Banking.

Comptroller.

Deputy

15. United States' bonds to be deposited with treasurer. 16. Circulating notes to be delivered to such associations. Limitation.

17. Apportionment of such currency.

18. Notes to be prepared by comptroller. Form thereof. 19. Custody of plates and dies. Payment of expenses. Bank returns. Penalty for neglect to make return.

20. When and how such notes to be issued as currency. To be receivable for taxes, &c. Post notes prohibited.

21. Declaration of trust to be endorsed on bonds held by the treasurer. Registry thereof.

22. Assignments to be registered.

23. To be held as security for circulating notes. Interest. Surrender of bonds regulated. When further deposit of securities to be required.

24. In case of depreciation interest to be retained. To be invested in other bonds.

25. Worn out and mutilated notes to be exchanged for new ones. Destruction of cancelled notes.

26. Penalty for unauthorized delivery of notes.

27. Costs of protest.

28. Penalty for mutilating or defacing notes. 29. Forgery punished. Uttering.

30. Engraving plates, &c. Possession of

V. BANK STATEMENTS.

paper, &c.

31. Examination of bonds pledged. Certificate. 32. Quarterly reports to be made on oath. Form of statement. To be published. Monthly statements to be published in certain cities.

VI. PROCEEDINGS ON FAILURE TO REDEEM.

33. Protest of notes. Business to be thereupon discontinued. 34. Comptroller to ascertain fact of suspension. Securities to be forfeited. Notes to be presented for payment at the treasury. Bonds to be cancelled. Preference of the United States for deficiency.

35. Comptroller may, at his option, sell securities, by auction. 36. Or by private sale.

37. Appointment of receiver. His powers and duties. Proceedings on appointment of receiver. Association may have an issue as to the fact of suspension.

I. BUREAU OF CURRENCY.

25 Feb. 1863 1.

12 Stat. 665.

Bureau of curren

cy established

troller.

1. There shall be established in the treasury department a separate bureau, which shall be charged with the execution of this and all other laws that may be passed by congress respecting the issue and regulation of a national currency secured by United States bonds. The chief officer of the said bureau shall be denominated the comptroller Comptroller. of the currency, and shall be under the general direction of the secretary of the treasury. He shall be appointed by the president, on the nomination of the secretary of the treasury, by and with the advice and consent of the senate, and shall hold his office for the term of five years, unless sooner removed by the president, by and with the 413 advice and consent of the senate; he shall receive an annual salary of five thousand dollars; he shall have a competent deputy, appointed by the secretary, whose salary Deputy compshall be two thousand five hundred dollars, and who shall possess the power and perform the duties attached by law to the office of comptroller during a vacancy in such office, and during his absence or inability; he shall employ from time to time the neces- Clerks. sary clerks to discharge such duties as he shall direct, which clerks shall be appointed and classified by the secretary of the treasury in the manner now provided by law. Within fifteen days from the time of notice of his appointment, the comptroller shall take oath. and subscribe the oath of office prescribed by the constitution and laws of the United States; and he shall give to the United States a bond in the penalty of one hundred thousand Bonds. dollars, with not less than two responsible freeholders as sureties, to be approved by the secretary of the treasury, conditioned for the faithful discharge of the duties of his office. The deputy comptroller so appointed shall also take the oath of office prescribed by the constitution and laws of the United States, and shall give a like bond in the penalty of fifty thousand dollars. The comptroller and deputy comptroller shall not either directly or indirectly be interested in any association issuing national currency under the provisions of this act.

25 Feb. 1863 2. Official seal.

Ibid. 3.

Office of comptroller.

Ibid. 4.

25 Feb. 1863 25. 12 Stat. 666.

Ibid. 26.

Articles of association.

To be acknow

of record.

