of its home office, and shall at the end of each fiscal period transfer to its This section was added to the Bank Act May 15, 1919 (Stats. 1919, ARTICLE II. $60. Capital stock of savings banks. Banks not affected. § 61. Purchase of real and personal property by savings banks. 62. Savings banks not to trade in real property. Drafts. Borrow- § 63. Certificates of deposit, issue of. Time certificates. $64. Time and condition of repayment of deposits. Reserve fund. § 65. No loans to director or officer. Loans to another bank owned $66. No loan exceeding 50 per cent of stock. Renewal of loan. $681. Deposits of deceased persons may remain in savings banks. § 60. Capital stock of savings banks. Banks not affected. Every (a) Twenty-five thousand dollars, if its principal place of business is located in any locality the population of which does not exceed five thousand persons; (b) Fifty thousand dollars if its principal place of business is located in any city the population of which is more than five thousand persons, but does not exceed twenty-five thousand persons; (c) One hundred thousand dollars if its principal place of business is (d) Two hundred thousand dollars if its principal place of business (e) Three hundred thousand dollars if its principal place of business Excepting that any savings bank organized without capital stock must have a reserve fund of at least one million dollars. Until the capital stock or reserve fund hereinbefore required shall be actually paid in, the superintendent of banks shall refuse to issue the eertificate required by this act. Banks not affected. The foregoing classification shall not apply to any savings bank already in existence which has received its certificate to do a banking business from the superintendent of banks; nor to any bank the location of which shall have been included by annexation or consolidation within the limits of a city of a class requiring a larger capitalization, but no bank thus excepted shall be permitted to establish any new branch office as provided in section nine of this act or to remove its place of business from the original limits of the city or township wherein it was located prior to such annexation or consolidation until it shall have the capital required of banks in such city not within said exception. Such excepted banks may not in any case decrease their capital stock, but may increase the same in the manner provided by law to an amount either greater or less than that required of banks in such city not within said exception; provided, that nothing herein shall be construed to affect the provisions of section nineteen of this act relative to the proportion of capital and surplus to deposits or of section twenty-three of this act relative to the capital stock required of banks doing a departmental business. Population. The provisions of section twenty-three of this act, as to population, shall apply to any bank organized under the provisions of this section; provided, however, that nothing herein contained shall prevent the superintendent of banks in the exercise of his discretion from granting his license to any bank hereafter organized in a locality which has been included by annexation or consolidation within the limits of a city requiring a larger capitalization with a capital stock paid up in cash equal to that which would have been required for said locality if it had not been included by annexation or consolidation within the limits of a city requiring a larger capitalization; provided, that no bank so licensed shall be permitted to establish any branch office as provided in section nine of this act or to remove its place of business from the original limits of the city or township which has been included by annexation or consolidation within the limits of a city requiring a larger capitalization until it shall have the capital required of banks in such city requiring said larger capitalization. [Amendment approved June 3, 1921; Stats. 1921, p. 1385.] This section was also amended in 1911 and 1913. Stats. 1911, p. 1012; 1913, p. 160. § 61. Purchase of real and personal property by savings banks. 1. The lot and building in which the business of the bank is carried on; furniture and fixtures, vaults and safe deposit vaults and boxes and other personal property such as may be necessary or proper to carry on its banking business; such lot and building, furniture and fixtures, vaults and safe deposit vaults and boxes shall not, in the aggregate, be carried on the books of such bank as an asset to an amount exceeding its paid-up capital and surplus; and hereafter, the authority of a two-thirds vote of all of the directors shall be necessary to authorize the purchase of such lot and building, or the construction of such building. 2. Such as may have been mortgaged, pledged or conveyed to it in trust for its benefit in good faith, for money loaned in pursuance of the regular business of the corporation. 3. Such as may have been purchased at any sales under, pledge, mortgage, or deed of trust made for its benefit for money so loaned and such as may be conveyed to it by borrowers in satisfaction and discharge of loans made thereon. 4. Bullion. Gold or silver bullion, and United States mint certifi cates of ascertained value. 5. Bonds. Bonds and other securities of the following classes: (a) U. S. bonds. Bonds or interest-bearing notes or obligations of the United States, or those for which the faith and credit of the United States are pledged for the payment of principal and interest, or those issued under the authority of the United States. (b) California bonds. Bonds of the state of California, or those for which the faith and credit of the state of California are pledged for the payment of principal and interest, or those of any county, city and county, city or school district of this state; (c) Bonds of other states. Bonds or stocks or notes of any state in the United States, other than the state of California, that has not, within twenty-five years previous to making such investment by such bank, defaulted in the payment of any part of either principal or interest, or those of any county, city and county, city or town, or school district, in any state in the United States other than the state of California, issued under authority of any law of such state, which county, eity and county, city or town, or school district, had, as shown by the federal or state census next preceding such investment, a population of more than twenty thousand inhabitants; provided, however, that the entire bonded indebtedness of such county, city and county, city or town, or school district, including such issue of bonds or stocks or notes, does not exceed fifteen per centum of the value of the taxable property therein as shown by its last equalized assessment-roll; and provided, further, that such county, city and county, city or town, or school district, or the state in which it is located has not defaulted in payment of any part of either principal or interest due upon any legally authorized bond or stock or note issue within twenty-five years next preceding such investment; (d) District bonds. Bonds of any district organized under the laws of the state of California which are required to be and are investigated and approved by a commission now or hereafter authorized by a law of this state