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Approval of loans.
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36.—(1) A credit union shall not make a loan to a member unless it is approved in accordance with this section.
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(2) Subject to subsections (3) and (5), a loan must be approved, according as the rules of the credit union require—
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(a) by such number of members of the board of directors voting by secret ballot at a meeting of the board at which the application for the loan is considered as represents at least two-thirds of those present and a majority of the members of the board as a whole; or
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(b) by such number of members of the credit committee present at a meeting of that committee at which the application for the loan is considered as represents at least two-thirds of those present and a majority of the committee members as a whole; or
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(c) by a credit officer.
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(3) Subject to subsection (5), a loan to a non-qualifying member may not be approved except as set out in subsection (2)(a) and a loan to an officer must be approved by not less than two-thirds of the members of a special committee voting by secret ballot at a meeting at which the application for the loan is considered.
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(4) The special committee referred to in subsection (3) shall consist of—
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(a) a majority of the board of directors, and
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(b) at least one member of the credit committee, and
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(c) at least one member of the Supervisory Committee,
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but shall not include the applicant for the loan.
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(5) Notwithstanding the provisions of subsection (3), a loan to an officer or a non-qualifying member which does not exceed the value of his savings may be approved as mentioned in paragraph (b) or paragraph (c) of subsection (2).
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(6) If a credit union knowingly contravenes subsection (1), it shall be guilty of an offence.
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