shall be taken on the question of its adoption, at an annual meeting of the members of the federal association or at any special meeting of the members of the federal association called to consider the action. If the bylaws of the federal association do not require written notice of the annual or special meeting, written notice of the time, place, and purpose of such meeting shall be mailed by the federal association, postage prepaid, at least ten days prior to the date on which such meeting convenes, to each member of record of the federal association, but the mailing shall not be a condition precedent to, nor shall any defect in the mailing affect the validity of, the meeting. The adoption of the plan shall require the vote of fifty-one per cent or more of the votes cast by the members present in person or by proxy at such meeting.

(C) Two copies of the minutes of such meeting, together with a statement showing the giving of the written notice, and two copies of the minutes of the meeting of the members of the board of the federal association, all verified by an affidavit of the secretary or other proper custodian of the records of the federal association, shall be filed both in the office of the superintendent of financial institutions and with the federal home loan bank board. Such verified copies, when filed, shall be presumptive evidence of the holding and action of such meeting.

(D) A majority of the members of the board of the federal association, which majority shall consist of not less than three directors, a majority of whom are citizens of the United States, shall subscribe to, acknowledge, and file articles of incorporation in the office of the secretary of state. Two copies of the articles shall be filed with the federal home loan bank board. The articles shall set forth all of the following:

(1) All statements required by divisions (A)(1), (2), and (3) of section 1701.04 of the Revised Code and any desired provision authorized by divisions (B)(3), (4), and (5) of that section;

(2) A statement showing that the state association is incorporated by conversion or reorganization from the federal association;

(3) A statement showing the assumption by the state association of all shares, accounts, and liabilities of the federal association as of the date on which the conversion or reorganization is to be completed, and the manner in which each class of such shares, accounts, and liabilities will be discharged or adjusted by the state association.

Upon receipt of the articles, the secretary of state shall forthwith transmit to the superintendent a copy of the articles. If it appears that the state association, if formed, will be entitled to commence the business for which it is organized, the superintendent shall so certify to the secretary of state, who shall record the articles upon that certificate.

(E) On the day and hour of such recording, the federal association shall be deemed converted or reorganized into the state association, and upon that conversion or reorganization, both of the following apply:

(1) All the federal association's property and assets, and every right, privilege, and interest then existing, belonging or pertaining to it or which would inure to it, immediately, without any conveyance or transfer and without any further act, shall be vested in and become the property of the successor state association, which shall hold and enjoy them in its own right, to the same extent as they were held and enjoyed by the federal association. All liens upon the property and assets of the federal association existing at the time of conversion shall be preserved unimpaired and limited in lien to the property or assets then affected by liens. This section does not deprive any person, firm, or corporation of any substantive right existing at the time of conversion against the federal association, nor of the right to enforce any such right of that nature by proceedings against the property and assets transferred by operation of this division, in the event and to the extent that the substantive right is not satisfied or adjusted by the successor state association in accordance with its articles.

(2) The state association shall commence business and shall be subject to the laws of this state relating to domestic savings and loan associations.

Any action or proceeding pending by or against the federal association at the time of the conversion or reorganization may be prosecuted to judgment, with right of appeal, as in other cases, as if the conversion or reorganization had not taken place, or the successor state association may be substituted for the federal association.

A copy of the articles recorded in the office of the secretary of state, certified by the secretary of state under the seal of the secretary of state's office and showing the day and hour of recording, shall be recorded in the office of the county recorder of the county in which the federal association had its principal office or place of business at the time of its conversion or reorganization and in each county in the state in which the federal association owned real estate at the time of its conversion or reorganization, for which recording the recorder shall charge the same fees as for the recording of deeds. Two copies of the articles, as so recorded and certified and showing the date and hour of the recording, shall be filed with the federal home loan bank board.

Effective Date: 03-17-2000

1151.39 Filing and recording of papers concerning federal association.

Any federal savings and loan association having its home office in this state may file in the office of the secretary of state a copy of its charter or any amendment thereto, or any resolution or other paper evidencing a merger, reorganization, dissolution, or liquidation, if the document filed is certified by the authority issuing it. For such filing the secretary of state shall charge and collect a fee of five dollars. A copy of such document, as filed in the office of the secretary of state, certified by him under the seal of his office and showing the day and hour of filing, shall be recorded in the office of the county recorder of the county in which the association had its home office or place of business at the time of such filing, and may be filed in the office of the recorder of any county in which such association owned real estate at the time of such filing. For such recording the recorder shall charge the same fees as for the recording of deeds.

Effective Date: 10-01-1953

1151.40 Powers of association when in dissolution or receivership.

The powers granted and limited in sections 1151.36 and 1151.37 of the Revised Code may be exercised, with the approval of the court which appointed the receiver, by a building and loan association which is in the course of voluntary dissolution or in receivership.

Effective Date: 10-01-1953

1151.41 Insurance of stock and deposits.

(A) A savings and loan association may do all things necessary or proper to obtain the insurance of its stock, shares, certificates of deposit, or deposit accounts, by the federal savings and loan insurance corporation under the "National Housing Act" and amendments thereto, or as may be hereafter provided by law.

