Burlington weekly free press. [volume] (Burlington, Vt.) 1866-1928, 1913-10-23
NATIONAL SAVINGS BANKS
Text of New Section of Cur.
rency Measure.
Also Permits Opening of CONNER
cial Dcpartment-Proyi
to Insure Safe
Control.

The full text of the new section Of the !
currency bill granting authority to nation
al banks to open Savings" and com !
mercial" departments has been made pub |
lie for the first time, and reads as fol-
lows:
Section q. That any national banking
association may, subsequent to a date
one year after its becoming a stockhod-
err in a Federal Reserve bank. make APP
pllcaton to the comptroller Of the cur
rency for permission to open a savings
department. Such application shall set
forth that the directors of said national
bank have by a majority vote, apportion-
ed a specific percentage Of their paid-in
capital and surplus to said savings de-
partment, and to that end have segregat-
ed specified assets for the purposes of
said department. or that cash capital for
the said savings department has been OBJ
tanned by subscription to additional
tissues of the capita, stock Of said ma
tonal bank:
Provided, That the sum in assets or in
cash thus set apart for the uses OF the
proposed savings department aforesaid
| shall in no case be less than $4,000 or
than sum equal to 90 per centum of the
paid-up capital and surplus Of the said
national bank.
! In making the application aforesaid any
national banking association may further
apply for power to act as trustee for
mortgage loans, subject to the conditions
and llmlta lions herein prescribed or to
he established as hereinafter provided.
Whenever the comptroller OF the cur
rcncY shall have approved any such APP
plicaton rs hereinbefore provided he
shall so inform the applying bank and
| thereafter the organization and business
| conducted or possessed 10y said bank at
the time of making said application, cx-
cept such as has been specifically segre-
gated for the savings department, and
subsequent expansions thereof shall be
known as the commercial department Of
the said bank National banks may in
crease or diminish their capital stock in
the manner now provided by law. but
whenever such general increase or reduc-
ton of the capital stock of any natioSal
bank operating upon the provisions Of
this section shall be made. such increase
or reduction shall be appCrtioned be-
tween the commercial and savings de-
partments of the said bank as It's board
Of directors shall prescribe, notice Of
such increase or reduction, and of the
apportionment thereof. being forthwith
given to the comptroller of the currency;
and any such national bank may increase
or diminish the capital already appor-
toned to either it's savings or CONNER
cial department to an extent not in
consistent with the provisions of this
currency as hereinbefore provided. The
savings department for which authority
has been solicited and granted shall have
control of the cash or assets apportioned
to it as hereinbefore provided, and shall
be organized under rules and regulations
to be prescribed by the comptroller of the
| currency.
CONTROL OF NEW DEPARTMENTS.
Both the savings and commercial de-
partments created shall. however, be
under the control and direction of a
t single board of directors and of the gen.
eral officers of said bank.
All business transacted by the CONNER
cial department of any such national
bank shall be in every respect subject to
the limitations and requirements pro-
modified by this act, and such business
shall henceforward be known as com.
mercial business.
The savings department of each such
y national bank shall he authorized to &C.
cumulate and loan the funds of its de
positors, to receive deposits of curren
funds, both time and demand. to loar
any funds in its possession upon persona
or real estate security, and to colec
the same with interest. and to declar,
and pay dividends or interest both upor
demand and time deposits. The fedora
. reserve board is hereby authorized t
exempt the savings departments of ma
tional banking associations from any anC
q every restriction upon classes or kinds
of business laid down in the natona
v banking act, and it shall be the duty o
the said board, within one year after it!
organization, to prepare and publish rules
q and regulations for the conduct of bust
ness by such savings departments, con
e forming to the best standards prescribed
by the legislation of the several States
Provided, that such rules and regula
s tons shall not be inconsistent with tn
provisions of this section. All business
transacted by the savings departments o
y national banks shall be designated an,
known as savings bank business
Nothing in this section contained shall
be construed to authorize any such say
3 ings department to purchase, invest In
or hold bonds. securities, or evidence
of Indebtedness, public or private. excep
81 as follows:
(a) First, mortgages or deeds 6f trus
on real estate, including farm lands, ant
ID the notes or bonds for whose protection
such mortgages or deeds of trust ma
have been given:
- Provided, That such mortgages, deeds
n notes, or bonds shall have, when pur
chased. not more than five years to run
and provided, further, that the total deb
secured by such instruments shall no
III exceed 80 per centum OF the assessed Valu
of the real estate upon which they con
stitute a lien
% Bonds or interest bearing notes O
the United States or bonds or notes 10
, whose payment the faith of the Unite
- States is pledged both to principe
and interest.
(c) Bonds of any State of the Unite
States:
Provided That for ten years prior t
d the purchase of such bonds by a saving
bank department the State issuing tn
m same shall not have defaulted in the pay
ment of any part either of principal or c
interest thereon.
I'D Bonds of any city, county or towr