!f;
The Commoner.
APRIL 2, 1909
ing each year according to the form which may
bo prescribed by said board, "which reports shall
be verified by the oath or afllrmation of the presi
dent, vice president or cashier, and in addition
two of the board of directors. But the officer
administering the oath or afllrmation to the per
scn verifying such report shall bo in no way In
tel ested in such bank as an officer, director or
stockholder.
Sec. 18. Tho reports provided for in section 17
of this act shall state tho amount loaned upon
bonds and mortgages; tho amount loaned upon
notes, bills of exchange, overdrafts, and other
personal securities, with the actual market value
of such securities; tho amount of rediscounts and
of commercial paper past due; tho amount In
vested in real estate, giving tho cost of tho same;
the amount of cash on hand and on deposit in
banks or trust companies with their names and
the amount deposited in each'; the amount of all
other assets not enumerated above, and such other
information as the state banking board may re
quire. Provided, that commercial paper not in
process of collection, six months past due, and
demand paper carried one year with Interest
unpaid, shall not bo included in the report
of tho assets of such corporation. Each report
shall state such resources and liabilities at tho
close of business on any past day by the stato
banking board specified and shall bo transmitted
to said board within five days after tho receipt of
a request or requisition therefor. And a summary
of such report In the form prescribed by tho stato
banking board shall bo published in tho placo
where such banking business is transacted, or if
there is no newspaper in tho place, then In one
published in the same county, at the expense, of
such bank; and proof of such publication shall bo
transmitted to tho stato banking board within
twenty (20) days from tho date fixed for such
report.
Sec. 19. Any corporation transacting a bank
ing business under this act, shall bo required to
furnish such special reports as may bo required
from tho state banking board, or the chairman
thereof, to enable such board or chairman to ob
tain full and complete knowledge of the condition
of such corporation.
Sec. 20. Any corporation, that shall fail, neglect
or refuse to make or furnish any report, or any
published statement required by tho provisions
of this act, or that shall transact a banking busi
ness without first obtained a charter there
for, and the certificate provided for in section 14 of
this act in accordance with the provisions of this
act, shall be subject to a fine or penalty of fifty dol
lars ($50) per day for each day after tho time
named for said report or statement to bo made, that
it delays to make and transmit such report or
statement to tho state banking board; and for each
day on which any such corporation, shall be en
gaged in transacting a banking business in viola
tion of the provisions of this act. Tho fine or
penalty herein provided for shall be recovered by
the state, in a civil action in any court of com
petent jurisdiction, and it is hereby made tho duty
of the attorney general to enforco the fine or
penalty herein provided.
Sec. 21. Any person who shall wilfully and
knowingly subsorlbe to, or make, or cause to bo
made, any false statement or false entry in tho
books of any corporation transacting a banking
business under this act, or shall knowingly sub
scribe to or exhibit falso papers, with the intent
to deceive any porson or persons authorized to
examine into the affairs of any such corporation,
or shall make, state or publish any false state
ment of the amount of assets or liabilities
of any such corporation shall be deemed guilty of
a felony and upon conviction thereof shall be im
prisoned in tho state penitentiary not less than
one (1) year nor more than ton (10) years.
Sec. 22. Every bank shall at all times havo
on hand as a reserve in available funds an amount
equal to at least fifteen (15) per cent of tho
aggregate 'amount of Its deposits. Two-fifths
of said fifteen (15) per cerit shall be cash in tho
vaults of tlfeGbank; provided, that In cities having
a population of more than twenty-five thousand
($25,000) said reserves shall be twenty (20)
per cent of the aggregate amount of tho deposits;
two-fifths of said twenty (20) per cent shall
bo cash In vaults of the bank; provided, further,
that savings banks shall have on hand at all times
as a reserve in available funds an amount equal
to at least five (5) per cent of their aggregate de
posits. So much of said reserve fund as is not
herein required to bo kept incash in the vaults
of the bank shall be kept In such depositories
as may be apprbved by the state banking board.