2. The comptroller of the currency, with the approval of the secretary of the treasury, shall devise a seal with suitable inscriptions for his office, a description of which, with a certificate of approval by the secretary of the treasury, shall be filed in the office of the secretary of state with an impression thereof, which shall thereupon become the seal of office of the comptroller of the currency, and the same may be renewed when necessary. Every certificate, assignment and conveyance executed by the comptroller, in pursuance of any authority conferred on him by law, and sealed with his seal of office, shall be received in evidence in all places and courts whatsoever; and all copies of papers in the office of the comptroller, certified by him and authenticated by the said scal, shall in all cases be evidence equally and in like manner as the original. An impression of such seal directly on the paper shall be as valid as if made on wax or wafer.

3. There shall be assigned to the comptroller of the currency, by the secretary of the treasury, suitable rooms in the treasury building, for conducting the business of the currency bureau, in which shall be safe and secure fire-proof vaults, in which it shall be the duty of the comptroller to deposit and safely keep all the plates and other valuable things belonging to his department; and the comptroller shall from time to time furnish the necessary furniture, stationery, fuel, lights and other proper conveniences for the transaction of the said business.

4. The term "United States bonds," as used in this act, shall be construed to mean all coupon and registered bonds now issued or that may hereafter be issued on the faith of the United States by the secretary of the treasury in pursuance of law.

II. ORGANIZATION OF BANKING COMPANIES.

5. Associations for carrying on the business of banking may be formed by any number of persons, not less in any case than five.

6. Persons uniting to form such an association shall, under their hands and seals, make a certificate, which shall specify

I. The name assumed by such association.

II. The place where its operations of discount and deposit are to be carried on; designating the state, territory or district, and also the particular city, town or village. III. The amount of its capital stock, and the number of shares into which the same shall be divided; which capital stock shall not be less than fifty thousand dollars; and in cities whose population is over ten thousand persons, the capital stock shall not be less than one hundred thousand dollars.

IV. The names and places of residence of the shareholders, and the number of shares held by each of them.

V. The time when such association shall commence.

VI. A declaration that said certificate is made to enable such persons to avail themselves of the advantages of this act.

The said certificate shall be acknowledged before a judge of some court of record or a ledged and filed notary public, and the acknowledgment thereof certified under the seal of such court or notary, and shall be transmitted, together with a copy of the articles of association which shall have been adopted, to the comptroller of the currency, who shall record and Certified copies to carefully preserve the same in his office. Copies of such certificate, duly certified by the comptroller and authenticated by his seal of office, shall be legal and sufficient evidence, in all courts and places within the United States, or the jurisdiction of the government thereof, of the existence of such association, and of every other matter or thing which could be proved by the production of the original certificate.

be evidence.

tal.

Ibid. 27.

Ibid. 28. Stock of delin

7. At least thirty per centum of the capital stock of such association shall be paid in Payment of capi- at the time of the commencement of its banking business, and the remainder of the capital stock of such association shall be paid in instalments of at least ten per centum each on the whole amount to which the association shall be limited, as frequently as one instalment at the end of each succeeding two months from the time of the commencement of its banking operations, until the whole of the capital stock shall be paid in. 8. If any shareholder or his assignee shall fail to pay any instalment on the stock when the same is required by the foregoing section to be paid, the directors of such associaquents to be for- tion may sell the stock held by such delinquent shareholder, at public auction, having given three weeks' previous notice thereof in a newspaper published and of general circulation in the city where the association is located, if the same be located in a city. and if not so located, then in a newspaper printed or of general circulation in the county where the same is located, to any person who will pay the highest price therefor, and not less than the amount then due thereon, with the expenses of advertisement and sale; and the excess, if any, shall be paid to the delinquent shareholder. If no bidder can be found who will pay for such stock the amount due thereon to the association,

feited and sold.

