Title 51A — BANKS AND BANKING

Under no circumstances may a bank obligate more than twenty percent of its capital stock and surplus and undivided profits for that purpose. Any agricultural credit corporation or livestock loan company, or its affiliate, has the same privileges as a state chartered bank or trust…

Source: SL 1977, ch 398 ; SL 1981, ch 346 , § 36; SL 1982, ch 335 ; SL 1983, ch 358 ; SL 1988, ch 377 , § 98; SDCL, § 51-18-23.1.

In addition to powers otherwise conferred by the laws of this state, a bank may exercise all such powers as are usual in carrying on the business of banking, including, the buying, discounting, and negotiating promissory notes, bonds, drafts, bills of exchange, foreign and domest…

A bank may, directly or through subsidiaries, carry on the business of banking, pursuant to § 51A-4-1 , with any person licensed in this state to engage in the business of industrial hemp or marijuana, or with any person engaging in legal business dealings with such licensee. Sou…

A bank may, by itself or through a subsidiary, acquire, hold and convey property of any kind to satisfy debts previously contracted in good faith and in the ordinary course of business at a purchase price which is no greater than the aggregate of the debt, interest and other cost…

51A-4-12 Checks settled at par--Payment from reserve deposits. 51A-4-13 Borrowing money by bank--Pledge of assets. 51A-4-14 "Bills payable" issued for money borrowed by bank--Record of amount borrowed. 51A-4-15 Rediscounting of negotiable paper--Limitation on pledge of assets as …

Except as to any check sent to it as a special collection item, no bank shall settle any check drawn on it otherwise than at par. Any check bearing an out - of - town endorsement shall be, at the option of the drawee bank, payable by draft drawn on the reserve deposits of the dra…

A bank may borrow money and pledge assets for terms, and upon conditions, established by the Banking Commission in rules promulgated pursuant to chapter 1-26 . Source: SDC 1939, § 6.0423; SDCL, § 51-6-14; SL 1969, ch 11 , § 4.9; SL 1981, ch 346 , § 31; SDCL, § 51A-4-13 ; SL 1999,…

A bank shall issue its "bills payable" for any money borrowed by it, and shall show on its books and in all reports and statements made by it, the true amount of money borrowed by it. Source: SL 1909, ch 222 , art 2, § 33; SL 1915, ch 102 , art 2, § 37; SL 1918 (SS), ch 29 ; RC 1…

A bank may rediscount in good faith and endorse any of its negotiable paper. However, no bank may pledge any of its assets as collateral security for the payment thereof, except as required by rules of the federal reserve bank. The director may require such bank to repay any such…

A bank may sell, transfer or assign participations in mortgage loans and other loans made by a bank to agencies of the state or federal government, to public instrumentalities, or to financial institutions of any type including, but not limited to, banks, savings and loan associa…

A bank may sell any asset in the ordinary course of business, or, with the approval of the director in any other circumstance, but the sale of all or substantially all of the assets of a bank or a department thereof is considered a voluntary liquidation and governed by chapters 5…

In the event of a legal holiday, power failure, fire, act of God, riot, strike, robbery or attempted robbery, epidemic, interruption of communication facilities, or for such other reason as the director may determine to be good cause, or in the event of the declaration of the exi…

If any bank adopts new hours of operation for its daily business to customers, it shall inform the division prior to the effective date of the change. Source: SL 1969, ch 11 , § 4.13; SL 1981, ch 346 , § 34; SL 1988, ch 377 , § 90; SDCL, § 51-18-14.

A bank may, directly or through subsidiaries, purchase or sell without recourse any security upon the order of a customer for his account. The terms of this section shall be construed to permit banks to contract with securities brokerage services. Source: SL 1969, ch 11 , § 4.7; …

No bank may employ its money, directly or indirectly, in the purchase of the stock of any other bank. However, a bank, or branch bank, may make reasonable contributions to local community agencies or groups to further the physical, economic, and social development of the bank's c…

For the purposes of §§ 51A-4-20 to 51A-4-20.3 , inclusive, the term "community development corporation" is limited to those community development corporations that are substantially invested in South Dakota communities. Source: SL 1992, ch 334 , § 1A.

