Full text of National Banking Law Revisions of 1959

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73

STAT.]

PUBLIC LAW 86-230-SEPT. 8, 1959

467

Public Law 86-230
AN A C T

September 8, 1959

To amend the national banking laws to clarify or eliminate ambiguities, to repeal
certain laws which have become obsolete, and for other purposes.

[H. R. 3159]

Be it enacted hy the Senate and House of Refresentatives of the
United States of America in Congress assembled^ That (a) the para- ^^Nationaibanking
graph designated "Seventh" in section 5136 of the Revised Statutes Revision.
(12 U.S.C. 24) is amended by striking out "or the Home Owners'
Tjoan Corporation".
(b) Section 23A of the Federal Reserve Act (12 U.S.C. e37lc) is '•s stat. i83.
amended—
(1) by striking out "the Federal Home Loan Banks, or the
Home Owners' Loan Corporation" in the second paragraph and
inserting in lieu thereof "or the Federal Home Loan Banks"; and
(2) by striking out ", or the Home Owners' Loan Corporation"
in the third paragraph.
SEC. 2. Section 5168 of the Revised Statutes (12 U.S.C. 26) is
amended by striking out "at least fifty per centum" and inserting in
SEC. 3. Section 2 of the Act of May 1, 1886 (ch. 73, 24 Stat. 18; 12
U.S.C. 30) is amended to read as follows:
"SEC. 2. Any national banking association, with the approval of the
(Comptroller of the Currency, may change its name or change the location of the main office of such association within the limits of the city,
town, or village in which it is situated. Any national banking association, with the approval of the Comptroller of the Currency, may
change the location of the main office of such association to any other
location outside the limits of the city, town, or village in which it is
located, but not more than thirty miles distant, by the vote of shareholders owning two-thirds of the stock of such association. A duly
authenticated notice of the vote and of the new name or location
selected shall be sent to the Comptroller of the Currency; but no change
of name or location shall be valid until the Comptroller shall have
issued his certificate of approval of the same."
SEC. 4. Section 5140 of the Revised Statutes (12 U.S.C. 53) is
amended to read as follows:
"SEC. 5140. All of the capital stock of every national banking assocation shall be paid in before it shall be authorized to commence
business."
SEC. 5. Section 5141 of the Revised Statutes (12 U.S.C. 54) is
repealed.
SEC. 6. Section 1 of the Act of May 1, 1886 (ch. 73, 24 Stat. 18),
is repealed.
SEC. 7. Section 5151 of the Revised Statutes (12 U.S.C. 63) and
section 23 of the Federal Reserve Act (12 U.S.C. 64) are repealed.
SEC. 8. Section 2 of the Act of June 30, 1876 (ch. 156, 19 Stat. 63;
12 U.S.C. 65), is repealed.
SEC. 9. Section 5149 of the Revised Statutes (12 U.S.C. 75) is
amended to read as follows:
"SEC, 5149. When the day fixed in the articles of association for the
regular annual meeting of the shareholders falls on a legal holiday
in the State in which the bank is located, the shareholders meeting
shall be held, and the directors elected, on the next following banking
day. If, from any cause, an election of directors is not made on the
day fixed, or in the event of a legal holiday, on the next following
banking day, an election may be held on any subsequent day within
sixty days of the day fixed, to be designated by the board of directors,
or, if the directors fail to fix the day, by shareholders representing two-

R^P^^^^.

12 use 53.
38 Stat. 273.

