11. to apply to S. J. C. for injunction, upon insolvent banks. to report violation of laws, &c., to sccretary. Attorney-general to prosecute. banks not to discount note of. compensation. BANKS ORGANIZED UNDER CHARTERS. 12. Banks subject to provisions of this chap 13. 14. 15. ter. name of, privileges, and liabilities. may receive deposits, &c., and divide profits. 16. not to go into operation till one-half of capital is paid in, &c. 17. Stock not to be sold until, &c. 18. No loan to stockholder, until, &c. 19. Specie to be kept in bank. What to be deemed such specie. 20. Increased capital, how paid in, &c. 21. No person to own more than half the stock. 22. State may take stock in banks. 23. Limit of loans on its own stock. 24. Banks not to hold their own stock, except, &c. Penalty. 23. Limit of debts due to and from banks. 28. Preceding section, how construed. 27. Liability of directors, when debts exceed, &e. SECTION 43. Directors to be chosen annually by stockholders. Time when chosen. 44. 45. 46. legislature may appoint. may be removed. quorum of. 47. to record notes, &c., offered for discount, and proceedings, &c. Penalty. 48. Special meetings. 49. President. 50. Cashier, &c. Cashier and Loans to Officers. 51. Cashier to give bond. 52. 53. when to call special meetings. not to be director, &c. Penalty. 54. Amount of liability of officers on notes, &c., limited. Bills and Notes. 55. Banks to pay out no bills but their own. 56. Amount of bills to be issued. Loans, where made. 57. Bills, how issued, and when corporation liable to redeem. 58. Banks to pay altered bank-notes. 59. Penalty for delay in payment of notes. 60. Denominations of bank-notes that may be issued. Penalty. 61. Banks may stamp, &c., counterfeit and worthless bills, &c. 62. Liability of banks, &c., for not stamping, &c. 63. Banks not to issue notes, &c., payable on a day certain, or with interest, except, &e. What deposits may bear interest. 64. Bills to be first redeemed. 65. Banks may replevy bills unlawfully detained. 66. Proceedings in such case. Loans and Discounts. 67. Notes not to be issued, to be kept from circulation. 68. Loans, &c., payable on demand, &c. Penalty. 69. Banks not to take more than six per cent interest, and exchange. Penalty. 70. All bills, &c., redeemable, in specie on demand, at banking-house. Penalty. 71. Preceding section not to extend to certain checks and drafts. 72. Banks may draw for balances. Taking Land, fc., on Execution. 73. Real estate of banks may be sold on execution. 74. Officer may adjourn sale. 75. Lands mortgaged to banks may be seized on execution, &c. 76. Cashier or clerk to furnish copies of notes, &c., to officer levying, &c. 77. No transfer of such note or mortgage after notice, &c., to be valid, except; &c. Liability of Stockholders. 78. In case of deficiency, &c., stockholders liable. 79. Liability of stockholders for redemption of bills. 41. 4.2. to be citizens and residents of this state. where to reside, &c. Exception. 80. at expiration of charter. 81. Stockholders may compel contribution. Bank commis sioners estab 82. Corporations owning bank-stock, to be un-114. Shall carry on business only at banking. der same liabilities, &c., as individuals. Loans to Commonwealth. 83. Banks to loan to commonwealth. house. Forfeiture of privilege. 115. Auditor to obtain engraved bank-notes, &c. When delivered, to be countersigned, numbered, and registered. 84. When treasurer borrows, to give notice to 116. 85. Treasurer to apportion amount of loans re- to destroy bank notes, returned. 117. Public stock to be transferred to auditor. Exempt from taxation. 118. Stocks may be exchanged or surrendered. 86. Forfeiture, if banks refuse to loan to treas- 119. Securities to be stamped. 87. Treasurer to institute suit for such refusal. 121. Proceedings when payment of bills refused. 122. Penalty on auditor countersigning too many notes. Taxes. 88. Statement of capital to be furnished treas- 123. Plates, dies, &c., to be kept by auditor. Ex urer. 89. Bank tax. 90. Remedy when bank neglects to pay tax. Weights to be sealed. pense of, by whom paid. 124. What bills banks may pay out. 125. Banks to receive interest, &c., on public stock pledged. 126. Bank to return stocks deposited. 91. Weights of banks to be proved every five | 127. Secretary to prepare separate abstracts. years. 92. No tender of gold valid, unless, &c. Weekly and Monthly Returns. 93. Weekly returns of banks in Boston. 94. Monthly returns of banks out of Boston, and in South Boston. 95. Penalties for neglect under preceding section. Time of annual meeting. 128. Bank commissioners to examine stocks, &c. 129. When stock may be redeemed and returned to bank. 130. Bank may thereafter be discharged upon six years' notice. 131. Injunction may be had in certain cases. 132. When in hands of receivers, auditor to transfer stocks, &c. 96. Secretary to publish abstract of returns. 