A. As used in this section, "executive officer" means an officer of a savings institution who participates or has authority to participate in the major policy-making functions of the savings institution.

B. No executive officer or director of any savings institution shall borrow any amount more than $25,000 from the institution until such loan has been approved by (i) a majority of the directors of the institution or (ii) a committee of officers and directors that includes at least one director appointed by the board of directors with authority to approve loans.

C. The following loans or lines of credit shall not be made by an institution unless specifically approved by (i) a majority of the directors of the institution or (ii) a committee of officers and directors that includes at least one director appointed by the board of directors with authority to approve loans:

1. Any loan in an amount of $25,000 or more made to any executive officer or director of an institution or any entity that the Commission determines is controlled by one or more executive officers or directors;

2. Any loan made to the persons or entities described in subdivision 1, the amount of which together with all other obligations, direct or indirect, of such executive officer, director, or controlled entity is $100,000 or more;

3. Any line of credit for $25,000 or more made to the persons or entities described in subdivision 1; or

4. Any line of credit made to the persons or entities described in subdivision 1, the amount of which together with all other obligations, direct or indirect, of such executive officer, director, or controlled entity is $100,000 or more.

If approved by the committee described in clause (ii), the approval shall be specifically reported to the board of directors at its next regular meeting.

D. No extension, renewal, or renegotiation of any loan or line of credit in excess of the amounts described in subsection C shall be made to any of those individuals or entities or their interests unless it is approved by a majority of the board of directors or by the committee of officers and directors appointed by the board. If approved by the committee, such approval shall be specifically reported to the board of directors at its next regular meeting.

E. The prohibitions set forth in subsections C and D shall not be construed to require approval by the board of directors for advances under previously authorized lines of credit.

F. The aggregate amount of a savings institution's loans to its executive officers or directors or their interests shall not be excessive. The Commission may adopt such regulations as may be required to prevent excessive aggregate amounts of lending by savings institutions to those individuals or entities.

1982, c. 103, § 6.1-195.40:1; 1985, c. 425, § 6.1-194.21; 1995, c. 83; 1996, c. 13; 2010, c. 794.