2005 Nevada Revised Statutes - Chapter 657 — General Provisions

Title 55 - BANKS AND RELATED ORGANIZATIONS

CHAPTER 657 - GENERAL PROVISIONS

GENERAL PROVISIONS

NRS 657.005 Definitions.

NRS 657.016 Bank,commercial bank, banking company and banking corporation defined.

NRS 657.026 Commissionerdefined.

NRS 657.035 Demanddeposits defined.

NRS 657.037 Depositoryinstitution defined.

NRS 657.040 Divisionof Financial Institutions defined.

NRS 657.045 Insolvencydefined.

NRS 657.055 Netearnings defined.

NRS 657.058 Nevada defined.

NRS 657.064 Savingsdeposit defined.

NRS 657.070 Stockholdersequity and members equity defined.

NRS 657.075 Surplusdefined.

NRS 657.085 Timedeposit defined.

NRS 657.095 Applicabilityof chapters 78, 86and 92A of NRS.

MISCELLANEOUS

NRS 657.105 Effectof title on powers, privileges, duties and restrictions of corporations,companies, associations and natural persons.

NRS 657.120 Feesand charges: Imposition and collection by financial institution; limitations.

NRS 657.130 Committeesto review compliance: Definitions; confidentiality and privilege.

NRS 657.140 Loanagreements: Certain provisions for recovery prohibited; exceptions.

FINANCIAL INSTITUTIONS

NRS 657.150 Definitions.

NRS 657.160 Financialinstitution defined.

NRS 657.170 Licensedefined.

NRS 657.180 Licenseto operate or manage: Additional requirements; fingerprints; grounds forrefusal to issue license.

NRS 657.190 Suspensionor revocation of license to operate or manage: Additional grounds.

NRS 657.200 Useor change of business name; prohibitions.

NRS 657.210 Authorizationof Commissioner to investigate business; free access required; compellingattendance of witnesses.

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GENERAL PROVISIONS

NRS 657.005 Definitions. As used in this title, unless the context otherwiserequires, the words and terms defined in NRS657.016 to 657.085, inclusive, havethe meanings ascribed to them in those sections.

(Added to NRS by 1971, 965; A 1985, 737, 2148; 1987,1897; 1995, 1549; 1997, 974)

NRS 657.016 Bank,commercial bank, banking company and banking corporation defined. Bank, commercial bank, banking company or bankingcorporation means a corporation or limited-liability company that is charteredby this State, another state or the United States and conducts the business ofreceiving money as demand deposits or otherwise carries on a banking or bankingand trust business. The terms do not include a thrift company engaged inbusiness pursuant to chapter 677 of NRS.

(Added to NRS by 1971, 965; A 1985, 737; 1989, 2031;1995, 473, 1549; 1997, 974)

NRS 657.026 Commissionerdefined. Commissioner means the Commissionerof Financial Institutions.

(Added to NRS by 1987, 1897)

NRS 657.035 Demanddeposits defined. Demand deposits means alldeposits the immediate withdrawal of which can be legally required upon aproper written request for such payment.

(Added to NRS by 1971, 965)

NRS 657.037 Depositoryinstitution defined. Depository institutionmeans any bank, savings and loan association, savings bank, thrift company,credit union or other institution, whether chartered by this State, anotherstate or the Federal Government, which:

1. Holds or receives deposits, savings or shareaccounts;

2. Issues certificates of deposit; or

3. Provides to its customers other depository accountswhich are subject to withdrawal by checks, drafts or other instruments or byelectronic means to effect payment to a third party.

(Added to NRS by 1985, 2147; A 1989, 2032; 1995,1549)

NRS 657.040 Divisionof Financial Institutions defined. Division ofFinancial Institutions means the Division of Financial Institutions of theDepartment of Business and Industry.

(Added to NRS by 1983, 1721; A 1993, 1894)

NRS 657.045 Insolvencydefined. Insolvency means one or more of thefollowing:

1. When a bank cannot meet its deposit liabilities asthey become due in the regular course of business.

2. When the actual cash market value of a banksassets is insufficient to pay its liabilities to depositors and othercreditors.

3. When a banks reserve falls under the amountrequired by this title, and it fails to make good such reserve within 30 daysafter being required to do so by the Commissioner.

4. When the undivided profits and surplus areinadequate to cover losses of the bank and the stockholders or members equityof the bank has been reduced below the requirements of law.

(Added to NRS by 1971, 965; A 1983, 1721; 1987, 1897;1997, 974)

NRS 657.055 Netearnings defined. Net earnings means theexcess of the gross earnings of any bank over the expenses and losseschargeable against such earnings.

(Added to NRS by 1971, 965)

NRS 657.058 Nevadadefined. Nevada when used to modify:

1. The word bank or the term depositoryinstitution means organized under the laws of this State; and

2. The term national bank means having itsheadquarters within this State.

(Added to NRS by 1995, 1549)

NRS 657.064 Savingsdeposit defined. Savings deposit means a depositor account:

1. With respect to which the depository institutionmay require the depositor to give written notice of withdrawal not less than 7days before a withdrawal, but from which the depositor may otherwise makewithdrawals without giving written notice; and

2. Which is not payable on a specific date or at the expirationof a specified time after the date of deposit.

(Added to NRS by 1985, 737)

NRS 657.070 Stockholdersequity and members equity defined. Stockholdersequity or members equity means the capital, surplus and retained earningsof a bank.

