knowledge, and submit to him, all books, records, written instruments and documents in their possession or under their control, touching the business of such bank; the State Bank Commissioner shall have the power to administer oaths and affirmations and to examine on oath or affirmation, and to summon, and by attachment compel the attendance of any person or persons in this State to testify under oath before him, in relation to the affairs of any bank. [L. '13, p. 121, § 21.]

286. False statement or entries—Omissions.

SEC. 22. No officer, director, owner or employe of any bank shall subscribe to or make any false statement or report respecting the affairs of the bank, nor make any false entries nor omit to make any statement or entry which should be made or which should appear in the books or in any statement of such bank, with intent to deceive or injure any person.

Any person who shall be instrumental in the making or procuring to be made any false statement or report respecting the affairs of any bank, shall be deemed the principal offender. [L. '13, p. 122, § 22.]

SEC. 23. No officer, director, owner or employe of any bank shall, directly or by indirection, embezzle, abstract or misapply, or cause to be embezzled, abstracted or misapplied, any of the funds or securities or other property of or under the control of a bank, with intent to deceive, injure, cheat, wrong or defraud any person. [L. '13, p. 122, § 23.]

288. Capital and surplus.

SEC. 24. After January 1, 1914, the combined capital and surplus of every bank shall be equal to at least ten per cent of its average daily deposits during the last preceding calendar year. [L. '13, p. 122, § 24.]

SEC. 25. Except as in this Section provided, every bank, except savings banks, shall at all times keep a reserve equal to twenty per cent of its deposits. Every savings bank shall at all times keep a reserve equal to fifteen per cent of its savings deposits and. in addition thereto shall keep a reserve equal to twenty per cent of its other deposits. All banks shall hold in cash not less than twenty per cent of their required reserve. That portion of the reserve not hereby required to be held in cash may be kept on deposit in national banks located in cities designated by federal law as reserve cities, or on deposit in banks or trust companies designated by the State Bank Commissioner as reserve banks. Every reserve bank in this State shall at all times keep a reserve equal to twenty-five per cent of its deposits. The State Bank Commissioner

shall from time to time designate as reserve banks such banks and trust companies in other States as he may deem necessary. [L. '13, p. 122, § 25.]

290. Impaired capital or reserve.

SEC. 26. Whenever the capital or reserve of any bank shall be impaired, it shall make no new loans or discounts except upon sight bills of exchange drawn against actually existing values. When the capital or reserve of any bank shall be impaired, it shall be fully restored within thirty days from such time as the State Bank Commissioner shall notify said bank of such impairment. [L. '13, p. 123, § 26.]

291. Assessment when capital impaired.

SEC. 27. When the capital of any incorporated bank is impaired, the Board of Directors of such bank shall make a pro rata assessment upon the stock of said bank to make good such deficiency. If any stockholder fails or neglects to pay the amount of such assessment against his stock on or before thirty days after notice thereof, an action may be commenced by said bank to recover the same. [L. '13, p. 123, § 27.]

292. Limitation on real estate holdings.

SEC. 28. Banks may purchase and hold such real property as may be necessary for their immediate accommodation in the transaction of their business, but not otherwise unless necessarily acquired in the protection or satisfaction of previously existing loans made in good faith. Any real property so acquired shall be sold by the bank within five years, and sooner if it can be done without impairing the bank's investment in such property. No bank shall, directly or indirectly, engage in trade or commerce. [L. '13, p. 123, § 28.]

292-A. Loans on own stock prohibited-Not own stock of corporations.

SEC. 28a. No bank shall make any loan or discount upon the security of its own capital stock. No bank shall loan to or discount any paper of its stockholders upon the security of the capital stock of any other bank. No bank shall loan to or discount any paper of any person or persons upon the security of the capital stock of any other bank in excess. in the aggregate, of twenty-five per cent of the total shares of such bank. No bank shall purchase its own stock, nor the stock of any other corporation, except such as it may necessarily acquire in the protection or satisfaction of previously existing loans made in good faith. Any stock so acquired shall be sold by the bank within three years, and sooner if it can be done without impairing the bank's investment in the same. [L. '13, p. 123, § 29.]

292-B. Limitations on real estate loans.

SEC. 28b. No bank, except savings banks, shall make, or purchase loans secured by mortgage or trust deed on real estate in excess of twenty-five per cent of its total interest-bearing securities; nor, except in the case of savings banks, shall any such loan be for a longer period than three years. Banks may make, purchase and hold loans for not to exceed five years upon first trust deeds or first mortgages on real estate, worth at least double the amount of the loan, to the extent of fifty per cent of their savings deposits. No bank shall make or purchase loans or real estate unless such loans are secured by first trust deeds or first mortgages, except as additional security to loans previously made by such bank. [L. '13, p. 123, § 30.]

292-C. Investment of savings deposits.

SEC. 28c. Except as permitted by Section 30 hereof, savings deposits shall not be loaned or invested except upon or in the following evidences of indebtedness, towit: Securities of the United States, of the several States of the United States, Counties, Cities, Towns, Irrigation Districts, School Districts, first class commercial paper, negotiable paper secured by collateral having an actual cash market value in excess of the loan so secured and first mortgage bonds of steam or street railway, water, light, gas and industrial corporations which have earned at least four per cent net per annum on their capital stock during the five years immediately preceding the date of such loan or loans and have not defaulted in the payment of the principal or interest of any debt during such period. [L. '13, p. 124, § 31.]

