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r https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis MATERIALS REGARDING DEPOSIT GUARANTY IN MISSISSIPPI, 1914-3O MISSISSIPPI Additional material can be found in the following folders filed with this binder: Statistical analysis - Mississippi deposit guaranty fund Data for failed banks Operation of fund https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 3.)? , Y2_ 2,3; LI 3 ft 3Z e6, 27 2) .)-4/ 1,-Y/ , 0, - 01.2,r)C,•-• 64544.„ tt\ cr-t_ O ) ', ‘itA.A v o'N r k .1.ke., _ `", C.) \.,."-LIV`‘,"NA--. f 2// Puy ,5;.,,,,c;.vcf,19/.17 • v---7 tt-N.A • C I ; -LL7 ,\ " /4)-\ _ 1;\ https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis I 1 A ki,„„ /,1,4--(41,,., x s A, cL t ,, ( , ' V\1 if 31 tb I firl y S AP(Yt• Avv.V\ https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis • I _( Lt C„,:c 1 L.,t ç c/z- , / r \ftt-' Jar' 5k5") C4 t rt https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis - Co•-, , N evkl\A) V2A-, li\x) 1,1•4rAik CIAAL,-\Q,A Divwk https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis , \AJA-1 WLOAAI V. P•L'ir--4 A tv•fLTI'svA frl/trW k 125 I „ kt, ( (r1 itA ' \ tj Ci-L3AA-tt // - P/514 Adkj 14-‘- •ri‘Ar- St) https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis ‘s _jd qc A/t -ad-, 1 6 inn" art) " r f MATERIALS REGARDING DEPOSIT GUARANTY IN MISSISSIPPI, 1914-30 ( /1 , 24 '4 , c,44e—,,ezT77 eC1-4,4,4et-c-ige./ et,c-e-e .r d_c_r‘tvi S ' ''. ...F. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis • MISSISSIPPI Laws and law cases Session Laws: xildifxgkxxiitix 1914 (extra session of 1913), ch. 124 1916, ch. 207 1918, chs. 166, 247, and 248. 1920, chs. 187 and 192. 1922, ch. 172. 1924, chs. 175 and 176. 1928, ch. 94. 1930, ch. 22. kgnixt 1931 (extraordinary session), 12 1932, ch. 282. 1934, ch. 146. • 19°6, ch. 14. 1918, 1920, 1922, 1924, 1926, chs. 153, 158, and 165 chs. 183-86, and 188-89. chs. 173-74, and 176-77. chs. 172-74. chs. 247-252. 1928, chs. 93. 1930, ch. 269. 1932, chs. 251, 301, and 336. State Supreme Court: Anderson, State Bank Examiner v. Badkin & Wilbourn;(1917), 114 Miss. 81, 74 So. 682. Anderson et al., Bank Examiners v. Owne et al. (1916), 112 Miss. 476, 73 so. 286. Bank of Oxford v. Love et al.(1916), 111 Miss. 699, 72 So. 133. Board of Levee Com'rs. v. Love, Supt of Banks (1927), 147 Miss. 183, 113 So. 335. City of Jackson v. Deposit Guarnaty Bank & Trust Co. (1931), 160 Miss. 752, 133 So 195. Johnson, State Bank Examiner v. Johnson (1924), 134 Miss. 729, 99 so. 369. Love, Supt of Banks v. Citizens Bank and Trust Co. of Marks (1925), 140 Miss. 585, 105 So. 484. Love, Supt of Banks v. Murry, State Treasurer#1924), 135 Miss. 749, S. So. 277. Mississippi Banking Department et al. v. Adams/4924), 127 Miss. 122, 102 So. 70. Wardlaw, State Bank Examiner v. Rat Planters' Bank of Clarksdale, et al. (1923), 131 Miss. 93, 95 So. 135. United States Supreme Court: Bank of Oxford et al. v. Love et al., Bank Eynminers of the State of Mississippi (1919), 250 U.S. 603, 63 L. Ed. 1165. 0 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis State Documents Auditor of PUblic Accounts, Reports of the Auditor of Public Accounts. State Comptroller:. Biennial Reports of the Banking Department of the State of Mississippi, . 1924=25-TI96-27, 1928-29, 1931-33. / " Biennial Reports of the Department of Bank Supervision, 1934-35 and 1951-53. Statements for Individual Banks. Statements showing the condition of State and National Banks in Mississippi, 1914-1930. Other Publications and Manuscripts 7 Cooke, Thornton. "Deposit Guaralty in Mississippi," Quarterly Journal of Economics, XXIV (February 1915). Butts, A. B. "State REgulation of Banking by Guaranty of Deposits, Mississippi Law Journal, II (November 1929), ' knxmoi Love, J. S. "A Year of State Bank Supervision," Mississippi Banker May 1915, . Interview, October 22, 1934. _AL„Ndssissippi Banker, 1-20 (1914-1936). ' Spencer, E. O. Interview, January 16, 1956. Southern Banker, 52-64 (1929-1935). • https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis -lank of Ox ford v. Love et al., 111 Miss 699, 72 So. 133 ( 4nnk of Oxford et al. v. Love et al., Bank Examiners of__Vie State of Mississippi, 250 U.S. 603. (19/ 3 ia4erson et al., Bank Examiners v. Cline et al., 112 Miss. 476, 73 So 286. 4 iiimson, State Bank Examiner v. Johnson, 134 Miss 729, 99 So 369. /6-Wftrellaw, State Bank Examiner v. Planters Bank of Clarksdale, et al., 131 Miss. 93, 95 So. 135.-/ ( 5 -Love Supt. of Banks v. Murry, State Treasurer, 135 Miss. 749, 100 So. 277/9AP 7 Lalsy. Supt. of Banks, v. Citizens Bank and Trust Co. of Marks, 140 Miss. 585, 105 So. 484. 2 v. Love, Supt of Banks, 147 Miss 1$3, 113 So. 335./701 Colliers. 0-46.1oard of Levee 41 ?__Mississippi Banking Department et al. v. Adams, 127 Miss. 122, 102 So. 70./9 Y/ Anderson, State Bank Examiner v. Baskin & Wilbourn, 114 Miss. 81, 74 So. 682. /j7/7 -etty- of Jackson v. Deposit Guaranty Bank & Trust C., if. 133 *V So. 195, 160 Miss. 752 (March 23 , 1941). rd-44:34-344 z ... ,.< er- i erri / 93 1 , Lays 1934 ch. 146. / y.4.6 eL //Z '-:,./ ' '' '`.4-(''.--' /,/a (-t36 2 c),07 e, , / 9/6 /?f, /9." ,Z 4/7 // /1:85./... / 4.--/-k_ / cg, /.47; .,74.4e /et'i /PI, /f-z, • e'it /efSj /e-,--- /fl / 7Z/7.0 -af ) )/ 74 fia-2 - /7,2. i70, 5/- I ,- x; /14, /73, / Iff, /i-- /f • /fc;g6 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 7).Y‘ 41-4-79 . /t' SSISSIPPI (References to periodicals) Cooke, Thornton. "Deposit Guaranty in Mississippi," Quarterly Journal of Economics, XXIV (February 1915). Butts, A. B. "State Regulation of Banking By Guaranty of Deposits," Law Journal, II (November 1929). 'Love, J. S. "A Year of State Bank Supervision," Mississippi Mississippi Banker, May 1915. (References to publications and records of the State of Mississippi) I, Auditor of Public Accounts, Reports of the Auditor of Public Accounts. cr? ioe...ee Rank-114e, Dtiliti-tmt Biennial Reports of the Banking Department of the State of Mississippi 4 4*c 924:1925' 926-1927' 1 1928-1929. i 1931..1933 Y 1 I / Statements for individual banks. of condition State banks in National Mississippi, and foree tatements showing the 1931.' .. .partment of Bank Supervision Biennial Reports of the Department of Bank Supervision, 1934-1935 and 1951-1953. Statements r Mississippi State Legislature, Laws of 1934. sources (References to other matextats) N/Love, J. S. Interview, October 22, 1934. IMississippi Banker Qilyvembe // Anuary 1916. ---(41y 1931. 4 qSpencer, E. O. 2.--2-2 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis - ,•/ Interview, January 16, 1956. -if36 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis • https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis From Index to Mississippi Annotated Code 1906 - items relating to Banks and Banking and to Interest • " • BANKS AND BANKING Athapter 16.0:0%6 '1 S ikf 4.!,1 Bank not to permit use of name to third persons - penalty for use 26" "Bank" or "Banking," to appear in name of all incorporated banks not to be used by others 2uu liBank statements--who required to make--general regulations-publication 256 when made--penalty for failure 257-8 Arancl, banks--restrictions upon organization 260 261 minimum capital /6riminal law--appropriating assets, or receiving deposits when 1169 bank is insolvent 1141 Kembezzlement by bank officer 259 Deposits of deceased persons--penalty for failure to make statement 262 /Directors' meetings--regulations concerning 4852 Drafts with bills of lading attached--retention of money for a day 2677 Interest and discount--rate--usury- recovery back 922 Limitation on loans to one person, firm, etc 922 Loan to officer or director--liability of official making illegal loan 3119 Statute of limitations not to apply to notes, bills, etc., of 4273 Taxation--capital stock how turned in--surplus--shares--valuation 4275 real estate--how taxed 4274 when to be paid--penalty 4259 where assessed--branches wilful failure to render, or making false or incomplete return, 1048 a misdemeanor 263 Trust companies--how bank can become one 264 duties and powers of 265 mutual loan department--general regulations concerning 266 to use "Trust" in name--not to be used by others 2679 Usury--recovery back INTEREST (Chapter 70) Banks--interest and discount--usury--recovery back Judgments and decrees--rates of interest on Legal rate--forfeiture of interest for usury Partial payments--application of payments • https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 2679 2680 2678 2681 Wgo SET Trm • ,r)7TS':70 77,1— —7.7 r1 -,7 """ C7 rolotir. - to barkc H attached eoocootrroo. "h -, v' or quoted 2 Mr' Code of 1.'96 are irdi-ated by the iton arc ru-rorlzed Code. On7- 7oc. 6. andev - "7 person, corporation or association cts Lor of norsphs receiving ooney on depos'ot, oo issuine-, buying or selling exchanoe, or otherwise doino a hnaLin husiness, sl;a7t1 "ado a Wancod statorert, ord -oath of the ooner„ or one or Tore o' the cfficers of the bark, to the auditor of pulo7ic accounts, at least forr times 'r each year of tho -erdotr'on of the bank or bus].ross, showing the resources and liahilities ti 'roof, and the amount of the indeloodness to the bank which. is owing hy its 7-,T.ole-rs ors tockholders and otficers and diroctors, on ':lark for .orescrihod 1-7" the auditor, and ir duplicate. On receioinF: the statement, the auditor shall examine it, and, if found correct, shall file one cony and return the other to the ban:, indorsed "Examined and foord correct," and the bank shal thereupon, within ten days, cause the same to be published, with the endorsement of to auditor, at its own exTense, in a newspaper published at the place of domicile of the bank, or, if there by none so oublished, in a convenient newspaper having a circulaMon r such place. Secs. 260-261 re branch banks - • see notes on 1917 code - identieil Sec. 262 Requires three regular met:rip each calendar year of the hoard of directore of every bank "for the purpose of making a full and careful iry7stioation and 1-!viry into the conditlor end affairs of the hank, and particularly of its accounts aR securities." Requires accurate and complete record of duch reetine, signed e directorsA participating. Sec. 11111. "If any .... bank or colloctro a7ent...sha1 1 unlawThlly cenvert to his own use any none: or valuaie thinF7..." Provides Penalty. Sec. 1169. If the president, ranaoer, cashier, teller, assistant, clyk, or other employe or aoent of any bank or broker's office or Establishrent conduting the lousiness of receiving on deposit the money or other valuable things of such persons, shall remove or secrete or conceal the assets or effects or such establishment for the nurpose of defrauding any of the creditors of the establishment, or shall receive slay deposit knowing, or having good reason to believe, the establishment to be insolvent, without informing the depositor of such condition, on cerviction, he shall he imprisoned ]n the penitentiary not loner t: an five years." Sec. 2678. Legal -ate of interest for interst as _roat as ten percent. may be recovered. --cent, but contracts may be made in writing Any greater intcrest stipulated or received F. 2679. Applies this laL;a1 rate of interest to banks, with contracts providing and the whole of mazia the iter st or discount provided for Ijer rates invalid, void and subject to recovery by the debtor. oto Sec. Lool. payrent. Partial payments to be ai);lied first to interest accrued to time of Sec. 3119. None of the provisions of this chapter shall apply to suits brought to enforce rayment of notes, bills, or evidences of debt issued by any bank or moneyed oorporatIon. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis S FORCE PRIO Te _ T- '79STSSIPPI 197!; 1:21 (Prepared from The Annotated 71 ssissippi Code showine the general force August 1, 1917, embracine the code of 1906 as amended and all general and public acts ef the lresislature passed since the adoption code...by William Hemingway (Indianapolis, The -3obbs-Yereill Company, Note. The tanktn: Lawef 1914 did not repeal any former laws, except as decisions later indicated that such was the effect. Consequently, it ha_L e assumed that th ftc1Rons of "Chapter 82 Banks",(pp. 1829-1e67), which c _ sections 3520-3M! not referrimc to the L ,w of 191)4 or that of 1916 were the ` full bankin - code prior to the act of 191):, ch. 124. All sections that do not refer to the law of 1911 or of 1916 are listed below, with the subject, but are quo e or. eynty iposit eear Tnzed only, erhen thoe -htdesirabie for use in connection ,14 ith de u A GSN #64410•14., ,re study. r.\ j10 , eplee 3520.. Dep sits of deceased pers ns--Te whee -ele;-- e vii.lerreeff 3521. "Branch banks--Restrictions upon orLaneeaLLee. 1 ,e er,eeteee el' eegani_aL_ ' )f any anch 'ank in this state after this chapter 4pcsi eto effect sW.1 1,e rbidden and prohibited, and no branch hank shall. be thereafter ez 'ame is i,ate, and no parent bank chartered under the laws of this state ehnll n thisbi7 hereafter establish any branch bank either within cr -ithout the s tate.r • °522. "Branch banks--Minimum capital to be employed. Every parent bank operatine me or more branch banks s all set apart and devote from its capital a sum not leF.the exclusive use of each of said branch hanks in that ten thousand dollars business, and the amount o the capital of the parent bank employed by each branc. bank shall never at any time be less than the mid amount of ten tho .sand dollars." • https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 1.= st,t7tafrarrYlr e • • https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis * • From - Laws of Mississippi 1914 - Extra. Session 1913 - pp. 1r7-141 CHAPThH 124. SENATE BILL NO. 48. AN ACT establishing a banking department for the State of Mississippi, creating a board of bank commissioners, prescribing their qualifications, duties, and compensation, providing for the election of State bank examiners, prescribing their qualifications, duties and compensation, defining what shall constitute a bank and banking business in the State of Mississippi, fixing the capital required to do a banking business, and providing for the examination, regulation and control of banks and banking business conducted by corporations, other thanrational banks and postal savings banks and fixing the assessment for the revenues of the department, fixing qualifications and liability of officers, stockholders and directors of banking corporations; fixing the qualifications and liability of persons, firms and corporations in the banking business; providing for the payment of deposits to minors and other persons under disability and on join account; prohibiting banking except under the provisions of this act; providing for the liquidation of banks and the distribution of the assets thereof; providing for giving publicity to deposits more than five years old; and prescribing penalties for the breach of any of the provisions thereof, and to provide a system for guaranteeing deposits, and for other purposes, without expense to the State. State department of banking created. Be it enacted by the Legislature of the State of Mississippi. Section 1. Establishment of State banking department. There is hereby created a banking department of the State government charged with the execution of all laws relating to corporations and individuals doing or carrying on a banking business in the State of Mississippi. The office of said department shall be located in the city of Jackson, and the secretary of state shall provide suitable quarters therefor. Three bank examiners to be elected by supreme court districts. Sec. 2. There shall be a board of bank examiners consisting of three members who shall choose from among themselves a chairman, and a majority of whom may for all purposes act for the board, and who shall be elected, one by and from each supreme court district at the time and in the manner that State officers are elected, and whose term of office shall be four years and until their successors shall qualify. Who eligible to become a bank examiner. a Sec. 3. Qualifications. No person shall be eligible to become a bank examiner who is not a qualified elector; thirty years of age; a practical accountant; who does not thoroughly understand the theory and practice of banking; who has been manager or otherwise in control of any banking institution or other business enterprise which has failed or liquidated its debts https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis -2- • below par during such management, or who has not secured a license to become a candidate for said office as hereinafter provided. No person while occupying the position of bank examiner shall be employed by or have any interest in any bank or banking business within the State, and any violation of this provision shall, ipso facto, make vacant the office. Examiners to take oath of office and give $25,000.00 bonds. Each bank examiner shall, before entering upon the discharge of his duties, take and subscribe the oath of office prescribed by section 268 of the constitution of Mississippi, and file the same in the office of the secretary of state, and shall execute to the State of Mississippi a bond to be approved by the governor and filed with the secretary of state, in the penal sum of twenty-five thousand dollars, in some surety company authorized to do business in this State, conditioned for the faithful and impartial discharge of the duties of said office, and for the payment of any and all damages and costs that may be adjudged against him under the provisions of this act, and for the faithful and proper handling and accounting for all monies that come into his hands under the provisions of this act. Commission to examine credentials for bank examiner. Sec. 4. Exsminina board of bank examiners. There shall be a board of t bank commissioners, consisting of three members, for examining candidates for bank examiners, who shall be appointed within ten days after the passage of this act and every four years thereafter, as follows: One by the governor, who shall be a successful banker and business man; one by the attorray general, who shall be an experienced lawyer; and one by the auditor, who shall be an experienced accountant; all of whom shall be not less than thirty years old and qualified electors; and their terms of office shall be for four years, and until their successors shall qualify. Vacancy in board; how filled. If any vacancy shall occur in the board of bank commissioners, by reason of resignation or otherwise, it shall forthwith be filled by appointment by the officer appointing his predecessor. When candidates to be examined. The board of bank commissioners shall ?nee. * the office of the banking department on the first Monday in March preceding the general election in November, then and there to hold an examination for candidates for bank examiners. Applicants for examination to file notice and pay fee; candidate license issued. Any person or persons upon giving written notice to the chairman of the board of bank commissioners and upon the payment of the sum of fifty dollars each to the State treasurer for the credit of the banking fund shall be given a special examination at which a license or licenses to become a candidate for election to the office of bank examiner may be granted as in regular https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis -3 • examinations, and said chairman shall call a meeting for the purpose of giving said special examination not later than thirty days after receipt of said notice and shall give the applicant or applicants due notice thereof. Compensation of bank commissioners; how paid. The members of the board of bank commissioners shall be allowed their actual expenses, and a per diem of five dollars while in the actual discharge of their duties, to be paid out of the banking fund in the same manner as the salaries and expenses of the members of the board of bank examiners. How examinations held; subjects for same; strict secrecy enjoined. • Sec. 5. Examination for licenses and vacancies, how filled. No person shall be eligible to hold the position of bank examin:r, either by election or otherwise until he shall have been issued a license or certificate through competitive examination by the board of bank commissioners. Said bank commissioners shall hold a written examination in the office of the banking department on the subjecOf accounting, the theory and practice of banking and the banking laws of the State of Mississippi, and the federal banking laws. To each person who attains a grade of seventy-five per cent or more on said examination and who furnishes satisfactory evidence of good moral character, and of the possession of all the other qualifications set out in section 3 of this act, the said examining board shall issue a license to become a candidate for state bank examiner, which license shall be good and valid for four years and no longer. The said examinations, questions, answers and statements shall be filed of record in the banking department, and shall be open to the inspection of the public. A majority of the board of bank commissioners may perform all the duties required of said board by this act. Said examination questions shall be kept strictly secret until said examination is held and if any commissioner or employee of the banking department shall divulge or knowingly permit to become known to any person the said examination questions or any part thereof, be shall be deemed guilty of a misdemeanor and liable to a fine of not over five hundred dollars and upon conviction shall be removed from office. Any person who shall have knowledge of any part of the questions to be asked at any examination shall be ineligible to stand said examination or to hold the office of bank examiner under a license based on said examination. Examination papers graded. ; certificates issued on grades of 75 per cent and over. The board of bank commissioners shall meet in the office of the banking department within fifteen days after the passage of this act, and organi-e, and within thirty days after the passage of this act, hold an examination for bank examiners and from among the applicants at said examination who attain a grade of seventy-five per cent or more and who furnish satisfactory evidence of good moral character and of the possession of all the other qualifications set out in section 3 o*this act, the said board of bank commissioners shall declare the one applicant from each supreme court district receiving the highest grade per centum of the applicants from that district as the bank exaliner from that district for the State of Mississippi and shall issue to each of such applicants so declared a certificate as bank examiner, which https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis - 4 -certificate shall be good and valid until the first Monday in January, 1916, and until the successor of the holder thereof shall qualify, and which certificate shall be the authority for the holder thereof upon compliance with all the qualification requirements of this act, to enter at once upon the discharge of the duties of the office of state bank examiner. Vacancies on board of examiners filled by competitive examination. If a vacancy shall occur in the office of state bank examiner it shall be filled for the unexpired term by competitive examination in the same manner as her - tofore provided in this section for the first state bank examiners under this act, and an examination for this purpose shall be held on the second Monday after such vacancy shall have occured. Examinations continued until sufficient number qualified. If for any reason any regular or special examination is not held at the time provided in this act, or if at any regular or sp=cial examination a sufficient number of applicants fail to qualify for the office of bank examiner, then it shall be the duty of the board of bank commissioners to hold on every tenth day thereafter a special examination until the required number of applicants shall qualify. Notice of special examinations; how given. • The board of bank commissioners shall give notice of all special examinations in at least three papers published in different sections of the district for which said examination is held. Charges against