Section 21. Fifteen or more cooperative banks may form the Cooperative Banks Employees Retirement Association, in this section and in sections 22 and 23 hereinafter referred to as the retirement association, for the purpose of providing retirement benefits services through retirement plans which are qualified under section 401 of the Internal Revenue Code, in this section hereinafter referred to plans, to employees and customers of members of the association, as hereinafter provided. The retirement association, in its name and by and through its authorized officers, may: (a) establish plans and related trusts for its members; (b) make agreements and investments subject to such limitations as from time to time may be prescribed by law or the by-laws of the retirement association; (c) establish divisions, departments and other operating units within the retirement association and provide the same with appropriate names or other identifications, to assist the retirement association in carrying out the powers conferred upon it by law and its by-laws; (d) sue and be sued, plead and be impleaded; (e) enforce liens and other obligations and foreclose mortgages held by the retirement association on or with respect to real or personal property situated in the commonwealth or in any state or territory of the United States; (f) adopt an official seal and alter the same at pleasure; and (g) do such other acts and things as may be necessary to carry out the powers conferred upon it by law and its by-laws.

Any bank or credit union chartered by the commonwealth, any such bank or credit union which has converted to federal charter and has its main office located in the commonwealth, any bank or credit union chartered by the federal government, by a state of the United States other than the commonwealth or by the District of Columbia and which has its main office or a branch office located in the commonwealth, the Massachusetts Bankers Association and its successors and any bank which is a voting member thereof, the Cooperative Banks Employees Retirement Association, the Co-operative Central Bank, and such other banking institutions with their main office or any branch office located in the commonwealth, as may from time to time be provided for in the by-laws of the association and the respective employees of each of the foregoing, shall be eligible for membership in the association; provided, however, no bank that was eligible to be a member of the association before January 1, 2004, shall be eligible to become a member of the Savings Banks Employees Retirement Association or the Credit Union Employees Retirement Association, unless and until the Savings Banks Employees Retirement Association and the Credit Union Employees Retirement Association permits a member to transfer from any or all of the qualified plans provided by said association, assets and liabilities, attributed to the member's employees, to 1 or more qualified plans not provided by said association. For the purposes of this section, and sections 22 and 23, ''bank'' or ''banks'' shall, unless the context otherwise requires, mean and include any or all of the organizations named or referred to in this paragraph; ''board of directors'' of a bank shall also, unless the context otherwise requires, mean and include the governing body of such organizations; and ''customer'' shall mean any person or business who has established a contractual relationship for banking business purposes with any banking institution located in the commonwealth which is a member of the association.

Eligible employees may contribute a portion of their salaries and wages to or under plans established by the retirement association, to be deducted by the employing banks and paid to the plans or the retirement association. A participating bank may contribute to or under plans of the retirement association to the extent determined by its board of trustees. Contributions and benefits under the plans of the retirement association shall not exceed the limits, if any, imposed on such plans by the Internal Revenue Code of 1954 and the Employees Retirement Income Security Act of 1974, in this section hereinafter referred to as the code and ERISA, respectively.

If the commissioner finds that the continuation of contributions by a participating bank subject to the commissioner's authority may affect its safety and soundness, including reducing its risk-based capital ratio below any prescribed regulatory level, said commissioner may order the bank to: (a) freeze its benefits and cease further funding for future benefit accruals under any plans qualified under section 401 of the federal Internal Revenue Code; (b) revise its benefits for future service under any such plans so that contributions on account of any employee will be limited to an appropriate percentage of compensation; or (c) terminate its participation in any such plans.

All plans maintained by the retirement association shall conform to the code and ERISA and funds held under any such plans shall be invested in a manner as the retirement association shall determine. Copies of all plans shall be filed with the commissioner. Funds held under any of said plans shall be held by or used by the retirement association to the extent required by the code and ERISA for the exclusive purpose of providing plan benefits to participating members; provided, however, to the extent permitted by law, funds of the plans may be used to defray reasonable expenses of administering the retirement association and the plans, and expenses of investing the assets of the plans may be charged against the funds of the plans. To the extent that expenses necessary for the administration of the retirement association or the plans are not paid from the plans, they shall be paid by participating banks on a proportionate basis, as provided in the by-laws of the retirement association. The association shall annually provide to each member a report of assets and liabilities attributable to its participants in any or all qualified plans adopted by a member.

A participating bank, by vote of its board of directors, and a customer may adopt 1 or more of the plans of the retirement association for the benefit of its employees. Any bank which has adopted a plan of the retirement association for its employees may, if it is otherwise eligible, also establish an employee stock ownership plan.

A bank, by vote of its board of directors, may directly or indirectly by means of a contribution to 1 or more of the trust funds held by the trustees of the retirement association supplement the retirement benefits being paid to its former employees or their beneficiaries on account of bank service; provided, however, no supplement of a retirement benefit shall exceed the retirement benefit multiplied by the increase in the cost of living since the retirement began. The increase in the cost of living is the percentage by which the national monthly consumer price index for all urban consumers, issued by the bureau of labor statistics of the United States Department of Labor, for the last November before the year in which payment is made is greater than the beginning index figure. The beginning index figure is the average of such monthly consumer price index figures for the year in which a retirement benefit was first paid to or with respect to a former employee. Except with respect to supplements first voted by a financial institution's governing board on or after January 1, 1981, and which are paid through 1 or more of the trust funds held by the trustees of the retirement association, no employing unit may become obligated to pay in future years any supplement authorized by this paragraph.

Membership in the association is voluntary and any bank may establish or provide qualified retirement plans for its employees independent of the association; provided, however, nothing contained herein shall be construed as requiring any bank to provide qualified retirement plans to its employees.