(B) No savings and loan association shall be certified by the superintendent of savings and loan associations for the commencement of business in this state, nor, except as provided in division (D) of this section, shall an association transact business in this state, unless its accounts are insured by the federal savings and loan insurance corporation.

(C) Every state-chartered association whose accounts, on the effective date of this amendment, are insured by the federal savings and loan insurance corporation shall maintain such insurance as a condition of doing business in this state.

(D) Notwithstanding any other provision of the Revised Code or any other law, any state-chartered association that was transacting business in this state on March 20, 1985, and whose accounts were not insured by the federal savings and loan insurance corporation may continue to transact business in this state without such insurance.

Effective Date: 07-14-1987

1151.411 Notice of noninsured status.

(A) Every state-chartered savings and loan association that, on the effective date of this section, is doing business in this state but whose accounts or deposits are not insured or guaranteed by the federal savings and loan insurance corporation or another government or government-sponsored agency shall post a notice which shall be in a conspicuous place at each public entrance to its place of business and be in the following form: "THE ACCOUNTS OF THIS ASSOCIATION ARE NOT INSURED BY THE FEDERAL SAVINGS AND LOAN INSURANCE CORPORATION (FSLIC), NOR ARE THE DEPOSITS OR ACCOUNTS OF THIS ASSOCIATION INSURED OR GUARANTEED BY ANY OTHER GOVERNMENT OR GOVERNMENT-SPONSORED AGENCY."

(B) The portion of the notice required by division (A) of this section relating to accounts not insured by the federal savings and loan insurance corporation shall be in letters at least one inch in height, and the remainder of the notice shall be in letters at least one-half inch in height.

Effective Date: 07-14-1987

1151.42 Purchase and sale of loans.

A building and loan association may buy obligations representing loans which would be legal loans if originated by the association. Such investments may be held and reported as other investments of the same type.

An association may sell, with or without recourse, any loan.

Effective Date: 12-09-1982

1151.43 [Repealed].

Effective Date: 09-25-1969

1151.44 Change of name, authorized capital, or par value of shares.

A building and loan association may change its name by a majority vote of its board of directors. Associations, other than those described in section 1151.081 of the Revised Code, may increase or decrease its authorized capital or the face value of its shares by a majority vote of its board of directors. A certificate of any such action shall be made by the president and the secretary of the association and filed with the secretary of state, after which, in the use of the changed stock or changed name, all rights of all parties shall remain the same as before such change was made.

Effective Date: 11-17-1969

1151.45 Dissolution.

A building and loan association may dissolve by a majority vote of the stock entitled to be voted under its constitution. Such vote shall be consistent with section 1151.20 of the Revised Code, and such dissolution shall be subject to the contract rights of the association's borrowers and the vested rights of its members.

No such association shall dissolve until after it has filed an application to dissolve with the superintendent of building and loan associations and said superintendent has consented in writing to such dissolution and certified, upon examination of said association, that it is in a safe and sound condition.

Upon receipt of such consent and certificate, the association may file in the office of the secretary of state a certificate signed by the president or a vice-president, and by the secretary or an assistant secretary of the association, verified by an oath of the signers stating the name of the corporation; the place where its principal office is located; the names and post-office addresses of its directors and officers, and if any such address is in a city, the street and number or other particular description thereof; that it elects to wind up and dissolve; and that such signers have been authorized to execute and file such certificate by a resolution adopted as provided in this section.

Before such certificate is filed, the approval of the superintendent shall be indorsed on it.

After the filing of said certificate, all proceedings relating to the dissolution of such association shall be governed by sections 1701.87 and 1701.88 of the Revised Code.

Unclaimed share accounts, deposits, dividends, and other intangible property of a building and loan association dissolved under this section that remain in the hands of the liquidators for a period of six months after the certificate of dissolution has been filed in the office of the secretary of state shall be reported as unclaimed funds pursuant to sections 169.03 and 169.05 of the Revised Code, except that division (D) of section 169.03 of the Revised Code does not apply.

Effective Date: 10-16-1972

1151.46 Amendment of articles and constitution.

A building and loan association may amend its articles of incorporation and its constitution, and may increase or decrease the number of its directors by complying with the requirements of its own constitution for the amendment thereof. The officers of such association shall be such as its constitution provides.

The constitution of a building and loan association which has no permanent stock may provide for the amendment of its articles of incorporation and its constitution by providing that such articles of incorporation or constitution may be amended at any meeting of the members for which notice has been properly given in accordance with section 1151.11 of the Revised Code and such amendment is adopted by at least a three-fifths vote of the votes cast in person or by proxy at the meeting so called. The number of votes which each member may cast shall be determined by such constitution. Regardless of any provisions in its existing constitution for the amendment thereof or the lack of any such provision, such a building and loan association may adopt such a provision for the amendment of its articles of incorporation and its constitution at any meeting authorized in writing by a majority of its members of record held upon written notice made in accordance with section 1701.41 of the Revised Code stating the proposed action to be taken at such meeting in a form approved by the superintendent of building and loan associations by a two-thirds vote of the votes cast authorizing such meeting provided that a majority of the members of record is present in person or by proxy at such meeting.

