Honorable W. Sale Lewis Opinion No. M-506
Commissioner,
Texas Savings and Loan Department
P.O. Box 1089
Austin, Texas Re: Whether state chartered
savings and loan associa-
tions may raise capital
through deposit-type ac-
Dear Commissioner Lewis: counts.
In your recent request for an opinion from this office you ask
whether a state chartered savings and loan association may lawfully
accept “deposit-type” accounts, which you describe as a type of sav-
ings deposit at a guaranteed rate of interest. No dividends will be
declared but the depositor does become a voting member of the in-
stitution entitled to a pass book or certificate under a debtor-creditor
relationship. You point out that Section 6. 20 of Article 852a, Vernon’s
Civil Statutes, enacted in 1969 by the 6lst Legislature, provides as
follows:
“Notwithstanding any provision of this Act
to the contrary, an association may raise capital in
the manner and form and pay dividends, earnings or
interest thereon in the manner which the association
could, if it were a federal association as defined in
Section 1. 03(9) of this Act. ”
At the time of the passage of Section 6. 20, federal associations
were authorized to use the deposit-type account. 12 U.S. C. A., Section
1464(b)( 1) provides in part as follows:
“An association may raise capital in the form
of such savings deposits, shares, or other accounts,
for fixed, minimum, or indefinite periods of time
(all of which are referred to in this section as sav-
-2426-
Honorable W. Sale Lewis, page 2 M- 506
ings accounts and all of which shall have the same
priority upon liquidation) as are authorized by its
charter or by regulations of the Board, and may issue
such passbooks, time certificates of deposit, or other
evidence of savings accounts as are so authorized.
Holders of savings accounts and obligors of an associa-
tion shall, to such extent as may be provided by its
charter or by regulations of the Board, be members of
the association, and shall have such voting rights and
such other rights as are thereby provided. ”
This statute has been further implemented by Section 545. l-2, et seq. ,
Rules and Regulations for Federal Savings and Loan Systems.
In addition to Section 6. 20 of the Texas Savings and Loan Act, as
quoted above, the Building and Loan Section of the Finance Commission
has promulgated rules governing both savings accounts and deposit ac-
counts. Rules and Regulations for Savings and Loan Associations, Ch. 9,
as amended.
It is our conclusion that a state-chartered association may raise
capital through such deposit-type accounts as you contemplate. Our
opinion is based on the provisions of the Texas Savings and Loan Act and
the clear declaration of the legislative will in Section 6. 20 as quoted
above. Section 4. 01 of the Texas Savings and Loan Act provides:
“Every association incorporated pursuant to
or operating under the provisions of this Act shall
have all the powers enumerated, authorized and per-
mitted by this Act and such other rights, privileges
and powers as may be incidental to or reasonably
necessary for the accomplishment of the objects and
purposes of the association. ”
Section 6. 01 provides:
“There shall be no limit on the number and
value of savings accounts an association may accept
unless limits are fixed by its board of directors. ”
Section 6. 03 provides, in part:
-2427-
- ,
Honorable W. Sale Lewis, page 3 M- 506
“Each holder of a savings account shall
execute a savings contract setting forth s special
terms and provisions applicable to such account. and
the conditions upon which withdrawals may be made
not inconsistent with the provisions of this Act . ”
(Emphasis added. )
Section 6. 04 provides:
“As evidence of each such savings account
the associations shall issue to the holder of such
account either an account book or certificate. ”
When the above quoted statutes are considered as “in pari material’
(See 53 Tex. Jur. 2d 278, Statutes, Sec. 185), it becomes clear that Texas
savings and loan associations are authorized to raise capital through such
deposit-type accounts as hereinabove described by you. Our opinion, how-
ever, is limited and confined to this premise.
SUMMARY
Deposit-type accounts may be accepted by
state chartered savings and loan associations under
the authority of Sections 4. 01, 6. 03, 6. 04 and 6. 20,
Texas Savings and Loan Act.
/7
DC. MARTIN
eneral of Texas
Prepared by Ralph R. Rash
Assistant Attorney General
APPROVED:
OPINION COMMITTEE
Kerns Taylor, Chairman
George Kelton, Vice-Chairman
-2428-
Honorable W. Sale Lewis, page 4 M-506
Louis G. Neumann
John Banks
Charles Rose
Roy Moue=
Meade F. Griffin
Staff Legal Assistant
Nola White
First Assistant
-2429-