Section 40.500 - Certificate RatioA ratio of certificates to capital and surplus restricted as to payment of cash dividends under section 18319 of the Financial Code, of 20 to 1 will ordinarily be granted to established companies with records of sound performance. The Commissioner may, in other cases, limit the ratio of certificates to capital and surplus to a ratio of less than 20 to 1 if in his or her judgment the lower ratio is necessary in the public interest. In determining the ratio to be permitted, the Commissioner may consider (together with all relevant attendant circumstances) one or all of the following items:
(a) The length of time the company has been in operation.(b) Ratio of losses to volume of loans made and contracts purchased.(c) The creation and maintenance of adequate reserve for losses.(d) Charge-off of uncollectible accounts.(e) The amount or growth of undivided profits and/or earned surplus.(f) Diversification of character and source of loans made and contracts purchased.(g) Creation and maintenance of adequate internal controls.(h) Sound and efficient management.Cal. Code Regs. Tit. 10, § 40.500
1. Change without regulatory effect adding new article 5 (sections 40.500-40.503) and renumbering and amending former section 1150 to new section 40.500 filed 8-19-97 pursuant to section 100, title 1, California Code of Regulations (Register 97, No. 34). Note: Authority cited: Sections 18315 and 18347, Financial Code. Reference: Section 18319, Financial Code.
1. Change without regulatory effect adding new article 5 (sections 40.500-40.503) and renumbering and amending former section 1150 to new section 40.500 filed 8-19-97 pursuant to section 100, title 1, California Code of Regulations (Register 97, No. 34).