Nashville union and American. [volume] (Nashville, Tenn.) 1853-1862, 1860-01-25
rHE ssBANK CoDE.,,
A Bin 20 Reform and Regulate the Busi.
ne.a 81 unnI-l--n IN -r.-.ro..en

tie Stale Of Tennessee, That every Bank which now
is or may hereafter be incorporated under the an
taoriy Of this State, shall be subject to the abili
ties, and governed by the rules and provisions con-
tanned in this act
Section ?. Be Il further enacted, That no Bank in
this State shall issue any note, not payable its
face al the counter where issued; nor shall any
Bank pay out any note not payable at its counter;
and Bank in this State shall issue any note of
less denomination than five dollars.
Section 3. Be further eQQcled, That the capital
stock Of each Bank in This State shall be paid in
CON- and that no substitute or equivalent shall be
received in lieu thereof; and part Of the capital
stock Of any Bank shall be sold transferred until
the whole amount thereof shall have been paid in;
nor shall any loan be made TO any stakeholder
until he shall have paid the full amount Of his
shares of stock; nor shall any loan then be made,
if in the opinion Of the Directors the object Of the
loan is to replace money borrowed to pay up his
stock.
section T. b. i further enacted That the capital
stock OF no Bank in this State, shall exceed three
millions Of dollars; nor shall any Bank commence
the business Of banking with less paid in capital
/ stock than three hundred thousand dollars. And
it shall be the duty Of the Supervisor to examine
and report the Governor. that this sum is actually
paid I'm. before any Bank shall commence business
| Provided That existing banks which may have more
than three millions Of capital stock or less paid IN
capital stock than three hundred thousand dollars,
shall not be restricted to three millions capital stock
OF compelled to increase their paid capital stock TO
/ three hundred Thousand dollars
Section 3. Be further enacted, Thatit shall not be
lawful for any Bank in this Stale, directly ind
recty TO increase its total liabilities beyond the
amount Of its total solvent assets, or use or employ
any Of its moneys goods chattes effects in trade
! or commerce; and no Bank shall hold or own more
real estate than is necessary carry its banking
business: PROVIDED. however II may receive mort
cages and assignments for debts previously coract
ed, and purchase in real estate thus mortgaged or
assigned; and purchase in lands sold at execution
sale under judgments in its favor, redeem lands
subject to redemption in order to secure its bad and
doubtful debts; but it shall not hold the same for
longer period than five years.
Section g. Be Z further enacted, ThatnO Bank in this
State shall permit its issues in actual circulation to
exceed the proportion Of two for one Of its specie
funds. consisting of coin. notes OF specie paying
Banks, and sight exchange. Nor shall any Bank Is
sue two for one Of specie funds, II the same exceed
in the aggregate two for Of actually paid CAPT
tai stock Each and every bank shall own and have
in its own vaults for the protection Of the notehold-
ers an amount Of coin equal 70 onefOurth OF It's en-
tire circulation and shall own and keep on hand an
amount of specie funds equal to onehird Of It's en-
tire liabilities. And in the event any bank shall
permit its CON- coin and specie funds, to fall be
low the proportions aforesaid, for the space OF for
tv DAYS together, then all discounts by sad bank
shall cease until said proportions are restored And
If any bank shall suffer Its com, or com and specie
funds to run below said proportions, over seventy
five days in ALL in any year. 1t shall be the duty
of the Supervisor forthwith TO cause proceedings
TO be instituted in the Chancery Court of the Dis
trict where such bank is located in the name Of
the State against such bank to have its assets sub
iec.ed to the payment Of its debts, and its charter
declared forfeited.
Section Z Be It further enacted, That no bank shall
employ in its business dividends due to its stock
holders, unless the same are made part Of the per-
manent paid capital stock Of the bank, by the stock
holders to whom the same are due and owing.
Section s. Be h further enacted, That with a view
10 make the capital stock Of Banks permanent and
to guard against the destruction Of the same that
the Board of Directors of each Bank, at the end Of
every six months, shall make thorough examIna-
ton of the condition of their respective Banks, and
ascertain as nearly possible the total amount OF
bad and doubtful debts due to the same, which shall
be reDOrted to the Board and spread upon the min
utes thereof and if It appear from this report and
examination that no profits have been made atthese
periods or any one of them, beyond the bad and
doubtful debt then no dividend shall be made until
a similar examination shall show that the profits do
exceed the bad and doubtful debt, and then divi-
dends may be declared out Of this excess OF profits
Section 8. Bet further enacted, That no Bank shall
be chartered for greater period than fifteen
years.