examiners; hearings by commissioners; power of removal. Sec. 6. Charges against examiner. Any bank, under such rules as the board of bank commissioners may prescribe, may at any time present charges against the bank examiner, and thereupon the said board shall have power and must examine into such charges and, if the said examiner, upon a hearing, shall be found to have violated any of the provisions of this act or shall be found for any reason to be unfit or disqualified to hold the office of bank examiner, he may, in the discretion of the board, be removed by it. May compel witnesses„and administer oaths. For the purpose of any such investigation, any member of said board shall have the power to administer oaths and compel the attendance of witnesses and require the production of books and papers. Removal and penalties. The removal of the bank examiner shall not exempt him from any of the penalties herein prescribed. Sec. 7. Salary bank examiner, expenses office equipment, etc. The salary of each bank examiner shall be $3,000.00 per year, and traveling expenses, 11, https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 5 including only railroad fare, livery hire and hotel bills, While engaL;ed an official duty, payable monthly out of the banking department fund upon voucher, approved by the governor; and accompanying each voucher for expense there shall be an itemized statement of the same, together with receipts for amounts over one dollar. Office equipment and supplies; how provided and paid for. The banking department shall be supplied with all necessary office furniture, fixtures and equipment, which shall be purchased by the board of bar* examiners and paid for out of the banking department fund, on voucher, approved by the chairman of he board of bank. examiners. All necessary postage, stationery, expressage, books, telephone and telegraph messages, printing expenses and all premiums on bonds under this act, and all other office exJamsea of the banking department shall be allowed and paid for in the same manner as the office equipment and fixtures. All books) blank papers, and documents now in the custody of the State auditor, or in the office of any other State official or board connected with the matters embraced in this chapter shall upon request of the board of bank examiners, be delivered to the office of the banking department. • Sec. 8. Seal; evidence. The banking department shall have a seal which shall be in the form of a circle with the image of an eagle with thirteen stars over the head, in the center and about the margin at the bottom, the words: "State of Mississippi"; and at the top, the words: "Banking Department". Official documents and papersof board, admissible in evidence. Every certificate and other official paper executed by the banking department under the authority of law, and sealed with said seal of this office, shall be received as evidence in all courts) investigations and proceedings authorized by law, and may be recorded in the same manner and with like effect as a deed and all copies of papers in the office of the said department certified by an examiner or assistant with said seal shall be accepted in all matters equally and with like effect as the original. Sec. 9. Office assistant. The board of bank examiners shall appoint an office assistant, who shall perform such duties as they may require, and who shall receive a salary of not more than $1,800.00 annually) payable monthly out of the banking fund upon vouchers approved by the chairman of said board. Board reoponsible for assistant; may discharge him. The board of bank examiners shall be responsible for all the acts of said assistant and they may discharge said assistant at their pleasure. Bond of assistant. He shall execute the same bon4As is required of a bank examiner. Sec. 10. Duties: visit and inspect banks. It shall be the duty of the board of bank examiners to apportion the work among themselves of examining https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 6 • • banks, in such a manner as that each bank, under the provisions of this act, shall be examined twice a year, and oftener if necessary, at irregular intervals and without prior notice, provided that no bank examiner shall examine any one bank twice in succession. If the board of bank examiners find it impossible to make the required number of examinations of any bank or banks they may apply to the board of bank commissioners for assistants not to exceed three, and upon receipt of such application, it shall be the duty of the board of bank commissioners to appoint such assistant or assistants from among those applicants who have received a grade of seventy-five per cent or more in any regular or special examination. If for any reason there shall be no eligible for such appointment, then the board of bank commissioners shall hold a special examination and select through such examination the required number of assistants in the same manner as provided in this act for filling vacancies, except that they may be chosen from the State at large. Each assistant shall possess all the qualifications of a bank examiner and shall have all the powers and the duties of the bank examiners in the examination of banks and before entering upon his duties he shall give the same bond as required of the bank examiner The compensation of each assistant shall not exceed ten dollars per day, not to exceed one hundred and fifty dollars per month and traveling expenses, which expenses and three-fourths of said compensation shal] be paid out of the fund of the banking department on voucher approved by the board of bank examiners accompanied by an itemized statement of expenses and receipts therefor for all amounts over one dollar and one-fourth shall be paid by the board of bank examiners out of their own funds. He shall be removable at the pleasure of the bank examiners and shall be employed in the service of the examination of banks at such times andplaces as the board of bank examiners may determine and he shall not be allowed compensation for any time when not in actual service of the department, and under the direction of the board of bank examiners. Sec. 11. The same; to inspect books, accounts, etc. At such examination the examiner shall have the power and it is his duty, to examine the cash, bills, collaterals and securities, books of account, the condition and affairs of the bank, the mode of conducting and managing the affairs of the bank, the action of its directors and the investment of the funds of the bank. Said examiner shall have the power to examine the directors under oath as to the value of all collaterals, securities and other assets of the bank. Any officer of a bank refusing to the bank examiner any of the papers, securities, the books or cash of a bank, shall subject such bank to liquidation as hereinafter provided. Sec. 12. The same;_ summon witnesses; administer oaths. The examiner shall have the authority to issue subpoenas for witnesses and compel their attendance before him in any and all matters connected with the duties of his office, and for failure to attend or testify, witnesses may be fined by him for contempt. Sheriffs, etc., to execute process of board; penalty for failure. Sheriffs, constables and marshals holding commissions in this State shall serve and be entitled to regular fees for serving said subpoenas and for failing to execute or return such process they shall be liable for the same penalties prescribed by law for failure to execute like process issued by the courts of this State. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis e' - -7 .bank officials to be examined under oath; false swearing_pqnished. The bank examiner shall have the power to administer oaths, and shall have the authority to examine under oath the officers, agents, clerks, employes, owner or owners of any bank, or any other persons, touching the matters which he is by this act directed to examine into, and any person willfully making any false statement under oath in such examination shall be deemed guilty of perjury and upon conviction thereof punished accordingly. Penalty for making false statements not under oath. If any officer, agent, clerk or owner or owners of any bank, when not under oath, shall in any manner willfully misrepresent to any bank examiner the condition of the bank or purposely mislead or make false statements regarding the condition of said bank or any part of its business, said person shall be deemed guilty of a misdemeanor and upon conviction thereof in any court of competent jurisdiction such person shall be punished by a fine of one thousand dollars or imprisonment in the county jail not less than six months, or both fine and imprisonment. • Sec. 13. Stenographer may be used. The examiner in all cases, where the testimony of witnesses is to be preserved shall have the right to have the same taken down and transcribed by a stenographer, and a stenographer so employed shall be sworn by the examiner, and his or her certificate that the transcript of such evidence is correct, together with a certificate of the examiner that he has read the same and that it is, in his opinion, correct, shall entitle such transcript or a certified copy thereof to be received in evidence in any and all courts of this State and in all cases wherein such evidence is relevant, material and competent. Pay of stenographers employed by board. Such stenographer shall be paid not more than $10.00 per day in cases where no transcript of notes is made; if a transcript of the notes is made, there shall be allowed not more than ten cents per hundred words and no per diem; such stenographer to be paid out of the banking fund on voucher approved by the examiner employing such stenographer, accompanied with itemized statement of services rendered. Sec. 14. Secrecy of examinations as to depositor's accounts, and as te debtors to the bank. The board of bank examiners shall keep as records of their office the proper books showing all acts, matters and things done by them under the provisions of this act. Neither they nor their assistant shall disclose to any person, official or otherwise, except when required in legal proceedings, any fact or information obtained in the course of the performance of their duties, except so far as this act makes it incumbent upon them to report to the board of bank examiners, or to make public records and publish same. Names of depositors not to be divulged except when required in legal proceedings. In no instance shall the name of any depositor, or the amount of his deposit, be disclosed to any one, except when required to be done in legal https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 8 proceedings or in case of insolvency of bank, and any violation of this provision shall be considered a misdemeanor and, upon conviction thereof, in any court of competent jurisdiction, such person shall be punished by fine of one thousand dollars, or imprisoned in the county jail not less than six months, or both. And, in addition, thereto, shall be liable upon his bond to any person damaged thereby. Sec. 15. The same; certain credits on examination prohibited. In all bank examinations herein provided for no bank shall be allowed credit for any obligation or security whereof the principal and interest shall be over twelve months past due; nor for any bond or other obliLation upon which any interest may be in default for as much as twelve months; nor for any stock of its own held more than twelve months; nor for any unsecured over-drafts that may have existed for a greater period than three months next preceding it, and in making up the statemenV6f the condition of such bank any such item shall be charged off, but if desired a note shall be appended giving the details thereof; provided the discretion of the bank examiner may be exercised in cases of estates in litigation or administration and in pending suits. Provided this section shall not take effect until twelve months after passage of this act. Provided the security affected thereby shall, in the opinion of the examiner making such examination be ample and sufficient. • Sec. 16. The same; special examinations. Itkhall be the duty of the chairman of the board of bank examiners) upon receipt of registered letter from the board of directors of any bank, under the provisions of this act, requesting him to give such bank a special examination, within ten days of the receipt of such notice, to designate one of the bank examiners to make such an examination for which the bank shall pay the said examiner a fee of onehalf of the amount of its latest assessed tax under this act, which fee the examiner shall forthwith pay into the banking department. Sec. 17. The same; when last _public statement wrong. If upon the completion of any examination, an examiner shall find that the last public statement of the bank is materially wrong or that the condition of the bank has materially changed since the last public statement, he shall order the bank to publish a new statement based upon the findings of his examination and for the failure to promptly publish said statement, the bank shall be liable for a penalty of $500.00, for which the board of bank examiners shall sue for the use of the banking department if not paid within ten days. Sec. 18. The same; cal]s for reports of banks. Form of report. The bank examiners shall call upon each bank governed by the provisions of this act for the reports herein required. Such calls shall be made by the board of bank examiners for the same dates and as often as calls are issued by the comptroller of the currency of the United States for reports from national banks. The bank examiners shall prescribe the forms for such reports. Said reports shall be sworn to by either the owners, president, manager or cashbr of the bank making them and attested by not less than two of the board of directors; and shall exhibit in detail, under appropriate heads, the total resources and total liabilities of the bank on the past day by the board of bank examiners specified, and said reports shall be transmitted by the bank to the board of bank examiners within ten days of the receipt of a written . I or telegraphic request therefor. The bank making such report shall cause an abstract of the same to be published according to forms prescribed by the board af bank examiners within fifteen days from receipt of call, in some https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 9 newspaper published in the city or town where such bank is situated, or, if no newspaper is published therein, then in some newspaper published at the county seat of the county in which such bank is situated. Proof of such publication shall be furnished by the bank to the board of bank examiners within ten days from the completion thereof. For any failure or delay in furnishing said report, publishing the same andsupplying the proof thereof, the owners, president, manager or cashier of any such bank, so in default, and the members of the board of directors of said bank, refusing to attest said report shall be deemed guilty of a misdemeanor and upon conviction thereof shall be punished by a fine of fifty dollars a day for each day while in such default. Sec. 19. The same; charges for copies of bank reports. A copy of such report of any bank shall be furnished to any person or corporation requesting the same, for a fee of fifty cents, which fee shall be collected by the board of bank examiners of assistant furnishing said report, and shall be paid into the banking department fund. ; Office assistan4 penalty for violation of his duties. • If the office assistant of the banking department shall fail or refuse to furnish copies of said report when so requested and tendered the said fee, or if he shall fail to account for any such fees received by him, or if he shall demand or receive any larger fee than that herein prescribed, or if any other person than a bank examiner or assistant shell furnish any copzbf such bank report, whether for a consideration or not to anyone, he shall be guilty of a misdemeanor and shall be fined not less than ten dollars or be imprisoned not more than one month or both. Sec. 20. The samei when capital stock impaired or lawful reserve not maintained. If from the examination or from any report made by a bank governed , by the provisions of this act it appears that the capital of said bank is reduced by impairment or otherwise or that its cash reserve is below the requirements of law, it shall be the duty of the board of examiners to require such bank to make good the deficiency within thirty days. Sec. 21. The same. When to liquidate. If any bank examiner from any examination or any report rendered under this act shall be of the opinion that any bank is insolvent or that its condition is such that a further continuance of its business is hazardous to its creditors, depositors or the public) or that the bank has failed to comply with any of the rules, conditions or restrictions provided by law, he shall forthwith call a meeting of the board of bank examiners at such time and place as he may designate, and report the facts to said meeting. s, 4, cl4 Sec. 22. The same. To liquidate. If the board of bank examiners find that any bank is attempting todo business with less than the minimum capital , required by law or witamt, having its full capital paid in, or that any bank is insolvent; or that any bank has for any reason failed, or if the holders of two-thirds of the stock of any bank shall vote to liquidate or dissolve it, then it shall be the duty of the board of bank examiners to forthwith liquidate the same as hereinafter provided. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis -10Banks penalized for failure to complzwith orders of examiners. • If the board of bank examiners find that any bank has made a payment of dividends contrary to law, or made any charges against the surplus account contrary to law, or suffered its capital to remain impaired after thirty days' notice, or allowed its reserve fund to remain below the legal minimum after thirty days' notice, or for persistently allowing its reserve fund to become below the legal limit, or for persistent violation of any of the other provisions of law, then the board of bank examiners may, by majority vote, instruct the proper examiner to proceed to liquidate such bank according to the provisions of this act and it shall be the duty of such examiner to so proceed. Any bank violating any of the provisions set out in this section is liable to liquidation. Banks assessed for maintenance of bank department. Sec. 23. Assessments. Each bank subject to the provisions of this act is hereby assessed for each year one-fortieth of one per cent of its total assets, and the money accruing from said assessment shall he used for the 3 mrintenance of the banking department. ,.. • Sec. 24. Assessment, and expenses. As soon as practicable after their appointment the boord of bank examiners shall meet and prepare a statement based upon the total assets of each bank shown by its last report to the State auditor, of the assessments due by each banl, under their supervision. They shall send to each bank a statement of the assessment due by it, which amount shall be due and payable upon receipt of notice and shall be paid not later than tensams after receipt of said notice. Any bank failing to make payment within/ten days shall be liable to pay damages to the extent of 10 per cent of the amount of its assessment for each day of delay. Payment of assessments, fees and Tenalties- where and to whom made. 1 All assessments, penalties and fees 1-xovided in this act shall be paid to the board of bank examiners. All assessments, fees and penalties Jackson at collected under the provisions of this act shall, immediately upon receipt thereof, be delivered to the State treasurer to be placed to the credit of the banking department. Each bank examiner shall Ave a receipt made in duplicate for all monies received by him and shall take a receipt from the State treasurer for all money delivered by the examiner to the treasurer. Board to ascertain and fix amount of assessments annually. The office assistant shall have the powers and the duties of a bank examiner in regard to receiving, accounting for and delivering to the State treasurer all assessments, fees and penalties collected under this act. The board of bank examiners shall meet on the first Monday in January, 1915, and on the same day each subsequent year and ascertain the amount with which each bank subject to the provisions of this act shall be assessed during the current year, and they shall take asii basis for their calculations the last statement prior to said date made to them by the banks of this State and shall proceed to collect said assessment in the same manner as here inbefore set out. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis -11- • Sec. 25. The same meeting of the board of bank examiners. The members of the board of bank examiners shall hold a regular meeting in the office of the banking department on the first Monday in January, April, July and October of each year, and at such other times as the chairman of said board shall deem it necessary to issue a call therefor. Sec. 26. How money Paid out. All monies paid out of the banking department fund shall be paid by the treasurer upon warrants issued by the State auditor, which warrants said be issued by the said auditor upon voucher approved by the proper examiner except in payment of bank examiner's salaries and bank commissioner's per diem and expense and warrants shall be issued by the State auditor therefor, upon voucher approved by the governor. Sec. 27. Defining what shall constitute a bank. Any corporation (except national banks and postal savings banks) having a place of business within this State, where credits are opened by the deposit or collection of money or currency or negotiable paper subject to be paid or remitted upon draft, receipt, check or order, or sale of drafts or exchange drawn on local or foreign banks, shall be regarded as a bank or banker, and as doing a banking business under the provisions of this act. All concerns doing banking business must incorporates how section shall apply. Any person or firm now engaged in the banking business as described in this section shall incorporate within six months after this act goes into effect. This section shall not apply except when suen corporations keep the actual money on deposit or solicit outside deposits, but any person or association of persons now engaged in the banking business in this State shall be subject to all the provisions of this act until such person, persons or associations of persons shall be or become incorporated as provided in this section. Sec. 28. Organization of banks. Three or more persons of full age, and of good moral and safe business character may organize themselves into a banking corporation. Banking corporations may be formed under the general laws of the State, for the purpose of conducting and carrying on a banking business, and to establish offices of loan and deposit to be known as a savings bank, or to establish banks having departments for both classes of business upon the terms and conditions and subject to the liabilities prescribed in this act. Number of directors; charter to be filed. No banking corporation shall have less than three directors, and every banking corporation, before it transacts any banking business, shall file with the board of bank examiners certified copy of its articles of incorporation. Amount of capital stock ale required for a banking_ corporation. It shall be unlawful for any corporation, except as hereinafter provided, to transact a banking business unless such corporation has capital https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis / -12- staez as follows: In cities, villages and communities having a population of one thousand or less ten thousand dollars; in cities and towns having a population of one thousand and not more than twenty-five hundred fifteen thousand dollara; in cities and towns having a population of twenty-five hundred and not more than six thousand, twenty-five thousand dollars; in cities having a population of six thousand to ten thousand, thirtuy-five thousand dollars; in cities having a population of ten thousand or )re, fifty thousand dollars; provided this schedule of capital stock shall not apply- to banks now in operation in this State. Such capital shall be in money, commercial paper, bank furniture, fixtures, or the necessary bank building, including the lot or lots on which the building is situated, which said lot or lots shall be unincumbered. Sec. 29. Penalty for use of word "bank", etc. No corporation, except a national bank or postal savings bank shall carry on a banking business, except in compliance with this act. No corporation shall use either or any of the terms "bank," "banker," "bankers," "banking house" or "trust company," unless it shall have first fully complied with all the provisions of this act. Penalty for violations of this section. Any corporation violating any of the provisions of this section, after thirty days' notice given by the board of bank examiners, shall be deemed guilty of a misdemeanor and upon conviction the -eof shall be punished by a fine of not less than twenty dollars and not more than one hundred dollars for each day during which such violation shall continue after the expiration of said period of thirty days. Sec. 30. Articles of incorporation. The persons associating shall execute article of incorporation, which shall specify: First. The name assumed by such bank which shall be in no material respect, similar to the name of any other bank organized under the laws of this State. Second. The county, and city, town or village where such bank is to be located and to conduct its business. Third. The nature of its business) whether that of a commercial bank, savings bank, trust company or any combination thereof. Fourth. The amount of the capital stock, which shall be divided into shares of fifty or one hundred dollars each. Fifth. The names and places of residence of the stockholders, and the number of shares held by each of them. Sixth. The period for which the bank is organized which shall not exceed fifty years. Such articles of incorporation shall be acknowldged before any officer authorized by the laws of this State to take and certify acknowledgements. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis -13- • Articles of incorporation executed in triplicate. Such articles of incorporation shall be executed in triplicate, one of which shall be recorded in the office of the chancery clerk for the county in which the bank is located, and one filed in the office of the board of bank examiners and one filed in the office of the secretary of state. Such articles of incorporation, or copies ther-iof, duly certified by either of said officers, may be used as evidence in all courts for and against such bank. Sec. 31. Regulations with reference to paymenVof capital stock. All of the capital stock of every corporation engaged in the banking business shall be paid up in money before such corporation shall be authorized to commence such business. Newlj organized bank must be examined before beginninLbusiness. • When any bank hereafter organized or formed shall notify the board of bank examiners that its capital stock has been paid up, the board of bank examiners shall designate one of its members to make an examination of the bank immediately and, if it is found that the capital stock has been paid up and if it is found that said bank has complied with the requirements of this act, and is entitled to commence business, the examiner so designated shall give to such bank a certificate under his hand OLnd the official seal of the banking department, that it has complied with all of the provisions of the law and is duly authorized to transact a banking business. No bank shall transact any business except such as is necessarily preliminary to its organization, until it has been authorized by the board of bank examiners to commence the business of banking. Fee for such special examination. The assessment for such special examination shall be one-tenth of one per cent of the capital stock of the bank being examined, and such assessment shall be due are payable immediately upon the completion of such examination for which the bank examiner shall give a receipt therefor in duplicate and pay the same to the State treasurer to be placed to the credit of the banking department. Sec. 32. Amendment of charter. Any bank desiring to renew or amend its charter may do so by proceeding in the manner provided by law for the amendment of charters; provided, that upon making application, for such amendment a certificate from a bank examiner, showing the condition of the bank so applying at the time such application is made is accompanied therewith and the assessment for said special examination shall be the same as would be due for any regular examination. Benefits of guarantee fund; how banks may become "guaranteed banle." • Sec. 33. Any bank doing business in this State under the general bank- / / ing laws of Mississippi and any bank subject to the provisions of this act which may after the passage of this act be authorized to do business in this State, is hereby authorized and empowered to participate in the assessments https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis - 14 - • and benefits and to be governed by the regulations of the bank depositors' guarantee fund of the State of Mississippi hereinafter provided for. Before any bank shall become a guaranteed bank within the meaning of this act a resolution of its board of directors, authorized by its stockholders, duly certified by its president and secretary, asking therefor, in form to be provided by the board of bank examiners shall be filed with said board; who shall upon the filing of sudh resolution, authorize one of the examiners to make a rigid examination of the affairs of such bank, and if it is found to be solvent, to be properly managed and conducting its business in strict accordance with the banking law, such examiner shall after the bank shall have deposited with the State treasurer bonds or money hereinafter provided issue to such bank a certificate stating in substance that said bank has complied with the provisions of this act, and that its depositors are guaranteed by the bank depositors' guaranty fund of the State of Mississippi, as hereia provided. Deposit guarantees; securities to be denosited with State treasurer; kind and amount of same. Sec. 34. Before receiving such certificate from any bank examiner each 0/b bank entitled to the same according to section 33 of this act, shall as evidence of good faith deposit and shall at all times maintain with the -7 ;State treasurer (subject to the order of the board of bank examiners when countersigned by the auditor of State) United States bonds, Mississippi State bonds, the bonds of any levee district, or the bonds of any county, township, or municipal bonds within the State of Mississippi, to the amount of $500.00 (five hundred dollars) for every $100,000.00 or fraction thereof of its average deposits eligible to guaranty (less its capital and surplus) as shown by its last four published statements, provided that each bank shall so deposit not less than $500.00 and the State treasurer shall issue his receipt therefor in triplicate, one to the bank, one to the auditor of State and one to the board of bank examiners. Such bonds only shall be accepted as shall bear the certificate of the attorney general of the State of Mississippi, stating that in his opinion said bonds have been legally issued. Said bonds, or cash in lieu thereof, shall not be charged out of the assets of the bank, except as hereinafter provided, but shall be carried In its assets under a heading "guaranty fund with State treasurer," until such time as said bank shall default in payment of assessments hen-in provided for. In lieu of bonds the bank at its option, may deposit money which deposit shall be exchangeable for acceptable bonds when the bank elects to make the substitution. In addition to above, eacl, bank shall pay in cash an amount equal to one-twentieth of one per cent of its average deposits eligible to guaranty, less its capital and surplus, and the same shall be credited to the bank depositors' guaranty fund with the State treasurer subject to the order of the board of bank examiners and the State treasurer shall issue his receipt therefor in triplicate, one to the bank, one to the auditor of State, and one to the board of bank examiners; provided that the minimum assessment to be required from any bank shall be $20.00. The last above mentioned assessment, however, shall not be required of new banks formed by the reorganization or consolidation of banks which have previously complied with the terms of this act. Upon the deposit and acceptance of such bonds (or money) and the payment of said assessment, then payment of such deposits of said bank as are specified in this act, shall be guaranteed as herein provided and the bank entitled to its certificate. The fund provided for https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis -15- in section 33 and section 34 of this act shall be for the purpose of paying at once, and under the direction and control of the board of bank examiners of the de -ositors of banks that are declared insolvent by the board of bank examiners or banks that shall fail. Said payments to be made in the manner provided by the said board of bank examiners. All payments made to the deleositors of banks under the provisions of this act shall be repaid out of the assets of any bank whose depositors are paid out of this fund, and shall be a first lien on said assets., Assessments for guarantee fund; when to cease; fund to be maintained unimpaired. • Sec. 35. The board of bank examiners shall, during the month of January f of each year, make assessments of one-twentieth of one per cent of the average guaranteed deposits, less capital and surplus, of each bank ( the minimum assessment in any case to be $20.00) until the cash fund accumulated and placed to the credit of the bank depositors' guaranty fund shall be VI approximately $500,000.00 over and above the cash deposited in lieu of bonds, when said board shall discontinue such assessment. Should such fun t 4.e become depleted, the board of bank examiners shall make such additional assessment from time to time as may become necessary to maintain the same; provided, that not more than five such assessments of one-twentieth of one per cent each shall be made in any one calendar year. The treasurer of the State of 741ssis.2 1 .1)21 shall hold this fund in the State depository banks as provided by law governing other State funds, subject to the order of the board of bank examiners, to be countersigned by the auditor of State, for the payment of depositors of failed guaranteed banks as hereinafter provided. The State treasurer shall credit this fund quarterly with its proportionate share of interest received from State funds computed at the minimum rate of interest provided by law, upon the evera,e balance of said fund. Insolvent bank; how to be dealt withkeayment of creditors; notice published and proof of claims made. A- Sec. 36. When any bank shall be found to be insolvent by the bank examiner, he shall take charge of such bank as provided by law and proceed /7,iei to wind up its affairs; and he shall at the earliest possible moment issue to each depositor a certificate upon proof of claim, bearing 6 per cent inter- Ae. est per annum, upon which dividends shall be entered when paid, except where a contract rate exists on the deposit, in which case the certificate shall beer interest at the contract rate. Notice of the amount of each dividend to be paid creditors and the date when such payment is to be made shall be published in two consecutive issues of a paper of general circulation in a county or city in which said failed bank is located and a corresponding notice placed on the door of the examiner's office and interest shall cease on each dividend on the day named in such notice. The bank examiner shall likewise publish a notice of the date upon which he will make payment of any balance due on such proof of claim, and interest shall cease on the day so advertised and said proof of claim shall so state. After the officer in charge of the bank shall have realized upon the assets of such bank, and exhausted the double liability of its stockholders, and shall have paid all funds so collected in dividends to the creditors, he shall certify all balances due on guaranteed deposits ( if any exist) to the board of bank I https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 4,1 , t -16- • examiners, who shall then upon his approval of such certificates, draw checks upon the State treasurer, to be counter-signed by the auditor of state, payable out of the bank depositors' guaranty fund in favor of each depositor for the balance due on such proof of claim as hereinafter provided. If at any time the available funds in the bank depositors' guaranty fund shall not be sufficient to pay all guaranteed deposits of any 'ailed bank, the five assessments herein provided for having been made, the boardof bank examiners shall pay depositors pro rata, and the remainder shall be paid when the next assessment is available; provided, however,that whenever the board of bank examiners shall have paid any dividend to the depositors of any failed bank out of the bank depositors' guaranty fund, then all claims and rights of action of such depositors so paid shall revert to the board of bank examiners for the benefit of said bank depositors' guaranty fund, until such fund shall have been fully reimbursed for payments gde on account of such failed bank, with interest thereon at three per cent per 4 anmun. Banks failing to remit assessments penalized; its securities may be sold to pay same. • Sec. 37. A penalty of fifty per cent of the amount of said assessment shall be added tothe assessment of any bank not remitting as aforesaid within thirty days after receipt of notice of such assessment from the board of bank examiners, and if any bank which shall have been assessed and notified as aforesaid shall fail to remit the amount of said assessment as herein provided, a sufficient amount of its bonds (together with the unexpired coupons) shall be immediately sold by the board of bank examiners at public sale and the proceeds used to pay said assessment. Any balance remaining from the proceeds of such sale after the payment of such assessment shall remain to the credit of the bank in the depositors' guaranty fund. The said balance, together with the remainder of the bonds (or cash in lieu thereof) shall be forfeited to the bank depositors' guaranty fund if the bank doeatiot, within sixty days from default in payment of such assessment, remit the full amount of such assessments and penalty to date and restore the amount of its bonds, or money pledged as evidence of good faith. Upon the bank's failure to remit its assessments according to the terms of this act a bank examiner selected by the board of bank examiners shall immediately examine such bank, and if it is found, in his judgment, to be insolvent, he shall take charge of and liquidate said bank according to law. If said bank be found solvent, an additional penalty of fifty dollars shall be added for each day thereafter such bank is so in default. What deposits are subject to guarantee; amount of same certified. • Sec. 38. All deposits not otherwise secured shall be guaranteed by this act. The guaranty as provided for in this act shell not apply to a bank's obligation as indorser upon bills rediscounted, nor to bills payable, nor tc money- borrowed from its correspondents or others, nor to deposits bearing a greater rate of interest than four per cent per annum. Each guaranteed bank shall certify under oath to the board of bank examiners at the date of each called statement the amount of money it has on deposit not eligible to guaranty under the provisions of this act, and in assessing such bank this amount shall be deducted from the total deposits. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis -17 • De esits bet,r!, -aintaincds interests :ecord kept of same; uniform rates of interest to be nalty for claiming deposits guaranteed in violation of this act. Sec. 39. Each guaranteed bank, and each State or private bank not guaranteed by this act, shall keep a correct record of the interest rate and terms of each deposit on which it has paid or agreed to pay interest, and shall make a statement thereof under oath to the board of bank examiners quarterly. Any officer of any guaranteed bank who shall pay interest on - different tends or in excess of a rate which rate shall be uniform within each county) that shall be approved by the board of bank examiners from time to time on any form of deposits, or pay any interest on any savings deposit withdrawn before July 1st, or January 1st next following the date of deposit, or on any time certificate cashed before maturity shall be deemed to be reckless and may be removed from office as provided by law; provided, however, that any existing contract for higher rates of interest entered into before the taking effect of this section, may be carried out unimpaired, and such existing contract shall not subject banks to the provisions herein provided. Any managing officer of any bank guaranteed under this act, or any person acting in its behalf or for its benefits, who shall hereafter pay or promise to pay to any depositor either directly or indirectly, any rate of interest on different terms or in excess of or in addition to the maximum rate of interest permitted by this act, or who shall, with intent to evade any of the provisions of this act, pledge the time certificate or other obligation of such bank as security for the personal obligation of himself or any other person, or who shall display any card or other advertising tending to convey the impression that the deposits of the bank are guaranteed by the State ofMississippil either directly or indirectly, shall be deemed guilty of a misdemeanor, and on conviction be punished by a fine of not more than t1,000.00 nor less than ::'500.00. Any managing officer of any bank, or any person acting in its behalf or for its benefit who shall display any card or advertisement or make any statement to the effect that its deposits are guaranteed by the bank depositors? fund of the State of Mississippi, when the bank is not authorized to do so under the provisions of this act, shall be guilty of a misdemeanor, and upon conviction the-eof shall be subject to a fine of not less than five hundred dollars nor more than one thousand dollars. ( Securities returned when bank retires from business. Sec. 40. A solvent gupranteed bank, upon retiring from business and licuidating its affairs, shall be entitled to receive from the State treasurer its bond or money pledged, after all depositors in such bank and all assessments on account of the guaranteed banks in liquidation have been paid in full, but not any part of any unused assessments that may be in the bank depositors? guaranty fund. Cash or bonds in lieu of securities. Sec. 41. Banks may be permitted, in the discretion of the board of bank Orexaminers to exchange their bonds for others acceptable under this act, or be allowed to deposit in lieu thereof an equal amount of cash, which may in turn be withdrawn upon the substitution of bonds acceptable under this act. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis -18- Securities in guarantee fund to be kept separate from other funds. Sec. 42. Al]. bonds, and moneys deposited in lieu of bonds, placed in the State treasury under this act shall be kept in said treasury separate from all other bonds and moneys and to the credit of the bond account of the bank depositors' guaranty fund, and shall be used for no other purpose. The State treasurer shall cause thaeoupons upon said bonds to be cut thirty days before maturity and sent or delivered to the bank which deposited them; provided, always, that said bank shall have paid all assessments in full to date. Limitation on amount of deposits received by guaranteed banks. under the provisions of irtmaq; unlawful for any bank guaranteed six months in excess of ten this act to receive deposits continuously for times its paid-up capital and surplus) except savin,s banks, and any banks violating this section shall be deemed guilty of a misdemeanor and upon conviction punished by a fine of not less than $500.00 nor more than 01,000.00. Forms and reports p -eserved by bank examiners; forms and record books provided. • Sec. 44. For the purpose of carrying into effect th4rovisions of this act relating to the guarantee of bank deposits) the board of bank examiners shall provide that the necessary forms and all reports received by the ban], exariners shall be preserved by them in their offices; and the State treasurer is authorized to provide forms and record books for his office, and such forms and record bo ks shall be paid for upon order of the board of bank examinersout of the guaranty fund. How conflicting acts to be construed. Sec. 45. All acts and parts of acts in conflict with this act are hereby repealed in so far as they so conflict, but no provision of any banking law or other statute of this State shall be construed to be amended, modified or r - pealed except in so far as necessary to permit the unrestricted operation of this act as applied to banks participating inthe privileges of this act. When _guarantee of denosits to be-in sworn statement of condition filed; penalty for failure of _prompt compliance. ‘u- Sec. 45. (a). On and after May 15th, 1915, each and every banl: organized and existing under the laws of this State shall guarantee its deposits under the provisions of this act relating to the guarantee of bank deposits, and such banks shall not be required to be examined for license or certificate to participate in the guaranty fund, provided they shall have been examined twice already and found to be solvent, and provided, that within five days after May 15th, 1915, each and every bank in the State of Mississippi which shall not then be operating under the provisions hereof relative to the guarantee of deposits shall file with the board of bank examiners a sworn statement of its condition on May 15, 1915, in form to be prescribed by said board, and any such bank failing to comply with the provisions of this section providing for the guarantee of bank deposits shall be subjected to the same penalty heretofore provided for failure to pay any and all assessments for the purpose of creating a depositors' guaranty fund, and any https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis IJ -19- officer of any bank making affidavit to the statement hereinbefore required who shall make therein any false and misl_ading statement, shall be guilty of a felony and, upon conviction thereof, be punished as for perjury. How banks may participate after guzrantee fund becomes operative. Sec. 46. For the purpose of providing for the guarantee of its deposits, it shall be the duty of every bank organized and existing under the laws of I' this State which shall not theretofore have elected to guarantee its depositE„ ,. under the provisions of this act relating to the guarantee of bank deposits and which shall not have been examined twice during the twelve preceding months, to make within fifteen days after May 15th, 1915, application to the board of bank examiners for license to participate in the assessments and benefits and to be governed by the regulations of the bank depositors' guaranty fund of the State of Mississippi. Each such bank shall, by a resolution of its board of directors, duly certified by its president and secretary, in form to be provided by the board of bank examiners, and filed with such board of bank examiners, request admission to participate in such assessments and benefits, and, upon the filing of such resolution the board of examiners shall, as soon as possible, authorize one of the examiners to make a rigid examination of the affairs of such bank, and if it is found to be solvent, to be properly managed and conducting its business in strict accordance with the banking law, such examiner shall, after the bank shall have deposited with the State treasurer bonds or money, as hereinbefore provided to be