25 Feb. 1863.

Ibid. 29.

and the costs of advertisement and sale, the amount previously paid shall be forfeited to the association, and such stock may subsequently be sold as the directors may order. 9. Whenever a certificate shall have been transmitted to the comptroller of the currency, as provided in this act, and the association transmitting the same shall notify Duties of comp the comptroller that at least thirty per centum of its capital stock has been paid as troller. aforesaid, and that such association has complied with all the provisions of this act required to be complied with before such association shall be authorized to commence the business of banking, and that such association is desirous of commencing such business, the comptroller shall immediately proceed, in such manner as he shali by general rules prescribe, to examine the condition of such association; to ascertain especially the amount of money paid in on account of its capital stock; the name and place of residence of each of the directors of such association, and the amount of the capital stock of which each is the bonâ fide owner, and generally whether such association has complied with all the requirements of this act to entitle it to engage in the business of banking; and shall cause to be made and attested by the oaths of a majority of the directors and by the president or cashier of such association, a statement of all the facts necessary to enable the comptroller to determine whether such association is lawfully entitled to commence the business of banking under this act.

Ibid. 2 10.

10. If upon a careful examination of the facts so reported, and of any other facts which may come to the knowledge of the comptroller, whether by means of a special Comptroller to commission appointed by him for the purpose of inquiring into the condition of such give certificate. association, or otherwise, it shall appear that such association is lawfully entitled to commence the business of banking, the comptroller shall give to such association a certificate, under his hand and official seal, showing that such association has complied with all the provisions of this act required to be complied with before being entitled to commence the business of banking under it, and that such association is authorized to commence said business accordingly; and it shall be the duty of such association to To be published. cause said certificate to be published in some newspaper, published in the city or county where such association is located, for at least sixty days next after the issuing thereof: Provided, That if no newspaper is published in such city or county, such certificate shall be published as the comptroller of the currency shall direct.

III. CORPORATE POWERS.

12 Stat. 668.

of banking associations.

11. Every association formed pursuant to the provisions of this act may make and use 25 Feb. 1863 ? 11. a common seal, and shall have succession by the name designated in its articles of association and for the period limited therein, not, however, exceeding twenty years Corporate powers from the passage of this act; by such name may make contracts, sue and be sued, complain and defend in any court of law or equity as fully as natural persons; and may make by-laws, approved by the comptroller of the currency, not inconsistent with the laws of the United States or the provisions of this act, for the election of directors, the management of its property, the regulation of its affairs, and for the transfer of its stock; and shall have power to carry on the business of banking by obtaining and issuing circulating notes in accordance with the provisions of this act; by discounting bills, notes and other evidences of debt; by receiving deposits; by buying and selling gold and silver bullion, foreign coins and bills of exchange; by loaning money on real and personal security, in the manner specified in their articles of association, for the purposes authorized by this act; and by exercising such incidental powers as shall be necessary to carry on such business; to choose one of their number as president of such association, and to appoint a cashier and such other officers and agents as their business may require; and to remove such president, cashier, officers and agents at pleasure, and appoint others in their place; and their usual business shall be transacted in banking offices located at the places specified respectively in its certificate of association, and not elsewhere.

Ibid. 12.

Transfers regu

12. The shares of associations formed under this act shall be deemed personal property, and shall be transferrable on the books of the association in such manner as may shares to be perbe prescribed in the by-laws or articles of association; and every person becoming a sonal property. shareholder by such transfer shall, in proportion to his shares, succeed to all the rights and liabilities of the prior holder of such shares; and no change shall be made in the lated. articles of association by which the rights, remedies or security of the existing creditors of the association shall be impaired. For all debts contracted by such association for Personal liability circulation, deposits or otherwise, each shareholder shall be liable to the amount, at their par value, of the shares held by him in addition to the amount invested in such shares.

of stockholders.

Ibid. 13.

13. It shall be lawful for any association formed under this act, by its articles of association, to provide for an increase of its capital, from time to time, as may be deemed Increase of capiexpedient, subject to the limitations of this act; but no such increase shall be valid tal.

25 Feb. 1863.

Ibid. 14. Power to hold real estate.

25 Feb. 1863 15. 12 Stat. 669.

United States

bonds to be deposited with treasurer.

Ibid. 16.

Circulating notes to be delivered to

such associations.

Limitation.

Ibid. 17. Apportionment of such currency.

Ibid. 18.

Notes to be prepared by comp troller.

