(1) Every savings association shall have on hand at all times cash and other assets readily convertible into cash having a value of not less than a percentage of its savings liability fixed by rule as necessary for the prudent conduct of the affairs of the association. The Director of the Department of Consumer and Business Services shall from time to time by rule define assets readily convertible to cash and fix the minimum percentage of the savings liability of any association that shall be used to determine the value of cash and other assets necessary to comply with this subsection. The director may consider an association to be in compliance with this section if the association satisfies applicable federal liquidity requirements for federally insured associations.
(2) Cash and assets readily convertible to cash, within the limits required by subsection (1) of this section, shall not be pledged or otherwise held as security for the payment of any obligation of the association.
(3) Unless an association is in compliance with subsection (1) of this section, it shall not make any loan or investment without the prior approval of the director, except:
(a) To invest in cash or other assets readily convertible to cash;
(b) To invest in a loan secured wholly by pledge of a savings account issued by the association; or
(c) To honor a loan commitment made prior to the association’s failure to meet the requirement of subsection (1) of this section. [1975 c.582 §91; 1981 c.472 §17]
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