Sec. 23. The available funds shall consist of
cash on hand and balances due from other solvent
banks. Cash shall include lawful money of the
United States, and exchange for any clearing house
association. Whenever the available funds of any
bank shall fall below the reserve herein required,
such bank shall not make any new loans or dis
count otherwise than by discounting or purchas
ing bills of exchange payable at sight; nor shall
such bank make any dividends of its profits until
it has on hand the available funds required by this
act. Tho state banking board may notify any bank,
in case- its reserve shall fall below the amount re
quired, or its capital is Impaired, to make good
such reserve, or capital within such time as tho
stato banking board may direct, and any failure
of such bank to make good any deficiency in tho
amount of Its reserve, or Its capital, within tho
time directed, shall be cause for the appointment
of a receiver as hereinafter provided.
Sec. 24. The aggregate amount of tho redis
counts and bills payable of any corporation trans
acting a banking business in this state, shall at
no time exceed two-thirds (2-3) of its paid-up
capital, except for payment of its depositors, nor
shall any bank other than savings banks at any
time permit Its loans and investments, exclusive
of its reserve and banking house and fixtures, to
exceed in the aggregate, eight times the amount
of its capital and surplus.
Section 25, No corporation transacting a bank
ing business shall make any loan or discount on
the security of the shares of its own capital stpek,
nor bo the purchaser or holder of any such shares,
or the shares of any corporation, unless such se-.
curity or purchase shall be necessary to prevent
loss upon a debt previously contracted in good
faith; and such stock so purchased or acquired
shall within six (6) months from the time of its
purchase be sold or disposed of at public or private
Bale; or in default thereof, a receiver may bo ap
pointed to close up the business of .tho bank. Pro
vided, that in no case shall tho amount of stock
so held, exceed ten (10) per cent of tho paid up
capital of such bank.
Sec. 26. Tho affairs and business of any bank
ing corporation transacting business under tho
laws of this stato, shall be managed or controlled
by a board of directors of not less than thrco
and not more than fifteen members, who shall
bo selected from tho stockholders, at such tlmo
u i such manner as may bo provided by tho
by-laws of tho corporation and in conformity with
the provisions of this act. Tho board shall select
from among Its number, the president and sec
retary, and shall select a cashier. Such officers
shall hold their office for a term of ono year and
until their successors arc elected and qualified.
The board of directors shall have power to re
quire tho cashier and any or all its officers having
ca? .of tno funds of tho bank, to givo good and
sufficient bond, which bond shall run to tho bank
ing corporation, to bo approved by the board of
directors and held by tho stato banking board.
Tho board of directors shall hold at least two
regular meetings each year, and that such meet
ings, a thorough examination of the books, rec
ords, funds and securities held by tho bank shall
bo mado and recorded in detail upon its record
book, and a certified copy thereof shall bo for
warded to tho secretary of tho state banking board
within ten days.
Sec. 27. No banking corporation transacting a
banking business under this act shall pay interest
on deposits directly or indirectly at a greater
rate than four per cent per annum. Any officer,
director or employe of a bank violating tho pro
visions of this section directly or indirectly, shall
bo deemed guilty of a felony and on conviction
thereof shall be punished by a fine of not less than
ono hundred ($100.00) dollars or more than fivo
hundred dollars ($500.00), or by imprisonment in
tho state penitentiary not exceeding three (3)
years, or both in the discretion of the court.
Sec. 28. Any corporation transacting a banking
business under this act, may semi-annually dcclaro
a dividend of so much of tho net profits an it may
deem expedient, but such corporation shall, before
tho declaration of a dividend, carry one-fifth part
of its net profits to its surplus fund, until tho
same shall amount to twenty (20) per centum of
its paid up capital stock.
Sec. 29. Any corporation 'ransacting a banking
business under this act may purchase, hold and
convey real estate for tho following purposes only:
Such as is necessary for convenient transaction of
its business, not exceeding in value ono- third of
the paid up capital; such as shall bo con
veyed to it for debts duo the bank, and
such as it shall purchase at salo under
judgments or decrees upon its securities, but
the bank at such salo shall not bid a larger amount
than to satisfy its debt. No real estate so ac
quired in satisfaction of debts or at a salo upon
its judgments or decrees shall bo held longer than
five (5) years and within thirty days thereafter
must be sold at private or nubile salo, and at no
tlmo shall the total amount of real estato held
by any bank for any purpose exceed fifty (60) per
cent of the paid up capital of such bank. Savings
banks shall not bo subject to tho provisions of
this section.
