§55 — Title 12 Banks and Banking | U.S. Code

Summary

If a bank or association has not paid its required capital or its capital has been reduced, it must pay the missing amount within three months after the Comptroller of the Currency notifies it. The money is raised by charging each shareholder in proportion to the stock they own. The Treasurer of the United States must stop paying interest on any bonds he holds for that association when the Comptroller tells him, until told to resume. If the bank still does not pay and refuses to liquidate after three months, a receiver can be appointed to close the business under section 192. If a shareholder does not pay the assessment after three months’ notice, the board must sell enough of that person’s stock at public auction to cover the debt. The sale must be announced by posting notice at the bank and by publishing it in the local newspaper at least thirty days before the sale. Any extra money from the sale must be returned to the shareholder.

Title 12, §55

Banks and Banking — Source: USLM XML via OLRC

Every association which shall have failed to pay up its capital stock, as required by law, and every association whose capital stock shall have become impaired by losses or otherwise, shall, within three months after receiving notice thereof from the Comptroller of the Currency, pay the deficiency in the capital stock, by assessment upon the shareholders pro rata for the amount of capital stock held by each; and the Treasurer of the United States shall withhold the interest upon all bonds held by him in trust for any such association, upon notification from the Comptroller of the Currency, until otherwise notified by him. If any such association shall fail to pay up its capital stock, and shall refuse to go into liquidation, as provided by law, for three months after receiving notice from the comptroller, a receiver may be appointed to close up the business of the association, according to the provisions of section 192 of this title. And provided, That if any shareholder or shareholders of such bank shall neglect or refuse, after three months’ notice, to pay the assessment, as provided in this section, it shall be the duty of the board of directors to cause a sufficient amount of the capital stock of such shareholder or shareholders to be sold at public auction (after thirty days’ notice shall be given by posting such notice of sale in the office of the bank, and by publishing such notice in a newspaper of the city or town in which the bank is located, or in a newspaper published nearest thereto,) 11 So in original. to make good the deficiency, and the balance, if any, shall be returned to such delinquent shareholder or shareholders.

Notes & Related Subsidiaries

Editorial Notes

Codification R.S. § 5205 derived from act Mar. 3, 1873, ch. 269, § 1, 17 Stat. 603.

Statutory Notes and Related Subsidiaries

Application to District of ColumbiaProvisions of this section were made applicable to banks, etc., in the District of Columbia by act Mar. 4, 1933, ch. 274, § 4, 47 Stat. 1567.

Executive Documents

Transfer of Functions

All functions of all officers of the Department of the Treasury, and all functions of all agencies and employees of such Department, were transferred, with certain exceptions, to the Secretary of the Treasury, with power vested in him to authorize their performance or the performance of any of his functions, by any of those officers, agencies, and employees, by 1950 Reorg. Plan No. 26, §§ 1, 2, eff. July 31, 1950, 15 F.R. 4935, 64 Stat. 1280, formerly set out in the Appendix to Title 5, Government Organization and Employees. See section 321(c) of Title 31, Money and Finance. The Comptroller of the Currency and the Treasurer of the United States, both referred to in this section, are officers of the Treasury Department, but such Plan excepted, from the transfer, any function vested by law in the Comptroller of the Currency.

§55 Enforcing Payment of Deficiency in Capital Stock; Assessments; Liquidation; Receivership