N.M. Code R. § 12.20.48.8

Current through Register Vol. 35, No. 11, June 11, 2024

Section 12.20.48.8 - GENERAL SERVICE CORPORATIONS

An association may invest in the capital stock, obligations or other securities of a service corporation organized under the law of the state of New Mexico if:

A. the service corporation's entire capital stock is available for purchase by, and only by, any and all savings and loan associations with a home office in this state, and the capital stock is owned by more than one savings and loan association;

B. no savings and loan association owns, or may own, more than 10 percent of the service corporation's outstanding capital stock;

C. every eligible association may own an equal amount of such stock or may, on such uniform basis as the supervisor may determine, own an amount of such stock equaling a stated percentage of its assets or savings capital at the time it purchases any such stock; and

D. substantially all of the service corporation's activities, performed directly or through one or more wholly owned subsidiaries or joint ventures, consist of one or more of the following:

(1) originating, purchasing, selling and servicing any of the following:

(a) loans, and participation in loans, on a prudent basis and secured by real estate or first liens on mobile homes, including brokerage and warehousing of such loans;

(b) loans, with or without security, for altering, repairing, improving, equipping or furnishing residential real estate;

(c) educational loans; and

(d) consumer loans;

(2) making any of the following kinds of investments:

(a) investments specified in Section 58-10-45 NMSA 1978;

(b) investments in savings accounts in an association which is a stockholder in the service corporation, if the service corporation receives no consideration, other than interest at the current market rate, for opening or maintaining any such account;

(3) performing the following services, primarily for savings and loan associations:

(a) clerical services, accounting, data processing and internal auditing;

(b) credit information, appraising, construction loan inspection and abstracting;

(c) developing and administration of personnel benefit programs, including life insurance, health insurance and pension or retirement plans;

(d) research, studies and surveys;

(e) purchasing office supplies, furniture and equipment;

(f) developing and operating storage facilities for microfilm or other duplicate records;

(g) advertising and other services to procure and retain both savings accounts and loans;

(4) acquiring unimproved real estate for prompt development and subdivision, principally for construction of housing or for resale to others for such construction, or for use as mobile home sites. However, if the total cost to the service corporation to purchase, develop, subdivide and construct improvements on such real estate exceeds 20 percent of its asset, it shall notify the supervisor within 30 days after such acquisition. Notification shall include the number of lots or acres involved and the project's name, location, estimated completion date and total projected cost including dollar involvement of the service corporation.

(5) developing, subdividing and constructing improvements (including improvements to be used for commercial purposes, when incidental to a housing project) for sale or for rental on real estate referred to in Paragraph 8.4.4 [now Paragraph (4) of Subsection D of 12.20.48.8 NMAC]. However, such development, subdivision and construction of improvements must be completed within three years after commencement of development of such real estate and within five years after acquisition of the real estate, unless such period is subsequently extended by the supervisor upon written application by the service corporation. Acquisition of an option to purchase is not an acquisition for the purpose of determining such period;

(6) acquiring improved residential real estate and mobile homes to be held for rental;

(7) acquiring improved residential real estate for remodeling, renovating or demolishing and rebuilding for sale or for rental;

(8) maintaining and managing rental real estate referred to in paragraphs 8.4.5, 8.4.6, and 8.4.7 [now Paragraphs (5), (6) and (7) of Subsection D of 12.20.48.8 NMAC] and any real estate owned by holders of its capital stock;

(9) serving as insurance broker or agent, in accordance with applicable laws, primarily dealing in policies for savings and loan associations, their borrowers and account holders, which provide protection such as homeowner's, fire, theft, automobile, life, health, accident and title but excluding private mortgage insurance;

(10) serving as escrow agent or as trustee under deeds of trust;

(11) preparing state and federal tax returns for account holders of or borrowers from a stockholder of the service corporation (including their family members but not including an account-holder or borrower which is a corporation operated for profit);

(12) acquiring, maintaining and managing real estate (improved or unimproved) to be used for offices and related facilities of a stockholder of the service corporation, or for such offices and related facilities and for rental or sale, if such acquisition, maintenance and management is performed under a prudent program of property acquisition to meet either the stockholder's present needs or reasonable future needs for office and related facilities. However, without prior approval of the director, no service corporation shall acquire such real estate if, as a result of the acquisition, the outstanding aggregate book value of all such real estate owned by the stockholder and its service corporations would exceed its consolidated net worth;

(13) issuing credit cards, extending credit in connection therewith, and otherwise engaging in or participating in credit card operations;

(14) activities reasonably incident to those listed in paragraphs 8.4.1 thorugh 8.4.12 [now Paragraphs (1) through (12) of Subsection D of 12.20.48.8 NMAC]; and

(15) such other activities reasonably related to the activities of associations as the supervisor may approve.

N.M. Code R. § 12.20.48.8

11/17/80; 9/15/97; Recompiled 10/15/01