CHAPTER 2 —NATIONAL BANKS
SUBCHAPTER I—ORGANIZATION AND GENERAL PROVISIONS
SUBCHAPTER II—CAPITAL, STOCK, AND STOCKHOLDERS
SUBCHAPTER III—DIRECTORS
SUBCHAPTER IV—REGULATION OF THE BANKING BUSINESS; POWERS AND DUTIES OF NATIONAL BANKS
SUBCHAPTER V—OBTAINING AND ISSUING CIRCULATING NOTES
SUBCHAPTER VI—REDEMPTION AND REPLACEMENT OF CIRCULATING NOTES
SUBCHAPTER VII—PROCEEDINGS ON FAILURE OF BANK TO REDEEM CIRCULATING NOTES
SUBCHAPTER VIII—RESERVE CITIES; LAWFUL RESERVES
SUBCHAPTER IX—FORMATION OF ASSOCIATIONS TO ISSUE GOLD NOTES
SUBCHAPTER X—BANK EXAMINATIONS; REPORTS
SUBCHAPTER XI—MISCELLANEOUS PROVISIONS REGARDING UNITED STATES BONDS IN RELATION TO NATIONAL BANKS
SUBCHAPTER XII—VOLUNTARY DISSOLUTION
SUBCHAPTER XIII—RECEIVERSHIP
SUBCHAPTER XIV—BANK CONSERVATION ACT
SUBCHAPTER XV—CONVERSION OF NATIONAL BANKS INTO STATE BANKS
SUBCHAPTER XVI—CONSOLIDATION AND MERGER
SUBCHAPTER XVII—DISPOSITION OF UNCLAIMED PROPERTY RECOVERED FROM CLOSED NATIONAL BANKS
SUBCHAPTER I—ORGANIZATION AND GENERAL PROVISIONS
§21. Formation of national banking associations; incorporators; articles of association
Associations for carrying on the business of banking under title 62 of the Revised Statutes may be formed by any number of natural persons, not less in any case than five. They shall enter into articles of association, which shall specify in general terms the object for which the association is formed, and may contain any other provisions, not inconsistent with law, which the association may see fit to adopt for the regulation of its business and the conduct of its affairs. These articles shall be signed by the persons uniting to form the association, and a copy of them shall be forwarded to the Comptroller of the Currency, to be filed and preserved in his office.
(R.S. §5133.)
Editorial Notes
References in Text
Title 62 of the Revised Statutes, referred to in text, was in the original "this Title" meaning title LXII of the Revised Statutes, consisting of R.S. §§5133 to 5244, which are classified to this section and
Codification
R.S. §5133 derived from act June 3, 1864, ch. 106, §5,
Statutory Notes and Related Subsidiaries
Short Title of 2014 Amendment
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§21a. Amendment of articles of association
Except as otherwise specifically provided by law, or by the articles of association of the particular national banking association, the articles of association of a national banking association may be amended with respect to any lawful matter, and any action requiring the approval of the stockholders of such association may be had by the approving vote of the holders of a majority of the voting shares of the stock of the association obtained at a meeting of the stockholders called and held pursuant to notice given by mail at least ten days prior to the meeting or pursuant to a waiver of such notice given by all stockholders entitled to receive notice of such meeting. A certified copy of every amendment to the articles of association adopted by the shareholders of a national banking association shall be forwarded to the Comptroller of the Currency, to be filed and preserved in his office.
(
§22. Organization certificate
The persons uniting to form such an association shall, under their hands, make an organization certificate, which shall specifically state:
First. The name assumed by such association; which name shall include the word "national".
Second. The place where its operations of discount and deposit are to be carried on, designating the State, Territory, or District, and the particular county and city, town, or village.
Third. The amount of capital stock and the number of shares into which the same is to be divided.
Fourth. The names and places of residence of the shareholders and the number of shares held by each of them.
Fifth. The fact that the certificate is made to enable such persons to avail themselves of the advantages of title 62 of the Revised Statutes.
(R.S. §5134;
Editorial Notes
References in Text
Title 62 of the Revised Statutes, referred to in par. Fifth, was in the original "this Title" meaning title LXII of the Revised Statutes, consisting of R.S. §§5133 to 5244, which are classified to this section and
Codification
R.S. §5134 derived from act June 3, 1864, ch. 106, §6,
Amendments
1982—Par. First.
1959—Par. First.
§23. Acknowledgment and filing of certificate
The organization certificate shall be acknowledged before a judge of some court of record, or notary public; and shall be, together with the acknowledgment thereof, authenticated by the seal of such court, or notary, transmitted to the Comptroller of the Currency, who shall record and carefully preserve the same in his office.
(R.S. §5135.)
Editorial Notes
Codification
R.S. §5135 derived from act June 3, 1864, ch. 106, §6,
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§24. Corporate powers of associations
Upon duly making and filing articles of association and an organization certificate a national banking association shall become, as from the date of the execution of its organization certificate, a body corporate, and as such, and in the name designated in the organization certificate, it shall have power—
First. To adopt and use a corporate seal.
Second. To have succession from February 25, 1927, or from the date of its organization if organized after February 25, 1927, until such time as it be dissolved by the act of its shareholders owning two-thirds of its stock, or until its franchise becomes forfeited by reason of violation of law, or until terminated by either a general or a special Act of Congress or until its affairs be placed in the hands of a receiver and finally wound up by him.
Third. To make contracts.
Fourth. To sue and be sued, complain and defend, in any court of law and equity, as fully as natural persons.
Fifth. To elect or appoint directors, and by its board of directors to appoint a president, vice president, cashier, and other officers, define their duties, require bonds of them and fix the penalty thereof, dismiss such officers or any of them at pleasure, and appoint others to fill their places.
Sixth. To prescribe, by its board of directors, bylaws not inconsistent with law, regulating the manner in which its stock shall be transferred, its directors elected or appointed, its officers appointed, its property transferred, its general business conducted, and the privileges granted to it by law exercised and enjoyed.
Seventh. To exercise by its board of directors or duly authorized officers or agents, subject to law, all such incidental powers as shall be necessary to carry on the business of banking; by discounting and negotiating promissory notes, drafts, bills of exchange, and other evidences of debt; by receiving deposits; by buying and selling exchange, coin, and bullion; by loaning money on personal security; and by obtaining, issuing, and circulating notes according to the provisions of title 62 of the Revised Statutes. The business of dealing in securities and stock by the association shall be limited to purchasing and selling such securities and stock without recourse, solely upon the order, and for the account of, customers, and in no case for its own account, and the association shall not underwrite any issue of securities or stock; Provided, That the association may purchase for its own account investment securities under such limitations and restrictions as the Comptroller of the Currency may by regulation prescribe. In no event shall the total amount of the investment securities of any one obligor or maker, held by the association for its own account, exceed at any time 10 per centum of its capital stock actually paid in and unimpaired and 10 per centum of its unimpaired surplus fund, except that this limitation shall not require any association to dispose of any securities lawfully held by it on August 23, 1935. As used in this section the term "investment securities" shall mean marketable obligations, evidencing indebtedness of any person, copartnership, association, or corporation in the form of bonds, notes and/or debentures commonly known as investment securities under such further definition of the term "investment securities" as may by regulation be prescribed by the Comptroller of the Currency. Except as hereinafter provided or otherwise permitted by law, nothing herein contained shall authorize the purchase by the association for its own account of any shares of stock of any corporation. The limitations and restrictions herein contained as to dealing in, underwriting and purchasing for its own account, investment securities shall not apply to obligations of the United States, or general obligations of any State or of any political subdivision thereof, or obligations of the Washington Metropolitan Area Transit Authority which are guaranteed by the Secretary of Transportation under section 9 of the National Capital Transportation Act of 1969, or obligations issued under authority of the Federal Farm Loan Act, as amended, or issued by the thirteen banks for cooperatives or any of them or the Federal Home Loan Banks, or obligations which are insured by the Secretary of Housing and Urban Development under title XI of the National Housing Act [
A national banking association may deal in, underwrite, and purchase for such association's own account qualified Canadian government obligations to the same extent that such association may deal in, underwrite, and purchase for such association's own account obligations of the United States or general obligations of any State or of any political subdivision thereof. For purposes of this paragraph—
(1) the term "qualified Canadian government obligations" means any debt obligation which is backed by Canada, any Province of Canada, or any political subdivision of any such Province to a degree which is comparable to the liability of the United States, any State, or any political subdivision thereof for any obligation which is backed by the full faith and credit of the United States, such State, or such political subdivision, and such term includes any debt obligation of any agent of Canada or any such Province or any political subdivision of such Province if—
(A) the obligation of the agent is assumed in such agent's capacity as agent for Canada or such Province or such political subdivision; and
(B) Canada, such Province, or such political subdivision on whose behalf such agent is acting with respect to such obligation is ultimately and unconditionally liable for such obligation; and
(2) the term "Province of Canada" means a Province of Canada and includes the Yukon Territory and the Northwest Territories and their successors.
In addition to the provisions in this paragraph for dealing in, underwriting, or purchasing securities, the limitations and restrictions contained in this paragraph as to dealing in, underwriting, and purchasing investment securities for the national bank's own account shall not apply to obligations (including limited obligation bonds, revenue bonds, and obligations that satisfy the requirements of
Eighth. To contribute to community funds, or to charitable, philanthropic, or benevolent instrumentalities conducive to public welfare, such sums as its board of directors may deem expedient and in the interests of the association, if it is located in a State the laws of which do not expressly prohibit State banking institutions from contributing to such funds or instrumentalities.
Ninth. To issue and sell securities which are guaranteed pursuant to
Tenth. To invest in tangible personal property, including, without limitation, vehicles, manufactured homes, machinery, equipment, or furniture, for lease financing transactions on a net lease basis, but such investment may not exceed 10 percent of the assets of the association.
Eleventh. To make investments directly or indirectly, each of which is designed primarily to promote the public welfare, including the welfare of low- and moderate-income communities or families (such as by providing housing, services, or jobs). An association shall not make any such investment if the investment would expose the association to unlimited liability. The Comptroller of the Currency shall limit an association's investments in any 1 project and an association's aggregate investments under this paragraph. An association's aggregate investments under this paragraph shall not exceed an amount equal to the sum of 5 percent of the association's capital stock actually paid in and unimpaired and 5 percent of the association's unimpaired surplus fund, unless the Comptroller determines by order that the higher amount will pose no significant risk to the affected deposit insurance fund, and the association is adequately capitalized. In no case shall an association's aggregate investments under this paragraph exceed an amount equal to the sum of 15 percent of the association's capital stock actually paid in and unimpaired and 15 percent of the association's unimpaired surplus fund. The foregoing standards and limitations apply to investments under this paragraph made by a national bank directly and by its subsidiaries.
(R.S. §5136; July 1, 1922, ch. 257, §1,
Amendment of Section
For termination of amendment by section 501(c) of
Editorial Notes
References in Text
Title 62 of the Revised Statutes, referred to in par. Seventh, was in the original "this Title" meaning title LXII of the Revised Statutes, consisting of R.S. §§5133 to 5244, which are classified to this section and
Section 9 of the National Capital Transportation Act of 1969, referred to in par. Seventh, is section 9 of
The Federal Farm Loan Act, referred to in par. Seventh, is act July 17, 1916, ch. 245,
The National Housing Act, referred to in par. Seventh, is act June 27, 1934, ch. 847,
Section 110 of the Housing Act of 1949 [
The United States Housing Act of 1937, referred to in par. Seventh, is act Sept. 1, 1937, ch. 896, as revised generally by
The Housing and Urban Development Act of 1968, referred to in par. Seventh, is
Section 4 of the Securities Act of 1933, referred to in par. Seventh, was amended by section 201(b), (c) of
Codification
Amendment by
R.S. §5136 derived from act June 3, 1864, ch. 106, §8,
Amendments
2008—Par. Eleventh.
2006—Par. Eleventh.
1999—Par. Seventh.
1996—Par. Seventh.
Par. Eleventh. Pub. L. 104—208, §2704(d)(7), which directed the amendment of the fifth sentence by substituting "Deposit Insurance Fund" for "affected deposit insurance fund", was repealed by
1994—Par. Seventh.
1993—Par. Seventh.
1992—Par. Eleventh.
1990—Par. Seventh.
1988—Par. Seventh.
1987—Par. Tenth.
1984—Par. Seventh.
1983—Par. Seventh.
1982—Par. Seventh.
1981—Par. Seventh.
1980—Par. Seventh.
1974—Par. Seventh.
1973—Par. Seventh.
1972—Par. Seventh.
1970—Par. Seventh.
1968—Par. Seventh.
Par. Ninth.
1967—Par. Seventh.
1966—Par. Seventh.
1964—Par. Seventh.
1959—Par. Seventh.
1959—Par. Seventh.
1956—Par. Seventh. Act July 26, 1956, removed restriction which prohibited a national bank from investing in obligations of the thirteen banks for cooperatives an amount exceeding 10 percent of its capital stock actually paid in and unimpaired and 10 percent of its unimpaired surplus.
1954—Par. Seventh. Act Aug. 23, 1954, substituted "thirteen banks for cooperatives organized under the Farm Credit Act of 1933, or any of them" for "Central Bank for Cooperatives" in last sentence.
Act Aug. 2, 1954, substituted "or obligations of the Federal National Mortgage Association" for "or obligations of national mortgage associations" in sixth sentence.
1952—Par. Seventh. Act Apr. 9, 1952, enabled national banks and State member banks of the Federal Reserve System to receive compensation in the distribution of debentures issued by the Central Bank for Cooperation.
1949—Par. Seventh. Act July 15, 1949, inserted, in next to last sentence, "or such obligations of any local public agency (as defined in section 110(h) of the Housing Act of 1949) as are secured by an agreement between the local public agency and the Housing and Home Finance Administrator in which the local public agency agrees to borrow from said Administrator, and said Administrator agrees to lend to said local public agency, prior to the maturity of such obligations (which obligations shall have a maturity of not more than eighteen months), monies in an amount which (together with any other monies irrevocably committed to the payment of interest on such obligations) will suffice to pay the principal of such obligations with interest to maturity thereon, which monies under the terms of said agreement are required to be used for the purpose of paying the principal of and the interest on such obligations at their maturity, or such obligations of a public housing agency (as defined in the United States Housing Act of 1937, as amended) as are secured either (1) by an agreement between the public housing agency and the Public Housing Administration in which the public housing agency agrees to borrow from the Public Housing Administration, and the Public Housing Administration agrees to lend to the public housing agency, prior to the maturity of such obligations (which obligations shall have a maturity of not more than eighteen months), monies in an amount which (together with any other monies irrevocably committed to the payment of interest on such obligations) will suffice to pay the principal of such obligations with interest to maturity thereon, which monies under the terms of said agreement are required to be used for the purpose of paying the principal of and the interest on such obligations at their maturity, or (2) by a pledge of annual contributions under an annual contributions contract between such public housing agency and the Public Housing Administration if such contract shall contain the covenant by the Public Housing Administration which is authorized by subsection (b) of section 22 of the United States Housing Act of 1937, as amended, and if the maximum sum and the maximum period specified in such contract pursuant to said subsection 22(b) shall not be less than the annual amount and the period for payment, which are requisite to provide for the payment when due of all installments of principal and interest on such obligations".
Act June 29, 1949, inserted last sentence to permit national banks and State member banks of the Federal Reserve System to deal in and underwrite obligations issued by the International Bank subject to certain limitations.
1940—Par. Eighth. Act June 11, 1940, added par. Eighth.
1938—Par. Seventh. Act Feb. 3, 1938, inserted "or obligations of national mortgage associations" in last sentence.
1935—Par. Seventh. Act Aug. 23, 1935, amended second, fourth, and last sentences.
1933—Act June 16, 1933, among other changes, struck out closing paragraph prohibiting transaction of any business by association prior to authorization by Comptroller, except that necessarily preliminary to organization.
1927—Act Feb. 25, 1927, struck out definite period of succession in par. Second, and inserted provisos in par. Seventh.
Statutory Notes and Related Subsidiaries
Effective Date of 2006 Amendment
Amendment by
Effective Date of 1999 Amendment
Effective Date of 1996 Amendment
Amendment by section 2704(d)(7) of
Effective Date of 1994 Amendment
Effective and Termination Dates of 1988 Amendment
Amendment by
Effective Date of 1981 Amendment
Amendment by
Effective Date of 1973 Amendments
Amendment by
Amendment by
Effective Date of 1970 Amendment
For effective date of amendment by
Effective Date of 1968 Amendment
For effective date of amendment by title VIII of
Effective Date of 1956 Amendment
Amendment by act July 26, 1956, effective Jan. 1, 1957, see act July 26, 1956, ch. 741, title II, §202(a),
Effective Date of 1933 Amendment
Act June 16, 1933, ch. 89, §16,
Regulations
Abolition of Home Owners' Loan Corporation
For dissolution and abolishment of Home Owners' Loan Corporation, by act June 30, 1953, ch. 170, §21,
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
1 So in original. Probably should be followed by a comma.
3 See References in Text note below.
4 So in original. The period probably should be preceded by an additional closing parenthesis.
§24a. Financial subsidiaries of national banks
(a) Authorization to conduct in subsidiaries certain activities that are financial in nature
(1) In general
Subject to paragraph (2), a national bank may control a financial subsidiary, or hold an interest in a financial subsidiary.
(2) Conditions and requirements
A national bank may control a financial subsidiary, or hold an interest in a financial subsidiary, only if—
(A) the financial subsidiary engages only in—
(i) activities that are financial in nature or incidental to a financial activity pursuant to subsection (b); and
(ii) activities that are permitted for national banks to engage in directly (subject to the same terms and conditions that govern the conduct of the activities by a national bank);
(B) the activities engaged in by the financial subsidiary as a principal do not include—
(i) insuring, guaranteeing, or indemnifying against loss, harm, damage, illness, disability, or death (except to the extent permitted under section 302 or 303(c) of the Gramm-Leach-Bliley Act [
(ii) real estate development or real estate investment activities, unless otherwise expressly authorized by law; or
(iii) any activity permitted in subparagraph (H) or (I) of
(C) the national bank and each depository institution affiliate of the national bank are well capitalized and well managed;
(D) the aggregate consolidated total assets of all financial subsidiaries of the national bank do not exceed the lesser of—
(i) 45 percent of the consolidated total assets of the parent bank; or
(ii) $50,000,000,000;
(E) except as provided in paragraph (4), the national bank meets standards of credit-worthiness established by the Comptroller of the Currency or other requirement set forth in paragraph (3); and
(F) the national bank has received the approval of the Comptroller of the Currency for the financial subsidiary to engage in such activities, which approval shall be based solely upon the factors set forth in this section.
(3) Requirement
(A) In general
A national bank meets the requirements of this paragraph if the bank is one of the 100 largest insured banks and has not fewer than 1 issue of outstanding debt that meets standards of credit-worthiness or other criteria as the Secretary of the Treasury and the Board of Governors of the Federal Reserve System may jointly establish.
(B) Consolidated total assets
For purposes of this paragraph, the size of an insured bank shall be determined on the basis of the consolidated total assets of the bank as of the end of each calendar year.
(4) Financial agency subsidiary
The requirement in paragraph (2)(E) shall not apply with respect to the ownership or control of a financial subsidiary that engages in activities described in subsection (b)(1) solely as agent and not directly or indirectly as principal.
(5) Regulations required
Before the end of the 270-day period beginning on November 12, 1999, the Comptroller of the Currency shall, by regulation, prescribe procedures to implement this section.
(6) Indexed asset limit
The dollar amount contained in paragraph (2)(D) shall be adjusted according to an indexing mechanism jointly established by regulation by the Secretary of the Treasury and the Board of Governors of the Federal Reserve System.
(7) Coordination with section 1843(l)(2) of this title
(b) Activities that are financial in nature
(1) Financial activities
(A) In general
An activity shall be financial in nature or incidental to such financial activity only if—
(i) such activity has been defined to be financial in nature or incidental to a financial activity for bank holding companies pursuant to
(ii) the Secretary of the Treasury determines the activity is financial in nature or incidental to a financial activity in accordance with subparagraph (B).
(B) Coordination between the Board and the Secretary of the Treasury
(i) Proposals raised before the Secretary of the Treasury
(I) Consultation
The Secretary of the Treasury shall notify the Board of, and consult with the Board concerning, any request, proposal, or application under this section for a determination of whether an activity is financial in nature or incidental to a financial activity.
(II) Board view
The Secretary of the Treasury shall not determine that any activity is financial in nature or incidental to a financial activity under this section if the Board notifies the Secretary in writing, not later than 30 days after the date of receipt of the notice described in subclause (I) (or such longer period as the Secretary determines to be appropriate under the circumstances) that the Board believes that the activity is not financial in nature or incidental to a financial activity or is not otherwise permissible under this section.
(ii) Proposals raised by the Board
(I) Board recommendation
The Board may, at any time, recommend in writing that the Secretary of the Treasury find an activity to be financial in nature or incidental to a financial activity for purposes of this section.
(II) Time period for secretarial action
Not later than 30 days after the date of receipt of a written recommendation from the Board under subclause (I) (or such longer period as the Secretary of the Treasury and the Board determine to be appropriate under the circumstances), the Secretary shall determine whether to initiate a public rulemaking proposing that the subject recommended activity be found to be financial in nature or incidental to a financial activity under this section, and shall notify the Board in writing of the determination of the Secretary and, in the event that the Secretary determines not to seek public comment on the proposal, the reasons for that determination.
(2) Factors to be considered
In determining whether an activity is financial in nature or incidental to a financial activity, the Secretary shall take into account—
(A) the purposes of this Act 1 and the Gramm-Leach-Bliley Act;
(B) changes or reasonably expected changes in the marketplace in which banks compete;
(C) changes or reasonably expected changes in the technology for delivering financial services; and
(D) whether such activity is necessary or appropriate to allow a bank and the subsidiaries of a bank to—
(i) compete effectively with any company seeking to provide financial services in the United States;
(ii) efficiently deliver information and services that are financial in nature through the use of technological means, including any application necessary to protect the security or efficacy of systems for the transmission of data or financial transactions; and
(iii) offer customers any available or emerging technological means for using financial services or for the document imaging of data.
(3) Authorization of new financial activities
The Secretary of the Treasury shall, by regulation or order and in accordance with paragraph (1)(B), define, consistent with the purposes of this Act 1 and the Gramm-Leach-Bliley Act, the following activities as, and the extent to which such activities are, financial in nature or incidental to a financial activity:
(A) Lending, exchanging, transferring, investing for others, or safeguarding financial assets other than money or securities.
(B) Providing any device or other instrumentality for transferring money or other financial assets.
(C) Arranging, effecting, or facilitating financial transactions for the account of third parties.
(c) Capital deduction
(1) Capital deduction required
In determining compliance with applicable capital standards—
(A) the aggregate amount of the outstanding equity investment, including retained earnings, of a national bank in all financial subsidiaries shall be deducted from the assets and tangible equity of the national bank; and
(B) the assets and liabilities of the financial subsidiaries shall not be consolidated with those of the national bank.
(2) Financial statement disclosure of capital deduction
Any published financial statement of a national bank that controls a financial subsidiary shall, in addition to providing information prepared in accordance with generally accepted accounting principles, separately present financial information for the bank in the manner provided in paragraph (1).
(d) Safeguards for the bank
A national bank that establishes or maintains a financial subsidiary shall assure that—
(1) the procedures of the national bank for identifying and managing financial and operational risks within the national bank and the financial subsidiary adequately protect the national bank from such risks;
(2) the national bank has, for the protection of the bank, reasonable policies and procedures to preserve the separate corporate identity and limited liability of the national bank and the financial subsidiaries of the national bank; and
(3) the national bank is in compliance with this section.
(e) Provisions applicable to national banks that fail to continue to meet certain requirements
(1) In general
If a national bank or insured depository institution affiliate does not continue to meet the requirements of subsection (a)(2)(C) or subsection (d), the Comptroller of the Currency shall promptly give notice to the national bank to that effect describing the conditions giving rise to the notice.
(2) Agreement to correct conditions
Not later than 45 days after the date of receipt by a national bank of a notice given under paragraph (1) (or such additional period as the Comptroller of the Currency may permit), the national bank shall execute an agreement with the Comptroller of the Currency and any relevant insured depository institution affiliate shall execute an agreement with its appropriate Federal banking agency to comply with the requirements of subsection (a)(2)(C) and subsection (d).
(3) Imposition of conditions
Until the conditions described in a notice under paragraph (1) are corrected—
(A) the Comptroller of the Currency may impose such limitations on the conduct or activities of the national bank or any subsidiary of the national bank as the Comptroller of the Currency determines to be appropriate under the circumstances and consistent with the purposes of this section; and
(B) the appropriate Federal banking agency may impose such limitations on the conduct or activities of any relevant insured depository institution affiliate or any subsidiary of the institution as such agency determines to be appropriate under the circumstances and consistent with the purposes of this section.
(4) Failure to correct
If the conditions described in a notice to a national bank under paragraph (1) are not corrected within 180 days after the date of receipt by the national bank of the notice, the Comptroller of the Currency may require the national bank, under such terms and conditions as may be imposed by the Comptroller and subject to such extension of time as may be granted in the discretion of the Comptroller, to divest control of any financial subsidiary.
(5) Consultation
In taking any action under this subsection, the Comptroller shall consult with all relevant Federal and State regulatory agencies and authorities.
(f) Failure to meet standards of credit-worthiness meet 2 applicable criteria
(1) In general
A national bank that does not continue to meet standards of credit-worthiness established by the Comptroller of the Currency or other requirement of subsection (a)(2)(E) after acquiring or establishing a financial subsidiary shall not, directly or through a subsidiary, purchase or acquire any additional equity capital of any financial subsidiary until the bank meets such requirements.
(2) Equity capital
For purposes of this subsection, the term "equity capital" includes, in addition to any equity instrument, any debt instrument issued by a financial subsidiary, if the instrument qualifies as capital of the subsidiary under any Federal or State law, regulation, or interpretation applicable to the subsidiary.
