§ 933.20 - Stock purchase.

(a) Minimum stock purchase. (1) Each member shall purchase stock in the Bank in which it is a member in an amount equal to one percent of the member's aggregate unpaid loan principal, but not less than $500.

(2) If a member has less than 30 percent of its total assets in home mortgage loans, it shall purchase stock in an amount that would be required under paragraph (a)(1) of this section if at least 30 percent of such member's total assets were home mortgage loans.

(b) Timing of minimum stock purchase. (1) Within 60 calendar days after an institution is approved for membership in a Bank pursuant to § 933.3 of this part, or an institution is automatically approved for membership pursuant to § 933.4 (a) or (d) of this part, the institution shall purchase its minimum stock requirement as set forth in paragraph (a) of this section.

(2) At the election of an institution approved for membership, including those automatically approved under § 933.4 (a) or (d) of this part, the institution may purchase its minimum stock requirement in installments, provided that not less than one-fourth of the total amount shall be purchased within 60 calendar days of the date of approval of membership, and that a further sum of not less than one-fourth of such total shall be purchased at the end of each succeeding period of four months from the date of approval of membership.

(c) Commencement of membership. An institution that has been approved for membership shall become a member at the time it purchases its minimum stock requirement or the first installment thereof pursuant to this section.

(d) Failure to purchase minimum stock requirement. If an institution that has submitted an application and been approved for membership fails to purchase its minimum stock requirement or its first installment within 60 calendar days of the date of its approval for membership, such approval shall be null and void and the institution, if it wants to be a member, shall be required to submit a new application for membership.

(e) Reports. The Bank shall make quarterly reports to the Board setting forth purchases by institutions approved for membership of their minimum stock requirement pursuant to this section.