AI-assisted research summary: The supervisor may not approve a charter application unless required findings are made, associations must secure and file proof of account insurance before starting business, and unauthorized insurance representations are prohibited.
58-10-12. Approval of application for charter. A. The supervisor shall not approve any charter application unless he affirmatively finds from the data furnished with the application, the evidence adduced at the public hearing and his official records that: (1) where applicable, the prerequisites set forth in Sections 3 through 9 [58- 10-3 to 58-10-9 NMSA 1978] of the Savings and Loan Act have been complied with and that the articles of incorporation comply with all other provisions of the Savings and Loan Act; (2) the character, responsibility and general fitness of the persons named in the articles of incorporation and the proposed board of directors command confidence and warrant belief that the business of the proposed association will be honestly and efficiently conducted in accordance with the intent and purpose of the Savings and Loan Act and that the proposed association will have qualified full-time management; (3) there is a public need for the proposed association and the volume of business in the area in which the proposed association will conduct its business indicates profitable operation; (4) the operation of the proposed association will not unduly harm any existing association; and (5) the association has applied for insurance of accounts with the federal savings and loan insurance corporation, an agency of this state or another federal agency established for the purpose of insuring savings accounts in associations or with any other insurer approved by the supervisor and meeting the qualifications prescribed in this paragraph. No association subject to the provisions of the Savings and Loan Act shall obtain insurance of accounts from, or represent in any way that its accounts are insured by, any insurer other than the federal savings and loan insurance corporation or other federal agency or a state agency unless the supervisor, upon application to him by the association and after reasonable notice and public hearing by the supervisor, issues his certificate approving the application after determining that: (a) the contract of insurance contemplated is written upon substantially the same basis as to form, amount, coverage, maturity, voluntary and involuntary termination and other provisions as the insurance contract provided by the federal savings and loan insurance corporation, and complies with any further requirements for protection the supervisor deems reasonably necessary; and (b) the contract is underwritten by an insurer having a net worth reasonably commensurate with the risks underwritten, but not less than twenty-five million dollars ($25,000,000), which is licensed in this state and authorized to do business in this state, and which is admitted and authorized by law to write such insurance in all of the states of the United States. The requirements of this paragraph apply to all revisions or modifications of such contracts of insurance. Associations and foreign associations insured as provided in this paragraph may make representations as to insurance of savings accounts, but all representations shall set forth the name of the insurer. Except for banks, no association or foreign association or other person shall advertise or represent or accept or offer to accept any savings accounts in this state as insured or guaranteed accounts, or as the savings accounts of an insured or guaranteed institution, unless they are insured as provided in this paragraph. Any person who violates any provision of this paragraph is guilty of a misdemeanor and shall be punished by a fine not to exceed ten thousand dollars ($10,000). Each day of any violation is a separate offense, and shall be enjoined upon application to the district court by the attorney general, the supervisor, the district attorney or by any association in this state. The requirements of this paragraph are in the exercise of the police power of this state and are enacted to protect the people of the state from misrepresentation, misunderstanding and from loss. B. If the supervisor so finds, he shall state his findings in writing, endorse his approval on the articles of incorporation, issue under his official seal a certificate of authority for the association to transact business, deliver copies of the approved articles of incorporation and bylaws to the incorporators and to the state corporation commission [public regulation commission] and retain a copy as a permanent file of his office. Upon acceptance and approval by the state corporation commission [public regulation commission] of the articles of incorporation, the proposed association is a corporate body with perpetual existence unless terminated by law, and it may exercise the powers of an association as set forth in the Savings and Loan Act. Before actually transacting any savings and loan business, the association shall file with the supervisor satisfactory proof that insurance of accounts has been obtained. History: 1953 Comp., § 48-15-56, enacted by Laws 1967, ch. 61, § 12.