Transfer. Rights of existing creditors books of the association in such manner as may be prescribed in the by- not to be im paire 1. Individual lia of such association to the extent of the amount of their stock therein at the par value thereof, in addition to the amount invested in such shares; except that shareholders of any banking association now existing under state laws, having not less than five millions of dollars of capital actually paid in, and a surplus of twenty per centum on hand, both to be determined by the comptroller of the currency, shall be liable only to the amount invested in their shares; and such surplus of twenty per centum shall be kept undiminished, and be in addition to the surplus provided for in this act; and if at any time there shall be a deficiency in said surplus of twenty per centum, the said banking association shall not pay any dividends to its shareholders until such deficiency shall be made good; and in case of such deficiency, the comptroller of the currency may compel said banking association to close its business and wind up its affairs under the provisions of this act. And the comptroller shall have authority to withhold from an association his certificate authorizing the commencement of troller may withbusiness, whenever he shall have reason to suppose that the shareholders thereof have formed the same for any other than the legitimate objects contemplated by this act. When comphold certificate. Increase of cap ital stock. SEC. 13. And be it further enacted, That it shall be lawful for any association formed under this act, by its articles of association, to provide for an increase of its capital from time to time, as may be deemed expedient, subject to the limitations of this act: Provided, That the maximum of such Maximum. increase in the articles of association shall be determined by the comptroller of the currency; and no increase of capital shall be valid until the whole amount of such increase shall be paid in, and notice thereof shall have been transmitted to the comptroller of the currency, and his certificate obtained specifying the amount of such increase of capital stock, with his approval thereof, and that it has been duly paid in as part of the capital of such association. And every association shall have power, by the vote of shareholders owning two thirds of its capital stock, to reduce the capital of such association to any sum not below the amount required by this act, in the formation of associations: Provided, That by no such reduction shall its capital be brought below the amount required by this act for its outstanding circulation, nor shall any such reduction be made until the amount of the proposed reduction has been reported to the comptroller of the currency and his approval thereof obtained. Minimum. SEC. 14. And be it further enacted, That at least fifty per centum of Amount to be paid in before the capital stock of every association shall be paid in before it shall be commencing authorized to commence business; and the remainder of the capital stock business. of such association shall be paid in instalments of at least ten per centum Remainder, each on the whole amount of the capital as frequently as one instalment when to be paid. at the end of each succeeding month from the time it shall be authorized by the comptroller to commence business; and the payment of each instalment shall be certified to the comptroller, under oath, by the president or cashier of the association. SEC. 15. And be it further enacted, That if any shareholder, or his assignee, shall fail to pay any instalment on the stock when the same is required by the foregoing section to be paid, the directors of such association may sell the stock of such delinquent shareholder at public auction, Proceedings, if shareholder fails to pay instalments. quent share holders to be sold. Stock of delin- having given three weeks' previous notice thereof in a newspaper pub. lished and of general circulation in the city or county where the association is located, and if no newspaper is published in said city or county, then in a newspaper published nearest thereto, to any person who will pay the highest price therefor, and not less than the amount then due thereon, with the expenses of advertisement and sale; and the excess, if any, shall be paid to the delinquent shareholder. If no bidder can be found who will pay for such stock the amount due thereon to the association, and the cost of advertisement and sale, the amount previously paid shall be forfeited to the association, and such stock shall be sold as the directors may order, within six months from the time of such forfeiture, and if not sold it shall be cancelled and deducted from the capital stock of the association; and if such cancellation and reduction shall reduce the capital of the association below the minimum of capital required by this act, the capital stock shall, within thirty days from the date of such cancellation, be increased to the requirements of the act; in default of which a receiver may be appointed to close up the business of the association according to the provisions of the fiftieth section of this act. United States SEC. 16. And be it further enacted, That every association, after having registered bonds to be deposited complied with the provisions of this act, preliminary to the commencewith treasurer to ment of banking business under its provisions, and before it shall be an amount