Form thereof.

peuses.

until the increased capital shall be paid in, and notice thereof shall have been transmitted to the comptroller of the currency, and his certificate obtained, specifying the amount of such increase of capital stock, and that the same has been duly paid to such association.

14. It shall be lawful for any such association to purchase, hold and convey real estate as follows:

I Such as shall be necessary for its immediate accommodation in the transaction of its business.

II. Such as shall be mortgaged to it in good faith by way of security for loans made by such association, or for moneys due thereto.

III. Such as shall be conveyed to it in satisfaction of debts previously contracted in the course of its dealings.

IV. Such as it shall purchase at sales under judgments, decrees or mortgages held by such association.

Such association shall not purchase or hold real estate in any other case or for any other purpose than as specified in this section.

IV. BANK NOTES.

15. Every association, after having complied with the provisions of this act preliminary to the commencement of banking business under its provisions, shall transfer and deliver to the treasurer of the United States any United States bonds bearing interest to an amount not less than one-third of the capital stock paid in; which bonds shall be deposited with the treasurer of the United States, and by him safely kept in his office until the same shall be otherwise disposed of, in pursuance of the provisions of this act. 16. Upon the making of any such transfer and delivery, the association making the same shall be entitled to receive from the comptroller of the currency circulating notes of different denominations, in blank, registered and countersigned as hereinafter provided, equal in amount to ninety per centum of the current market value of the United States bonds so transferred and delivered, but not exceeding the par value thereof, if bearing interest, at the rate of six per centum, or of equivalent United States bonds bearing a less rate of interest; and at no time shall the total amount of such notes, issued to any such association, exceed the amount at such time actually paid in of its capital stock.

17. The entire amount of circulating notes to be issued under this act shall not exceed three hundred millions of dollars. One hundred and fifty millions of which sum shall be apportioned to associations in the states, in the District of Columbia and in the territories, according to representative population, and the remainder shall be apportioned by the secretary of the treasury among associations formed in the several states, in the District of Columbia, and in the territories, having due regard to the existing banking capital, resources and business of such states, district and territories.

18. In order to furnish suitable notes for circulation, the comptroller of the currency is hereby authorized and required, under the direction of the secretary of the treasury, to cause plates to be engraved in the best manner to guard against counterfeiting and fraudulent alterations, and to have printed therefrom, and numbered, such quantity of circulating notes, in blank, of the denominations of five dollars, ten dollars, twenty dollars, fifty dollars, one hundred dollars, five hundred dollars and one thousand dollars, as may be required to supply, under this act, the associations entitled to receive the same; which notes shall express upon their face that they are secured by United States bonds, deposited with the treasurer of the United States, and issued under the provisions of this act, which statement shall be attested by the written or engraved signatures of the treasurer and register, and by the imprint of the seal of the treasury; and shall also express upon their face the promise of the association receiving the same to pay on demand, attested by the signatures of the president, or vice president, and cashier; and the said notes shall bear such devices and such other statements, and shall be in such form, as the secretary of the treasury shall, by regulation, direct.

Ibid. 19. 19. The plates and special dies to be procured by the comptroller of the currency for the printing of such circulating notes, shall remain under his control and direction, and Custody of plates and dies. the expenses necessarily incurred in executing the provisions of this act respecting the procuring of such notes, shall be audited and paid as contingent expenses of the treasury Payment of ex department; and for the purpose of reimbursing the same, and all other expenses incurred under this act, and in lieu of all taxes upon the circulation authorized by this act, or upon the bonds deposited for the security of the same, such association organized under this act shall semi-annually, on the first days of January and July, after its organization, pay to the comptroller of the currency, in lawful money of the United States, one per centum on the amount of circulating notes received by such association, and in default thereof, the treasurer of the United States is hereby authorized to reserve and retain one

per centum on the amount of said bonds so deposited at each semi-annual payment of 25 Feb. 1863. interest thereon; and all sums so reserved and retained shall be paid into the treasury Bank returns. under the direction of the secretary; and every bank, banking association or corporation, not organized under the provisions of this act, issuing notes calculated or intended to circulate as money, shall, on the first day of July next, and regularly on the first days of January and July thereafter, make and deliver to the comptroller of the currency a true and accurate return of the gross amount of notes issued by it, whether in circulation, or in its vaults, or on deposit elsewhere, and in default of any such return, the bank, banking association or corporation so failing to make return, shall pay to the Penalty for neg United States a penalty of two per centum upon its entire capital stock, to be recovered, turn. for the use of the United States, in any court of competent jurisdiction.

