17:9A-180. Industrial obligations

A. A savings bank may invest in bonds, debentures, notes, or other obligations which mature within thirty years from the time of the investment, and which are issued by an industrial company incorporated within and transacting business within the United States,

(1) whose annual consolidated net sales or consolidated gross income has averaged not less than ten million dollars ($10,000,000.00) for the five fiscal years next preceding the investment for which the necessary statistical data is available; and

(2) whose annual consolidated net income available for dividends has averaged not less than one million dollars ($1,000,000.00) for the five fiscal years next preceding the investment for which the necessary statistical data is available; and

(3) whose total consolidated debt, including current liabilities, as shown on its latest published consolidated balance sheet, does not exceed forty per centum (40%) of its gross assets less reserves as shown on such balance sheet; and

(4) whose consolidated current assets, as shown on its latest published consolidated balance sheet, are not less than two and one-half times its consolidated current liabilities as shown on such balance sheet. In computing current assets and current liabilities for the purposes of this paragraph, there shall be eliminated from current assets, cash and United States Government notes, bonds, treasury bills and certificates of indebtedness in an amount not in excess of Federal income and excess profits taxes included in current liabilities, and there shall be eliminated from current liabilities such Federal income and excess profits taxes in an amount not in excess of the amount eliminated from current assets; and

(5) whose consolidated net income for the five fiscal years next preceding the investment for which the necessary statistical data is available after deducting reserves, regularly recurring charges for amortization of discount and expenses allocable to funded debt, and after deducting all other charges except interest, income and profits taxes, has averaged not less than four times the average annual consolidated interest charges during such period; and

(6) whose consolidated net income, computed as prescribed in the next preceding paragraph, has not, in two or more of the five fiscal years next preceding the investment for which the necessary statistical data is available, been less than twice the annual consolidated interest charges during the same years; and

(7) whose consolidated net income, computed as prescribed in paragraph (5) of this subsection, for the last fiscal year next preceding the investment for which the necessary statistical data is available, was (a) not less than three times the consolidated interest charges for such year, and (b) not less than three times the annual consolidated charges on the funded debt outstanding at the time of the investment. For the purposes of this section, "debt" shall exclude all debt which has been called for redemption or which otherwise matures within six months from the time of the investment, and for the payment of which funds have been set aside in trust.

B. "Industrial company" shall for the purpose of this section, include predecessor and constituent corporations, and shall mean corporations engaged in manufacturing, mining, merchandising, commercial financing, and other corporations commonly accepted as industrial companies.

C. No savings bank shall make an investment pursuant to this section at any time when the total of all such investments exceeds, or if the making of such an investment would cause such total to exceed, twenty-five per centum (25%) of its deposits.

D. No savings bank shall make an investment pursuant to this section in any obligation for the payment of which any one industrial company is primarily liable, at any time when the total of all its investments in such obligations of such company exceeds, or if the making of such an investment would cause such total to exceed, two per centum (2%) of its deposits. The acquisition of any such obligation as a result of a refunding or other refinancing or exchange of such obligations theretofore invested in shall not be considered the making of an investment for the purposes of this subsection.

L.1948, c. 67, p. 317, s. 180. Amended by L.1948, c. 405, p. 1606, s. 1.