equal authorized to commence business, shall transfer and deliver to the treasto one third of the capital stock. urer of the United States any United States registered bonds bearing interest to an amount not less than thirty thousand dollars nor less than one third of the capital stock paid in, which bonds shall be deposited with the treasurer of the United States and by him safely kept in his office until the same shall be otherwise disposed of, in pursuance of the provisions of this act; and the Secretary of the Treasury is hereby authorized to receive and cancel any United States coupon bonds, and to issue in lieu thereof registered bonds of like amount, bearing a like rate of interest, and having the same time to run; and the deposit of bonds shall be, by every association, increased as its capital may be paid up or inDeposit to be creased, so that every association shall at all times have on deposit with increased; the treasurer registered United States bonds to the amount of at least one third of its capital stock actually paid in: Provided, That nothing in may be dimin- this section shall prevent an association that may desire to reduce its capital or to close up its business and dissolve its organization from taking up its bonds upon returning to the comptroller its circulating notes in the proportion hereinafter named in this act, nor from taking up any excess of bonds beyond one third of its capital stock and upon which no circulating notes have been delivered. ished. Comptroller to examine and de termine if association can com SEC. 17. And be it further enacted, That whenever a certificate shall have been transmitted to the comptroller of the currency, as provided in this act, and the association transmitting the same shall notify the compmence business. troller that at least fifty per centum of its capital stock has been paid in as aforesaid, and that such association has complied with all the provisions of this act as required to be complied with before such association shall be authorized to commence the business of banking, the comptroller shall examine into the condition of such association, ascertain especially the amount of money paid in on account of its capital, the name and place of residence of each of the directors of such association, and the amount of the capital stock of which each is the bona fide owner, and generally whether such association has complied with all the requirements of this act to entitle it to engage in the business of banking; and shall cause to be made and attested by the oaths of a majority of the directors and by the president or cashier of such association, a statement of all the facts necessary to enable the comptroller to determine whether such association is lawfully entitled to commence the business of banking under this act. SEC. 18. And be it further enacted, That if, upon a careful examination tion is found en of the facts so reported, and of any other facts which may come to the When associaknowledge of the comptroller, whether by means of a special commission titled to comappointed by him for the purpose of inquiring into the condition of such mence business, association, or otherwise, it shall appear that such association is lawfully comptroller to give certificate. entitled to commence the business of banking, the comptroller shall give to such association a certificate, under his hand and official seal, that such association has complied with all the provisions of this act required to be complied with before being entitled to commence the business of banking under it, and that such association is authorized to commence said business accordingly; and it shall be the duty of the association to cause said certificate to be published in some newspaper published in the city or county where the association is located for at least sixty days next after be published. the issuing thereof: Provided, That if no newspaper is published in such city or county the certificate shall be published in a newspaper published nearest thereto. Certificate to Transfers of How executed. SEC. 19. And be it further enacted, That all transfers of United States bonds which shall be made by any association under the provisions of bonds by associ ation, to be made this act shall be made to the treasurer of the United States in trust for to the treasurer the association, with a memorandum written or printed on each bond, and in trust. signed by the cashier or some other officer of the association making the deposit, a receipt therefor to be given to said association, or by the comptroller of the currency, or by a clerk appointed by him for that purpose, stating that it is held in trust for the association on whose behalf such transfer is made, and as security for the redemption and payment of any circulating notes that have been or may be delivered to such association. No assignment or transfer of any such bonds by the treasurer shall be deemed valid or of binding force and effect unless countersigned by the comptroller of the currency. It shall be the duty of the comptroller of the currency to keep in his office a book in which shall be entered the Comptroller to name of every association from whose accounts such transfer of bonds is keep transfer book, &. made by the treasurer, and the name of the party to whom such transfer is made; and the par value of the bonds so transferred shall be entered therein; and it shall be the duty of the comptroller, immediately