(A) At the end of each accounting period the gross income shall be determined. From this amount, there shall be set aside, as a regular reserve against losses on loans and risk assets sums in accordance with the following schedule: (1) A credit union in operation for more than four years and having assets of $500,000 or more shall set aside (A) 10 per centum of gross income until the regular reserve shall equal 4 per centum of the total outstanding loans and risk assets, then (B) 5 per centum of gross income until the regular reserve shall equal 6 per centum of the total outstanding loans and risk assets. (2) A credit union in operation less than four years or having assets of less than $500,000 shall set aside (A) 10 per centum of gross income until the regular reserve shall equal 7 1/2 per centum of the total outstanding loans and risk assets, then (B) 5 per centum of gross income until the regular reserve shall equal 10 per centum of the total outstanding loans and risk assets. (3) Whenever the regular reserve falls below the stated per centum of the total of outstanding loans and risk assets, it shall be replenished by regular contributions in such amounts as may be needed to maintain the stated reserve goals. (B) The Secretary may decrease the reserve requirement set forth in subsection (A) of this Section when in his or her opinion such a decrease is necessary or desirable. The Secretary may also require special reserves to protect the interest of members. (C) For the purpose of establishing the reserves required by this Section all assets except the following are risk assets: (1) Cash on hand; (2) Real estate; (3) Depreciated value of buildings, furnishings and equipment; (4) Loans to students insured under Title IV, part B of the Higher Education Act of 1965 or the Higher Education Student Assistance Law; (5) Loans insured under Title 1 of the National Housing Act by the Federal Housing Administration; (6) Funds invested as authorized under Section 59 of this Act; and (7) Loans fully secured by a pledge of shares in the lending credit union equal to and maintained to at least the amount of the loan outstanding. years and having assets of $500,000 or more shall set aside (A) 10 per centum of gross income until the regular reserve shall equal 4 per centum of the total outstanding loans and risk assets, then (B) 5 per centum of gross income until the regular reserve shall equal 6 per centum of the total outstanding loans and risk assets. or having assets of less than $500,000 shall set aside (A) 10 per centum of gross income until the regular reserve shall equal 7 1/2 per centum of the total outstanding loans and risk assets, then (B) 5 per centum of gross income until the regular reserve shall equal 10 per centum of the total outstanding loans and risk assets. stated per centum of the total of outstanding loans and risk assets, it shall be replenished by regular contributions in such amounts as may be needed to maintain the stated reserve goals. equipment; of the Higher Education Act of 1965 or the Higher Education Student Assistance Law; Housing Act by the Federal Housing Administration; this Act; and lending credit union equal to and maintained to at least the amount of the loan outstanding.
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