(1) For purposes of ARM 2.59.417 and 2.59.418, "net worth" means the sum of regular reserves and undivided earnings. Net worth excludes the allowance for loan and lease losses. Net worth is calculated quarterly based on data from the previous call report.

(2) The department shall determine compliance with ARM 2.59.417 and 2.59.418 using quarterly net worth for the period in which the security is purchased.

(3) A security that complies with ARM 2.59.417 and 2.59.418 at the time of purchase is not in violation of ARM 2.59.417 and 2.59.418 at a later date due to a subsequent decline in net worth.