N.Y. BNK Law § 387 — New York Code / Act BNK / Article 10 / Section 387
Credits to surplus account and undivided profits; dividends to shareholders
Status: in_force

§ 387. Credits to surplus account and undivided profits; dividends to\nshareholders. 1. When the net profits of any savings and loan\nassociation have been determined at the close of an accounting period,\nif its net worth does not equal ten per centum of its capital, such net\nprofits shall be credited to its surplus account in such amount as may\nbe determined by the superintendent of financial services until such net\nworth equals ten per centum of its capital. For purposes of this\narticle, the term "net worth" shall mean the excess of assets at book\nvalue, less allocated reserves, over known liabilities. The balance of\nsuch net profits, together with any amounts remaining from similar\nbalances for previous accounting periods, shall constitute the undivided\nprofits of such savings and loan association at the close of such\nperiod. The directors, in addition to the transfers to the surplus\naccount required by this section, may transfer additional amounts to\nsurplus account from undivided profits or continue to carry as undivided\nprofits such sum or sums as they may deem wise. Amounts heretofore\ncredited to a reserve for bad debts pursuant to chapter three hundred\nnine of the laws of nineteen hundred fifty-two shall be transferred to\nsurplus account.\n  2. The undivided profits of a savings and loan association at the\nclose of an accounting period shall be available for dividends. The\ndirectors may declare such dividends pursuant to the provisions of this\nparagraph or for any annual, semiannual, quarterly or monthly period\nclosing on the last day of a calendar month or as provided in paragraph\n(bb) of subdivision four of section three hundred seventy-eight of this\nchapter.  No association shall declare, credit or pay any dividend while\nits capital is impaired, or at any time except by a vote of the board of\ndirectors.\n  Notwithstanding the foregoing, in the event the gross income,\nundivided profits, surplus account or net worth of a savings and loan\nassociation shall be, or shall be deemed by the superintendent to be,\nincreased as a result of any loan, purchase of assets or guaranty by, or\nother transaction with, any insuror of the accounts of such savings and\nloan association, including a transaction subject to subdivision two of\nsection three hundred eighty-two-b of this article, the amount of any\nsuch increase in the gross income, undivided profits, surplus account or\nnet worth of such savings and loans association shall, with the prior\nwritten approval of the superintendent, be available for dividends.\n  4. Dividends shall be apportioned upon the dues and dividends credited\nto members, provided, however, that, except in the case of special\nsavings shares, no dividend shall be required to be computed and paid\nupon any dues credited to a member except from the first day of the\nmonth immediately following the date of receipt of such dues, and\nprovided further, that no dividend shall be required to be apportioned\non shares having a book value of less than fifty dollars or on savings\nshares issued for special purposes which by their terms are to be\nwithdrawn by the shareholder within one year from the date of their\nissuance. Any such association may compute dividends upon dues credited\nto a member from the date of actual receipt of such dues. The by-laws of\nany such association may provide a schedule of varying rates of\ndividends for different classes of shares and different types of shares\nwithin any class.\n  5. No savings and loan association shall declare any dividends upon\nthe accumulations on any share for a longer period than that during\nwhich such accumulations have been held; provided, however, that dues\npaid upon shares not later than the tenth day of any month, may have\ndividends declared thereon from the first day of the month in which such\npayment was made; and withdrawals of shares during the last three\nbusiness days of any dividend period or, in the event that one of such\nlast three business days is a Saturday, deposits withdrawn upon one of\nthe last four business days of any dividend period may receive dividends\napportioned for the full period.\n