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This entry was published on 2014-09-22
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Liquidation of insured savings and loan associations
§ 420-j. Liquidation of insured savings and loan associations. 1. In
the event that a savings and loan association is in default, the fund
may be appointed by the superintendent as conservator or receiver and as
such, may be authorized by the superintendent (a) to take over the
assets of and operate such association, (b) to take such action as may
be necessary to put it in a sound and solvent condition, (c) to
negotiate for a merger with another insured savings and loan
association, (d) to negotiate the organization of a new savings and loan
association to take over its assets, or (e) to proceed to liquidate its
assets in an orderly manner, whichever shall appear to the
superintendent to be in the public interest. The payment by the fund of
an insured account in any such association which is in default shall
entitle the fund to the rights of the holder of such insured account,
but shall not affect any right which the holder of such account may have
in the uninsured portion of his account or any right which he may have
to participate in the distribution of the net proceeds remaining from
the disposition of the assets of such association.

2. In order to prevent a default in an insured savings and loan
association or in order to restore an insured association to normal
operation as an insured savings and loan association, the fund is
authorized, in its discretion, to make loans to, purchase the assets of,
or make a contribution to, an insured savings and loan association or an
insured savings and loan association in default; but no contribution
shall be made to any such association in an amount in excess of that
which the fund finds to be reasonably necessary to save the expense of
liquidating such association.