Information Maintained by the Office of Code Revision Indiana Legislative Services Agency
IC 28-6.1-7
     Chapter 7. Powers of a Savings Bank Subject to the Rules of the Department

IC 28-6.1-7-1
Application of rules
     Sec. 1. (a) The powers of a savings bank set forth in this chapter are subject to the rules of the department.
    (b) A rule adopted under this chapter may apply to one (1) or more savings banks or to one (1) or more localities in Indiana as the department determines.
As added by P.L.42-1993, SEC.72.

IC 28-6.1-7-2
Making FHA loans, advances of credit, and purchases of obligations
     Sec. 2. (a) A savings bank may make loans and advances of credit and purchases of obligations representing loans and advances of credit that are eligible for insurance by the federal housing administrator and to obtain such insurance.
    (b) An Indiana law:
        (1) prescribing the nature, amount, or form of security;
        (2) requiring security upon which loans or advances of credit may be made;
        (3) prescribing or limiting interest rates upon loans or advances of credit; or
        (4) prescribing or limiting the period for which loans or advances of credit may be made;
does not apply to loans, advances of credit, or purchases made under this section.
As added by P.L.42-1993, SEC.72.

IC 28-6.1-7-3
Making FHA loans secured by mortgages
     Sec. 3. (a) A savings bank may make loans secured by mortgages on real property or leasehold, as the federal housing administrator insures or makes a commitment to insure, and to obtain such insurance.
    (b) An Indiana law:
        (1) prescribing the nature, amount, or form of security;
        (2) requiring security upon which loans or advances of credit may be made;
        (3) prescribing or limiting interest rates upon loans or advances of credit; or
        (4) prescribing or limiting the period for which loans or advances of credit may be made;
does not apply to loans made under this section.
As added by P.L.42-1993, SEC.72.

IC 28-6.1-7-4

Purchasing, investing in, and disposing of FHA and national mortgage association bonds, notes, and debentures
     Sec. 4. (a) A savings bank may purchase, invest in, and dispose of any of the following:
        (1) Notes or bonds secured by mortgage or trust deed insured by the federal housing administrator.
        (2) Debentures issued by the federal housing administrator.
        (3) Bonds or other securities issued by national mortgage associations.
    (b) An Indiana law:
        (1) prescribing the nature, amount, or form of security;
        (2) requiring security upon which loans or advances of credit may be made;
        (3) prescribing or limiting interest rates upon loans or advances of credit; or
        (4) prescribing or limiting the period for which loans or advances of credit may be made;
does not apply to purchases, investments, or dispositions made under this section.
As added by P.L.42-1993, SEC.72.

IC 28-6.1-7-5
Extending credit to state agencies
     Sec. 5. (a) A savings bank may extend credit to any state agency, with the approval of the department, notwithstanding any other provisions or limitations of IC 28-1.
    (b) An Indiana law:
        (1) prescribing the nature, amount, or form of security;
        (2) requiring security upon which loans or advances of credit may be made;
        (3) prescribing or limiting interest rates upon loans or advances of credit; or
        (4) prescribing or limiting the period for which loans or advances of credit may be made;
does not apply to loans or advances of credit made under this section.
As added by P.L.42-1993, SEC.72.

IC 28-6.1-7-6
Purchasing, taking, holding, and disposing of incorporated joint stock land bank notes and mortgages
     Sec. 6. (a) A savings bank may purchase, take, hold, and dispose of notes and mortgages securing the notes, made to any incorporated joint stock land bank if not less than ninety-nine percent (99%) of the stock of the joint stock land bank is owned by the savings bank at the time the notes or mortgages are acquired by the savings bank.
    (b) Upon dissolution of the joint stock land bank, or at any stage in the process of the dissolution, a savings bank then owning not less than ninety-nine percent (99%) of the stock of the joint stock land bank may take, hold, and dispose of notes, mortgages, or other assets of the joint stock land bank of any nature, including real estate,