Sec. 30. No, corporation, transacting a banking
business under this act shall accept or recelvo
on deposit for any purpose any money, bank
bills, United States .treasury notes or currency,
or other notes, bills, checks, drafts, credits
or currency, when such corporation is In
solvent, and If any corporation transacting
a banking business under this act shall
recelvo or accept on deposit any such de
posits when said corporation Is insolvent,
the officer, agent or employe knowingly receiving
or accepting, or being accessory -to, or permitting
or conniving at tho receiving or accepting on
deposit therein or thereby any such deposit as
aforesaid, shall be guilty of a felony, and upon
conviction thereof shall be punished by imprison
ment in the penitentiary not less than ono year
nor more than ten years.
Sec. 31. It shall be unlawful for two or moro
banks, transacting a banking business In the same
city, town or village in this stato to havo or uso
tho same name, or names so nearly alike as to
cause confusion in transacting business, and In
all cases where such similarity of names now ex
ists, or may hereafter exist, complaint may bo
made to tho state banking board, and if, in tho
judgment of said board, such a similarity does
exist, and does create confusion in conducting
the business of either or both of said banks, then
said board may require tho junior bank in time
of organization to so change or modify its name
as to prevent such confusion, and the change of
namo so mado shall be approved by said banking
board.
Sec. 32. No officer other than a director, who
is not an officer and no employe of any corporation
transacting a banking business under this act
shall be permitted to borrow any of the funds
of the bank directly or indirectly, and no director
of a bank shall be permitted to borrow any of
tho funds of tho bank without first having secured
the approval of the board of directors at a meeting
thereof, the record of which shall bo made and
kept as part of tho records of said bank.
Any officer, director or employe of a corporation
transacting a banking business under this act,
who shall violate the provisions of this section
or who shall aid, abet or assist in a violation
thereof, shall be deemed guilty of a felony, and
on conviction thereof shall be punished by a fine
not exceeding one thousand dollars ($1,000) or
imprisonment in the penitentiary not to exceed
five (5) years, or both in tho discretion of the
court.
Sec. 33. No corporation transacting a banking
business in this state shall directly or indirectly,
loan to any single corporation, firm or individual,
including in such loan all loans made to the sev
eral members or share-holders of such firm or
corporation, for the use and benefit of such firm,
corporation or Individual, more than twenty per
cent (20 per cent) of the paid up capital and
surplus of such bank, but the discounting of bills
of exchange, drawn In good faith, against actually
existing values, and the discount of commercial
paper actually owned by the persons negotiating
tho same, shall not be considered as money bor
rowed, and in no case shall the total liabilities of
the several shareholders of any bank, to such
bank exceed fifty per cent of the paid In capital.
and surplus of such bank. Any officer, .director,
pr omployo of any corporation transacting a bank
ing businoss under tho laws of this state, who
!aI1vIoV4' or k"?wingly permit a violation of
tho provisions of this section, upon conviction
thereof shal bo punished by a flno not oxcecdlng
fivo hundred ($500) dollars. Provided, however,
that tho provisions of this section shall not apply
f tho fecurltloB of the savings banks onumoratcd
in section 30 of this act.
Sec. 34. No corporation transacting a banking
business under this act shall withdraw, or permit
to bo withdrawn either in tho form of dividends
or otherwise, any part of its capital. If losses
havo at any tlmo been sustained, equal to or ex
ceeding undivided profits on hand no dlvldond
?ftiL,b? n!a(!o: nM,no dividend shall bo mado
by any bank transacting a banking business undor
to laws of this state, to an amount greater than
,VfOn.0topr0.n,t8i on hand lcHH th0 ,osso and bad
debts; Provided, howovor, that tho capital stock
may bo increased or decreased, In tho mannor
following: First, tho stockholders at any regular
meeting, or at any special mooting duly cal.od for
such purpose shall by a voto of thoso owning two
thirds of the capital stock, authorize tho presldont
or cashier, to notify the stato banking board of tho
proposed reduction or Increaso of capital and a
notice containing a statement of tho amount of
such proposed reduction or Increaso of capital
shall be published for four (4) weeks In bo mo
newspaper published and of general circulation
'. MlC0lIny,yh,erc,8Uch bank Is located. But no
reduction shall be to any amount lean than tho
capital required by this act, and thero shall bo
.fnCwUF$lon ,c capital or cancellation of stock,
until riaid reduction or cancellation shall first bo
approved by the stato banking board. Provided,
that no reduction of capital or cancellation of stock;
shall bo made that will Impair tho security of the
depositors, and no increaso shall bo authorized
by tho stato bank ng board until a statcmont shall
l?,1300" J"cd W ald !,0fird' thnt tl' Proposed
iVfSS? oiCftip,,tal nas boon pa,d ln and said
atatcment shall bo Bworn to by tho president or
caslilor. Second, whenever any corporation trans
acting a banking business In this stato shall do
slro tp go Into voluntary liquidation, they shall
first obtain tho written consent of tho stato bank
Inff board, who may, if they deem It advisable,
beforo granting such request, order n special ox
am nation mado of tho affairs of such bank, for
which tho same fees may bo collected as in reg
ular examination.