Effective Date: 01-23-1963

1151.47 Constitution and bylaws - amendments.

A building and loan association may provide, by a constitution adopted by its members and bylaws adopted by its board of directors, for the proper exercise of the powers granted in sections 1151.02 to 1151.55 , inclusive, of the Revised Code, and for the conduct and management of its affairs.

Proposed amendments to the constitution and bylaws shall be submitted to the superintendent of building and loan associations for approval on forms prescribed by him. The superintendent shall approve or disapprove such amendments and notify the association of his action within ninety days from the time received by him. If the superintendent disapproves of such amendment, he shall state the reasons therefor in his notice of disapproval.

Such association has all other powers necessary and proper to enable such association to carry out the purpose of its organization.

Effective Date: 08-09-1963

1151.471 Borrowers may be members.

The constitution of a building and loan association may provide that all borrowers from the association are members and provide for voting rights for such members at annual or special meetings of shareholders.

Effective Date: 11-02-1959

1151.48 Deposit of funds in banks.

The board of directors of a building and loan association shall designate the banks in which it shall deposit the funds of the association in the association's name. Such funds, after being so deposited, can be withdrawn only in such manner and for such purpose as is provided in the bylaws of the association and authorized by law. Such board may designate a sum to be kept in the offices of the association for the transaction of current business. All bank books showing such deposits shall be open to the inspection of any director of such association at any time.

Effective Date: 08-09-1963

1151.49 Bond of officers and employees.

All officers and employees of a building and loan association, before entering upon the discharge of their duties, shall be covered by an individual, schedule, or blanket fidelity bond in favor of the building and loan association in an amount required by, and with terms and surety approved by, the board of directors of the association. In case an individual bond is used, the officer or employee may have as surety thereon two or more responsible freeholders approved by the superintendent of building and loan associations or a surety company qualified to transact business in this state.

The superintendent or the board may require an increase in the amount of any such bond. Each such bond shall be for the protection of the association against losses resulting from the commission by its bonded officers or employees of any of the acts prohibited by sections 1151.16 , 2913.02 , 2913.31 , and 2913.42 of the Revised Code, or of any other dishonest act. The directors as such shall not be required to give bond.

Directors of the association to which bond is given shall not be eligible as bondsmen on such bond, but shall be individually liable for any loss to members of the association caused by the neglect of such directors to carry out the duties imposed upon them by law or by the constitution and bylaws of such association.

Effective Date: 07-01-1996

1151.50 [Repealed].

Effective Date: 11-22-1973

1151.51 Accounting procedure in certain transactions.

All expenses of a building and loan association shall be paid out of its gross earnings only, and so much of such earnings as is necessary must be set aside each year for such purpose. If the association acquires real estate as a result of default in a mortgage, whether by deed or by foreclosure, amounts paid out by it in court costs and taxes at the time such real estate is acquired may be charged to a reserve fund, and reconditioning costs after such real estate is acquired may be charged either to a reserve fund or to current operating expense, as determined by the board of directors. When any parcel of such real estate is sold by the association, the funds received shall be applied to the payment of sales expense, to the restoration of losses previously charged to the reserve or undivided profit funds, to the reduction of the book value of such real estate, or to current income, as determined by the board. The association may levy a reasonable charge, upon any corporation or person applying for a mortgage loan for which such real estate is given as security, for any services by it in connection with the loan or for extending the period of maturity of the loan or otherwise readjusting or refinancing it and for any other action by the association permitted or required by law with respect to such loans. All such charges, except reasonable attorneys' fees and charges for legal services and reasonable appraisal fees, must be made by the association directly and accounted for on its books. A reasonable appraisal fee may be charged by the association, and shall be paid by the borrower to the association prior to or subsequent to the granting of a loan.

Upon the closing of the loan, the association shall, directly or through its attorney, furnish the borrower a loan settlement statement showing in detail all charges and fees the borrower has paid or obligated himself to pay either to the association or to its attorney in connection with such loan; and a copy of such loan settlement statement shall be retained in the records of the association.

Effective Date: 08-09-1963

1151.52 Dividend or interest payments.

After provision for payment of expenses, interest, and the maintenance of the loss reserve and other net worth accounts as required by section 1151.33 of the Revised Code, an association may declare dividends on withdrawable share accounts and pay interest on deposits. Such dividends or interest may be credited to the account or paid to the holder thereof at such times, such rates, and upon such methods of computation as are authorized by a resolution of the board of directors of the association.

If dividends or interest are to be credited or paid at more than one rate, the resolution authorizing such rates shall set forth the criteria for determining the classes of accounts which will receive the various rates. Such criteria may include the balance in the account at a specified time or times, the period of time a minimum balance must be maintained, the type of evidence of ownership issued to the owner of the account, and other similar standards or combinations thereof. Each account shall receive dividends or interest at the rate to which it is entitled based upon the criteria set forth in the resolution, except that the board of directors may establish minimum account balances upon which dividends or interest are paid. Any residue of such earnings not credited to reserves and not declared as dividends, may be held as undivided profits and used as other earnings.