upon countersigning and entering the same, to advise by mail the association from whose account such transfer was made of the kind and numerical designation of the bonds and the amount thereof so transferred. Transfers to be and entered. Books to be accessible. SEC. 20. And be it further enacted, That it shall be the duty of the comptroller of the currency to countersign and enter in the book, in the countersigned manner aforesaid, every transfer or assignment of any bonds held by the treasurer presented for his signature; and the comptroller shall have at all times during office hours access to the books of the treasurer, for the purpose of ascertaining the correctness of the transfer or assignment presented to him to countersign; and the treasurer shall have the like access to the book above mentioned, kept by the comptroller, during office hours, to ascertain the correctness of the entries in the same; and the comptroller shall also at all times have access to the bonds on deposit with the treasurer, to ascertain their amount and condition. Associations, may receive cir 1865, ch. 82. Post, p. 498., SEC. 21. And be it further enacted, That upon the transfer and delivery of bonds to the treasurer, as provided in the foregoing section, the after transfer, association making the same shall be entitled to receive from the comp- culating notes. troller of the currency circulating notes of different denominations, in blank, registered and countersigned as hereinafter provided, equal in amount to ninety per centum of the current market value of the United States bonds so transferred and delivered, but not exceeding ninety per centum of the amount of said bonds at the par value thereof, if bearing amount. interest at a rate not less than five per centum per annum; and at no time shall the total amount of such notes, issued to any such association, exceed the amount at such time actually paid in of its capital stock. SEC. 22. And be it further enacted, That the entire amount of notes Limit of Notes to express what. Entire circula- for circulation to be issued under this act shall not exceed three hundred tion not to exceed millions of dollars. In order to furnish suitable notes for circulation, the $300,000,000. comptroller of the currency is hereby authorized and required, under the Comptroller to direction of the Secretary of the Treasury, to cause plates and dies to be prepare the notes. engraved, in the best manner to guard against counterfeiting and fraudulent alterations, and to have printed therefrom, and numbered, such quanDenominations. tity of circulating notes, in blank, of the denominations of one dollar, two dollars, three dollars, five dollars, ten dollars, twenty dollars, fifty dollars, one hundred dollars, five hundred dollars, and one thousand dollars, as may be required to supply, under this act, the associations entitled to receive the same; which notes shall express upon their face that they are secured by United States bonds, deposited with the treasurer of the United States by the written or engraved signatures of the treasurer and register, and by the imprint of the seal of the treasury; and shall also express upon their face the promise of the association receiving the same to pay on demand, attested by the signatures of the president or vicepresident and cashier. And the said notes shall bear such devices and such other statements, and shall be in such form, as the Secretary of the Treasury shall, by regulation, direct: Provided, That not more than one sixth part of the notes furnished to an association shall be of a less denomination than five dollars, and that after specie payments shall be resumed no association shall be furnished with notes of a less denomination than five dollars. $5. Devices. Notes under When notes may be circu lated as money; SEC. 23. And be it further enacted, That after any such association shall have caused its promise to pay such notes on demand to be signed by the president or vice-president and cashier thereof, in such manner as to make them obligatory promissory notes, payable on demand, at its place of business, such association is hereby authorized to issue and circulate to be received the same as money; and the same shall be received at par in all parts of for all dues, exthe United States in payment of taxes, excises, public lands, and all other cept, &c. dues to the United States, except for duties on imports; and also for all salaries and other debts and demands owing by the United States to individuals, corporations, and associations within the United States, except interest on the public debt, and in redemption of the national currency. And no Post notes, &c., such association shall issue post notes or any other notes to circulate as money than such as are authorized by the foregoing provisions of this not to be issued. Worn-out and act. SEC. 24. And be it further enacted, That it shall be the duty of the mutilated notes. comptroller of the currency to receive worn-out or mutilated circulating notes issued by any such banking association, and also, on due proof of the destruction of any such circulating notes, to deliver in place thereof to such association other blank circulating notes to an equal amount. And such worn-out or mutilated notes, after a memorandum shall have been entered in the proper books, in accordance with such regulations as may be established by the comptroller, as well as all circulating notes which