Sec. 35. Every stockholder in tho banking cor
poration or Institution shall bo Individually re
sponsible and liable to Its creditors, over and above
t o amount of stock by him held, to an amount
equal to hie i respective stock or shares so held,
for all its labilities accruing while ho remains
such stockholder, and in caso any person holding
any stock In any banking corporation shall sell,
transfer or dispose of such stock, knowing that
such bank is insolvent, he shall bo deemed tho
owner of such stock, and liable thereon the samo
as if such stock had not been sold, transferred or
disposed of; and such liability may be enforcod
judged insolvent without regard to tho proba-,
sufficient to pay all of its liabilities.
Sec. 36. Any corporation, designating Its bus
iness as that of a savings bank shall have power
to carry on a savings bank business, as prescribed
and limited in this act. Any savings bank may
receive deposits from tho general public, and all
deposits in any bank shall be paid to depositors,
or their lawful representatives when required and
at such time and with such interest and under
such regulations as shall bo prescribed by said
bank and approved by tho state banking board,
which regulations shall bo printed and conspicu
ously posted In some place accessible and visible
to all persons I:; tho business office of said bank.
Tho loanable funds of any savings bank, except
tho reserve provided for In this act, shall bo in
vested in bonds of the United States, or of any
state of tho United States or in tho public
debt or bonds of any city, county, township
village or school district of any state of
the United States, which shall havo been
authorized by tho legislature of tho state,
or when approved by the state banking board in
other bonds of known marketable value, or shall
bo loaned on negotiable paper, secured by any of
tho above mentioned classes of security, or upon
notes or bonds secured by mortgage Hen upon un
incumbered real estate; Provided, That second .
mortgage loans may be mado on Improved farm
lands, but no loans shall be made on such Im
proved farm lands, or other real estate which In-,
eluding the aggregate amount of incumbrance
thereon, shall exceed 50 per cent of tho cash valuo
thereof, or upon notes secured by collateral se
curity of known marketable value, or held as cash,
or shall bo deposited In good solvent banks; Pro
vided, That chattel mortgages shall not bo deemed
collateral security and savings banks arc hereby
prohibited from Investing their funds in them.
Sec. 37. A pass-book shall bo issued to each
depositor in a savings bank for all money deposited
on an open account. Such pass books shall con
tain tho rules and regulations adopted by such
savings bank governing such deposits. In such
pass books shall bo entered each deposit mado .
by, and each payment made to such depositor, and
no deposit shall be received nor payment mado
unless in the pass book at the tlmo such trans
action is had. Provided, that nothing In this sec
tion shall prohibit a savings bank from Issuing
certificates for legitimate deposits. Provided
further, when any deposit is made in any savings
bank by a person being a minor, the said bank
may pay to sue . depositor such sums as may bo
due to him or her, and tho receipt of such minor
to such savings bank shall be in all respects valid
in law.
Sec. 38. The president and cashier, or the busi
ness manager, of every corporation transacting
a banking business under this act shall cause to
be kept at all times a full and correct llBt of the'
names and residences of all the stockholders in
the corporation, tho number of shares held by each,
and the amount of paid up capital represented by
the shares held by each membejL Such list shall
be subject to the inspection ofall stockholders
and creditors of the bank, during business hours:
of each day on which business may be legally
transacted. Such list shall be kept in tho office
of the banking corporation where its business is
transacted, and where all stockholders and credi-
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