Ch. 635

LAWS OF MARYLAND

(3) CERTIFY THESE ACTIONS TAKEN TO THE CREDIT UNION

INSURANCE CORPORATION SHARE INSURER.

9-1110 9-1109.

IN ADDITION TO MEMBERSHIP AUTHORIZED IN § 6-210 OF THIS
TITLE, A CREDIT UNION RESULTING FROM A CONVERSION UNDER THIS
SUBTITLE MAY PERMIT INDIVIDUALS WHO, AT THE TIME OF CONVERSION,
ARE MEMBERS, SAVINGS ACCOUNT HOLDERS, DIRECTORS, OFFICERS,
EMPLOYEES, OR BORROWERS OF A MUTUAL ASSOCIATION, TO BECOME
MEMBERS OF THE RESULTING CREDIT UNION.

SECTION 2. AND BE IT FURTHER ENACTED, That a credit union
resulting from a conversion of a mutual savings and loan
association may hold loans and investments in existence at the
time of conversion that do not conform with loans and investments
allowed under Title 6 of the Financial Institutions Article
except:

(1)  Any nonperforming loan which is in default, or
any loan that the Bank Commissioner determines is inadequately
secured.

(2)  Any loan or investment the Bank Commissioner
determines will jeopardize the safety and soundness of the
institution.

SECTION 3. AND BE IT FURTHER ENACTED, That, for purposes of
calculating the tax imposed on net earnings under Article 81, §§
128 and 128A of the Code and, after January 1, 1989, under Title
8, Subtitle 2 of the Tax - General Article, for a mutual
association converting under Title 9, Subtitle 11 of the
Financial Institutions Article, any amounts of previously allowed
bad debt reserve deductions that are, as a result of the
conversion, recaptured and included in taxable income for federal
income tax purposes shall be subtracted from the net income of
the association.

SECTION 4. AND BE IT FURTHER ENACTED, That, for the
purposes of this Act, the time a credit union is' in operation, as
used in § 6-602(c) of the Financial Institutions Article, shall
include the time that a credit union operated as a stock or
mutual savings and loan association prior to conversion to a
credit union under this Act.

SECTION 5. AND BE IT FURTHER ENACTED, That the 3 directors
of the Credit Union Insurance Corporation appointed by the
Governor under § 7-109(b)(2)(ii) of the Financial Institutions
Article shall continue to serve in office until July 1, 1988, at

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