§412:7-203  Service corporations.  (a) "Service corporation" means a corporation whose stock is ownedentirely by one or more state or federally chartered savings and loanassociations or savings banks.

(b)  Subject to the approval of thecommissioner, a savings and loan association may form and own a servicecorporation only if the institution or institutions participating in theformation of the service corporation are in a safe and sound condition, and theamount of stock to be owned by each will not adversely affect their capital orsolvency.

(c)  A savings and loan association may not ownor invest in any capital stock, securities, or other interest of a servicecorporation if, together with its investment in the capital stock, securities,or other interest of any other service corporations, its aggregate outstandinginvestment in all service corporations will exceed six per cent of the savingsand loan association's assets.

(d)  No service corporation may be formedexcept upon written approval by the commissioner of an application submitted ina form satisfactory to the commissioner.  The approval shall be subject to thewritten acknowledgment by the applicant that the service corporation shall besubject to:

(1)  The supervision of the commissioner;

(2)  Examination pursuant to this section; and

(3)  Any other terms and conditions as thecommissioner deems appropriate.

(e)  Every service corporation shall permit thecommissioner to examine its books, records, and activities from time to time,to the extent and whenever the commissioner deems necessary to determine thepropriety of any investment by a savings and loan association in the servicecorporation and whether the activities of the service corporation pose asignificant risk of loss to the parent savings and loan association.  Theservice corporation shall pay the entire cost of the examination.  In addition,a service corporation, at its sole expense, shall cause an independent audit tobe made of its books, records, and activities if and when deemed necessary bythe commissioner.

(f)  A service corporation may engage inactivities permitted for a service corporation of a federally chartered savingsand loan association and other activities as the commissioner may approve.

(g)  A service corporation may engage inpermitted activities directly or through one or more subsidiaries or jointventures.

(h)  Whenever a service corporation engages inan activity that is not permitted under this section, and because of theactivity a savings and loan association's investment in the service corporationwould be improper, within ninety days following written notice from thecommissioner to the savings and loan association:

(1)  The improper activity shall be discontinued; or

(2)  The savings and loan association shall divestitself of its ownership or investment in the service corporation.

The service corporation or the savings and loanassociation may appeal the commissioner's decision and request a hearing inaccordance with chapter 91.

(i)  The savings and loan association shallnotify the commissioner in writing within five days of closing a servicecorporation. The notification shall provide the date of closing, the reasonsfor the closure, and the means by which the assets and liabilities of the servicecorporation were disposed. [L 1993, c 350, pt of §1; am L 2006, c 228, §38]

 

Rules of Court

 

  Appeals, see HRCP rule 72.