Effective Date: 12-09-1982

1151.521 [Repealed].

Effective Date: 04-10-1967

1151.53 Losses.

All losses of a building and loan association shall be met by the application thereto of the following, in the order listed:

(A) The loss reserve and other net worth accounts provided for in section 1151.33 of the Revised Code, in part to one or more of such accounts in such manner and in such amounts as shall be determined by the board of directors;

(B) The capital stock.

Effective Date: 06-13-1975

1151.54 Appraisal of real estate and delinquent mortgages.

At least once in every three years the appraisal committee of each building and loan association or a qualified appraiser appointed by the board of directors shall appraise all real estate owned by the association and report its findings to the superintendent of building and loan associations and to the board of directors of the association in such form as is required by division (F) of section 1151.292 of the Revised Code. Whenever interest due such an association on account of any mortgage loan carried on its books remains overdue and unpaid for one year, the security property shall be reappraised forthwith unless an appraisal thereof has been made within the preceding twelve months, and a report shall be made of its findings on such appraisal to the board.

Effective Date: 12-09-1982

1151.55 Impairment of capital or overvaluation of assets.

Whenever, from an examination or otherwise, it appears to the superintendent of building and loan associations that the capital of any building and loan association is impaired, or that such association is carrying on its books assets in excess of their fair value, he may, upon written notice by registered mail to such association, and at the expense of the association, cause any of such association's assets designated by him to be appraised by two competent disinterested persons, one of whom shall be selected by the superintendent and one by a vote of the majority of the board of directors of the association. If the board fails to act within ten days of the receipt of such notice, it thereby forfeits its right to make such selection, and the superintendent shall select both appraisers. If the two appraisers selected fail to agree upon an appraisal, they shall select a third appraiser, and the decision of two of the three appraisers shall be the appraisal. If the two appraisers first selected fail within ten days after their disagreement to select the third appraiser, he shall be selected by the superintendent, or, at the option of the association, by the presiding judge of the court of common pleas of the county in which such assets are located. If such association fails to exercise this option within ten days after the two appraisers first selected fail to agree upon the third appraiser, the superintendent shall make the selection. In case three appraisers are appointed, two of them must be residents of the county in which the assets appraised are located. The compensation of all such appraisers shall be fixed by the superintendent.

Such appraisers shall proceed forthwith to estimate the value of all such assets, and shall report their findings in writing on forms which include all items prescribed by the superintendent. Two copies of such report shall be sent to the superintendent and one to the association.

If the association is aggrieved at any of the findings of the appraisers, it may, within fifteen days thereafter, file in the court of common pleas in the county in which such association is located, an action praying for an amendment of the appraisal. Thereupon the court, upon the hearing, shall make a finding as to the fair value the appraisers should have found which decision shall be final.

If the appraised value of the assets, ascertained under this section, is less than the book value of such assets on the books of the association, the difference shall constitute a loss to be met in the manner provided by section 1151.53 of the Revised Code, and the board shall, on receipt of the findings of the appraisers, adjust the books of the association in accordance with such findings, unless such loss is otherwise compensated for to the satisfaction of the superintendent.

Effective Date: 10-01-1953

1151.60 Acquisitions and mergers.

(A)

(1) A savings and loan association organized under the laws of this state may acquire or merge with a domestic association, a foreign savings association, a foreign federal association, a savings bank, a foreign savings bank, a state bank, a national bank, or a bank organized under the laws of another state, upon application to and written approval of the superintendent of financial institutions.

(2) For purposes of division (A)(1) of this section, if the surviving institution or new institution is a savings and loan association organized under the laws of this state, section 1701.82 of the Revised Code governs the merger or consolidation, except that after the merger or consolidation becomes effective, the surviving or new institution shall possess, of a public and private nature, the rights, privileges, immunities, powers, franchises, and authority of a savings and loan association organized under the laws of this state.

(B) A savings and loan association organized under the laws of this state may merge with a holding company affiliate upon application to and written approval of the superintendent. The superintendent shall approve such a merger only if the superintendent is of the opinion that the rights of all interested parties are protected.

(C) The limitations and conditions of Chapter 1701. of the Revised Code do not apply to a merger of a savings and loan association, the outstanding capital of which consists entirely of withdrawable shares, or which is organized under section 1151.081 of the Revised Code, provided that the plan of merger is approved by a two-thirds vote of the association's board of directors as evidenced by a merger agreement. Upon written notice to the association's board of directors, the superintendent may require that the plan of merger be submitted to the shareholders for approval in accordance with the provisions of Chapter 1701. of the Revised Code.

(D) The superintendent shall adopt rules in accordance with Chapter 119. of the Revised Code setting forth criteria that must be met for the merger of a savings and loan association and a holding company affiliate that is not a savings and loan association, a bank, or a savings bank.

(E) For purposes of this section, upon the consolidation or purchase of substantially all of the assets and assumption of liabilities of a savings and loan association, the superintendent, at the superintendent's discretion, may direct the secretary of state to cancel the articles of incorporation.

(F) For purposes of this section:

(1) "Holding company affiliate" means a savings and loan holding company of which a savings and loan association is a subsidiary and any other subsidiary of such holding company other than a subsidiary of such association.

