The Mitchell capital. (Mitchell, Dakota [S.D.]) 1879-1918, 1909-03-18
PROVISIONS OF
DAk0TA'S BANK
INSURANCE LAW
Voluntary, but Absolute 1nsur-
ance on Deposits at 4 Per
Cent and Under.

Marion, :. ID. March ie-- -Represen-
tative Van Rusclcn vino has Just re-
turned from Pierre. where he served
upon the banking committee of the
mouse Of representatives, and in that
capacity framed the bank deposit In
surance bill. which has become a law,
o: this state in practically the same
form, furnishes The Tribune with n
statement OF the provisions OF the low
as follows:
\ state association of incorporated
banks Is provided for under the su-
pervisicn OF the state. to be managed
by a board OF commissioners consist
ing Of the state auditor, treasurer and
public examiner; the organization Is
perfected rs soon as 100 or more state
banks. approved by the public exam,
1ner and whose aggregate capttaliZa-
tion is at least $10o0.o00 make appli-
cation to the board of commissioners.
accompanied by the membership fees
and one years premium. FOR member
ship.
The membership fee ranges from
$lo0 TO SiTo. according to the size
of the bank. the capitalization being
the basis; the annual premium is one
mill on the banks deposits; and the
board OF commissioners has authority
to reduce the annual one mill levy
whenever tie condition of the bank de-
posit insurance fund will permit a
TO levy special assessments of not eN-
ceeding four mills in any year to meet
deficiencies. The annual premium is
based ON the average daily deposits
for the last three months previous to
the payment of the premium.
What the Law Provides.
AS soon as Il bank has perfected
ITS membership. and paid its dues. all
Its depositors are fully insured against
loss to any of their deposits. except
such as draw more than per cent an
nual interest. AS evidence of ii banks
membership a certificate suitable for
framing is furnished by the public eX-
aminer, which must be conspicuouslY
posted in the bank. and in case a. bank
which has become a member of the
association desires to withdraw. it
must give its depositors at least 80
days prior notice and also post a
certificate to that effect in a con-
spicuous place In it's bank. Failure to
give such notice is made felony.
After the association has been per-
fected. any other state or national bank
In good standing may become Il mem
ifer upon the same terms as the orig
inal members. Trust companies are
admitted upon the same terms as
banks, if they transact deposit bust
ness.
In the event that u bank which IS n
member of the association becomes In
solvent, the public examiner certifies
the names of the depositors and the
amounts due each to the state auditor
who issues warrants upon the prope,
fund for the payment of the losses.
after all depositors have been paid
IN full out Of the fund.- the association
is subrogated TO the rights Of the
depositors in the assets of the failed
bank. to the extent of the losses paid
out OF the bank deposit insurance fund
The law goes into effect on July
next and II is understood that quite
Il number of banks have already de-
clared themselves in readiness 10 Join
at the earliest possible moment
AS the South Dakota plan of bank
insurance is entirely new and untried
and unlike any other plan in existence
is is quite probable that it may be
found TO be somewhat crude In some
respects. although the general plan APP
pears to be along sound business lines
and as secure as any plan could be
devised that is voluntary in it's nature
instead of the compulsory system i1
vogue in Oklahoma.