§ 3018. Loans

Legislative history

Reconstructed from this section’s Code source credit and amendment notes, resolved against the local Statutes at Large. Editorial notes are evidence, not the law that made the change.

1. 1978

   National Consumer Cooperative Bank Act

   Pub. L. 95–351 title I § 108 · 92 Stat. 499

   Enacted · 12 U.S.C. § 3018

   Pub. L. 95–351, title I, § 108, Aug. 20, 1978, 92 Stat. 508

   Source evidence

   Code source credit
   Pub. L. 95–351, title I, § 108, Aug. 20, 1978, 92 Stat. 508

   Enacted provision · exact public law section
   Sec. 108. lending powers (a) The Bank may make loans and commitments for loans 12 USC 3018. under this subsection to any organization determined by the Bank to be eligible under the provisions of section 105 of this Act, and may purchase or discount obligations of members of such organizations if the Bank, to the exclusion of all other persons, entities, agencies, or jurisdictions, also determines that the applicant has or will have a sound organizational and financial structure, income in excess of its operating costs and assets in excess of its obligations, and a reasonable expectation of a continuing demand for its production, goods, commodities, or services, or the use of its facilities, so that the loan will be fully repayable in accordance with its terms and conditions. Commencing on October 1, 1983, the Bank shall not make any loan to a cooperative for the purpose of financing the construction, ownership, acquisition, or improvement of any structure used primarily for residential purposes if, after giving effect to such loan, the aggregate amount of all loans outstanding for such purpose would exceed 30 per centum of the gross assets of the Bank. The Board of Directors shall use its best efforts to insure that at the end of each fiscal year of the Bank at least 35 per centum of its outstanding loans are to— (1) cooperatives at least a majority of the members of which are low-income persons, and (2) other cooperatives, if the proceeds of such loans are directly applied to finance a facility, activity, or service that the Board finds will be used predominantly by low-income persons. The Board shall adopt and publish in the Federal Register rules defining Publication in Federal Register. the term “low-income persons” for purposes of this subsection. The criteria to be applied and the factors to be considered by the Bank in making loans, loan commitments, purchases, discounts, and guarantees shall include an assessment of the impact of the loan on existing small businesses in the eligible organizations’ business territory. The criteria and factors shall be stated in rules of the Bank which shall be published and made available to applicants and, upon request, to any other person or organization. (b) Loans under this section shall be repayable in not more than forty years and, except for loans with final due date not longer than five years from the date of the loan, shall be amortized as to principal and interest. In setting the terms, rates, and charges, it shall be the objective of the Bank to provide the type of credit needed by eligible borrowers, at the lowest reasonable cost on a sound business basis, taking into account the cost of money to the Bank, necessary reserve and expenses of the Bank, and the technical and other assistance attributable to loans under this section made available by the Bank, but so long as the Bank makes loans from the proceeds of the sale of class A stock, the interest rate shall not be less than the rates generally prevailing in the area from other sources for loans for similar purposes and maturities, taking into consideration the cost to the borrower of required purchase of class B stock in the Bank. The loan terms may provide for interest rates to vary from time to time during the repayment period of the loan in accordance with the rates being charged by the Bank for new loans at such times. The proceeds of a loan under this subsection may be advanced by the borrower to its members or stockholders under circumstances described in the bylaws or rules of the Bank. (c) Subject to section 102(13), the Bank may guarantee all or any part of the principal and interest of any loan made by any State or federally chartered lending institution to any borrower if such loan is to an organization that would be an eligible borrower from the Bank for a direct loan and is on terms and conditions (including the rate of interest) which would be permissible terms and conditions for such a direct loan. The Bank may impose a charge for any such guarantee. No loan may be guaranteed by the Bank if the income therefrom to the lender is excluded from such lender’s gross income for purposes of chapter 1 of the Internal Revenue Code of 1954. 26 USC 1 et seq. (d) Any loan guaranteed under subsection (c) shall be assignable to the extent provided in the contract of guarantee as may be determined by the Bank. The guarantee shall be uncontestable, except for fraud or misrepresentation of which the holder had actual knowledge at the time he acquired the loan. The Bank in lieu of requiring such lender to service such guaranteed loan until final maturity or liquidation, may purchase the loan for the balance of the principal and accrued interest thereon without penalty, if it determines that (1) the liquidation of the loan would result in the insolvency of the borrower or deprive the borrower of assets essential to its continued operation, and (2) the loan will be repayable with revision of the loan rates, terms, or payment periods or other conditions not inconsistent with loans made by the Bank under subsection (a) of this section, which revisions the lender or other holder of such guaranteed loan is unwilling to make. (e) As long as any of the class A stock of the Bank is held by the Secretary of the Treasury, the aggregate amount of commitments by the Bank to make or guarantee loans shall not exceed such amounts as may be specified in annual appropriation Acts.