(2) "Merger" includes consolidation and the purchase of substantially all of the assets and assumption of liabilities of another institution. "Merger" includes the use of an interim savings association.

Effective Date: 05-21-1997

1151.61 Reorganization.

A savings and loan association may be reorganized, with the written consent of the deputy superintendent of savings and loan associations, in the following manner:

(A) The board of directors may adopt a plan of reorganization, which may include any change in the articles of incorporation, including changes of issued or unissued shares, which could be effected by amendment to the articles, except as otherwise provided in this section; the increase or reduction of the authorized capital stock, the stock credits, and the fully paid and issued capital stock; the determination or redetermination of the fair value to the association of its tangible or intangible assets; the allotment of a part of the amount so determined or redetermined to stock credits and to fully paid and issued capital stock, and a part to the reserve fund; the retention as reserve and undivided profits of any of the existing reserve and undivided profits; the manner, terms, and basis of converting or exchanging shares; and any other details that the board considers necessary or desirable. The board shall not adopt, and the superintendent shall not approve, any plan that, by amendment to the articles or otherwise, changes the purpose of the association from that of a savings and loan association within the meaning of section 1151.01 of the Revised Code.

(B) A special meeting of the stockholders shall be called, of which notice shall be given to each stockholder at the stockholder's last known post-office address as it appears on the records of the association, whether or not the stockholder is entitled to vote. At such meeting, the plan of reorganization, including any amendments of or additions to the plan proposed at the meeting, shall be considered, and a vote shall be taken on the question of its adoption. The adoption of the plan requires the vote, in person or by proxy, of the holders of fifty-one per cent of the stock. If the plan so provides, the board, within forty-five days after the day on which the vote is taken, may rescind the action of the shareholders if in its judgment the consummation of the plan will be against the best interests of the association because of the number of dissenting shareholders or the amount of stock owned by them.

(C) All shareholders dissenting from such plan are entitled to relief in the manner and under the conditions provided in section 1701.85 of the Revised Code, except that when the plan includes only a reduction in the authorized capital stock, in the stock credits, and in the fully paid and issued capital stock, the filing of the dissenting shareholder's demand for payment of the fair cash value of the dissenting shareholder's stock credits shall constitute an application for withdrawal or repurchase, and the fair cash value of the dissenting shareholder's stock credits as finally determined in accordance with that section shall be payable only at the times that are permitted under the dissenting shareholder's right of withdrawal or repurchase at the time such an application is filed.

(D) The plan shall become effective when it has been adopted by the shareholders and approved in writing by the superintendent, and the president or a vice-president, and the secretary or an assistant secretary, of the association have signed and filed in the office of the secretary of state a certificate of reorganization, with the consent of the superintendent endorsed on the certificate, containing a copy of the plan of reorganization, and also containing the following items, unless the item in question is included in the plan:

(1) All statements required by divisions (A)(1), (2), and (3) of section 1701.04 of the Revised Code to be included in the original articles of incorporation, and any provisions authorized by divisions (B)(3), (4), and (5) of that section which are to remain in effect or to be included as part of the plan;

(2) A statement of the amount of fully paid and issued capital stock, the amount of stock credits, and the amount of authorized capital stock, both before and after the reorganization.

(E) An association whose plan of reorganization is disapproved by the superintendent, within thirty days after the disapproval and by leave of court first obtained, may file, in the court of common pleas of Franklin county or of the county in which the association has its principal place of business, an action against the superintendent, alleging the facts upon which it relies for a reversal of the superintendent's action and praying for such a reversal. The action of the superintendent shall not be reversed unless the court finds that the superintendent exceeded the superintendent's power or abused the superintendent's discretion in disapproving the plan.

No order of court shall restrain the superintendent from making an examination of the association and its affairs at any time under sections 1155.09 and 1155.10 of the Revised Code.

Effective Date: 03-17-2000

1151.62 Sale or transfer of substandard or unacceptable assets.

With the written consent of the superintendent of building and loan associations, but not otherwise, the board of directors of a building and loan association, in order to obtain the insurance of its stock, stock credits, certificates of deposit, or deposit accounts, or to improve or sustain its financial conditions or operations, may adopt a plan providing for the sale or transfer of substandard or unacceptable assets to a corporation organized under the laws of this state or to trustees, for the purpose of liquidating such assets in an orderly manner, for such consideration as is provided in said plan which may include money, stock, bonds, certificates of beneficial interest, or other property or consideration, or a combination thereof, paid or issued by the corporation or trustees to which such assets are sold or transferred, and providing for the distribution of such consideration in cash or in kind, or in both, to the shareholders of the association or to other persons entitled thereto, according to their respective rights, after paying or adequately providing for the payment of the liabilities of said association.

Such plan shall provide for a reduction or adjustment of the stock and stock credits of the association in the amount and to the extent required to accomplish the purposes set forth in the plan. It may provide for participation in the plan and in such consideration by the holders of certificates of deposit or deposit accounts through the voluntary surrender or reduction of their holdings.

The plan shall set forth a statement of the fully paid and issued capital stock, the stock credits, and the authorized capital stock, both before and after the adoption of such plan.

