Pocahontas star herald., 1914-07-10
Bank Guaranty
ACT No. 2
BANK puPosI-oas GUARANTY LAW
PROPOSED ny INITIATIVE YETrrfos'
ACT NO. :.

A BW FOR an act 20 be entitled An Aet
Providing Tor the Security of brpnal-
tors IN the Incorporated Banks OF "
kansas CREATING the Bank Deposl.
tors Guaranty Fund Of the state OF
Arkansas. and Providing Regulations
Therefor, and Penalties for the Viola
tion thereof
FOR act No. :
AGAINST ACT No. :.
ne n Enacted by the People OF the
State OF Arkansas;
Section I. The stockholders of syery
bank. doing business In this STATE. shall
be- held individually responsible. equally
and ratahly and not one for another Tor
an contracts debts and engagements or
such bank. O. the extent Of three times
the amount OF their stock therein, az The
par value thereof iu addition % the
amount invested Ia such stock proNld-
ed. however. that stockholders OF such
banks or trust companies ns have ae-
cepted and are participating iu the hene-
fits OF the bank guaranty plan herein
after provided for, shall only be liable
to it's deposltors In addition 20 such
stock held by said stockholders one time
the nar value thereof and no more, pro-
vided. further. that persons holdrng
stock as executors, administrators, guar
dams or trustees shall not be personally
subject 10 liability as stockholders but
the estates and funds In their hands
shall be liable IN like manner and 20 the
same extent as the testator. intestate.
ward or person Interested In such trust
funds would be-. II living and competent
20 act and hold the estate In his own
name.
Sec. 2. Any Incorporated state bank
trust company or savings bank. doing
business in this State under the general
banking laws or Arkansas. and any bank
which NAV after the passage OF this act
be authorized to do business In this
state Is hereby authorized and empower
ed 10 participate In the assessments and
benefits and TO be governed by the regu-
lations Of the hank depositors' guaranty
funds OF the State OF Arkansas herein
after provided for Before any bank
shall become a guaranteed bank Within
the meaning Of this act resolution or
It's Board OF Directors. authorized hv
its stockholders duly certified by Its
president and secretary. asking there
for In form to be provided by the hank
commissioner. shall be filed with said
bank commissioner who shalt upon the
filing OF such resolution, make a rigid
examination of the affairs OF such bank
and n Il Is found 10 be solvent. 10 be
properly managed. and conducting its
business IN strict accordance with the
banking law. he shall after the bank
shall have deposited with the State
treasurer bonds or money a. hereinafter
provided. issue 20 such bank n certifi-
cate stating IN substance that said bank
has compiled with the provisions OF
this act. and that its deposltors are
guaranteed by the bank deposltors' guar
anty fund of the state OF Arkansas. as
herein provided.
Sec. 3 Before receiving such certi-
ficate from the bank commissioner each
bank entitled 20 the same according 70
Section OF this act shall as an evi-
dence OF good faith. deposit. aud shall
az all times maintain with the state
treasurer. tsuhiect TO the order OF the
bank commissioner when couuterEigned
by the auditor Of Statc) United states
bonds, Arkansas State bonds improve
ment district bonds. municipal bonds
school district bonds, within the State Of
Arkansas. 20 the amount OF five hundred
dollars for every one hundred thousand
dollars or fraction thereof Of It's average
deposits eligible TO guaranty Oess its
capital and surplusl as shown hy ita
last four published statements; provided.
that each bank shall 50 deposit not less
than five hundred dollars. and the State
treasurer shall issue his receipt there
20 'he auditor OF State. and one 70 tho
bank commissioner. Such bonds shall
bear the certificate Of the attorney
general OF the State OF Arkansas. stat
ing that In his opinion said bonds have
been legally ISSUED. said bonds or cash
in lieu thereof shall not be charged out
OF the assets OF the bank except as
hereinafter provided. but shall he car
"a heading
Guaranty Fund with State Treasurer
until such time as said bank shall de-
fault In payment OF assessments here
matter provided for. In lieu OF bonds.
the l.ank AT its option. may deposit
money. which deposit shall be exchange
able for acceptable bonds when the bank
elects TO make the substitution. In ad-
dition 10 above, each bank shall pay I'm
cash an amount equal TO one-fourth or
one per cent OF Its average deposits
.aHNg lac 4. "a.
surplus. and the same shall be credited
20 the bank depositors guaranty fund
with the State treasurer subject to the
order OF the bank commissioner and
the State treasurer shall issue his re-
ceipt therefor In trkplicate, one TO the
bank. one 20 the auditor OF State. and
one to the bank commissioner: provided
that any bank seeking 20 participate I'm
the assessment and benefits OF this act
after the first annual assessment for
shall be assessed an amount approNl-
mately equal 20 It's propoTtIonate share
OF the money then IN the bank deposit
tors guaranty fund after all losses shall
have been deducted, the amount Of such
assessment 10 be determined by tho
bank commissioner The last above
mentioned assessment. however. shall
not be required of new banks formed by
tho reorganization or solidation OF
banks which have previously complied
with the terms OF this act T'pon the
deposit and acceptance OF such bonds
tor money and the payment OF said as
seSsment, then the payment Of such de-
pogits ~ said bank as are specified IN
This act shall be guaranteed as nerpin
provided. and the bank entitled 70 its
certificate.
Sec & The bank commissioner shall
during the month OF January Of each
year. make assessments OF oncfourtn Of
one per cent Of the average guaranteed
deposits. less capital and surplus. of
each bank until the cash fund ac-
cumulatcd and placed to the credit OF
the bank depOsltOrs' guaranty fund shall
be approximately five hundred thousand
dollars over and above the cash de-
posted iu lien Of bonds. when hc shall
discontinue such assessments. Should
such fund become depleted, the bank
commissioner shall make such additional
ageessments from time 10 time as may
become necessary to maintain the same;
provided. that not more than six such as,
sessments OF one-fourth of one per cent
each shall be made IN any one calendar
wear. The treasurer Of the State Of Ar.
kansas shall hold this fund IN the state
depository banks as provided by las
governing other state funds, subject Ia