17-2204.   Powers of credit unions.A credit union shall have the following powers:

      (a)   It may receive the savings of its members in payment forshares, makecontracts, sue and be sued, and provide negotiable checks, money orders,travelers checks, any other money typeinstruments or transfer methods, safe deposit boxes or similar safekeepingfacilities to its members.

      (b)   It may make loans to members through the credit committee orauthorizedloan officer in the way and manner provided in K.S.A. 17-2201 etseq., and amendments thereto.

      (c)   It may invest, through its board of directorsand under written investment policies established by the board:

      (1)   In all types of shares and accounts of acorporate credit union, located in the state of Kansas and under thesupervisionof the administrator;

      (2)   in shares or accounts of any savings and loan association ormutual savings bank the accounts of which are insured by an insurerapproved by the state in which it operates for guaranteeing the shares oraccounts of such institutions;

      (3)   in the bonds or other obligations of the United States ofAmerica,or securities fully guaranteed as to principal and interest thereby;

      (4)   in obligations of, or obligations issued by, any state orpolitical subdivisionthereof, including any agency, corporation or instrumentality of a state orpolitical subdivision, except that no credit union may invest more than 10%of its shares, undivided earnings and reserves in the obligations of anyone issuer exclusive of general obligations of the issuer;

      (5)   in savings banks, statebanks, trust companies and national banks,the accounts of which are insured by an insurer approved by the state inwhich it operates for guaranteeing the shares or accounts of such institutions.

      (6)   Unless the administrator authorizesotherwise, the funds of the credit union shall be used first for loans tomembers and preference shall be given to the smaller loans in the eventthe available funds do not permit all loans which have been approved bya loan officer or have passed the credit committee to be made.

      (d)   It may enter into agreements with financial institutionsor organizations for theextension of credit or debit services.

      (e)   It may do all things necessary to obtain, continue, pay forandterminate insurance of its shares and share certificates with thenational credit union share insurance fund or its successor orsuccessors or with an insurer approved by thestate commissioner of insurance or guarantee corporation approved by theadministrator under the provisions of this act forsuch purpose.

      (f)   It may receive from its members or other insuredcredit unions payments on shares and share certificates and may investits funds in shares, share certificates or other accounts of insured creditunions. Except for investments in corporate credit unions, suchinvestmentsmay not exceed 25% of the investing credit unions' shares, undividedearnings and reserves.

      (g)   A corporate credit union, as defined bysubsection (e) of K.S.A. 17-2231, and amendments thereto,may buy and sell investment securities, asdefined by the administrator, but the total amount of such investmentsecurities of any one obligor or maker held by such credit unionshall at no time exceed 15% of the shares, undividedearnings and reserves of the credit union except that this limit shallnot apply to obligations of the United States government or any agencythereof.

      (h)   Credit unions may enter into agreements to discount or sell student loansmade pursuant to federally insured student loan programs under publiclaw 89-329, title IV part (b) of the higher education act of 1965 asamended.

      (i)   A credit union may discount or sell to suchcorporate credit union orany financial institution or organizationany real estate loan made by the credit union.

      (j)   Credit unions may enter into agreements with acorporate creditunion to discount or sell to such corporatecreditunion any obligation of theUnited States government or any agency thereof, or of any state, municipalityor any agency thereof, if the obligation at thetime of purchase was a legal investment for credit unions.

      (k)   It may provide that shares and share certificates may bewithdrawnfor payment to the account holder or to third parties, in such manner andin accordance with such procedures as may be established by the board ofdirectors.

      (l)   Every credit union incorporated pursuant to or operatingunderthe provisions of this act may exercise such powers, including incidentalpowers, as shall be necessary or requisite to enable it to carry on effectivelythe purposes and business for which it is incorporated.

      (m)   A credit union may receive from the national credit unioncentralliquidity facility created by title III of the federal credit union act,12 U.S.C. 1795, et seq., payments on: (1) Shares which may beissued at varyingdividend rates; (2) share certificates which may be issued atvarying dividendrates and maturities; and (3) investments in any other accounts ofthecredit union. A creditunion may invest its funds in the capital stock of the national credit unioncentral liquidity facility.

      (n)   Subject to written guidelines issued by the administrator,a creditunion may purchase notes made by individual borrowers to a financialinstitutionat such prices as may be agreed upon by the board of directors of the purchasingcredit union. No purchase may be made, however, under authority of thissubsection, unless approved in writing by the administrator, if, upon themaking of that purchase, the aggregate of the unpaid balances of notes ofnonmembers purchased under authority of this subsection would exceed 5%of the shares, undivided earnings and reserves of the credit union.

      (o)   Subject to rules and regulations adopted by the administrator, acredit union, if designated by the administrator as a low-income credit union,may accept payments to share accounts by nonmembers.Such rules andregulations shall specify the maximum level of non-member shares, the use ofsuch shares, the term of such accounts and other requirements to addresssafety and soundness issues. Non-member account holders do not have the samerights and privileges as members.

      History:   L. 1929, ch. 141, § 4; L. 1951, ch. 204, § 1; L.1955, ch. 138, § 1; L. 1968, ch. 160, § 3; L. 1969, ch. 112, § 56; L.1971, ch. 75, § 1; L. 1972, ch. 58, § 1; L. 1974, ch. 98, § 1; L.1975, ch. 136, § 3; L. 1977, ch. 75, § 1; L. 1981, ch. 101, § 2;L. 1982, ch. 103, § 2; L. 1984, ch. 90, § 1;L. 1987, ch. 85, § 1;L. 1992, ch. 225, § 1;L. 1995, ch. 64, § 1; July 1.