2. 1981

   Pub. L. 97–35 § 394(b) · 95 Stat. 357

   Substituted · 12 U.S.C. § 3018(a)

   Pub. L. 97–35, § 394(b), substituted “1985” for “1983”

   Source evidence

   Code amendment note
   Subsec. (a). Pub. L. 97–35, § 394(b), substituted “1985” for “1983”.

   Enacted provision · exact public law section
   (b) The second sentence of section 108(a) of such Act (12 U.S.C. 3018(a)) is amended by striking out “October 1, 1983” and inserting in lieu thereof “October 1, 1985”.

   Effective date note
   Amendment by section 396(e) of Pub. L. 97–35 effective on day after Final Government Equity Redemption Date (Dec. 31, 1981), see section 396(i) of Pub. L. 97–35, set out as a note under section 3011 of this title.

3. 1981

   Pub. L. 97–35 § 396(e) · 95 Stat. 357

   Struck · 12 U.S.C. § 3018(b)

   Pub. L. 97–35, § 396(e), struck out provisions relating to proceeds from class A and class B stock

   Source evidence

   Code amendment note
   Subsec. (b). Pub. L. 97–35, § 396(e), struck out provisions relating to proceeds from class A and class B stock.

   Enacted provision · exact public law section
   (e) The second sentence of section 108(b) of such Act (12 U.S.C. 3018(b)) is amended by striking out “, but so long as” and all that follows through “class B stock in the Bank”.

   Effective date note
   Amendment by section 396(e) of Pub. L. 97–35 effective on day after Final Government Equity Redemption Date (Dec. 31, 1981), see section 396(i) of Pub. L. 97–35, set out as a note under section 3011 of this title.

4. 1986

   Tax Reform Act of 1986

   Pub. L. 99–514 § 2 · 100 Stat. 2085

   Substituted · 12 U.S.C. § 3018(c)

   Pub. L. 99–514 substituted “Internal Revenue Code of 1986” for “Internal Revenue Code of 1954”, which for purposes of codification was translated as “title 26” thus requiring no change in text

   Source evidence

   Code amendment note
   Subsec. (c). Pub. L. 99–514 substituted “Internal Revenue Code of 1986” for “Internal Revenue Code of 1954”, which for purposes of codification was translated as “title 26” thus requiring no change in text.

   Enacted provision · exact public law section
   SEC. 2. INTERNAL REVENUE CODE OF 1986. (a) Redesignation of 1954 Code.— The Internal Revenue Title enacted August 16, 1954, as heretofore, hereby, or hereafter amended, may be cited as the “Internal Revenue Code of 1986”. (b) References in Laws, Etc.— Except when inappropriate, any reference in any law, Executive order, or other document— (1) to the Internal Revenue Code of 1954 shall include a reference to the Internal Revenue Code of 1986, and (2) to the Internal Revenue Code of 1986 shall include a reference to the provisions of law formerly known as the Internal Revenue Code of 1954.

4 of 4 references resolved to an enrolled provision