shall be deemed conditioned upon the performance of the provisions of this article relating to the payment of loans, premiums, interest and fines thereon, and the by-laws of the association, although the same may not be fully expressed therein. A borrower may repay a loan, and all arrears of interest, premium, if any, and fines thereon, or one or more shares thereof, at any stated meeting or at any time, but the by-laws may otherwise provide; when not made at a stated meeting, he shall pay interest up to the first stated meeting after such payment, or he may, by a proper notice, and directions as to the application, have the withdrawal or holding value of the shares borrowed upon, applied in payment or part payment, as the by-laws shall determine. Should there at any time be money in the treasury not called for by the borrowing or withdrawing members, the board of directors may make temporary loans to members out of the same, at such rate of interest not exceeding six per centum, and under such provisions and restrictions as the by-laws may prescribe. Such temporary loans shall not run more than ninety days and shall be secured by the personal note of the borrower, and also by a pledge of shares to the association, the withdrawal value of which shares shall be at least ten per centum more than the amount of the loan and the interest thereon to its maturity. If at any time there is money in the treasury as above in excess of the amount needed to meet the demand for such temporary loans, it may be invested in the same kind of securities and under the same restrictions as allowed to savings banks by section one hundred and forty-six of this chapter. No corporation incorporated under the provisions of this article or under the provisions of the repealed acts hereafter enumerated in section two hundred and thirty-two of this chapter which upon the first day of March, nineteen hundred and one, was not engaged in the business of loaning its funds upon second mortgages upon real estate, shall hereafter loan any portion of its funds upon the security of real estate upon which there is a prior lien or incumbrance, or accept from a borrower a mortgage upon real estate which is not a first mortgage, or purchase real estate securities, or invest any portion of its funds in real estate securities which are not first liens upon the property described in them, unless every prior mortgage, lien or incumbrance is owned by it, and no prior mortgage, lien or incumbrance shall be sold, assigned or transferred by any such corporation until all subsequent mortgages, liens or incumbrances owned by it shall have been fully paid and satisfied.

A corporation incorporated under the provisions of this article, or under the provisions of either of said repealed acts

hereinafter enumerated, which was, on the first day of March, nineteen hundred and one, engaged in the business of loaning its funds, or any portion thereof, upon second or divided mortgages or upon subsequent or secondary liens upon real estate, whether the prior mortgages or liens are given to or held by such corporation or not, and which shall hereafter continue to make loans upon such second mortgages or liens, shall not advance in any such loans a sum which taken together with the amount of all prior liens or incumbrances, exceeds seventy-five per centum of the appraised value of the real estate upon which such loans are made. Nor shall the total amount so loaned by any such corporation exceed at any time an amount equal to thirty-three and onethird per centum of the net amount paid in on its capital stock in good standing. Provided further that such corporation shall invest not less than fifteen per centum the first year, twenty per centum the second year, and thereafter twenty-five per centum of its receipts applicable for loaning purposes in the same securities in which savings banks are by section one hundred and fortysix of this chapter, authorized to invest their deposits and the income derived therefrom, until the funds so invested shall amount to at least twenty-five per centum, and to be at all times so maintained, of all mortgages and liens underlying the mortgages or liens held by it (except that after said fund shall amount to fifteen per centum of all underlying mortgages and liens held by such corporations, the remainder, or any portion of the remainder thereof, may be used in cases of emergency in the payment of withdrawals). Provided, however, such investment in such securities need not exceed five hundred thousand dollars in any case. such corporation engaged on the first day of March, nineteen hundred and one, in the business of loaning its funds or any portion thereof upon second or divided mortgages, or subsequent or secondary liens, shall after the eleventh day of April, nineteen hundred and one, make any such loans upon the security of vacant or unimproved real estate.

No

§ 220. Arrearages; forfeitures; withdrawal values. Whenever any member shall be six months in arrears in the payment of his dues upon free shares, the secretary shall give him notice thereof in writing, and a statement of his arrearages, by mailing the same to him at the last post-office address given by him to the association, and if he shall not pay the same within two months thereafter, the board of directors may, at their option, declare his shares forfeited; and at the time of such forfeiture the withdrawal value thereof shall be determined and stated, and the defaulting member shall be entitled to withdraw the same without interest within one year upon such notice as

shall be required of a withdrawing shareholder, and upon failure to so withdraw the same, then, and in that case, it may revert to the association.

§ 221. Loans due when members in arrears. Whenever a borrowing shareholder shall be in arrears in the payment of his dues, interest or premium two months, the whole loan shall become due at the option of the board of directors, and they may proceed to enforce collection upon the securities held by the association. The withdrawal value at the time of the commencement of the action of all shares pledged as collateral security for the loan, shall be applied upon the loan and arrearages of interest, premium and fines thereon, and the shares deemed surrendered to the association.

