1246

LAWS OF MARYLAND

Ch. 166

BY repealing and reenacting, without amendments,

Article - Financial Institutions

Section 6-501

Annotated Code of Maryland

(1980 Volume and 1980 Supplement)

SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF
MARYLAND, That section(s) of the Annotated Code of Maryland
be repealed, amended, or enacted to read as follows:

Article - Financial Institutions

6-402.

(a)  Except as otherwise provided in this section, the
board of directors of a credit union may declare dividends
from its available net earnings at the close of any fiscal
year, after providing for accrued expenses, interest, and
taxes.

(b)   [The] THE BOARD OF DIRECTORS SHALL SET THE
dividend rate AND SHALL NOTIFY THE MARYLAND CREDIT UNION
INSURANCE CORPORATION AND SUPPLY A REPORT OF FINANCIAL
CONDITION WHENEVER THE DIVIDEND RATE IS CHANGED [may not
exceed 12 percent a year].

(c) (1) Dividends may be paid annually, semiannually,
quarterly, or daily, as the bylaws of the credit union
provide.

(2) Except for shares on which dividends are
paid daily, dividend credit for a month may be accrued on
shares that become full paid before the eleventh day of the
month.

(d)  A credit union may not declare a dividend:

(1)  Unless the required amount of earnings has
been credited to the reserve fund of the credit union; or

(2)  If the known losses at the close of a fiscal
year would exceed the sum of the balances of the reserve
fund, surplus, and undivided earnings after payment of the
dividend.

6-501.

Subject to the provisions of this subtitle, a credit
union may make loans to its members for the purposes and on
the terms as the bylaws provide.

SECTION 2. AND BE IT FURTHER ENACTED, That this Act
shall take effect July 1, 1981.