Section 490.115. Overdrafts.

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A credit union that issues a   check or draft on a   financial institution in excess of the balance of its demand deposit account in that institution then shown on the books of the credit union shall be considered to be operating in an unsafe and unsound manner unless all of the following conditions are satisfied:

(a)    The excess is not more than the unused portion of the   current line-of-credit agreements between the credit union and the institution.

(b)   The line-of-credit agreement expressly provides that it will apply   to cover overdrafts by the credit union.

(c)       The board of   directors of   the credit   union has   approved    the line-of-credit agreement.

History: 2005 AACS.

                    
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