to conduct such investigation and give such approval and by authority of which approval said bonds are declared to be legal investments for savings banks; (e) Secured notes or bonds. Notes or bonds secured by mortgage or deed of trust, payment of which is guaranteed by a policy of mortgage insurance, and mortgage participation certificates, issued by a mortgage insurance company in accordance with the provisions of chapter eight of title two of part four of division first of the Civil Code; (f) N. Y. and Mass. Bonds legal for investments by savings banks in the state of New York or the state of Massachusetts; 6. Bonds and other securities of the following classes; provided, that such bonds or securities shall first have been certified by the superintendent of banks after an investigation as provided for under section sixty-one a of this act: (a) Foreign government bonds. Bonds or interest-bearing notes or obligations of any foreign country or government, or those for which the faith and credit of any foreign country are pledged for the payment of principal and interest; (b) Irrigation district bonds of other states. Bonds of any district organized under the laws of any state in the United States other than the state of California for the purpose of irrigating lands within such district, which are required to be and are investigated and approved by a commission now or hereafter authorized by a law of said state to conduct such investigation and give such approval; provided, that the entire indebtedness of such district, including the bonds under consideration, and all prior liens, within the meaning of section fiftyseven a of this act, do not exceed fifty per centum of the aggregate market value of the lands within said district, and of the irrigation system owned or to be acquired by said district with the proceeds of said bonds; (c) District bonds. Bonds. of any district organized under the laws of the state of California not otherwise provided for in this section; (d) Railroad bonds. (1) Bonds of any railroad corporation, as the same is defined in the "public utilities act," incorporated under the laws of any state in the United States and operating exclusively in the United States; provided, that said corporation shall have had net earnings for either its fiscal year or twelve consecutive months in the fourteen months next preceding application for certification of said bonds under the provisions of section sixty-one a of this act, amounting to at least one and one-half times the interest on all bonded indebtedness outstanding at the time of said certification, and on all additional bonds then proposed to be issued; or, (2) Bonds of any railroad corporation, the payment of which is guaranteed, both as to principal and interest, by a railroad corporation whose bonds are a legal investment for savings banks in this state. (e) Other public utility bonds. (1) Bonds of any other public utility corporation, as the same is defined in the "public utilites act," incorporated under the laws of any state in the United States and operating exclusively in the United States; provided, that said corporation shall have had net earnings for either its fiscal year or twelve consecutive months in the fourteen months next preceding application for certification of said bonds under the provisions of section sixty-one a of this act, amounting to at least one and one-half times the interest on all bonded indebtedness outstanding at the time of said certification, and on all additional bonds then proposed to be issued; or, (2) Bonds of any similar public utility corporation, the payment of which is guaranteed, both as to principal and interest, by a public utility corporation other than a railroad corporation, whose bonds are a legal investment for savings banks in this state. Determining income. In determining the income of any railroad or other public utility corporation mentioned herein, there shall be included the income of any corporation or corporations out of which it shall have been formed through consolidation or merger, and of any corporation the entire business and income-producing property of which the corporation issuing such bonds has wholly acquired. Security for utility bonds. All bonds issued by a railroad or other public utility corporation must be secured by a mortgage or deed of trust which at the time of said certification is: either I. A closed first mortgage or deed of trust; or, II. A first mortgage or deed of trust containing provisions restricting the issuance of further bonds until such time as the income of said corporation shall have been at least sufficient, during the twelve months next preceding the issuance of any additional bonds, to meet the earning requirements heretofore specified in either paragraph (d) or (e) of subdivision 6 of this section applicable to such corporation after including the additional bonds then proposed to be issued; or, III. A refunding mortgage or deed of trust providing for the retirement of all prior lien mortgage debts of said corporation and restricting the issuance of further bonds until such time as the income of said corporation shall have been at least sufficient, during the twelve months next preceding the issuance of any additional bonds, to meet the earning requirements of such corporation after including the additional bonds then proposed to be issued; or, IV. An underlying or divisional closed mortgage or deed of trust of property which forms a part of the operating system of the corporation then owning said property. In the case of bonds secured by an underlying or divisional closed mortgage or deed of trust, the net income required by this section shall be based exclusively upon the income, maintenance charges, operating expenses, taxes and mortgage indebtedness of or against the property covered by such underlying or divisional closed mortgage or deed of trust or, if such income, maintenance charges or operating expenses cannot be definitely ascertained, on the proper proportionate share of such property in the general income, maintenance charges, operating expenses and taxes of the corporation then owning such property and on the mortgage indebtedness of or against the property covered by such underlying or divisional closed mortgage or deed of trust. (f) Bonds secured by lien on real estate. Notes or bonds secured by first mortgage or deed of trust or other first lien upon real estate, improved or unimproved; provided, that the entire note or bond issue shall not exceed sixty per centum of the market value of such real estate, or such real estate with improvements, taken as security; and provided, further, in case the said note or bond issue is created for a building loan on real estate, that at no time shall the entire outstanding note or bond issue exceed sixty per centum of the market value of the real estate and the actual cost of the improvements thereon taken as security; and provided, also, in case said real estate is located outside of this state, that the provisions of this paragraph shall be subject to the limitations and modifications contained in section fifty-seven a of this act; and provided, also, that no such notes or bonds shall be disqualified as investments for savings banks for the reason that the payment thereof is guaranteed by a policy of mortgage insurance. |