(g) Definitions
For purposes of this section, the following definitions shall apply:
(1) Affiliate, company, control, and subsidiary
The terms "affiliate", "company", "control", and "subsidiary" have the meanings given those terms in
(2) Appropriate Federal banking agency, depository institution, insured bank, and insured depository institution
The terms "appropriate Federal banking agency", "depository institution", "insured bank", and "insured depository institution" have the meanings given those terms in
(3) Financial subsidiary
The term "financial subsidiary" means any company that is controlled by 1 or more insured depository institutions other than a subsidiary that—
(A) engages solely in activities that national banks are permitted to engage in directly and are conducted subject to the same terms and conditions that govern the conduct of such activities by national banks; or
(B) a national bank is specifically authorized by the express terms of a Federal statute (other than this section), and not by implication or interpretation, to control, such as by section 25 or 25A of the Federal Reserve Act [
(4) Eligible debt
The term "eligible debt" means unsecured long-term debt that—
(A) is not supported by any form of credit enhancement, including a guarantee or standby letter of credit; and
(B) is not held in whole or in any significant part by any affiliate, officer, director, principal shareholder, or employee of the bank or any other person acting on behalf of or with funds from the bank or an affiliate of the bank.
(5) Well capitalized
The term "well capitalized" has the meaning given the term in
(6) Well managed
The term "well managed" means—
(A) in the case of a depository institution that has been examined, unless otherwise determined in writing by the appropriate Federal banking agency—
(i) the achievement of a composite rating of 1 or 2 under the Uniform Financial Institutions Rating System (or an equivalent rating under an equivalent rating system) in connection with the most recent examination or subsequent review of the depository institution; and
(ii) at least a rating of 2 for management, if such rating is given; or
(B) in the case of any depository institution that has not been examined, the existence and use of managerial resources that the appropriate Federal banking agency determines are satisfactory.
(R.S. §5136A, as added
Editorial Notes
References in Text
The Gramm-Leach-Bliley Act, referred to in subsecs. (a)(2)(B)(iii), (b)(2)(A), (3), is
Section 25 of the Federal Reserve Act, referred to in subsec. (g)(3)(B), is classified to subchapter I (§601 et seq.) of
The Bank Service Company Act, referred to in subsec. (g)(3)(B), is
Prior Provisions
A prior section 5136A of the Revised Statutes was renumbered section 5136B by
Amendments
2010—Subsec. (a)(2)(E).
Subsec. (a)(3).
Subsec. (a)(3)(A).
"(i) the bank is 1 of the 50 largest insured banks and has not fewer than 1 issue of outstanding eligible debt that is currently rated within the 3 highest investment grade rating categories by a nationally recognized statistical rating organization; or
"(ii) the bank is 1 of the second 50 largest insured banks and meets the criteria set forth in clause (i) or such other criteria as the Secretary of the Treasury and the Board of Governors of the Federal Reserve System may jointly establish by regulation and determine to be comparable to and consistent with the purposes of the rating required in clause (i)."
Subsec. (f).
Subsec. (f)(1).
Statutory Notes and Related Subsidiaries
Effective Date of 2010 Amendment
Effective Date
Section effective 120 days after Nov. 12, 1999, see section 161 of
2 So in original. Probably should be "or meet".
§25. Omitted
Editorial Notes
Codification
Section, act July 1, 1922, ch. 257, §2,
§25a. Participation by national banks in lotteries and related activities
(a) Prohibited activities
A national bank may not—
(1) deal in lottery tickets;
(2) deal in bets used as a means or substitute for participation in a lottery;
(3) announce, advertise, or publicize the existence of any lottery; 1
(4) announce, advertise, or publicize the existence or identity of any participant or winner, as such, in a lottery.
(b) Use of banking premises prohibited
A national bank may not permit—
(1) the use of any part of any of its banking offices by any person for any purpose forbidden to the bank under subsection (a), or
(2) direct access by the public from any of its banking offices to any premises used by any person for any purpose forbidden to the bank under subsection (a).
(c) Definitions
As used in this section—
(1) The term "deal in" includes making, taking, buying, selling, redeeming, or collecting.
(2) The term "lottery" includes any arrangement, other than a savings promotion raffle, whereby three or more persons (the "participants") advance money or credit to another in exchange for the possibility or expectation that one or more but not all of the participants (the "winners") will receive by reason of their advances more than the amounts they have advanced, the identity of the winners being determined by any means which includes—
(A) a random selection;
(B) a game, race, or contest; or
(C) any record or tabulation of the result of one or more events in which any participant has no interest except for its bearing upon the possibility that he may become a winner.
(3) The term "lottery ticket" includes any right, privilege, or possibility (and any ticket, receipt, record, or other evidence of any such right, privilege, or possibility) of becoming a winner in a lottery.
(4) The term "savings promotion raffle" means a contest in which the sole consideration required for a chance of winning designated prizes is obtained by the deposit of a specified amount of money in a savings account or other savings program, where each ticket or entry has an equal chance of being drawn, such contest being subject to regulations that may from time to time be promulgated by the appropriate prudential regulator (as defined in
(d) Lawful banking services connected with operation of lotteries
Nothing contained in this section prohibits a national bank from accepting deposits or cashing or otherwise handling checks or other negotiable instruments, or performing other lawful banking services for a State operating a lottery, or for an officer or employee of that State who is charged with the administration of the lottery.
(e) Regulations; enforcement
The Comptroller of the Currency shall issue such regulations as may be necessary to the strict enforcement of this section and the prevention of evasions thereof.
(R.S. §5136B, formerly §5136A, as added
Editorial Notes
Amendments
2014—Subsec. (c)(2).
Subsec. (c)(4).
Statutory Notes and Related Subsidiaries
Effective Date
Findings
"(1) the annual savings rate in the United States was 4.1 percent in 2012;
"(2) more than 40 percent of American households lack the savings to cover basic expenses for 3 months, if an unexpected event leads to a loss of stable income;
"(3) personal savings provide Americans with the financial resources to meet future needs, including higher education and homeownership, while also providing a safety net to weather unexpected financial shocks;
"(4) prize-linked savings products are typical savings products offered by financial institutions, like savings accounts, certificates of deposit, and savings bonds, with the added feature of offering chances to win prizes based on deposit activity;
"(5) the State of Michigan was the first State to allow credit unions to offer prize-linked savings products, and in 2009 launched the first large-scale prize-linked savings product in the United States;
"(6) the States of Connecticut, Michigan, Maine, Maryland, Nebraska, North Carolina, Rhode Island, and Washington all have laws that allow financial institutions to offer prize-linked savings products;
"(7) in the States of Michigan and Nebraska, more than 42,000 individuals have opened prize-linked savings accounts and saved more than $72,000,000;
"(8) prize-linked savings products have been shown to successfully attract non-savers, the asset poor, and low-to-moderate income groups, providing individuals with a new tool to build personal savings; and
"(9) encouraging personal savings is in the national interest of the United States."
1 So in original. The word "or" probably should appear.
§25b. State law preemption standards for national banks and subsidiaries clarified
(a) Definitions
For purposes of this section, the following definitions shall apply:
(1) National bank
The term "national bank" includes—
(A) any bank organized under the laws of the United States; and
(B) any Federal branch established in accordance with the International Banking Act of 1978 [
(2) State consumer financial laws
The term "State consumer financial law" means a State law that does not directly or indirectly discriminate against national banks and that directly and specifically regulates the manner, content, or terms and conditions of any financial transaction (as may be authorized for national banks to engage in), or any account related thereto, with respect to a consumer.
(3) Other definitions
The terms "affiliate", "subsidiary", "includes", and "including" have the same meanings as in
(b) Preemption standard
(1) In general
State consumer financial laws are preempted, only if—
(A) application of a State consumer financial law would have a discriminatory effect on national banks, in comparison with the effect of the law on a bank chartered by that State;
(B) in accordance with the legal standard for preemption in the decision of the Supreme Court of the United States in Barnett Bank of Marion County, N. A. v. Nelson, Florida Insurance Commissioner, et al., 517 U.S. 25 (1996), the State consumer financial law prevents or significantly interferes with the exercise by the national bank of its powers; and any preemption determination under this subparagraph may be made by a court, or by regulation or order of the Comptroller of the Currency on a case-by-case basis, in accordance with applicable law; or
(C) the State consumer financial law is preempted by a provision of Federal law other than title 62 of the Revised Statutes.
(2) Savings clause
Title 62 of the Revised Statutes and
(3) Case-by-case basis
(A) Definition
As used in this section the term "case-by-case basis" refers to a determination pursuant to this section made by the Comptroller concerning the impact of a particular State consumer financial law on any national bank that is subject to that law, or the law of any other State with substantively equivalent terms.
(B) Consultation
When making a determination on a case-by-case basis that a State consumer financial law of another State has substantively equivalent terms as one that the Comptroller is preempting, the Comptroller shall first consult with the Bureau of Consumer Financial Protection and shall take the views of the Bureau into account when making the determination.
(4) Rule of construction
Title 62 of the Revised Statutes does not occupy the field in any area of State law.
(5) Standards of review
(A) Preemption
A court reviewing any determinations made by the Comptroller regarding preemption of a State law by title 62 of the Revised Statutes or
(B) Savings clause
Except as provided in subparagraph (A), nothing in this section shall affect the deference that a court may afford to the Comptroller in making determinations regarding the meaning or interpretation of title LXII of the Revised Statutes of the United States or other Federal laws.
(6) Comptroller determination not delegable
Any regulation, order, or determination made by the Comptroller of the Currency under paragraph (1)(B) shall be made by the Comptroller, and shall not be delegable to another officer or employee of the Comptroller of the Currency.
(c) Substantial evidence
No regulation or order of the Comptroller of the Currency prescribed under subsection (b)(1)(B), shall be interpreted or applied so as to invalidate, or otherwise declare inapplicable to a national bank, the provision of the State consumer financial law, unless substantial evidence, made on the record of the proceeding, supports the specific finding regarding the preemption of such provision in accordance with the legal standard of the decision of the Supreme Court of the United States in Barnett Bank of Marion County, N.A. v. Nelson, Florida Insurance Commissioner, et al., 517 U.S. 25 (1996).
(d) Periodic review of preemption determinations
(1) In general
The Comptroller of the Currency shall periodically conduct a review, through notice and public comment, of each determination that a provision of Federal law preempts a State consumer financial law. The agency shall conduct such review within the 5-year period after prescribing or otherwise issuing such determination, and at least once during each 5-year period thereafter. After conducting the review of, and inspecting the comments made on, the determination, the agency shall publish a notice in the Federal Register announcing the decision to continue or rescind the determination or a proposal to amend the determination. Any such notice of a proposal to amend a determination and the subsequent resolution of such proposal shall comply with the procedures set forth in subsections (a) and (b) of
(2) Reports to Congress
At the time of issuing a review conducted under paragraph (1), the Comptroller of the Currency shall submit a report regarding such review to the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate. The report submitted to the respective committees shall address whether the agency intends to continue, rescind, or propose to amend any determination that a provision of Federal law preempts a State consumer financial law, and the reasons therefor.
(e) Application of State consumer financial law to subsidiaries and affiliates
Notwithstanding any provision of title 62 of the Revised Statutes or
(f) Preservation of powers related to charging interest
No provision of title 62 of the Revised Statutes shall be construed as altering or otherwise affecting the authority conferred by
(g) Transparency of OCC preemption determinations
The Comptroller of the Currency shall publish and update no less frequently than quarterly, a list of preemption determinations by the Comptroller of the Currency then in effect that identifies the activities and practices covered by each determination and the requirements and constraints determined to be preempted.
(h) Clarification of law applicable to nondepository institution subsidiaries and affiliates of national banks
(1) Definitions
For purposes of this subsection, the terms "depository institution", "subsidiary", and "affiliate" have the same meanings as in
(2) Rule of construction
No provision of title 62 of the Revised Statutes or
(i) Visitorial powers
(1) 1 In general
In accordance with the decision of the Supreme Court of the United States in Cuomo v. Clearing House Assn., L. L. C. (129 S. Ct. 2710 (2009)), no provision of title 62 of the Revised Statutes which relates to visitorial powers or otherwise limits or restricts the visitorial authority to which any national bank is subject shall be construed as limiting or restricting the authority of any attorney general (or other chief law enforcement officer) of any State to bring an action against a national bank in a court of appropriate jurisdiction to enforce an applicable law and to seek relief as authorized by such law.
(j) Enforcement actions
The ability of the Comptroller of the Currency to bring an enforcement action under title 62 of the Revised Statutes or
(R.S. §5136C, as added and amended
Editorial Notes
References in Text
The International Banking Act of 1978, referred to in subsec. (a)(1)(B), is
Title 62 of the Revised Statutes, referred to in subsecs. (b)(1)(C), (2), (4), (5)(A), (e), (f), (h)(2), (i)(1), and (j), was in the original a reference to "this title" or "This title" meaning title LXII of the Revised Statutes, consisting of R.S. §§5133 to 5244, which are classified to this section and
For classification of title LXII of the Revised Statutes of the United States, referred to in subsec. (b)(5)(B), see note above.
Amendments
2010—Subsec. (h).
Subsecs. (i), (j).
Statutory Notes and Related Subsidiaries
Effective Date
Enactment and amendment of section by
1 So in original. No par. (2) has been enacted.
§26. Comptroller to determine if association can commence business
Whenever a certificate is transmitted to the Comptroller of the Currency, as provided in title 62 of the Revised Statutes, and the association transmitting the same notifies the Comptroller that all of its capital stock has been duly paid in, and that such association has complied with all the provisions of title 62 of the Revised Statutes required to be complied with before an association shall be authorized to commence the business of banking, the Comptroller shall examine into the condition of such association, ascertain especially the amount of money paid in on account of its capital, the name and place of residence of each of its directors, and the amount of the capital stock of which each is the owner in good faith, and generally whether such association has complied with all the provisions of title 62 of the Revised Statutes required to entitle it to engage in the business of banking; and shall cause to be made and attested by the oaths of a majority of the directors, and by the president or cashier of the association, a statement of all the facts necessary to enable the Comptroller to determine whether the association is lawfully entitled to commence the business of banking.
(R.S. §5168;
Editorial Notes
References in Text
Title 62 of the Revised Statutes, referred to in text, was in the original "this Title" meaning title LXII of the Revised Statutes, consisting of R.S. §§5133 to 5244, which are classified this section and to
Codification
R.S. §5168 derived from act June 3, 1864, ch. 106, §17,
Amendments
1959—
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§27. Certificate of authority to commence banking
(a) If, upon a careful examination of the facts so reported, and of any other facts which may come to the knowledge of the Comptroller, whether by means of a special commission appointed by him for the purpose of inquiring into the condition of such association, or otherwise, it appears that such association is lawfully entitled to commence the business of banking, the Comptroller shall give to such association a certificate, under his hand and official seal, that such association has complied with all the provisions required to be complied with before commencing the business of banking, and that such association is authorized to commence such business. But the Comptroller may withhold from an association his certificate authorizing the commencement of business, whenever he has reason to suppose that the shareholders have formed the same for any other than the legitimate objects contemplated by title 62 of the Revised Statutes. A National Bank Association, to which the Comptroller of the Currency has heretofore issued or hereafter issues such certificate, is not illegally constituted solely because its operations are or have been required by the Comptroller of the Currency to be limited to those of a trust company and activities related thereto.
(b)(1) The Comptroller of the Currency may also issue a certificate of authority to commence the business of banking pursuant to this section to a national banking association which is owned exclusively (except to the extent directors' qualifying shares are required by law) by other depository institutions or depository institution holding companies and is organized to engage exclusively in providing services to or for other depository institutions, their holding companies, and the officers, directors, and employees of such institutions and companies, and in providing correspondent banking services at the request of other depository institutions or their holding companies (also referred to as a "banker's bank").
(2) Any national banking association chartered pursuant to paragraph (1) shall be subject to such rules, regulations, and orders as the Comptroller deems appropriate, and, except as otherwise specifically provided in such rules, regulations, or orders, shall be vested with or subject to the same rights, privileges, duties, restrictions, penalties, liabilities, conditions, and limitations that would apply under the national banking laws to a national bank.
(R.S. §5169;
Editorial Notes
References in Text
Title 62 of the Revised Statutes, referred to in subsec. (a), was in the original "this Title" meaning title LXII of the Revised Statutes, consisting of R.S. §§5133 to 5244, which are classified to this section and
Codification
R.S. §5169 derived from act June 3, 1864, ch. 106, §§12, 18,
Amendments
1994—Subsec. (b)(1).
1982—
1980—
1978—
Statutory Notes and Related Subsidiaries
Termination Date of 1980 Amendment
Effective Date of 1978 Amendment
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§28. Repealed. Pub. L. 103–325, title VI, §602(e)(1), Sept. 23, 1994, 108 Stat. 2291
Section, R.S. §5170, required publication of certificate of authority to commence banking for 60 days after issuance.
Editorial Notes
Codification
R.S. §5170 derived from act June 3, 1864, ch. 106, §18,
§29. Power to hold real property
A national banking association may purchase, hold, and convey real estate for the following purposes, and for no others:
First. Such as shall be necessary for its accommodation in the transaction of its business.
Second. Such as shall be mortgaged to it in good faith by way of security for debts previously contracted.
Third. Such as shall be conveyed to it in satisfaction of debts previously contracted in the course of its dealings.
Fourth. Such as it shall purchase at sales under judgments, decrees, or mortgages held by the association, or shall purchase to secure debts due to it.
But no such association shall hold the possession of any real estate under mortgage, or the title and possession of any real estate purchased to secure any debts due to it, for a longer period than five years except as otherwise provided in this section.
For real estate in the possession of a national banking association upon application by the association, the Comptroller of the Currency may approve the possession of any such real estate by such association for a period longer than five years, but not to exceed an additional five years, if (1) the association has made a good faith attempt to dispose of the real estate within the five-year period, or (2) disposal within the five-year period would be detrimental to the association. Upon notification by the association to the Comptroller of the Currency that such conditions exist that require the expenditure of funds for the development and improvement of such real estate, and subject to such conditions and limitations as the Comptroller of the Currency shall prescribe, the association may expend such funds as are needed to enable such association to recover its total investment.
Notwithstanding the five-year holding limitation of this section or any other provision of title 62 of the Revised Statutes, any national banking association which on October 15, 1982, held, directly or indirectly, real estate, including any subsurface rights or interests therein, that since December 31, 1979, had not been valued on the books of such association for more than a nominal amount, may continue to hold such real estate, rights, or interests for such longer period of time as would be permitted a State chartered bank by the law of the State in which the association is located if the aggregate amount of earnings from such real estate, rights, or interests is separately disclosed in the annual financial statements of the association.
(R.S. §5137; Feb. 25, 1927, ch. 191, §3,
Editorial Notes
References in Text
Title 62 of the Revised Statutes, referred to in last par., was in the original "this title" meaning title LXII of the Revised Statutes, consisting of R.S. §§5133 to 5244, which are classified to this section and
Codification
R.S. §5137 derived from act June 3, 1864, ch. 106, §28,
Amendments
1982—
1981—
1980—
1927—Par. First. Act Feb. 25, 1927, struck out "immediate," before "accommodation," in par. First.
§30. Change of name or location
(a) Name change
Any national banking association, upon written notice to the Comptroller of the Currency, may change its name, except that such new name shall include the word "National".
(b) Location change
Any national banking association, upon written notice to the Comptroller of the Currency, may change the location of its main office to any authorized branch location within the limits of the city, town, or village in which it is situated, or, with a vote of shareholders owning two-thirds of the stock of such association for a relocation outside such limits and upon receipt of a certificate of approval from the Comptroller of the Currency, to any other location within or outside the limits of the city, town, or village in which it is located, but not more than thirty miles beyond such limits.
(c) Coordination with section 36 of this title
In the case of a national bank which relocates the main office of such bank from 1 State to another State after May 31, 1997, the bank may retain and operate branches within the State from which the bank relocated such office only to the extent authorized in
(d) Retention of "Federal" in name of converted Federal savings association
(1) In general
Notwithstanding subsection (a) or any other provision of law, any depository institution, the charter of which is converted from that of a Federal savings association to a national bank or a State bank after November 12, 1999, may retain the term "Federal" in the name of such institution if such institution remains an insured depository institution.
(2) Definitions
For purposes of this subsection, the terms "depository institution", "insured depository institution", "national bank", and "State bank" have the meanings given those terms in
(May 1, 1886, ch. 73, §2,
Editorial Notes
Amendments
1999—Subsec. (d).
1994—Subsec. (c).
1983—Subsec. (b).
1982—
1959—
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§31. Rights and liabilities as affected by change of name
All debts, liabilities, rights, provisions, and powers of the association under its old name shall devolve upon and inure to the association under its new name.
(May 1, 1886, ch. 73, §3,
§32. Liabilities and suits as affected by change of name or location
Nothing contained in
(May 1, 1886, ch. 73, §4,
§§33 to 34c. Transferred
Editorial Notes
Codification
Act Nov. 7, 1918, ch. 209,
Section 33, acts Nov. 7, 1918, ch. 209, §1,
Section 34, act Nov. 7, 1918, ch. 209, §2,
Section 34a, act Nov. 7, 1918, ch. 209, §3, as added Feb. 25, 1927, ch. 191, §1,
Section 34b, act Nov. 7, 1918, ch. 209, §4, as added July 14, 1952, ch. 722, §1,
Section 34c, act Nov. 7, 1918, ch. 209, §5, as added July 14, 1952, ch. 722, §1, 66, Stat. 601, related to definitions. See
§35. Organization of State banks as national banking associations
Any bank incorporated by special law of any State or of the United States or organized under the general laws of any State or of the United States and having an unimpaired capital sufficient to entitle it to become a national banking association under the provisions of the existing laws may, by the vote of the shareholders owning not less than fifty-one per centum of the capital stock of such bank or banking association, with the approval of the Comptroller of the Currency be converted into a national banking association, with a name that contains the word "national": Provided, however, That said conversion shall not be in contravention of the State law. In such case the articles of association and organization certificate may be executed by a majority of the directors of the bank or banking institution, and the certificate shall declare that the owners of fifty-one per centum of the capital stock have authorized the directors to make such certificate and to change or convert the bank or banking institution into a national association. A majority of the directors, after executing the articles of association and the organization certificate, shall have power to execute all other papers and to do whatever may be required to make its organization perfect and complete as a national association. The shares of any such bank may continue to be for the same amount each as they were before the conversion, and the directors may continue to be directors of the association until others are elected or appointed in accordance with the provisions of the statutes of the United States. When the Comptroller has given to such bank or banking association a certificate that the provisions of this Act have been complied with, such bank or banking association, and all its stockholders, officers, and employees shall have the same powers and privileges and shall be subject to the same duties, liabilities, and regulations, in all respects, as shall have been prescribed by the Federal Reserve Act [
The Comptroller of the Currency may, in his discretion and subject to such conditions as he may prescribe, permit such converting bank to retain and carry at a value determined by the Comptroller such of the assets of such converting bank as do not conform to the legal requirements relative to assets acquired and held by national banking associations. The Comptroller of the Currency may not approve the conversion of a State bank or State savings association to a national banking association or Federal savings association during any period in which the State bank or State savings association is subject to a cease and desist order (or other formal enforcement order) issued by, or a memorandum of understanding entered into with, a State bank supervisor or the appropriate Federal banking agency with respect to a significant supervisory matter or a final enforcement action by a State Attorney General.
(R.S. §5154; Dec. 23, 1913, ch. 6, §8,
Editorial Notes
References in Text
This Act, referred to in first par., may refer to the Federal Reserve Act, act Dec. 23, 1913, from which this wording is derived; or section 5154 of the Revised Statutes which the Federal Reserve Act amended; or act June 3, 1864, from which R.S. §5154 was derived; or Congress might have intended to refer to the preceding provisions of the 1913 amendment. Similar reference in R.S. §5154 prior to 1913 amendment was to "this Title," meaning title 62 of the Revised Statutes, which title comprised the National Bank Act (June 3, 1864, ch. 106,
The Federal Reserve Act, referred to in text, is act Dec. 23, 1913, ch. 6,
The National Banking Act, referred to in text, is probably intended to be a reference to the National Bank Act, act June 3, 1864, ch. 106,
Codification
R.S. §5154 derived from act June 3, 1864, ch. 106, §44,
Amendments
2010—
1983—
1935—Act Aug. 23, 1935, added last par.
Statutory Notes and Related Subsidiaries
Effective Date of 2010 Amendment
Amendment by
Exception to Prohibition on Approval of Conversions
"(1) the Federal banking agency that would be the appropriate Federal banking agency after the proposed conversion gives the appropriate Federal banking agency or State bank supervisor that issued the cease and desist order (or other formal enforcement order) or memorandum of understanding, as appropriate, written notice of the proposed conversion including a plan to address the significant supervisory matter in a manner that is consistent with the safe and sound operation of the institution;
"(2) within 30 days of receipt of the written notice required under paragraph (1), the appropriate Federal banking agency or State bank supervisor that issued the cease and desist order (or other formal enforcement order) or memorandum of understanding, as appropriate, does not object to the conversion or the plan to address the significant supervisory matter;
"(3) after conversion of the insured depository institution, the appropriate Federal banking agency after the conversion implements such plan; and
"(4) in the case of a final enforcement action by a State Attorney General, approval of the conversion is conditioned on compliance by the insured depository institution with the terms of such final enforcement action."
[For definitions of terms used in section 612(d) of
Notification of Pending Enforcement Actions
"(1)
"(A) the appropriate Federal banking agency for the insured depository institution; and
"(B) the Federal banking agency that would be the appropriate Federal banking agency of the insured depository institution after the proposed conversion.