133. Preceding sections may be altered, and cor Bills to be approved. 97. Blanks to be furnished. Annual Returns. porations dissolved, &c. 134. Banks heretofore organized. SAVINGS BANKS. 98. Cashiers to make returns annually to secre- 135. Savings banks to be governed by following tary. Form of return; how authenticated. 102. Legislature may examine any bank by committee; and declare its charter forfeited, in case, &c. 103. Penalty on officers of banks refusing to exhibit books, &c. 104. One-eighth of the stockholders in number or value, may choose a committee to make an investigation, &c. Annulling and Expiration of Charters. 105. Stockholders may annul charter. Not to exempt from liability. 106. Banks exempt from further tax after commissioners certify, &c. 107. S. J. C. may limit time of liability of banks surrendering charters. 108. When charter of bank expires, directors to deliver plates and dies to court of record. Penalty. New Privileges. 109. New privileges extended to all banks. BANKS ORGANIZED UNDER GENERAL LAWS. 110. Ten or more persons may be a corporation for banking purposes. 111. Amount of capital stock, how paid in. 112. Certificate to be made and recorded. 113. May increase capital. to be sworn. Tenure of office. Treasurer to give bond. choice and appointment of officers. 139. Special meetings, how called. 140. Members, how elected, and how they may withdraw. 141. Deposits may be received not exceeding, BANK COMMISSIONERS. SECTION 1. There shall be a board of bank commissioners consisting of three persons appointed and commissioned by the governor with of office. 1851, 127, § 1. advice and consent of the council, and subject to removal in like man- lished; tenure ner. Before the first day of June in each year one member of the board shall be appointed for the term of three years, who shall hold his office until his successor is appointed and qualified. Upon the occurrence of a vacancy before the expiration of a term an appointment shall be made for the remainder of the term. The commissioners now in office shall hold their respective offices according to the tenor of their respective commissions, unless removed as aforesaid. SECT. 2. Before entering on the duties of their office the commis- Commissioners sioners shall severally be sworn. They may appoint a clerk of their shall be sworn. May appoint board, prescribe his duties, and fix his compensation, when in their opinion the public good demands such appointment. SECT. 3. Said commissioners, or two of them, shall visit every bank in [the] state within one year after it goes into operation, and every bank obtaining leave to increase its capital stock within one year after the additional stock is paid in; and shall visit every bank, savings bank, and institution for savings incorporated by authority of this state, once in every two years, and as much oftener as they deem expedient; visiting as nearly as they are able one-half of all such institutions each year. At such visits they shall have free access to the vaults, books, and papers, and shall thoroughly inspect and examine all the affairs of each of said corporations, and make such inquiries as may be necessary to ascertain its condition, ability to fulfil all its engagements, and whether it has complied with the provisions of law. They shall preserve in a permanent form a full record of their proceedings, including a statement of the condition of each bank. SECT. 4. When the charter of a bank has been annulled by an act of the legislature or by the surrender of the stockholders, the commissioners shall, in the manner and with the powers and duties set forth in the preceding section, visit such bank once at least in every twelve months, so long as it continues a body corporate. SECT. 5. The commissioners or either of them may summon and examine all directors, officers, or agents, of any corporation mentioned in section three, and such other witnesses as they think proper, in relation to the affairs, transactions, and condition, of such corporation, and for that purpose may administer oaths; and whoever refuses without justifiable cause to appear and testify when thereto so required, or obstructs a commissioner in the discharge of his duty, shall be punished by fine not exceeding one thousand dollars, or imprisonment for a term not exceeding one year. SECT. 6. If any five or more persons who are officers, stockholders, or creditors, of any bank or institution for savings, make and sign a certificate, under oath, setting forth their interest and the reasons for making such examination, directed to the commissioners, requesting them to examine such bank or institution for savings, the commissioners shall proceed forthwith and make a full investigation of the affairs of such corporation in the manner before provided. clerk. 1851, 127, §§ 5, 7. to visit banks, savings institutwo years. duties. tions, &c., once in powers and To make record. 