Section 10. Be Il further enacted That each Bank
shall make monthly statements, under the oath OF
its President and Cashier to the Comptroller OF the
State, of It's true condition. This statement shal-
show, under separate heads, the amount OF CON-
the sums due from Banks in this State, the amount
due from Banks out of the State, and the entire
amount of its bills notes and other assets 1t shall
also show the entire extent Of Its liabilities, incud-
ing its amount of circulation, &c; which report
when made and verified, shall be published accord
ing to law
Section H. Be 70 further enacted, That no Bank
shall deal in uncurrent money or pay out the notes
Of other Banks and when in state Of suspension
shall not take receive more than one per cent Tor
exchange; and shall pay into the Treasury OF the
State onehaf per cent on its capital stock for eve
ny month or fraction Of a month, whilst thus re-
naming in suspension.
Section T. Be Il further enacted That no Bank
shall procure another to give credit 10 Its en-
culation, through any security or indemnity given
for doing.
Section IL Be further eaacied, That each Bank
shall keep book for the registry Of the number,
denomination. and amount Of the notes intended
for circulation. and that before the same are placed
in circulation. the Supervisor Of Banks shali eN-
anime the notes. compare them with the registry,
that they correctly registered, and eertliy
the fact upon the book and that he shall procure
exact copy of the same and report to the comp
troller who shall publish it according to law and
this shall be done as often as the Bank may desire
To increase its circulation II the officers OF any
Bank shall wilfully put in circulation any note or
notes not registered as herein provided such officers
shall be guilty of misdcmeanOr, and on conviction
shall be severally fined less than five hundred
dollars and imprisoned not less than SIX nor more
than twelve months.
Section H. Be It further enacted, That no part
of the capital stock Of any Bank shall be with |
any portion of its assets applied to any other pur-
pose than that of legitimate banking, as defined |
and prescribed by the provisions Of tins acts ana
any Board such members Of the Board as shaA !
permit the to be done, shall be guilty OF a |
mIsdemeanOr, and shall, on conviction thereof, De
fined in the Of five hundred dollars each ana 1
imprisoned for not less than two nor more than Ten
months.
Section Is. Be further enacted That no person !
shall be Director IN any Bank who is not cltlzen /
of this State; nor shall more than tW9tbrds OF any
Bank Directory be stockholders in the Bank for /
which they act Directors and no Director many /
other Bank. nor partner in trade Of such Director /
nor two persons trading in partnership az the same
time, shall be eligible or capable Of serving as Di-
rectOrs in such Bank.
Section l6 Be further enacted, That all accom- /
mOdatOns extended to the stockholders of the IN ]
sutut0n, shall be upon the same terms that are I
exacted from Its other customers; and a violation 1
of the provisons of this section, shall be mlsde-
meanor in the Directors voting for tie same, and
punishable by fine and imprisonment
Section IL. BE further enacted. That no Sank shall
pay intereston deposits nor buy la hold or cancel
It's own stock but may receive it IN payment OF bad
and doubtful debts for the purchase Of real es-
tate and in such case the stock shall be conveyed to
third party in trust TO be sold by him for tie benz
mt Of such Bank
Section Is Be Il further enacted, That person /
known as the Supervisor of Banks, shall be appoint
ed by the Governor and confirmed by the Senate /
who shall hold his office for two years and until his /
oAeONseNl Is lOlIlcu ana Qu&lllet d'l NDlll-
mlssloned, whose duty it shall be TO examine and /
report under oath least quarterly the condition
OF every Bank in the State; showing in his report
under separate heads the amount of CON- exchange /
bills, notes and other assets of said Banks well 4
az the amount of issues and entire liabilities Of the
same such statement shall also show the solvent 1
assets and bad and doubtful debts, and any other
items necessary 10 explain the condition of the same
and also the names and residences of each of the |
stockholders in the same, with the amount of stock
owned by each Of them in such bank; it shall /
also show whether the capital stock of said bank Is
paid in and any other fact and circumstance to give
the public a correct knowledge Of the Bank which /
report shall be published 10y the Comptroller ac- /
eoriing TO law. In case the Supervisor shall die /
Yesrn or remove, between the sessions Of the Gen
erai Assembly it shall be the duty OF the Governor
IN appoint for the unexpired term.
section 49, Be Z further enacted, That whenever
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