Page:United States Statutes at Large Volume 101 Part 1.djvu/619

 PUBLIC LAW 100-86—AUG. 10, 1987

101 STAT. 589

for dividends shall apply to such bank until the bank has purchased all of the excess amount of capital stock. "(B) ALLOCATION OF EXCESS AMOUNT AMONG REMAINING

HOME LOAN BANKS,—The amount each remaining Federal Home Loan Bank shall be required to invest under subparagraph (A)(i) is the amount determined by the Board by multiplying the excess amount by the percentage arrived at by dividing— "(i) the amount of capital stock of the Financing Corporation held by such remaining bank a t the time of such determination; by "(ii) the aggregate amount of such stock held by all remaining banks at such time. "(C) PURCHASE PROCEDURE.—The bank on whose behalf an investment in capital stock is made under subparagraph (A)(i) shall purchase, annually and a t the issuance price, from each remaining bank an amount of such stock determined by the Board by multipl3ring the amount available for such purchases (at the time of such determination) by the percentage determined under subparagraph (B) with respect to such remaining bank until the aggregate amount of such capital stock has been purchased by the bank. "(D) LIMITATION ON DIVIDENDS.—The amount of dividends

which may be paid for any year by a bank on whose behalf an investment is made under subparagraph (A)(i) shall not exceed an amount equal to ¥2 of the net earnings available for dividends of the bank for the year. "(E) TRANSFER TO ACCOUNT FOR PURCHASE OF STOCK RE-

QUIRED.—Of the net earnings available for dividends for any year of a bank on whose behalf an investment is made under subparagraph (A)(i), such amount as is necessary to make the purchases of stock required under subparagraph (A)(ii) shall be placed in a reserve account (established in such manner as the Board shall prescribe by regulations) the balance in which shall be available only for such purchases. "(F) N E T EARNINGS AVAILABLE FOR DIVIDENDS DEFINED.—

For purposes of this paragraph, the term 'net earnings available for dividends means the net earnings of a bank for any period as computed after reducing the amount of earnings for such period by the amount required to be carried (for such period) to reserves maintained by such bank pursuant to the first two sentences of section 16 of this Act. "(7) UNDIVIDED PROFITS DEFINED.—For

purposes of paragraph (3), the term 'undivided profits' means retained earnings minus the sum of— "(A) that portion required to be added to reserves maintained pursuant to the first two sentences of section 16 of this Act; and "(B) the dollar amounts held by the respective Federal Home Loan Banks in special dividend stabilization reserves on December 31, 1985, as determined under the following table:

12 USC 1436.

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