17:9A-175. Federal, State, county and municipal securities

A. A savings bank may invest in

(1) stocks, bonds, and notes or obligations of or guaranteed by the United States, or those for which the credit of the United States is pledged for the payment of the principal and interest or dividends thereof;

(2) bonds or obligations of or guaranteed by this State or heretofore authorized by the laws of this State to be issued pursuant to any law of this State; by any commission appointed by the Supreme Court of New Jersey, as the said court was constituted prior to September 15, 1948;

(3) bonds, notes or obligations of or guaranteed by any other State of the United States which has not, within 10 years prior to the making of the investment, defaulted in the payment of any part of the principal or interest of any debt evidenced by bonds, notes or obligations;

(4) bonds, notes or obligations of any county, municipality, public school district, union graded school district, regional board of education, water district, sewer district, or other municipal or political subdivision of this State, issued pursuant to a law of this State; provided, that, the issuer has not, within 5 years prior to the making of the investment, been in default for more than 6 months in the payment of any part of the principal or interest of any debt evidenced by its bonds, notes or obligations;

(5) bonds, notes or other obligations issued, guaranteed or assumed by any municipality, county, school district, water district, sewer district or other municipal or political subdivision of any other State of the United States; provided, (a) that any such municipality, county, school district, water district, sewer district or other municipal or political subdivision of any other State of the United States, or the total of its component parts, shall have a population as shown by the last preceding Federal census of not less than 25,000; and (b) the issuer, guarantor or assumer of such bonds, notes or other obligations

(i) shall have pledged its faith and credit for the payment of the principal and interest of such bonds, notes or other obligations, and

(ii) shall have the power to levy taxes on the taxable real property therein for the payment of both principal and interest of such bonds, notes or other obligations without limitation of rate or amount, and

(iii) shall not within 10 years prior to the making of the investment have defaulted in payment of principal or interest of any debt evidenced by its bonds, notes or other obligations for more than 60 days.

(6) bonds, including consolidated bonds, or other obligations, issued by Federal land banks, and debentures, including consolidated debentures, or other obligations, issued by Federal intermediate credit banks or banks for cooperatives organized under the laws of the United States;

(7) bonds, debentures or other obligations issued by the Home Owners' Loan Corporation, Federal Home Loan Banks or by any other agency or administration succeeding to its functions or powers, under the Act of Congress of June 13, 1933, known as the "Home Owners' Loan Act of 1933," as amended or supplemented from time to time;

(8) bonds, debentures or other obligations issued by any national mortgage association under the Act of Congress of June 27, 1934, known as the "National Housing Act," as amended or supplemented from time to time;

(9) bonds, debentures or other obligations issued by The United States Postal Service under the Postal Reorganization Act, Public Law 91-375, 84 Stat. 719, as amended or supplemented from time to time;

(10) bonds issued, guaranteed or assumed by any governmental unit, which, if issued, guaranteed or assumed by a private company, would be legal for investment under any of the provisions of this article; and

(11) other investments presently or from time to time hereafter authorized by law.

B. No savings bank shall make an investment pursuant to any one of paragraphs (6), (7), (8) or (9) of subsection A of this section at any time when the total of all investments of the nature authorized by such paragraph exceeds, or if the making of such an investment would cause such total to exceed, 2% of its deposits; provided, however, investments under paragraph (6) hereof may be in the amount of 2% of each of the agencies referred to therein when the maturities of any such obligations are within 1 year. No savings bank shall make an investment pursuant to paragraph (10) of subsection A. of this section in the bonds of any one such governmental unit at any time when the total of all its investments in such bonds of such unit exceeds, or if the making of such investment would cause such total to exceed, 2% of its deposits. The acquisition of any such investment as a result of a refunding or other refinancing or an exchange of any investment authorized by such paragraphs shall not be considered the making of an investment for the purposes of this subsection.

C. A savings bank may make short term investments limited to a 1-year term in

(1) certificates of deposit in any bank whose stock qualifies as legal investment for savings banks;

(2) in United States Government securities and bonds or obligations of United States Governmental agencies otherwise legal investments hereunder, subject to repurchase agreements.

L.1948, c. 67, p. 304, s. 175. Amended by L.1952, c. 278, p. 947, s. 1; L.1957, c. 85, p. 163, s. 1; L.1963, c. 83, s. 1; L.1964, c. 70, s. 1; L.1971, c. 396, s. 1, eff. Jan. 10, 1972.