wherever located, that the joint stock land bank assigns, transfers, conveys, or otherwise makes over to the savings bank by way of final or partial distribution of the joint stock land bank's assets to the joint stock land bank's stockholders upon the dissolution or in connection with the process of the dissolution.
    (c) An Indiana law:
        (1) prescribing the nature, amount, location, or form of security;
        (2) requiring security upon which loans or advances of credit may be made;
        (3) prescribing or limiting interest rates upon loans or advances of credit;
        (4) prescribing or limiting the period for which loans or advances of credit may be made;
        (5) prescribing any ratio between the amount of a loan and the appraised value of the security for the loan; or
        (6) requiring periodic reductions of the principal of a loan;
does not apply to loans, notes, mortgages, real estate, or other assets subject to this section.
As added by P.L.42-1993, SEC.72.

IC 28-6.1-7-7
Owning and leasing property
     Sec. 7. Subject to any restrictions the department may impose, a savings bank may:
        (1) become the owner or lessor of personal or real property upon the request of and for the use of a customer; and
        (2) incur additional obligations incident to becoming an owner or a lessor of the property.
As added by P.L.42-1993, SEC.72. Amended by P.L.11-1998, SEC.11.

IC 28-6.1-7-8
Purchasing and constructing buildings to be leased to public authorities
     Sec. 8. (a) A savings bank may purchase or construct buildings and hold legal title to a building to be leased to a municipal corporation or other public authority, for public purposes, having resources sufficient to make payment of all rentals as the payments become due.
    (b) A lease agreement shall provide that upon expiration, the lessee will become the owner of the building.
As added by P.L.42-1993, SEC.72.

IC 28-6.1-7-9
Purchasing, holding, and conveying real property to be used as branch savings bank and rental property; resolution
     Sec. 9. (a) Subject to the prior written approval of the department, a savings bank may purchase, hold, and convey real property that is:
        (1) improved or to be improved by a single, freestanding building; and

        (2) to be used, in part, as a branch of the savings bank and, in part, as rental property for one (1) lessee.
    (b) If real estate described in subsection (a) is held by a savings bank for at least one (1) year without being used as described in subsection (a), the board of directors of the savings bank shall state, by resolution, definite plans for the use of the real estate. A resolution adopted under this subsection shall be made available for inspection by the department.
    (c) Unless a written extension of time is given by the department under this subsection, the savings bank shall open the branch not later than three (3) years after the acquisition date of the real estate. The department may grant an extension of time for the savings bank to open the branch if:
        (1) the board of directors of the savings bank, by resolution:
            (A) reaffirms annually that the savings bank expects to use the real estate as described in subsection (a) in the future; and
            (B) explains the reason why the real estate has not yet been used as described in subsection (a); and
        (2) the director determines that:
            (A) the continued holding of the real estate by the savings bank does not endanger the safety and soundness of the savings bank; and
            (B) the savings bank is holding the real estate to use the real estate in the future for one (1) of the purposes set forth in subsection (a).
    (d) If the savings bank:
        (1) does not open a branch on the real estate within the period specified in subsection (c); or
        (2) removes its branch from the real estate;
the savings bank shall divest itself of all interest in the real estate not more than ten (10) years after the acquisition date of the real estate, if a branch was not opened, or ten (10) years after the removal date of the branch office.
    (e) Except with the written approval of the department, the sum invested in real property and buildings used for the convenient transaction of the savings bank's business as provided in this section may not exceed fifty percent (50%) of the surplus and retained earnings of the savings bank.
As added by P.L.42-1993, SEC.72. Amended by P.L.213-2007, SEC.63; P.L.217-2007, SEC.61.

IC 28-6.1-7-10
Repealed
    (Repealed by P.L.215-1999, SEC.16.)