shall have been paid or surrendered to be cancelled, shall be burned to ashes in presence of four persons, one to be appointed by the Secretary of the Treasury, one by the comptroller of the currency, one by the treasurer of the United States, and one by the association, under such regulations as the Secretary of the Treasury may prescribe. And a certificate of such burning, signed by the parties so appointed, shall be made in the books of the comptroller, and a duplicate thereof forwarded to the association whose notes are thus cancelled. Associations to examine annual ly its bonds deposited, and make certificate. SEC. 25. And be it further enacted, That it shall be the duty of every banking association having bonds deposited in the office of the treasurer of the United States, once or oftener in each fiscal year, and at such time or times during the ordinary business hours as said officer or officers may select, to examine and compare the bonds so pledged with the books of the comptroller and the accounts of the association, and, if found correct, associations. to execute to the said treasurer a certificate setting forth the different Examination of kinds and the amounts thereof, and that the same are in the possession and custody of the treasurer at the date of such certificate. Such examination may be made by an officer or agent of such association, duly appointed in writing for that purpose, whose certificate before mentioned shall be of like force and validity as if executed by such president or cashier; and a duplicate signed by the treasurer shall be retained by the association. bonds to be held Provision as to SEC. 26. And be it further enacted, That the bonds transferred to and Deposited deposited with the treasurer of the United States, as hereinbefore pro- exclusively to vided, by any banking association for the security of its circulating notes, secure circulashall be held exclusively for that purpose, until such notes shall be tion. redeemed, except as provided in this act; but the comptroller of the currency shall give to any such banking association powers of attorney to interest. receive and appropriate to its own use the interest on the bonds which it shall have so transferred to the treasurer; but such powers shall become inoperative whenever such banking association shall fail to redeem its circulating notes as aforesaid. Whenever the market or cash value of If bonds deany bonds deposited with the treasurer of the United States, as afore- preciate, security to be made good. said, shall be reduced below the amount of the circulation issued for the same, the comptroller of the currency is hereby authorized to demand and receive the amount of such depreciation in other United States bonds at cash value, or in money, from the association receiving said bills, to be deposited with the treasurer of the United States as long as such depreciation continues. And said comptroller, upon the terms prescribed by the Secretary of the Treasury, may permit an exchange to be made of any of the bonds deposited with the treasurer by an association for other exchanged, if, bonds of the United States authorized by this act to be received as secu&c.; rity for circulating notes, if he shall be of opinion that such an exchange can be made without prejudice to the United States, and he may direct the return of any of said bonds to the banking association which transferred may be returned upon canthe same, in sums of not less than one thousand dollars, upon the surren- cellation of cirder to him and the cancellation of a proportionate amount of such cir- culating notes. culating notes: Provided, That the remaining bonds which shall have Proviso. been transferred by the banking association offering to surrender circulating notes shall be equal to the amount required for the circulating notes not surrendered by such banking association, and that the amount of bonds in the hands of the treasurer shall not be diminished below the amount required to be kept on deposit with him by this act: And provided, That there shall have been no failure by such association to redeem its circulating notes, and no other violation by such association of the provisions of this act, and that the market or cash value of the remaining bonds shall not be below the amount required for the circulation issued for the same. Bonds may be SEC. 27. And be it further enacted, That it shall be unlawful for any The counterofficer acting under the provisions of this act to countersign or deliver to signing and deany association, or to any other company or person, any circulating notes livery of circulating notes, contemplated by this act, except as hereinbefore provided, and in accord- except as perance with the true intent and meaning of this act. And any officer who mitted by this shall violate the provisions of this section shall be deemed guilty of a high fl misdemeanor, and on conviction thereof shall be punished by fine not exceeding double the amount so countersigned and delivered, and imprisonment not less than one year and not exceeding fifteen years, at the discretion of the court in which he shall be tried. SEC. 28. And be it further enacted, That it shall be lawful for any such association to purchase, hold, and convey real estate lows: as fol First. Such as shall be necessary for its immediate accommodation in the transaction of its business. act, made unlaw Penalty. Associations may hold, &c., certain real estate. |