(Added to NRS by 1997, 974)

NRS 657.075 Surplusdefined. Surplus means a fund createdpursuant to the provisions of this title by a bank from payments bystockholders or members or from the banks net earnings or undivided profitswhich, to the amount specified and by any additions thereto set apart anddesignated as such, is not available for the payment of dividends and cannot beused for the payment of expenses or losses while the bank has undividedprofits.

(Added to NRS by 1971, 965; A 1995, 473)

NRS 657.085 Timedeposit defined. Time deposit means adeposit which:

1. The depositor does not have a right to withdraw fora period of 7 days or more after the date of deposit; and

2. Is payable at the expiration of a specified timenot less than 7 days after the date of deposit.

(Added to NRS by 1971, 965; A 1985, 737)

NRS 657.095 Applicabilityof chapters 78,86 and92Aof NRS. The provisions of chapters 78, 86and 92A of NRS that are not in conflict withthis title are hereby adopted as a part of this title.

(Added to NRS by 1971, 966; A 1995, 473; 1997, 975)

MISCELLANEOUS

NRS 657.105 Effectof title on powers, privileges, duties and restrictions of corporations,companies, associations and natural persons.

1. The powers, privileges, duties and restrictionsconferred and imposed upon any corporation, company, association or naturalperson, existing and doing business under the laws of this State, are herebyabridged, enlarged or modified, as each particular case may require, to conformto the provisions of this title, notwithstanding anything to the contrary inits respective articles of incorporation, articles of organization or charter.

2. As used in this section, doing business under thelaws of this State does not include the lending of money to a person who isnot a resident of this State, whether or not the bank which extended the creditor serviced the loan is located in this State.

(Added to NRS by 1971, 966; A 1989, 2032; 1995, 473)

NRS 657.120 Feesand charges: Imposition and collection by financial institution; limitations.

1. A financial institution may impose and collect afee or charge, not to exceed an amount specified in or limited by specificstatute, for any service it provides to a customer, if the fee or charge isclearly and conspicuously disclosed in writing to the customer before thecustomer receives the service. A financial institution must provide a customerwith written notice of any increase in the fee or charge at least 10 daysbefore the increase becomes effective.

2. A fee or charge for the presentation for payment,on a single business day, of multiple checks drawn by a customer on an accountfor which there is an insufficient balance to pay all the checks, must bedetermined as if the checks drawn in a single series or class were presented:

(a) In the order the checks were written;

(b) From the lowest check number to the highest checknumber; or

(c) In order of ascending amounts, the check for thesmallest sum being presented first.

3. As used in this section, financial institutionmeans an institution licensed pursuant to the provisions of this title or title56 or chapter 645B, 645E or 649 ofNRS, or a similar institution chartered or licensed pursuant to federal law.

(Added to NRS by 1989, 566; A 1999, 3809)

NRS 657.130 Committeesto review compliance: Definitions; confidentiality and privilege.

1. As used in this section, unless the contextotherwise requires:

(a) Committee to review compliance means one or morepersons assigned or engaged by a financial institution to test, review orevaluate its conduct, transactions or potential transactions, policies orprocedures for the purpose of monitoring and improving or enforcing compliancewith state and federal statutes and regulations requiring safe, sound and fairlending practices, including, without limitation, acts concerning equal creditopportunity, fair housing, fair lending, flood zone protection, housing andfinancial discrimination, truth in lending and financial reporting to federal orstate regulatory agencies.

(b) Financial institution means an institutionlicensed pursuant to the provisions of this title or title 56 or chapter 645B or 645Eof NRS, or a similar institution chartered or licensed pursuant to federal law.The term includes, without limitation, a holding company, affiliate orsubsidiary of such an institution.

2. Except as otherwise voluntarily authorized by thefinancial institution:

(a) A document prepared for or created by a committeeto review compliance is confidential and privileged, and is not subject todiscovery or admissible in evidence in a civil action of this State, even if ithas been submitted to a governmental or regulatory agency of this State, theUnited States or a foreign government.

(b) A member of a committee to review compliance or aperson who acted under the direction of the committee cannot be required totestify in a civil action concerning the contents of a document described inparagraph (a) or concerning the discussions or conclusions of, or the actionstaken by, the committee.

(Added to NRS by 1995, 1784; A 1999, 3809)

NRS 657.140 Loanagreements: Certain provisions for recovery prohibited; exceptions.

1. Except as otherwise provided in subsection 2, afinancial institution shall not include in any loan agreement a provision that allowsthe financial institution to recover, take, appropriate or otherwise apply as asetoff against any debt or liability owing to the financial institution underthe loan agreement money from an account unrelated to the loan agreement to theextent the money is exempt from execution pursuant to paragraph (x) ofsubsection 1 of NRS 21.090.