458

PUBLIC LAW 86-230-SEPT. 8, 1959

[73 S T A T .

thirds of the shares, at least ten days' notice thereof in all cases having
been given by first-class mail to the shareholders."'
61 Stat. 202.
gj,(. jLQ Section 5202 of the Kevised Statutes (12 U.S.C. 82) is
amended by striking out the paragraph designated "Sixth" and inserting in lieu thereof the following:
^2 ^xj*s c'^^Uii
"Sixth. Liabilities incurred under the provisions of the Federal
"°t«Deposit Insurance Act."
SEC. 11. The second sentence of section 5211 of the Revised Statutes
(12 U.S.C. 161) is amended by striking out "five" and inserting in
lieu thereof "ten".
SEC. 12. Section 5213 of the Revised Statutes (12 U.S.C. 164) is
amended by striking out "either of the two preceding sections" and
inserting in lieu thereof "section 6211 of the Revised Statutes".
vou*ng''ma'jorit1r!'^'
SEC. 13. Exccpt as otherwisc specifically provided by law, or by the
articles of association of the particular national banking association,
the articles of association of a national banking association may be
amended with respect to any lawful matter, and any action requiring
.
the approval of the stockholders of such association may be had by the
approving vote of the holders of a majority of the voting shares of
the stock of the association obtained at a meeting of the stockholders
called and held pursuant to notice given by mail at least ten days prior
to the meeting or pursuant to a waiver of such notice given by all stockholders entitled to receive notice of such meeting. A certified copy of
every amendment to the articles of association adopted by the shareholders of a national banking association shall be forwarded to the
Comptroller of the Currency, to be filed and preserved in his office.
SEC. 14. The provisions of all Acts of Congress relating to national
banks shall apply in the several States, the District of Columbia, the
several Territories and possessions of the United States, and the Commonwealth of Puerto Rico.
SEC. 15. Section 5220 of the Revised Statutes (12 U.S.C. 181) is
amended by adding after the first sentence the following new sentence:
"If the liquidation is to be effected in whole or in part through the
sale of any of its assets to and the assumption of its deposit liabilities
by another bank, the purchase and sale agreement must also be approved by its shareholders owning two-thirds of its stock unless an
emergency exists and the Comptroller of the Currency specifically
waives such requirement for shareholder approval."
SEC. 16. Section 1 of the Act of June 30, 1876 (ch. 156, 19 Stat. 63;
12 U.S.C. 191), is amended by striking out ", and enforce the personal
liability of the shareholders, as provided in section fifty-two hundred
thirty-four of said statutes".
SEC. 17. The second sentence of section 5234 of the Revised Statutes
(12 U.S.C. 192) is amended by striking out the semicolon after the
word "direct" and all that follows and inserting in lieu thereof a period.
Receiverships.
g^^^. j^g Scctioii 3 of the Act of Juue 30,1876 (ch. 156,19 Stat. 63; 12
U.S.C. 197), is amended to read as follows:
"Si<x\ 3. (a) Whenever any national banking association shall have
been or shall be placed in the hands of a receiver, as ])rovided in sec12 use 192.
^^Qj^ fifty-two hundred and thirty-four and other sections of the Re64 Stat. 884.
yiscd Statiites of the Ignited States and section 11(c) of the Federal
12 use 1821. Deposit Insurance Act, and when, as ])rovided in section fifty-two
12
' " 'u"s"e 194.
*"'
hundred and thirty-six of the Revised Statutes of the United States,
there has been paid to each and every creditor of such association
whose claim or claims as such creditor shall have been proved or allowed as therein prescribed, the full amount of such claims, and all
expenses of the receivership, the Comptroller of the Currency or the
Federal Deposit Insurance Corporation, where that Corporation has
been appointed receiver of the bank, shall call a meeting of the share-

73

STAT.]

