C-3 - Act respecting the caisses d’entraide économique

Section 13 Disposition versions

1977-12-31

13. Every union must establish and maintain a general reserve. It shall not be divided among the members in whole or in part.

An amount representing not less than six per cent of the gross annual income of the union must be allocated thereto. However, before such allocation, the following may be deducted from such amount:

(a)  the amount by which the reserve for bad debts on loans to members was increased, at a rate of not more than one-half of one per cent per year of the total amount of the loans to the members, up to the amount which increases the total of the reserve to one and one-half per cent of the total amount of such loans;

(b)  the amount by which the reserve for possible losses on investments contemplated in subparagraphs a to e of section 83 of the Savings and Credit Unions Act was increased, at a rate of not more than one-half of one per cent per year of the total amount of such investments, up to the amount which increases the total of the reserve to one and one-half per cent of the total amount of such investments.

The percentage of six per cent of the annual gross income to be allocated to the general reserve may be reduced to three per cent when such reserve becomes greater than five per cent of the amount represented by the savings, deposits, borrowings of the union and sums paid on shares, as computed at the end of the last fiscal year.

1974, c. 68, s. 13.