§ 222. May purchase at foreclosure sale. Any corporation incorporated under the provisions of this article or under the provisions of either of the repealed acts hereafter enumerated in section two hundred and thirty-two of this chapter may purchase at any sale, public or private, any real estate upon which it may have a mortgage, judgment lien or other incumbrance, taken or obtained in good faith in the regular transaction of the business of the association, and may sell, exchange, convey, lease or mortgage the same or any real estate it now owns at pleasure to any person or persons; it may also hold and own real estate for the purpose of occupying the same with its own business office. Except that no exchange of real estate shall be made except by the unanimous vote of the directors of the corporation making such exchange, and no such exchange shall be made upon a basis involving the payment by said corporation of any difference in value unless approved by the superintendent of banks. No corporation incorporated under the provisions of this article or under the provisions of either of the repealed acts hereafter enumerated in section two hundred and thirty-two of this chapter, shall hereafter purchase or exchange real estate except as hereinbefore provided; and every contract hereafter made by or on behalf of any such association for the purchase or exchange of real estate or for any purpose not hereinbefore expressly authorized shall be void. Any officer of any association, who shall consent to or participate in the making of any such void, illegal or unauthorized contract for the purchase or exchange of real estate, or who shall transfer to any person or persons any property of the corporation in pursuance of any such void, illegal or unauthorized contract shall be guilty of a misdemeanor.

§ 223. Association may borrow to pay withdrawals. Any association organized in pursuance of the provisions of this article may borrow money for the purpose of making loans or paying withdrawals, not exceeding, however, two thousand dollars, so long as its accumulated capital shall not exceed twenty thousand dollars, and when its accumulated capital exceeds that sum, not exceeding ten per centum thereof. No money borrowed shall be for a longer term than one year. Any association having a surplus in its treasury for which there is no demand for loans, withdrawing stockholders, matured or paid-up stock, may loan the same to another association, organized under the provisions of this article, subject to the provisions of this section, on the part of the borrowing association. No association shall borrow or make loans in this section authorized, except by a majority vote of all the members of its board of directors, the vote to be recorded by ayes and nays in its regular

minutes.

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§ 224. Profits and losses ascertained annually. Profits and losses shall be ascertained at least annually, and shall be distributed to all shares outstanding at the time of such distribution, in the manner provided by the by-laws of the association. At each periodical distribution of profits, the board of directors shall reserve and carry to a reserve or contingent fund, a sum equal to at least five per centum of the net earnings during the period since the last previous dividend was declared, until such reserve or contingent fund shall be equal to at least five per centum of the dues and dividends credited to members by series or otherwise, and equal to at least fifty per centum of the book value of all real estate owned by the association. directors may carry to such reserve or contingent fund any further portion of the undivided earnings that in their discretion seems wise. When any association takes property at a foreclosure sale or in extinguishment of a debt, it shall not be put upon the books of the association at a figure in excess of the sum due the association at the time of first default. Whenever, by any loss which an association may sustain, from this or any other cause, the reserve or contingent fund is reduced below five per centum of the dues and dividends credited to members by series or otherwise, or below fifty per centum of the book value of all real estate owned by an association, the board of directors shall, at each periodical distribution of profits, carry to such reserve or contingent fund five per centum of the net earnings during the period since the last previous dividend was declared, until such reserve or contingent fund shall again be equal to at least five per centum of the dues and dividends credited to members, by series or otherwise, and

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equal to at least fifty per centum of the book valuation of all real estate owned by the association. This section applies to every association or corporation organized under the provisions of this article and under chapter one hundred and twenty-two of the laws of eighteen hundred and fifty-one, chapter five hundred and fiftysix of the laws of eighteen hundred and eighty-seven, chapter six hundred and eighty-nine of the laws of eighteen hundred and ninety-two and the acts amendatory of each and every of said laws.

§ 225. Transfer of shares. No transfers of shares shall be binding upon the association until the same have been made upon the books of the association; and the transferee thereof shall take the same charged with all the liabilities and conditions attaching thereto in the hands of the one transferring the same. The association may require a "transfer fee," not exceeding twenty-five cents per share, or in lieu thereof a total fee not exceeding one dollar on each transfer.

§ 226. Attorney; auditors; amendments to bylaws; right to vote. The board of directors shall have the power to appoint and remove, at pleasure, an attorney-at-law for the association. The by-laws of the association may provide for the election of auditors, and prescribe their duties and compensation, and shall provide in what manner the by-laws themselves may be amended. At the time of the adoption of by-laws on the formation of an association, only those members who have joined in the certificate of incorporation are entitled to vote, and each incorporator shall have only one vote.

§ 227. Eligibility to membership; exemption from execution; from taxation. Any person of full age and sound mind may become a member of the association by taking one or more shares therein and subscribing to the by-laws, and annexing to his signature his post-office address; and whenever he desires his post-office address changed he shall give written notice thereof to the secretary of the association; and for the pur pose of giving any member notice, by mail, the last post-office address given by him shall be deemed the proper one. A minor may hold shares in the name of a parent, guardian or next friend, as trustee for him, but the association shall not be responsible to said infant for any moneys received by said trustees on account of said shares from the association. All accumulations upon shares in said association held by any person shall be exempt from execution and proceedings supplementary thereto to the amount of six hundred dollars; and the association itself shall be deemed an institution for savings, and not taxable under any tax law which shall exempt savings banks or institutions for savings