St. Paul daily globe. [volume] (Saint Paul, Minn.) 1884-1896, 1886-12-16

ton exceed the minimum amount re-
qured by law, the excess may be placed
with other interest bearing bonds, or the
circulation secured by the excess shall be
surrendered by the association. where
upon the excess shall be delivered
by the treasurer of the United
States to the secretary of
the treasury for redemption with instruc-
tons to deposit from the proceeds with the
treasurer lawful money to the amount of
the outstanding calculations secured by such
bonds and hold the residue on account of
the association holding the bonds. The
sixth section provides that boards of direct
ors shall be constituted of not less than five
directors, exclusive of the vice president
and of the cashier, if he be a member of the
board. The seventh section makes it I'M
lawful for bank to take within its own
name or that OF any corporation or person
for its benefit any mortgage or real estate
as security for a contemporaneQus loan or
for advances. But no association is pro-
hibited from discounting any bill of eX-
change or prOmissory note not having more
than four months to run. although the
same may be secured by real estate. when
disc ounted for an endorser in the ordinary
course of business and when the mort
gagOrS lien is merely collateral. The
eighth section provides that section 500 of
revised statutes shall not apply to loans
made upon collateral security at least equal
in value to the amount payable. but it is
stipulated that
THE TOTAL LIABILITY
of any person or firm to banking associa-
ton. including loan or collateral, shall not
at any time exceed 10 per cent. upon the
aggregate of its paid in capital stock and
surplus fund, minus the 20 per cent. capt.
tai required by law to be retained. The
ninth section provides that associations
making loans contrary to law shall be sub
jected TO penalty which is not specified in
the draft. The tenth section provides that
all penalties provided for by the act shall
be assessed against the offending aSSocia-
ton by the COMPTROLLER, subject to an ap-
peal to the secretary of the treasury, and
in default of payment shall be withheld by
the treasurer from the interest OF the bonds
deposited, and if that be not sufficient the
balance shall be recovered through suit.
The eleventh. twelfth. thirteenth and four
teenth sections relate to surplus funds.
They provide that when the surplus fund
of any bank shall exceed by 20 per cent.
the amount of its capital stobk, the share
holders may be relieved of the individual
responsibility incurred by section 3, lis,
revised statutes. and every association may
be relieved of such liability in the proper
ton which the surplus bears to the whole
amount of capital stock. No exemption,
however, can be obtained through any
process by which any portion of the capital
stock may be converted into surplus. In
case the surplus is
REDUCED BY LOSS
or otherwise below the amount required for
exemption, the association is required after
notice to pay the deficiency by assessment
upon the shareholders: and if the dehcieney
be not made good, the bank is to be placed
in the hands of a receiver The fifteenth
section provides that banks designated by
the secretary of the treasury as repositories
of public money, which have deposited
bonds for its safe keeping, shall not be re-
Quired to keep on hand any reserve above
the amount of such deposits. The sixteenth
and last section empowers the deputy comp
troller to perform such duties as may be
assigned to him by the comptroller. A
supplement to the bill relating to failed
banks provides that after the assets of any
insolvent association for which a receiver
has been appointed, shall be sufficient to
pay all the creditors in full. the association
shall not be deemed to be dissolved, but
after the deliveries of the assets to the
agent of the shareholders, the association
shall be entitled to resume business if share
holders owning two-thirds of the capital
stock shall desire to do so. The comp
trOller suggested the ACCESSIBILITY of taking
some action for the relief of the depOSitOrS
of the defunct Freedman'S bank, and it
was arranged that he should appear before
the committee again on Saturday, to eX
plain his views on that subject.