PUBUC

LAW 86-230-SEPT. 8, 1959

holders of the association by giving notice thereof for thirty days in
a newspaper published in the town, city, or county where the business
of the association was carried on, or if no newspaper is there published, in the newspaper published nearest thereto. At such meeting
the shareholders shall determine whether the receiver shall be continued and shall wind up the affairs of the association, or whether an
agent shall be elected for that purpose, and in so determining the
shareholders shall vote by ballot, in person or by proxy, each share of
stock entitling the holder to one vote, and the majority of the stock
in number of shares shall be necessary to determine whether the receiver shall be continued, or whether an agent shall be elected. In
case such majority shall determine that the receiver shall be continued, the receiver shall thereupon proceed with the execution of the
trust, and shall sell, dispose of, or otherwise collect the assets of the
association, and shall possess all the powers and authority, and be subject to all the duties and liabilities originally conferred or imposed
upon such receiver so far as they remain applicable. I n case such
meeting shall, by the vote of a majority of the stock in number of
shares, determine that an agent shall be elected, the meeting shall
thereupon proceed to elect an agent, voting by ballot, in person or by
proxy, each share of stock entitling the holder to one vote, and the
person who shall receive votes representing at least a majority of stock
m number of shares shall be declared the agent for the purposes hereinafter provided; and when such agent shall have executed a bond
to the shareholders conditioned for the payment and discharge in full
or, to the extent possible from the remaining assets of the association,
of each and every claim that may thereafter be proved and allowed
by and before a competent court and for the faithful performance of
his duties, in the penalty fixed by the shareholders at such meeting,
with a surety or sureties to be approved by the district court of the
United States for the district where the business of the association
was carried on, and shall have filed such bond in the office of the clerk
of such court, the Comptroller and the receiver, or the Federal Deposit Insurance Corporation, where that Corporation has been appointed receiver of the bank, shall thereupon transfer and deliver to
such a^ent all the uncollected or other assets of the association then
remaining in the hands or subject to the order and control of the
Comptroller and such receiver, or either of them, or the Federal Deposit Insurance Corporation; and for this purpose the Comptroller
and such receiver, or the Federal Deposit Insurance Corporation, as
the case may be, are severally empowered and directed to execute any
deed, assignment, transfer, or other instrument in writing that may
be necessary and proper; and upon the execution and delivery of such
instrument to such agent the Comptroller and such receiver or the
Federal Deposit Insurance Corporation shall by virtue of this Act
be discharged from any and all liabilities to the association and to
each and all the creditors and shareholders thereof.
" ( b ) Upon receiving such deed, assignment, transfer, or other
instrument the person elected such agent shall hold, control, and dispose of the assets and property of the association which he may receive
under the terms hereof for the benefit of the shareholders of the association, and he may in his own name, or in the name of the association,
sue and be sued and do all other lawful acts and things necessary
to finally settle and distribute the assets and property in his hands,
and may sell, compromise, or compound the debts due to the association, with the consent and approval of the district court of the United
States for the district where the business of the association was carried
on, and shall at the conclusion of his trust render to such district
court a full account of all his proceedings, receipts, and expenditures as
32716 O-60—32

459

Ef/"t*i

Election.

460

Proceeds of assets, distribution.

64 Stat. 873.

Consolidation.
40 Stat. 1043.

PUBLIC LAW 86-230-fiEPT. 8, 1959

[73

8T A T .

