ments.

making such report. In addition to the quarterly reports required by Monthly state- this section, every association shall, on the first Tuesday of each month, make to the comptroller of the currency a statement, under the oath of the president or cashier, showing the condition of the association making such statement, on the morning of the day next preceding the date of such statement, in respect to the following items and particulars, to wit: average amount of loans and discounts, specie, and other lawful money belonging to the association, deposits, and circulation. And associations in other places than those cities named in the thirty-first section of this act shall also return the amount due them available for the redemption of their circulation.

Associations not to make

SEC. 35. That no association shall make any loan or discount on the loans, &c. on the security of the shares of its own capital stock, nor be the purchaser or security of their holder of any such shares, unless such security or purchase shall be necesown stock, &c. sary to prevent loss upon a debt previously contracted in good faith; and stock so purchased or acquired shall, within six months from the time of its purchase, be sold or disposed of at public or private sale, in default of which a receiver may be appointed to close up the business of the association, according to the provisions of this act.

Indebtedness not to exceed capital stock, except, &c.

Associations

not to hypothecate circulating notes, for, &c.;

not to with

draw any portion of their capital.

Losses.

Bad debts.

What to be deemed bad debts.

Associations not to pay out certain notes.

SEC. 36. That no association shall at any time be indebted, or in any way liable, to an amount exceeding the amount of its capital stock at such time actually paid in and remaining undiminished by losses or otherwise, except on the following accounts, that is to say:

First. On account of its notes of circulation.

Second. On account of moneys deposited with, or collected by, such association.

Third. On account of bills of exchange or drafts drawn against money actually on deposit to the credit of such association, or due thereto.

Fourth. On account of liabilities to its stockholders for dividends and reserved profits.

SEC. 37. That no association shall, either directly or indirectly, pledge or hypothecate any of its notes of circulation, for the purpose of procuring money to be paid in on its capital stock, or to be used in its banking operations, or otherwise; nor shall any association use its circulating notes, or any part thereof, in any manner or form, to create or increase its capital stock.

such

SEC. 38. That no association, or any member thereof, shall, during the time it shall continue its banking operations, withdraw, or permit to be withdrawn, either in form of dividends or otherwise, any portion of its capital. And if losses shall at any time have been sustained by any association equal to or exceeding its undivided profits then on hand, no dividend shall be made; and no dividend shall ever be made by any association, while it shall continue its banking operations, to an amount greater than its nett profits then on hand, deducting therefrom its losses and bad debts. And all debts due to any association, on which interest is past due and unpaid for a period of six months, unless the same shall be well secured, and shall be in process of collection, shall be considered bad debts within the meaning of this act: Provided, That nothing in this section shall prevent the reduction of the capital stock of the association under the thirteenth section of this act.

SEC. 39. That no association shall at any time pay out on loans or discounts, or in purchasing drafts or bills of exchange, or in payment of deposits, or in any other mode pay or put in circulation the notes of any bank or banking association which shall not, at any such time, be receivable, at par, on deposit and in payment of debts by the association so paying out or circulating such notes; nor shall it knowingly pay out or put in circulation any notes issued by any bank or banking association which at the time of such paying out or putting in circulation is not redeeming its circulating notes in lawful money of the United States.

List of names

and residences of

SEC. 40. That the president and cashier of every such association shall cause to be kept at all times a full and correct list of the names and res- shareholders to idences of all the shareholders in the association, and the number of be kept; shares held by each, in the office where its business is transacted; and such list shall be subject to the inspection of all the shareholders and to be subject creditors of the association, and the officers authorized to assess taxes unto inspection; der State authority, during business hours of each day in which business may be legally transacted; and a copy of such list, on the first Monday of to be sent to July in each year, verified by the oath of such president or cashier, shall comptroller. be transmitted to the comptroller of the currency.

How collected, not paid in

time.

Return of cir

be made.

