Sec 6-425. Shares of guaranty capital; authorization of issuance; minimum amount

A. An association may provide for the issuance of shares of guaranty capital, either by its original articles of incorporation or by an amendment thereto.

B. The aggregate initial guaranty capital of an association being organized under this chapter shall be not less than the minimum initial guaranty capital required under the provisions of section 6-407.

C. In the case of an association which shall at any time be operating and its original articles of incorporation authorize the issuance of guaranty shares but the association has issued no guaranty shares, or in the case of an association already in operation which amends its articles to authorize the issuance of guaranty shares, the aggregate initial guaranty capital shall be not less than either:

1. The initial guaranty capital required under the provisions of section 6-407.

2. An amount which, together with the amount of surplus and all reserves required or designated as available for losses, equals in the aggregate not less than the required capital and reserves necessary to obtain and maintain insurance of accounts by the insurance corporation, whichever shall be greater.

D. In the case of an association already in operation and having issued and outstanding guaranty shares, the aggregate guaranty capital shall be an amount not less than an amount which, together with the amount of surplus, amount of outstanding capital notes and debentures, and all reserves required or designated for use for losses, equals in the aggregate not less than the required capital and reserves necessary to obtain and maintain insurance of accounts by the insurance corporation.

E. Any plan for the issuance of shares of guaranty capital shall be subject to the approval of the superintendent as being in conformity with the provisions of this chapter, and the rules and regulations of the superintendent pertaining thereto.