such agent, which court shall, upon due notice, settle and adjust such
accounts and discharge such agent and sureties upon such bond. In
case any such agent so elected shall die, resign, or be removed, any
shareholder may call a meeting of the shareholders of the association
in the town, city, or village where the business of the association was
carried on, by giving notice thereof for thirty days in a newspaper
published in such town, city, or village, or if no newspaper is there
published, in the newspaper published nearest thereto, at which meeting the shareholders shall elect an agent, voting by ballot, in person
or by proxy, each share of stock entitling the holder to one vote,
and when such agent shall have received votes representing at least a
majority of the stock in number of shares, and shall have executed a
bond to the shareholders conditioned for the payment and discharge
in full or, to the extent possible from the remaining assets of the
association, of each and every claim that may thereafter be proved
and allowed by and before a competent court and for the faithful
performance of his duties, in the penalty fixed by the shareholders at
such meeting, with a surety or sureties, to be approved by such court,
and file such bond in the office of the clerk of that court, he shall
have all the rights, powers, and duties of the agent first elected as
hereinbefore provided. A t any meeting held as hereinbefore provided
administrators or executors of deceased shareholders may act and
sign as the decedent might have done if living, and guardians of
minors and trustees of other persons may so act and sign for their
ward or wards or cestui que trust. The proceeds of the assets or
property of any such association w^hich may be undistributed at the
time of such meeting or may ba subsequently received shall be distributed as follows:
"First. To pay the expenses of the execution of the trust to the
date of such payment.
"Second. To repay any amount or amounts which have been
paid in by any shareholder or shareholders of the association
upon and by reason of any and all assessments made upon the
stock of the association by order of the Comptroller of the Currency in accordance with the provisions of the statutes of the
United States.
"Third. To pay the balance ratably among such stockholders,
in proportion to the number of shares held and ow^ned by each.
Such distribution shall be made from time to time as the proceeds
shall be received and as shall be deemed advisable by the Comptroller of the Currency, or the Federal Deposit Insurance Corporation if continued as receiver of the bank under subsection (a)
of this section, or such agent, as the case may be."
SEC. 19, The fourth sentence of section 2 of the Federal Deposit
Insurance Act (12 U.S.C. 1812) is amended to read as follows: "In
the event of a vacancy in the office of the Comptroller of the Currency,
and pending the appointment of his successor, or during the absence
or disability of the Comptroller, the Acting Comptroller of the Currency shall be a member of the Board of Directors in the place and
stead of the Comptroller."
SEC. 20. The text of the Act of November 7, 1918, as amended (12
U.S.C. 33, 34, 34a, 34b, and 34c), is amended to read as follows:
"That (a) any national banking association or any bank incorporated under the laws of any State may, with the approval of the
(''omptroller, be consolidated with one or more national banking associations located in the same State under the charter of a national
banking association on such terms and conditions as may be lawfully
agreed upon by a majority of the board of directors of each association or bank proposing to consolidate, and be ratified and confirmed

73

STAT.]

PUBLIC LAW 86-230-SEPT. 8, 1959

by the affirmative vote of the shareholders of each such association or
bank owning at least two-thirds of its capital stock outstanding, or
by a greater proportion of such capital stock in the case of such State
bank if the laws of the State where it is organized so require, at a
meeting to be held on the call of the directors after publishing notice
of the time, place, and object of the meeting for four consecutive weeks
in a newspaper of general circulation published in the place where the
association or bank is located, or, if there is no such newspaper, then
in the paper of general circulation published nearest thereto, and
after sending such notice to each shareholder of record by certified or
registered mail at least ten days prior to the meeting, except to those
shareholders who specifically waive notice, but any additional notice
shall be given to the shareholders of such State bank which may be
required Dy the laws of the State where it is organized. Publication
of notice may be waived, in cases where the Comptroller determines
that an emergency exists justifying such waiver,,by unanimous action
of the shareholders of the association or State bank.
" (b) The consolidated association shall be liable for all liabilities of
the respective consolidating banks or associations. The capital stock
of such consolidated association shall not be less than that required under existing law^ for the organization of a national bank in the place
in which it is located: Provided, That if such consolidation shall be
voted for at such meetings by the necessary majorities of the shareholders of each association and State bank proposing to consolidate,
and thereafter the consolidation shall be approved by the Comptroller,
any shareholder of any of the associations or State banks so consolidated who has voted against such consolidation at the meeting of the
association or bank of which he is a stockholder, or who has given
notice in writing at or prior to such meeting to the presiding officer
that he dissents from the plan of consolidation, shall be entitled to
receive the value of the shares so held by him when such consolidation
is approved by the Comptroller upon written request made to the consolidated association at any time before thirty days after the date of
consummation of the consolidation, accompanied by the surrender of
his stock certificates.
" (c) The value of the shares of any dissenting shareholder shall be
ascertained, as of the effective date of the consolidation, by an appraisal made by a committee of three persons, composed of (1) one
selected by the vote of the holders of the majority of the stock, the
owners of which are entitled to payment in cash; (2) one selected by
the directors of the consolidated banking association; and (3) one
selected by the two so selected. The valuation agreed upon by any
two of the three appraisers shall govern. If the value so fixed shall
not be satisfactory to any dissenting shareholder who has requested
payment, that shareholder may, within five days after being notified of
the appraised value of his shares, appeal to the Comptroller, who shall
cause a reappraisal to be made which shall be final and binding as to
the value of the shares of the appellant.
" ( d ) If, within ninety days from the date of consummation of the
consolidation, for any reason one or more of the appraisers is not
selected as herein provided, or the appraisers fail to determine the
value of such shares, the Comptroller shall upon written request of
any interested party cause an appraisal to be made which shall be
final and binding on all parties. The expenses of the Comptroller in
making the reappraisal or the appraisal, as the case may be, shall be
paid by the consolidated banking association. The value of the shares
ascertained shall be promptly paid to the dissenting shareholders by
the consolidated banking association. Within thirty days after payment has been made to all dissenting shareholders as provided for in