SEC. 41. That the plates and special dies to be procured by the comp- Comptroller to keep control of troller of the currency for the printing of such circulating notes shall re- plates and spemain under his control and direction, and the expenses necessarily in- cial dies. curred in executing the provisions of this act respecting the procuring of Expenses to be borne by assuch notes, and all other expenses of the bureau, shall be paid out of the sociations." proceeds of the taxes or duties now or hereafter to be assessed on the circulation, and collected from associations organized under this act. And in lieu of all existing taxes, every association shall pay to the Treasurer of the United States, in the months of January and July, a duty of one half of one per centum each half year from and after the first day Duty upon of January, eighteen hundred and sixty-four, upon the average amount circulation, deof its notes in circulation, and a duty of one quarter of one per centum tal stock to be posits, and capieach half year upon the average amount of its deposits, and a duty of paid semi-annuone quarter of one per centum each half year, as aforesaid, on the aver- ally. age amount of its capital stock beyond the amount invested in United States bonds; and in case of default in the payment thereof by any association, the duties aforesaid may be collected in the manner provided for the collection of United States duties of other corporations, or the if treasurer may reserve the amount of said duties out of the interest, as it may become due, on the bonds deposited with him by such defaulting association. And it shall be the duty of each association, within ten days from the first days of January and July of each year, to make a return, under the oath of its president or cashier, to the Treasurer of the United culation, &c. to States, in such form as he may prescribe, of the average amount of its notes in circulation, and of the average amount of its deposits, and of the average amount of its capital stock, beyond the amount invested in United States bonds, for the six months next preceding said first days of January and July as aforesaid, and in default of such return, and for each default thereof, each defaulting association shall forfeit and pay to the default. United States the sum of two hundred dollars, to be collected either out of the interest as it may become due such association on the bonds deposited with the treasurer, or, at his option, in the manner in which penalties are to be collected of other corporations under the laws of the United States; and in case of such default the amount of the duties to be paid by such association shall be assessed upon the amount of notes delivered to such association by the comptroller of the currency, and upon the highest amount of its deposits and capital stock, to be ascertained in such other manner as the treasurer may deem best: Provided, That nothing in this act shall be construed to prevent all the shares in any of the said hereby exempted associations, held by any person or body corporate, from being included from taxation by State authority. in the valuation of the personal property of such person or corporation in the assessment of taxes imposed by or under state authority at the place where such bank is located, and not elsewhere, but not at a greater rate than is assessed upon other moneyed capital in the hands of individual citizens of such State: Provided, further, That the tax so imposed under the laws of any State upon the shares of any of the associations authorized by this act shall not exceed the rate imposed upon the shares in any of the banks organized under authority of the State where such association is located: Provided, also, That nothing in this act shall ex

Penalty for

Shares not

Limit of State tax.

be taxed.

Real estate to empt the real estate of associations from either State, county, or municipal taxes to the same extent, according to its value, as other real estate is taxed.

How associations may be closed.

Proceedings.

Treasurer to execute duplicate receipts.

Redeemed

notes to be mutilated, &c.

State banks

tional associa

tions.

cedure.

SEC. 42. That any association may go into liquidation and be closed by the vote of its shareholders owning two thirds of its stock. And whenever such vote shall be taken it shall be the duty of the board of directors to cause notice of this fact to be certified, under the seal of the association, by its president or cashier, to the comptroller of the currency, and publication thereof to be made for a period of two months in a newspaper published in the city of New York, and also in a newspaper published in a city or town in which the association is located, and if no newspaper be there published, then in the newspaper published nearest thereto, that said association is closing up its affairs, and notifying the holders of its notes and other creditors to present the notes and other claims against the association for payment. And at any time after the expiration of one year from the time of the publication of such notice as aforesaid, the said association may pay over to the Treasurer of the United States the amount of its outstanding notes in the lawful money of the United States, and take up the bonds which said association has on deposit with the treasurer for the security of its circulating notes; which bonds shall be assigned to the bank in the manner specified in the nineteenth section of this act, and from that time the outstanding notes of said association shall be redeemed at the treasury of the United States, and the said association and the shareholders thereof shall be discharged from all liabilities therefor.