The corporation or trustees to which such assets are sold or transferred shall, with respect to such assets, be subject to supervision and examination by the superintendent. The written consent of the superintendent or of his deputy must be secured to validate any act done or power exercised by such corporation or trustees in the liquidation of such assets. Such corporation or trustees shall make reports to the superintendent on the first day of January and the first day of July of each year, or oftener if required by him, containing such information as to such assets as he requires.

A special meeting of the stockholders shall be called and held as provided by section 1151.61 of the Revised Code, and the adoption of such plan shall require the vote, in person or by proxy, of the holders of fifty-one per cent of the stock.

If the plan so provides, the board may, within forty-five days after the day on which such vote is taken, rescind the action of the shareholders if in its judgment the consummation of the plan will be against the best interests of the association because of the number of dissenting shareholders or the amount of stock owned by them.

All shareholders dissenting from such plan shall be entitled to relief in the manner and under the conditions provided by section 1151.61 of the Revised Code.

Such plan shall become effective, without the necessity of any further corporate proceedings, as an amendment to the articles of incorporation, when it has been adopted by the shareholders and approved in writing by the superintendent, and the president or a vice-president, and the secretary or an assistant secretary, of the association have signed and filed in the office of the secretary of state a certificate showing the adoption of such plan, with the consent of the superintendent indorsed on such certificate, and containing a copy of the plan.

Effective Date: 10-01-1953

1151.63 Dissolution or consolidation.

(A) A savings and loan association may provide in its constitution and bylaws for the time and terms of its dissolution and for its consolidation with other such associations on terms to be determined upon by its board of directors. In case of the dissolution of such an association, its board of directors, by a majority vote of its members, may be authorized to sell and transfer its mortgage securities or other property, or both, to another corporation or person, subject to the vested and accrued rights of the mortgagors.

(B) A savings and loan association may provide for its consolidation with a holding company affiliate on terms to be determined by its board of directors, provided that the superintendent of savings and loan associations determines that the rights of all interested parties are protected and approves the consolidation. The superintendent shall adopt rules in accordance with Chapter 119. of the Revised Code setting forth criteria that must be met for a consolidation of a savings and loan association and a holding company affiliate.

(C) For purposes of this section, "holding company affiliate" means a savings and loan holding company of which a savings and loan association is a subsidiary and any other subsidiary of such holding company other than a subsidiary of such association.

Effective Date: 07-14-1987

1151.64 Conversion of bank or savings bank into savings and loan association.

(A) A bank organized under the laws of this state or a savings bank with permanent stock and organized under Chapter 1161. of the Revised Code may convert into a savings and loan association by following the procedures prescribed by divisions (B), (C), and (D) of this section.

(B)

(1) The board of directors shall adopt a resolution fixing the time and place of holding a special meeting of the shareholders and shall cause not less than twenty days' written notice of the time, place, and purpose of the meeting to be given to each shareholder, either personally or by mail, directed to him at his last known address appearing upon the records of the corporation.

(2) At the meeting, a resolution to make the conversion shall be adopted. The resolution shall amend the articles of incorporation to provide that the institution shall be organized under Chapter 1151. of the Revised Code as a savings and loan association, and, if necessary, to change the name of the institution. The amended articles shall contain the provisions required by Chapter 1151. of the Revised Code.

(3) Within one week after the date of the shareholders' meeting, copies of the resolution of the board and of the minutes of the meeting of shareholders, together with a statement showing the giving of notice, all verified by an affidavit of the president or a vice-president and of the secretary or an assistant secretary or cashier or assistant cashier, shall be filed in the office of the superintendent of savings banks or the superintendent of banks and the office of the superintendent of savings and loan associations, and the amendment to the articles of incorporation shall be delivered to the superintendent of savings and loan associations.

(C) Upon receipt of the documents referred to in division (B)(3) of this section, the superintendent of savings and loan associations shall immediately make such inquiry as is necessary to determine whether all of the following conditions are satisfied:

(1) The articles of incorporation as amended comply with Chapter 1151. of the Revised Code.

(2) The requirements of this section have been met.

(3) The institution upon the filing of the amended articles with the secretary of state will be able to commence operations as a savings and loan association as defined in section (3)(b) of the "Federal Deposit Insurance Act," 64 Stat. 873 (1950), 12 U.S.C. 1813(b) .

(D) Within sixty days after the receipt of the documents referred to in division (B)(3) of this section, the superintendent of savings and loan associations shall approve or disapprove the amended articles of incorporation. Notwithstanding any other provision of the Revised Code, if the superintendent fails to act within the sixty-day period, the amended articles shall be deemed approved, and the institution shall forward a copy of such amended articles to the secretary of state who shall file the amended articles and furnish a certified copy to the institution and to the superintendent. If the superintendent approves the amended articles, he shall prepare a certificate to this effect and forward the certificate and the amended articles to the secretary of state. Upon receipt of the certificate and amended articles, the secretary of state shall file the amended articles and furnish a copy, certified by him, to the institution. Thereupon, the articles shall be deemed amended.