461

E v a l u a t i o n of
shares.

462

PUBLIC LAW 86-230-SEPT. 8, 1969

[73 STAT.

this section the shares of stock of the consolidated banking association
which would have been delivered to such dissenting shareholders had
they not requested payment shall be sold by the consolidated banking
association at an advertised public auction, unless some other method
of sale is approved by the Comptroller, and the consolidated banking
association shall have the right to purchase any of such shares at such
public auction, if it is the highest bidder therefor, for the purpose of
reselling such shares within thirty days thereafter to such person or
persons and at such price not less than par as its board of directors by
resolution may determine. If the shares are sold at public auction
at a price greater than the amount paid to the dissenting shareholders
the excess in such sale price shall be paid to such shareholders. The
appraisal of such shares of stock in any State bank shall be determined
in the manner prescribed by the law of the State in such cases, rather
than as provided in this section, if such provision is made in the State
law; and no such consolidation shall be in contravention of the law
of the State under which such bank is incorporated.
"(e) The corporate existence of each of the consolidating banks
or banking associations participating in such consolidation shall be
merged into and continued in the consolidated national banking association and such consolidated national banking association shall be
deemed to be the same corporation as each bank or banking association
participating in the consolidation. All rights, franchises, and interests
of the individual consolidating banks or banking associations in and
to every type of property (real, personal, and mixed) and choses in
action shall be transferred to and vested in the consolidated national
banking association by virtue of such consolidation without any deed
or other transfer. The consolidated national banking association,
upon the consolidation and without any order or other action on the
part of any court or otherwise, shall hold and enjoy all rights of property, franchises, and interests, including appointments, designations,
and nominations, and all other rights and interests as trustee, executor,
administrator, registrar of stocks and bonds, guardian of estates,
assignee, receiver, and committee of estates of lunatics, and in every
other fiduciary capacity, in the same manner and to the same extent as
such rights, franchises, and interests were held or enjoyed by any one
of the consolidating banks or banking associations at the time of consolidation, subject to the conditions hereinafter provided,
ity^^fwiidiction^''"
"(^) Where any consolidating bank or banking association, at the
time of the consolidation, was acting under appointment of any court as
trustee, executor, administrator, registrar of stocks and bonds, guardian
of estates, assignee, receiver, or committee of estates of lunatics, or
in any other fiduciary capacity, the consolidated national banking
association shall be subject to removal by a court of competent jurisdiction in the same manner and to the same extent as was such consolidating bank or banking association prior to the consolidation.
Nothing contained in this section shall be considered to impair in any
manner the right of any court to remove the consolidated national
banking association and to appoint in lieu thereof a substitute trustee,
executor, or other fiduciary, except that such right shall not be exercised in such a manner as to discriminate against national banking
associations, nor shall any consolidated national banking association
be removed solely because of the fact that it is a national banking
association.
" ( g ) Stock of the consolidated national banking association may be
issued as provided by the terms of the consolidation agreement, free
from any preemptive rights of the shareholders of the respective
consolidating banKS.

73

STAT.]