SEC. 43. That the treasurer, on receiving from an association lawful money for the payment and redemption of its outstanding notes, as provided for in the preceding section of this act, shall execute duplicate receipts therefor, one to the association and the other to the comptroller of the currency, stating the amount received by him, and the purpose for which it has been received, which amount shall be paid into the treasury of the United States, and placed to the credit of such association upon redemption account. And it shall be the duty of the treasurer, whenever he shall redeem any of the notes of said association, to cause the same to be mutilated, and charged to the redemption account of said association ; and all notes so redeemed by the treasurer shall, every three months, be certified to and burned in the manner prescribed in the twenty-fourth section of this act.

SEC. 44. That any bank incorporated by special law, or any banking may become na- institution organized under a general law of any State, may, by authority of this act, become a national association under its provisions, by the name prescribed in its organization certificate; and in such case the articles of association and the organization certificate required by this act may be executed by a majority of the directors of the bank or banking institution; and said certificate shall declare that the owners of two thirds of the capital stock have authorized the directors to make such certificate and to change and convert the said bank or banking institution into a naMode of pro- tional association under this act. And a majority of the directors, after executing said articles of association and organization certificate, shall have power to execute all other papers, and to do whatever may be required to make its organization perfect and complete as a national association. The shares of any such bank may continue to be for the same amount each as they were before said conversion, and the directors aforesaid may be the directors of the association until others are elected or appointed in accordance with the provisions of this act; and any State bank which is a stockholder in any other bank, by authority of State laws, may continue to hold its stock, although either bank, or both, may be organized under and have accepted the provisions of this act. When the comptroller shall give to such association a certificate, under his hand and official

seal, that the provisions of this act have been complied with, and that it is authorized to commence the business of banking under it, the association shall have the same powers and privileges, and shall be subject to the same duties, responsibilities, and rules, in all respects as are prescribed in this act for other associations organized under it, and shall be held and regarded as an association under this act: Provided, however, That no such association shall have a less capital than the amount prescribed for banking associations under this act.

Associations,

may be finan

SEC. 45. That all associations under this act, when designated for that purpose by the Secretary of the Treasury, shall be depositaries of public when so desig nated, may be money, except receipts from customs, under such regulations as may be depositaries of prescribed by the Secretary; and they may also be employed as financial public moneys, agents of the government; and they shall perform all such reasonable except, &c.; duties, as depositaries of public moneys and financial agents of the govern- cial agents. ment, as may be required of them. And the Secretary of the Treasury shall require of the associations thus designated satisfactory security, by Designated dethe deposit of United States bonds and otherwise, for the safe-keeping and positaries to pay prompt payment of the public money deposited with them, and for the promptly; faithful performance of their duties as financial agents of the government: Provided, That every association which shall be selected and designated as receiver or depositary of the public money shall take and receive at par all of the national currency bills, by whatever association issued, which have been paid in to the government for internal revenue, or for loans or stocks.

to receive national currency bills at par.

fail to redeem

&c.

Notice of pro

forwarded to

SEC. 46. That if any such association shall at any time fail to redeem, If associations in the lawful money of the United States, any of its circulating notes, their circulation, when payment thereof shall be lawfully demanded, during the usual hours the notes may be of business, at the office of such association, or at its place of redemption protested, unless, aforesaid, the holder may cause the same to be protested, in one package, by a notary-public, unless the president or cashier of the association whose notes are presented for payment, or the president or cashier of the association at the place at which they are redeemable, shall offer to waive demand and notice of the protest, and shall, in pursuance of such offer, make, sign, and deliver to the party making such demand an admission in writ- test, &c. to be ing, stating the time of the demand, the amount demanded, and the fact of comptroller. the non-payment thereof; and such notary-public, on making such protest, or upon receiving such admission, shall forthwith forward such admission or notice of protest to the comptroller of the currency, retaining a copy thereof. And after such default, on examination of the facts by the comp- Association not troller, and notice by him to the association, it shall not be lawful for the to do business further, except, association suffering the same to pay out any of its notes, discount any notes &c. or bills, or otherwise prosecute the business of banking, except to receive and safely keep money belonging to it, and to deliver special deposits: Provided, That if satisfactory proof be produced to such notary-public Notes not to be that the payment of any such notes is restrained by order of any court of protested in cercompetent jurisdiction, such notary-public shall not protest the same; and when the holder of such notes shall cause more than one note or package to be protested on the same day, he shall not receive pay for more than one protest.

tain cases.

