New York Codes, Rules and Regulations
Title 3 - BANKING
Legal Interpretations
LI 4 - Savings Banks and Savings and Loan Associations
Section LI 4.15 - Deposits in savings banks by cooperative corporations

The department was asked whether a savings bank could accept the deposits of a cooperative corporation, organized under the Cooperative Corporations Law, in view of section 237.2 of the Banking Law, which provides that a savings bank may not accept deposits from any "partnership, corporation or other organization for profit".

The department replied that section 237.2 has always been understood to prohibit only deposits of corporations "for profit". General Construction Law, section 65(c) (3) provides that a cooperative corporation is a corporation "formed other than for profit". Section 66.12 of the General Construction Law defines a cooperative corporation as a corporation "to which the cooperative corporations law is made applicable by a provision of such law". Section 3(d) of the Cooperative Corporations Law provides as follows:

"A cooperative corporation shall be classed as a non-profit corporation, since its primary object is not to make profits for itself as such, or to pay dividends on invested capital, but to provide service and means whereby its members may have the economic advantage of cooperative action, including a reasonable and fair return for their product and service."

In view of the foregoing statutory definitions, the department is of the opinion that a cooperative corporation is not a corporation "for profit" whose deposits would be excluded, and therefore a savings bank may accept the deposit of a cooperative corporation.

DATED: October 1975