deposited by the bank electing to come under the provisions of the bank depositors' guaranty fund, i:sue to such bank a certificate stating in substance that said bank has complied with the provisions of this act, and that its depositors are guaranteed by the bank depositors' guaranty fund of the State of Mississippi, as hereinbefore provided. Each bank coming under the provisions of this act after the 15th day of May, 1915, shall be subject to the same requirements, liabilities and conditions and entitled to the same privileges and benefits as hereinbefore provided for banks electing to come under the provisions of this act prior to said date. Any bank in the State of Mississippi which shall fail, neglect or refuse to comply with the provisions of- this act within fifteen days after the 15th day of May, 1915, providing for the guarantee of bank deposits, or which shall neglect, fail or refuse to comply with the reasonable demands of the board of bank examiners shall be subjected to the same penalty heretofore provided for failure to pay any and all assessments for the purpose of creating a depositors' guarantee fund. c-7,, • Sec. 47. Bank stock not accepted as collateral. The shares of stock of banks shall be deemed personal property, and shall be transferred on the books of the bank in such manner as the by-laws thereof shall direct, and as by law required. But no such bank shall accept as collateral, or be the purchaser of its own capital stock, except in cases where the taking of such collateral or such purchase, shall be necessary to prevent loss upon a debt previously contracted in good faith, and in such cases, unless full payment of such debt is made, such stock shall be sold by the bank within twelve months from the time it was acquired. Sec. 48. Record kept of names of stockholders, transfers of stock and fixing liabilities of stockholders selling stock. A book shall be provided and kept by every bank, in which shall be entered tkle names and residences of the stockholders thereof, the number of shares held by each, the time https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis • when such person became a stockholder, and also all transfers of stock, stating the time when made, the number of shares and by whom transferred. Liability when stockholder transfers stock from one bank to another. In all actions, suits and proceedings, Said bank shall be prima facie evidence of the facts therein stated. The liability of any stockholder in a bank upon transferring his stock in such bank to another shall not cease until the next regular or special examination of said bank following the date of transfer of said stock and not then unless such examination shows the bank to be solvent; but the purchaser's liability shall begin after the next ensuing examination sliming the bank to be solvent. Sec. 49. Conditions upon which real estate mai be held. Any corporation doing a banking business in this State may purchese, hold and convey real estate for the following purposes and no others: (1) Such real estate as shall be held necessary in which to transact thOusiness of any such bank, including with its banking offices, other peemises in the same building to rent as a source of income, but shall not exceed in cost to such bank thirty per cent of its paid in capital, surplus and undivided profits; provided that banks in cities of more than 6,000 population may invest nol, more than fifty per cent, by and with the consent of the board of bank examiners. (2` Such real estate as shall be purchased by or conveyed to such bank in satisfaction of or on account of debts previously contracted in the course of its business. (3). Such real estate as it shall purchase at sale under judgments, decrees, or mortgages, or deed of trust, foreclosure under securities held la,' it or under any security or lien whieh is a superior lien to that held by said bank. en real estate acquired under this sectiol to be sold. Any real estate heretofore acquired for any other purpose than as 2,e,-Ified in subdivision "1" of this section in any manner or form shall be sold within five years from the time this act takes effect, and any real estate acquired as provided in said subdivisions "2" and "3" after this act take effect shall be sold within five years after the title thereto is acquired If any such real estate is not sold within the time herein limited, it shall not thereafter be carried as an asset of the bank. Sec. 50. Qualifications and duties of directors. Ever,;,- director of every bank must be the owner, in his own right, of unimcumbered stock therein to the amount of at least two hundred dollars par value. He shall take and subscribe an oath that he will faithfully and diligently perform the duties of his office and will not knowingly violate or permit to be violated any provisions of this act. The said oath shall be immediately transmitted to the board of bank examiners and filed in their office. Every executive and managing agent of every bank doing business in this State shall subscribe to a similar oath and immediately transmit the same to the board of bank ' examiners. A majority of an executive board or auditing committee selectee. by a majority of the board of directors or of the board of directors of ev corporation doing a banking business in this State shall meet at least once every three months, and shall at such times examine the lone, paper and securities of the bank and its liabilities and resources of every kind. A statement showing the results of such examination shall be epread upon the records of the directors' meeting, and shall be mAmeribed to by each of said directors present at any such meeting. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis -21- • Sec. 51. Dividends to be declared. Any bank may declare a dividend of so much of the net profits of the bank, after providing for all expenses, interest and taxes accrued or due from such bank as shall be deemed just and expedient; but, before any such dividend is declared, not less than one tenth of the net profits of the bank for the preceding half year, or for such period as is covered by the dividend shall be carried to a surplus until such surplus shall amount to twenty per cent of its paid capital. No charges shall be made against such surplus for any purpose other than that necessary to provide for losses until such surplus shall equal twenty per cent of the paid capital, provided, hoTever, that said charges against said surplus fund shall be made only when the undivided profits are insuffidbnt to cover said losses. Sec. 52. Penalty for receiving deposits when insolvent. The owners or officers a_ employes of any bank or branch bank who shall receive any deposit knowingi„that such bank or branch bank is insolvent shall be deemed guilty of felony and punished, upon conviction therefor, by a fine not exceeding one thousand dollars, or imprisonment in the State penitentiary not exceeding two years, nor less than one year or by both such fine and imprionsment, at tle discretion of the court, for such offense. Sec. 53. Deposits of minors. When any minor or other person under disability shall make a deposit in any bank in his or her name, such bank may pay such money on a check or order of such person, the same as in other cases, and such payment shall be in all respects valid in law. When a deposit has been made or shall hereafter be made in the name of two persons, payable to either, or payable to either or the survivor, such deposit or any part t4lereof or interest or dividends thereon, may be paid to either of the said persons whether the other be living or not, and the receipt or acquittance of the person so paid shall be valid and sufficient release and discharge to the bank for any payment so made. Any bank may pay to the nearest relative of a deceased depositor, without necessity of administration, any sum to the credit of decedent not exceeding three hundred dollars. This section shall apply to all banking institutions, including national banks and postal savings banks within the State. Sec. 54. Liability of persons,. firms and corporations to banks. The total liability lD a bank_by a person, company, corporation or firm for money loaned including in the liabilities of a firm or company the liabilities of the several members thereof, shall not exceed twenty-five per cent of the aggregate paid in capital and surplus of said bank. The discount6f bills of exchange drawn in good faith, against actual existing values of loans made on time secured by warehouse receipts or bills of lading, or actually existing values, shall not be restricted to, or considered as coming within such limitations of twenty-five per cent; provided, that said loans shall not exceed ninety per cent of the actual value of commodities represented by said warehouse receipts, or actually existing values, but the discount of commercial or business paper, actually owned by a person, or firm negotiating shall not be construed as money borrowed or considered as coming with said limitation of twenty-five per cent. Any officer or director who shall allow in such cases loans prohibited ilythis section shall be liable individually therefor. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis -22- • • Sec. 55. Certifying to checks. No owner, officer, clerk or employe of any bank shall certify to a check unless the amount thereof actually stands to the credit of the drawer on the books of the bank, and any person who shall willfully violate this provision shall on conviction thereof, be deemed guilty of a misdemeanor and be punished by a fine not exceeding one thousand dollars. The amount of any check certified shall le at once charged to the drawers account and credited to certified checks account, there to remain until said check is retired. Any such check so certified by a duly authorized person shall be a good and valid oblization of the bank in the hands of the holder. Sec. 56. How officers and employes may borrow money from such banks. No officer, owner or employe of any bank in this State shall be permitted to I borrow any of the funds of the bank upon his own note or obligation whether secured or not without first having obtained the approval of a majority of the board of directors of the bank, or of an executive board of discounting committee selected by a majority of the board of directors; such selection to be recorded in the minutes and the approval of the loan, if obtained, shall be made a part of the records of the bank. And if the directors of any bank shall knowingly permit any of the officers, directors or employes of such bank to borrow the funds of such bank in an excessive or dishonest manner, or in a manner incurring great risk or loss to such bank, 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 corporation, its stockholders, or any other person shall have sustained in consequence thereof. No bank examiner shall be permitted to borrow money or effect any loan directly or indirectly of any bank to which this law applies. eSoc. 57. Cash reserves. Every ban% doing business under this act in cities or towns having a population of less than fifty thousand in-habitants shall have on hand at all times in actual cash, or balances due from good solvent banks, not less than fifteen per cent of its demand depists and seven per cent of its time and savings deposits. Every bank doing business under this act in cities having a popelation exceeding fifty thousand inhabitants, shall have on hand at all times in actual cash, or balances due from good solvent banks not less than twenty-five per cent of its demand deposits and ten per cent of its time and savings deposits. Sec. 58. Reports to legislature. The board of bank examiners shall ( make a full report as required by law of other State officers to the legislature at each biennial session thereof, of the proceedings in and work of the banking department, and of all charters issued and corporations liquidated or dissolved through its agency, and shall submit such recommendations with reference to said department as they may consider appropriate, which report shall, also, show fully and in detail, separately the work done and the eXpenses incurred by such examiner. Sec. 59. Liability or stockholders. The stockholders of every bank shall be individually liable, actually and ratably, and not for one another, for the benefit of the depositors in said bank to the amount of their stock at the par value thereof, in addition to the said stock; but persons holding stock as executors, administrators, guardians, or trustees, and persons holding stock as collateral security, shall n, I. be perL(nally liable as https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis -23- • stockholders, but the aes, t, and funds in their hands constituting the trust shall be liable to the same extent as the testator, intestate, ward or person interested in such trust fund would be, if living or competent to act; and the person pledging such stock shall be deemed the stockholder and liable under this section. Such liability may be enforced in a suit at law or in equity by any such bank in process of liquidation, or by any receiver, or other officer succeeding to the legal rights of said bank. /14 ,, / di te Procedure in case of liquidation; banks may enjoin action of examiners; claims against bank t be presented; action on same duties of examiners upon taking possession of bank property; disposition of assets; payment of dividends to depositors.; residue of assets turned over to stockholders; unclaimed deposits coeflicting claims. • S Sec. 60. Liquidation. Whenever any corporation doing a banking business / of whose property and business the be/17- examiner has taken possession as aforesaid deems itself aggrieved thereby, it may at any time within ten days after taking such possession, apply to the chancery court or chancellor in vacation or other court of like jurisdiction in the county where the principal office of such bank is .located to enjoin further proceedings by the bank examiner and the court, or chancellor in vacation, after citing the bank examiner to show cause why further proceedings should not be enjoined and hearing the allegations and proofs of the parties and determining the facts, may upon the merits dismiss such application and require the bank examiner to give an additional bond commensurate with the assets of the bank making such application or enjoin the bank examiner from further proceedings and direct him to surrender such business and property to such corporation; and any such application for injunct4_on may be heard at any time after one day's notice from the time of service on the bank examiner, in the discretion of the court. The bank examiner may, under his hand and official seal of the banking department, appoint an agent to assist him in the duty of liquidation an4 distribution of the assets of any bank taken possession of by him under the provisions hereof, the certificate of appointment to be filed in the office of the board of bank examiners and a certified copy in the office of the chancery clerk in the county in which the principal office of such bank was located, and such special agent shall receive a salary not exceeding t200.00 per month for the time he is actually engaged in assisting and liquidating the affairs of the bank. The bank examiner may authorize such agent to perform such other duties connected with such liquidation and distribution as the bank examiner himself could in person do and perform. The board of bank examiners may employ such counsel and procure such exper+, assistants and advIce as may be necessary in the liquidation and distribution of the assets of such bank, and may retain such of the officers or employes of such bank as they may deem necessary. The bank examiner shall require from the special agent appointed by him and from such assistents, as will have charge of any of the assets of the bank, such security for the faithful discharge of their duties as he may deem proper. The bank examiner shall cause notice to be given by advertisement in such newspaper as he may direct weekly, once a week for six consecutive weeks, calling on all persons who may have claims, but not including deposits shown by the books of the bank which shall prima facie be a proven claim against the bank, against such corporation, to present the same to the bank examiner and make legal proof thereof, at a place and within a time to be specified in this notice, not less than ninety days from the day of the first publication of the notice. The bank examiner shall mail a similar https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis - 24 - • • notice to all persons whose names appear as creditors upon the books of the corporation. If the bank examiner doubts the justice and validity of any claims or deposits, he may reject the same and serve notice of such rejection upon the claimant or depositor, either by mail or personally and an affidavit of service of such notice, which shall be prima facie evidence thereof, shall be filed in the office of the board of bank examiners. An action upon a claim so rejected must be brought by petition to the court having jurisdiction of the affairs of the bank by the claimant within six months after such service or the same shall be barred. Claims presented and allowed after the expiration of the ti7Je, fixed in the notice to creditors shall be entitled to share in the distribution only to the extent of the assets in the hands of the bank examiner at the time claims are filed, without allowing for previous distribution. Upon taking possession of the property and assets of such corporation the bank examiner shall make an inventory of the assets of such corporation in duplicate, one to be filed in the office of the board of bank examiners, and one in the office of the chancery clerk in the county in which the principal office of such corporation was located (but not recorded.) Upon examination of the time fixed for the presentation of claims, the bank examiner shall make in duplicate a full and complete list of the claims. presented, including and specifying which claims have been rejected by him, one to be filed in the office of the board of bank examiners and one in the office of the chancery clerk of the county in which the principal office of such corporation was located, but not to be recorded. Such inventory and list of claims shall be open at all reasonable times to inspection. The compensation of the special agents of the bank examiner, counsel and other employes and assistants and all expense of supervision and liquidation shall be fixed by the bank examiner subject to the approval of the circuit or chancery court in the county in which the principal office of such corporation is located, eeRvenea%len te aRy-aseietgn4-e/2-e4hep-empleye eeee4 on notice to such corporation, but in no event shall the compensation to any assistant or other employe exceed $200.00 per month for services actually rendered and unless in case of emergency the compensation to counsel must be fixed and approved before the services are rendered, to-wit; in no case to exceed ten per cent of the funds administered. When the compensation for the various parties aiding in the liquidation is fixed and approved the same shall be paid out of the funds of such corporation in the hands of the bank examiner, and shall be a prior charge and lien on the assets of such corporation. The money collected by the bank examiner shall be, from time to time deposited in one or more State depositories. At any time after the expiration of the date fixed for the presentation of claims, the bank examiner may, out of the funds remaining in his hands after the payment of expenses declare and pay one or more dividends to creditors, and as soon as practicable, thereafter, he shall declare and pay a final dividend, such dividend to be paid to such persons and in such amount and upon such notice as may be directed by the circuit or chancery court having jurisdiction of the cause in the county in which the principal office of such corporation i located. Objections to any claims or de.,)osits not rejected by the bank examiner, may be made by any party interested, by filing a copy of such objections with the bank examiner, who shall present the same to the court having jurisdiction before the time of the next application to declare a dividend. The court may make proper provisions for unproven or unclaimed deposits. Whenever the bank examiner shall have paid to each and every depositor and creditor of such https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis -25- • • corporation whose claim or claims as such creditor or depositor shall have been duly proven and allowed, the full amount of such claims, and shall have made proper provisions for unclaimed and unpaid deposits or dividends, and shall have paid all the expenses of liquidation, the bank examiner shall car a meeting of the stockholders of such corporation by giving notice thereof for thirty days by publication once 8 week for three consecutive weeks in one or more newspapers published in the county where the principal office of such corporation was located. At such meeting the stockholders shall elect by ballot an agent or agents who shall wind up the affairs of such corporation, and in so determining said stockholders shell vote by ballot, in person or by proxy each share of stock, entitling the holder to one vote, and the majority vote of the stock shall be necessary to an election, a majority of the stocIhresent and voting in person or by proxy being necessary. Such agent or agents shall execute and file with the bank examiner a bond, in such amount, with such security and in such form as shall be approved by the bank examiner conditioned for the faithful performance of all the duties of his or their trust, and so conditioned that any party aggrieved may bring or cause to be brought suit on said bond) and thereupon the bank examiner shall transfer and deliver to such agent or agents all the undivided and uncollected or other assets of such corporation then remaining in his hands and take a receipt therefor signed by such agent or agents, and upon such transfer and delivery the said bank examiner shall be discharged from any and all further liability to such corporation, and its creditors. Such agent or agents shall convert the assets coming into his or their possession into cash, and shall act for and make distribution of the property of said corporqtion as is herein provided in case of distribution by the bank examiner, except that the expense thereof shall be subject to the direction and control of the court having jurisdiction of the cause. In case of the death, removal or refusal to act of any such agent or agents selected by the stockholders, the stockholders on the same notice to be given by the bank examiner, upon proof of such death, removal or refusal to act, being filed with him, and by the same vote hereinbefore provided, may elect a successor who shall have the same powers and be subject to the same liabilities and duties as the agent originally elected. Dividends and unclaimed deposits remaining unpaid in the hands of the bank examiner for six months after the order for final distribution (at such rate of interest as is allowed by said State depositories) shall be by him deposited in one or more State de, ositories to the credit of the bank examiner in his official capacity in trust for the several depositors in and creditors of the liquidated bank: from which they were received, and the bank examiner shall pay over the money so held by him to the persons respectively entitled thereto upon being furnished satisfactory evidence of their right to same. In case of doubtful or conflicting claims, he may require an order from the court having jurisdiction authorizing and directing the payment thereof. He may apply the interest earned by the money so held by him toward defraying the expense in the payment qnd distribution of such unclaimed deposits or dividends to the depositors and creditors entitled to receive the same. The board of bank examiners' shall file annually with the governor of this State a report of the names of the banks tkken possession of and liquidated, and the sum unclaimed and unpaid deposits or dividends with respect to each of them respectively together with a statement of the amount of interest earned by such unclaimed dividends, which reports the governor must submit to the legislature. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis - 26 - • Sec. 61. Publicity of unknown deliositors. It shall be the duty of the bank examiner to report to the board of bank examiners the name of every person not known to be living who appears by the records of the bank to have a sum of money on deposit; provided this section shall only apply to deposits made five years or more prior to such report which have not been added to by such depositor by further deposits or reduced by withdrawal made by him. The boar46f bank examiners shall give publicity to any auch fact in such manner as the board may prescribe. Sec. 62. Interlocking bank directorates forbidden. No person shall be permitted to be a director in more than one bank serving the same incorporated town or city doing business in this State; provided, that any person holding a directorship in violation of this section when this act takes effect shall be given twelve months to comply with this section. Any person holding a directorship in violation of this section shall be guilty of a misdemeanor, and upon conviction shall be fined not more than S100.00 and be ineligible to hold a directorship in any bank under the provisions of this act within two years therefrom. Provided this section shall not apply to savings bank and trust companies operated in connection with commercial banks doing business in the same building. • Sec. 63. Voting trusts in banks prohibited. The transfer of any part of the stock of a bank under the provisions of this act, to trustees solely or primarily that they may vote the same at annual elections and stockholders' meetings--"voting trusts" as they are generally known--is expressly prohibited. A violation of this section by any bank or banks under the provisions of this act, shall constitubsa breach of law, and subject any such bank or banks to liquidation and forfeiture of their respective charters. Sec. 64. Banks forbidden to hold stock in other banks. No part of the( /p stock of any bank except regional reserve banks, doing business in this State shall be owned by any bank under the provisions of this act. Any such stock owned by any bank at the time this act takes effect shall be disposed of within twelve months after such time. In cases where such stock is taken as collateral and the purchase thereof shall be necessary to prevent loss upon a debt previously contracted in good faith, then in such cases such stock shall be sold by the bank within twelve months from the time that it was acquired. A violation of this section by any bank or banks under the provisions of this act shall be constituted a breach of law and subject any such bank or banks to liquidation and forfeit of their respective charters. 4 Sec. 65. ClearinK house associations must incorporate. No bank under the provisions of this act may be, become or remain a member of, or otherwise affiliated or connected with any voluntary or unincorporated organization performing any of the functions of a clearing house or clearing house association. Banks serving the same community or locality desiriag to be associated together for the purpose of a clearing house association, shall have such association become a body corporate of this State under the general law provided for corporations. All banks doing business in this State may become members of such association shall have the right to voluntary withdrawal from such clearing house association, subject to the discharge of its obligations to the association and the members thereof. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis - 27 - 411 Charter of clearing house association; what to prohibit; members not to be restricted to certain matters. The charter or articles of association or the law under which such association is organized must prohibit it and its officers and managers from exercising or attempting to exercise, directly or indirectly, any control or influence over its members thereof or over the conduct of their business except as expressly authorized by its charter, and from making or attempting to make or enforce any rule, regulation, agreement, or understanding in respect to any of the following prescribed subjects: (1) The restriction or regulation of competition between the members of the association or any of them in any matter or thing connected with the business conducted by such members or authorized to be done by them under their respective charters. (2) The fees, commission, or other compensation chargeable by or payable to or to be charged by or paid to any member by its customers or ct.herwi:_ for the collection by or through such member or its agent or correspondent of checks, drafts, notes, or bills or exchange drawn upon banks, bankers, trust companies, or others that are not members of such associations or that are outside its boundaries; • () The rates of discount or interest chargeable or to be charged by, or to be paid to, members on loans or discounts to or for customers or others. (4) The rates of interest to be allowed by members on deposits; and (5) The rates of exchange. A violation of this section by any bank or banks under the provisions of this act, shall constitute a breach of law and subject any such bank or banks to liquidation and forfeiture of their respective charters. Sec. 66. Definition of terms used. Whenever the word "bank" is used in this act, unless the context clearly shows that it is intended to be limited in its application to a particular character of bank, shall include trust companies, savings banks, branches of banks, and trust companies, and other institutions subject to the provisions in this act. The term "corporation," when used in this act to refer to banks, or trust companies shall be construed and held to embrace every character of bank, branch bank, trust companies, any branch thereof, and other corporations subject to the jurisdiction of the banking department. Bank officers, etc., must not contribute to campaign funds of candidate for examiner. Sec. 67. Any director, stockholder or officer of any banking institution coming under the provisions of this act who shall contribute directly or indirectly to the campaign expense of any candidate for bank examiner shall be :uilty of a misdemeanor and upon conviction shall be punished by a fine of https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis - 28 - • not less than $500.00 nor more than $1,000.00 and by imprisonment in the county jail not less than three months nor more than taelves months, or by both such fine and imprisonment, and receipt of such contribution shall disqualify the candidate knowingly receiving the same from holding the office of bank examiner. Sec. 68. Provisions of unconstitutionality of any part of this act, and repeal of all conflicting laws. It is hereby declared to be the legislative intent, that if the courts shall declare any pert, provision or section of this act to be unconstitutional said unconstitAlonality shall not effect or destroy any other part or provision or section of this act; and all laws or parts of laws in conflict with this act are hereby repealed. Sec. 69. When to take effect. That this Act shall take effect and be in force from and after its passage. Approved March 9, 1914. t , cravvvid • V https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis .( • AMENDMENTS TO THE BANKING LAWS OF MISSISSIPPI 1916 (Mrs. Bastedols Synopsis) e44,' Department of Banking Chapter 207, p. 314. Amends 1914 - Chapter 124, Section 23." . A minimum assessment of $50. a year is provided for. •• Examination Chapter 207, Section 1, p. 313. Amends 1914 - Chapter 124, Section 15. In the items not allov.able for credit, the item regarding overdrafts is changed to read: "Nor for any unsecured overdrafts that may have existed for greater period than 30 days" instead of "three months." The further provision is made and: "only such overdrafts shall be considered as secured as those advanced against products or actual existing values evidenced by warehouse receipts or bills of lading, or against bills of exchange drawn in good faith against actual existing values." S J )Jv ( Violations and Penalties Chapter 207, Section 3, p. 518. J • Neglect of duty by banker, officer, employee, director, or agent guilty of a misdemeanor. Any state bank examiner who neglects to carry out any part of the law where no other penalty is provided. .0.,\C--1-di 4 , 747: 0 ;7; I/ Fine not over 4500.00 and/or imprisonment not over 6 months. Chapter 207, Section 4, pp. 318-19. Perjury by officer, director, employee, owner or agent. Imprisonment not to exceed 3 years. Chapter 207, p. 318 Violation Penalty Sec. 2, p. 318 False statement by officer, director, cashier, agent, clerk, or owner with intent to deceive ) ) Fine of not over _1,000 or imprisonment not o'er 3 years. L-- Reports of Condition Chapter 207, Section 1, pp. 313-4. Amends 1914 - Chapter 124, Section 19. The only change is the specifying that a cony of such "published" report instead of just "report". (The slimmary at the beginning of https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis -2(Amendments - 1916) of the chapter refers to "chaoges for conies of bank reports" but only change, after two careful readings and checkings, to be found was the insertion of the word "published" before resort.) The Fund Chapter 207, Section 1, pp. 314-5. Amends 1914 Initial Deposit with State Treasurer. Chapter 124, Secti-a Good road bonds and drainage district bonds are added as acceptable security to be deposited. Where it states the uurpose of the fund it originally was written to pay "at once." The wor,:h9 "at once" are nawomitted. It is also provided thatnntes, bonds, securities or assets of any . kind, which any bank may deposit or hypothecate as collateral for funds borrowed, shall be used first for the liquidation of the debt for which said collaterals are hypothecated. Any remaining (or funds therefrom) are to be delivered to the bank or to the board of banking examiners for the protection of the depositories of the bank and for the Guaranty Fund. Assessments Chapter 207, Section 1, pp. 515-6. Amends 1914 - Chapter 124, Section 55. In the date for making assessments the phrase "or as soon thereafter as practicable" is added. S T;.e further provision is made that whenever the current fund reaches 0.0,000 and as often as the fund shall accumulate to that amount the state treasurer, by order of the Board of Bank examiners, shall invest proceeds of the fund. U. S. or Lississippi state bonds,the bonds of any levee or drainage district or the bonds of any county, township or municipal bonds within the state of mississippi. Interest Chapter 207, Section 1, pp. 316-17. Amends 1914 •- Chapter 124, Section 39. instead of making a statement "quarterly" it now reads "upon the same dates for which call statements are made as provided for in Section 18 of this act." Stockholders Liability Chapter 207, Section 1, p. 318. Amends 1914 - Chapter 124, Section 59. In the old section, in giving the exception for persons holding stock as executors, etc., the phrase "and persons holding stock as collateral security" is included. In the new one, this is omitted at that point and the same phrase inserted subsequently as follows: "and persons holding stock as collateral security shall not be personally responsible as stockholders but the person holding such stock shall be deemed liable under this section. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis -3(Amendments - 1916) • Loans and Investments Chapter 207. Section 1, P. 317. Amends 1914, Chapter 124, Section 56. Loans to Officers and Employees. The section is the same but with the provision regarding violations added that any officer, director, owner or employee who borrows or permits to be borrowed any money or funds in violation of this act shall for each offense either be fined up to :;t5,000 or be imprisoned up to 3 years. The penalty for violation by a bank examiner is a fine of not more than $5,000. The discount of commercial or business paper, actually owned by a b construed as money person pr firm making the negotiations shall not! 11; ., , .Cyrowed or coming within the 25% limit.,,, J ,, . )Any of,r pr direpI2E.., shall be liable fi.T?4 ' individ , - 115/qt-ergfor, Depositories. Public Chapter 208, p. 319. Amends 1914 - Chapter 257, Section 2. The additional provision is made that failing to secure a county depository by advertisement to the banks of the county and adjoining counties, they shall re-advertise in the county and in a state bank throwing it open to any state bank and giving preference to banks outside the home county. The clerk of the board of supervisors is to send a copy of the notice to the state treasurer who will assist in getting some bank in the state to bid. Deposits Subject to Guaranty Chapter n177, p. 316. Amends 1914 - Charter 12/1, Section 38. First sentence is amended to read as follows: Remainder unchanged. Sec. 3. All deposits not otherwise secured and all cashier's chec:s, certified checks or sight exchange issued by banks operating under this law shall be clara-teed by this act. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis AMENDMENTS TO THE BANKING LAWS OF MISSISSIPPI - 1917 (Mrs. Bastedois Synopsis) Trust Companies HAMC - Section 6524, p. 1832 Duties and Powers. May accent rnd execute all trusts and perform such duties as may be committed to them by any person or corpor-tion, or by order of any court, or in any other fiduciary capacity authorized by law. They may loan money on real estate or collateral security. must not be of greater rate than allowed by law. Interest Must make same reports each year, showing their assets and liabilitic_. and be governed by the same laws as other banking institutions. HAMC - Section 5525, pp. 1852-35 Mutual loan Department. Expenses, losses and profits to be kept separate from all other departments. "They may receive as members of said department persons who desire to become such and to borrow money from the company and to fix and regulate the manner of conducting such department. Shares of stock may be issued to sue, borrowers, to be paid for .n such installments as may be agreed upon or fixed by the by-laws." 8% interest maximum allowed company itself or other investors in the department. The remainder of the net profits are to be credited on the stock of the borrowing members, who are to continue to pay the installments agreed upon until such stock matures or their indebtee ness is otherwise discharged. All their loans may be secured by mortgages or trust deeds on real estate or other sufficient collateral security. They may own such real estate as may be required and convenient for the transaction of their business and as they may acquire in the enforcement and collection of debts due them. HAMC - Section 3526, p. 1833. Use of terms. All corporations in the state authorized to do a banking business must use the word "bank" or "banking" in its name and those chartered to do a trust business must use the word "trust," and these terms may not be used in any corporate name where such business is not authorized. RAMC - Section 3527, p. 1833. Use of name of bank by other persons not permitted. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis -2(Amendments - 1917) Branch Banking HA&C - Sections 6521 and 3522, p. 1831 (Sec. 260 of 1906) Creation of branch banks after this act goes into effect is expressly forbidden, both in the state and by a parent Mississippi state bank outside the state. Every parent bank operating a branch bank or banks must set apart for the exclusive use of each such branch capital of at least 0_0,000. • https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis • Ami-WmENIS 10 ihM bANKING LI61S OF MISSISSIPPI - 1918 (Mrs. Bastedo's Synopsis) Assessments Chapter 165, Section 1, pp. 179-30. Amends 1916 Ch. 207, pp. 315-16(10-P( In setting the annual date for assessments the date "during the month of January" is modified by "or as soon thereafter as practicable." \41 In the provisions for inv sting the fund, instead of "shall amount to as much as 0.0,000 as often as the fund shall amount to" it nov, reads, "whenever the guaranty fund amounts to $10,000 or multiples of g;10,000." Road district bonds, and guaranty certificates issued by the banking department are added to permissible investments. The provision is added that whenever the demand on the guaranty fund exceeds the cash on hand, the state treasurer shall, at the order of the board of bank examiners, sell or hypothecate such bonds as they deem advisable. In addition to crediting the fund with its share of interest on the funds deposited, the state treasurer is also to credit it with the interest on tne bonds in which the funds are invested. I oieuidation - Voluntary • Chapter 247, Section 1, pp. 303-305. Upon a vote of 2/3 of the capital stock of any solven coi poration they may proceed as follows: (a) the bank to notify the board of banking examiners by registerea mail of their intention to liquidate, enclosing a certified copy of the minutes of the stockholders' meeting. They shall publish each week, for 6 consecutive weeks, in a local newspaper giving the date of the proposed liquidation and calling all creditors and deoositors to present their claims within 30 days after the date set. Included also is to be a detailed statement of the assets and liabilities of the corporation. (b) the stockholders, with the approval of the board ofbank examiners, appoint a special agent to have charge of tae liquidation and to be responsible to the creditors and stockholders as well as to the board of bank examiners. The special agent to furnish bond approved by the board of bank examiners and to receive a salary of not over :200.00 per month while actually engaged in the liquidation of the bank. Special agent to be under the supervision of the board of bank examiners. (c) Special agent is to take charge on the date set for liquidation, in the notice, and to file with the board of bank examiners a sworn detailed statement of the assets and liabilities of the bank. He is to proceed to pay in full, as presented, all claims of creditors and depositors as shown on the books of the bank and all claims which may be proven. • (d) The stockholders of the bank are to furnish a sufficient bond, approved by the board of bank examiners, to insure the payment of all https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis • -2-(Amendments - 1918) liabilities shown on the books of the bank and all proven claims. Any suits brought upon such bond must be within 4 months after date of liquidation. (e) At the end of 30 days from the date of liquidation, the special agent is to file with the board of banking examiners a detailed report of all his proceedings, collections and disbursements, and a list of all assets remaining and all liabilities still unpaid. Also a list of all unclaimed deposits or creditors as shown by the books. The amounts due are to be delivered in cash to the board of banking exaffiiners and by them to be deposited in a guaranteed bank for paymen . to the said depositors or creditors upon presentation of their claims. The remaining assets of the bank may be distributed among the stockholders provided they make sufficient bond "in amount of the capital, surplus and undivided profits of the bank",said bond to expire 4 months from the date of liquidation provided no claim or suit may have been filed against it. Examiners Chapter 165, p. 177. Amends 1917 - HAMC, Sec. 3529; 1914 - Ch. 124, Sec. 2. Chairman of board of bank examiners is to be selected from among the members of that board by the board of bank cammissioners. Chapter 165, p. 177. Amends 1917 - dAMC, Sec. 3545; 1914 - Ch. 124, Sec. 7. V Salary. The salary of bank examiners is increased from 3,000 to 3,600 per year. Chapter 165, p. 178. Amends 1917 - HAMC, Sec. 3552; 1914 - Ch. 124, Sec. 10. In the original section 3/4 of the compensation was to be paid from V the banking department funds and 1(4 from the funds of the board of bank examiners. The new section omits "3/4 of said compensation to be" and states that all such expenses are to be paid from the funds of the banking department. Chapter 165, Section p. 181. The board of ban examiners is given discretion in emergencies to employ special counsel to assist in the prosecution of persons charged with criminal act in connection with any state bank. The compensation for such counsel is to be fixed by said board and paid out of the banking department fund. The maximum to be 4500.00. Receiving Deposits when Insolvent Chapter 166, Section 1, p. 182. Amends 1917-HAMC, Sec. 3612; 1914 - Ch. 1.24, Sec. 52. V The modified phrase "or having reason to believe" is added to "knowing that such bank or branch bank is insolvent." Clearing House Association Chapter 165, Section 1, pp. 180-1. Amends 1917-HAMC, Sec. 3633 and 3664 (numbers given are 3268 and 3269. These are evidently a misprint.) The additional provision is made that all rates, rules, regulations and by-laws must before becoming effective receive the approval of the board of bank examiners. Discretionary power is invested in the board of bank examiners. • https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis - • (Amendments - 1918) Depositoidas, Public Chapter 153, Section 1, pp. 157-8. State. Any bank in state may qualify as state depository by placing on deposit as security with state treasurer any of the following securities -- tne market value of which is 10% great_u than the account applied for: Mississippi registered state bonds; Yazoo and Mississippi Delta Levee District bonds; mississippi Levee District bonds; county bonds and municipal bonds of counties and cities of Mississippi: municipal bonds of cities with a population of 100,00Q6nd over, located in the states of Louisiana, Texas, Arkansas, Alabama, Georgia, Florida and Tennessee; United States bonds; and also coupon bonds of the state of Mississippi; certificates of indebtedness and notes of the state of Mississippi, which are legal, recognized and binding obligations of the state of Mississippi under the constitution and laws thereof when offered as security, or surety bonds of any surety company authorized to do business in the state of Mississippi. Money to be drawn from depositories as nearly equitably as Possible, except where there is a state depository in a county the general school fund must be drawn from the depository in that county. Chapter 153, Section 1, pp. 167-8. 6110.: County. Any bank in a county, or in an adjoining county where there is no bank in the county qualifying, may qualify as a county depository by placing on deposit with the county treasurer as security any of the following securites when worth at least par on the market in an amount 10% greater than the maximum to be placed on deposit: Mississippi registered and coupon state bonds; Yazoo and Mississippi de;.ta levee district bonds: Mississippi levee district bonds; county bonds and municipal bonds of counties and municipdities in Mississippi; State of Louisiana bonds; bonds of the city of New Orleans and state of Louisiana levee bonds; United States bonds. Mississippi drainage district bonds; bonds of any consolidated school district, road district of this state; certificates of indebtedness and notes of the state of Mississippi which are legal, recognized binding obligations of said state of mississippi, under the constitution and laws thereof when aflibred as security. • Or surety bonds of any authorized surety company in the state. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis -4(Amendments - 1918) If at any time the bonds deposited become worth less than par on the market, the board has the right to demand other and different security. Failure to deposit the additional security on demand forfeits the bank's rights as a depository. The board has the right to reject bids where they believe the security insufficient. Federal heserve Membershio I ), Chapter 248, Sections I and 2, p. 306. Any state bank or trust company is given the power to subscribe to the capital stock and become a member of a Federal heserve bank. Any state bank or trust!p mpany, whic-1 becomes a member of a Federal to comply with the reserve requirements heserve Bank, is and the amendments thereto, in lieu of state requirements relating to maintenance of reserves. • https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis AMENDMENTS TO THE BANKING LAWS OF MISSISSIPPI - 1920 411 (Mrs. Bastedo's Synopsis) Bank Commissioners, Board of Chapter 188, pp. 252-3. Amends 1917 - HAmC, Ch. 3, Sec. 3552, 3533, 3534, 3535, 3536; 1914 - Ch. 124, Sec. 4. The compensation of the bank commissioners was changed from a per diem of $5.00 and expenses, while in the discharge of his duties, to an annual salary of $300.00 and expenses. Relation of Capital to Deposits Chapter 189, Section 1, p. 255; Amends 1917 - HAMC, Sec. 3601. — A recess of two years from the law as enacted is provided for alloy ing 12 months for a bank to adjust its caoital and deposits to the 10 to I ratio, after an excess. Examiners Chapter 188, p. 253. Amends 1917 - HAkIC, Sec. 3549 and 5550 1914 - Ch. 124, Sec. 9. The salary of the office assistant is increased from $1,800 to $2,400 per year. • In addition to the office assistant, the board of ban examiners L7 authorized to appoint a clerk or stenographer to be under the office assistant and to receive a salary of not over $1,500 annually payable out of the "banking fund." The office assistant and clerk or stenographer to execute the same bond as a bank examiner. / Chapter 188, p. 254 and p. 255. Amends 1918, Ch. 165, p. 178, Sec. 1% The assistants appointed by the board of bank examiners compensation of Z10.00 per day and expenses with a maximum of $150.00 per month, while actually employed in tne work of examining the banks, is changed to an annual salary of Z3,000.00 per year and expenses. Chapter 138, p. 255. Amends 1918 Ch. 165, Sec 7. Al' \ 4 The salary of bank examiners is increased from $3,600 per year to $5,000 per year. Loans and Investments Chapter 187, Section 1, pp. 251-2. Any guaranteed state bank may accept drafts or bills ofexchange drawn upon it, having not more than 6 months sight to run, exclusive of days of grace, whIcA grow out of transactions involving the shipment of goods provided shipping documents coaveying or securing the title are attached, or which are secured by warehouse receipts or other documents conveying or securing the title covering "readily marketable staples not subject to rapid deterioration." • https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Such acceptances for any one person, company, firm or corporation are limited in the aggregate to 10% of the bank's paid-up and unimpaired capital and surplus unless secured by such attached documents. No such bank shall accept such bills to an amount &luta, at any time in the aggregate to more than 1/2 of its paid-up and unimpaired capital and surplus. -2(Amendments - 1920) Branch Banking Chapter 192, Sec. 1, p. 257. Amends1917 - HAMC - Sec. 3521. Makes exception of restriction against branch banks in cities of at least 10,000 population, where the majority of the state bank examiners believe the convenience and interest of the public will be served, they may permit the establishment of branch offices within the corporate,limits o the city in which the bank is t 4 cte• 91,-0 ( domiciled, - Chapter 184, Section 1, p. 249. Any national bank with one or more branches existing and doing business in this state that shall surrender its charter as a national bank and convert to a state bank has the right to operate the same branch banleunder the state law as it operated under its charter as a national bank. Exchange Charges Chapter 183, Section 1, p. 248. "For the purpose of providing for the solvency, protection and safety of the banking institutions of Mississippi", the custom of the banks to charge a service fee for collecting and remitting by exchange the proceeds of checks, drafts, bills, etc., is declared the law of the state and applies to both state and national banks. • The amount of the charge is fixed at 1/10 of 1% of the total amount of the item with a minimum of 101 on any one transaction. Exception to this rule is wade, however, in the settlement of obligations due the state of Assissippi or any subdivision thereof or of the United States. Also no such charge can be made for the collection of checks deposited with the banks where the check is drawn on any other bank in the same municipality. It is snecifically stated that this is not mandatory but optional Sec. 2, p. 248. There is no right of action at law or in equity against a bank for refusal to pay such cash item, when the refusal is based on the ground of non-payment of such exchange. Sec. 3. National Banks. If the courts, for any reason, hold that national banks in the state are not required to charge and collect such exchange, this act is still to remain in full force and effect as to all other banks in the state. In the event of any national bank refusing to comply with this act such refusal being upheld by the courts it is optional with the state banks in the same municipality with the national bank as to whether or not such charges shall be made. Bank Officers and Employees Chapter 18b, Section 1, p. 250. Bonds. Every active officer and employee of any state bank or trust company must furnish a fidelity bond. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Sec. 2. The amount of sudh bond to be fixed by the Board of DirectoTs, subject to the approval of the state bank examiners. AMENDMENTS 10 THE BANKING LAWS IF MISSISSIPPI - 1922 S (Mrs. Bastedo's Synopsis) Department of Banking Section 26, Chapter 2: Amends 1914 - Ca. 124, Sec. t3, p. 189. The only change is that the superintendent takes the place of the board of bank examiners. Section 25, p. 139. Arends 1914 - Ch. 124, Sec. 44. / The superktendent takes the place of the,bank examinelmin authorityA and the reference to the office assistant having the -)olur and duties of the bank examiner, etc., is omitted. Examinations • Section 11, Chapter 172, p. 186: Amends 1920 - Ch. 188 (1914 - Sec. 10, Ch. 124.) It is provided for each ban,: to be examined at least twice a year at irregular intervals without prior notice but except at the order of the superittendent no bank is to be examined by the same examiner twice in succession. Section 16, p. 185; Amends 1916 Ca. 207. (1914, Sec. 15.) Th or7ision,i ,s added., that only such overdrafts shall sha be considered / as e advanotd againsp-prodUcts,of actualx4sting values ed \ se , : ///i . wafehouse replp-ts, etcy -1-7', ev,i enced . Li,Al . / ':' , 62- i' r ' Section 17: p. 136; Amends' 1914 - Ch. 124, Sec. 16. Special examinations. Duty transferred from chairman of board of bank examiners tr) superintendent of banks. III Section 18, p. 136; Amends 1914 - Ca. 124, Sec. 17. hesponsibility placed on superintendent, or on examiner. Violations and Penalties Chapter 172, Section 50, p. 205. Amends 1914, Ch. 124, Sec. 67. "Any officer, or employee of the banking department" is substituted for "candidate for bank examiner". Reports of Condition. Section 19, pp. 186-877 Amends 1914 - Ch. 124, Sec. 13. Superintendent substituted for bank examiners. Section 20, p. 187; Amends 1914 - Ch. 124, Sec. 19. Superintendent to collect fee instead of examiners. Capital Stock Impairment Chapter 172, Section 21, pp. 187-8; Amends 1914 - Ch. 124, Sec. 20. When the superintendent believes the capital stock of any bank impaired he is to require the stockholders to restore the capital or to execute a bond for the benefit of the creditors in a sum to be specified by the superintendent that all "just debts and liabilities" will be paid in full within a time, not to exceed 12 months, set by the Superintendent. • https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis -2(Amendments - 1922) If the capital is not restored or bond furnished within the time set, the superintendent is to take possession of the institution until either business is resumed or its affairs liquidated. Stock sold or restored: If capital is not restored within Y; days after the superintendent takes possession, he may sell it or as much thereof as may be necessary to make good the deficiency, selling as much, pro rata, of the stock as may be necessary to restore the capital, calling in and canceling stock to the amount of the stock sold. Any stockholder wilfully withholding his share "sold for delivery to the purchaser" commits a misdemeanor and is subject to a penalty of 4250.00 for each share he owns and fails to transmit to the superintendent on demand. If the stockholder owns a greater number of shares than the "pro rata of his stock sold" then the superintendent shall re -issue to him certificates of such shares of his stock that have not been sold. The superintendent has the legal right to take possession of all the stock of the stockholders for the yurpose herein before provided and has legal authority to institute proceedings in his own name as superintendent for the recovery and possession of stock held. Any pledgee of such stock has the right to the proceeds when convertec. Any impairment of cash reserve shall be made good within 30 days. • Banks - Organization Chapter 172, Section 27, p. 190. Amends 1910 Ch. 165 (1914 Ch. 124, Sec. 28) The only change is that the articles of incorporation are to be filed with the superintendent of banks instead of with timboard of bank examiners. Liquidation - When Chapter 172, Sec. 22 skeriallt, pp. 138-9. Amends 1914 - Ch. 124, Sec. 2140P. The superintendent takes the place of the board of bank examiners ins:t1,144//the banlv7examiner TepoFting to the board for consideration, e su6erintenadAt46 considsrt,taila / i1 , )..o , , , , , i, '• PI, ( "' , u.,44.1.ast--.Yro 4.t. , .., t . - I ' • . / • f: ^ , t-4,07134 -pieection 22 of 1914 the only change is the substituting the super- / intendent for the board of bank examiners. Articles of Incorporation Chapter 172, Section 28, p. 190. Amends 1914 - Ch. 124, Sec. O. Provides that one covey of the articles of incorporation shall be filed in the office of the banking department instead of in the office of the board of bank examiners. Preliminary Report Chapter 172, Sec. 29, pp. 190-91. Amends 1914, Ch. 124, Sec. 51. Superintendent of banks is inserted in place of board of bank examiners. • https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis I wi4. -3 - • (Amendments - 1922) Charters Chapter 172, Section 30, p. 191. Amends 1914 - Ch. 124, Sec. 32. Is amended to read "a certificate from the superintendent or a bank examiner," instead of just "bank examiner." Membership in Fund Chapter 172, Section 31, pp. 191-92. Amends 1914 - Ch. 124, Sec. 33. The superintendent of banks is substituted for board of bank examiners. Sec. 40, pp. 197-98. Amends 1914 - Ch. 124, Sec. 45a. Superintendent is substituted for board of bank examiners. SUS?ENDED by 1930 - Ch. 22, Sec. 1, p. 23-24. After guaranty fund becomes operative - Sec. 41, p. 198. Amends 1914 Ch. 124, Sec. 46. The superintendent of banks is substituted for board of bank examiner::. SUSPENDED by 1930 - Gn. 22, Sec. 1, p. 23-24. The Fund Chapter 172, Section 38. Amends 1914 - Ch. 124, Sec. 41. Initial Deposit. he superintendent of banks is substituted for board of bank exam.ners. • The state treasurer is autiorized to insure if possible all 1Dnds delivered to nim under this section against loss by robbery, theft, embezzlement or other unlawful appropriation, and the premium to be paid out of the maintenance fund. Assessments Chapter 172, Section 32, p. 192-93. Amends 1916 - Ch. 207 (1914- Ch. Sections 34 .and 35), 4; , Superintendent is substituted for board of bank examiners. Section 35, p. 195. A ends 1914 - Ch. 124, Sec.37. The onLy change is the superintendent is substituted for both board of bank examiners and examiners. Liquidation Chapter 172, Section 34, pp. 194-95. Amends 1914 - Ch. 124 - Sec. 36. Sale of assets to another bank. Superintendent has power after he has taken charge of an insolvent bank, with the consent of the majority of the directors to sell the assets of the bank to any existing solvent bank at such price as he may consider fair value. ihe puramming bank to assume the full amount due all creditors of the liquidating bank and paying the remainder of the purchase price if any, to such liquidating bank. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis In all cases the superintendent must require the purchasing bank to execute to him a bond with one or more approved sureties for the benefit of the creditors of the bank in case te purchaser bank fails to -4(Amendments - 1922) pay any creditor the full amount of his claim. The creditor has the right to bring suit in the name of the superintendent against such purchasing bank and the surety on its bond and all interested parties way join therein. The original sections follow with the exception of the substitution of the suoerintendent for the board of banK examiners. Sec. 47, pp. 200-204. Amends 1914 Ch. 124, .ec. 60. The su)erintendent of banks and department of banking are substituted in place of board of bank examiners. The limitation as to the amount to be paid to "assistant or other employee" and also to counsel, is omitted. Jae Fund Chapter 172, Section 36, pp. 195-96. Amends 1916 Ch. 207 (1914 - Ch. 124, Sec. '58.) The only change is the superintendent is substituted for board of bank examiners. Enterest Chapter 172, Section 37, p. 196. Amends 1916 Ch. 207 (1914 Ch. 124, Sec. 59.) In the first sentence the 1.eference to private bank is omitted , and superintendent of banks is substituted for board of bank examiners. Liquidation - Voluntary Chapter 172, Section 51, pp. 205-06. Amends 1918, Ch. 247. "Banking department" is substituted for "board of bank examine rs." In "e" the bonds are to be made payable just to the state of Mississippi instead of the Boerd of Bank examiners. Stockholders Liability Chapter 172, Section 46, p. 200-01. Amends 1916 - Co. 207 (1914 - Ch. 124, Sec. 59.) Banking department is substituted for board of bank examine rs. Board of Directors Chapter 172, Section 43, p. 199. Amends 1914 - Ch. 124., Sec. 50. Banking department is substituted for board of bank examine rs. Incaminers Chapter 172, Section 5, p. 180. Not to exceed seven examiners to be appointed by the superin tendent of banks. Said examiners to work under the direction of the superintendent. To be at least 25 years of age, of good moral dharacter, practic al accountants with a thorough understanding of the theory and practices of banking. They may not during their term of office be connected directly or indirectly with any banking institution. • https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis • -5(Amendments - 1922) The superintendent is himself to examine banks when not otherwise employed in his duties. 192416) But prior to the first Monday in January when the first superintendent of banks takes office the board of bank examiners is author ized to employ at their discretion not to exceed two additional assistant bank examiners to serve from month to month and be removabl( at the option of the board. Such assistants to receive the same salary now provided for assistant bank examiners. The board is also authorized prior to January 1924 to employ additional clerical help as may be deemed necessary. Sec. 6, p. 180. Amends 1914, Ch. 124, Sec. 3. Oath and Bond: The first paragraph of section 3 regarding is omitted (new qualifications being prescribed in section qualifctons F). The same requirement fojo....41 and bond of the examiners is the s;. except that the approvs to be by the superintendent of banks instead of by the Governor. • Section 7. p. 181. ,Amends 1914 - Oh. 124, Sec. 6. Presented before a board consisting of the Governor, Charges against Attorney General, and the Chief Justice of the Supreme Court. If the board finds that any provision of the law has been violated or that the person in question is unfit in any way to hold office or that his holding of the office would "imperil the rights hereunder protected," they may at their discretion remove such person. In connection with such investigation any member of the board has power to aaminister oaths and compel the attendance of witnesses, etc. 141,/ ) Section 8, p. 181. Amends1920 - Ch. 188. The salary of an examiner not to exceed 300. per month "to be fixed by the superintendent" and traveling expenses payable monthly out of the banking department funds, each voucher to be accompanied by an itemized statement. In regard to office furniture, fixtures andi maFiAsal etc., it is changed giving the superintendent of bhii*k the atVority to request books, Papers and documents delivered to 4e nking department. . • 1.- . Section 9, p. 183. Arne-7,Air — ?Ch. Lft.;-,---44.-4.wa... / /j • It is changed to reqtareirallapers to be certified by tendent or an examiner,instead.of by an examiner. Al • "the superin- Except with the consent of the superintendent no original papers may be removed at any time from the department. , •! , Section 10 amends 1_920 Ch. 188. -/ The superintendent instead of the board of bank examiners is to appoint an office assistant and in addition to the office assistant he is authorized to apnoint two clerks and additional clerks may be appointed with the consent of the executive committee of the Mississippi Bankers Association. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis -6- • (Amendments - 1922) The assistants shall receive a salary of not more than U,400 and each clerk of not more than C1,500 annually, out of the banking department's maintenance funds. Instead of the board of bank examiners the superintendent is made responsible for the acts of examiners, of assistants and of clerks. Said office assistants and clerks to execute bond of not less than 0_0,000. No examiner or other employee related in any way within a third degree to the superintendent shall be employed by him. Section 11, p. 183; amends 1920 - Ch. 188 (1914 - C. 124, Section 10.) The apportioning of the work among tne examiners is now in the hands of the superintendent and in connection with the tlatase that no examiner shall examine one bank twice in succession the superin tendent may at his discretion permit this. Section 12, p. 186: amends 1914 Sec. 11. Superintendent is added to examiner in power in connection with making investigations. The additional provision is made that the suPerintendent or exaihci may call for statements from all corresponding banksor persons or corporations showing a balance on the books of the bank of more than 1,500. at each examination. 'I • Reports to tne Legislature Chapter 172, Section 45, p. 200. Amends 1914 - Ch. 124, Sec. 58. In the beginning superintendent of banks is substituted for board of bank examiners, end at the lgist, the superintendent is added to "each bank examiner." i,oans and Investments Chapter 172, Section 42, p. 199. Amends 1914 - Ch. 124, Section 4. Instead of "with the consent of the board of banK examiners" it now reads "with the consent of the superintendent of banks." Section 44., pp. 199-200. Amends 1916, Ch. 207 (1914 - Ch. 124, Sec. 56) Loans to officers rnd employees. No officer or employee of the banking department" is substituted for "bank examiner." Section 49, pp. 204-05. Amends 1914 - Ch. 124, Sec. 64. The new section adds "Edge Law banks" to the exception along with regional reserve banks. Branch Banking Chapter 176, Section 1., p. 212. / (-/,/ • Provided that branch banks may bei raxeyed from one municipality to another with the consent of t1e4pank bxaminer. • https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis _7 _ (Amendments - 1922) • Superintendent of Banks Chapter 172, pp. 178-208, Sec. 1. Amending 1914 Ch. 124, Sec. 1. 40' Creating the office of and vesting full suoervisory power in the superintendent of banking. Section 2, pp. 178-79. How Chosen. On the first Monday in December 1923 and :nce every four years thereafter, the directors of every state guaranteed bank I are to elect one of their officers or directors a delegate to a con-1" 4 0,, vention to be the succeeding Monday to elect a superintendent of banks and to fix nis salary. No branch bank to have a delegate or vote. The Secretary of State to preside until a chairman and secretary are elected. In case of a vacancy a convention to be called to elect a successor. Section 3, p. 179. .1.1a1ifications. Man of good chiLreepr.t jjeoll,yeawxperience as an executive in a reputable solveht'bank,in Misnssippi but shall not be interested directly or indirectly in any bank while in office. Must file "constitutional oath," and execute a $50,000 bond in an authorized surety company in the state. Section 4. Removal. Removal for neglect of duty, 0Malfeapance, misfeasance, extortion, extortion or corruption in office, incompetency or intemperance in the use of intoxicating liquors or narcotics to such an extent, in view of the dignity of the office and the importance of his duties, as to unfit him therefor, or for any offense involving moral turpitude while in office." Also, should three banks fail in any one year due to his failure to discharge the duties of his office. Should the office be vacant the oldest examiner is to serve as superintendent until a superintendent is appointed. 4 Section 5, r. loO. • The su.)erintendent to appoint the examiners. see "Examiners." For further details Section 7, p. 181. Amends 1914 - Ch. 124, Sec. 6. A board consisting of the governor, attorney general, and chief justice of the supreme court, will hear the charges against the supti intendent or examiners. See "Examiners." Chapter 172, Section 13, pp. 186-4. Amends 1914 - Ch. 124, Sec. 12. It now reads: The superintendent or examiner shall have the authority "instead of just examiner" and the additional provision is made for his authority to "invoke the process of the chancery court to compel sucn testimony",, etc. Section 14, p.184. Amends 1914, Ca. 124, Sec. 13. The supervisory power is put in the hands of the Superintendent, or examiner. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis -8(Amendments - 1922) Section 15, p. 185. Amends 1914, Ch. 124, Sec. 14. Adris superintendent to those required to keep a record of transactions and to keep information confidential. Public Funds 1, • Chapter 177, pp. 212-13. All public funds deposited in a bank are declhrea trust funds and not "liable to be taken by the general creditors of the officer or by the creditors of the depository." It is made a first claim on the funds of a bank that is in the hands of the examiners. 4. ' )2 • 1 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis . 4/ 4 /61 1 6'1 ' • AmEND-MENTS TO THE BANKING LAWS OF MISSISSIPPI - 1924 (m.s. Bastedo's Synopsis) Charters Chatter 17E, ap. 226-7. Amends 1922, Ch. 172, Sec. 29 (1914 Ch. 124, Sec. 31.) In addition to requiring the capital stock to be paid up and that the bank has complied with all the requirements of the law, it is now also required that superintendent, governor and attorney general, or a majority of the 3 aforesaid officers, shall find that the public interest requires the organization of such bank. Liquidation Cheater 176, pp. 227-8. Amends 1922 Ch. 172, Sec. 34 (1914, Ch. 124, Sec. 36) ( 6.149.4t Lale of Assets to Another Bania fAt77.;a1. Instead of realizing on the assets of the bank and exhausting the double liability of the stockholders before "certifying all balances due on guaranteed deposits" r. S \ it is now provided "whenever it shall appear to the officer in charge of the bank that before realizing upon the assets of such bank and F' s exhausting the double liability of its stockholders there wUl be Er A insufficient amount realized to pay guaranteed depposr'iL If alscia,4b the Funeinreiider of Liquidation...3, provia&C-thatidepositors be paid from " r , , _ b,••I fIr, ,° ' '' ' I 7 Attorneys _ P Chapter 173, p. 225 For the Banking Department. -----, Sec. 1. The superintendent of banks is authorized to employ an attorney for the banking department who must be at least 30 years of age and has been a practicing attorney and a citizen of the state for 5 years immediately preceding his employment. Sec. 2. Such attorney to advise the superintendent upon loss relating to tne banking department, represent the superintendent and the banking department in the courts, and do all legal work in connection with the liquidation of banks and such other duties as may be required of him in the administration of the department. Sec. 3. Salary subject to the approval of the executive committee of the Bankers Association but not to exceed 11;7,500 a year to be paid either out of the funds of banks in liquidation ore out of the Guaranty or Maintenance Fund, provided for in Ch. 124, of the 1914 Laws. Branch Banking / :66 Chapter 174, p. 226. Amends 1922, Ch. 176. --/7 The "superintendent of banks" is substituted for the "board of bank examiners." 