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Amendment of section 35 of Principal Act (making of loans)
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18.Section 35 of the Principal Act is amended—
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(a) by the substitution of the following subsection for subsection (2):
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“(2) A credit union may—
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(a) make a loan to a member of the credit union,
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(b) enter into an agreement with one or more other credit unions in accordance with which the credit union agrees to participate in a loan to a member of one of those other credit unions (in this paragraph referred to as ‘the originating lender’) by the originating lender, or
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(c) enter into an agreement between—
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(i) the credit union and one or more other credit unions, and
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(ii) one or more members of—
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(I) the credit union, or
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(II) one of those other credit unions,
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in accordance with which each credit union that is a party to the agreement provides a loan to the member or those members, as the case may be,
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for such purpose as the credit union considers appropriate and upon such security (or without security) and terms as the rules of the credit union may provide.”,
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(b) by the insertion of the following subsection after subsection (2):
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“(2A) The ability of the loan applicant to repay a loan shall be the primary consideration in the underwriting process of the credit union making the loan or participating in the loan, as the case may be.”,
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and
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(c) in subsection (8), by the substitution of “the Bank may prescribe such other requirements, applicable to loans to which this section relates, as it considers necessary in relation to any one or more of the following matters:” for “the Bank may prescribe such other requirements as it considers necessary in relation to any one or more of the following matters:”.
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