PUBLIC LAW 86-230-SEPT. 8, 1959

463

"SEC. 2. (a) One or more national banking associations or one or ^iitV.^^' agreemore State banks, with the approval of the Comptroller, under an
agreement not inconsistent with this Act, may merge into a national
banking association located within the same State, under the charter
of the receiving association. The merger agreement shall—
" (1) be agreed upon in writing by a majority of the board of
directors of each association or State bank participating in the
plan of merger;
"(2) be ratified and confirmed by the affirmative vote of the
shareholders of each such association or State bank owning at
least two-thirds of its capital stock outstanding, or by a greater
proportion of such capital stock in the case of a State bank if the
laws of the State where it is organized so require^ at a meeting to
be held on the call of the directors, after publishing notice of the
time, place, and object of the meeting for four consecutive Aveeks
in a newspaper of general circulation published in the place
where the association or State bank is located, or, if there is no
such newspaper, then in the newspaper of general circulation
published nearest thereto, and after sending such notice to each
shareholder of record by certified or registered mail at least ten
days prior to the meeting, except to those shareholders who specifically waive notice, but any additional notice shall he given to
the shareholders of such State bank which may be required by
the laws of the State where it is organized. Publication of
notice may be waived, in cases where the Comptroller determines
that an emergency exists justifying such waiver, by unanimous
action of the shareholders of the association or State bank;
"(3) specify the amount of the capital stock of the receiving
association, which shall not be less than that required under existing law for the organization of a national bank in the place in
which it is located and which will be outstanding upon completion of the merger, the amount of stock (if any) to be allocated,
and cash (if any) to be paid, to the shareholders of the association or State bank being merged into the receiving association;
and
"(4) provide that the receiving association shall be liable for
all liabilities of the association or State bank being merged into
the receiving association.
" ( b ) If a merger shall be voted for at the called meetings by the
necessary majorities of the shareholders of each association or State
bank participating in the plan of merger, and thereafter the merger
shall be approved by the Comptroller, any shareholder of any association or State bank to be merged into the receiving association who has
voted against such merger at the meeting of the association or bank
of which he is a stockholder, or has given notice in writing at or prior
to such meeting to the presiding officer that he dissents from the plan
of merger, shall be entitled to receive the value of the shares so held
by him when such merger shall be approved by the Comptroller upon
written request made to the receiving association at any time before
thirty days after the date of consummation of the merger, accompanied
by the surrender of his stock certificates.
"(c) The value of the shares of any dissenting shareholder shall be
ascertained, as of the effective date of the merger, by an appraisal
made by a committee of three persons, composed of (1) one selected by
the vote of the holders of the majority of the stock, the owners of
which are entitled to payment in cash; (2) one selected by the directors
of the receiving association; and (3) one selected by the two so selected.
The valuation agreed upon by any two of the three appraisers shall
govern. If the value so fixed shall not be satisfactory to any dissent-

464

PUBLIC LAW 86-230-SEPT. 8, 1959

[73 S T A T .