2. The provisions of subsection 1 do not apply to aprovision in a loan agreement that specifically authorizes automaticwithdrawals from an account.

3. The provisions of this section may not be varied byagreement and the rights conferred by this section may not be waived. Anyprovision included in an agreement that conflicts with this section is void.

4. As used in this section:

(a) An account unrelated to the loan agreementincludes, without limitation, an account pledged as security under the loan agreement,unless the specific account pledged as security is conspicuously described inthe loan agreement.

(b) Financial institution means an institutionlicensed pursuant to the provisions of this title or title 56 or chapter 645B, 645Eor 649 of NRS, or a similar institutionchartered or licensed pursuant to federal law.

(Added to NRS by 2005, 382)

FINANCIAL INSTITUTIONS

NRS 657.150 Definitions. As used in NRS 657.150to 657.210, inclusive, unless the contextotherwise requires, the words and terms defined in NRS 657.160 and 657.170 have the meanings ascribed to themin those sections.

(Added to NRS by 2005, 1841)

NRS 657.160 Financialinstitution defined. Financial institutionmeans a depository institution or any other institution regulated pursuant tothis title. The term includes, without limitation, a holding company, affiliateor subsidiary of such an institution.

(Added to NRS by 2005, 1841)

NRS 657.170 Licensedefined. License means any license,certificate, registration, permit or similar type of authorization.

(Added to NRS by 2005, 1841)

NRS 657.180 Licenseto operate or manage: Additional requirements; fingerprints; grounds forrefusal to issue license.

1. In addition to any other requirements set forth byspecific statute, each person who applies for a license to operate a financialinstitution and each person who will serve as a director, officer, manager ormember acting in a managerial capacity for such a financial institution mustsubmit:

(a) Proof satisfactory to the Commissioner that theperson:

(1) Has a good reputation for honesty,trustworthiness and integrity and is competent to transact the business of thefinancial institution in a manner which protects the interests of the generalpublic.

(2) Has not made a false statement of materialfact on the application.

(3) Has not committed any of the acts specifiedin subsection 2.

(4) Has not had a license to operate a financialinstitution suspended or revoked within the 10 years immediately preceding thedate of the application.

(5) Has not been convicted of, or entered a pleaof nolo contendere to, a felony or any crime involving fraud, misrepresentationor moral turpitude.

(b) A complete set of his fingerprints and writtenpermission authorizing the Division of Financial Institutions to forward thefingerprints to the Central Repository for Nevada Records of Criminal Historyfor submission to the Federal Bureau of Investigation for its report.

2. In addition to any other lawful reasons, theCommissioner may refuse to issue a license to operate a financial institutionif the person who applies for the license or any person who will serve as adirector, officer, manager or member acting in a managerial capacity for thefinancial institution:

(a) Has committed or participated in any act which, ifcommitted or done by a holder of a license, would be grounds for the suspensionor revocation of the license.

(b) Has previously been refused a license to operate afinancial institution or has had such a license suspended or revoked.

(c) Has participated in any act which was a basis forthe refusal or revocation of a license to operate a financial institution.

(d) Has falsified any of the information submitted tothe Commissioner in support of the application for the license.

(Added to NRS by 2005, 1841)

NRS 657.190 Suspensionor revocation of license to operate or manage: Additional grounds. In addition to any other lawful reasons, the Commissionermay suspend or revoke a license to operate a financial institution if theperson who holds the license or any person who serves as a director, officer,manager or member acting in a managerial capacity for the financial institutionhas engaged in any act that would be grounds for denying a license pursuant to NRS 657.180.

(Added to NRS by 2005, 1842)

NRS 657.200 Useor change of business name; prohibitions.

1. A financial institution must obtain the approval ofthe Commissioner before using or changing a business name.

2. A financial institution shall not:

(a) Use any business name which is identical or similarto a business name used by another financial institution or which may misleador confuse the public.

(b) Use any printed forms which may mislead or confusethe public.

(Added to NRS by 2005, 1842)

NRS 657.210 Authorizationof Commissioner to investigate business; free access required; compellingattendance of witnesses.

1. For the purpose of discovering violations of thistitle or of securing information lawfully required under this title, theCommissioner or his duly authorized representatives may at any time investigatethe business and examine the books, accounts, papers and records used thereinof:

(a) Any licensee;

(b) Any other person engaged in an activity for which alicense is required pursuant to the provisions of this title; and

(c) Any person whom the Commissioner has reasonablecause to believe is violating or is about to violate any provision of thistitle, whether or not the person claims to be within the authority or beyondthe scope of this title.

2. For the purpose of examination, the Commissioner orhis authorized representatives must have and be given free access to theoffices and places of business, files, safes and vaults of such persons.

3. The Commissioner may require the attendance of anyperson and examine him under oath regarding:

(a) Any transaction or business regulated pursuant tothe provisions of this title; or

(b) The subject matter of any audit, examination,investigation or hearing.

(Added to NRS by 2005, 1842)

 

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