IC 28-6.1-7-11
Investing in community development corporations and projects
     Sec. 11. (a) As used in this section, "surplus" means the sum of the following:

        (1) The remainder of:
            (A) capital surplus, undivided profits, reserves for contingencies and other capital reserves (excluding accrued dividends on perpetual and limited life preferred stock), minority interests in consolidated subsidiaries, and allowances for loan and lease losses; minus
            (B) intangible assets.
        (2) Purchased mortgage servicing rights.
        (3) Mandatory convertible debt to the extent of twenty percent (20%) of the sum of capital, capital surplus, and purchased mortgage servicing rights.
        (4) Other mandatory convertible debt, limited life preferred stock, and subordinated notes and debentures to the extent that the debt, stock, notes, and debentures qualify as "tier II capital" under 12 CFR 325.
    (b) A savings bank may invest in community development corporations and projects of a predominantly civic, community, or public nature, including equity investments in corporations or limited liability companies organized for such purposes. Investments by a savings bank under this subsection shall not exceed:
        (1) in any one (1) project, two percent (2%); and
        (2) in the aggregate, five percent (5%);
of the capital and surplus of the savings bank, unless the director makes the determination set forth in subsection (c).
    (c) Investments by a savings bank under subsection (b) may exceed the limit set forth in subsection (b)(2) if the director determines that:
        (1) the aggregate investments by the savings bank under subsection (b) in excess of five percent (5%) of the capital and surplus of the savings bank will not pose a significant risk to the affected deposit insurance fund; and
        (2) the savings bank is adequately capitalized.
However, in no case shall the aggregate investments by a savings bank under subsection (b) exceed ten percent (10%) of the capital and surplus of the savings bank.
    (d) A savings bank shall not make any investment under subsection (b) if the investment would expose the savings bank to unlimited liability.
As added by P.L.42-1993, SEC.72. Amended by P.L.136-1994, SEC.5; P.L.2-1995, SEC.114.

IC 28-6.1-7-12
Purchasing, holding, and conveying real estate necessary for transaction of business
     Sec. 12. (a) A savings bank may purchase, hold, and convey real estate that is necessary for the convenient transaction of the business of the savings bank.
    (b) For the purposes of this section, real estate purchased or held for the convenient transaction of the business of a savings bank includes the following:

        (1) Real estate on which the principal office or a branch office of the savings bank is located.
        (2) Real estate that is the location of facilities supporting the operations of the savings bank, such as parking facilities, data processing centers, loan production offices, automated teller machines, night depositories, facilities necessary for the operations of a savings bank, or other facilities that are approved by the director.
        (3) Real estate that the board of the savings bank expects, in good faith, to use as a savings bank office or facility in the future.
    (c) If real estate referred to in subsection (b)(3) is held by a savings bank for one (1) year without being used as a savings bank office or facility, the board of trustees of the savings bank shall state, by resolution, definite plans for the use of the real estate. A resolution adopted under this subsection shall be made available for inspection by the department.
    (d) Real estate referred to in subsection (b)(3) may not be held by a savings bank for more than three (3) years without being used as a savings bank office or facility unless both of the following apply:
        (1) The board of the savings bank, by resolution:
            (A) reaffirms annually that the savings bank expects to use the real estate as a savings bank office or facility in the future; and
            (B) explains the reason why the real estate has not yet been used as a savings bank office or facility.
        (2) The director determines that both of the following apply:
            (A) The continued holding of the real estate by the savings bank does not endanger the safety and soundness of the savings bank.
            (B) The savings bank is holding the real estate to use in the future for one (1) of the purposes set forth in subsection (b)(1) and (b)(2).
    (e) Real estate referred to in subsection (b)(3) may not be held by a savings bank for more than ten (10) years without being used as a savings bank office or facility unless the department consents in writing to the continued holding of the real estate by the savings bank.
As added by P.L.42-1993, SEC.72.

IC 28-6.1-7-13
Paying interest and expenses
     Sec. 13. A savings bank may not pay:
        (1) interest contracted for with a depositor; or
        (2) other expenses incurred in operating the business of the savings bank;
except from current earnings or undivided profits without the approval of the department.
As added by P.L.42-1993, SEC.72.