3074                                 LAWS OF MARYLAND                               Ch. 856

THE BOARD OF DIRECTORS OF A SAVINGS AND LOAN
ASSOCIATION, BY RESOLUTION, SHALL DETERMINE AS TO DIVIDENDS
OR INTEREST ON SAVINGS ACCOUNTS:

(1)  THE RATE;

(2)  THE METHOD OF CALCULATION; AND

(3)  THE PAYMENT DATE.

(C) PAYMENT RESTRICTIONS.

DIVIDENDS OR INTEREST ON SAVINGS ACCOUNTS MAY BE PAID
ONLY FROM CURRENT EARNINGS, EARNED SURPLUS, THE EXPENSE
FUND, OR AS OTHERWISE PROVIDED IN THIS CODE.

COMMITTEE COMMENT: This section replaces former Art.
23, § 161FF(a) and (c) and CA § 6-222(a)(4).

Subsection (a) of this section makes clear that
earnings paid on savings deposit accounts are
interest.

Subsection (a)(2) of this section is a new
provision added to expressly provide authority
for what has been the practice, but previously
required expression in archaic terms and strained
meanings.

In subsection (c) of this section, the former
restriction against paying a dividend or
interest, until after the required allocation to
reserves, was deleted as being incorrect.
Dividends and interest are required to be paid
when due as a matter of contract whether or not
the reserves were met.

As to payment of dividends on capital stock, see
§ 9-322, "capital stock", of this title.

"Savings account" and "savings and loan
association" are defined in § 9-101 of this
title.

9-405. DIVIDEND OR INTEREST ON SAVINGS CERTIFICATE ACCOUNTS
OR OTHER FIXED TERM ACCOUNTS.

(A) IN GENERAL.

DIVIDENDS OR INTEREST ON A SAVINGS CERTIFICATE ACCOUNT
OR OTHER TYPE OF FIXED TERM ACCOUNT SHALL BE:

(1) SUBJECT TO THE APPROVAL OF THE BOARD OF
COMMISSIONERS; AND

(2) IN ACCORDANCE WITH THE RULES AND REGULATIONS
OF THE BOARD OF COMMISSIONERS.