1851, 127, § 2. to visit banks whose charters nulled. 183, 14, 12, 3. have been an 1839, 27, § 1. 1843, 93, § 1. may summon and examine un- der oath all di shall examine any bank, upon or more officers. 1851, 127, § 4. request of five to apply to S. ..for Injunc. solvent banks. Met. 581. tion upon in 1851, 127, § 5. 3 9 Met. 194. SECT. 7. If, upon examination of any such corporation, a majority of the commissioners are of opinion that the same is insolvent, or that its condition is such as to render its further progress hazardous to the public or those having funds in its custody, they shall apply, or if upon such examination they are of opinion that such corporation has exceeded its 7 Met. 340. powers, or failed to comply with any of the rules, restrictions, or condi- 11 Met. 129. tions, provided by law, they may apply to one of the justices of the 1 Gray, 382 supreme judicial court to issue an injunction to restrain such corporation in whole or in part from further proceeding with its business until a hearing can be had. Such justice shall forthwith issue process for such purpose, and, after a full hearing of the corporation, may dissolve or modify the injunction or make the same perpetual, and make such orders Commissioners report. 1851, 127, § 6. 1837, 40. 1858, 46. and decrees, to suspend, restrain, or prohibit, the further prosecution of the business of the corporation, as may be needful in the premises according to the course of proceedings in equity; and he may appoint one or more receivers or trustees to take possession of the property and effects of the corporation, subject to such rules and orders as may from time to time be prescribed by the supreme judicial court or any justice thereaf in vacation. SECT. 8. The commissioners shall annually, on or before the fifteenth to make annual day of October, make a report to the secretary of the commonwealth of the general conduct and conditions of the corporations visited by them, making such suggestions as they deem expedient. Such report shall be printed and laid before the legislature at the next session thereof. SECT. 9. If in the opinion of the commissioners any such corporation or its directors or cashier shall be found to have violated any law in relation to banks and banking, they shall forthwith report the same to the secretary with such remarks as they deem expedient; the secretary shall notify the attorney-general thereof, who shall forthwith institute a prosecution for such violation, in behalf of the state. to report vio lation of laws, &c., to secretary. Attorney-gen eral to prosecute. 1851, 127, §§ 6,10. banks not to discount note of. 1851, 127, § 8. compensation. 1859, 148. See Ch. 15, §§ 36, 48. Banks subject this chapter. SECT. 10. No bank shall discount a note or bill of exchange to which a bank commissioner is a party either as principal, surety, indorser, or otherwise. SECT. 11. Each bank commissioner shall receive a salary of two thousand dollars a year, and his travelling expenses while in the performance of the duties of his office. BANKS ORGANIZED UNDER CHARTERS. General Provisions. SECT. 12. Every bank incorporated by a charter under the authority to provisions of of this state shall be subject to the liabilities and governed by the rules and provisions contained in this chapter, except so far as they are not applicable to such corporations. R. S. 36, § 1. name of, privbilities. R. S. 36, § 2. SECT. 13. Each bank shall be known by the corporate name of The ileges, and lia- President, Directors, and Company, of the Bank, (this blank to be filled with the name of the bank,) and shall, except when special provision is otherwise made, be entitled to the powers and privileges and subject to the liabilities specified in chapter sixty-eight, 5 Mass. 97, 99. where to be kept. R. S. 36, § 34. may receive deposits, &c., and divide profits. R. S. 36, § 3. 10 Mass. 284. not to go into operation till one-half of capi R. S. 36, § 4. SECT. 14. Every bank shall be kept in the city or town in which it is established, and in such part thereof as is prescribed by its charter. SECT. 15. Every bank may receive deposits, and may loan and nego tiate its moneys and effects by discounting on banking principles upon such security as the stockholders shall deem expedient; and dividends of the profits may be made by the directors every six months. SECT. 16. No bank shall go into operation until one-half of its capital stock has been paid in gold and silver money, and is in its vaults, and tal is paid in, &c. until the money has been examined by three commissioners appointed by the governor. Such commissioners shall, at the expense of the bank, examine and count the money actually in the vaults, and ascertain by the oaths of a majority of the directors that such money has been paid in by the stockholders towards payment of their respective shares, and not for any other purpose, and that it is intended that the same shall remain therein as part of said capital; and shall return a certificate thereof to the governor. Stock not to be sold until, &c. R. S. 36, § 7. Loans to stockholders. R. S. 36, § 5. Specie to be kept in bank. SECT. 17. No part of the capital stock of a bank shall be sold or transferred until the whole amount thereof is paid in. SECT. 18. No loan shall be made to a stockholder until the full amount of his shares is paid into the bank. SECT. 19. Every bank shall keep in the bank an amount of specie equal to fifteen per cent. of its liability for circulation and deposits; and specie. 