"(2)
"(A) notify the Federal banking agency that would be the appropriate Federal banking agency for the institution after the proposed conversion in writing of any ongoing supervisory or investigative proceedings that the appropriate Federal banking agency for the institution proposing to convert believes is likely to result, in the near term and absent the proposed conversion, in a cease and desist order (or other formal enforcement order) or memorandum of understanding with respect to a significant supervisory matter; and
"(B) provide the Federal banking agency that would be the appropriate Federal banking agency for the institution after the proposed conversion access to all investigative and supervisory information relating to the proceedings described in subparagraph (A)."
[For definitions of terms used in section 612(e) of
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§36. Branch banks
The conditions upon which a national banking association may retain or establish and operate a branch or branches are the following:
(a) Lawful and continuous operation
A national banking association may retain and operate such branch or branches as it may have had in lawful operation on February 25, 1927, and any national banking association which continuously maintained and operated not more than one branch for a period of more than twenty-five years immediately preceding February 25, 1927, may continue to maintain and operate such branch.
(b) Converted State banks
(1) A national bank resulting from the conversion of a State bank may retain and operate as a branch any office which was a branch of the State bank immediately prior to conversion if such office—
(A) might be established under subsection (c) of this section as a new branch of the resulting national bank, and is approved by the Comptroller of the Currency for continued operation as a branch of the resulting national bank;
(B) was a branch of any bank on February 25, 1927; or
(C) is approved by the Comptroller of the Currency for continued operation as a branch of the resulting national bank.
The Comptroller of the Currency may not grant approval under clause (C) of this paragraph if a State bank (in a situation identical to that of the national bank) resulting from the conversion of a national bank would be prohibited by the law of such State from retaining and operating as a branch an identically situated office which was a branch of the national bank immediately prior to conversion.
(2) A national bank (referred to in this paragraph as the "resulting bank"), resulting from the consolidation of a national bank (referred to in this paragraph as the "national bank") under whose charter the consolidation is effected with another bank or banks, may retain and operate as a branch any office which, immediately prior to such consolidation, was in operation as—
(A) a main office or branch office of any bank (other than the national bank) participating in the consolidation if, under subsection (c) of this section, it might be established as a new branch of the resulting bank, and if the Comptroller of the Currency approves of its continued operation after the consolidation;
(B) a branch of any bank participating in the consolidation, and which, on February 25, 1927, was in operation as a branch of any bank; or
(C) a branch of the national bank and which, on February 25, 1927, was not in operation as a branch of any bank, if the Comptroller of the Currency approves of its continued operation after the consolidation.
The Comptroller of the Currency may not grant approval under clause (C) of this paragraph if a State bank (in a situation identical to that of the resulting national bank) resulting from the consolidation into a State bank of another bank or banks would be prohibited by the law of such State from retaining and operating as a branch an identically situated office which was a branch of the State bank immediately prior to consolidation.
(3) As used in this subsection, the term "consolidation" includes a merger.
(c) New branches
A national banking association may, with the approval of the Comptroller of the Currency, establish and operate new branches: (1) Within the limits of the city, town or village in which said association is situated, if such establishment and operation are at the time expressly authorized to State banks by the law of the State in question; and (2) at any point within the State in which said association is situated, if such establishment and operation are at the time authorized to State banks by the statute law of the State in question by language specifically granting such authority affirmatively and not merely by implication or recognition, and subject to the restrictions as to location imposed by the law of the State on State banks. In any State in which State banks are permitted by statute law to maintain branches within county or greater limits, if no bank is located and doing business in the place where the proposed agency is to be located, any national banking association situated in such State may, with the approval of the Comptroller of the Currency, establish and operate, without regard to the capital requirements of this section, a seasonal agency in any resort community within the limits of the county in which the main office of such association is located, for the purpose of receiving and paying out deposits, issuing and cashing checks and drafts, and doing business incident thereto: Provided, That any permit issued under this sentence shall be revoked upon the opening of a State or national bank in such community. Except as provided in the immediately preceding sentence, no such association shall establish a branch outside of the city, town, or village in which it is situated unless it has a combined capital stock and surplus equal to the combined amount of capital stock and surplus, if any, required by the law of the State in which such association is situated for the establishment of such branches by State banks, or, if the law of such State requires only a minimum capital stock for the establishment of such branches by State banks, unless such association has not less than an equal amount of capital stock.
(d) Branches resulting from interstate merger transactions
A national bank resulting from an interstate merger transaction (as defined in section 1831u(f)(6) 1 of this title) may maintain and operate a branch in a State other than the home State (as defined in subsection (g)(3)(B)) of such bank in accordance with
(e) Exclusive authority for additional branches
(1) In general
Effective June 1, 1997, a national bank may not acquire, establish, or operate a branch in any State other than the bank's home State (as defined in subsection (g)(3)(B)) or a State in which the bank already has a branch unless the acquisition, establishment, or operation of such branch in such State by such national bank is authorized under this section or
(2) Retention of branches
In the case of a national bank which relocates the main office of such bank from 1 State to another State after May 31, 1997, the bank may retain and operate branches within the State which was the bank's home State (as defined in subsection (g)(3)(B)) before the relocation of such office only to the extent the bank would be authorized, under this section or any other provision of law referred to in paragraph (1), to acquire, establish, or commence to operate a branch in such State if—
(A) the bank had no branches in such State; or
(B) the branch resulted from—
(i) an interstate merger transaction approved pursuant to
(ii) a transaction after May 31, 1997, pursuant to which the bank received assistance from the Federal Deposit Insurance Corporation under
(f) Law applicable to interstate branching operations
(1) Law applicable to national bank branches
(A) In general
The laws of the host State regarding community reinvestment, consumer protection, fair lending, and establishment of intrastate branches shall apply to any branch in the host State of an out-of-State national bank to the same extent as such State laws apply to a branch of a bank chartered by that State, except—
(i) when Federal law preempts the application of such State laws to a national bank; or
(ii) when the Comptroller of the Currency determines that the application of such State laws would have a discriminatory effect on the branch in comparison with the effect the application of such State laws would have with respect to branches of a bank chartered by the host State.
(B) Enforcement of applicable State laws
The provisions of any State law to which a branch of a national bank is subject under this paragraph shall be enforced, with respect to such branch, by the Comptroller of the Currency.
(C) Review and report on actions by Comptroller
The Comptroller of the Currency shall conduct an annual review of the actions it has taken with regard to the applicability of State law to national banks (or their branches) during the preceding year, and shall include in its annual report required under
(2) Treatment of branch as bank
All laws of a host State, other than the laws regarding community reinvestment, consumer protection, fair lending, establishment of intrastate branches, and the application or administration of any tax or method of taxation, shall apply to a branch (in such State) of an out-of-State national bank to the same extent as such laws would apply if the branch were a national bank the main office of which is in such State.
(3) Rule of construction
No provision of this subsection may be construed as affecting the legal standards for preemption of the application of State law to national banks.
(g) State "opt-in" election to permit interstate branching through de novo branches
(1) In general
Subject to paragraph (2), the Comptroller of the Currency may approve an application by a national bank to establish and operate a de novo branch in a State (other than the bank's home State) in which the bank does not maintain a branch if—
(A) the law of the State in which the branch is located, or is to be located, would permit establishment of the branch, if the national bank were a State bank chartered by such State; and
(B) the conditions established in, or made applicable to this paragraph by, paragraph (2) are met.
(2) Conditions on establishment and operation of interstate branch
(A) Establishment
An application by a national bank to establish and operate a de novo branch in a host State shall be subject to the same requirements and conditions to which an application for an interstate merger transaction is subject under paragraphs (1), (3), and (4) of
(B) Operation
Subsections (c) and (d)(2) of
(3) Definitions
The following definitions shall apply for purposes of this section:
(A) De novo branch
The term "de novo branch" means a branch of a national bank which—
(i) is originally established by the national bank as a branch; and
(ii) does not become a branch of such bank as a result of—
(I) the acquisition by the bank of an insured depository institution or a branch of an insured depository institution; or
(II) the conversion, merger, or consolidation of any such institution or branch.
(B) Home State
The term "home State" means the State in which the main office of a national bank is located.
(C) Host State
The term "host State" means, with respect to a bank, a State, other than the home State of the bank, in which the bank maintains, or seeks to establish and maintain, a branch.
(h) Repealed. Pub. L. 104–208, div. A, title II, §2204, Sept. 30, 1996, 110 Stat. 3009–405
(i) Prior approval of branch locations
No branch of any national banking association shall be established or moved from one location to another without first obtaining the consent and approval of the Comptroller of the Currency.
(j) "Branch" defined
The term "branch" as used in this section shall be held to include any branch bank, branch office, branch agency, additional office, or any branch place of business located in any State or Territory of the United States or in the District of Columbia at which deposits are received, or checks paid, or money lent. The term "branch", as used in this section, does not include an automated teller machine or a remote service unit.
(k) Branches in foreign countries, dependencies, or insular possessions
This section shall not be construed to amend or repeal section 25 of the Federal Reserve Act, as amended [
(l) "State bank" and "bank" defined
The words "State bank," "State banks," "bank," or "banks," as used in this section, shall be held to include trust companies, savings banks, or other such corporations or institutions carrying on the banking business under the authority of State laws.
(R.S. §5155; Feb. 25, 1927, ch. 191, §7,
Editorial Notes
References in Text
Section 25 of the Federal Reserve Act, as amended, referred to in subsec. (k), is classified to subchapter I (§601 et seq.) of
Codification
R.S. §5155 derived from act Mar. 3, 1865, ch. 78, §7,
Amendments
2010—Subsec. (g)(1)(A).
"(i) applies equally to all banks; and
"(ii) expressly permits all out-of-State banks to establish de novo branches in such State; and".
1997—Subsec. (f)(1)(C).
1996—Subsec. (h).
Subsec. (j).
1994—Subsecs. (d) to (f).
Subsec. (g).
Subsecs. (h) to (l).
1962—Subsec. (b).
1952—Subsec. (c). Act July 15, 1952, struck out the minimum capital requirement for the establishment of branches by national banks.
1935—Subsec. (c). Act Aug. 23, 1935, inserted second sentence and substituted "Except as provided in the immediately preceding sentence, no" for "No" in last sentence.
1933—Subsecs. (c), (d). Act June 16, 1933, amended subsecs. (c) and (d).
1927—Act Feb. 25, 1927, amended section generally.
Statutory Notes and Related Subsidiaries
Effective Date of 2010 Amendment
Amendment by
Right of State To Opt Out
Nothing in
Applicability of McFadden Act to Present Financial Environment; Report and Recommendations by President to Congress
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
1 See References in Text note below.
§37. Associations governed by chapter
The provisions of chapters 2, 3, and 4 of title 62 of the Revised Statutes, which are expressed without restrictive words, as applying to "national banking associations," or to "associations," apply to all associations organized to carry on the business of banking under any Act of Congress.
(R.S. §5157.)
Editorial Notes
References in Text
Chapters 2, 3, and 4 of title 62 of the Revised Statutes, referred to in text, was in the original "chapters two, three, and four of this Title," meaning chapters 2, 3, and 4 of title 62 of the Revised Statutes, consisting of R.S. §§5157 to 5244, which are classified to this section and
§38. The National Bank Act
The Act entitled "An Act to provide a national currency secured by a pledge of United States bonds, and to provide for the circulation and redemption thereof," approved June 3, 1864, shall be known as "The National Bank Act."
(June 20, 1874, ch. 343, §1,
Editorial Notes
References in Text
The National Bank Act, referred to in text, is act June 3, 1864, ch. 106,
§39. Reservation of rights of associations organized under Act of 1863
Nothing in title 62 of the Revised Statutes shall affect any appointments made, acts done, or proceedings had or commenced prior to the third day of June 1864, in or toward the organization of any national banking association under the act of February 25, 1863; but all associations which, on the third day of June 1864, were organized or commenced to be organized under that act, shall enjoy all the rights and privileges granted, and be subject to all the duties, liabilities, and restrictions imposed by title 62 of the Revised Statutes, notwithstanding all the steps prescribed by title 62 of the Revised Statutes for the organization of associations were not pursued, if such associations were duly organized under that act.
(R.S. §5156.)
Editorial Notes
References in Text
Title 62 of the Revised Statutes, referred to in text, was in the original "this Title" meaning title LXII of the Revised Statutes, consisting of R.S. §§5133 to 5244, which are classified to this section and
Act of February 25, 1863, referred to in text, was act Feb. 25, 1863, ch. 58,
Codification
R.S. §5156 derived from act June 3, 1864, ch. 106, §62,
§40. Virgin Islands; extension of National Bank Act
The National Bank Act, as amended [
(July 19, 1932, ch. 508,
Editorial Notes
References in Text
The National Bank Act, referred to in text, is act June 3, 1864, ch. 106,
§41. Guam; extension of National Bank Act
The National Bank Act [
(Aug. 1, 1956, ch. 852, §2,
Editorial Notes
References in Text
The National Bank Act, referred to in text, is act June 3, 1864, ch. 106,
§42. Territorial application
The provisions of all Acts of Congress relating to national banks shall apply in the several States, the District of Columbia, the several Territories and possessions of the United States, and the Commonwealth of Puerto Rico.
(
§43. Interpretations concerning preemption of certain State laws
(a) Notice and opportunity for comment required
Before issuing any opinion letter or interpretive rule, in response to a request or upon the agency's own motion, that concludes that Federal law preempts the application to a national bank of any State law regarding community reinvestment, consumer protection, fair lending, or the establishment of intrastate branches, or before making a determination under
(1) publish in the Federal Register notice of the preemption or discrimination issue that the agency is considering (including a description of each State law at issue);
(2) give interested parties not less than 30 days in which to submit written comments; and
(3) in developing the final opinion letter or interpretive rule issued by the agency, or making any determination under
(b) Publication required
The appropriate Federal banking agency shall publish in the Federal Register—
(1) any final opinion letter or interpretive rule concluding that Federal law preempts the application of any State law regarding community reinvestment, consumer protection, fair lending, or establishment of intrastate branches to a national bank; and
(2) any determination under
(c) Exceptions
(1) No new issue or significant basis
This section shall not apply with respect to any opinion letter or interpretive rule that—
(A) raises issues of Federal preemption of State law that are essentially identical to those previously resolved by the courts or on which the agency has previously issued an opinion letter or interpretive rule; or
(B) responds to a request that contains no significant legal basis on which to make a preemption determination.
(2) Judicial, legislative, or intragovernmental materials
This section shall not apply with respect to materials prepared for use in judicial proceedings or submission to Congress or a Member of Congress, or for intragovernmental use.
(3) Emergency
The appropriate Federal banking agency may make exceptions to subsection (a) if—
(A) the agency determines in writing that the exception is necessary to avoid a serious and imminent threat to the safety and soundness of any national bank; or
(B) the opinion letter or interpretive rule is issued in connection with—
(i) an acquisition of 1 or more banks in default or in danger of default (as such terms are defined in
(ii) an acquisition with respect to which the Federal Deposit Insurance Corporation provides assistance under
(R.S. §5244, as added
Editorial Notes
Codification
Another R.S. §5244 is classified to
SUBCHAPTER II—CAPITAL, STOCK, AND STOCKHOLDERS
§51. Repealed. Pub. L. 106–569, title XII, §1233(c), Dec. 27, 2000, 114 Stat. 3037
Section, R.S. §5138; Mar. 14, 1900, ch. 41, §10,
§51a. Preferred stock; issuance authorized
Notwithstanding any other provision of law, any national banking association may, with the approval of the Comptroller of the Currency and by vote of shareholders owning a majority of the stock of such association, upon not less than five days' notice, given by registered mail or by certified mail pursuant to action taken by its board of directors, issue preferred stock of one or more classes, in such amount and with such par value as shall be approved by said Comptroller, and make such amendments to its articles of association as may be necessary for this purpose; but, in the case of any newly organized national banking association which has not yet issued common stock, the requirement of notice to and vote of shareholders shall not apply. No issue of preferred stock shall be valid until the par value of all stock so issued shall be paid in and notice thereof, duly acknowledged before a notary public by the president, vice president, or cashier of said association, has been transmitted to the Comptroller of the Currency and his certificate obtained specifying the amount of such issue of preferred stock and his approval thereof and that the amount has been duly paid in as a part of the capital of such association; which certificate shall be deemed to be conclusive evidence that such preferred stock has been duly and validly issued.
(Mar. 9, 1933, ch. 1, title III, §301,
Editorial Notes
Amendments
1960—
1935—Act Aug. 23, 1935, amended last sentence generally.
1933—Act June 15, 1933, struck out all of former section and inserted a new section which incorporated all former provisions and inserted "of one or more classes," in first sentence.
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§51b. Dividends, voting, and retirement of preferred stock; individual liability
(a) Notwithstanding any other provision of law, whether relating to restriction upon the payment of dividends upon capital stock or otherwise, the holders of such preferred stock shall be entitled to receive such cumulative dividends and shall have such voting and conversion rights and such control of management, and such stock shall be subject to retirement in such manner and upon such conditions, as may be provided in the articles of association with the approval of the Comptroller of the Currency. The holders of such preferred stock shall not be held individually responsible as such holders for any debts, contracts, or engagements of such association, and shall not be liable for assessments to restore impairments in the capital of such association as now provided by law with reference to holders of common stock.
(b) No dividends shall be declared or paid on common stock until the cumulative dividends on the preferred stock shall have been paid in full; and, if the association is placed in voluntary liquidation or a conservator or a receiver is appointed therefor, no payments shall be made to the holders of the common stock until the holders of the preferred stock shall have been paid in full the par value of such stock plus all accumulated dividends.
(Mar. 9, 1933, ch. 1, title III, §302,
Editorial Notes
Amendments
1980—Subsec. (a).
1933—Subsec. (a). Act June 15, 1933, struck out former subsec. (a) and inserted a new subsec. (a) which incorporated all former provisions and inserted "Notwithstanding any other provision of law, whether relating to restriction upon the payment of dividends upon capital stock or otherwise" and "and conversion rights," in first sentence.
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§51b–1. Consideration of preferred stock in determining impairment of capital; dividends; retirement
If any part of the capital of a national bank, State member bank, or bank applying for membership in the Federal Reserve System consists of preferred stock, the determination of whether or not the capital of such bank is impaired and the amount of such impairment shall be based upon the par value of its stock even though the amount which the holders of such preferred stock shall be entitled to receive in the event of retirement or liquidation shall be in excess of the par value of such preferred stock. If any such bank or trust company shall have outstanding any capital notes or debentures of the type which the Reconstruction Finance Corporation is authorized to purchase pursuant to the provisions of
(Aug. 23, 1935, ch. 614, title III, §345,
Editorial Notes
References in Text
The Emergency Banking and Bank Conservation Act, approved March 9, 1933, as amended, referred to in text, is act Mar. 9, 1933, ch. 1,
Amendments
1980—
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§51c. "Common stock", "capital", and "capital stock" defined
The term "common stock" as used in sections 51a, 51b, 51c, and 51d 1 of this title means stock of national banking associations other than preferred stock issued under the provisions of said sections. The term "capital" as used in provisions of law relating to the capital of national banking associations shall mean the amount of unimpaired common stock plus the amount of preferred stock outstanding and unimpaired; and the term "capital stock", as used in sections 101, 177, and 178 1 of this title, shall mean only the amount of common stock outstanding.
(Mar. 9, 1933, ch. 1, title III, §303,
Editorial Notes
References in Text
1 See References in Text note below.
§§51d to 51f. Repealed. June 30, 1947, ch. 166, title II, §206(b), (o), 61 Stat. 208
Section 51d, acts Mar. 9, 1933, ch. 1, title III, §304,
Sections 51e and 51f, act Mar. 20, 1936, ch. 160, §§2, 3,
§52. Par value and incidents of stock; transfer of shares
The capital stock of each association shall be divided into shares of $100 each, or into shares of such less amount as may be provided in the articles of association, and be deemed personal property, and transferable on the books of the association in such manner as may be prescribed in the by-laws or articles of association. Every person becoming a shareholder by such transfer shall, in proportion to his shares, succeed to all rights and liabilities of the prior holder of such shares; and no change shall be made in the articles of association by which the rights, remedies, or security of the existing creditors of the association shall be impaired.
Certificates issued after August 23, 1935, representing shares of stock of the association shall state (1) the name and location of the association, (2) the name of the holder of record of the stock represented thereby, (3) the number and class of shares which the certificate represents, and (4) if the association shall issue stock of more than one class, the respective rights, preferences, privileges, voting rights, powers, restrictions, limitations, and qualifications of each class of stock issued shall be stated in full or in summary upon the front or back of the certificates or shall be incorporated by a reference to the articles of association set forth on the front of the certificates. Every certificate shall be signed by the president and the cashier of the association, or by such other officers as the bylaws of the association shall provide, and shall be sealed with the seal of the association.
After August 23, 1935, no certificate evidencing the stock of any such association shall bear any statement purporting to represent the stock of any other corporation, except a member bank or a corporation engaged on June 16, 1934, in holding the bank premises of such association, nor shall the ownership, sale, or transfer of any certificate representing the stock of any such association be conditioned in any manner whatsoever upon the ownership, sale, or transfer of a certificate representing the stock of any other corporation, except a member bank or a corporation engaged on June 16, 1934 in holding the bank premises of such association: Provided, That this section shall not operate to prevent the ownership, sale, or transfer of stock of any other corporation being conditioned upon the ownership, sale, or transfer of a certificate representing stock of a national banking association.
(R.S. §5139; Feb. 25, 1927, ch. 191, §16,
Editorial Notes
Codification
R.S. §5139 derived from act June 3, 1864, ch. 106, §12,
Amendments
1935—Act Aug. 23, 1935, §335, added second par.
Act Aug. 23, 1935, §310(a), among other changes in last par., inserted proviso.
1933—Act June 16, 1933, added last par.
1927—Act Feb. 25, 1927, inserted "or into shares of such less amount as may be provided in the articles of association" in first sentence.
§53. When capital stock paid in
All of the capital stock of every national banking association shall be paid in before it shall be authorized to commence business.
(R.S. §5140;
Editorial Notes
Codification
R.S. §5140 derived from act June 3, 1864, ch. 106, §14,
Amendments
1959—
§54. Repealed. Pub. L. 86–230, §5, Sept. 8, 1959, 73 Stat. 457
Section, R.S. §5141, related to failure to pay installments, remedy and effect if reduction of capital resulted.
§55. Enforcing payment of deficiency in capital stock; assessments; liquidation; receivership
Every association which shall have failed to pay up its capital stock, as required by law, and every association whose capital stock shall have become impaired by losses or otherwise, shall, within three months after receiving notice thereof from the Comptroller of the Currency, pay the deficiency in the capital stock, by assessment upon the shareholders pro rata for the amount of capital stock held by each; and the Treasurer of the United States shall withhold the interest upon all bonds held by him in trust for any such association, upon notification from the Comptroller of the Currency, until otherwise notified by him. If any such association shall fail to pay up its capital stock, and shall refuse to go into liquidation, as provided by law, for three months after receiving notice from the comptroller, a receiver may be appointed to close up the business of the association, according to the provisions of
(R.S. §5205; June 30, 1876, ch. 156, §4,
Editorial Notes
Codification
R.S. §5205 derived from act Mar. 3, 1873, ch. 269, §1,
Statutory Notes and Related Subsidiaries
Application to District of Columbia
Provisions of this section were made applicable to banks, etc., in the District of Columbia by act Mar. 4, 1933, ch. 274, §4,
Executive Documents
Transfer of Functions
All functions of all officers of the Department of the Treasury, and all functions of all agencies and employees of such Department, were transferred, with certain exceptions, to the Secretary of the Treasury, with power vested in him to authorize their performance or the performance of any of his functions, by any of those officers, agencies, and employees, by 1950 Reorg. Plan No. 26, §§1, 2, eff. July 31, 1950, 15 F.R. 4935,
§56. Prohibition on withdrawal of capital; unearned dividends
No association, or any member thereof, shall, during the time it shall continue its banking operations, withdraw, or permit to be withdrawn, either in the form of dividends or otherwise, any portion of its capital. If losses have at any time been sustained by any such association, equal to or exceeding its undivided profits then on hand, no dividend shall be made; and no dividend shall ever be made by any association, while it continues its banking operations, to an amount greater than its undivided profits, subject to other applicable provisions of law. But nothing in this section shall prevent the reduction of the capital stock of the association under
(R.S. §5204;
Editorial Notes
Codification
R.S. §5204 derived from act June 3, 1864, ch. 106, §38,
Amendments
1994—
§57. Increase of capital by provision in articles of association
Any national banking association may, with the approval of the Comptroller of the Currency, and by a vote of shareholders owning two-thirds of the stock of such associations, increase its capital stock to any sum approved by the said comptroller, but no increase in capital shall be valid until the whole amount of such increase is paid in and notice thereof, duly acknowledged before a notary public by the president, vice president, or cashier of said association, has been transmitted to the Comptroller of the Currency and his certificate obtained specifying the amount of such increase in capital stock and his approval thereof, and that it has been duly paid in as part of the capital of such association: Provided, however, That a national banking association may, with the approval of the Comptroller of the Currency, and by the vote of shareholders owning two-thirds of the stock of such association, increase its capital stock by the declaration of a stock dividend, provided that the surplus of said association, after the approval of the increase, shall be at least equal to 20 per centum of the capital stock as increased. Such increase shall not be effective until a certificate certifying to such declaration of dividend, signed by the president, vice president, or cashier of said association and duly acknowledged before a notary public, shall have been forwarded to the Comptroller of the Currency and his certificate obtained specifying the amount of such increase of capital stock by stock dividend, and his approval thereof.
(R.S. §5142; Feb. 25, 1927, ch. 191, §5,
Editorial Notes
Codification
R.S. §5142 derived from act June 3, 1864, ch. 106, §13,
Amendments
1927—Act Feb. 25, 1927, among other changes, inserted proviso.
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§58. Repealed. Pub. L. 86–230, §6, Sept. 8, 1959, 73 Stat. 457
Section, act May 1, 1886, ch. 73, §1,
§59. Reduction of capital
(a) In general
Subject to the approval of the Comptroller of the Currency, a national banking association may, by a vote of shareholders owning, in the aggregate, two-thirds of its capital stock, reduce its capital.
(b) Shareholder distributions authorized
As part of its capital reduction plan approved in accordance with subsection (a), and with the affirmative vote of shareholders owning at least two thirds of the shares of each class of its stock outstanding (each voting as a class), a national banking association may distribute cash or other assets to its shareholders.
(R.S. §5143; Dec. 23, 1913, ch. 6, §28,
Editorial Notes
Codification
R.S. §5143 derived from act June 3, 1864, ch. 106, §13,
Amendments
2006—
1935—Act Aug. 23, 1935, substituted "and no shareholder shall be entitled to any distribution of cash or other assets by reason of any reduction of the common capital of any association unless such distribution shall have been approved by the Comptroller of the Currency and by the affirmative vote of at least two-thirds of the shares of each class of stock outstanding, voting as classes" for "and by the Federal Reserve Board or by the organization committee pending the organization of the Federal Reserve Board".
§60. National bank dividends
(a) In general
Subject to subsection (b), the directors of any national bank may declare a dividend of so much of the undivided profits of the bank as the directors judge to be expedient.
(b) Approval required under certain circumstances
A national bank may not declare and pay dividends in any year in excess of an amount equal to the sum of the total of the net income of the bank for that year and the retained net income of the bank for the preceding 2 years, minus the sum of any transfers required by the Comptroller of the Currency and any transfers required to be made to a fund for the retirement of any preferred stock, unless the Comptroller of the Currency approves the declaration and payment of dividends in excess of such amount.
(R.S. §5199; Aug. 23, 1935, ch. 614, title III, §315,
Editorial Notes
Codification
R.S. §5199 derived from act June 3, 1864, ch. 106, §33,
Amendments
2006—
1994—Subsec. (a).
Subsec. (b).
Subsec. (c).
1959—
1935—Act Aug. 23, 1935, among other changes, inserted proviso.
§61. Shareholders' voting rights; cumulative and distributive voting; preferred stock; trust shares; proxies, liability restrictions; percentage requirement exclusion of trust shares
In all elections of directors, each shareholder shall have the right to vote the number of shares owned by him for as many persons as there are directors to be elected, or, if so provided by the articles of association of the national bank, to cumulate such shares and give one candidate as many votes as the number of directors multiplied by the number of his shares shall equal or to distribute them on the same principle among as many candidates as he shall think fit; and in deciding all other questions at meetings of shareholders, each shareholder shall be entitled to one vote on each share of stock held by him; except that (1) this shall not be construed as limiting the voting rights of holders of preferred stock under the terms and provisions of articles of association, or amendments thereto, adopted pursuant to the provisions of
(R.S. §5144; June 16, 1933, ch. 89, §19,
Editorial Notes
Codification
R.S. §5144 derived from act June 3, 1864, ch. 106, §11,
Amendments
2006—
1966—
1959—Subsec. (c).
1954—Subsec. (d). Act Sept. 3, 1954, substituted "
1935—Act Aug. 23, 1935, amended first par., first sentence of third par., and inserted "and the provisions of this subsection, instead of subsection (b), shall apply to all holding company affiliates with respect to any shares of bank stock owned or controlled by them as to which there is no statutory liability imposed upon the holders of such bank stock" at end of subsec. (c).
1933—Act June 16, 1933, inserted provisions for cumulative voting of shares or distribution of votes on a cumulative voting principle, prohibited national banks holding their own shares as sole trustee from voting such shares but permitted such shares to be voted when held by another person or persons as trustees with the bank, denied voting rights to shares controlled by a holding company affiliate of a national bank unless a voting permit was first obtained, provided for application for a voting permit to the Federal Reserve Board, specified conditions for granting the voting permit and procedure for its revocation, and authorized the forfeiture of a National Bank's rights, privileges, and franchises upon such revocation.
§62. List of shareholders
The president and cashier of every national banking association shall cause to be kept at all times a full and correct list of the names and residences of all the shareholders in the association, and the number of shares held by each, in the office where its business is transacted. Such list shall be subject to the inspection of all the shareholders and creditors of the association, and the officers authorized to assess taxes under State authority, during business hours of each day in which business may be legally transacted. A copy of such list, verified by the oath of such president or cashier, shall be transmitted to the Comptroller of the Currency within ten days of any demand therefor made by him.
(R.S. §5210; May 18, 1953, ch. 59, §1,
Editorial Notes
Codification
R.S. §5210 derived from act June 3, 1864, ch. 106, §40,
Amendments
1953—Act May 18, 1953, changed the requirement for annual transmission of a copy of the shareholders list to the Comptroller of the Currency by authorizing the Comptroller to acquire such copy at any time on 10 days' notice.
Statutory Notes and Related Subsidiaries
Application to District of Columbia
Provisions of this section were made applicable to banks, etc., in the District of Columbia by act Mar. 4, 1933, ch. 274, §4,
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§§63, 64. Repealed. Pub. L. 86–230, §7, Sept. 8, 1959, 73 Stat. 457
Section 63, R.S. §5151, related to individual liability of shareholders.
Section 64, act Dec. 23, 1913, ch. 6, §23,
The status of former
§64a. Individual liability of shareholders; limitation on liability
The additional liability imposed upon shareholders in national banking associations by the provisions of
(June 16, 1933, ch. 89, §22,
Editorial Notes
References in Text
Amendments
1953—Act May 18, 1953, provided for termination of the additional liability, referred to in the section, by action of the Comptroller of the Currency with regard to those associations which had not, prior to May 18, 1953, caused notice of termination to be published.
1935—Act Aug. 23, 1935, added second and third sentences.
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
1 So in original. Probably should be "fails".
2 So in original. Probably should be "months".
§65. Repealed. Pub. L. 86–230, §8, Sept. 8, 1959, 73 Stat. 457
Section, acts June 30, 1876, ch. 156, §2,
§66. Personal liability of representatives of stockholders
Persons holding stock as executors, administrators, guardians, or trustees, shall not be personally subject to any liabilities as stockholders; but the estates and funds in their hands shall be liable in like manner and to the same extent as the testator, intestate, ward, or person interested in such trust funds would be, if living and competent to act and hold the stock in his own name.
(R.S. §5152.)
Editorial Notes
Codification
R.S. §5152 derived from act June 3, 1864, ch. 106, §63,
§67. Individual liability of shareholders; compromises; authority of receiver
Any receiver of a national banking association is authorized, with the approval of the Comptroller of the Currency and upon the order of a court of record of competent jurisdiction, to compromise, either before or after judgment, the individual liability of any shareholder of such association.
(Feb. 25, 1930, ch. 58,
Statutory Notes and Related Subsidiaries
Application to District of Columbia
Provisions of this section were made applicable to banks, etc., in the District of Columbia by act Mar. 4, 1933, ch. 274, §4,
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer to Secretary of the Treasury, see note set out under
SUBCHAPTER III—DIRECTORS
§71. Election
The affairs of each association shall be managed by not less than five directors, who shall be elected by the shareholders at a meeting to be held at any time before the association is authorized by the Comptroller of the Currency to commence the business of banking; and afterward at meetings to be held on such day of each year as is specified therefor in the bylaws. The directors shall hold office for a period of not more than 3 years, and until their successors are elected and have qualified. In accordance with regulations issued by the Comptroller of the Currency, a national bank may adopt bylaws that provide for staggering the terms of its directors.
(R.S. §5145;
Editorial Notes
Codification
R.S. §5145 derived from act June 3, 1864, ch. 106, §§9, 10,
Amendments
2000—
1963—
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§71a. Number of directors; penalties
After one year from June 16, 1933, notwithstanding any other provision of law, the board of directors, board of trustees, or other similar governing body of every national banking association and of every State bank or trust company which is a member of the Federal Reserve System shall consist of not less than five nor more than twenty-five members, except that the Comptroller of the Currency may, by regulation or order, exempt a national bank from the 25-member limit established by this section. If any national banking association violates the provisions of this section and continues such violation after thirty days' notice from the Comptroller of the Currency, the said Comptroller may appoint a receiver or conservator therefor, in accordance with the provisions of existing law. If any State bank or trust company which is a member of the Federal Reserve System violates the provisions of this section and continues such violation after thirty days' notice from the Board of Governors of the Federal Reserve System, it shall be subject to the forfeiture of its membership in the Federal Reserve System in accordance with the provisions of
(June 16, 1933, ch. 89, §31,
Editorial Notes
Amendments
2000—
1935—Act June 16, 1934, as amended by act Aug. 23, 1935, §306, repealed a former provision of this section relating to stock ownership requirements of directors, trustees, or members of similar governing bodies of any national banking association, or of any State bank or trust company which is a member of the Federal Reserve System.
1934—Act June 16, 1934, repealed a former provision of this section relating to stock ownership requirements of directors, trustees, or members of similar governing bodies of member banks of the Federal Reserve System.
Statutory Notes and Related Subsidiaries
Change of Name
Act Aug. 23, 1935, ch. 614, title II, §203(a),
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§72. Qualifications
Every director must, during his whole term of service, be a citizen of the United States, and at least a majority of the directors must have resided in the State, Territory, or District in which the association is located, or within one hundred miles of the location of the office of the association, for at least one year immediately preceding their election, and must be residents of such State or within one-hundred-mile territory of the location of the association during their continuance in office, except that the Comptroller may, in the discretion of the Comptroller, waive the requirement of residency, and waive the requirement of citizenship in the case of not more than a minority of the total number of directors. Every director must own in his or her own right either shares of the capital stock of the association of which he or she is a director the aggregate par value of which is not less than $1,000, or an equivalent interest, as determined by the Comptroller of the Currency, in any company which has control over such association within the meaning of
(R.S. §5146; Feb. 28, 1905, ch. 1163,
Editorial Notes
Codification
R.S. §5146 derived from act June 3, 1864, ch. 106, §§9, 10,
Amendments
2000—
1996—
1994—
1980—
1978—
1956—Act Apr. 27, 1956, substituted "two-thirds", "one hundred", "one-hundred-mile", for "three-fourths", "fifty", and "fifty-mile", respectively.
1927—Act Feb. 25, 1927, substituted a minimum value of stock ownership for minimum number of shares in both instances.
§73. Oath
Each director, when appointed or elected, shall take an oath that he will, so far as the duty devolves on him, diligently and honestly administer the affairs of such association, and will not knowingly violate or willingly permit to be violated any of the provisions of title 62 of the Revised Statutes, and that he is the owner in good faith, and in his own right, of the number of shares of stock required by title 62 of the Revised Statutes, subscribed by him, or standing in his name on the books of the association, and that the same is not hypothecated, or in any way pledged, as security for any loan or debt. The oath shall be taken before a notary public, properly authorized and commissioned by the State in which he resides, or before any other officer having an official seal and authorized by the State to administer oaths, except that the oath shall not be taken before any such notary public or other officer who is an officer of the director's bank. The oath, subscribed by the director making it, and certified by the notary public or other officer before whom it is taken, shall be immediately transmitted to the Comptroller of the Currency and shall be filed and preserved in his office for a period of ten years.
(R.S. §5147; Feb. 20, 1925, ch. 274,
Editorial Notes
References in Text
Title 62 of the Revised Statutes, referred to in text, was in the original "this Title" meaning title LXII of the Revised Statutes, consisting of R.S. §§5133 to 5244, which are classified to this section and
Codification
R.S. §5147 derived from act June 3, 1864, ch. 106, §9,
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§74. Vacancies
Any vacancy in the board shall be filled by appointment by the remaining directors, and any director so appointed shall hold his place until the next election.
(R.S. §5148.)
Editorial Notes
Codification
R.S. §5148 derived from act June 3, 1864, ch. 106, §10,
§75. Legal holiday, annual meeting on; proceedings where no election held on proper day
When the day fixed in the bylaws for the regular annual meeting of the shareholders falls on a legal holiday in the State in which the bank is located, the shareholders meeting shall be held, and the directors elected, on the next following banking day. If, from any cause, an election of directors is not made on the day fixed, or in the event of a legal holiday, on the next following banking day, an election may be held on any subsequent day within sixty days of the day fixed, to be designated by the board of directors, or, if the directors fail to fix the day, by shareholders representing two-thirds of the shares, at least ten days' notice thereof in all cases having been given by first-class mail to the shareholders.
(R.S. §5149;
Editorial Notes
Codification
R.S. §5149 derived from act June 3, 1864, ch. 106, §10,
Amendments
1963—
1959—
§76. President of bank as member of board; chairman of board
The president of the bank shall be a member of the board and shall be the chairman thereof, but the board may designate a director in lieu of the president to be chairman of the board, who shall perform such duties as may be designated by the board.
(R.S. §5150; Feb. 25, 1927, ch. 191, §6,
Editorial Notes
Codification
R.S. §5150 derived from act June 3, 1864, ch. 106, §9,
Amendments
1927—Act Feb. 25, 1927, amended section generally. Prior to amendment, section read as follows: "One of the directors, to be chosen by the board, shall be president of the board."
§77. Repealed. Pub. L. 89–695, title II, §207, Oct. 16, 1966, 80 Stat. 1055
Section, act June 16, 1933, ch. 89, §30,
Editorial Notes
Codification
Section 401 of
Statutory Notes and Related Subsidiaries
Conditions Governing Employment of Personnel Not Repealed, Modified, or Affected
Nothing contained in section 207 of
§78. Repealed. Pub. L. 106–102, title I, §101(b), Nov. 12, 1999, 113 Stat. 1341
Section, acts June 16, 1933, ch. 89, §32,
Statutory Notes and Related Subsidiaries
Effective Date of Repeal
Repeal effective 120 days after Nov. 12, 1999, see section 161 of
SUBCHAPTER IV—REGULATION OF THE BANKING BUSINESS; POWERS AND DUTIES OF NATIONAL BANKS
§81. Place of business
The general business of each national banking association shall be transacted in the place specified in its organization certificate and in the branch or branches, if any, established or maintained by it in accordance with the provisions of
(R.S. §5190; Feb. 25, 1927, ch. 191, §8,
Editorial Notes
Codification
R.S. §5190 derived from act June 3, 1864, ch. 106, §8,
Amendments
1927—Act Feb. 25, 1927, among other changes, inserted "and in the branch or branches, if any, established or maintained by it in accordance with the provisions of
§82. Repealed. Pub. L. 97–320, title IV, §402, Oct. 15, 1982, 96 Stat. 1510
Section, R.S. §5202; Dec. 23, 1913, ch. 6, §13 (par.),
§83. Loans by bank on its own stock
(a) General prohibition
No national bank shall make any loan or discount on the security of the shares of its own capital stock.
(b) Exclusion
For purposes of this section, a national bank shall not be deemed to be making a loan or discount on the security of the shares of its own capital stock if it acquires the stock to prevent loss upon a debt previously contracted for in good faith.
(R.S. §5201;
Editorial Notes
Codification
R.S. §5201 derived from act June 3, 1864, ch. 106, §35,
Amendments
2000—
§84. Lending limits
(a) Total loans and extensions of credit
(1) The total loans and extensions of credit by a national banking association to a person outstanding at one time and not fully secured, as determined in a manner consistent with paragraph (2) of this subsection, by collateral having a market value at least equal to the amount of the loan or extension of credit shall not exceed 15 per centum of the unimpaired capital and unimpaired surplus of the association.
(2) The total loans and extensions of credit by a national banking association to a person outstanding at one time and fully secured by readily marketable collateral having a market value, as determined by reliable and continuously available price quotations, at least equal to the amount of the funds outstanding shall not exceed 10 per centum of the unimpaired capital and unimpaired surplus of the association. This limitation shall be separate from and in addition to the limitation contained in paragraph (1) of this subsection.
(b) Definitions
For the purposes of this section—
(1) the term "loans and extensions of credit" shall include—
(A) all direct or indirect advances of funds to a person made on the basis of any obligation of that person to repay the funds or repayable from specific property pledged by or on behalf of the person;
(B) to the extent specified by the Comptroller of the Currency, any liability of a national banking association to advance funds to or on behalf of a person pursuant to a contractual commitment; and
(C) any credit exposure to a person arising from a derivative transaction, repurchase agreement, reverse repurchase agreement, securities lending transaction, or securities borrowing transaction between the national banking association and the person;
(2) the term "person" shall include an individual, sole proprietorship, partnership, joint venture, association, trust, estate, business trust, corporation, sovereign government or agency, instrumentality, or political subdivision thereof, or any similar entity or organization; and
(3) the term "derivative transaction" includes any transaction that is a contract, agreement, swap, warrant, note, or option that is based, in whole or in part, on the value of, any interest in, or any quantitative measure or the occurrence of any event relating to, one or more commodities, securities, currencies, interest or other rates, indices, or other assets.
(c) Exceptions
The limitations contained in subsection (a) shall be subject to the following exceptions:
(1) Loans or extensions of credit arising from the discount of commercial or business paper evidencing an obligation to the person negotiating it with recourse shall not be subject to any limitation based on capital and surplus.
(2) The purchase of bankers' acceptances of the kind described in
(3) Loans and extensions of credit secured by bills of lading, warehouse receipts, or similar documents transferring or securing title to readily marketable staples shall be subject to a limitation of 35 per centum of capital and surplus in addition to the general limitations if the market value of the staples securing each additional loan or extension of credit at all times equals or exceeds 115 per centum of the outstanding amount of such loan or extension of credit. The staples shall be fully covered by insurance whenever it is customary to insure such staples.
(4) Loans or extensions of credit secured by bonds, notes, certificates of indebtedness, or Treasury bills of the United States or by other such obligations fully guaranteed as to principal and interest by the United States shall not be subject to any limitation based on capital and surplus.
(5) Loans or extensions of credit to or secured by unconditional takeout commitments or guarantees of any department, agency, bureau, board, commission, or establishment of the United States or any corporation wholly owned directly or indirectly by the United States shall not be subject to any limitation based on capital and surplus.
(6) Loans or extensions of credit secured by a segregated deposit account in the lending bank shall not be subject to any limitation based on capital and surplus.
(7) Loans or extensions of credit to any financial institution or to any receiver, conservator, superintendent of banks, or other agent in charge of the business and property of such financial institution, when such loans or extensions of credit are approved by the Comptroller of the Currency, shall not be subject to any limitation based on capital and surplus.
(8)(A) Loans and extensions of credit arising from the discount of negotiable or nonnegotiable installment consumer paper which carries a full recourse endorsement or unconditional guarantee by the person transferring the paper shall be subject under this section to a maximum limitation equal to 25 per centum of such capital and surplus, notwithstanding the collateral requirements set forth in subsection (a)(2).
(B) If the bank's files or the knowledge of its officers of the financial condition of each maker of such consumer paper is reasonably adequate, and an officer of the bank designated for that purpose by the board of directors of the bank certifies in writing that the bank is relying primarily upon the responsibility of each maker for payment of such loans or extensions of credit and not upon any full or partial recourse endorsement or guarantee by the transferor, the limitations of this section as to the loans or extensions of credit of each such maker shall be the sole applicable loan limitations.
(9)(A) Loans and extensions of credit secured by shipping documents or instruments transferring or securing title covering livestock or giving a lien on livestock when the market value of the livestock securing the obligation is not at any time less than 115 per centum of the face amount of the note covered, shall be subject under this section, notwithstanding the collateral requirements set forth in subsection (a)(2), to a maximum limitation equal to 25 per centum of such capital and surplus.
(B) Loans and extensions of credit which arise from the discount by dealers in dairy cattle of paper given in payment for dairy cattle, which paper carries a full recourse endorsement or unconditional guarantee of the seller, and which are secured by the cattle being sold, shall be subject under this section, notwithstanding the collateral requirements set forth in subsection (a)(2), to a limitation of 25 per centum of such capital and surplus.
(10) Loans or extensions of credit to the Student Loan Marketing Association shall not be subject to any limitation based on capital and surplus.
(d) Authority of Comptroller of the Currency
(1) The Comptroller of the Currency may prescribe rules and regulations to administer and carry out the purposes of this section, including rules or regulations to define or further define terms used in this section and to establish limits or requirements other than those specified in this section for particular classes or categories of loans or extensions of credit.
(2) The Comptroller of the Currency also shall have authority to determine when a loan putatively made to a person shall for purposes of this section be attributed to another person.
(R.S. §5200; June 22, 1906, ch. 3516,
Editorial Notes
References in Text
Codification
R.S. §5200 derived from act June 3, 1864, ch. 106, §29,
Amendments
2020—Subsec. (c)(7).
Subsec. (d)(1).
2010—Subsec. (b)(1).
Subsec. (b)(3).
1983—Subsec. (b)(1).
1982—
"(1) Obligations in the form of drafts or bills of exchange drawn in good faith against actually existing values shall not be subject under this section to any limitation based upon such capital and surplus.
"(2) Obligations arising out of the discount of commercial or business paper actually owned by the person, copartnership, association, or corporation negotiating the same shall not be subject under this section to any limitation based upon such capital and surplus.
"(3) Obligations drawn in good faith against actually existing values and secured by goods or commodities in process of shipment shall not be subject under this section to any limitation based upon such capital and surplus.
"(4) Obligations as indorser or guarantor of notes, other than commercial or business paper excepted under paragraph (2) of this section, having a maturity of not more than six months, and owned by the person, corporation, association, or copartnership indorsing and negotiating the same, shall be subject under this section to a limitation of 15 per centum of such capital and surplus in addition to such 10 per centum of such capital and surplus.
"(5) Obligations in the form of banker's acceptances of other banks of the kind described in
"(6) Obligations of any person, copartnership, association or corporation, in the form of notes or drafts secured by shipping documents, warehouse receipts or other such documents transferring or securing title covering readily marketable nonperishable staples when such property is fully covered by insurance, if it is customary to insure such staples, shall be subject under this section to a limitation of 15 per centum of such capital and surplus in addition to such 10 per centum of such capital and surplus when the market value of such staples securing such obligation is not at any time less than 115 per centum of the face amount of such obligation, and to an additional increase of limitation of 5 per centum of such capital and surplus in addition to such 25 per centum of such capital and surplus when the market value of such staples securing such additional obligation is not at any time less than 120 per centum of the face amount of such additional obligation, and to a further additional increase of limitation of 5 per centum of such capital and surplus in addition to such 30 per centum of such capital and surplus when the market value of such staples securing such additional obligation is not at any time less than 125 per centum of the face amount of such additional obligation, and to a further additional increase of limitation of 5 per centum of such capital and surplus in addition to such 35 per centum of such capital and surplus when the market value of such staples securing such additional obligation is not at any time less than 130 per centum of the face amount of such additional obligation, and to a further additional increase of limitation of 5 per centum of such capital and surplus in addition to such 40 per centum of such capital and surplus when the market value of such staples securing such additional obligation is not at any time less than 135 per centum of the face amount of such additional obligation, and to a further additional increase of limitation of 5 per centum of such capital and surplus in addition to such 45 per centum of such capital and surplus when the market value of such staples securing such additional obligation is not at any time less than 140 per centum of the face amount of such additional obligation, but this exception shall not apply to obligations of any one person, copartnership, association, or corporation arising from the same transactions and/or secured by the identical staples for more than ten months. Obligations of any person, copartnership, association, or corporation in the form of notes or drafts secured by shipping documents, warehouse receipts, or other such documents transferring or securing title covering refrigerated or frozen readily marketable staples when such property is fully covered by insurance, shall be subject under this section to a limitation of 15 per centum of such capital and surplus in addition to such 10 per centum of such capital and surplus when the market value of such staples securing such obligation is not at any time less than 115 per centum of the face amount of such additional obligation, but this exception shall not apply to obligations of any one person, copartnership, association or corporation arising from the same transactions and/or secured by the identical staples for more than six months.
"(7) Obligations of any person, copartnership, association, or corporation in the form of notes or drafts secured by shipping documents or instruments transferring or securing title covering livestock or giving a lien on livestock when the market value of the livestock securing the obligation is not at any time less than 115 per centum of the face amount of the notes covered by such documents shall be subject under this section to a limitation of 15 per centum of such capital and surplus in addition to such 10 per centum of such capital and surplus. Obligations arising out of the discount by dealers in dairy cattle of paper given in payment for dairy cattle, which bear a full recourse endorsement or unconditional guarantee of the seller and are secured by the cattle being sold, shall be subject under this section to a limitation of 15 per centum of such capital and surplus in addition to such 10 per centum of such capital and surplus.
"(8) Obligations of any person, copartnership, association, or corporation secured by not less than a like amount of bonds or notes of the United States issued since April 24, 1917, or certificates of indebtedness of the United States, Treasury bills of the United States, or obligations fully guaranteed both as to principal and interest by the United States, shall (except to the extent permitted by rules and regulations prescribed by the Comptroller of the Currency, with the approval of the Secretary of the Treasury) be subject under this section to a limitation of 15 per centum of such capital and surplus in addition to such 10 per centum of such capital and surplus.
"(9) Obligations representing loans to any national banking association or to any banking institution organized under the laws of any State, or to any receiver, conservator, or superintendent of banks, or to any other agent, in charge of the business and property of any such association or banking institution, when such loans are approved by the Comptroller of the Currency, shall not be subject under this section to any limitation based upon such capital and surplus.
"(10) Obligations shall not be subject under this section to any limitation based upon such capital and surplus to the extent that such obligations are secured or covered by guaranties, or by commitments or agreements to take over or to purchase, made by any Federal Reserve bank or by the United States or any department, bureau, board, commission, or establishment of the United States, including any corporation wholly owned directly or indirectly by the United States: Provided, That such guaranties, agreements, or commitments are unconditional and must be performed by payment of cash or its equivalent within sixty days after demand. The Comptroller of the Currency is authorized to define the terms herein used if and when he may deem it necessary.
"(11) Obligations of a local public agency (as defined in section 110(h) of the Housing Act of 1949 [
"(12) Obligations insured by the Secretary of Agriculture pursuant to the Bankhead-Jones Farm Tenant Act, as amended [
"(13) Obligations as endorser or guarantor of negotiable or nonnegotiable installment consumer paper which carries a full recourse endorsement or unconditional guarantee by the person, copartnership, association, or corporation transferring the same, shall be subject under this section to a limitation of 15 per centum of such capital and surplus in addition to such 10 per centum of such capital and surplus: Provided, however, That if the bank's files or the knowledge of its officers of the financial condition of each maker of such obligations is reasonably adequate, and upon certification by an officer of the bank designated for that purpose by the board of directors of the bank, that the responsibility of each maker of such obligations has been evaluated and the bank is relying primarily upon each such maker for the payment of such obligations, the limitations of this section as to the obligations of each such maker shall be the sole applicable loan limitation: Provided further, That such certification shall be in writing and shall be retained as part of the records of such bank.
"(14) Obligations of the Student Loan Marketing Association shall not be subject to any limitation based upon such capital and surplus."
1972—Par. (14).
1967—Par. (11).
1962—Par. (12).
1959—Par. (6).
Par. (7).
Par. (8).
Par. (13).
1958—Par. (12).
1949—Par. (11). Act July 15, 1949, added par. (11).
1942—Par. (10). Act June 11, 1942, added par. (10).
1935—Par. (8). Act Aug. 23, 1935, inserted "Treasury bills of the United States, or obligations fully guaranteed both as to principal and interest by the United States".
1933—Par. (1). Act June 16, 1933, inserted provision relating to obligations of a corporation and its subsidiaries in second sentence.
Par. (9). Act May 20, 1933, added par. (9).
1927—Act Feb. 25, 1927, reenacted section, subdividing it into eight numbered exceptions.
Statutory Notes and Related Subsidiaries
Effective and Termination Dates of 2020 Amendment
"(1) the termination date of the national emergency concerning the novel coronavirus disease (COVID–19) outbreak declared by the President on March 13, 2020 under the National Emergencies Act (
"(2) December 31, 2020."
Effective Date of 2010 Amendment
[For definition of "transfer date" as used in section 610(c) of
Effective Date of 1982 Amendment
Repeals
Repealing provisions of Consolidated Farmers Home Administration Act of 1961 as not having the effect of repealing the amendment to this section enacted by act July 22, 1937, §15(a), as added Aug. 14, 1946, see section 341(a) of
Savings Provision
Act June 16, 1933, ch. 89, §26(b),
Application to District of Columbia
Provisions of this section were made applicable to banks, etc., in the District of Columbia by act Mar. 4, 1933, ch. 274, §3,
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§85. Rate of interest on loans, discounts and purchases
Any association may take, receive, reserve, and charge on any loan or discount made, or upon any notes, bills of exchange, or other evidences of debt, interest at the rate allowed by the laws of the State, Territory, or District where the bank is located, or at a rate of 1 per centum in excess of the discount rate on ninety-day commercial paper in effect at the Federal reserve bank in the Federal reserve district where the bank is located, whichever may be the greater, and no more, except that where by the laws of any State a different rate is limited for banks organized under State laws, the rate so limited shall be allowed for associations organized or existing in any such State under title 62 of the Revised Statutes. When no rate is fixed by the laws of the State, or Territory, or District, the bank may take, receive, reserve, or charge a rate not exceeding 7 per centum, or 1 per centum in excess of the discount rate on ninety day commercial paper in effect at the Federal reserve bank in the Federal reserve district where the bank is located, whichever may be the greater, and such interest may be taken in advance, reckoning the days for which the note, bill, or other evidence of debt has to run. The maximum amount of interest or discount to be charged at a branch of an association located outside of the States of the United States and the District of Columbia shall be at the rate allowed by the laws of the country, territory, dependency, province, dominion, insular possession, or other political subdivision where the branch is located. And the purchase, discount, or sale of a bona fide bill of exchange, payable at another place than the place of such purchase, discount, or sale, at not more than the current rate of exchange for sight drafts in addition to the interest, shall not be considered as taking or receiving a greater rate of interest.
(R.S. §5197; June 16, 1933, ch. 89, §25,
Editorial Notes
References in Text
Title 62 of the Revised Statutes, referred to in text, was in the original "this Title" meaning title LXII of the Revised Statutes, consisting of R.S. §§5133 to 5244, which are classified to this section and
Codification
R.S. §5197 derived from act June 3, 1864, ch. 106, §30,
Section 201 of
Section 101 of
Section 201 of
Amendments
1980—
1979—
1974—
1935—Act Aug. 23, 1935, inserted third sentence.
1933—Act June 16, 1933, authorized interest at the alternative rate of 1 per centum in excess of the discount rate on ninety-day commercial paper in effect at the federal reserve bank in the Federal reserve district where the bank is located if greater.
Statutory Notes and Related Subsidiaries
Effective Date of 1980 Amendment
Effective Date of 1979 Amendments
Effective and Termination Dates of 1974 Amendment
Savings Provisions
Choice of Highest Applicable Interest Rate
In any case in which one or more provisions of, or amendments made by, title V of
States Having Constitutional Provisions Regarding Maximum Interest Rates
§86. Usurious interest; penalty for taking; limitations
The taking, receiving, reserving, or charging a rate of interest greater than is allowed by
(R.S. §5198.)
Editorial Notes
Codification
R.S. §5198 (less last sentence) derived from act June 3, 1864, ch. 106, §30,
Section is based on R.S. §5198, less last sentence as added by act Feb. 18, 1875, ch. 80, §1,
§86a. Omitted
Editorial Notes
Codification
Section,
A prior section 86a,
Another prior section 86a,
Section 301 of
§§87 to 89. Repealed. Pub. L. 103–325, title VI, §602(e)(2)–(4), Sept. 23, 1994, 108 Stat. 2291
Section 87, R.S. §5203, related to restriction on use by bank of its circulating notes.
Section 88, R.S. §5206, related to restriction on use by bank of notes of other banks.
Section 89, R.S. §5196, related to duty of bank to receive circulating notes of other banks in payment of debts.
§90. Depositaries of public moneys and financial agents of Government
All national banking associations, designated for that purpose by the Secretary of the Treasury, shall be depositaries of public money, under such regulations as may be prescribed by the Secretary; and they may also be employed as financial agents of the Government; and they shall perform all such reasonable duties, as depositaries of public money and financial agents of the Government, as may be required of them. The Secretary of the Treasury shall require the associations thus designated to give satisfactory security, by the deposit of United States bonds and otherwise, for the safe-keeping and prompt payment of the public money deposited with them, and for the faithful performance of their duties as financial agents of the Government: Provided, That the Secretary shall, on or before the 1st of January of each year, make a public statement of the securities required during that year for such deposits. And every association so designated as receiver or depositary of the public money shall take and receive at par all of the national currency bills, by whatever association issued, which have been paid into the Government for internal revenue, or for loans or stocks: Provided, That the Secretary of the Treasury shall distribute the deposits herein provided for, as far as practicable, equitably between the different States and sections.
Any national banking association may, upon the deposit with it of any funds by any State or political subdivision thereof or any agency or other governmental instrumentality of one or more States or political subdivisions thereof, including any officer, employee, or agent thereof in his official capacity, give security for the safekeeping and prompt payment of the funds so deposited to the same extent and of the same kind as is authorized by the law of the State in which such association is located in the case of other banking institutions in the State.
Any national banking association may, upon the deposit with it of any funds by any federally recognized Indian tribe, or any officer, employee, or agent thereof in his or her official capacity, give security for the safekeeping and prompt payment of the funds so deposited by the deposit of United States bonds and otherwise as may be prescribed by the Secretary of the Treasury for public funds under the first paragraph of this section.
Notwithstanding chapters 1 to 11 of title 40 and division C (except sections 3302, 3307(e), 3501(b), 3509, 3906, 4710, and 4711) of subtitle I of title 41, the Secretary may select associations as financial agents in accordance with any process the Secretary deems appropriate and their reasonable duties may include the provision of electronic benefit transfer services (including State-administered benefits with the consent of the States), as defined by the Secretary.
(R.S. §5153; Mar. 3, 1901, ch. 871,
Editorial Notes
Codification
In text, "chapters 1 to 11 of title 40 and division C (except sections 3302, 3307(e), 3501(b), 3509, 3906, 4710, and 4711) of subtitle I of title 41" substituted for "the Federal Property and Administrative Services Act of 1949, as amended" on authority of
R.S. §5153 derived from act June 3, 1864, ch. 106, §45,
Amendments
1996—
1979—
1950—Act Aug. 18, 1950, permitted national banks to accept and give security for deposits of funds made by agencies or governmental instrumentalities or States or political subdivisions thereof and by their officers, employees or agents.
1930—Act June 25, 1930, added second par.
§91. Transfers by bank and other acts in contemplation of insolvency
All transfers of the notes, bonds, bills of exchange, or other evidences of debt owing to any national banking association, or of deposits to its credit; all assignments of mortgages, sureties on real estate, or of judgments or decrees in its favor; all deposits of money, bullion, or other valuable thing for its use, or for the use of any of its shareholders or creditors; and all payments of money to either, made after the commission of an act of insolvency, or in contemplation thereof, made with a view to prevent the application of its assets in the manner prescribed by
(R.S. §5242.)
Editorial Notes
References in Text
Codification
R.S. §5242 derived from act June 3, 1864, ch. 106, §52,
§92. Acting as insurance agent or broker
In addition to the powers now vested by law in national banking associations organized under the laws of the United States any such association located and doing business in any place the population of which does not exceed five thousand inhabitants, as shown by the last preceding decennial census, may, under such rules and regulations as may be prescribed by the Comptroller of the Currency, act as the agent for any fire, life, or other insurance company authorized by the authorities of the State in which said bank is located to do business in said State, by soliciting and selling insurance and collecting premiums on policies issued by such company; and may receive for services so rendered such fees or commissions as may be agreed upon between the said association and the insurance company for which it may act as agent: Provided, however, That no such bank shall in any case assume or guarantee the payment of any premium on insurance policies issued through its agency by its principal: And provided further, That the bank shall not guarantee the truth of any statement made by an assured in filing his application for insurance.
(Dec. 23, 1913, ch. 6, §13 (par.), as added Sept. 7, 1916, ch. 461,
Editorial Notes
Codification
Section is based on the eleventh par. of section 13 of act Dec. 23, 1913, as amended. The eleventh par. constituted the ninth par. of section 13 in 1916 (
For decision by U.S. Supreme Court that, despite faulty placement of quotation marks, act Sept. 7, 1916, placed within section 13 of act Dec. 23, 1913, each of the ten pars. located between the phrases that introduced the amendments to sections 13 and 14 of said act, that only the seventh par. (rather than seventh to tenth pars.) comprised the amended R.S. §5202, and that section 20 of act Apr. 5, 1918 (
Amendments
1982—
Statutory Notes and Related Subsidiaries
Effective Date of 1982 Amendment
Amendment by
Moratorium
§92a. Trust powers
(a) Authority of Comptroller of the Currency
The Comptroller of the Currency shall be authorized and empowered to grant by special permit to national banks applying therefor, when not in contravention of State or local law, the right to act as trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, receiver, or in any other fiduciary capacity in which State banks, trust companies, or other corporations which come into competition with national banks are permitted to act under the laws of the State in which the national bank is located.
(b) Grant and exercise of powers deemed not in contravention of State or local law
Whenever the laws of such State authorize or permit the exercise of any or all of the foregoing powers by State banks, trust companies, or other corporations which compete with national banks, the granting to and the exercise of such powers by national banks shall not be deemed to be in contravention of State or local law within the meaning of this section.
(c) Segregation of fiduciary and general assets; separate books and records; access of State banking authorities to reports of examinations, books, records, and assets
National banks exercising any or all of the powers enumerating 1 in this section shall segregate all assets held in any fiduciary capacity from the general assets of the bank and shall keep a separate set of books and records showing in proper detail all transactions engaged in under authority of this section. The State banking authorities may have access to reports of examination made by the Comptroller of the Currency insofar as such reports relate to the trust department of such bank, but nothing in this section shall be construed as authorizing the State banking authorities to examine the books, records, and assets of such bank.
(d) Prohibited operations; separate investment account; collateral for certain funds used in conduct of business
No national bank shall receive in its trust department deposits of current funds subject to check or the deposit of checks, drafts, bills of exchange, or other items for collection or exchange purposes. Funds deposited or held in trust by the bank awaiting investment shall be carried in a separate account and shall not be used by the bank in the conduct of its business unless it shall first set aside in the trust department United States bonds or other securities approved by the Comptroller of the Currency.
(e) Lien and claim upon bank failure
In the event of the failure of such bank the owners of the funds held in trust for investment shall have a lien on the bonds or other securities so set apart in addition to their claim against the estate of the bank.
(f) Deposits of securities for protection of private or court trusts; execution of and exemption from bond
Whenever the laws of a State require corporations acting in a fiduciary capacity to deposit securities with the State authorities for the protection of private or court trusts, national banks so acting shall be required to make similar deposits and securities so deposited shall be held for the protection of private or court trusts, as provided by the State law. National banks in such cases shall not be required to execute the bond usually required of individuals if State corporations under similar circumstances are exempt from this requirement. National banks shall have power to execute such bond when so required by the laws of the State.
(g) Officials' oath or affidavit
In any case in which the laws of a State require that a corporation acting as trustee, executor, administrator, or in any capacity specified in this section, shall take an oath or make an affidavit, the president, vice president, cashier, or trust officer of such national bank may take the necessary oath or execute the necessary affidavit.
(h) Loans of trust funds to officers and employees prohibited; penalties
It shall be unlawful for any national banking association to lend any officer, director, or employee any funds held in trust under the powers conferred by this section. Any officer, director, or employee making such loan, or to whom such loan is made, may be fined not more than $5,000, or imprisoned not more than five years, or may be both fined and imprisoned, in the discretion of the court.
(i) Considerations determinative of grant or denial of applications; minimum capital and surplus for issuance of permit
In passing upon applications for permission to exercise the powers enumerated in this section, the Comptroller of the Currency may take into consideration the amount of capital and surplus of the applying bank, whether or not such capital and surplus is sufficient under the circumstances of the case, the needs of the community to be served, and any other facts and circumstances that seem to him proper, and may grant or refuse the application accordingly: Provided, That no permit shall be issued to any national banking association having a capital and surplus less than the capital and surplus required by State law of State banks, trust companies, and corporations exercising such powers.
(j) Surrender of authorization; board resolution; Comptroller certification; activities affected; regulations
Any national banking association desiring to surrender its right to exercise the powers granted under this section, in order to relieve itself of the necessity of complying with the requirements of this section, or to have returned to it any securities which it may have deposited with the State authorities for the protection of private or court trusts, or for any other purpose, may file with the Comptroller of the Currency a certified copy of a resolution of its board of directors signifying such desire. Upon receipt of such resolution, the Comptroller of the Currency, after satisfying himself that such bank has been relieved in accordance with State law of all duties as trustee, executory,2 administrator, registrar of stocks and bonds, guardian of estates, assignee, receiver, or other fiduciary, under court, private, or other appointments previously accepted under authority of this section, may, in his discretion, issue to such bank a certificate certifying that such bank is no longer authorized to exercise the powers granted by this section. Upon the issuance of such a certificate by the Comptroller of the Currency, such bank (1) shall no longer be subject to the provisions of this section or the regulations of the Comptroller of the Currency made pursuant thereto, (2) shall be entitled to have returned to it any securities which it may have deposited with the State authorities for the protection of private or court trusts, and (3) shall not exercise thereafter any of the powers granted by this section without first applying for and obtaining a new permit to exercise such powers pursuant to the provisions of this section. The Comptroller of the Currency is authorized and empowered to promulgate such regulations as he may deem necessary to enforce compliance with the provisions of this section and the proper exercise of the powers granted therein.
(k) Revocation; procedures applicable
(1) In addition to the authority conferred by other law, if, in the opinion of the Comptroller of the Currency, a national banking association is unlawfully or unsoundly exercising, or has unlawfully or unsoundly exercised, or has failed for a period of five consecutive years to exercise, the powers granted by this section or otherwise fails or has failed to comply with the requirements of this section, the Comptroller may issue and serve upon the association a notice of intent to revoke the authority of the association to exercise the powers granted by this section. The notice shall contain a statement of the facts constituting the alleged unlawful or unsound exercise of powers, or failure to exercise powers, or failure to comply, and shall fix a time and place at which a hearing will be held to determine whether an order revoking authority to exercise such powers should issue against the association.
(2) Such hearing shall be conducted in accordance with the provisions of
(3) Unless the association so served shall appear at the hearing by a duly authorized representative, it shall be deemed to have consented to the issuance of the revocation order. In the event of such consent, or if upon the record made at any such hearing, the Comptroller shall find that any allegation specified in the notice of charges has been established, the Comptroller may issue and serve upon the association an order prohibiting it from accepting any new or additional trust accounts and revoking authority to exercise any and all powers granted by this section, except that such order shall permit the association to continue to service all previously accepted trust accounts pending their expeditious divestiture or termination.
(4) A revocation order shall become effective not earlier than the expiration of thirty days after service of such order upon the association so served (except in the case of a revocation order issued upon consent, which shall become effective at the time specified therein), and shall remain effective and enforceable, except to such extent as it is stayed, modified, terminated, or set aside by action of the Comptroller or a reviewing court.
(
Editorial Notes
Amendments
2012—Subsec. (a).
Subsec. (j).
1980—Subsec. (k).
Statutory Notes and Related Subsidiaries
Savings Provision
1 So in original. Probably should be "enumerated".
2 So in original. Probably should be "executor,".
§93. Violation of provisions of chapter
(a) Forfeiture of franchise; personal liability of directors
If the directors of any national banking association shall knowingly violate, or knowingly permit any of the officers, agents, or servants of the association to violate any of the provisions of title 62 of the Revised Statutes, all the rights, privileges, and franchises of the association shall be thereby forfeited. Such violation shall, however, be determined and adjudged by a proper district or Territorial court of the United States in a suit brought for that purpose by the Comptroller of the Currency, in his own name, before the association shall be declared dissolved. And in cases of such violation, every director who participated in or assented to the same shall be held liable in his personal and individual capacity for all damages which the association, its shareholders, or any other person, shall have sustained in consequence of such violation.
(b) Civil money penalty
(1) First tier
Any national banking association which, and any institution-affiliated party (within the meaning of
(2) Second tier
Notwithstanding paragraph (1), any national banking association which, and any institution-affiliated party (within the meaning of
(A)(i) commits any violation described in any 2 paragraph (1);
(ii) recklessly engages in an unsafe or unsound practice in conducting the affairs of such association; or
(iii) breaches any fiduciary duty;
(B) which violation, practice, or breach—
(i) is part of a pattern of misconduct;
(ii) causes or is likely to cause more than a minimal loss to such association; or
(iii) results in pecuniary gain or other benefit to such party,
shall forfeit and pay a civil penalty of not more than $25,000 for each day during which such violation, practice, or breach continues.
(3) Third tier
Notwithstanding paragraphs (1) and (2), any national banking association which, and any institution-affiliated party (within the meaning of
(A) knowingly—
(i) commits any violation described in paragraph (1);
(ii) engages in any unsafe or unsound practice in conducting the affairs of such association; or
(iii) breaches any fiduciary duty; and
(B) knowingly or recklessly causes a substantial loss to such association or a substantial pecuniary gain or other benefit to such party by reason of such violation, practice, or breach,
shall forfeit and pay a civil penalty in an amount not to exceed the applicable maximum amount determined under paragraph (4) for each day during which such violation, practice, or breach continues.
(4) Maximum amounts of penalties for any violation described in paragraph (3)
The maximum daily amount of any civil penalty which may be assessed pursuant to paragraph (3) for any violation, practice, or breach described in such paragraph is—
(A) in the case of any person other than a national banking association, an amount to not 3 exceed $1,000,000; and
(B) in the case of a national banking association, an amount not to exceed the lesser of—
(i) $1,000,000; or
(ii) 1 percent of the total assets of such association.
(5) Assessment; etc.
Any penalty imposed under paragraph (1), (2), or (3) shall be assessed and collected by the Comptroller of the Currency in the manner provided in subparagraphs (E), (F), (G), and (I) of
(6) Hearing
The association or other person against whom any penalty is assessed under this subsection shall be afforded an agency hearing if such association or person submits a request for such hearing within 20 days after the issuance of the notice of assessment.
(7) Disbursement
All penalties collected under authority of this subsection shall be deposited into the Treasury.
(8) "Violate" defined
For purposes of this section, the term "violate" includes any action (alone or with another or others) for or toward causing, bringing about, participating in, counseling, or aiding or abetting a violation.
(12) 4 Regulations
The Comptroller shall prescribe regulations establishing such procedures as may be necessary to carry out this subsection.
(c) Notice under this section after separation from service
The resignation, termination of employment or participation, or separation of an institution-affiliated party (within the meaning of
(d) Forfeiture of franchise for money laundering or cash transaction reporting offenses
(1) In general
(A) Conviction of title 18 offenses
(i) Duty to notify
If a national bank, a Federal branch, or Federal agency has been convicted of any criminal offense under
(ii) Notice of termination; pretermination hearing
After receiving written notification from the Attorney General of such a conviction, the Comptroller of the Currency shall issue to the national bank, Federal branch, or Federal agency a notice of the Comptroller's intention to terminate all rights, privileges, and franchises of the bank, Federal branch, or Federal agency and schedule a pretermination hearing.
(B) Conviction of title 31 offenses
If a national bank, a Federal branch, or a Federal agency is convicted of any criminal offense under
(C) Judicial review
(2) Factors to be considered
In determining whether a franchise shall be forfeited under paragraph (1), the Comptroller of the Currency shall take into account the following factors:
(A) The extent to which directors or senior executive officers of the national bank, Federal branch, or Federal agency knew of, or were involved in, the commission of the money laundering offense of which the bank, Federal branch, or Federal agency was found guilty.
(B) The extent to which the offense occurred despite the existence of policies and procedures within the national bank, Federal branch, or Federal agency which were designed to prevent the occurrence of any such offense.
(C) The extent to which the national bank, Federal branch, or Federal agency has fully cooperated with law enforcement authorities with respect to the investigation of the money laundering offense of which the bank, Federal branch, or Federal agency was found guilty.
(D) The extent to which the national bank, Federal branch, or Federal agency has implemented additional internal controls (since the commission of the offense of which the bank, Federal branch, or Federal agency was found guilty) to prevent the occurrence of any other money laundering offense.
(E) The extent to which the interest of the local community in having adequate deposit and credit services available would be threatened by the forfeiture of the franchise.
(3) Successor liability
This subsection shall not apply to a successor to the interests of, or a person who acquires, a bank, a Federal branch, or a Federal agency that violated a provision of law described in paragraph (1), if the successor succeeds to the interests of the violator, or the acquisition is made, in good faith and not for purposes of evading this subsection or regulations prescribed under this subsection.
(4) "Senior executive officer" defined
The term "senior executive officer" has the same meaning as in regulations prescribed under
(d) 5 Authority
The Comptroller of the Currency may act in the Comptroller's own name and through the Comptroller's own attorneys in enforcing any provision of title 62 of the Revised Statutes, regulations thereunder, or any other law or regulation, or in any action, suit, or proceeding to which the Comptroller of the Currency is a party.
(R.S. §5239; Mar. 3, 1911, ch. 231, §291,
Editorial Notes
References in Text
Title 62 of the Revised Statutes, referred to in subsecs. (a), (b)(1), and (d), was in the original "this Title" meaning title LXII of the Revised Statutes, consisting of R.S. §§5133 to 5244, which are classified to this section and
Codification
R.S. §5239 derived from act June 3, 1864, ch. 106, §53,
Act Mar. 3, 1911, conferred the powers and duties of the former circuit courts upon the district courts.
Amendments
1994—Subsec. (c).
Subsec. (d).
Subsec. (d)(1)(B).
1992—Subsec. (c).
1989—Subsec. (b).
Subsec. (c).
1982—Subsec. (b)(1).
1978—
Statutory Notes and Related Subsidiaries
Effective Date of 1989 Amendment
"(1) is not already subject to a notice (initiating an administrative proceeding) issued by the appropriate Federal banking agency (as defined in section 3(q) of the Federal Deposit Insurance Act [
"(2) occurred after the completion of the last report of examination of the institution involved by the appropriate Federal banking agency (as so defined) occurring before the date of the enactment of this Act."
Effective Date of 1978 Amendment
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
2 So in original. The word "any" probably should not appear.
3 So in original. Probably should be "not to".
4 So in original. No pars. (9) to (11) have been enacted.
5 So in original. Probably should be "(e)".
§93a. Authority to prescribe rules and regulations
Except to the extent that authority to issue such rules and regulations has been expressly and exclusively granted to another regulatory agency, the Comptroller of the Currency is authorized to prescribe rules and regulations to carry out the responsibilities of the office, except that the authority conferred by this section does not apply to
(R.S. §5239A, as added
Editorial Notes
References in Text
The Glass-Steagall Act, referred to in text, probably refers to act June 16, 1933, ch. 89,
§94. Venue of suits
Any action or proceeding against a national banking association for which the Federal Deposit Insurance Corporation has been appointed receiver, or against the Federal Deposit Insurance Corporation as receiver of such association, shall be brought in the district or territorial court of the United States held within the district in which that association's principal place of business is located, or, in the event any State, county, or municipal court has jurisdiction over such an action or proceeding, in such court in the county or city in which that association's principal place of business is located.
(R.S. §5198; Feb. 18, 1875, ch. 80, §1,
Editorial Notes
Codification
The last sentence of R.S. §5198, as added by act Feb. 18, 1875, ch. 80, §1,
Section is comprised of last sentence of R.S. §5198 as added by act Feb. 18, 1875, ch. 80, §1,
Act Mar. 3, 1911, conferred powers and duties of former circuit courts on district courts.
Amendments
1982—
Statutory Notes and Related Subsidiaries
Effective Date of 1983 Amendment
§94a. Repealed. June 25, 1948, ch. 646, §39, 62 Stat. 992 , eff. Sept. 1, 1948
Section, act July 12, 1882, ch. 290, §4,
§95. Emergency limitations and restrictions on business of members of Federal Reserve System; designation of legal holiday for national banking associations; exceptions; "State" defined
(a) In order to provide for the safer and more effective operation of the National Banking System and the Federal Reserve System, to preserve for the people the full benefits of the currency provided for by the Congress through the National Banking System and the Federal Reserve System, and to relieve interstate commerce of the burdens and obstructions resulting from the receipt on an unsound or unsafe basis of deposits subject to withdrawal by check, during such emergency period as the President of the United States by proclamation may prescribe, no member bank of the Federal Reserve System shall transact any banking business except to such extent and subject to such regulations, limitations and restrictions as may be prescribed by the Secretary of the Treasury, with the approval of the President. Any individual, partnership, corporation, or association, or any director, officer or employee thereof, violating any of the provisions of this section shall be deemed guilty of a misdemeanor and, upon conviction thereof, shall be fined not more than $10,000 or, if a natural person, may, in addition to such fine, be imprisoned for a term not exceeding ten years. Each day that any such violation continues shall be deemed a separate offense.
(b)(1) In the event of natural calamity, riot, insurrection, war, or other emergency conditions occurring in any State whether caused by acts of nature or of man, the Comptroller of the Currency may designate by proclamation any day a legal holiday for the national banking associations located in that State. In the event that the emergency conditions affect only part of a State, the Comptroller of the Currency may designate the part so affected and may proclaim a legal holiday for the national banking associations located in that affected part. In the event that a State or a State official authorized by law designates any day as a legal holiday for ceremonial or emergency reasons, for the State or any part thereof, that same day shall be a legal holiday for all national banking associations or their offices located in that State or the part so affected. A national banking association or its affected offices may close or remain open on such a State-designated holiday unless the Comptroller of the Currency by written order directs otherwise.
(2) For the purpose of this subsection, the term "State" means any of the several States, the District of Columbia, the Commonwealth of Puerto Rico, the Northern Mariana Islands, Guam, the Virgin Islands, American Samoa, the Trust Territory of the Pacific Islands, or any other territory or possession of the United States.
(Mar. 9, 1933, ch. 1, title I, §4,
Editorial Notes
Amendments
1983—Subsec. (b)(1).
1982—Subsec. (b)(1).
1980—
Executive Documents
Termination of Trust Territory of the Pacific Islands
For termination of Trust Territory of the Pacific Islands, see note set out preceding
Bank Holiday of 1933
Proclamations Nos. 2039, 2040, and 2070, dated Mar. 6, 1933, Mar. 9, 1933, and Dec. 30, 1933, respectively, related to the temporary suspension of banking transactions beginning Mar. 6, 1933, by all member banks of the Federal Reserve System.
Pursuant to Ex. Ord. No. 6073, dated March 10, 1933, formerly set out as a note under this section, the Secretary of the Treasury by order of March 11, 1933, authorized all Federal reserve banks and nonmember banks and other banking institutions to resume their normal and usual banking functions on March 13, 1933, subject to certain restrictions. See 31 C.F.R. 121.20–121.22. The fifth and sixth paragraphs of Ex. Ord. No. 6073, relating to the removal of gold coin, gold bullion, or gold certificates from the United States by corporations, etc., including banking institutions and authorization of banking institutions to pay out gold coin, gold bullion or gold certificates, were revoked by Ex. Ord. No. 11825, Dec. 31, 1974, 40 F.R. 1003.
Proc. No. 2725. Exemption of Member Banks of Federal Reserve System
Proc. No. 2725, Apr. 7, 1947, 12 F.R. 2343,
NOW, THEREFORE, I, HARRY S. TRUMAN, President of the United States of America, acting under and by virtue of the authority vested in me by section 5(b) of the Trading with the Enemy Act of October 6, 1917,
This proclamation shall become effective as of March 15, 1947.
§§95a, 95b. Omitted
Editorial Notes
Codification
Section 95a, act Oct. 6, 1917, ch. 106, §5(b),
Section 95b, act Mar. 9, 1933, ch. 1, title I, §1,
SUBCHAPTER V—OBTAINING AND ISSUING CIRCULATING NOTES
§§101 to 110. Repealed. Pub. L. 103–325, title VI, §602(e)(5)–(11), (f)(2)–(4)(A), (g)(9), Sept. 23, 1994, 108 Stat. 2292 , 2294
Section 101, acts Mar. 14, 1900, ch. 41, §12,
Section 101a, R.S. §5159; Dec. 23, 1913, ch. 6, §17,
Section 102, R.S. §5158, construed term "United States bonds" as including registered bonds.
Section 103, act Oct. 5, 1917, ch. 74, §3,
Section 104, R.S. §5172; May 30, 1908, ch. 229, §11,
Section 105, act June 20, 1874, ch. 343, §5,
Section 106, act Mar. 3, 1875, ch. 130, §1,
Section 107, R.S. §5173, related to custody of plates and dies procured for printing notes and payment of expenses.
Section 108, R.S. §5174; Feb. 27, 1877, ch. 69, §1,
Section 109, R.S. §5182; Jan. 13, 1920, ch. 38,
Section 110, R.S. §5183; Feb. 18, 1875, ch. 80, §1,
SUBCHAPTER VI—REDEMPTION AND REPLACEMENT OF CIRCULATING NOTES
§121. Repealed. Pub. L. 103–325, title VI, §602(f)(4)(B), Sept. 23, 1994, 108 Stat. 2292
Section, acts June 20, 1874, ch. 343, §3,
§121a. Redemption of notes unidentifiable as to bank of issue
Whenever any Federal Reserve bank notes or Federal Reserve notes are presented to the Treasurer of the United States for redemption and such notes cannot be identified as to the bank of issue or the bank through which issued, the Treasurer of the United States may redeem such notes under such rules and regulations as the Secretary of the Treasury may prescribe.
(June 13, 1933, ch. 62, §1,
Editorial Notes
Amendments
1994—
1966—
Executive Documents
Transfer of Functions
For transfer of functions to Secretary of the Treasury, see note set out under
§122. Repealed. Pub. L. 97–258, §5(b), Sept. 13, 1982, 96 Stat. 1068
Section, act July 14, 1890, ch. 708, §6,
§122a. Redeemed notes of unidentifiable issue; funds charged against
Federal Reserve bank notes redeemed by the Treasurer of the United States under
(June 13, 1933, ch. 62, §2,
Editorial Notes
References in Text
Amendments
1994—
1966—
Executive Documents
Transfer of Functions
For transfer of functions to Secretary of the Treasury, see note set out under
1 See References in Text note below.
§§123 to 126. Repealed. Pub. L. 103–325, title VI, §602(e)(12), (13), (f)(4)(C), (6), Sept. 23, 1994, 108 Stat. 2292 , 2293
Section 123, R.S. §5195; June 20, 1874, ch. 343, §3,
Section 124, R.S. §5184; June 23, 1874, ch. 455, §1,
Section 125, act July 28, 1892, ch. 317,
Section 126, act June 20, 1874, ch. 343, §8,
§127. Repealed. Pub. L. 89–554, §8(a), Sept. 6, 1966, 80 Stat. 633
Section, act Mar. 3, 1875, ch. 130, §3,
SUBCHAPTER VII—PROCEEDINGS ON FAILURE OF BANK TO REDEEM CIRCULATING NOTES
§§131 to 138. Repealed. Pub. L. 103–325, title VI, §602(e)(14)–(21), Sept. 23, 1994, 108 Stat. 2292
Section 131, R.S. §5226; June 20, 1874, ch. 343, §3,
Section 132, R.S. §5227, related to appointment by Comptroller of the Currency of special agent to examine failure of national banking association to redeem its circulating notes and provided for forfeiture of association's bonds to United States based on findings of agent.
Section 133, R.S. §5228; Feb. 18, 1875, ch. 80, §1,
Section 134, R.S. §5229, provided that, upon declaration of forfeiture of association's bonds, Comptroller of the Currency was to notify holders of circulating notes to present notes for payment and was authorized to cancel bonds pledged by association.
Section 135, R.S. §5232, related to disposition of redeemed notes and perpetuation of evidence of payment of such notes.
Section 136, R.S. §5233, related to cancellation of redeemed notes.
Section 137, R.S. §5230, provided Comptroller of the Currency with option of selling defaulting association's bonds at auction, rather than cancelling them, and granted United States paramount lien on all association assets in case of deficiencies from such sale.
Section 138, R.S. §5231, related to private sale of defaulting association's bonds by Comptroller of the Currency.
SUBCHAPTER VIII—RESERVE CITIES; LAWFUL RESERVES
§141. Omitted
Editorial Notes
Codification
Section, R.S. §5191 (part); acts Dec. 23, 1913, ch. 6, §2 (part),
Some of the other provisions of R.S. §5191 are classified to
For classification of other provisions of section 2 of act Dec. 23, 1913, see Codification note set out under
Statutory Notes and Related Subsidiaries
Central Reserve and Reserve Cities
"(1) New York and Chicago are reclassified as reserve cities under the Federal Reserve Act;
"(2) the classification 'central reserve city' under the Federal Reserve Act, and the authority of the Board of Governors of the Federal Reserve System to classify or reclassify cities as 'central reserve cities' under such Act, are terminated;
"(3) section 5192 of the Revised Statutes of the United States (
"(4) section 2 of the Act of March 3, 1887 (ch. 378;
"(5) the last paragraph of section 2 of the Federal Reserve act (
"(6) section 11(e) of the Federal Reserve Act (
"(7) the third paragraph (lettered (a)) of section 19 of the Federal Reserve Act (
"(8) the fifth paragraph (lettered (c)) of such section 19 is repealed;
"(9) subparagraph (2) of the sixth paragraph of such section 19 (as added by the first section of this Act) is amended by striking out 'and a member bank in a central reserve city may hold and maintain the reserve balances which are in effect under this section for member banks described in paragraph (a) or (b),';
"(10) the seventh paragraph of such section 19 is amended by striking out clauses (1), (2), (3), and (4) and inserting in lieu thereof the following: '(1) by member banks in reserve cities, (2) by member banks not in reserve cities, or (3) by all member banks'; and
"(11) the seventh paragraph of such section is further amended by striking out 'and central reserve cities'."
§142. Banks in reserve cities; reserves
National banking associations located in reserve cities or central reserve cities shall maintain reserves provided for in
(R.S. §5191 (part); Dec. 23, 1913, ch. 6, §§19, 27,
Editorial Notes
References in Text
Codification
R.S. §5191 derived from act June 3, 1864, ch. 106, §31,
Some of the other provisions of R.S. §5191 were classified to
Statutory Notes and Related Subsidiaries
Termination of Central Reserve Cities
Central reserve cities terminated, see section 3(b) of
§143. Banks in Alaska and insular possessions; lawful money reserves
Every national banking association located in Alaska or in a dependency or insular possession or any part of the United States outside of the continental United States, and not a member of the Federal reserve system, shall at all times have on hand in lawful money of the United States an amount equal to at least 15 percent of the aggregate amount of its deposits in all respects. Whenever the lawful money of any such association shall fall below 15 percent of its deposits such association shall not increase its liabilities by making any new loans or discounts other than by discounting or purchasing bills of exchange payable at sight nor make any dividends of its profits until the required proportion between the aggregate amount of its deposits and its lawful money of the United States has been restored. And the Comptroller of the Currency shall notify any such association whose lawful money reserve shall be below the amount required to be kept on hand to make good such reserve, and if such association shall fail for thirty days thereafter so to make good its lawful money the Comptroller may, with the concurrence of the Secretary of the Treasury, appoint a receiver to wind up the business of the association as provided in
(R.S. §5191 (part).)
Editorial Notes
Codification
R.S. §5191 derived from act June 3, 1864, ch. 106, §31,
Some of the other provisions of R.S. §5191 were classified to
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§144. Certain balances counted toward reserves in dependencies and insular possessions
Four-fifths of the reserve of 15 per centum which a national bank located in a dependency or insular possession or any part of the United States outside of the continental United States, and not a member of the Federal Reserve System, is required to keep, may consist of balances due such bank from associations approved by the Comptroller of the Currency and located in any one of the reserve cities as now or hereafter defined by law or designated by the Board of Governors of the Federal Reserve System.
(R.S. §5192; July 1, 1952, ch. 536,
Editorial Notes
Codification
R.S. §5192 derived from act June 3, 1864, ch. 106, §31,
Amendments
1959—
1952—Act July 1, 1952, reduced the required amount of cash on hand from two-fifths to one-fifth of the required reserve of 15 per centum.
Statutory Notes and Related Subsidiaries
Effective Date of 1959 Amendment
Amendment by
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§§145, 146. Repealed. Pub. L. 97–258, §5(b), Sept. 13, 1982, 96 Stat. 1068
Section 145, act July 14, 1890, ch. 708, §2,
Section 146, act July 12, 1882, ch. 290, §12,
SUBCHAPTER IX—FORMATION OF ASSOCIATIONS TO ISSUE GOLD NOTES
§§151 to 153. Repealed. Pub. L. 103–325, title VI, §602(e)(22), (23), (f)(7), Sept. 23, 1994, 108 Stat. 2292 , 2293
Section 151, R.S. §5185; Jan. 19, 1875, ch. 19,
Section 152, R.S. §5186, related to mandatory establishment of lawful money reserves by associations issuing gold notes and reception by such associations of gold notes of other associations in payment of debts.
Section 153, act Feb. 14, 1880, ch. 25,
SUBCHAPTER X—BANK EXAMINATIONS; REPORTS
§161. Reports to Comptroller of the Currency
(a) Reports of condition; form; contents; date of making; publication
Every association shall make reports of condition to the Comptroller of the Currency in accordance with the Federal Deposit Insurance Act [
(b) Payment of dividends
Every association shall make to the Comptroller reports of the payment of dividends, including advance reports of dividends proposed to be declared or paid in such cases and under such conditions as the Comptroller deems necessary to carry out the purposes of the laws relating to national banking associations in such form and at such times as he may require.
(c) Reports of affiliates; form; contents; date of making; publication; penalties
Each national banking association shall obtain from each of its affiliates other than member banks and furnish to the Comptroller of the Currency not less than four reports during each year, in such form as the Comptroller may prescribe, verified by the oath or affirmation of the president or such other officer as may be designated by the board of directors of such affiliate to verify such reports, disclosing the information hereinafter provided for as of dates identical with those for which the Comptroller shall during such year require the reports of the condition of the association. Each such report of an affiliate shall be transmitted to the Comptroller at the same time as the corresponding report of the association, except that the Comptroller may, in his discretion, extend such time for good cause shown. Each such report shall contain such information as in the judgment of the Comptroller of the Currency shall be necessary to disclose fully the relations between such affiliate and such bank and to enable the Comptroller to inform himself as to the effect of such relations upon the affairs of such bank. The Comptroller shall also have power to call for additional reports with respect to any such affiliate whenever in his judgment the same are necessary in order to obtain a full and complete knowledge of the conditions of the association with which it is affiliated. Such additional reports shall be transmitted to the Comptroller of the Currency in such form as he may prescribe.
(R.S. §5211; Feb. 27, 1877, ch. 69, §1,
Editorial Notes
References in Text
The Federal Deposit Insurance Act, referred to in subsec. (a), is act Sept. 21, 1950, ch. 967, §2,
Codification
R.S. §5211 derived from act June 3, 1864, ch. 106, §34,
Amendments
1994—Subsec. (a).
Subsec. (c).
1989—Subsec. (a).
Subsec. (c).
1966—Subsec. (c).
1960—Subsec. (a).
Subsec. (b).
Subsec. (c).
1959—
1933—Act June 16, 1933, added second par.
1927—Act Feb. 25, 1927, inserted "or of a vice-president, or of an assistant cashier of the association designated by its board of directors to verify such reports in the absence of the president and cashier, taken before a notary public properly authorized and commissioned by the State in which such notary resides and the association is located, or any other officer having an official seal, authorized in such State to administer oaths" in first sentence, and "and the statement of resources and liabilities together with acknowledgment and attestation", in second sentence.
Statutory Notes and Related Subsidiaries
Effective Date of 1989 Amendment
Effective Date of 1960 Amendment
Amendment by
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§162. Repealed. Pub. L. 86–671, §6, July 14, 1960, 74 Stat. 552 .
Section, act Feb. 26, 1881, ch. 82,
Statutory Notes and Related Subsidiaries
Effective Date of Repeal
Repeal effective Jan. 1, 1961, see section 7 of
§163. Repealed. Pub. L. 86–230, §22(a), Sept. 8, 1959, 73 Stat. 466
Section, R.S. §5212, related to report of dividends and net earnings. See
§164. Penalty for failure to make reports
(a) First tier
Any association which—
(1) maintains procedures reasonably adapted to avoid any inadvertent error and, unintentionally and as a result of such an error—
(A) fails to make, obtain, transmit, or publish any report or information required by the Comptroller of the Currency under
(B) submits or publishes any false or misleading report or information; or
(2) inadvertently transmits or publishes any report which is minimally late,
shall be subject to a penalty of not more than $2,000 for each day during which such failure continues or such false or misleading information is not corrected. The association shall have the burden of proving that an error was inadvertent and that a report was inadvertently transmitted or published late.
(b) Second tier
Any association which—
(1) fails to make, obtain, transmit, or publish any report or information required by the Comptroller of the Currency under
(2) submits or publishes any false or misleading report or information,
in a manner not described in subsection (a) shall be subject to a penalty of not more than $20,000 for each day during which such failure continues or such false or misleading information is not corrected.
(c) Third tier
Notwithstanding subsections (a) and (b), if any association knowingly or with reckless disregard for the accuracy of any information or report described in subsection (b) submits or publishes any false or misleading report or information, the Comptroller may assess a penalty of not more than $1,000,000 or 1 percent of total assets of the association, whichever is less, per day for each day during which such failure continues or such false or misleading information is not corrected.
(d) Assessment; etc.
Any penalty imposed under subsection (a), (b), or (c) shall be assessed and collected by the Comptroller of the Currency in the manner provided in subparagraphs (E), (F), (G), and (I) of
(e) Hearing
Any association against which any penalty is assessed under this subsection 1 shall be afforded an agency hearing if such association submits a request for such hearing within 20 days after the issuance of the notice of assessment.
(R.S. §5213;
Editorial Notes
Codification
R.S. §5213 derived from act Mar. 3, 1869, ch. 130, §§1, 2,
Amendments
1989—
1959—
Statutory Notes and Related Subsidiaries
Effective Date of 1989 Amendment
Amendment by
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
1 So in original. Probably should be "section".
§165. Omitted
Editorial Notes
Codification
Section, R.S. §5241, related to limitation of visitorial powers. See
SUBCHAPTER XI—MISCELLANEOUS PROVISIONS REGARDING UNITED STATES BONDS IN RELATION TO NATIONAL BANKS
§§168 to 177. Repealed. Pub. L. 103–325, title VI, §602(e)(24)–(31), (f)(4)(D), (5)(A), Sept. 23, 1994, 108 Stat. 2292 , 2293
Section 168, R.S. §5160, authorized associations to take up bonds upon returning circulating notes to Comptroller of the Currency.
Section 169, R.S. §5161, related to exchange of United States coupon bonds for registered bonds.
Section 170, R.S. §5162; Aug. 23, 1935, ch. 614, §313,
Section 171, R.S. §5163, related to establishment of registry of transferred bonds by Comptroller of the Currency.
Section 172, R.S. §5164, required Comptroller of the Currency to notify national banking associations of transfers from its accounts.
Section 173, R.S. §5165, related to examination of registry and bonds by Comptroller of the Currency and Treasurer of United States.
Section 174, R.S. §5166, related to annual examination of bonds by national banking associations.
Section 175, R.S. §5167, related to custody of bonds and collection of interest.
Section 176, acts June 20, 1874, ch. 343, §4,
Section 177, acts July 12, 1882, ch. 290, §8,
§177a. Funds available for cost of transporting and redeeming national and Federal Reserve bank notes
The cost of transporting and redeeming outstanding national bank notes and Federal Reserve bank notes as may be presented to the Treasurer of the United States for redemption shall be paid from the regular annual appropriation for the Department of the Treasury.
(Oct. 10, 1940, ch. 841,
Editorial Notes
Amendments
1994—
§178. Repealed. Pub. L. 103–325, title VI, §602(f)(5)(B), Sept. 23, 1994, 108 Stat. 2293
Section, acts July 12, 1882, ch. 290, §9,
SUBCHAPTER XII—VOLUNTARY DISSOLUTION
§181. Voluntary dissolution; appointment and removal of liquidating agent or committee; examination
Any association may go into liquidation and be closed by the vote of its shareholders owning two-thirds of its stock. If the liquidation is to be effected in whole or in part through the sale of any of its assets to and the assumption of its deposit liabilities by another bank, the purchase and sale agreement must also be approved by its shareholders owning two-thirds of its stock unless an emergency exists and the Comptroller of the Currency specifically waives such requirement for shareholder approval.
The shareholders shall designate one or more persons to act as liquidating agent or committee, who shall conduct the liquidation in accordance with law and under the supervision of the board of directors, who shall require a suitable bond to be given by said agent or committee. The liquidating agent or committee shall render annual reports to the Comptroller of the Currency on the 31st day of December of each year showing the progress of said liquidation until the same is completed. The liquidating agent or committee shall also make an annual report to a meeting of the shareholders to be held on the date fixed in the articles of association for the annual meeting, at which meeting the shareholders may, if they see fit, by a vote representing a majority of the entire stock of the bank, remove the liquidating agent or committee and appoint one or more others in place thereof. A special meeting of the shareholders may be called at any time in the same manner as if the bank continued an active bank and at said meeting the shareholders may, by vote of the majority of the stock, remove the liquidating agent or committee. The Comptroller of the Currency is authorized to have an examination made at any time into the affairs of the liquidating bank until the claims of all creditors have been satisfied, and the expense of making such examinations shall be assessed against such bank in the same manner as in the case of examinations made pursuant to subchapter XV of
(R.S. §5220; Aug. 23, 1935, ch. 614, title III, §317,
Editorial Notes
References in Text
Subchapter XV [§481 et seq.] of
Codification
R.S. §5220 derived from act June 3, 1864, ch. 106, §42,
Amendments
1959—
1935—Act Aug. 23, 1935, added second par.
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§182. Notice of intent to dissolve
Whenever a vote is taken to go into liquidation it shall be the duty of the board of directors to cause notice of this fact to be certified, under the seal of the association, by its president or cashier, to the Comptroller of the Currency, and publication thereof to be made for a period of two months in every issue of a newspaper published in the city or town in which the association is located, or if no newspaper is there published, then in the newspaper published nearest thereto, that the association is closing up its affairs, and notifying its creditors to present their claims against the association for payment.
(R.S. §5221; Aug. 9, 1955, ch. 626,
Editorial Notes
Codification
R.S. §5221 derived from act June 3, 1864, ch. 106, §42,
Amendments
1955—Act Aug. 9, 1955, struck out provisions relating to publication in a newspaper published in the City of New York, and notification to holders of national bank notes to present them for payment.
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§§183 to 186. Repealed. Pub. L. 103–325, title VI, §602(e)(32)–(35), Sept. 23, 1994, 108 Stat. 2292
Section 183, R.S. §5222, provided that, within six months of voting to liquidate, an association was to deposit with Treasurer of United States money sufficient to redeem all outstanding circulation.
Section 184, R.S. §5223, exempted associations which wound up business for purpose of consolidating with another association from requirement to deposit money to redeem all outstanding circulation.
Section 185, R.S. §5224; Feb. 18, 1875, ch. 80, §1,
Section 186, R.S. §5225; Feb. 27, 1877, ch. 69, §1,
SUBCHAPTER XIII—RECEIVERSHIP
§191. Appointment of receiver for a national bank
(a) In general
The Comptroller of the Currency may, without prior notice or hearings, appoint a receiver for any national bank (and such receiver shall be the Federal Deposit Insurance Corporation if the national bank is an insured bank (as defined in
(1) 1 or more of the grounds specified in
(2) the association's board of directors consists of fewer than 5 members.
(b) Judicial review
If the Comptroller of the Currency appoints a receiver under subsection (a), the national bank may, within 30 days thereafter, bring an action in the United States district court for the judicial district in which the home office of such bank is located, or in the United States District Court for the District of Columbia, for an order requiring the Comptroller of the Currency to remove the receiver, and the court shall, upon the merits, dismiss such action or direct the Comptroller of the Currency to remove the receiver.
(June 30, 1876, ch. 156, §2, formerly §1,
Editorial Notes
Prior Provisions
A prior section 2 of act June 30, 1876, was classified to
Amendments
2006—
Subsec. (b).
1992—
1991—
1959—
Statutory Notes and Related Subsidiaries
Effective Date of 2006 Amendment
Effective Date of 1992 Amendment
"(a)
"(b)
Effective Date of 1991 Amendment
Short Title
Act June 30, 1876, ch. 156, §1, as added by
Application to District of Columbia
Provisions of this section were made applicable to banks, etc., in the District of Columbia by act Mar. 4, 1933, ch. 274, §4,
Termination of National Bank Closed Receivership Fund
"
"(1) providing final notice of availability of liquidating dividends to creditors of national banks which have been closed and for which the Comptroller has appointed a receiver other than the Federal Deposit Insurance Corporation;
"(2) barring rights of creditors to collect liquidating dividends from the Comptroller of the Currency after a reasonable period of time following such final notice; and
"(3) refunding to the Comptroller the principal amount of such fund and any income earned thereon.