lect to make re

be issued as cur

20. After any such association shall have caused its promise to pay such notes on Ibid. 20. demand to be signed by the president or vice president and cashier thereof, in such when and how manner as to make them obligatory promissory notes, payable on demand, at its place such notes may of business, such association is hereby authorized to issue and circulate the same as rency. money; and the same shall be received at par in all parts of the United States in payment of taxes, excises, public lands and all other dues to the United States, except for To be receivable duties on imports, and also for all salaries and other debts and demands owing by the United States to individuals, corporations and associations within the United States, except interest on public debt; and no such association shall issue post-notes or any Post-notes proother notes to circulate as money, than such as are authorized by the foregoing provisions of this act.

for taxes, &c.

hibited.

Ibid. 21.

dorsed on bonds

21. All transfers of United States bonds which shall be made by any association as security for circulating notes under the provisions of this act, shall be made to the trea- Declaration of surer of the United States, with a memorandum written or printed on the certificate of trust to be insuch bonds, and signed by the cashier or some other officer of the association making held by the treas the deposit, stating that it is held in trust for the association on whose behalf such urer. transfer is made, and as security for the redemption and payment of the circulating notes delivered to such association; and no transfer of any such bonds by the treasurer shall be deemed valid or of binding force and effect, unless sanctioned by the order or request of the comptroller of the currency upon the treasurer. It shall be the duty of Registry thereof. the comptroller of the currency to keep in his office a book, in which shall be entered the name of every association from whose account such transfer of bonds is made by the treasurer, and the name of the party to whom such transfer is made, unless such transfer is made in blank, in which case the fact shall be stated in said book, and in either case the par value of the bonds so transferred shall be entered therein; and it shall be the duty of the comptroller, immediately upon countersigning and entering the same, to advise by mail the association from whose account such transfer was made, the kind of bonds and the amount thereof so transferred.

Ibid. 22.

Ibid. 30.

22. It shall be the duty of the comptroller of the currency to countersign and enter in the book, in the manner aforesaid, every transfer or assignment of any bonds held Assignments to by the treasurer presented for his signature; and the comptroller shall have at all be registered. times, during office hours, access to the books of the treasurer, for the purpose of ascertaining the correctness of the transfer or assignment presented to him to countersign; and the treasurer shall have the like access to the book above mentioned, kept by the comptroller, during office hours, to ascertain the correctness of the entries in the same. 23. The bonds transferred to the treasurer of the United States, as herein before provided, by any banking association for the security of its circulating notes, shall be held To be held as se exclusively for that purpose until such notes shall be redeemed, except as provided in curity for circulating notes. this act; but the comptroller of the currency may give to any such banking association Interest. powers of attorney to receive and appropriate to its own use the interest on the bonds which shall have been so transferred to the treasurer by it; but such powers shall become inoperative whenever such banking association shall fail to redeem its circulating notes as aforesaid; and said comptroller may direct the return of any of said bonds to Surrender of the banking association which transferred the same, upon the surrender to him, and the bonds regulated. cancellation of a proportionate amount of such circulating notes: Provided, That ninety per centum of the current market value of the remaining bonds, which shall have been transferred by the banking association offering to surrender such circulating notes, shall be equal to the amount of all the circulating notes retained by such banking association: And provided further, That there shall have been no failure by such association to redeem its circulating notes, and that there shall have been no other violation by such association of any of the provisions of this act for the security of the creditors of such association; nor shall the treasurer be required to surrender such bonds in frac tional sums of less than one thousand dollars; and if, at any time after said bonds shall be deposited with the treasurer of the United States as aforesaid, the market or