1858, 69, § 1. when by the returns required by sections ninety-three and ninety-four What to be it appears that the weekly or monthly average of specie required thereby deemed such to be returned by a bank is less than that amount, such bank shall make 1856, 95, § 1. no new loans until its specie is restored to such amount. Specie specially 1858, 165. deposited by a bank in Boston in the bank of deposit of the Boston 1859, 218. Clearing House, and balances payable on demand due from other banks to banks out of Boston or in South Boston which may be applied to the redemption of their bills, shall be deemed specie in the bank for the purposes of this section. &c. SECT. 20. When authority is granted to a bank to increase its capi- Increased capital, such increased capital may be paid in such instalments, not exceed- tal, how paid in, ing four, as the directors determine; and each instalment shall be re- 1836, 263. garded as a part of the capital of the bank as soon as it is paid in and a certificate thereof forwarded to the secretary of the commonwealth according to the provisions of the act authorizing the increase. SECT. 21. No person shall directly or indirectly hold or own more No person to than one-half of the amount of the capital stock of a bank, exclusive of half the stock. stock which he holds as collateral security. SECT. 22. In addition to the capital stock to which a bank is entitled, the state may subscribe thereto to an amount not exceeding fifty per cent. of its authorized capital, when provision is made therefor by law; and the state, from the time of making any payment towards such capital stock, shall be entitled to its proportionate share of the profits and dividends. SECT. 23. No bank shall have owing to it at one time, on loans made on a pledge of its own stock, a greater amount than one-half of its capital actually paid in. SECT. 24. A bank which purchases or holds its own stock except as security for debts, or neglects to sell all stock so received as security within six months after it has become the property of the bank, shall for each offence forfeit five hundred dollars. SECT. 25. The debts of a bank shall not at any time exceed twice the amount of its capital stock actually paid in, exclusive of sums due on account of deposits not bearing interest; nor shall there at any time. be due to a bank more than double the amount of its capital stock actually paid in. own more than R. S. 36, § 16. State may take R. S. 36, § 42. stock in banks. Limit of loans stock. on its own R. S. 36, § 6. Banks not to stock, except. 1838, 196, § 7. hold their own 1851, 339, § 1. Limit of debts. R. S. 36, § 9. strued. SECT. 26. Debts due from one bank to another, including bills of the Preceding secbank so indebted and loans to the state not exceeding five per cent. of tion, how conthe capital stock of the bank, shall not be deemed debts due within the R. S. 36, § 10. meaning of the preceding section. 1851, 7. R. S. 36, § 11. SECT. 27. If a bank shall become indebted beyond the amount al- Liability of dilowed by the two preceding sections, the directors under whose admin- rectors, when istration it shall happen shall be liable for the excess in their private &c. capacities; and an action of contract may in such case be brought 1852, 312. against them or any of them, their or any of their heirs, executors, or administrators, by any creditor of the bank, or such creditor may have a remedy by a suit in equity. SECT. 28. Directors dissenting or absent when such excess of debts is authorized or contracted, may exonerate themselves from liability, by forthwith giving notice of the fact and of their absence or dissent to either of the bank commissioners. SECT. 29. The provisions of the two preceding sections shall not be construed to exempt any bank, or the lands, goods, or chattels, of the same, from liability for such excess. SECT. 30. No bank shall use or employ any of its moneys, goods, chattels, or effects, in trade or commerce; but any bank may sell all kinds of property held by it in pledge; and if the proceeds of such sale are more than sufficient to repay the sum loaned on such pledge, together with interest and expenses, the surplus shall upon request be Absent, &c., di- rectors, how ex 1838, 196, § 5. Corporations to remain liable. Banks shall not trade,& 7 R. S. 36, § 14. Mass. 433. |