(E) An amendment to the articles of incorporation described in divisions (B), (C), and (D) of this section shall not require the approval of the superintendent of savings banks or the superintendent of banks.

(F) A national bank that is located in this state may convert into a savings and loan association upon following the procedures of divisions (B), (C), and (D) of this section, except that no documents need be filed with the superintendent of savings banks or the superintendent of banks, and provided that the bank complies with the applicable provisions of federal law.

(G) Notwithstanding any other provisions of law or of its articles of incorporation or constitution, a savings bank without permanent stock organized under the laws of this state may convert to a savings and loan association without permanent stock by following all of the procedures prescribed in this division:

(1) The board of directors shall adopt a resolution to amend the articles of incorporation, which shall require approval by a two-thirds vote of the institution's board of directors unless the articles of incorporation provide otherwise by specific reference to division (G) of this section, and require a vote of members or a different vote of directors. The resolution shall amend the articles of incorporation to provide that the institution shall be organized under Chapter 1151. of the Revised Code as a savings and loan association and, if necessary, to change the name of the institution. The amended articles shall contain the provisions required by Chapter 1151. of the Revised Code.

(2) Within one week after the date of the director's meeting or member's meeting, if required, copies of the resolution of the board of directors or of the members and of the minutes of the director's or member's meeting, together with a statement showing the giving of notice, all verified by an affidavit of the president or a vice-president and of the secretary or assistant secretary or cashier or assistant cashier, shall be filed in the office of the superintendent of savings banks and in the office of the superintendent of savings and loan associations, and the amendment to the articles of incorporation shall be delivered to the superintendent of savings and loan associations.

(3) Upon receipt of the documents referred to in division (G)(2) of this section, the superintendent of savings and loan associations shall immediately make such inquiry as is necessary to determine whether all of the following conditions are satisfied:

(a) The articles of incorporation comply with Chapter 1151. of the Revised Code.

(b) The requirements of this section have been met.

(c) The institution upon filing the amended articles of incorporation with the secretary of state will be able to commence operations as a savings and loan association as described in section (3)(b) of the "Federal Deposit Insurance Act," 64 Stat. 873 (1950), 12 U.S.C. 1813(b) .

(4) Within sixty days after the receipt of the documents referred to in division (G)(2) of this section, the superintendent of savings and loan associations shall approve or disapprove the amended articles of incorporation. Notwithstanding any other provision of the Revised Code, if the superintendent fails to act within the sixty-day period, the amended articles shall be deemed approved, and the institution shall forward a copy of the amended articles to the secretary of state who shall file the amended articles and furnish a certified copy to the institution and to the superintendent. If the superintendent approves the amended articles, he shall prepare a certificate to this effect and forward the certificate and the amended articles to the secretary of state. Upon receipt of the certificate and the amended articles, the secretary of state shall file the amended articles and furnish a copy, certified by him, to the institution. Thereupon, the articles shall be deemed amended.

(5) An amendment to the articles of incorporation described in this division shall not require the approval of the superintendent of savings banks.

Effective Date: 10-23-1991

1151.66 Prior written approval of acquisition of controlling interest.

Except as provided in section 1151.60 of the Revised Code, no person or entity shall, directly or indirectly, acquire a controlling interest in a savings and loan association without the prior written approval of the superintendent of savings and loan associations. The superintendent shall adopt rules, in accordance with Chapter 119. of the Revised Code, to carry out the purposes of this section, except that prior to adoption of such rules, a person or entity may acquire a controlling interest in a savings and loan association with the prior approval of the superintendent.

Effective Date: 10-23-1991

1151.71 Foreign savings and loan chartering or acquiring Ohio savings and loan.

(A) Notwithstanding any other provision of the Revised Code, no savings and loan association incorporated under the laws of any other state or having its main office or principal place of business in any other state shall receive deposits in this state, except as provided in sections 1151.052 , 1151.053 , and 1151.60 of the Revised Code.

(B) A savings and loan association or savings and loan holding company with its main office or principal place of business in another state may charter or otherwise acquire an Ohio savings and loan association or Ohio savings and loan holding company.

(C)

(1) Any savings and loan association or savings and loan holding company proposing to charter a state savings and loan association pursuant to the authority granted by this section shall make application pursuant to and be bound by the requirements of this chapter and the rules adopted thereunder.

(2) Any savings and loan association or savings and loan holding company proposing to acquire an Ohio savings and loan association or Ohio savings and loan holding company pursuant to this section shall comply with section 1151.66 of the Revised Code. An application filed pursuant to that section shall consist of a copy of the application filed with the appropriate regulator under federal law and evidence that its accounts or the accounts of its insured depository institution subsidiaries are insured by the federal deposit insurance corporation. If no application is required to be filed under federal law, the application shall contain such other information as the superintendent may prescribe, by rule, as necessary or appropriate for the purpose of making a determination under this section and section 1151.66 of the Revised Code. Withdrawal from the federal deposit insurance corporation terminates the authority of the foreign savings and loan association or savings and loan holding company to do business in Ohio and voids any certificate or approval issued under this section.