To qualify as a permissible investment for banks pursuant to § 51A-4-20 , a community development corporation shall be of a predominantly civic, community, or public nature and not merely private and entrepreneurial. Any project or entity which has been approved as a community de…

The Banking Commission may, by rule promulgated pursuant to chapter 1-26 , establish additional requirements concerning a bank's investment in community development corporations and may establish criteria for permissible community development corporation investments. Source: SL 1…

A bank may make investments designed primarily to promote the public welfare, including the welfare of low and moderate income communities or families. A bank may make such investments directly or by purchasing interests in an entity primarily engaged in making such investments. …

Any debt due to any bank on which the interest is past due and unpaid for a period of six months unless the debt is well secured or in process of collection, shall be considered a bad debt and be charged to the reserve for loan and lease losses. In no case may an overdraft be hel…

A bank may purchase or acquire or agree to purchase or acquire, from any seller, any retail installment contract on such terms and conditions and for such price as may be agreed upon between them. Any such agreement does not give rise to any agency relationship between the bank a…

A bank may, on its own behalf or through a designated subsidiary, acquire and lease to others, personal property with the approval of the director or in accordance with rules adopted by the commission, upon the following terms and conditions: (1) The original lease shall be in wr…

A bank may engage in the business of purchasing open accounts. Where a bank purchases open accounts but the seller agrees to repurchase such accounts upon default, the seller's obligation to repurchase shall be taken into consideration in computing the bank's lending limit to the…

A bank may purchase for its own account investment securities and registered mutual funds that invest exclusively in securities of the United States or its agencies and annuities as defined in § 51A-4-25.1 under such limits and restrictions as the commission may prescribe by rule…

For the purposes of § 51A-4-25 , an annuity is an investment that credits interest from the inception of the contract, has an interest guarantee period that may be from thirty days to one year in length, and is backed by the assets of the insurer. The insurer shall be rated in th…

A bank may, without limitation as to capital stock and surplus, purchase bonds, notes, debentures, or other obligations issued by or the payment of which is guaranteed by the United States government or any agency or subdivision thereof, including the Federal Home Loan Mortgage C…

Any bank may purchase and own stock and capital notes or other evidence of debt issued by: (1) An agricultural credit corporation or livestock loan company, or its affiliate, the principal business of which corporation is the extension of short and intermediate term credit to far…

Any bank may purchase and own stock and capital notes or other evidence of debt issued by a mortgage banking company, or its affiliate, the principal business of which is the extension of short, intermediate or long - term credit to individuals, partnerships and corporations, whi…

A bank or other banking organization, organized under the laws of this state, which has as one of its principal purposes the making or purchasing of loans secured by real estate mortgages, may make real estate mortgage loans in any form, including but not limited to variable rate…

A bank may operate a travel agency on its banking premises with the approval of the director. Source: SL 1969, ch 11 , § 4.19; SL 1970, ch 265 , § 32; SDCL, §§ 51-18-1.2, 51-18-20.

Banks and trust companies authorized to do business under this title that are approved or certified by the secretary of housing and urban development or approved or certified by the administrator of veterans affairs may: (1) Make such loans and advances of credit and purchases of…

A bank is expressly empowered, directly or through subsidiaries, to engage in all facets of the insurance business. Source: SL 1983, ch 356 , § 5; SDCL, §§ 51-18-1.3, 51-18-30.

Source: SL 1986, ch 400 , § 12; SDCL, § 51-18-42; SL 2020, ch 4 , § 26.

A bank may purchase cash value life insurance contracts under such limits and restrictions as the commission may prescribe by rules promulgated pursuant to chapter 1-26 . Source: SL 1993, ch 350 .

Any bank may be provided access to motor vehicle title and lien information maintained on the state's computer system via a modem and terminal owned by the bank. The Department of Labor and Regulation shall promulgate rules pursuant to chapter 1-26 to specify access availability.…

Terms used in § 51A-4-45 mean: (1) "Financial institution," a National Banking Association, Federal Savings and Loan Association having its main office in this state, or a bank established and operated under the laws of this state; (2) "Services," receiving deposits, renewing tim…

Unless prohibited by another provision of statute, a financial institution, known as the customer institution, may contract with another financial institution, known as the service institution, to grant the service institution the authority to render services to the depositors, b…

A bank may enter into debt cancellation contracts and debt suspension contracts and charge a fee for those contracts in connection with any extension of credit that it makes to its customers. Source: SL 2004, ch 290 , § 2.

No person, partnership or corporation may advertise, publish or otherwise represent that he is engaged in the business of banking without having first obtained a certificate of authority from the director, as provided in this title. A violation of this section is a Class 1 misdem…

The director may, after determining that any person, partnership or corporation is in violation of § 51A-4-5 , issue an order to cease and desist from all activities determined to be the business of banking. Any right to appeal such an order is subject to the provisions of chapte…

The director may take such action as necessary to cause the arrest and prosecution of any person in violation of §

Any bank authorized to engage in business under this title may obtain insurance of its deposits by the United States or any agency thereof. The commission may, by rule promulgated pursuant to chapter 1-26 , establish requirements for insurance coverage of deposits. Any bank is au…

Except as provided in §§ 51A-4-10 , a bank may lease, purchase, hold, and convey in its own name, or through investment in a corporation organized solely to lease such property to it, only the following real property: (1) That which it occupies or intends to occupy for the transa…