Fees of notary.

of failure to re

agent to ascer

SEC. 47. That on receiving notice that any such association has failed Upon notice to redeem any of its circulating notes, as specified in the next preceding deem circulasection, the comptroller of the currency, with the concurrence of the Sec- tion, comptroller retary of the Treasury, may appoint a special agent (of whose appointment to send special immediate notice shall be given to such association) who shall immediately tain facts; proceed to ascertain whether such association has refused to pay its circulating notes in the lawful money of the United States, when demanded as aforesaid, and report to the comptroller the fact so ascertained; and if, from such protest or the report so made, the comptroller shall be satisfied that such association has refused to pay its circulating notes as aforesaid

when to de

clare securities

forfeited;

ers of notes to

present them for payment;

to pay notes and cancel bonds.

and is in default, he shall, within thirty days after he shall have received notice of such failure, declare the United States bonds and securities pledged by such association forfeited to the United States, and the same to notify hold- shall thereupon be forfeited accordingly. And thereupon the comptroller shall immediately give notice in such manner as the Secretary of the Treasury shall, by general rules or otherwise, direct, to the holders of the circulating notes of such association to present them for payment at the treasury of the United States, and the same shall be paid as presented in lawful money of the United States; whereupon said comptroller may, in his discretion, cancel an amount of bonds pledged by such association equal at current market rates, not exceeding par, to the notes paid. And it shall be lawful for the Secretary of the Treasury, from time to time, to make such regulations respecting the disposition to be made of such circulating notes after presentation thereof for payment as aforesaid, and respecting the perpetuation of the evidence of the payment thereof as may seem to him proper; but all such notes, on being paid, shall be cancelled. And for any deficiency in the proceeds of the bonds pledged by such association, when disposed of as hereinafter specified, to reimburse to the United States the amount so expended in paying the circulating notes of such association, the United States shall have a first and paramount lien upon all the assets of such association; and such deficiency shall be made good out of such assets in preference to any and all other claims whatsoever, except the necessary costs and expenses of administering the same.

The United States to have priority of lien upon assets for

any deficiency in redemption of circulation.

Bonds pledged as security may

be sold at auction;

or at private sale.

Proviso.

Comptroller may appoint a receiver to close

affairs of defaulting association.

Bond and duties of receiver, &c.

SEC. 48. That whenever the comptroller shall become satisfied, as in the last preceding section specified, that any association has refused to pay its circulating notes as therein mentioned, he may, instead of cancelling the United States bonds pledged by such association, as provided in the next preceding section, cause so much of them as may be necessary to redeem the outstanding circulating notes of such association to be sold at public auction in the city of New York, after giving thirty days' notice of such sale to such association.

SEC. 49. That the comptroller of the currency may, if he shall be of opinion that the interests of the United States will be best promoted thereby, sell at private sale any of the bonds pledged by such association, and receive therefor either money or the circulating notes of such failing association: Provided, That no such bonds shall be sold by private sale for less than par, nor less than the market value thereof at the time of sale: And provided, further, That no sales of any such bonds, either public or private, shall be complete until the transfer thereof shall have been made with the formalities prescribed in this act.

SEC. 50. That on becoming satisfied, as specified in this act, that any association has refused to pay its circulating notes as therein mentioned, and is in default, the comptroller of the currency may forthwith appoint a receiver, and require of him such bond and security as he shall deem proper, who, under the direction of the comptroller, shall take possession of the books, records, and assets of every description of such association, collect all debts, dues, and claims belonging to such association, and, upon the order of a court of record of competent jurisdiction, may sell or compound all bad or doubtful debts, and, on a like order, sell all the real and personal property of such association, on such terms as the court shall direct; and may, if necessary to pay the debts of such association, enforce the individual liability of the stockholders provided for by the twelfth section of this act; and such receiver shall pay over all money so made to the treasurer of the United States, subject to the order of the comptroller of the currency, and also make report to the comptroller of the currency of all his acts and proceedings. The comptroller shall thereupon cause notice to be given, by advertisement in such newspapers as he may direct, for three consecutive months, calling on all persons who may have