As used in this section:

(1) "Acquire" or "acquisition" means either of the following transactions or actions:

(a) The acquisition of the direct or indirect ownership or control of voting shares of an Ohio savings and loan holding company or an Ohio savings and loan association if, after such acquisition, the acquiring savings and loan association or savings and loan holding company will be a controlling person of the savings and loan association or the savings and loan holding company;

(b) The taking of any other action that results in the direct or indirect control of an Ohio savings and loan association or Ohio savings and loan holding company.

(2) "Ohio savings and loan association" means a domestic association as defined in section 1151.01 of the Revised Code.

(3) "Savings and loan holding company" means any company that is a savings and loan holding company as defined in 12 C.F.R. Section 583.20 , as amended, promulgated pursuant to section 10 of the "Home Owners' Loan Act of 1933," 48 Stat. 128, 12 U.S.C.A. 1467a , as amended, or that will become such an approved savings and loan holding company prior to or upon completion of the acquisition to be made pursuant to the authority granted by this section, and includes a bank holding company as defined in 12 C.F.R. section 225.2 promulgated pursuant to section 2 of the "Bank Holding Company Act of 1956," 70 Stat. 133, 12 U.S.C.A. 1841 , as amended.

(4) "Ohio savings and loan holding company" means a savings and loan holding company that owns or controls one or more Ohio savings and loan associations and has its principal place of business in this state.

(5) "Principal place of business" means, as to a savings and loan association, the state in which its main office is located, and as to a savings and loan holding company, the state or jurisdiction in which the total deposits of all direct and indirect insured depository institution subsidiaries of the holding company and any other company that has control of the holding company are the largest, as shown in the most recent report of condition or similar report filed by insured depository institution subsidiaries with state or federal authorities.

(6) "Insured depository institution" has the same meaning as in the "Federal Deposit Insurance Act," 64 Stat. 873 (1950), 12 U.S.C. 1811 , 1813 , as amended.

Effective Date: 05-21-1997

1151.72 Examining acquiring institution.

(A) When the superintendent of savings and loan associations considers it necessary or appropriate, he may examine any savings and loan association or savings and loan holding company that has acquired or has an application pending to acquire an Ohio savings and loan association or Ohio savings and loan holding company pursuant to the authority granted by division (B) of section 1151.71 of the Revised Code. The cost of an examination shall be assessed against and paid by the savings and loan association or savings and loan holding company examined. The assessment for an examination shall be the same as for a special examination under Chapter 1155. of the Revised Code plus documented extraordinary expenses. The superintendent may request the savings and loan association or savings and loan holding company to be examined pursuant to this division to advance the estimated cost of such examination.

(B) The superintendent may enter into cooperative agreements with other state and federal savings and loan regulatory authorities to facilitate the examination of any savings and loan association or savings and loan holding company that has acquired or has an application pending to acquire an Ohio savings and loan association or Ohio savings and loan holding company pursuant to the authority granted by division (B) of section 1151.71 of the Revised Code. The superintendent may accept reports of examinations and other records from such other authorities in lieu of conducting his own examination of such savings and loan associations or savings and loan holding companies. The superintendent may take any action jointly with other regulatory agencies having concurrent jurisdiction over such savings and loan associations or savings and loan holding companies or may take action independently in order to carry out his responsibilities under division (B) of section 1151.71 of the Revised Code.

(C) When the superintendent considers it necessary, he may require any savings and loan association or savings and loan holding company that has acquired an Ohio savings and loan association or Ohio savings and loan holding company pursuant to the authority granted by division (B) of section 1151.71 of the Revised Code to submit such reports to the superintendent as he determines to be necessary or appropriate for the purpose of carrying out his responsibilities.

(D) Any savings and loan association or savings and loan holding company that has acquired an Ohio savings and loan association or Ohio savings and loan holding company pursuant to the authority granted by division (B) of section 1151.71 of the Revised Code is subject to the proceedings brought by the superintendent pursuant to Chapter 1157. of the Revised Code.

(E)

(1) The approval of the superintendent is required for the declaration of dividends on permanent stock if the total of all such dividends declared by any Ohio savings and loan association or Ohio savings and loan holding company acquired pursuant to the authority granted by division (B) of section 1151.71 of the Revised Code in any fiscal year exceeds the total of its net profits of that year combined with its retained net profits of the preceding two years, less any required transfers to surplus or a fund for the retirement of any preferred stock.

(2) For the purposes of this division (E), "net profits" means the remainder of all earnings from current operations plus actual recoveries on loans and investments and other assets, after deducting from the total thereof all current operating expenses, actual losses, accrued dividends on preferred stock, if any, and all federal and state taxes, and "retained net profits of the preceding two years" means the increase in retained earnings during the immediately preceding two fiscal years after deducting all charges against retained earnings during such two years.

Effective Date: 10-17-1985

1151.80 to 1151.92 [Repealed].

Effective Date: 05-19-1985

1151.99 Penalty.

(A) Whoever violates section 1151.16 of the Revised Code shall be fined not more than one thousand dollars.

(B) Whoever violates section 1151.07 of the Revised Code shall be fined not more than five thousand dollars; each day of violation shall constitute a separate offense.

Effective Date: 12-11-1967