ing shareholder who has requested payment, that shareholder may,
within five days after being notified of the appraised value of his
shares, appeal to the Comptroller, who shall cause a reappraisal to be
made which shall be final and binding as to the value of the shares of
the appellant.
" ( d ) If, within ninety days from the date of consummation of the
merger, for any reason one or more of the appraisers is not selected
as herein provided, or the appraisers fail to determine the value of such
shares, the Comptroller shall upon written request of any interested
party cause an appraisal to be made which shall be final and binding
on all parties. The expenses of the Comptroller in making the reappraisal or the appraisal, as the case may be, shall be paid by the receiving association. The value of the shares ascertained shall be promptly
paid to the dissenting shareholders by the receiving association. The
shares of stock of the receiving association which would have been delivered to such dissenting shareholders had they not requested payment shall be sold by the receiving association at an advertised public
auction, and the receiving association shall have the right to purchase
any of such shares at such public auction, if it is the highest bidder
therefor, for the purpose of reselling such shares within thirty days
thereafter to such person or persons and at such price not less than par
as its board of directors by resolution may determine. If the shares
are sold at public auction at a price greater than the amount paid to
the dissenting shareholders, the excess in such sale price shall be paid
to such dissenting shareholders. The appraisal of such shares of stock
in any State bank shall be determined in the manner prescribed by
the law of the State in such cases, rather than as provided in this section, if such provision is made in the State law; and no such merger
shall be in contravention of the law of the State under which such
bank is incorporated. The provisions of this subsection shall apply
only to shareholders of (and stock owned by them in) a bank or association being merged into the receiving association.
"(e) The corporate existence of each of the merging banks or banking associations participating in such merger shall be merged into
and continued in the receiving association and such receiving association shall be deemed to be the same corporation as each bank or banking association participating in the merger. All rights, franchises,
and interests of the individual merging banks or banking associations
in and to every type of property (real, personal, and mixed) and
choses in action shall be transferred to and vested in the receiving
association by virtue of such merger without any deed or other transfer. The receiving association, upon the merger and without any order
or other action on the part of any court or otherwise, shall hold and
enjoy all rights of property, franchises, and interests, including appointments, designations, and nominations, and all other rights and
interests as trustee, executor, administrator, registrar of stocks and
bonds, guardian of estates, assignee, receiver, and committee of estates
of lunatics, and in every other fiduciary capacity, in the same manner
and to the same extent as such rights, franchises, and interests were
held or enjoyed by any one of the merging banks or banking associations at the time of the merger, subject to the conditions hereinafter
provided.
it^/fiiltd'ict'i^n^''"
"(^) Where any merging bank or banking association, at the time
of the merger, was acting under appointment of any court as trustee,
executor, administrator, registrar of stocks and bonds, guardian of
estates, assignee, receiver, or committee of estates of lunatics, or in any
other fiduciary capacity, the receiving association shall be subject to removal by a court of competent jurisdiction in the same manner and to
the same extent as was such merging bank or banking association prior

73 S T A T . ]

PUBLIC LAW 8 6 - 2 3 0 - S E P T . 8, 1959

to the merger, Nothing contained in this section shall be considered to
impair in any manner the right of any court to remove the receiving
association and to appoint in lieu thereof a substitute trustee, executor,
or other fiduciary, except that such right shall not be exercised in such
a manner as to discriminate against national banking associations,
nor shall any receiving association be removed solely because of the
fact that it is a national banking association.
"(g) Stock of the receiving association may be issued as provided
by the terms of the merger agreement, free from any preemptive rights
of the shareholders of the respective merging banks.
"SEC. 3. As used in this Act, the term—
"(1) 'State bank' means any bank, banking association, trust
company, savings bank (other than a mutual savings bank), or
other banking institution which is engaged in the business of receiving deposits and which is incorporated under the laws of any
State, or which is operating under the Code of Law for the District of Columbia (except a national banking association located
in the District of Columbia) ;
"(2) 'State' means the several States and Territories, the Commonwealth of Puerto Rico, the Virgin Islands, and the District of
Columbia;
" (3) 'Comptroller' means the Comptroller of the Currency; and
"(4) 'Receiving association' means the national banking association into which one or more national banking associations or
one or more State banks, located within the same State, merge."
SEC. 21. (a) Section 5199 of the Revised Statutes (12 U.S.C. 60) is
amended to read as follows:
"SEC. 5199. (a) The directors of any national banking association
may, quarterly, semiannually or annually, declare a dividend of so
much of the net profits of the association as they shall judge expedient,
except that until the surplus fund of such association shall equal its
common capital, no dividends shall be declared unless there has been
carried to the surplus fund not less than one-tenth part of the association's net profits of the preceding half year in the case of quarterly
or semiannual dividends, or not less than one-tenth part of its net
profits of the preceding two consecutive half-year periods in the case
of annual dividends: Promded^ That for the purposes of this section,
any amounts paid into a fund for the retirement of any preferred
stock of any such association out of its net profits for such period
or periods shall be deemed to be additions to its surplus fund if,
upon the retirement of such preferred stock, the amounts so paid into
such retirement fund may tlien properly be carried to surplus. In
any such case the association shall be obligated to transfer to surplus
the amounts so paid into such retirement fund on account of the
preferred stock as such stock is retired.
"(b) The approval of the Comptroller of the Currency shall be
required if the total of all dividends declared by such association in
any calendar year shall exceed the total of its net profits of that year
combined with its retained net profits of the preceding two years,
less any required transfers to surplus or a fund for the retirement of
any preferred stock.
"(c) For the purpose of this section the term 'net profits' shall
mean the remainder of all earnings from current operations plus actual
recoveries on loans and investments and other assets, after deducting
from the total thereof all current operating expenses, actual losses,
accrued dividends on preferred stock, if any, and all Federal and
State taxes."