(Section 30 herein referred to is § 28b, supra.)

292-D. Savings deposits-Regulations posted.

SEC. 28d. Savings deposits shall be repaid to the depositors under such regulations as the board of directors shall, from time to time, prescribe. Such regulations shall be printed in depositors' pass books and also conspicuously exposed in some place accessible and visible in the business office of the bank; and no alteration which may at any time be made in the rules and regulations shall in any manner affect the rights of a depositor within the contract period in respect to deposits made previous to such alteration. [L. '13, p. 124, § 32.]

292-E. Loans to officers, employes and certain others forbidden.

SEC. 28e. No bank shall loan to any officer or employe thereof. No officer or employe of any bank shall become endorser for any person, firm or corporation borrowing money therefrom without the approval of the board of directors entered of record in the minutes of the board. No bank shall loan to the State Bank Commissioner, or any of his deputies, nor shall said State Bank Com

missioner or any of his deputies become endorser for any person, firm or corporation borrowing money therefrom. No unincorporated bank shall loan to any person or co-partner owning an interest therein. No individual or co-partner owning an interest in an unincorporated bank shall become endorser for any person, firm or corporation borrowing money therefrom, nor shall any note or obligation of such individual or co-partner be considered an asset of such bank.

Loans to directors in excess of ten per cent of the capital stock and surplus of the bank shall be made only with the approval of a majority of the board of directors, exclusive of the borrower, entered of record in the minutes of the board. No bank shall become the creditor of its stockholders collectively in an amount exceeding forty per cent of its capital. [L. '13, p. 124, § 33.]

292-F. Loans limited to 20 per cent.

SEC. 28f. No bank shall become the creditor of any person, firm or corporation, including in the liabilities of the firm the liabilities of the members thereof, and including in the liabilities of any person the liabilities of any firm of which such person is a member, in an amount exceeding twenty per cent of its capital stock and surplus, but the discount of bills of exchange drawn against actually existing values, loans upon produce in transit and upon warehouse and elevator receipts as collateral security, and negotiable paper secured by collateral having an actual market value in excess of the paper secured, shall not be considered as money borrowed. And in ascertaining the amount due to the bank from its stockholders, such paper shall not be considered as money borrowed. No bank shall invest more than twenty per cent of its capital and surplus in the notes, bonds or other securities of any person, firm or corporation. Provided, however, that this section shall not operate to prevent any bank from purchasing for immediate resale all or any part of any issue of securities of the United States, of the several States of the United States, counties, cities, towns, irrigation districts and school districts, and first mortgage bonds of steam or street railways, water, light, gas and industrial corporations which have earned at least four per cent net per annum on their capital stock during the five years immediately preceding the date of such purchase, and have not defaulted in the payment of the principal or interest of any debt during such period. [L. '13, p. 125, § 34.]

292-G. Limitation on banks borrowing or rediscountingGrace.

SEC. 28g. No bank shall borrow money for a period exceeding thirty days, except it be evidenced by its promissory note. No bank shall borrow money or rediscount paper in excess of the amount of its capital stock and surplus, nor without the authority of the board of directors. If any bank shall hypothecate or pledge of its securities or other assets as collateral for money borrowed,

any

and said bank shall be taken possession of by the State Bank Commissioner at any time before such pledge or hypothecation shall be foreclosed, a grace of thirty days after the date when the State Bank Commissioner so takes possession shall be allowed in which such bank or the State Bank Commissioner shall be permitted to redeem such securities or other assets by the payment of the amount due under the terms of the existing contract. [L. 13, p. 126,

$35.]

292-H. Limit of deposit with other banks.

SEC. 28h. No bank shall carry on deposit with any other bank for more than sixty days in any calendar year an amount in excess of twenty per cent of the total of its own deposits. [L. '13, p. 126, § 36.]

292-J. Limit of rate of interest on deposits.

SEC. 28j. No bank shall pay, directly or indirectly, interest on savings or time deposits in excess of four per cent nor on deposits subject to call in excess of three per cent per annum; provided that upon the production of satisfactory evidence to the State Bank Commissioner that competing national banks in the vicinity or locality wherein State banks are operating are paying a higher rate of interest than is provided for in this section, the State Bank Commissioner may authorize such State banks affected to pay such rate as may in his judgment be deemed advisable, which shall in no event exceed the rate of interest paid by such competing national banks. [L. '13, p. 126, § 37.]

292-K. Stock held to secure indebtedness.

SEC. 28k. No sale of the stock of any bank shall be valid as against the bank or any creditor thereof so long as the holder is indebted to the bank, either as principal or surety, on any past due obligations, nor in such case shall any dividend or interest be paid on such shares, but the same shall be retained by the bank and applied to the discharge of such liabilities. [L. '13, p. 126, § 38.]

292-L. Personal liability of shareholders.

SEC. 281. The shareholders of every banking corporation shall be held individually responsible, equally and ratably, and not one for another, for all contracts, debts and engagements of said corporation, to the extent of double the amount of their stock therein, at the par value thereof, in addition to the amount invested in such shares. The term shareholder shall apply not only to such persons as appear on the books of the bank as shareholders, but also to every owner of stock, legal or equitable, although the same may stand on such books in the name of another person, but not to a person who holds the stock as collateral security for the payment of a debt. [L. '13, p. 127, § 39.]