N.Y. Banking Law § 403: Examination by directors

§ 403. Examination by directors. 1. Once in each calendar year the

directors of every savings and loan association by a committee of not

less than three of their number, none of whom shall be salaried officers

or employees of such association, shall examine fully the records and

affairs of such association for the purpose of determining its true

financial condition. Such examination shall be made as of a date not

less than six months after the date of the previous such examination.

2. In the conduct of each such examination, inquiry shall be made

into the policies of management for the purpose of determining whether

such policies are sound and consistent with the requirements of law, and

into such other matters as shall be necessary to enable the directors to

determine whether adequate protection is afforded to shareholders and

depositors.

3. A savings and loan association's compliance with section one

hundred twelve of the Federal Deposit Insurance Corporation Act of 1991,

as implemented by the provisions of part three hundred sixty-three of

the rules and regulations of the Federal Deposit Insurance Corporation,

as they may be amended from time to time, shall be deemed to satisfy the

examination requirement of this section.

4. The directors may employ such assistance as they deem necessary in

making the examinations prescribed by this section. Within thirty days

after the completion of such examination, a report thereof, in such form

as the superintendent may prescribe and sworn to by the directors making

the report, shall be presented to the board of directors of such

association at a regular meeting, and placed on file in the office of

the association. Within ten days after the presentation of such report

to the board of directors a duplicate thereof shall be filed in the

office of the superintendent, together with a certificate that such

report was presented to the board of directors, in the form prescribed

by the superintendent.