465

Definitions.

49 Stat. 712.
D e c 1 a r ation of
dividends.

PUBLIC LAW 86-231-SEPT. 8, 1959

466
Reserve and capital requirements.
38 Stat. 259.

Ante, p. 465.
12 u s e 56.

Repeal.
19 Stat. 252.

49 Stat. 707.

Repeals.

42 Stat. 1461.

[73 8T A T ,

(b) The first sentence of the sixth paragraph of section 9 of the
Federal Reserve Act (12 U.S.C. 324) is amended to read as follows:
"All banks admitted to membership under authoritj^ of this section
shall be required to comply with the reserve and capital requirements
of this Act, to conform to those provisions of law imposed on national
banks which prohibit such banks from lending on or purchasing their
own stock and which relate to the withdrawal or impairment of their
capital stock, and to conform to the provisions of sections 5199(b) and
5204 of the Revised Statutes with respect to the payment of dividends;
except that any reference in any such provision to the Comptroller
of the Currency shall be deemed for the purposes of this sentence to
be a reference to the Board of Governors of the Federal Reserve
System."
SEC. 22. (a) Section 5212 of the Revised Statutes (12 U.S.C. 163)
is repealed.
(b) Section 5211 of the Revised Statutes (12 U.S.C. 161) is amended
by inserting after the second sentence the following new sentence:
"Every national bank shall make to the Comptroller reports of the
payment of dividends, including advance reports of dividends proposed to be declared or paid in such cases and under such conditions
as the Comptroller deems necessary to carry out the purposes of the
laws relating to national banks, in such form and at such times as
he may require."
SEC. 23. Section 21(a) (2) (A) of the Act of June 16, 1933 (ch. 89,
48 Stat. 189; 12 U.S.C. 378), is amended by inserting after "District,"
the following: "and subjected, by the laws of the United States, or of
the State, Territory, or District wherein located, to examination and
regulation,".
SEC. 24. Sections 201, 202, 203, 204, 205, 206, 207, 208, 209(a),
209(c), 209(d), 209(f), 209(g), 209(i), 210, 211, 212, 213, 214, 215,
and 217, and the last two sentences of section 209(b), of the Act of
March 4, 1923 (ch. 252, 42 Stat. 1467; 12 U.S.C. 1151-1322), are
repealed.
SEC. 25. Section 5134 of the Revised Statutes (12 U.S.C. 22) is
amended by striking out "which name shall be" and inserting in lieu
thereof "which name shall include the word 'national' and be".
Approved September 8, 1959.

Public Law 86-231
September 8, 1959

AN A C T

[s. 1448]

rji^ change the name of the Abraham Lincoln National Historical Park at
Hodgenville, Kentucky, to Abraham Lincoln Birthplace National Historic
Site.

Abraham Lincoln
National H i s t o rical Park, Hodgenv i l l e , Ky.
Name change.

Be it eihacted hy the Senate and House of Representatives of the
United States of America in Congress assenwled^ That the Abraham
Lincoln National Historical Park at Hodgenville, Kentucky, shall
hereafter be known as Abraham Lincoln Birthplace National Historic Site, and any law, regulation, document, or record of the United
States in which such historical park is designated or referred to under
the name of Abraham Lincoln National Historical Park shall be held
to refer to such historical park under and by the name of Abraham
Lincoln Birthplace National Historic Site.
Approved September 8, 1959.