4 A https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis i7 AMhNDMENTS TO THE BANKING LAWS OF MISSISSIPPI - 1926 (Mrs. Bastedo's Synopsis) \ Department of Banking Chapter 251, p. 365. Amends 1922, Ch. 172, Sec. 24. (1914 - Ch. 124, Sec. 23) \: The minimum assessment is raised from $50.00 to $60.00 and is a flat rate, instead of a percentage. Banks, whose total assets exceed $100,000 are to pay, in addition to the minimum assessment, 25 for 00* every $1,000 or fraction thereof, in addition to the $100,000. 1 ) f State Bank - Definition Chapter 247, p. 361. Banking corporations, operating under state law, may, without amend ing their charters, exercise authority to perform "allusual, proper and legitimate functions of trust ccmpanics; provides that any bank, whose charter merely authorizes general banking functions, must first receive the consent of the superintendent of banks. r 1,0A Articles of Incorporation Chapter 250, p. 363. Amends 1922, Ch. 172, Sec. 28 (1914 Ch. 124, Sec. 30) The specific provision is made that the Articles of Incorporation need not be published. • Liquidation Chapter 252, pp. 3G4365. Amends 1924, Ch. 176 (1922, Ch. 172, Sec. 34, 1914, Ch. 124, Sec. 36) 4 / it Sale. of Assets to another Bank 1-1 4e.t.ei, t 441,41 It provides that Lostead of the certificate of depositors bearing 6% interest to bear 4% interest, where no contract rate exists. eA ,/, Instead of the isitilillisiacLo. the Guoranty Fund f ha. ( -;.ikiie&t;&-Ghe--t4te-igernk drawing 3% interest, they are to draw 4% interest. Relation of Capital to Deoosits V.Chapter 249, p. 362. Amends 1920, Ch. 189 (1914, Ch. 124, Sec. 43) - .7 .7' It is unlawfu or any guaranteed bank to receive and holddepositsf-' ,4-°' mo ths in excess of 10 times its paid-up capital and for more than surplus. However ch bank may with the permission of the superintendent of baaks had deposits up to 15 times its capital and surpiis. A duplicate copy of such written permission to be kept in the office of the superintendent ofb ia44. The permission may be withdrawn upon 6 month's notice. Such .quidations-do not apply to savings banks. Violation of this section is a misdemeanor, subject to a fine of from $500 to 41,000. arust Companies Chapter 247, p. 561 Banking corporations, operating under state law, may, without amending their charters, exercise authority to perform "all usual, proper and legitimate functions of trust companies; provides that any bank7 whose charter merely authorizes the general banking functions, must first receive the consent of the superintendent of banks. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Aw-IMiliiENTL: ID THE BANKING LiiS OF iiISSIJPFI - 1928 S Eastedo's Synopsis) -xaminers Chapter 95, pp. 138-9. Amends 1918 - Ch. 165, Sec. 7071,, This matter is put into the hands of the superintendent of banks. For further details see "superintendent of Banks." Superintendent of Banks iii Chapter 95, pp. 138-9. Amends 1918, Ch. 165, Sec. 7i.14,Sec. 1. The superintendent is given power, in his discretion, to employ special examiners, investigators, and agents as needed to audit and investigate the records of any state bank when he has reason to believe that there is a loss caused by someone's criminal actions. He also has power to employ "competent counsel" to assist in the prosecution of anyone charged with a criminal act which has caused loss to a state bank. Sec. 2. The salary and expense of such special examiners, etc. the fee of the special attorney may be paid out of the fun.' f State Banking Department. Bills Payable and hediscounts Chapter 94, p. 139 Sec. 1. State banks may not borrow or owe at any tiEe a total amount in excess of 3 times its capital and surplus. But it is provided that the limit may be exceeded by a bank wit , the consent in writing of the superintendent of banks. Sec. 2. Violation of this provision by a bank autImrizes the State Banking Department to tem it as a bank "being operated in violation of the law." https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Sec. 6. This act is in no wise to impair the obligations of banks procuring loans in excess of this limitand any bank having borrowed money in excess of this limit, prior to the passage of this act, is not to be considered acting in violation of the law with regard to such loans. A AMENDMENTS TO THE BANKING LAWS OF MISSISSIPPI - 1930 (Mrs. Bastedots Synopsis) lee Fund Chapter 22, Sec. 2, p. 24. Amends 1922 Ch. 172, Sec. 32 (1914 Ch. 122, Sec. p4) Initial Deposit -"Before receiving such certificate" is omitted. For every 4i100,000 or fraction thereof "its average unsecured deposi ts" is substituted for "deposits eligible for guaranty." "Not less than 0C10" is amended to read "not less than 000, a.r value , of such securities." Beginning with the provisions for the assessments of 1/20 of 1%, the rest of the section is omitted containing all refere nces to the initial payment of 1 20 of 1%, -1his revision applies until all outstanding guaran ty certifi cates as described in this act are liquidated and paid, at which time the laws shall be in full force and effect as before tney were last amended. Assessments Chapter 22, Sec. 6, pp. 24-25. Amends 1922 Ch. 172, Sec. 33 (1914 Ch. 124, Sec. 35). It is now written "average unsecured deposits" instea d of "guaranteed deposits" and instead of the provision "until the fund accumulated reaches approximately 4500,000" it is now provided that four additional assessments of 1i20 of 1% (in addition to the January assessments) but not more than five such assessments can be made in any one year. These assessments to be made until a suffic ient amount is realized together with the property and assessments in the ands of the state banking department to pay the outstanding guaranty certificates previously issued to depositors of failed guaranteed banks. The liability of the banks is liAted ti the unpaid assessments previously made. The "initial deposits" in thehands of the state treasurer is, as before, a security for these assessments. • The state treasurer, as before, is to credit the guaran ty fund quarterly with its share of interest at the minimum rate provided by law. • Certificates are to be paid from the fund in the order in which the banks to whose depositors the certificates, were issued were closed. But funds from the assets now in the department are first to be applied to any remaining certificates issued to depositors from the bank from which the assets were received. Inis revision applies until all outstanding guaran ty certificates as described in this act are liquidated and paid, at which time the laws will be in full force and effect as before they were last amended. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis - 2 (Amendments - 1950) Liquidation Ch. 22, Section 4, pp. 25-26. Amends 1926 Ch. 252, Sec. 1 (IE4 - Ch. 17C 1922, Ch. 172, sec. 34; 1914, Ch. 124, Sec. 36.) 1/7 Sale of Assets to another bank The provision for sale of the assets of a closed bank to a solvent bank is the same; tne rest of the section dealing with liquidation and issuing of certificates is omitted. e, NOTE: Ihis revision applies until all outstanding guaranty certificates as described in this act are liquidated and paid, at wUch time the laws shall be in full force and effect as before they were last amended. The Fund - What it Covers Ch. 22, Sec. 5, p. 26. Amends 1922, Ch. 172, Sec. 36. (191C, Ch. 207; 1914, C. 44, Sec. 68). nt giertifi9ates legally issued "heretofore" to deposi rine letaaly been drawn before t:is act goes into torsfriVat-WEI effect, and certificates legally issued for cashiers' checks and sight exchange drawn by failed banks previously to their failure, and such certificates due to have been so issued before this act takes effect. Eac', bank is to certify to the superintendent of banks at the date of each call the statement of the amount of money which is on deposit that is not in any wise secured and in assessing any bank this amount' shall be deducted from the total deposits. • his revision applies until all outstanding guaranty certiNOTEficates as described in this act are liquidated and paid, at which time the laws shall be in full force and effect as before they were last amended. Interest Ch. 22, Sec. 6, pp. 26-27. Amends 1922, ch. 172, Sec. 37 (1916 Ch. 207; 1914 Ch. 124, Sec. 39) Instead of "each guaranteed bank and each state bank guaranteed by this act" it now reads "each state bank". The provision for excepting contracts for nigher rates of interest entered into before the act went into effect is omitted. 41 NOTE: t1 This revision applies until all outstandng guaranty certificates as described in this act are 1i4uidated and paid, at which time the laws shall be in full force and effect as before they were last amended. Depositors' Protection Fund Ch. 22, Sec. 6A, p. 27. For the purpose of protecting depositors in banks that may fail during the li4uidation of the present guaranty deficit as provided under tnis —1. act. erJ https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis -3 (Amendments - 1950) • Each bank shall be assessed by the superintendent on December 51 each year beginning with 1930 6% on that part of its surplus exempt from taxation by tnis act. The rate of assessent not to be less than 3% unless the depositors protection fund shall exceed 7500,0 00 in which event the rate may be lowered so that it will produce a fund of $500,000 and no more for any calenar year. _ bection 6B, pp. 27-28. ihis fund to be applied to the payment of depositors for their respective losses through failed banks. If the fund is insuff icient to take care of such losses then the application shall be determined on a pro rata basis in the proportion of the depositors indivi dual losses (after liquidation of a failed bank carrying the deposi t) to the total losses of all depositors. A deficit in the fund shall not be carried into any succeeding year. If a surplus is shown the surplus shall be carried to the succeeding year. The superintendent of banks immediately upon taking charge of an insolvent bank is to issue non-interest beering certificates. Note: This revision applies until all outstanding guaranty certificates as described in this act are liquidated and paid, at which time the laws shall be in full force and effect p.s before they were last amended. • Surplus Chapter 22, Section 9, pp. 23-29. For the protection of its depositors the directors of each state bank shall before declaring a dividend carry 12 of its net profits of the preceding year to its surplus account until its surplus reaches at least 100% of its capital. The capital stock of such bank shall not be reduced pending the operation of this act. Section 10, p. 29./. / How invested. ,In bonds of the United States, State of :dississinpi, county, districts, and municipalities in the state of Ussissivoi. An accurate record of the securities in which the surplu is s invested to be kept by eacn bank. It is the superintendent's duty to see that the provisions for this surplus are carried out and any violation makes the bank subject to liquidation. ;,41AA'A Section 11, p. 29. 441, d • Otee f Exemntion. Provided they are complying with this law the surplus of state banks up to an amount equal to 100% of their capital is exempt from all taxation until the outstanding guaranty certificates are liquidated as herein provided. It is provided that national banks complying with the provisions of this act shall be exempt in the same way as state Yanks. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis -4(Amendments - 1960) Nullification of Act, Provisions for Chapter 22, Section 12, pp. 29-30. It is provided that if for any reason any one of the following provisions should be declared null ?,t void then all of the provisions of this act, reference to whicu are given below, are to become null 9; void and the bank guaranty act as it stood oreviously shall become in full force and effect: The suspension of Membership in fund - 1914 - Ch. 124, Sec. 33, 45a 4 46; and 1922 - Ch. 172, Sec. 51, 40, 41. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis The amendments to: The fund - Initial deposit - 1960 Ch. 22, sec. 2, o. 24; 19.172, Sec. 62: 1914 - Ch. 124, Sec. 154. The Fund - Assessments - 1930 Cl. 22, Sec. 3; 1922 - Ch. 172, Sec. 63 1914 - Ch. 124, Sec. 35. Liquidation - 1960 - Ch. 22, Sec. 4, pp. 25-261 1926 - Ch. 252, Sec. 1; 1924 - Oh. 176; 1922 - C. 172, Sec. 64; 1914 - Cn. 124, Sec. 36. The Fund, What it Covers - 1950 - Ch. 22, Sec. 5; 1922-Ch. 172, Sec. 36; 1916 - Ch. 207: 1914 - Ch. 124, Sec. 58. Interest hates - 1930 - Oh. 22, Sec. 6 - pp. 26-27; 1922 - Ch. 172,. Sec.37; 1916 - Ch. 207; 1914 - Ch. 124, Sec. 69. Depositors protection fund - 1960, Ch. 22, Sec. 6A, 6B. Surplus - 1930 - Ch. 22, Sec. 9, 10, 11, pp. 28-29. i'// )-44 I • • https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis • • • https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis in thi:. time such exempti property for taxati, ion,: as the Lank pays provided, each bank sh_ the valuation of the shares in the manner provided by Section 1 of Chapter 1 Laws of 1920, being section 8203 of Heminzway's Code 01 for the purpose of fixing the valuation on which state, county and municipal taxes shall be paid; provided that where banks existinE; under the national laws comply with the provisions of this Act, the basis for the taxation of the shareholders thereof shall be the same as for state banks. • • FrIOM NISSISSIFFI LAWS -1930 Chapter 269 • eV; 1"-') • -,t,7trtiv1,. house Bill ho. 949 total sum not to Bankinz Department outstanding and accumulated interest tneron, and for prompt payment of said bonds at maturity, principal and interest, there IL. • • https://fraser.stlouisfed.org 0' Federal Reserve Bank of St. Louis • • • https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 1 • • • https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis it"At; 74,4 CHAPTER 12 STATE OF MISSISSIPPI 25 CHAPTER 12 SENATE BILL No. 29 AN ACT for the protection of owners of guaranty cer ifieates by providing for the issuance and sale of bonds of the State of Mississippi to pay for outstanding guaranty certificates and repealing Chapter 269 of the Laws of 1930, and a? laws in conflict herewith. SECTION 1. Be it (fleeted by the Legislature of the State of Mississippi, That the Superintendent of Banks of the State of Mississippi, together with the Bond Commission created by Chapter 116, Laws of Mississippi, 1926, shall have the power, and is hereby authorized to have prepared and to issue the bonds of the State of Mississippi in a total sum not to exceed the amount of the guaranty certificates of the State Banking Department outstanding on the date of the issuance of said bonds and the accumulated interest thereon; and that the maximum amount of bonds to be issued under the provisions of this Act shall not be in excess of Five Million Dollars ($5,000,000.00). For the prompt payment of said bonds at maturity, principal and interest, there is hereby irrevocably pledged and dedicated, all the money which may be realized from the collection of assets of banks that failed prior to March 11, 1930 now being liquidated by the State Banking Department, together with all assessments and collections by the Superintendent of Banks, under and by virtue of the statutes of the State of Mississippi providing for assessments on the unsecured deposits of the State banks to secure funds with which to pay guaranty certificates outstanding; and the full faith and credit of the State of Mississippi are hereby irrevocably pledged to the payment of the principal and interest of said bonds. OF INTEREST—DENOMINATION—PROCEEDS. Said bonds shall be issued in the name of the State of Mississippi. and said bonds shall not sell below par, and shall bear interest at a rate to be determined by the Superintendent of Banks and the State Bond Commission, provided the interest on said bonds shall not exceed five and one-half (51 / 2%) per cent; and said interest being payable semi-annually. The Superintendent of Banks and the Bond Commission shall also have the authority to fix the denominations in which said bonds shall be issued, and the maturity or maturities of said bonds, provided, however, that said bonds shall mature serially or otherwise within a period of not more than twenty years from their date. Said bonds shall be sold in the manner prescribed by the Superintendent of Banks and the BONDS—RATE SEC. 2. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis CHAPTER 12 21i GENERAL LAWS OF THE Bond Commission. and the proceeds aris ing from the sale thereof shall be deposited in the Treasury Mississippi in a special fund to be denomina of the State of ted "Bank Guaranty Certificate Fund", and the money§ in said fund shall be paid to the parties entitled thereto only on cert ificate of the Superintendent of Banks in the manner After said bonds have been issued and hereinafter provided. sold of said sale deposited, as above provided, and the proceeds those owning guaranty certificates shall have the right to surr cates to the said Superintendent of Banks ender said certifiand to receive from the said Superintendent of Banks an orde r upon the State Treasury drawn on said "Bank Guaran ty Certificate Fund". but not for a greater amount than the actu tificate or certificates to the holder ther al cost of said cereof, and after sufficient proof of such cost, but plus any accumulated and unpaid interest on such cost at four (4(,;.) per the time such holder of such certific cent per annum during the actual owner thereof. Bonds issu ate or certificates was ed by this statute shall be eligible to secure public deposits of the State of Mississippi and all county, municipal and other subdivisions thereof. ASSETS OF BANKS IN LIQUIDATION. SEC. 3. Realization from the assets of all banks in liquidation shall be paid into a special fund esta blished for the payment of the principal and interest this statute, and shall be used sole of the bonds authorized by ly for the purpose of paying the interest on said bonds and the principal thereof as the same mature. If funds are availabl e, the Superintendent of Banks may, and whenever Twenty-f ive Thousand Dollars ($25,000.00) or more is available, shal l purchase the bonds authorized by this act in the market, than par. The Superintendent of but not at a greater price Banks and the Bond Commission may, in their discretion, rese rve an option on the part of the State of Mississippi to red eem said bonds on any terest payment date, on or afte r such period, as the Supe inrintendent of Banks and the Bon at par, or at such premium or d Commission may determine, of Banks and the Bond Com premiums as the Superintendent mission may deem expedient. OUTSTANDING GUARANTY CERT IFICATES MUST BE REGISTERED. SEC. 4. It shall be the duty of all own any and all outstanding guaranty certificers and or holders of registered in the office of the Superint ates to have the same endent of Banks of the State of Mississippi in a book prov ided for the purpose by https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis CHAPTER 12 STATE OF MISSISSIPPI 27 the State Banking Department, and where such a party offering to register any such outstanding certificates, who is other than the original payee named in said certificates, he shall be required to take oath, upon a form to be prescribed and furnished by the State Bankfng Department, stating the amount he paid for such certificate offered for registration and giving the name of the person, firm or corporation from whom secured, or is secured from the State Banking Department. together with a signed agreement, likewise on a form prescribed and furnished by the State Banking Department. that in the event all conditions herein prescribed are met, he agrees to accept in full, for his equity in any and all such certificates issued to other than himself, as original payee, the amount he paid for such certificate offered, plus four (4();-) per cent per annum during the time he owned such certificate, provided that the original payee named in each such certificate and each succeeding purchaser, if any, of each such certificate shall likewise receive an amount equal to the difference between the amount paid by him and the amount received by him for such certificate, plus interest at the rate of four (4T,) per cent thereon during the time he was the owner and holder of such certificate: provided that nothing in this act shall be construed to authorize the payment of more than par value and accrued interest at the rate of four (V.;) per cent per annum for any such outstanding certificate. Any person who shall make a false affidavit, or any false statement in the affidavit required to be made by the provisions of this section, shall be guilty of the crime of perjury. Nothing in this act shall require the re-registration of guaranty certificates heretofore registered with the Superintendent of Banks under the provisions of Chapter 269. of the Laws of Mississippi, 1930. Part of act unconstitutional not to affect whole act. SEC. 5. If any clause, sentence or section hereof shall be held to be unconstitutional. that shall not affect any othe) clause, sentence, or section of this act. -SEC. 6. Chapter 269 of the Laws of Mississippi. 1930 is hereby repealed. SEC. 7. This act shall take effect and be in force from and after its passage. Approved October 20th, 1931. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis ANENT. • -)1 1931 - For See phetT 1932 - Min under populatf • - Chapter 307 Ath approval of 7 -7ubseqent to Jum unsecured deposf - Chapter 2.5. ourt approval, when f tee-fourths efder deposits" agreements fl period of years. - Chapter 336. New Act_ Authorizes Superintendcr 'If the Coirt of Chancellor, to negotiate loans on as NOTE. No 1932 law relating to the deposit guaranty fw-H, arisinff, fron deposit guaranty. • roved April 2, 1934. 1934 - Chapter ih6 ew bankin- code, replacing 1914 law with all its amendments of subsequent years. Department of banking headed by Superintendent of Pa- ks rgplaced by department of bank supervision headed by state comptrollPr. Port:_or orTaw ocrtainin- to the deposit guaranty system is as follows: Bank guaranty laws repealed. Sec. 116. That the state bank guaranty law is, in every particular repealed, and the annual assessment of one-fourth of one per cent of the bank's average unsecured deposits; the three per cent annual assessment on the bank's exempt surplus, -Ind the requirement of depositing bonds with the state treasurer for a full compliance with the guaranty laws, are hereby repealed, and the state treasurer is authorized, empowered and directed to return to the sevefl bank5 corporations bonds and other collateral heretofore deposited with said state treasurer. Any funds now on hand or hereafter collected from any and all bank guarani, assessments heretofore imposed shall be deposited with the state treasurer and place( in the general funds of the state of "Ti ssissippi. 111 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis dit ; ii.eifil l• 4° 'l # ' ''';'/ , ,; t---etçL - .. 1 /' / /' -i/ , / I-1 /r •. /k /d icer , / 7/,'„,o. ,-- // If i (/ , .A. ) ' : 2 ' 41 r I I / t el'# -1' • -1' .A. ...--tt42! 21' X- t Vt 4... \ /4-7.‘' 1- / ..:114-1 ,, ,. , , . ii ....frA-41.44e1-406*--C•e, .. l-4--0112,4.-9- ;-, 1.4.04 1 i p,,„,&-i .i,v...--- As, --474, i,/,,f7/) o -(t—i---4,' 44;.- k -i-,,-,4_,, /, ,_,/ A.51 A.467 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis ar-ov-r- ry. .._ , f41 .--, 1, - e/I 44 .4x , /41 4-4 • .