KRS 155.080: Membership -- Duty of members -- Loan limit formula.

(1) Any financial institution may request membership in the corporation by making

application to the board of directors on such form and in such manner as said board

of directors may require, and membership shall become effective upon acceptance

of such application by said board.

(2) Except for short term loans which members may make at their discretion, each

member of the corporation shall make loans to the corporation as and when called

upon by it to do so on such terms and other conditions as shall be approv ed from

time to time by the board of directors, subject to the following conditions:

(a) All loan limits shall be established at the thousand dollar ($1,000) amount

nearest to the amount computed in accordance with the provisions of this

section;

(b) No lo an to the corporation shall be made if immediately thereafter the total

amount of the obligations of the corporation would exceed twenty (20) times

the amount then paid in on the outstanding capital stock of the corporation;

and

(c) The total amount outstanding on loan to the corporation made by any member

at any one (1) time when added to the amount of the investment in the capital

stock of the corporation then held by such member shall not exceed the

following limit, to be determined as of the time such m ember becomes a

member on the basis of the audited balance sheet of such member at the close

of its fiscal year immediately preceding its application for membership, or, in

the case of an insurance company, its last annual statement to the

commissioner of insurance:

1. Two percent (2%) of the capital and surplus of commercial banks and

trust companies;

2. One percent (1%) of the total outstanding loans made by a building and

loan association: provided, however, that any business development

corporation created pursuant to this section, KRS 155.010 and 155.090

may in its articles of incorporation, or by appropriate amendment

thereto, provide that the loan limit of a building and loan association

member shall be only one -half of one percent (0.5%) of the total

outstanding loans made by such building and loan association member;

3. One percent (1%) of the capital and unassigned surplus of stock

insurance companies, except fire insurance writing companies;

4. One percent (1%) of the unassigned surplus of mutual i nsurance

companies, except fire insurance writing companies;

5. One-tenth of one percent (0.1%) of the assets of fire insurance writing

companies; and

6. Such limits as may be approved by the board of directors of the

corporation for other financial institutions.