"
"(1) the term 'closed receivership fund' means the aggregation of undisbursed liquidating dividends from national banks which have been closed and for which the Comptroller has appointed a receiver other than the Federal Deposit Insurance Corporation, held by the Comptroller in his capacity as successor to receivers of those banks;
"(2) the term 'Comptroller' means the Comptroller of the Currency;
"(3) the term 'claimant' means a depositor or other creditor who asserts a claim against a closed national bank for a liquidating dividend; and
"(4) the term 'liquidating dividend' means an amount of money in the closed receivership fund determined by a receiver of a closed national bank or by the Comptroller to be owed by that bank to a depositor or other creditor.
"
"(b) The Comptroller shall pay the principal amount of a liquidating dividend, exclusive of any income earned thereon, to a claimant presenting a valid claim, if the claimant applies to collect within twelve months following the last date notice is published.
"(c) If a creditor shall fail to apply to collect a liquidating dividend within twelve months after the last date notice is published, all rights of the claimant against the closed receivership fund with respect to the liquidating dividend shall be barred.
"(d) The principal amount of any liquidating dividends (1) for which claims have not been asserted within twelve months following the last date notice is published or (2) for which the Comptroller has determined a valid claim has not been submitted shall, together with any income earned on liquidating dividends and other moneys, if any, remaining in the closed receivership fund, be covered into the general funds of the Comptroller."
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§192. Default in payment of circulating notes
On becoming satisfied, as specified in sections 131 and 132 1 of this title, that any association is in default, the Comptroller of the Currency may forthwith appoint a receiver, and require of him such bond and security as he deems proper. Such receiver, under the direction of the Comptroller, shall take possession of the books, records, and assets of every description of such association, collect all debts, dues, and claims belonging to it, and, upon the order of a court of record of competent jurisdiction, may sell or compound all bad or doubtful debts, and, on a like order, may sell all the real and personal property of such association, on such terms as the court shall direct. Such receiver shall pay over all money so made to the Treasurer of the United States, subject to the order of the Comptroller, and also make report to the Comptroller of all his acts and proceedings.
Provided, That the Comptroller may, if he deems proper, deposit any of the money so made in any regular Government depositary, or in any State or national bank either of the city or town in which the insolvent bank was located, or of a city or town as adjacent thereto as practicable; if such deposit is made he shall require the depositary to deposit United States bonds or other satisfactory securities with the Treasurer of the United States for the safekeeping and prompt payment of the money so deposited: Provided, That no security in the form of deposit of United States bonds, or otherwise, shall be required in the case of such parts of the deposits as are insured under section 12B of the Federal Reserve Act, as amended. Such depositary shall pay upon such money interest at such rate as the Comptroller may prescribe, not less, however, than 2 per centum per annum upon the average monthly amount of such deposits.
(R.S. §5234; May 15, 1916, ch. 121,
Editorial Notes
References in Text
Section 12B of the Federal Reserve Act, as amended, referred to in text, formerly classified to
Codification
R.S. §5234 derived from act June 3, 1864, ch. 106, §50,
Amendments
1994—
1959—
1935—Act Aug. 23, 1935, inserted second proviso in second par.
Statutory Notes and Related Subsidiaries
Application to District of Columbia
Provisions of this section were made applicable to banks, etc., in the District of Columbia by act Mar. 4, 1933, ch. 274, §4,
Interest on Deposits
So much of existing law requiring the payment of interest with respect to any funds deposited by the United States or by any public instrumentality, agency, or officer thereof, as is inconsistent with former section 371a, sections 371b, 374, 374a, and 461, former sections 462 to 465, and
Executive Documents
Transfer of Functions
For transfer of functions to Secretary of the Treasury, see note set out under
1 See References in Text note below.
§193. Notice to present claims
The Comptroller shall, upon appointing a receiver, cause notice to be given, by advertisement in such newspapers as he may direct, for three consecutive months, calling on all persons who may have claims against such association to present the same, and to make legal proof thereof.
(R.S. §5235.)
Editorial Notes
Codification
R.S. §5235 derived from act June 3, 1864, ch. 106, §50,
Statutory Notes and Related Subsidiaries
Application to District of Columbia
Provisions of this section were made applicable to banks, etc., in the District of Columbia by act Mar. 4, 1933, ch. 274, §4,
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§194. Dividends on adjusted claims; distribution of assets
From time to time, the comptroller shall make a ratable dividend of the money so paid over to him by such receiver on all such claims as may have been proved to his satisfaction or adjudicated in a court of competent jurisdiction, and, as the proceeds of the assets of such association are paid over to him, shall make further dividends on all claims previously proved or adjudicated; and the remainder of the proceeds, if any, shall be paid over to the shareholders of such association, or their legal representatives, in proportion to the stock by them respectively held.
(R.S. §5236;
Editorial Notes
Codification
R.S. §5236 derived from act June 3, 1864, ch. 106, §50,
Amendments
1994—
Statutory Notes and Related Subsidiaries
Application to District of Columbia
Provisions of this section were made applicable to banks, etc. in the District of Columbia by act Mar. 4, 1933, ch. 274, §4,
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§195. Repealed. Pub. L. 103–325, title VI, §602(e)(36), Sept. 23, 1994, 108 Stat. 2292
Section, R.S. §5237; Mar. 3, 1911, ch. 231, §289,
§196. Expenses
All expenses of any preliminary or other examinations into the condition of any association shall be paid by such association. All expenses of any receivership shall be paid out of the assets of such association before distribution of the proceeds thereof.
(R.S. §5238;
Editorial Notes
Codification
R.S. §5238 derived from act June 3, 1864, ch. 106, §51,
Amendments
1994—
§197. Shareholders' meeting; continuance of receivership; appointment of agent; winding up business; distribution of assets
(a) Whenever any national banking association shall have been or shall be placed in the hands of a receiver, as provided in section fifty-two hundred and thirty-four [
(b) Upon receiving such deed, assignment, transfer, or other instrument the person elected such agent shall hold, control, and dispose of the assets and property of the association which he may receive under the terms hereof for the benefit of the shareholders of the association, and he may in his own name, or in the name of the association, sue and be sued and do all other lawful acts and things necessary to finally settle and distribute the assets and property in his hands, and may sell, compromise, or compound the debts due to the association, with the consent and approval of the district court of the United States for the district where the business of the association was carried on, and shall at the conclusion of his trust render to such district court a full account of all his proceedings, receipts, and expenditures as such agent, which court shall, upon due notice, settle and adjust such accounts and discharge such agent and sureties upon such bond. In case any such agent so elected shall die, resign, or be removed, any shareholder may call a meeting of the shareholders of the association in the town, city, or village where the business of the association was carried on, by giving notice thereof for thirty days in a newspaper published in such town, city, or village, or if no newspaper is there published, in the newspaper published nearest thereto, at which meeting the shareholders shall elect an agent, voting by ballot, in person or by proxy, each share of stock entitling the holder to one vote, and when such agent shall have received votes representing at least a majority of the stock in number of shares, and shall have executed a bond to the shareholders conditioned for the payment and discharge in full or, to the extent possible from the remaining assets of the association, of each and every claim that may thereafter be proved and allowed by and before a competent court and for the faithful performance of his duties, in the penalty fixed by the shareholders at such meeting, with a surety or sureties, to be approved by such court, and file such bond in the office of the clerk of that court, he shall have all the rights, powers, and duties of the agent first elected as hereinbefore provided. At any meeting held as hereinbefore provided administrators or executors of deceased shareholders may act and sign as the decedent might have done if living, and guardians of minors and trustees of other persons may so act and sign for their ward or wards or cestui que trust. The proceeds of the assets or property of any such association which may be undistributed at the time of such meeting or may be subsequently received shall be distributed as follows:
First. To pay the expenses of the execution of the trust to the date of such payment.
Second. To repay any amount or amounts which have been paid in by any shareholder or shareholders of the association upon and by reason of any and all assessments made upon the stock of the association by order of the Comptroller of the Currency in accordance with the provisions of the statutes of the United States.
Third. To pay the balance ratably among such stockholders, in proportion to the number of shares held and owned by each. Such distribution shall be made from time to time as the proceeds shall be received and as shall be deemed advisable by the Comptroller of the Currency, or the Federal Deposit Insurance Corporation if continued as receiver of the bank under subsection (a) of this section, or such agent, as the case may be.
(June 30, 1876, ch. 156, §3,
Editorial Notes
References in Text
Section fifty-two hundred and thirty-four and other sections of the Revised Statutes of the United States, referred to in subsec. (a), are classified to
This Act, referred to in subsec. (a), is act June 30, 1876, ch. 156,
Amendments
1959—Subsec. (a).
Subsec. (b).
Statutory Notes and Related Subsidiaries
Transfer of Functions
Act Mar. 3, 1911, conferred upon the district courts all powers formerly vested in the former circuit courts.
Application to District of Columbia
Provisions of this section were made applicable to banks, etc., in the District of Columbia by act Mar. 4, 1933, ch. 274, §4,
Executive Documents
Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see Exception as to Transfer of Functions note set out under
§197a. Resumption of business by closed bank on consent of depositors
In any case in which, in the opinion of the Comptroller of the Currency, it would be to the advantage of the depositors and unsecured creditors of any national banking association whose business has been closed, for such association to resume business upon the retention by the association, for a reasonable period to be prescribed by the Comptroller, of all or any part of its deposits, the Comptroller is authorized, in his discretion, to permit the association to resume business if depositors and unsecured creditors of the association representing at least 75 per centum of its total deposit and unsecured credit liabilities consent in writing to such retention of deposits. Nothing in this section shall be construed to affect in any manner any powers of the Comptroller under the provisions of law in force on June 16, 1933, with respect to the reorganization of national banking associations.
(June 16, 1933, ch. 89, §29,
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§198. Purchase by receiver of property of bank; request to Comptroller
Whenever the receiver of any national bank duly appointed by the Comptroller of the Currency, and who shall have duly qualified and entered upon the discharge of his trust, shall find it in his opinion necessary, in order to fully protect and benefit his said trust, to the extent of any and all equities that such trust may have in any property, real or personal, by reason of any bond, mortgage, assignment, or other proper legal claim attaching thereto, and which said property is to be sold under any execution, decree of foreclosure, or proper order of any court of jurisdiction, he may certify the facts in the case, together with his opinion as to the value of the property to be sold, and the value of the equity his said trust may have in the same, to the Comptroller of the Currency, together with a request for the right and authority to use and employ so much of the money of said trust as may be necessary to purchase such property at such sale.
(Mar. 29, 1886, ch. 28, §1,
Statutory Notes and Related Subsidiaries
Application to District of Columbia
Provisions of this section were made applicable to banks, etc., in the District of Columbia by act Mar. 4, 1933, ch. 274, §4,
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§199. Approval of request
Such request, if approved by the Comptroller of the Currency, shall be, together with the certificate of facts in the case, and his recommendation as to the amount of money which, in his judgment, should be so used and employed, submitted to the Secretary of the Treasury, and if the same shall likewise be approved by him, the request shall be by the Comptroller of the Currency allowed, and notice thereof, with copies of the request, certificate of facts, and indorsement of approvals, shall be filed with the Treasurer of the United States.
(Mar. 29, 1886, ch. 28, §2,
Statutory Notes and Related Subsidiaries
Application to District of Columbia
Provisions of this section were made applicable to banks, etc., in the District of Columbia by act Mar. 4, 1933, ch. 274, §4,
Executive Documents
Transfer of Functions
For transfer of functions to Secretary of the Treasury, see note set out under
§200. Payment
Whenever any such request shall be allowed as hereinbefore provided, the said Comptroller of the Currency shall be, and is, empowered to draw upon and from such funds of any such trust as may be deposited with the Treasurer of the United States for the benefit of the bank in interest, to the amount as may be recommended and allowed and for the purpose for which such allowance was made: Provided, however, That all payments to be made for or on account of the purchase of any such property and under any such allowance shall be made by the Comptroller of the Currency direct, with the approval of the Secretary of the Treasury, for such purpose only and in such manner as he may determine and order.
(Mar. 29, 1886, ch. 28, §3,
Statutory Notes and Related Subsidiaries
Application to District of Columbia
Provisions of this section were made applicable to banks, etc., in the District of Columbia by act Mar. 4, 1933, ch. 274, §4,
Executive Documents
Transfer of Functions
For transfer of functions to Secretary of the Treasury, see note set out under
SUBCHAPTER XIV—BANK CONSERVATION ACT
§201. Short title
This subchapter may be cited as the "Bank Conservation Act."
(Mar. 9, 1933, ch. 1, title II, §201,
§202. Definitions
As used in this subchapter, the term "bank" means any national banking association or any other financial institution chartered or licensed under Federal law and subject to the supervision of the Comptroller of the Currency; the term "voluntary dissolution and liquidation" means a transaction pursuant to
(Mar. 9, 1933, ch. 1, title II, §202,
Editorial Notes
References in Text
For definition of Canal Zone, referred to in text, see
Amendments
2006—Pub. L.
1989—
§203. Appointment of conservator
(a) Appointment
The Comptroller of the Currency may, without prior notice or hearings, appoint a conservator (which may be the Federal Deposit Insurance Corporation) to the possession and control of a bank whenever the Comptroller of the Currency determines that 1 or more of the grounds specified in section 11(c)(5) of the Federal Deposit Insurance Act [
(b) Judicial review
(1) In general
Not later than 20 days after the initial appointment of a conservator pursuant to this section, the bank may bring an action in the United States district court for the judicial district in which the home office of such bank is located, or in the United States District Court for the District of Columbia, for an order requiring the Comptroller to terminate the appointment of the conservator, and the court, upon the merits, shall dismiss such action or shall direct the Comptroller to terminate the appointment of such conservator. The Comptroller's decision to appoint a conservator pursuant to this section shall be set aside only if the court finds that such decision was arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.
(2) Stay
The conservator may request that any judicial action or proceeding to which the conservator or the bank is or may become a party be stayed for a period of up to 45 days after the appointment of the conservator. Upon petition, the court shall grant such stay as to all parties.
(3) Actions and orders
Except as otherwise provided in this subsection, no court may take any action regarding the removal of a conservator, or restrain, or affect the exercise of powers or functions of a conservator. A court, upon application by the Comptroller, shall have jurisdiction to enforce an order of the Comptroller relating to—
(A) the conservatorship and the bank in conservatorship, or
(B) restraining or affecting the exercise of powers or functions of a conservator.
(c) Additional grounds for appointment
In addition to the foregoing provisions, the Comptroller may appoint a conservator for a bank if—
(1) the bank, by an affirmative vote of a majority of its board of directors or by an affirmative vote of a majority of its shareholders, consents to such appointment, or
(2) the Federal Deposit Insurance Corporation terminates the bank's status as an insured bank.
The appointment of a conservator pursuant to this subsection shall not be subject to review.
(d) Exclusive authority
The Comptroller shall have exclusive power and jurisdiction to appoint a conservator for a bank. Whenever the Comptroller appoints a conservator for any bank, the Comptroller may appoint the Federal Deposit Insurance Corporation conservator for such bank. The Federal Deposit Insurance Corporation, as such conservator, shall have all the powers granted under the Federal Deposit Insurance Act [
(e) Replacement of conservator
The Comptroller may, without notice or hearing, replace a conservator with another conservator. Such replacement shall not affect the bank's right under subsection (b) to obtain judicial review of the Comptroller's original decision to appoint a conservator.
(Mar. 9, 1933, ch. 1, title II, §203,
Editorial Notes
References in Text
The Federal Deposit Insurance Act, referred to in subsec. (d), is act Sept. 21, 1950, ch. 967, §2,
This Act, referred to in subsec. (d), is act Mar. 9, 1933, ch. 1,
Amendments
1991—Subsec. (a).
1989—
Statutory Notes and Related Subsidiaries
Effective Date of 1991 Amendment
Amendment by
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
Conservators of State Banks
Ex. Ord. No. 6080, Mar. 18, 1933, provided for appointment of conservators of State banks under certain regulations.
§204. Examinations
The Comptroller of the Currency (in consultation with the Board of Directors of the Federal Deposit Insurance Corporation when the Corporation is appointed conservator) is authorized to examine and supervise the bank in conservatorship as long as the bank continues to operate as a going concern. The Comptroller may use reports and other information provided by the Federal Deposit Insurance Corporation for this purpose.
(Mar. 9, 1933, ch. 1, title II, §204,
Editorial Notes
Amendments
1989—
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§205. Termination of conservatorship
(a) General rule
At any time the Comptroller 1 becomes satisfied that it may safely be done and that it would be in the public interest, the Comptroller (with the agreement of the Board of Directors of the Federal Deposit Insurance Corporation when the Corporation has been appointed conservator) may—
(1) terminate the conservatorship and permit the involved bank to resume the transaction of its business subject to such terms, conditions, and limitations as the Comptroller may prescribe; or
(2) terminate the conservatorship upon a sale, merger, consolidation, purchase and assumption, change in control, or voluntary dissolution and liquidation of the involved bank.
(b) Other grounds for termination
The Comptroller also may terminate the conservatorship upon the appointment of a receiver pursuant to
(c) Enforcement under Federal Deposit Insurance Act
Such terms, conditions, and limitations as may be prescribed under subsection (a)(1) shall be enforceable under the provisions of section 8(i) of the Federal Deposit Insurance Act [
(d) Action upon termination
(1) In general
Upon termination of the conservatorship under subsection (a)(2), the Federal Deposit Insurance Corporation, as conservator, or when another person is appointed conservator, such other person, shall conclude the affairs of the conservatorship in accordance with paragraph (2).
(2) Deposit and distribution of proceeds
(A) Within 180 days of the sale, merger, consolidation, purchase and assumption, change in control, or voluntary dissolution and liquidation, the conservator shall deposit all net proceeds received from the transaction, less any outstanding expenses of the conservatorship, with the United States district court for the judicial district in which the home office of such bank is located and shall cause notice to be published for three consecutive months and notify by mail all known and remaining creditors and shareholders. Within 60 days thereafter, any depositor, creditor, or other claimant of the bank, or any shareholder of the bank may bring an action in interpleader in that court for distribution of the proceeds. The district court shall distribute such funds equitably. If no such action is instituted within one year after the date the funds are deposited with the district court, title to such net proceeds shall revert to the United States and the district court shall remit the funds to the Treasury of the United States.
(B) The conservator shall be deemed to have discharged all responsibility of the conservatorship upon the deposit of the proceeds with the district court and giving the required notifications.
(Mar. 9, 1933, ch. 1, title II, §205,
Editorial Notes
References in Text
The Federal Deposit Insurance Act, referred to in subsec. (c), is act Sept. 21, 1950, ch. 967, §2,
Amendments
1989—
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
1 So in original. Probably should be "Comptroller of the Currency".
§206. Conservator; powers and duties
(a) General powers
A conservator shall have all the powers of the shareholders, directors, and officers of the bank and may operate the bank in its own name unless the Comptroller 1 in the order of appointment limits the conservator's authority.
(b) Subject to rules of Comptroller
The conservator shall be subject to such rules, regulations, and orders as the Comptroller from time to time deems appropriate; and, except as otherwise specifically provided in such rules, regulations, or orders or in
(c) Payment of depositors and creditors
The Comptroller may require the conservator to set aside and make available for withdrawal by depositors and payment to other creditors such amounts as in the opinion of the Comptroller may safely be used for that purpose. All depositors and creditors who are similarly situated shall be treated in the same manner.
(d) Compensation of conservator and employees
The conservator and professional employees appointed to represent or assist the conservator shall not be paid amounts greater than are payable to employees of the Federal Government for similar services, except that the Comptroller of the Currency may authorize payment at higher rates (but not in excess of rates prevailing in the private sector), if the Comptroller determines that paying such higher rates is necessary in order to recruit and retain competent personnel.
(e) Expenses
All expenses of any such conservatorship shall be paid by the bank and shall be a lien upon the bank which shall be prior to any other lien.
(Mar. 9, 1933, ch. 1, title II, §206,
Editorial Notes
Amendments
1989—
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
1 So in original. Probably should be "Comptroller of the Currency".
§§207, 208. Repealed. Pub. L. 101–73, title VIII, §808, Aug. 9, 1989, 103 Stat. 446
Section 207, acts Mar. 9, 1933, ch. 1, title II, §207,
Section 208, act Mar. 9, 1933, ch. 1, title II, §208,
§209. Liability protection
(a) Federal agency and employees
In any case in which the conservator is a Federal agency or an employee of the Government, the provisions of chapters 161 and 171 of title 28 shall apply with respect to such conservator's liability for acts or omissions performed pursuant to and in the course of the duties and responsibilities of the conservatorship.
(b) Other conservators
In any case where the conservator is not a conservator described in subsection (a), the conservator shall not be liable for damages in tort or otherwise for acts or omissions performed pursuant to and in the course of the duties and responsibilities of the conservatorship, unless such acts or omissions constitute gross negligence, including any similar conduct or any form of intentional tortious conduct, as determined by a court.
(c) Indemnification
The Comptroller 1 shall have authority to indemnify the conservator on such terms as the Comptroller deems proper.
(Mar. 9, 1933, ch. 1, title II, §209,
Editorial Notes
Amendments
1989—
1954—Act Sept. 3, 1954, corrected references to title 18.
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
1 So in original. Probably should be "Comptroller of the Currency".
§210. Governmental powers unimpaired
Nothing in this subchapter shall be construed to impair in any manner any powers of the President, the Secretary of the Treasury, the Comptroller of the Currency, or the Board of Governors of the Federal Reserve System.
(Mar. 9, 1933, ch. 1, title II, §210,
Statutory Notes and Related Subsidiaries
Change of Name
Act Aug. 23, 1935, ch. 614, title II, §203(a),
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§211. Rules and regulations
(a) In general
The Comptroller of the Currency may prescribe such rules and regulations as the Comptroller may deem necessary to carry out the provisions of this Act.
(b) F.D.I.C. as conservator
In any case in which the Federal Deposit Insurance Corporation is the conservator, any rules or regulations prescribed by the Comptroller shall be consistent with any rules and regulations prescribed by the Federal Deposit Insurance Corporation pursuant to the Federal Deposit Insurance Act [
(Mar. 9, 1933, ch. 1, title II, §211,
Editorial Notes
References in Text
This Act, referred to in subsec. (a), is act Mar. 9, 1933, ch. 1,
The Federal Deposit Insurance Act, referred to in subsec. (b), is act Sept. 21, 1950, ch. 967, §2,
Amendments
1989—
Executive Documents
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the Currency, referred to in this section, not included in transfer of functions to Secretary of the Treasury, see note set out under
§212. Right to amend; separability
The right to alter, amend, or repeal this Act is expressly reserved. If any provision of this Act, or the application there of to any person or circumstances, is held invalid, the remainder of the Act, and the application of such provision to other persons or circumstances, shall not be affected thereby.
(Mar. 9, 1933, ch. 1, title V, §502,
Editorial Notes
References in Text
This Act, referred to in text, is act Mar. 9, 1933, ch. 1,
Codification
This section was not enacted as part of title II of act Mar. 9, 1933, ch. 1,
§213. Transferred
Editorial Notes
Codification
Section, act Jan. 30, 1934, ch. 6, §13,
SUBCHAPTER XV—CONVERSION OF NATIONAL BANKS INTO STATE BANKS
§214. Definitions
(a) As used in this subchapter and
(b) For purposes of merger or consolidation under this subchapter and
(Aug. 17, 1950, ch. 729, §1,
Editorial Notes
Amendments
2006—Subsec. (a). Pub. L.
1954—Act Sept. 3, 1954, substituted "this subchapter and
Statutory Notes and Related Subsidiaries
Separability
Act Aug. 17, 1950, ch. 729, §9,
§214a. Procedure for conversion, merger, or consolidation; vote of stockholders
A national banking association may, by vote of the holders of at least two-thirds of each class of its capital stock, convert into, or merge or consolidate with, a State bank in the same State in which the national banking association is located, under a State charter, in the following manner:
(a) Approval of board of directors; publication of notice of stockholders' meeting; waiver of publication; notice by registered or certified mail
The plan of conversion, merger, or consolidation must be approved by a majority of the entire board of directors of the national banking association. The bank shall publish notice of the time, place, and object of the shareholders' meeting to act upon the plan, in some newspaper with general circulation in the place where the principal office of the national banking association is located, at least once a week for four consecutive weeks: Provided, That newspaper publication may be dispensed with entirely if waived by all the shareholders and in the case of a merger or consolidation one publication at least ten days before the meeting shall be sufficient if publication for four weeks is waived by holders of at least two-thirds of each class of capital stock and prior written consent of the Comptroller of the Currency is obtained. The national banking association shall send such notice to each shareholder of record by registered mail or by certified mail at least ten days prior to the meeting, which notice may be waived specifically by any shareholder.
(b) Rights of dissenting stockholders
A shareholder of a national banking association who votes against the conversion, merger, or consolidation, or who has given notice in writing to the bank at or prior to such meeting that he dissents from the plan, shall be entitled to receive in cash the value of the shares held by him, if and when the conversion, merger, or consolidation is consummated, upon written request made to the resulting State bank at any time before thirty days after the date of consummation of such conversion, merger, or consolidation, accompanied by the surrender of his stock certificates. The value of such shares shall be determined as of the date on which the shareholders' meeting was held authorizing the conversion, merger, or consolidation, by a committee of three persons, one to be selected by majority vote of the dissenting shareholders entitled to receive the value of their shares, one by the directors of the resulting State bank, and the third by the two so chosen. The valuation agreed upon by any two of three appraisers thus chosen shall govern; but, if the value so fixed shall not be satisfactory to any dissenting shareholder who has requested payment as provided herein, such shareholder may within five days after being notified of the appraised value of his shares appeal to the Comptroller of the Currency, who shall cause a reappraisal to be made, which shall be final and binding as to the value of the shares of the appellant. If, within ninety days from the date of consummation of the conversion, merger, or consolidation, for any reason one or more of the appraisers is not selected as herein provided, or the appraisers fail to determine the value of such shares, the Comptroller shall upon written request of any interested party, cause an appraisal to be made, which shall be final and binding on all parties. The expenses of the Comptroller in making the reappraisal, or the appraisal as the case may be, shall be paid by the resulting State bank. The plan of conversion, merger, or consolidation shall provide the manner of disposing of the shares of the resulting State bank not taken by the dissenting shareholders of the national banking association.
(Aug. 17, 1950, ch. 729, §2,
Editorial Notes
Amendments
1980—Subsec. (b).
1960—Subsec. (a).
§214b. Continuation of business and corporate entity
The franchise of a national banking association as a national banking association shall automatically terminate when its conversion into or its merger or consolidation with a State bank under a State charter is consummated and the resulting State bank shall be considered the same business and corporate entity as the national banking association, although as to rights, powers, and duties the resulting bank is a State bank. Any reference to such national banking association in any contract, will, or document shall be considered a reference to the State bank if not inconsistent with the provisions of the contract, will, or document or applicable law.
(Aug. 17, 1950, ch. 729, §3,
§214c. Conversions in contravention of State law
No conversion of a national banking association into a State bank or its merger or consolidation with a State bank shall take place under this subchapter and
(Aug. 17, 1950, ch. 729, §4,
Editorial Notes
Amendments
1954—Act Sept. 3, 1954, substituted "this subchapter and
1952—Act July 12, 1952, amended section so that the limitation of this section beyond which State law cannot go will be measured by the standard set out in
§214d. Prohibition on conversion
A national banking association may not convert to a State bank or State savings association during any period in which the national banking association is subject to a cease and desist order (or other formal enforcement order) issued by, or a memorandum of understanding entered into with, the Comptroller of the Currency with respect to a significant supervisory matter.
(Aug. 17, 1950, ch. 729, §10, as added
Statutory Notes and Related Subsidiaries
Effective Date
Section effective 1 day after July 21, 2010, except as otherwise provided, see section 4 of
SUBCHAPTER XVI—CONSOLIDATION AND MERGER
§215. Consolidation of banks within same State
(a) In general
Any national bank or any bank incorporated under the laws of any State may, with the approval of the Comptroller, be consolidated with one or more national banking associations located in the same State under the charter of a national banking association on such terms and conditions as may be lawfully agreed upon by a majority of the board of directors of each association or bank proposing to consolidate, and be ratified and confirmed by the affirmative vote of the shareholders of each such association or bank owning at least two-thirds of its capital stock outstanding, or by a greater proportion of such capital stock in the case of such State bank if the laws of the State where it is organized so require, at a meeting to be held on the call of the directors after publishing notice of the time, place, and object of the meeting for four consecutive weeks in a newspaper of general circulation published in the place where the association or bank is located, or, if there is no such newspaper, then in the paper of general circulation published nearest thereto, and after sending such notice to each shareholder of record by certified or registered mail at least ten days prior to the meeting, except to those shareholders who specifically waive notice, but any additional notice shall be given to the shareholders of such State bank which may be required by the laws of the State where it is organized. Publication of notice may be waived, in cases where the Comptroller determines that an emergency exists justifying such waiver, by unanimous action of the shareholders of the association or State bank.
(b) Liability of consolidated association; capital stock; dissenting shareholders
The consolidated association shall be liable for all liabilities of the respective consolidating banks or associations. The capital stock of such consolidated association shall not be less than that required under existing law for the organization of a national bank in the place in which it is located: Provided, That if such consolidation shall be voted for at such meetings by the necessary majorities of the shareholders of each association and State bank proposing to consolidate, and thereafter the consolidation shall be approved by the Comptroller, any shareholder of any of the associations or State banks so consolidated who has voted against such consolidation at the meeting of the association or bank of which he is a stockholder, or who has given notice in writing at or prior to such meeting to the presiding officer that he dissents from the plan of consolidation, shall be entitled to receive the value of the shares so held by him when such consolidation is approved by the Comptroller upon written request made to the consolidated association at any time before thirty days after the date of consummation of the consolidation, accompanied by the surrender of his stock certificates.
(c) Valuation of shares
The value of the shares of any dissenting shareholder shall be ascertained, as of the effective date of the consolidation, by an appraisal made by a committee of three persons, composed of (1) one selected by the vote of the holders of the majority of the stock, the owners of which are entitled to payment in cash; (2) one selected by the directors of the consolidated banking association; and (3) one selected by the two so selected. The valuation agreed upon by any two of the three appraisers shall govern. If the value so fixed shall not be satisfactory to any dissenting shareholder who has requested payment, that shareholder may, within five days after being notified of the appraised value of his shares, appeal to the Comptroller, who shall cause a reappraisal to be made which shall be final and binding as to the value of the shares of the appellant.
(d) Appraisal by Comptroller; expenses of consolidated association; sale and resale of shares; State appraisal and consolidation law
If, within ninety days from the date of consummation of the consolidation, for any reason one or more of the appraisers is not selected as herein provided, or the appraisers fail to determine the value of such shares, the Comptroller shall upon written request of any interested party cause an appraisal to be made which shall be final and binding on all parties. The expenses of the Comptroller in making the reappraisal or the appraisal, as the case may be, shall be paid by the consolidated banking association. The value of the shares ascertained shall be promptly paid to the dissenting shareholders by the consolidated banking association. Within thirty days after payment has been made to all dissenting shareholders as provided for in this section the shares of stock of the consolidated banking association which would have been delivered to such dissenting shareholders had they not requested payment shall be sold by the consolidated banking association at an advertised public auction, unless some other method of sale is approved by the Comptroller, and the consolidated banking association shall have the right to purchase any of such shares at such public auction, if it is the highest bidder therefor, for the purpose of reselling such shares within thirty days thereafter to such person or persons and at such price not less than par as its board of directors by resolution may determine. If the shares are sold at public auction at a price greater than the amount paid to the dissenting shareholders the excess in such sale price shall be paid to such shareholders. The appraisal of such shares of stock in any State bank shall be determined in the manner prescribed by the law of the State in such cases, rather than as provided in this section, if such provision is made in the State law; and no such consolidation shall be in contravention of the law of the State under which such bank is incorporated.
(e) Status of consolidated association; property rights and interests vested and held as fiduciary
The corporate existence of each of the consolidating banks or banking associations participating in such consolidation shall be merged into and continued in the consolidated national banking association and such consolidated national banking association shall be deemed to be the same corporation as each bank or banking association participating in the consolidation. All rights, franchises, and interests of the individual consolidating banks or banking associations in and to every type of property (real, personal, and mixed) and choses in action shall be transferred to and vested in the consolidated national banking association by virtue of such consolidation without any deed or other transfer. The consolidated national banking association, upon the consolidation and without any order or other action on the part of any court or otherwise, shall hold and enjoy all rights of property, franchises, and interests, including appointments, designations, and nominations, and all other rights and interests as trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, and receiver, and in every other fiduciary capacity, in the same manner and to the same extent as such rights, franchises, and interests were held or enjoyed by any one of the consolidating banks or banking associations at the time of consolidation, subject to the conditions hereinafter provided.
(f) Removal as fiduciary; discrimination
Where any consolidating bank or banking association, at the time of the consolidation, was acting under appointment of any court as trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, or receiver, or in any other fiduciary capacity, the consolidated national banking association shall be subject to removal by a court of competent jurisdiction in the same manner and to the same extent as was such consolidating bank or banking association prior to the consolidation. Nothing contained in this section shall be considered to impair in any manner the right of any court to remove the consolidated national banking association and to appoint in lieu thereof a substitute trustee, executor, or other fiduciary, except that such right shall not be exercised in such a manner as to discriminate against national banking associations, nor shall any consolidated national banking association be removed solely because of the fact that it is a national banking association.
(g) Issuance of stock by consolidated association; preemptive rights
Stock of the consolidated national banking association may be issued as provided by the terms of the consolidation agreement, free from any preemptive rights of the shareholders of the respective consolidating banks.
(Nov. 7, 1918, ch. 209, §2, formerly §1, as added
Editorial Notes
Codification
Provisions similar to those comprising this section were contained in sections 1 and 2 of act Nov. 7, 1918, ch. 209,
Amendments
2012—Subsec. (e).
Subsec. (f).
1994—
Statutory Notes and Related Subsidiaries
Short Title
Act Nov. 7, 1918, ch. 209, §1, as added by
§215a. Merger of national banks or State banks into national banks
(a) Approval of Comptroller, board and shareholders; merger agreement; notice; capital stock; liability of receiving association
One or more national banking associations or one or more State banks, with the approval of the Comptroller, under an agreement not inconsistent with this subchapter, may merge into a national banking association located within the same State, under the charter of the receiving association. The merger agreement shall—
(1) be agreed upon in writing by a majority of the board of directors of each association or State bank participating in the plan of merger;
(2) be ratified and confirmed by the affirmative vote of the shareholders of each such association or State bank owning at least two-thirds of its capital stock outstanding, or by a greater proportion of such capital stock in the case of a State bank if the laws of the State where it is organized so require, at a meeting to be held on the call of the directors, after publishing notice of the time, place, and object of the meeting for four consecutive weeks in a newspaper of general circulation published in the place where the association or State bank is located, or, if there is no such newspaper, then in the newspaper of general circulation published nearest thereto, and after sending such notice to each shareholder of record by certified or registered mail at least ten days prior to the meeting, except to those shareholders who specifically waive notice, but any additional notice shall be given to the shareholders of such State bank which may be required by the laws of the State where it is organized. Publication of notice may be waived, in cases where the Comptroller determines that an emergency exists justifying such waiver, by unanimous action of the shareholders of the association or State banks;
(3) specify the amount of the capital stock of the receiving association, which shall not be less than that required under existing law for the organization of a national bank in the place in which it is located and which will be outstanding upon completion of the merger, the amount of stock (if any) to be allocated, and cash (if any) to be paid, to the shareholders of the association or State bank being merged into the receiving association; and
(4) provide that the receiving association shall be liable for all liabilities of the association or State bank being merged into the receiving association.
(b) Dissenting shareholders
If a merger shall be voted for at the called meetings by the necessary majorities of the shareholders of each association or State bank participating in the plan of merger, and thereafter the merger shall be approved by the Comptroller, any shareholder of any association or State bank to be merged into the receiving association who has voted against such merger at the meeting of the association or bank of which he is a stockholder, or has given notice in writing at or prior to such meeting to the presiding officer that he dissents from the plan of merger, shall be entitled to receive the value of the shares so held by him when such merger shall be approved by the Comptroller upon written request made to the receiving association at any time before thirty days after the date of consummation of the merger, accompanied by the surrender of his stock certificates.
(c) Valuation of shares
The value of the shares of any dissenting shareholder shall be ascertained, as of the effective date of the merger, by an appraisal made by a committee of three persons, composed of (1) one selected by the vote of the holders of the majority of the stock, the owners of which are entitled to payment in cash; (2) one selected by the directors of the receiving association; and (3) one selected by the two so selected. The valuation agreed upon by any two of the three appraisers shall govern. If the value so fixed shall not be satisfactory to any dissenting shareholder who has requested payment, that shareholder may, within five days after being notified of the appraised value of his shares, appeal to the Comptroller, who shall cause a reappraisal to be made which shall be final and binding as to the value of the shares of the appellant.
(d) Application to shareholders of merging associations: appraisal by Comptroller; expenses of receiving association; sale and resale of shares; State appraisal and merger law
If, within ninety days from the date of consummation of the merger, for any reason one or more of the appraisers is not selected as herein provided, or the appraisers fail to determine the value of such shares, the Comptroller shall upon written request of any interested party cause an appraisal to be made which shall be final and binding on all parties. The expenses of the Comptroller in making the reappraisal or the appraisal, as the case may be, shall be paid by the receiving association. The value of the shares ascertained shall be promptly paid to the dissenting shareholders by the receiving association. The shares of stock of the receiving association which would have been delivered to such dissenting shareholders had they not requested payment shall be sold by the receiving association at an advertised public auction, and the receiving association shall have the right to purchase any of such shares at such public auction, if it is the highest bidder therefor, for the purpose of reselling such shares within thirty days thereafter to such person or persons and at such price not less than par as its board of directors by resolution may determine. If the shares are sold at public auction at a price greater than the amount paid to the dissenting shareholders, the excess in such sale price shall be paid to such dissenting shareholders. The appraisal of such shares of stock in any State bank shall be determined in the manner prescribed by the law of the State in such cases, rather than as provided in this section, if such provision is made in the State law; and no such merger shall be in contravention of the law of the State under which such bank is incorporated. The provisions of this subsection shall apply only to shareholders of (and stock owned by them in) a bank or association being merged into the receiving association.
(e) Status of receiving association; property rights and interests vested and held as fiduciary
The corporate existence of each of the merging banks or banking associations participating in such merger shall be merged into and continued in the receiving association and such receiving association shall be deemed to be the same corporation as each bank or banking association participating in the merger. All rights, franchises, and interests of the individual merging banks or banking associations in and to every type of property (real, personal, and mixed) and choses in action shall be transferred to and vested in the receiving association by virtue of such merger without any deed or other transfer. The receiving association, upon the merger and without any order or other action on the part of any court or otherwise, shall hold and enjoy all rights of property, franchises, and interests, including appointments, designations, and nominations, and all other rights and interests as trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, and receiver, and in every other fiduciary capacity, in the same manner and to the same extent as such rights, franchises, and interests were held or enjoyed by any one of the merging banks or banking associations at the time of the merger, subject to the conditions hereinafter provided.
(f) Removal as fiduciary; discrimination
Where any merging bank or banking association, at the time of the merger, was acting under appointment of any court as trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, or receiver, or in any other fiduciary capacity, the receiving association shall be subject to removal by a court of competent jurisdiction in the same manner and to the same extent as was such merging bank or banking association prior to the merger. Nothing contained in this section shall be considered to impair in any manner the right of any court to remove the receiving association and to appoint in lieu thereof a substitute trustee, executor, or other fiduciary, except that such right shall not be exercised in such a manner as to discriminate against national banking associations, nor shall any receiving association be removed solely because of the fact that it is a national banking association.
(g) Issuance of stock by receiving association; preemptive rights
Stock of the receiving association may be issued as provided by the terms of the merger agreement, free from any preemptive rights of the shareholders of the respective merging banks.
(Nov. 7, 1918, ch. 209, §3, formerly §2, as added
Editorial Notes
Codification
Provisions similar to those comprising this section were contained in section 4 of act Nov. 7, 1918, ch. 209, as added July 14, 1952, ch. 722, §1,
Amendments
2012—Subsec. (e).
Subsec. (f).
§215a–1. Interstate consolidations and mergers
(a) In general
A national bank may engage in a consolidation or merger under this subchapter with an out-of-State bank if the consolidation or merger is approved pursuant to
(b) Scope of application
Subsection (a) shall not apply with respect to any consolidation or merger before June 1, 1997, unless the home State of each bank involved in the transaction has in effect a law described in
(c) Definitions
The terms "home State" and "out-of-State bank" have the same meaning as in section 1831u(f) 1 of this title.
(Nov. 7, 1918, ch. 209, §4, as added
Editorial Notes
References in Text
1 See References in Text note below.
§215a–2. Expedited procedures for certain reorganizations
(a) In general
A national bank may, with the approval of the Comptroller, pursuant to rules and regulations promulgated by the Comptroller, and upon the affirmative vote of the shareholders of such bank owning at least two-thirds of its capital stock outstanding, reorganize so as to become a subsidiary of a bank holding company or of a company that will, upon consummation of such reorganization, become a bank holding company.
(b) Reorganization plan
A reorganization authorized under subsection (a) shall be carried out in accordance with a reorganization plan that—
(1) specifies the manner in which the reorganization shall be carried out;
(2) is approved by a majority of the entire board of directors of the national bank;
(3) specifies—
(A) the amount of cash or securities of the bank holding company, or both, or other consideration to be paid to the shareholders of the reorganizing bank in exchange for their shares of stock of the bank;
(B) the date as of which the rights of each shareholder to participate in such exchange will be determined; and
(C) the manner in which the exchange will be carried out; and
(4) is submitted to the shareholders of the reorganizing bank at a meeting to be held on the call of the directors in accordance with the procedures prescribed in connection with a merger of a national bank under
(c) Rights of dissenting shareholders
If, pursuant to this section, a reorganization plan has been approved by the shareholders and the Comptroller, any shareholder of the bank who has voted against the reorganization at the meeting referred to in subsection (b)(4), or has given notice in writing at or prior to that meeting to the presiding officer that the shareholder dissents from the reorganization plan, shall be entitled to receive the value of his or her shares, as provided by
(d) Effect of reorganization
The corporate existence of a national bank that reorganizes in accordance with this section shall not be deemed to have been affected in any way by reason of such reorganization.
(e) Approval under the Bank Holding Company Act
This section does not affect in any way the applicability of the Bank Holding Company Act of 1956 [
(Nov. 7, 1918, ch. 209, §5, as added
Editorial Notes
References in Text
The Bank Holding Company Act of 1956, referred to in subsec. (e), is act May 9, 1956, ch. 240,
§215a–3. Mergers and consolidations with subsidiaries and nonbank affiliates
(a) In general
Upon the approval of the Comptroller, a national bank may merge with one or more of its nonbank subsidiaries or affiliates.
(b) Scope
Nothing in this section shall be construed—
(1) to affect the applicability of
(2) to grant a national bank any power or authority that is not permissible for a national bank under other applicable provisions of law.
(c) Regulations
The Comptroller shall promulgate regulations to implement this section.
(Nov. 7, 1918, ch. 209, §6, as added
§215b. Definitions
As used in this subchapter, the term—
(1) "State bank" means any bank, banking association, trust company, savings bank (other than a mutual savings bank), or other banking institution which is engaged in the business of receiving deposits and which is incorporated under the laws of any State, or which is operating under the Code of Law for the District of Columbia;
(2) "State" means the several States and Territories, the Commonwealth of Puerto Rico, the Virgin Islands, and the District of Columbia;
(3) "Comptroller" means the Comptroller of the Currency; and
(4) "Receiving association" means the national banking association into which one or more national banking associations or one or more State banks, located within the same State, merge.
(Nov. 7, 1918, ch. 209, §7, formerly §3, as added
Editorial Notes
Codification
Provisions similar to those comprising this section were contained in section 5 of act Nov. 7, 1918, ch. 209, as added July 14, 1952, ch. 722, §1,
Amendments
2006—Par. (1). Pub. L.
§215c. Mergers, consolidations, and other acquisitions authorized
(a) In general
Subject to sections 1815(d)(3) 1 and 1828(c) of this title and all other applicable laws, any national bank may acquire or be acquired by any insured depository institution.
(b) Expedited approval of acquisitions
(1) In general
Any application by a national bank to acquire or be acquired by another insured depository institution which is required to be filed with the Comptroller of the Currency under any applicable law or regulation shall be approved or disapproved in writing by the agency before the end of the 60-day period beginning on the date such application is filed with the agency.
(2) Extensions of period
The period for approval or disapproval referred to in paragraph (1) may be extended for an additional 30-day period if the Comptroller of the Currency determines that—
(A) an applicant has not furnished all of the information required to be submitted; or
(B) in the Comptroller's judgment, any material information submitted is substantially inaccurate or incomplete.
(c) Rule of construction
No provision of this section shall be construed as authorizing a national bank or a subsidiary of a national bank to engage in any activity not otherwise authorized under this Act 1 or any other law governing the powers of national banks.
(d) "Acquire" defined
For purposes of this section, the term "acquire" means to acquire, directly or indirectly, ownership or control through a merger or consolidation or an acquisition of assets or assumption of liabilities, provided that following such merger, consolidation, or acquisition, an acquiring insured depository institution may not own the shares of the acquired insured depository institution.
(R.S. §5156A, as added
Editorial Notes
References in Text
This Act, referred to in subsec. (c), probably means the National Bank Act, act June 3, 1864, ch. 106,
Codification
Section was not enacted as part of act Nov. 7, 1918, ch. 209, as added Sept. 8, 1959,
Amendments
1996—Subsec. (b)(1).
1 See References in Text note below.
SUBCHAPTER XVII—DISPOSITION OF UNCLAIMED PROPERTY RECOVERED FROM CLOSED NATIONAL BANKS
§216. Purpose
The purpose of this subchapter is to dispose of unclaimed property in the possession, custody, or control of the Comptroller of the Currency by—
(1) providing final notice of the availability of unclaimed property from closed national banks;
(2) barring rights of claimants to obtain such property from the Comptroller after a reasonable period of time following such notice; and
(3) authorizing the Comptroller to dispose of such property for which no claims have been filed and validated under this subchapter.
(
Editorial Notes
Amendments
2006—Par. (1). Pub. L.
§216a. Definitions
For purposes of this subchapter—
(1) the term "Comptroller" means the Comptroller of the Currency;
(2) the term "unclaimed property" means any articles, items, assets, other property, or the proceeds thereof from safe deposit boxes or other safekeeping arrangements with closed national banks, which are in the possession, custody, or control of the Comptroller in its capacity as successor to receivers of those banks; and
(3) the term "claimant" means any person or entity, including a State under applicable statutory law, asserting a demonstrable legal interest in title to, or custody or possession of, unclaimed property.
(
Editorial Notes
Amendments
2006—Par. (2). Pub. L.
§216b. Disposition of unclaimed property
(a) Limitations for filing claims; publication of notice in Federal Register; contents of notice; disclosure of descriptive information; inspection of specific property
(1) Within twelve months following October 15, 1982, the Comptroller shall publish formal notice in the Federal Register that all claims to rights of any claimant to obtain title to, or custody or possession of, any unclaimed property in the possession, custody, or control of the Comptroller must be filed within twelve months following the last date of publication of such formal notice in the Federal Register or shall thereafter be barred.
(2) Such notice shall contain the names of last known owners, if any, names and locations of affected closed banks, and a general description of the types of unclaimed property held by the Comptroller. The Comptroller may provide additional notice in local communities as it deems appropriate.
(3)(A) The Comptroller shall not disclose, by publication, inspection or otherwise, information relating to the ownership or description of any specific unclaimed property prior to publication of formal notice under this section.
(B) Thereafter, the Comptroller shall disclose descriptive information of specific unclaimed property only to a claimant thereof. The Comptroller may recoup expenses associated with any publication or other provision of notice from any sale of property authorized by this subchapter. Reasonable opportunity for inspection of specific property by a claimant thereof shall be provided in Washington, District of Columbia.
(b) Delivery of property to claimant upon proof of entitlement; determination of validity of claims; recoupment of expenses; liability for losses; insurance requirements
(1) The Comptroller shall deliver such property to any claimant or his or her legally authorized representative upon receiving proof deemed adequate by the Comptroller that such claimant is entitled to the property, but only if the claimant files for the property within twelve months following the last date formal notice is published in the Federal Register.
(2)(A) The Comptroller shall have authority to determine the validity of all claims filed. The Comptroller may recoup expenses associated with the handling and processing of claims from any sale of property authorized by this subchapter.
(B) All expenses associated with the delivery of any property shall be borne by the claimant. The Comptroller shall not be responsible for any loss in connection with the handling, storage, or delivery of any property to the claimant. The Comptroller may require the claimant to purchase insurance to cover the risk of any loss.
(c) Vesting of rights, title and interest in unclaimed property in United States; sale, use, destruction or disposition of property; proceeds of sale as miscellaneous receipts
(1) If, after twelve months from the date formal notice is published in the Federal Register, any such property remains in the possession, custody, or control of the Comptroller for which no valid claim has been filed, all rights, title, and interest in such property shall immediately be vested in the United States.
(2) The Comptroller shall thereupon, in his discretion, sell, use, destroy, or otherwise dispose of any such unclaimed property. Such disposition may include donations to the Smithsonian Institution for addition to the national collection.
(3) The proceeds of any sale authorized by this section, after recoupment by the Comptroller of any expenses incurred hereunder, shall be covered into the Treasury as miscellaneous receipts.
(d) Liability for determination of validity of claims; liability for delivery, sale, etc., of property
The United States, the Comptroller, or any officer, employee, or agent thereof shall not be subject to personal or legal liability for any determination as to the validity of any claim or claims filed under this subchapter or for any delivery, sale, destruction, or other disposition of unclaimed property.
(e) Court action for determination of ownership, etc., in State or Federal court of competent jurisdiction; de novo nature of action; parties
(1) A court action to determine legal ownership, entitlement, or right to possession may be filed in any State or Federal court of competent jurisdiction other than against the United States, the Comptroller, or any officer, agent, or employee thereof.
(2) Such actions shall be determined de novo without regard to any agency determination or any disposition or delivery by the Comptroller of any particular property to any person.
(3) The United States, the Comptroller, or any officer, employee, or agent thereof shall neither be a party to any such judicial proceeding nor be bound by any decision, decree, or order resulting therefrom.
(f) Jurisdiction of United States Court of Federal Claims of actions against United States, Comptroller, officer, etc.; scope of review of actions of Comptroller; limitations; claims against Comptroller, officer, etc., as claim against United States
(1) The United States Court of Federal Claims shall have exclusive jurisdiction to hear and determine any suit brought against the United States, the Comptroller, or any officer, employee, or agent thereof with regard to any determination of a claim or the disposition of any unclaimed property.
(2) The United States Court of Federal Claims may set aside actions of the Comptroller only if such actions are found to be arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.
(3) All claims for which the United States Court of Federal Claims has jurisdiction under this subsection shall be barred unless suit is filed within two years from the date of expiration of the twelve-month notice period provided by this subchapter.
(4) For purposes of
(
Editorial Notes
Amendments
1992—Subsec. (f)(1) to (3).
Statutory Notes and Related Subsidiaries
Effective Date of 1992 Amendment
Amendment by
1 So in original. Probably should not be capitalized.
§216c. Rules and regulations
The Comptroller may issue rules and regulations necessary or appropriate to carry out this subchapter.
(
§216d. Severability
If any provision of this subchapter or the application of such provision to any person or circumstance is held invalid, the remainder of this subchapter and the application of such provision to other persons or circumstances shall not be affected thereby.
(