__ I 7/ 1 i 1-27-55 Governor's Message Upon Passage of the Kyle Banking Bill (Mississippi House Journal, 1914) In his message Lhe Governor brought out that this was a splenflil law but thought it might be noteworthy to point out that, "...bank examiners are absolutely czars so far as the bank is concernel anl have power to place any bank, solvent or insolvent in liquiMation In the State, if they thought it shoulM be none." He recommen(10 that a separate provision be passer to the effect that "if the bank examiners shoulsi urrIertake to liquiflate any bank, an officers shoull not flesire it, they shoul,i be permitte,1 to file with the bank examiners a solvent bonl for 25 percent greater then all their liabilities awl obtain an injunction to prevent their liquilation, as it woulel be possible for examiners to liquiAate a solvent bank." https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis • https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis • • _ C:77T DECISIONS- MISSISSIPPI DEPOSIT '_. A. R. BUTTS, IN MISSISSIPPI LAW JOMRNAL, HOVE1 -7-ER 192'; 0 r eA, r 41 1..4" 71 . Anm.r(sTre n7 Re Section 38 - defining what deposits are - --."---,' ,..--Anderson et at., Bank Examiners, vs. Owen et al., 112 Miss. '76; 73 so. 286K vanderson, State Bank Examlner, vs. "Albourn, 111 Miss. 81; 71 So. 682 t/rank of Commerce et al. vs. Clark, Sheriff and Tax Collector, 11i Iss. 850; 75 So. 595 ,--Wardlaw, State Biink Examiner, vs. Planters Bank of Clarksdale et al, 131 Mps. 93;v, i 95 So. 135 L. , lildkon, State Bank Examiner vs. Jo on, 134 rtss. 329; 99 So, 369 6...... 4'nderson, State Bank Exariner, vs. rates et.all 15Yr Miss. li0; 99 sp. 499 1r ,,, . Anderson, State Bank Examiner, vs. T. E. Gordon, 134 Miss. 639; 99 So. 50] VE.1 ..-...--- ',094nderson, State Fakk Examiner vs. Bank of Tupelo, 100 So. 179 . 1,''Love. Supt. of Banks, vs. Murry, State Treasurer, 100 So. 2771134.11 /Pitts vs. Peoples Bank of Baldwin, 102 So. 279 vton 11.e Section 40 - withdrawal of bonds or money (initial deposit) in voluntary 14-" "7 1,-- k-- 10/Mississipni Banking Department et at., vs. Adams, 102 So. 70 Re Constitutionalitycf the deposit guaranty law in Mississippi v/Bank of Oxford vs. Love et al.,41F-'4ss. 699; 72 So. 133 Bank of Oxford et at. vs. Love et al, Bank Examiners of the State of M-Lssissippi, 250 U.9. 603 • U1TT7D STATUS S"P7771E 7(77T T-J771.SICT - Bank of Oxford s. Love (from 7 Submitted March 27, 121E... Decided November 101 :15'1.9. 2onstitutional law - inpairinU contract nl-liL;ations The ovliLation of the state's undertakir: in a :11-1k, that "the business of said bank shall he ' 7tockholders md-r such rules of Taws and regr' Lo adopt, provided the same be not i', conflic4_ o. States or of this shtite,', was not nconstitutionally enactment of legislation- providing: for reasonable examination tithorized officrs of the state banking department created by such7 egislatior, and for the enforced annual contribution to the expenses such department of lit, pf 1 per cent of the bank's total assets. -ustice Mc-eynolds affirminL: action of the Y.ssissippi State Suprnmn .rse of opinon it Y-17 noted that the rank ceryford as incor7or _cial act of the Mississippi annrovnd' -7ra 1a701%, 127?. &t, cice of opinion: r'lhi_ly.'he bill proceeds u:vn - he theory that the bank's affars are wholly e2ror 4 nterfer(ince by legislative direction, the only: ast or immediately prcbable ,r6n-s adequately complained of are enforced contribution to expense of the ban' department and threats by defendents to make examinations and reports. And we it clear that no impairment of the corporate charter has or will result from reL. alle examinations and reports by duly authorized officers and the small prescribed a.yrients. It is unrecgssary, WaTsTder other distinct nrovisiens of the statute,,, r, of course, we intimate no , rt. - if concerninr4pem4 1, / II https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 1.4•-• //A DECISIONS OF THE MISSISSIPPI SUPREME COURT Vol. ia$ - 1916 • 71 . •) v. OWEN ET ALL. ANDERSON ET AL., BANK EXAMINE 286, South. Division B.) (73 i;i p4'fre?i, Banks and Banking. Insolvency. Claims. Guaranteed deposits. On the insolvency of a bank the deposits of which are guaranteed under the state banking law (Laws 1914, chapter 124), a depositor has a claim for the full amount of his deposits, undiminished by a check against such deposits for sight exchange, on which sight exchange payment was refused' on account of insolvency and liquidation proceedings of the bank, in the ab-i sence of proof by the liquidators that the sight exchange was in fact accepted as payment of the checks. ANDERSON, STATE BANK EXAMINER, v. BASKIN & WILBOURN, 714 1_0?1 Vol. 114 - 1917 '491i-trfil/7 $. Banks and Banking. Insolvency. Distribution of assets. Statute. Under the Bank Guaranty Act, Laws 1914, Chapter 124, the general creditors are entitled to participate in the distribution of the assets of an insolvent bank along with depositors; the depositors being pro cted the guaranty pr9y,4.sio9s of the act. Laaa. L,.4 ,4, 4V , 44-71,j401 s/- " -//**•!Ii.,att; 7t,/ 44, ^(41 ke„.Ar , , • , 640te r•t Jo. W E BANK EXAMINER, v. PLA FEST/BANK OF CLARKSD LE e (95 South. 135. In Dane. No. 22839.) Vol. 131 - 1922-23 92, // , /4Z.. Banks and Banking. Municipality entitled to guaranty certificate from state banking department for funds deposited in insolvent bank not qualified as a depository "secured." Where public funds of a municipality are deposited in a bank which has not qualified as a depository, as provided in Chapter yo of Hemingway's Code, this deposit is not "Otherwise secured," as provided in section 3506 Hemingway's Code, and the municipality is entitled to a guaranty certificate from the state banking department, where the bank is being liq dated by thp depar me (4016.1 1.41 1,111-re fr /144 "t-- #4. 6,, • 0,A LA 4•1•449 / 1 1 Or 4 147 1.r.fr L • "Ir' isii-444, 4- e: •• 4 tt,.i - 17J(. 111 Yiss. 699 72 So. 133 I "w)‘ • The state bankina act of 1911i (Las 1911, c. 121), providing fcbr the examination of hanks and their liquidation in case of insolvency, or if shall be doing business on less then the minimum capital allowed, etc. exercise of the police power and applies to a lank chartered by prior r; act declarins that its business shall be confided to and controlled by stockholders under such rules of law and requirements as the company may see fit to adopt, provided the same be not in conflict with the state and federal Constitutions, for, by chartering the bank, the Legislature could not we' its right to exercis(NOTE. In this case ti,ere as no of unconstitational.tf of law as such, only A4h.resoect to its applicability to,a bank operatinF under a speciel chart4:11 iTes variousCecislons r specting the police rower, inc117dinL; . Supreme O_)uttdecisions in Oklahoma and Nebraska. "Therefore, following the sound and safeeonclusions reached in the fore7oinF, authorities, weflnd the law https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis and not 7.i creditors uf the depository. The Depository Act (Acts 190 ),, when:'ut in operation, supercedes and an' 1 - VI, Code 1906, sec. 3U5. The fact that a tax collector accepted a pri law toEecure a deposit madeby him of the public funds ,Inds as fixed ' the status of the deposit of the public 1 906, sec. 34F5. JOHNSON, State Bank Examiner, V. JOHNSON. March 24, 1924. 134 Miss. 729 99 so. 369 ...a s)ccial deposit of money, or money7dd to the hank for the specific purpose ' of paying a note made payable at the bank by its terms, is guaranteed under the act, and such person so paying the money for such purpose is entitled to a certif icate of guaranty where the bank is beinL liquidated by the state bank ex-aminers. ANDERSON, State Dank Examiner, V. YATES et al. April 7, 1924. 13ss. flu 99 So. 1:99 Where a tire certificate of deposit is issued by the president of a banl,: Who is in charge :pf the bank's affairs and, authorized to issue such certificates, in ayment of the president's prsonal check drawn on such a bank, the holder of such check knowing nothing of the state of the president's account, but acting in good faith and by means of w hich transaction he loses title to cotton sold to the president and loses his legal rights to-rotect his interest by legal suizure and process, the transactions constitutes a "deposit" within bhe meaning of sect . 39, chapter 207, Laws of 1919...and is guaraiteed under said act. 1.311 Miss. 639 99 So. 501 sae. decision and YATES v ANDERSON same as is dates case Opinion To surnary. 7.7. ANDERSON, State Bank Examiner, v. T.E. GORDON Apr 7, 1924. 135 74ss: 351 100 S. 179 L'a.,_31lier's check" is a bill of exchange drawn by a bank upon itseaf, and a cashier's check is guaranteed-"7! act of issuance. accepted =EPSON, State Bank Examiner v. FAIT OP TUPELO. May 12, 1921. Supt of E,anks v. MURRY, State Treasurer. June 2, 1924. 135 Miss. 749 loo se. 277 Money heltnging to the state, deposited in a bank which had not qualified r11,1(4.. statr, cirTos4 to,-7, is ,,roteoted 17 the stn.tr, /7.P.nlr https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis *3* DECISIONS MISSISSIPPI STATE SUPPEYE COURT PITTS v. PEOPLE'S BANK CF BALDNIN Dec. 22, 1924. 237 niss. 240; 102 So. 279 One who depnsited funds at solicitttion of person to Whom bank had agreed to make loan if he could secure additional deposits, and received therefore certificates providing for payment of h per cent interest, and subsequently, in good faith, received a bonus, believing it to have been paid by suchnerson, was not depreived ofrrotection of State Guaranty Law....since in such case there was no agreement between -epositor and bank for payment of more than h per cent. Where certificates of deposit for one were surrendered, and certificates for following year, providing for payment of 14 per cent. interest were issued, the funds evidenced by the new certificates were within rotection of State Guaranty Law, even if moee than h per cent was received during preceding year...since the deposits for the we years did not constitute one continuous transaction. MISSISSIPPI BANKING DEPARTMTNT et al v. ADAMS • Dec. 8, 1924• 127 YiSS0 122 102 SO. 70 T.11en a bank...voluntarily liquidates and goes out of business, after having i , paid depositors in full, and paid all assessments made against it uhiltit was doing business...its liquidating agent is entitled to recover from the state treasurer all bonds or money it has deposited with him under the provisions of 1914 add 1910 Section 40 of this act is plain and inambiguous these acts. (NOTE. Banking department had contended not entitled to return of 'bonds until liabilities of all guaranteed banks i- liquidation had been paid in full--i.e. that in effect bank voluntarily liquidating responsible for its reittive share of losses in all failed banks up to that time, even though assessments sufficient to cover such losses had not yet been made). LOVE, Mtn SUPEIETENDEM OF bAhltS4 CITIZENS' BANK AND TRUST CO. OF NAPES Oct. 5, 1925. 140 miss. 585, 105 so. ,7/4 Though surety, which signed bank's bond as depository of country's public funds, hes no authority to become such surety, deresite of such funds were thereby "otherwise secured" by reason of estoppel to deny liability to the country, so the lei. they were not guaranteed by the state bank giaranty fund, and the bank ras not liable t assessment thereon, as "guaranteed deeosits" for the debefit of such fun v. LOVE, S7Pr9INT7N7777 or BN-Is FT AL, 147 Miss. 13 113 So. 335 contracted with the its depositor and put become levee to bank board Where a marketable the bond, a personal bond' part o and securities for up bonds and other board are individual levee of th deposits and sureties, he bank the signed by the bank compelled to issue not be secured"...and guaranty fund may "otherwise put up by the securities funds from the certificates for the not collected guaranty levee board. bank to the Whore a personal bond is given by a bank becemine a depository and is accepte by the levee board, it can recover free the bank and the sureties on its personal bond. where securities and bend are given and accepted by the levee board, and a ban becomes a depository, and funds are thus 'secured, a court will not construe the Ba :)1=0Fitory Guaranty Law to cover the balance due after exhausting the securities. BOARD 07 LEVEE C0MT7-7. https://fraser.stlouisfed.org 1. Federal Reserve Bank of St. Louis CITY or J..7iss. 757', 13_ - 1. State exempting surp17:.-, certificates are liquidator', ("oos n. . amendments by reference to title only. 2. General law may be suspended by another 3. Statute suspending bank guaranty law until general, and not prohibited by Constitution. Law id "general" when it operates unif.rmly on all places, or thirrs re;uiring legislation peculiar to class 5. Statute exempting surplus of banks from taxation until certificates are liquidated does not violate oonstitutiona] special tax exemption laws. 6. Power of exemption from taxation is withinlegislative discretion, subject to 11imitation that exemption shall not be arbitrary. 7. • Only limitation upon legislative power toexempt property from taxation is that so-oprinciple of public policy must support presumption that public interest will be subserve0, ly\exemPtion, and classification ‘f pronerty exempted must be based or so-e real difference bearing proper relation to object sought to be acc-n-Tlislr. Interpretation of constitutional provisions must not'n too literal. 9. Statute exempting surplus of banks fro- taxation until outstanding guaranty certificates are liquidated does not violate constitutional provisions recpectin uniformity of taxation. 10. Statute exe-Tting surplus of banks from taxation until outstanding guaranty certificates are liquidated dOes not violate constitutional provision respecting taxation of banks and banking cap ital. at statute was invalid because atterm7lnL to 11. City could not raise point state banks by lejslaton. regulate national • https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Digests of Court D'- sins bearing on the deposit c'mran',, Fron Second Decennial Digest, American Digest Syster,, 1907 to 1916, vol. • Banks and Banking - Key 63, p. 1339; and key 85, p. 1366 pLi ss. 1915 Code 1906, pee. 1169, as amended by Laws 1912, c. 211, punishil„ receiving od deposits in ineolvent banks, is repealed by State Banking Law, 7,--. ' --State c. McLean, 66 So. 772; 109 M1ss.526. (N4ss. 1915 Indictment charging officers of an insol-ent tank with receivi deposits in violation of Laws 1914, c. 124, sec. 52, must_allege that they knew bank to be insolvent.--State v. McLean, 69 So. 772; 109 Miss. 526 From Third Decennial Digest, 1916 to 1926, vol. Banks and Banking - Key 15, pp. 4. 445-4V. (miss. 1916) Under the state banking law (Laws 1914, c. 124), a depositor has a claim on a bank's insolvency for the amount of his deposits, undiminished by a check for sight exchange, on which sight exchange payment was refused because of liquidation proceedings of the bank, in the absence of proof that the sight exchange was accepted as payment of the check.--Anderson v. Owen. 73 so. 286, 112 Miss. 476. VI (Miss 1917) Under Bank Guaranty Act4f23, 24, 36, 38, 59 and 60, general creditors are entitled to participate with depositors in the distribution of the assets of an insolvent bank, the depositors being guaranteed by means of the guaranty fund. --Anderson v. Baskin & Wilbourn, 74 So. 682, 114 Miss. 81. (Miss. 1923) Where the public funds of a municipality are deposited in a bank which had not been qualified as a depository under Hemingway's CodsA4191-4255, such deposit is not "otherwise secured" as provided by section 3596, and the municipality is entitled to a guaranty certificate from the state banking department, under Laws 1914, c. 124, 36, where the bank is being liquidated by this department.--Wardlaw v. Planters' Bank of Clarksdale, 95 So. 135, 131 Miss. 93. Where a bank redeposited county money in another bank, which subsequently failed, the depositing bank 13 entitled to receive from the state banking department its guaranty certificate. --Id. (Miss. 1924) Under Hemingway's Code43596 (Laws 1916, c. 207, 38), providing that all deposits not otherwise secured, and all cashier's checks, certified checks, or sight exchange issued by banks operating under this law shall be guaranteed, the guaranty provided for not applying to a bank's obligation as indorser on bills rediscounted, nor to bills payable, nor to money borrowed from its correspondents or others, nor to deposits bearing a greater rate of interest than 4 per cent, per annum, a special deposit of money, or money paid to the bank for the specific purpose of paying a note made payable to the bank by its terms, is guaranteed under the act, and such person so paying the money for such purpose is entitled to a certificate of guaranty where the bank is being liquidated by the state bank examiners. --Johnson v. Johnson, 99 so. 369, 134 Miss. 729. (Miss. 1924) Where a time certificate of deposit is issued by the president of a bank, in charge of the bank's affairs and authorized to issue such certificates, in payment of the president's personal check drawn on such bank, the holder of such check knowing nothing of the state of the president's account in the bank, but acting in good faith and by means, of which transaction he loses his legal rights to protect his interest by legal seizure and process, the transaction constitutes a "deposit" under Laws 1916, c. 2074° 38 (Hemingway's Code, (t 3596), and is guaranteed under said act.--Anderson v. Yates. 99 So: 499; Anderson v. Gordon, 99 so. 501, 134 Miss. 639. (Miss.1924) Under Hemingway's Code, 0596, a cashier's check is guaranteed. Anderson v. Bank of Tupelo, 100 So. 179v, 135 Miss. 351. (Miss.1924) Money belonging to the state, deposited in a bank which has not qualified as a state depository, is protected by the state bank guaranty fund. --Love v. Murry, 100 So. 277, 135 Miss. 749. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Si '0 - - 2 TississipFi .aranty fard- Th -7.rd 7,Aenni21 (Miss.1924) When bank organized under Laws 1914, c.124, as amended by Laws 1916, c.207, voluntarily liquidates after payment to depositors in full and payment of all assessments made under Hemingway's Code, 3598, its liquidating agent can recover from state treasurer all bonds or money deposited with him under such statutes.--Mississippi Banking Department v. Adams, 102 So. 70, 137 Miss. 122. (Miss.1924) One who deposited funds at solicitation of person to whom bank had agreed to make loan if he could secure additional deposits and received therefor certificates providing for payment of 4 per cent, interest, and subsequently, in good faith, received a bonus, believing it to have been paid by such person, was not deprived of protection of State Guaranty Law, Hemingway's Code, 3596, excepting from protection thereof deposits bearing greater rate of interest than 4 per cent, since in such case there was no agreement between depositor and bank for payment of more than 4 per cent interest. --Pitts V. People's Bank of Baldwin, 102 So. 279, 137 Miss. 240. Where certificates of aeposit for one year were surrendered,and certificates for following year, providing for payment of 4 per cent, interest were issued, the funds evidenced by the new certificates were within protection of State Guaranty Law, even if more than 4 per cent. was received during preceding year, in violation of Hemingway's Code,e 3596, since the deposits for the two years did not constitute one continuous transaction.--Id. (Miss.1925) Though surety, which signed bank's bond as depository of county's public funds, had no authority to become such surety, deposits of such funds were thereby "otherwise secured" by reasor of estoppel to deny liability to the county, so that under Hemingway's Code,f 3596, and Ilemingway's Code Supp. 1921, 3593, they were not guaranteed by the state bank guaranty fund, and the bank was not liable to assessment thereon, as "guaranteed deposits" for the benefit of such fund.--Love v. Citizens' Bank & Trust Co. of Marks, 105 so. 484, 140 Ifi,ss. 585. Bank: and Bapting - Key 44, P. 473 (*Tiss. 191b) Laws 1914, c. 1211„ sec. 59, incr,--asin,liabil"ty of stockholder of bank to extent of par value of his stock, but at the same time maranteeing payment of depositors by state, cannotbe said to do stockholders an "iniustige" under Const. pir. 178.--Pate c. Bank': r Newton, 77 So. 601; 116 'Ass. 666. Laws 1911, c. 121, sec. 59, increasing liability of stoqkholders of banks, . imposes liability upon stockholders of banks incorporate before or after its passage, 114,t, only as to deposits actually made after its passage.--Id. Danks and Banking - Key h7 (2) - page 177. (Mi ss. 1924) Under Hemingway's Code, sec. 3619, stockholders double liability accrues and is fined at full amount of stock when bank i s put in liquidation, and it is reasonably apparent that assets will not pay depositors.--Board of Balk Examiners v. Granada Bank, 99 So. 903; 135 4ss. 2h2. 1890, • Bakks and Banking - Key hp ConstItutional and statutory provisions. p. 439 (U.S. Sup. Miss. 1919) Act of Mississippi of March 9, 1911 (Laws 1911, c. 124) held valid.--Bank of Oxford v. Lovel _h0 S. Ct. 22, 250 0.q. 603, 63 L. Ed. 1165, affirming judgment 72 So, 133, 111 Mlss. 699, 8 A.L.R. 891. NJ No abstract apllears in either the Second Dicennial Digest nor (NOTE. the Third Dicennial Digestof the Mississippi Supreme Court dec'sion, which was rendeded on June 19, 1916) 411 NOTE For selection of the abstracts quoted above from the Second and Third Decennial D4gests,Athe entire sections relating to Banks and Banking have been scanned, and all nississippi cases read. The great majorit: of the cases read are omitted. Such cases include most of -Lose referring specifically to laws enacted prior to 1914, and cases relating to such stbjpcts as tiqe fpllorimxithout a specific reference to thelaw of 151h, or an indicgt9Rstha theiNsillAgefnvolved in 04-' than application to specific lams circumstances war not involving any genera principles of interpretation: bank directors' or officers' liability; srecia" deposits or trust funds; particular iterrs in receivership cases; protest and collrtion practices; handling of drafts. e,14 (by nAie,pir . Xj.4.10(2, https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Digests of Coart cis-lc/Ts - 7,:issfnsirpf guararty fund - Fourth Dicennial Digest From I-tutth Decennial Digest. 122' to 4 2-nks and f'aftkinL - Ke1 L - ConstitutiLral and statutory pro-isYsns p. 790 Miss. 1931. State Yank guaranty statuto rrovidir- for issuance nf nonirterestbearing guaranty certificates held valid,(Ia -.:s 193P, c.2,2)7 (reve T. rppgulf, • z A 13 clo. 223, 16n jj/rfiernfICI 590. WiE-771.0,-.0-'44'ovr4 - '3.4444 - Key 15- STfet:r4 P:-s5ts rf s'curties p. 794 Mp▪ s 1927. Deposits securred by rarketa'le sTeurit 7 -sn -alcci ore "otherwise secured" 'Ind .r statute, and issia-.ce of guaranty certificates fnr funds )t collected fro-,_socar't: crpelled...Foard of Tx-vee Corn's v. Love, 113 SO. 335, 117 S3. 1. Pank Depositor- ('-uaranty Law does net cover balance duo after exhausting sefourit '-,-drr-os'tory to sec' rP dPposits. (sare case). Mi-ss. 1929. Law i-posin: liabil'Ay on s' strctly construe'. -ellott v. Love. 119 Apb, I2e - Ley 47 (1) r. N!3. miss. 1926. Stockholder of insolvent ban:: reg Carly com° ddr law, though without his knowledge, is subect to double liability. -insolvent bank is liable for interest from time demand is mach.-- nr horn for double liablli-. Kent v. Love, 106 Sc. 772, 1111 Miss. 523. - Key 85 (2) pp. 1153 and 1]84 Miss. 1230. Statements to denositors of tanking department officers that solvent held competent to show bark officer's good faith in receiving deposits. T' sustain convision for receitin deposit 4 r rsolvent tank, prrof must show defenden. knell or had good reason to believe banks was insolvent. In prosecution fo-r deposit when bank was insolvent, inquiry relates to bank's solvency when deposf, received. Facts learned while administerinL jnsolventg bank's affairs must rela' back to date of dennsit to sustain conviction for receivinc deposits after insolver mcCraine v. Statc, 130 So. 295, 158 Miss. 156. Miss. 1933. In prosecution of tanker for receiving money on deponit was insolvent, state's evidence that assets consitinT- of deposit certii under deposit guaranty law were worth much less than face value held ilproperly excluded, notwithstandin: statute authorizing issuance of baonds to pay outstanding certificates, where such bonds had not leen sold--State v. Johnson, lF So. 389, 591. 166 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis