2005 Nevada Revised Statutes - Chapter 662 — Powers and Miscellaneous Provisions

CHAPTER 662 - POWERS AND MISCELLANEOUSPROVISIONS

GENERAL PROVISIONS

NRS 662.015 Generalpowers of banks; power of Commissioner to waive or modify requirements of law.

NRS 662.025 Powerto participate in Federal Deposit Insurance Corporation.

NRS 662.035 Powerto maintain separate departments; deposit of money held in fiduciary capacity;regulations.

INVESTMENTS; RESERVES; LOAN LIMITS

NRS 662.046 Dealingin investment securities prohibited.

NRS 662.055 Investmentsin public securities.

NRS 662.065 Investmentsin private securities; limitation.

NRS 662.075 Investmentsauthorized as security for deposits of public money.

NRS 662.085 Reservenot required against deposits secured by obligations of or guaranteed by United States; obligations as valid security.

NRS 662.095 Investmentin obligations approved by Federal Housing Administrator, Department ofVeterans Affairs, national mortgage association or Federal Home Loan Bank;conditions for making loans; obligations as collateral, deposits or investmentof equity; exemption from certain laws.

NRS 662.097 Investmentsin securities of management investment trust or management investment company.

NRS 662.099 Investmentin development corporation, corporation for economic revitalization anddiversification, corporation for community development or similar corporation.

NRS 662.101 Investmentsin loans to finance interests in cooperative housing corporations.

NRS 662.103 Investmentin real property for development: Limitations; filing of disclosure withCommissioner; failure to make disclosure unlawful.

NRS 662.105 Stockoptions and purchases for directors, officers and employees.

NRS 662.115 Issuanceof capital notes, debentures and collateralized debt securities andcertificates.

NRS 662.125 Limitationson lending on security of or acquisition of own stock or members interests;sale and ownership of collateral security.

NRS 662.135 Limitationson investment in stock of or membership in other banks and businessorganizations.

NRS 662.145 Limitson amount of loans; exceptions.

NRS 662.155 Limiton combination of investments and loans involving single obligor, person orentity.

NRS 662.175 Limitationson borrowing money and pledging assets; exceptions; purchase of federal reservemoney deemed transfer.

NRS 662.186 Operatingcash: Minimum cash and demand balances; reserves.

NRS 662.205 Membershipin Federal Reserve Bank: Authorization; powers, duties and examination ofmember.

SAVINGS BANK BUSINESS

NRS 662.215 Authorization;deposits; requirements of receipt or passbook; quarterly or annual statementsrequired; issuance of time certificates.

PAYMENTS IN EXCHANGE

NRS 662.225 Checkspayable in exchange.

TRUST COMPANY BUSINESS

NRS 662.231 Businessof a trust company and trust company business defined.

NRS 662.235 Powersand duties when carrying on trust company business; segregation of assets andrecordkeeping.

NRS 662.239 Conditionsand limitations on maintaining trust offices in Nevada and other states;regulations.

NRS 662.245 Conditionsand limitations on certain foreign organizations acting as fiduciary; fees;bond; requirements for service of process; regulations.

CLOSING OF BANKS

NRS 662.255 Voluntaryclosure on Saturdays, Sundays and holidays; transaction of business.

NRS 662.265 Emergencyclosure: Definitions.

NRS 662.275 Emergencyclosure: Powers of Commissioner.

NRS 662.285 Emergencyclosure: Powers of banks officers.

NRS 662.295 Emergencyclosure: Notification of Commissioner or Comptroller of the Currency.

NRS 662.305 Emergencyclosure: Effect of closing.

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GENERAL PROVISIONS

NRS 662.015 Generalpowers of banks; power of Commissioner to waive or modify requirements of law.

1. In addition to the powers conferred by law uponprivate corporations and limited-liability companies, a bank may:

(a) Exercise by its board of directors, managers orauthorized officers and agents, subject to law, all powers necessary to carryon the business of banking by:

(1) Discounting and negotiating promissorynotes, drafts, bills of exchange and other evidences of indebtedness;

(2) Receiving deposits;

(3) Buying and selling exchange, coin andbullion; and

(4) Loaning money on personal security or realand personal property.

At the timeof making loans, banks may take and receive interest or discounts in advance.

(b) Adopt regulations for its own government notinconsistent with the Constitution and laws of this State.

(c) Issue, advise and confirm letters of creditauthorizing the beneficiaries to draw upon the bank or its correspondents.

(d) Receive money for transmission.

(e) Establish and become a member of a clearinghouseassociation and pledge assets required for its qualification.

(f) Exercise any authority and perform all acts that anational bank may exercise or perform, with the consent and written approval ofthe Commissioner. The Commissioner may, by regulation, waive or modify arequirement of Nevada law if the corresponding requirement for national banksis eliminated or modified.

(g) Provide for the performance of the services of abank service corporation, such as data processing and bookkeeping, subject toany regulations adopted by the Commissioner.

(h) Unless otherwise specifically prohibited by federallaw, sell annuities if licensed by the Commissioner of Insurance.

2. A bank may purchase, hold and convey real property:

(a) As is necessary for the convenient transaction ofits business, including furniture and fixtures, with its banking offices andfor future site expansion. This investment must not exceed, except as otherwiseprovided in this section, 60 percent of its stockholders or members equity,plus subordinated capital notes and debentures. The Commissioner may authorizeany bank located in a city whose population is more than 10,000 to invest morethan 60 percent of its stockholders or members equity, plus subordinatedcapital notes and debentures, in its banking offices, furniture and fixtures.

(b) As is mortgaged to it in good faith by way ofsecurity for loans made or money due to the bank.

(c) As is permitted by NRS 662.103.

3. This section does not prohibit any bank fromholding, developing or disposing of any real property it may acquire throughthe collection of debts due it. Any real property acquired through thecollection of debts due it may not be held for longer than 10 years. It must besold at private or public sale within 30 days thereafter. During the time thatthe bank holds the real property, the bank shall charge off the real propertyon a schedule of not less than 10 percent per year, or at a greater percentageper year as the Commissioner may require.

(Added to NRS by 1971, 979; A 1979, 556, 1387, 1388;1983, 1736; 1985, 1051; 1987, 1911; 1989, 1933; 1993, 2279; 1995, 484, 1550;1997, 986, 3514)

NRS 662.025 Powerto participate in Federal Deposit Insurance Corporation. Subject to the approval of the Commissioner, and on theauthority of a majority of its managers or board of directors, a bank may:

1. Enter into such contracts, incur such obligationsand generally do and perform any or all such acts and things whatsoever as maybe necessary or appropriate in order to take advantage of any or allmemberships, loans, subscriptions, contracts, grants, rights or privilegeswhich may at any time be available to inure to banking institutions, or totheir depositors, creditors, stockholders, members, conservators, receivers orliquidators, by virtue of those provisions of the Federal Deposit InsuranceAct, 12 U.S.C. 1811-1831, which creates the Federal Deposit InsuranceCorporation and provides for the insurance of deposits, or of any otherprovisions of that or any other act or resolution of the Congress to aid,regulate or safeguard banking institutions and their depositors, including anyamendments to such acts, laws or resolutions or substitutions therefor.

2. Subscribe for and acquire any stock, debentures,bonds or other types of securities of the Federal Deposit Insurance Corporationand shall comply with the lawful regulations and requirements from time to timeissued or made by the Federal Deposit Insurance Corporation.

(Added to NRS by 1971, 980; A 1983, 1737; 1987, 1912;1995, 485)

NRS 662.035 Powerto maintain separate departments; deposit of money held in fiduciary capacity;regulations.

1. A bank may maintain separate departments anddeposit in its commercial department to the credit of its trust department alluninvested fiduciary moneys of cash and secure, under rules and regulations ofthe Commissioner, all such deposits in the name of the trust department,whether in consolidated deposits or for separate fiduciary accounts, bysegregating and delivering to the trust department securities which areeligible for the security of money of the State of Nevada under subsection 1 ofNRS 356.020. Such securities must beheld by the trust department as security for the full payment or repayment ofall such deposits and must be kept separate and apart from other assets of thetrust department. Until all such deposits have been accounted for to the trustdepartment or to the individual fiduciary account, no creditor of the bank hasany claim or right to such securities.

2. When fiduciary money is deposited by the trustdepartment in the commercial department of the bank, the deposit thereof doesnot constitute a use of such money in the general business of the bank and thebank in this instance is not liable for interest on such money.

3. To the extent and in the amount such deposits maybe insured by the Federal Deposit Insurance Corporation, the amount of securityrequired for such deposits may be reduced.

4. The Commissioner may make such regulations as hedeems necessary for the enforcement of the provisions of this section.

(Added to NRS by 1971, 981; A 1983, 964, 1737; 1987,1913)

INVESTMENTS; RESERVES; LOAN LIMITS

NRS 662.046 Dealingin investment securities prohibited.

1. As used in this section dealing in investmentsecurities does not include the purchasing and selling of securities withoutrecourse solely upon order and for the account of customers.

2. Banks shall not engage in the business of dealingin any investment securities, either directly or through subsidiarycorporations, except as otherwise provided in this title for investment inpublic securities or private securities.

3. Any provision contained in the articles ofincorporation issued to any banking corporation before July 1, 1971, which isin conflict with this section is revoked.

(Added to NRS by 1971, 981; A 1995, 485)

NRS 662.055 Investmentsin public securities.

1. Notwithstanding any restrictions or limitations oninvestment contained in any law of this state, a bank may, without limitation,invest its funds in public securities which include:

(a) Obligations of the United States, its agencies orother obligations guaranteed by the United States Government.

(b) Obligations of the United States Postal Service,whether or not guaranteed as to principal and interest by the United States.

(c) Stock or obligations of a national mortgageassociation or any successor or successors thereto, including the FederalNational Mortgage Association.

(d) Any bonds, general or revenue obligations or otherdebt obligations of any state of the United States or of any city, town,county, school district, improvement district, municipal corporation orquasi-municipal corporation of any state in the United States or otherpolitical subdivision of any such state.

(e) The bonds, debentures, securities or other similarobligations issued pursuant to:

(1) The Federal Farm Loan Act, as amended;

(2) The Farm Credit Act of 1933, as amended;

(3) The Federal Home Loan Bank Act of 1932, asamended;

(4) The Farm Credit Act of 1971, 12 U.S.C. 2001 to 2259, inclusive, as now or hereafter amended; and

(5) Any other federal act or authority, thebonds, debentures, securities or other similar obligations of which have beenapproved by the Commissioner for investment.

2. This section is cumulative to all other lawsrelating to the investment of bank funds.

(Added to NRS by 1971, 981; A 1971, 1184; 1973, 1092)

NRS 662.065 Investmentsin private securities; limitation.

1. As used in this section, private security means amarketable obligation in the form of a bond, note or debenture which iscommonly regarded as an investment security. It does not include investmentswhich are predominantly speculative in nature.

2. A bank may purchase a private security for its ownaccount when in its prudent banking judgment, which may be based in part uponestimates which it believes to be reliable, it determines that:

(a) There is adequate evidence that the obligor will beable to perform all that it undertakes to perform in connection with thesecurity, including all debt service requirements; and

(b) The security may be sold with reasonable promptnessat a price which corresponds reasonably to its fair value.

3. A bank may purchase a private security for its ownaccount, although its judgment with respect to the obligors ability to performis based predominantly upon estimates which it believes to be reliable.Although the appraisal of the prospects of any obligor will generally be basedin part upon estimates, it is the purpose of this subsection to permit a bankto exercise a broader range of judgment with respect to a more restrictedportion of its investment portfolio. This authority may be exercised not onlyin the absence of a record of performance, but also when there are prospectsfor improved performance.

4. A bank may, as a factor in reaching its prudentbanking judgment with respect to a private security, consider a rulingpublished by the Commissioner on the eligibility of the private security forpurchase. Consideration must be given to the possibility that circumstances onwhich the ruling was based may have changed since the time of the ruling.

5. Subject to the limitations set forth in NRS 662.155, the investment in any privatesecurities of any one obligor may at no time be more than 25 percent of thestockholders or members equity of the bank.

(Added to NRS by 1971, 982; A 1983, 1738; 1987, 1913;1997, 987)

NRS 662.075 Investmentsauthorized as security for deposits of public money.

1. Notwithstanding any restrictions or limitations onsecurities for deposits of public money contained in any law of this state, thebonds, debentures, securities or other similar obligations issued pursuant to:

(a) The Federal Farm Loan Act, as amended;

(b) The Farm Credit Act of 1933, as amended;

(c) The Federal Home Loan Bank Act of 1932, as amended;

(d) The Farm Credit Act of 1971, 12 U.S.C. 2001 to2259, inclusive, as now or hereafter amended; and

(e) Any other federal act or authority, the bonds,debentures, securities or other similar obligations of which have been approvedby the Commissioner for investment,

are, withoutlimitation, authorized securities for all deposits of public money for theState of Nevada, of agencies of the State of Nevada, of counties of the Stateof Nevada, and of municipalities and other political subdivisions of the Stateof Nevada.

2. This section is cumulative to all other lawsrelating to securities for deposits of public money.

(Added to NRS by 1971, 982; A 1973, 1093; 1983, 1738;1987, 1914)

NRS 662.085 Reservenot required against deposits secured by obligations of or guaranteed by UnitedStates; obligations as valid security.

1. A bank shall not be required to maintain a reserveagainst deposits secured by any obligations of the United States, its agenciesor any other obligations guaranteed by the United States Government or any ofits agencies equal in par value to the amount of such deposits.

2. Such obligations shall be valid security for allloans and deposits.

(Added to NRS by 1971, 983)

NRS 662.095 Investmentin obligations approved by Federal Housing Administrator, Department ofVeterans Affairs, national mortgage association or Federal Home Loan Bank;conditions for making loans; obligations as collateral, deposits or investmentof equity; exemption from certain laws.

1. To the same extent that a bank may invest its moneyin obligations of the United States, a bank may invest its money and may investthe money in its custody or possession which is eligible for investment:

(a) In bonds or notes secured by a mortgage or deed oftrust insured or guaranteed by the Federal Housing Administrator or theDepartment of Veterans Affairs;

(b) In mortgages on real property which have beenaccepted for insurance by the Federal Housing Administrator or Department ofVeterans Affairs; and

(c) In obligations of national mortgage associations orbonds, debentures, consolidated bonds or other obligations of any Federal HomeLoan Bank or Banks.

2. A bank may make such loans:

(a) Secured by real property, as the Federal HousingAdministrator or Department of Veterans Affairs has insured or has made acommitment to insure, and may obtain such insurance.

(b) As are insured or guaranteed by the Federal HousingAdministrator, and on being approved as eligible for credit insurance by theDepartment of Veterans Affairs, may make such loans as are insured orguaranteed by the Department of Veterans Affairs.

3. Wherever by statute of this state:

(a) Collateral is required as security for the depositof public money;

(b) Deposits are required to be made with any publicofficer or department; or

(c) An investment of stockholders or members equity,or a reserve or other fund is required to be maintained, consisting ofdesignated securities,

bonds andnotes secured by a mortgage or deed of trust insured by the Federal HousingAdministrator or Department of Veterans Affairs, debentures issued by theFederal Housing Administrator and obligations of national mortgage associationsare eligible for those purposes.

4. No law of this state prescribing the nature, amountor form of security or requiring security upon which loans or investments maybe made, prescribing or limiting the rates of time of payment of the interestany obligation may bear, or prescribing or limiting the period for which loansor investments may be made, applies to loans or investments made pursuant tothis section.

(Added to NRS by 1971, 983; A 1987, 1914; 1995, 1099;1997, 987)

NRS 662.097 Investmentsin securities of management investment trust or management investment company.

1. A bank which is acting as a fiduciary or agent may,in its discretion or at the direction of another person who is authorized todirect the investment of money held by the bank as a fiduciary or agent, investin the securities of a management investment trust or management investmentcompany if:

(a) The investment trust or investment company isregistered pursuant to the Investment Company Act of 1940, as amended, 15U.S.C. 80a-1 et seq.; and

(b) The portfolio of the investment trust or investmentcompany consists substantially of investments which are not prohibited by theinstrument creating the fiduciary or agency relationship.

2. A bank or an affiliate of the bank may provideservices to the investment trust or investment company, including, withoutlimitation, acting as an investment adviser, custodian, transfer agent,registrar, sponsor, distributor or manager and may receive reasonablecompensation for the services. The manner in which the compensation iscalculated must be disclosed to the person who is currently receiving thebenefits of the fiduciary or agency relationship with the bank. The disclosuremay be made by a prospectus, a statement of account or otherwise.

3. A bank may deposit money held by the bank as afiduciary or agent with an affiliate before investing or making otherdisposition of the money.

(Added to NRS by 1991, 822)

NRS 662.099 Investmentin development corporation, corporation for economic revitalization anddiversification, corporation for community development or similar corporation. A state bank may purchase for its own account the stockand other securities of:

1. A development corporation organized under theprovisions of chapter 670 of NRS;

2. A corporation for economic revitalization anddiversification organized under the provisions of chapter670A of NRS, if the bank is a member of the corporation, and to the extentof its loan limit established under NRS670A.200, on the same terms and under the same conditions as a nationalbank may purchase them; and

3. Subject to any conditions imposed by thecommissioner, a development corporation, a corporation for economicrevitalization and diversification, a corporation for community development, ora similar corporation organized in another state if the Commissioner determinesthat the laws pursuant to which the corporation is organized are substantiallysimilar to the provisions of chapter 670 or 670A of NRS.

(Added to NRS by 1975, 1827; A 1979, 583; 1983, 1279;1997, 988)

NRS 662.101 Investmentsin loans to finance interests in cooperative housing corporations.

1. A bank may make or invest in a loan to finance aborrowers interest in or to refinance his existing interest in a cooperativehousing corporation if the loan is secured by:

(a) A first security interest in stock or a certificateof membership in the cooperative housing corporation; and

(b) An assignment of or lien on the borrowers interestin the lease or other right of tenancy to a dwelling unit of the cooperativehousing corporation.

2. For purposes of this chapter, the interest in acooperative housing corporation which is encumbered by a security interestshall be deemed to be real property, and any loan made pursuant to subsection 1shall be deemed to be a loan secured by a mortgage on real property.

3. As used in subsection 1, cooperative housingcorporation means a corporation organized under the laws of this state for thepurpose of the cooperative ownership of real estate whereby each of the stockholdersor members is entitled, through ownership of stock or a certificate ofmembership in the corporation, to occupy a house, apartment or other dwellingunit on real estate owned by the corporation.

(Added to NRS by 1979, 709)

NRS 662.103 Investmentin real property for development: Limitations; filing of disclosure withCommissioner; failure to make disclosure unlawful.

1. A bank may invest in real property for development,directly or through partnerships, joint ventures or other indirect methods. Anysuch investment must not exceed the market value or appraisal of the propertyas evidenced by a report prepared within 120 days before the investment by amember of a society approved collectively by the Commissioner or by anotherappraiser approved individually by the Commissioner. Approval must be based onthe independence, experience and training required of or possessed by theappraiser.

2. Within 30 days after such an investment is made,the bank must file with the Commissioner:

(a) A certified copy of at least one report of theappraisal of the real property in which the investment is made; and

(b) The report of a title insurance company whichcontains the transfers of title which occurred during a period of at least 3years immediately preceding the investment and the amount of consideration, ifavailable, given for each transfer.

3. A bank may not invest in real property for development,exclusive of investments allowed under paragraphs (a) and (b) of subsection 2of NRS 662.015 and of real propertyacquired through the collection of debts due to the bank, an amount whichexceeds its stockholders or members equity or 10 percent of its assets,whichever is less. The Commissioner may require a statement from the bankdisclosing whether any director, officer or employee of the bank has a director indirect interest in the real property involved or has had any such interestat any time during the preceding 3 years. Ownership of stock in a corporationwhich has an interest is an interest in the property of the stockholder.Failure to make a required disclosure is unlawful.

(Added to NRS by 1985, 1050; A 1987, 1915; 1997, 988)

NRS 662.105 Stockoptions and purchases for directors, officers and employees. Subject to any applicable regulations of the Commissioner,a banking corporation may grant options to purchase, sell or enter intoagreements to sell shares of its capital stock to its directors, officers oremployees, or any of them, for a consideration of not less than 100 percent ofthe fair market value of the shares on the date the option is granted, or, ifpursuant to a stock purchase plan, 85 percent of the fair market value of theshares on the date the purchase price is fixed, pursuant to the terms of a planfor the purchase of stock by officers and employees which has been adopted bythe board of directors of the bank and approved by a majority of the holders ofthe particular class or classes of stock that are included in the plan and bythe Commissioner. In no event may the option to purchase such shares be for aconsideration less than the par value thereof.

(Added to NRS by 1971, 983; A 1983, 1739; 1985, 739;1987, 1916; 1995, 485; 1997, 989)

NRS 662.115 Issuanceof capital notes, debentures and collateralized debt securities andcertificates. A bank may issue capital notes,collateralized debt securities, collateralized debt certificates, ordebentures, convertible or otherwise, subject to such regulations as theCommissioner may adopt with respect thereto.

(Added to NRS by 1971, 984; A 1983, 1739; 1987, 1916;1997, 989)

NRS 662.125 Limitationson lending on security of or acquisition of own stock or members interests;sale and ownership of collateral security.

1. Except as otherwise provided in subsection 2, nobank may make any loan or discount on the security of its own stock or membersinterests, nor be the purchaser or holder of any such shares or interests,unless the loan, discount, purchase or holding has been approved by theCommissioner or is necessary to prevent loss upon a debt previously contractedin good faith.

2. A bank may make a loan or discount on the securityof its own stock or members interests as it deems appropriate if the bank issubject to the reporting requirements set forth in section 12, 13, 14 or 15(d)of the Securities Exchange Act of 1934, as amended, 15 U.S.C 78l, 78m, 78nand 78o(d), respectively, or 12 C.F.R. 335.

3. Stock or interests purchased or acquired to preventloss upon a debt previously contracted in good faith must, within 2 years afterthey are purchased, be sold or disposed of at a public or private sale, unlessthe Commissioner authorizes the bank to hold the stock or interests for a longerperiod. After the expiration of 2 years or the period authorized by theCommissioner, any such stock or interests not sold or disposed of pursuant tothis subsection must, except upon the approval of the Commissioner, be chargedto profit and loss and must not be considered as part of the assets of thebank.

4. Any bank may sell or become the owner of anyproperty which may come into its possession as collateral security for any debtor obligation due it, according to the terms of any contract depositing thecollateral security. If there is no contract, the collateral security may besold in the manner provided by law. Any property the bank has in its possessionpursuant to this subsection, other than real property, must be sold within 2years after it is acquired, unless the Commissioner authorizes the bank to holdthe property for a longer period.

(Added to NRS by 1971, 984; A 1995, 485; 1997, 989)

NRS 662.135 Limitationson investment in stock of or membership in other banks and businessorganizations.

1. Except as otherwise provided in this section andsubject to the provisions of NRS 662.065and 662.125, no bank may make anyinvestment in the stock or become a member of any other state or national bank.

2. A bank doing business under this title maysubscribe to or purchase, upon such terms as may be agreed upon, the stock ofbanks organized under the Act of Congress known as the Edge Act or the stock ofcentral reserve banks whose stock exceeds $1,000,000.

3. To constitute a central reserve bank ascontemplated by this title, at least 50 percent of the capital stock of thebank must be owned by other banks. The investment by any bank in the capitalstock of a central reserve bank or a bank organized under the Edge Act, must atno time exceed 10 percent of the stockholders or members equity of the bankmaking the investment.

4. A bank shall not invest in the stocks or ownershipof other corporations, firms, partnerships or companies except as otherwiseprovided in this title, unless the investment is made to protect the bank fromloss.

5. A bank may invest in the stocks or ownership ofother corporations, firms, partnerships or companies as part of a merger,consolidation, combination or acquisition that is authorized pursuant to theprovisions of chapter 78, 86 or 92A ofNRS, regardless of whether the investment is made to protect the bank fromloss.

6. Any stocks or ownership owned or acquired afterJuly 1, 1971, in excess of the limitations imposed by this section must bedisposed of at public or private sale within 12 months after the date ofacquiring them, and if not so disposed of, they must be charged to profit andloss account, and no longer carried on the books as an asset. The limit of timein which such stocks or ownership is disposed of or charged off the books ofthe bank may be extended by the Commissioner if in his judgment it is for the bestinterest of the bank that an extension be granted.

7. A bank may subscribe to, purchase or become theowner of stock in:

(a) Federal reserve banks as established by Act ofCongress approved December 23, 1913, being c. 6, 38 Stat. 251, or any amendmentthereof; or

(b) Any governmental agency, Federal Home Loan Bank orliquidating or financial corporation created by the Congress of the UnitedStates.

8. A bank may invest up to 50 percent of its surplusin the stock or membership of corporations or limited-liability companiesengaged in related banking fields.

(Added to NRS by 1971, 984; A 1983, 1739; 1987, 1916;1995, 486; 1997, 990)

NRS 662.145 Limitson amount of loans; exceptions.

1. Subject to the limitations set forth in NRS 662.155, the total outstanding loans ofany bank to any person, company, corporation or firm may not at any time exceed25 percent of the stockholders or members equity of the bank, actually paidin. The discount of bills of exchange drawn in good faith against actualexisting values, as collateral security, and a discount or purchase ofcommercial or business paper, actually owned by the persons, must not beconsidered as money loaned.

2. Neither the limitation on loans by banks containedin this section nor any other similar limitations contained in any law of thisstate relating to banks or banking apply to any loan or loans made by any bankto the extent that they are secured or covered by guarantees or by commitmentsor agreements to take over or to purchase made by any Federal Reserve Bank orby the United States or any department, bureau, board, commission orestablishment of the United States, including any corporation wholly owned,directly or indirectly, by the United States.

3. The Commissioner may establish limitations on loansmade by a bank to its directors, officers or employees and may establishrequirements for the reporting of these loans.

4. The Commissioner may adopt regulations necessary tocarry out the provisions of this section.

(Added to NRS by 1971, 985; A 1981, 766; 1983, 1740;1987, 1917; 1991, 373; 1997, 991)

NRS 662.155 Limiton combination of investments and loans involving single obligor, person orentity.

1. The combination of investments in private securitiesprovided for in subsection 5 of NRS 662.065and outstanding loans provided for in subsection 1 of NRS 662.145, of any bank to any oneobligor, person, company, corporation or firm, including any unincorporatedcompany or firm and the members thereof, must not at any time exceed 25 percentof the stockholders or members equity of the bank.

2. The Commissioner may adopt regulations necessary tocarry out the provisions of this section.

(Added to NRS by 1971, 985; A 1991, 373; 1997, 991)

NRS 662.175 Limitationson borrowing money and pledging assets; exceptions; purchase of federal reservemoney deemed transfer.

1. Any bank may secure money deposited with a bank bythe United States, the State of Nevada or a political subdivision of this stateby pledging acceptable assets of the bank as collateral security.

2. Any bank may borrow money for temporary purposes, notto exceed the amount of its stockholders or members equity, and may pledgeany of its assets as collateral security therefor.

3. With the written consent of the Commissioner, abank may borrow an amount that is not more than 200 percent in excess of itsstockholders or members equity, and pledge assets of the bank as collateralsecurity for the amount borrowed. Any indebtedness contracted in excess of theamount limited in this subsection is void in its entirety.

4. A bank may borrow money from the Federal Home LoanBank. Money borrowed pursuant to this subsection shall not be deemed borrowedmoney for the purposes of the limitations prescribed in subsections 2 and 3. Abank may pledge any of its assets as collateral security for money borrowed pursuantto this subsection.

5. The purchase of federal reserve money by a bankfrom another bank shall be deemed a transfer from a sellers account in aFederal Reserve Bank to the buyers account in that bank, and the transfershall be considered a purchase and sale of federal reserve money. Such atransfer does not create an obligation on the part of the buyer subject to NRS 662.145, or a borrowing subject to thelimitations of this section, but shall be considered a purchase and sale offederal reserve money.

(Added to NRS by 1971, 985; A 1983, 1741; 1987, 1917;1997, 992)

NRS 662.186 Operatingcash: Minimum cash and demand balances; reserves.

1. Each bank doing business under the laws of thisstate shall have on hand, in cash, at least the sum of money determined by theCommissioner as necessary to meet the operating requirements of the bank and atleast a required sum consisting of demand balances due from good and solventbanks.

2. Any bank organized under the laws of this stateshall carry or maintain as a reserve at least that amount of money which isrequired under the terms of the Federal Reserve Act.

(Added to NRS by 1971, 986; A 1983, 295, 1741; 1985,739; 1987, 1918)

NRS 662.205 Membershipin Federal Reserve Bank: Authorization; powers, duties and examination ofmember.

1. As used in this section:

(a) Board of Governors of the Federal Reserve Systemmeans the Board of Governors of the Federal Reserve System created anddescribed in the Federal Reserve Act.

(b) Federal Reserve Act means the Act of Congress,approved December 23, 1913, being c. 6, 38 Stat. 251, as amended.

(c) Federal Reserve Bank means the Federal ReserveBanks created and organized under authority of the Federal Reserve Act.

(d) Member bank means any national bank, state bankor banking and trust company which has become or which becomes a member of oneof the Federal Reserve Banks created by the Federal Reserve Act.

2. Any bank organized under the laws of this state maysubscribe to the stock and become a member of a Federal Reserve Bank.

3. Any bank organized under the laws of this statewhich is, or which becomes, a member of a Federal Reserve Bank is, by thissection, vested with all powers conferred upon member banks of the FederalReserve Banks by the terms of the Federal Reserve Act as fully and completelyas if such powers were specifically enumerated and described in this section,and all such powers must be exercised subject to all restrictions andlimitations imposed by the Federal Reserve Act, or by regulations of the Boardof Governors of the Federal Reserve System made pursuant thereto. The right,however, is expressly reserved to revoke or to amend the powers conferred inthis section.

4. A compliance on the part of any such bank with thereserve requirements of the Federal Reserve Act shall be deemed to be a fullcompliance with those provisions of the laws of this state which require banksto maintain cash balances in their vaults or with other banks, and no such bankneed carry or maintain a reserve other than such as is required under the termsof the Federal Reserve Act.

5. Any such bank continues to be subject to thesupervision and examinations required by the laws of this state, except thatthe Board of Governors of the Federal Reserve System may, if it deemsnecessary, make examinations. The authorities of this state having supervisionover such bank may disclose to the Board of Governors of the Federal ReserveSystem, or to examiners appointed by it, all information in reference to theaffairs of any bank which has become, or desires to become, a member of aFederal Reserve Bank.

(Added to NRS by 1971, 987; A 1995, 486; 1997, 992)

SAVINGS BANK BUSINESS

NRS 662.215 Authorization;deposits; requirements of receipt or passbook; quarterly or annual statementsrequired; issuance of time certificates.

1. Any bank organized under the provisions of thistitle may carry on a savings business as prescribed in this title.

2. Any bank conducting a savings business may receivedeposits on such terms as are authorized by its board of directors.

3. A receipt or a passbook must be issued to eachdepositor in a bank for all money deposited on open account.

4. The rules and regulations adopted by the bankgoverning deposits must be:

(a) Included in the receipt or passbook issued pursuantto subsection 3;

(b) Printed and conspicuously posted in a placeaccessible and visible to all persons in the business office of the bank; or

(c) Provided directly to the depositor.

5. Payments from the account to the depositor must bemade only if the depositor authorizes the payments. Banks issuing savingsdeposit receipts for accounts other than certificates of deposit or passbookaccounts shall, not less often than:

(a) Quarterly, for accounts having a balance of $100 ormore; or

(b) Annually, for accounts having a balance of lessthan $100,

deliver ormail to the depositor a statement, showing the balance on deposit in theaccount and each deposit made by and each payment made to the depositor duringthe calendar quarter.

6. This title does not prohibit a bank from issuingtime certificates of deposit.

(Added to NRS by 1971, 988; A 1981, 846; 1997, 993)

PAYMENTS IN EXCHANGE

NRS 662.225 Checkspayable in exchange. In order to preventaccumulation of unnecessary amounts of currency in the vaults of the bankschartered by this state, all checks drawn on such banks shall be payable,unless specified on the face thereof to the contrary by the maker or makers ofthe checks at the option of the drawee bank, in exchange drawn on the reservedeposits of such drawee bank when any such check is presented by or through anyfederal reserve bank, post office or express company, or any respective agentsthereof.

(Added to NRS by 1971, 988)

TRUST COMPANY BUSINESS

NRS 662.231 Businessof a trust company and trust company business defined. As used in NRS 662.231to 662.245, inclusive, business of atrust company or trust company business has the meaning ascribed to it in NRS 669.029.

(Added to NRS by 1999, 840)

NRS 662.235 Powersand duties when carrying on trust company business; segregation of assets andrecordkeeping.

1. Any bank organized under this title may state inits articles of incorporation that it will carry on a trust company business inconnection with the banking business, and in addition to the powers conferredupon banks may:

(a) Act as trustee under any mortgage or bond of anyperson, firm or corporation, or of any municipality or body politic.

(b) Accept and execute any municipal, corporate orindividual trust not inconsistent with the laws of this State.

(c) Act under the order or appointment of any court asguardian, commissioner, receiver or trustee.

(d) Act as executor or trustee under any will.

(e) Act as fiscal or transfer agent of any state,municipality, body politic or corporation, and in a capacity to receive anddisburse money and register, transfer and countersign certificates of stock,bonds and other evidences of indebtedness.

(f) Act as local or resident agent of foreigncorporations.

2. Any such bank holding any asset as a fiduciaryshall:

(a) Segregate all such assets from any other assets ofthe bank and from the assets of any other trust, except as may be expresslyprovided otherwise by law or by the writing creating the trust.

(b) Record such assets in a separate set of booksmaintained for fiduciary activities.

(Added to NRS by 1971, 988; A 1987, 1918; 1993, 2280)

NRS 662.239 Conditionsand limitations on maintaining trust offices in Nevada and other states;regulations.

1. A bank organized under this title may maintaintrust offices in this or other states with the written consent of theCommissioner.

2. Any action taken by the Commissioner pursuant tosubsection 1 is subject to review in the manner provided in NRS 659.055.

3. The Commissioner may adopt regulations establishingreasonable conditions and requirements for the approval and maintenance oftrust offices.

4. As used in this section, trust office means anoffice, other than the principal office, at which a bank organized under thistitle is authorized by the Commissioner to conduct the business of a trustcompany.

(Added to NRS by 1999, 840)

NRS 662.245 Conditionsand limitations on certain foreign organizations acting as fiduciary; fees;bond; requirements for service of process; regulations.

1. An organization that does not maintain an office inthis State to conduct the business of a trust company may be appointed to actas fiduciary by any court or by authority of any law of this State if, in additionto any other requirements of law, the organization:

(a) Associates as cofiduciary a bank authorized to dobusiness in this State or a trust company licensed pursuant to chapter 669 of NRS; or

(b) Is a trust corporation or trust company which:

(1) Is organized under the laws of and has itsprincipal place of business in another state which allows trust corporations ortrust companies licensed pursuant to chapter 669of NRS to act as fiduciary in that state;

(2) Is authorized by its charter to act asfiduciary; and

(3) Before the appointment as fiduciary, fileswith the Secretary of State a document, acknowledged before a notarial officer,which:

(I) Appoints the Secretary of State as itsagent upon whom all process in any action or proceeding against it may beserved;

(II) Contains its agreement that theappointment continues in force as long as any liability remains outstandingagainst it in this State, and that any process against it which is served onthe Secretary of State is of the same legal validity as if served on itpersonally;

(III) Contains an address to which theSecretary of State may mail the process when received; and

(IV) Is accompanied by a fee of not morethan $20.

A copy ofthe document required by this subparagraph, certified by the Secretary ofState, is sufficient evidence of the appointment and agreement.

2. A court which has jurisdiction over the accounts ofa fiduciary that is a trust corporation or trust company described in paragraph(b) of subsection 1 may require the fiduciary to provide a bond to ensure theperformance of its duties as fiduciary, in the same manner and to the same extentas the court may require such a bond from a fiduciary that is a bank or trustcompany described in paragraph (a) of subsection 1.

3. Service of process authorized by subparagraph (3)of paragraph (b) of subsection 1 must be made by filing with the Secretary ofState:

(a) Two copies of the legal process. The copies mustinclude a specific citation to the provisions of this section. The Secretary ofState may refuse to accept such service if the proper citation is not includedin each copy.

(b) A fee of not more than $20.

TheSecretary of State shall forthwith forward one copy of the legal process to theorganization, by registered or certified mail prepaid to the address providedin the document filed pursuant to subparagraph (3) of paragraph (b) ofsubsection 1.

4. The Commissioner shall adopt regulationsestablishing the amount of the fees required pursuant to this section.

5. As used in this section:

(a) Fiduciary means an executor, commissioner,guardian of minors or estates, receiver, depositary or trustee.

(b) Notarial officer has the meaning ascribed to itin NRS 240.005.

(c) State means any state or territory of the UnitedStates or the District of Columbia.

(Added to NRS by 1971, 989; A 1979, 692; 1987, 1918;1993, 1465; 1995, 487, 1551; 1997, 476; 1999, 840; 2005, 1844)

CLOSING OF BANKS

NRS 662.255 Voluntaryclosure on Saturdays, Sundays and holidays; transaction of business.

1. A bank may elect to close on Saturdays, Sundays orlegal holidays. Except as otherwise provided in subsection 2 and NRS 104.4303, if a bank elects not toclose on a Saturday, Sunday or legal holiday, all business transacted on aSaturday, Sunday or legal holiday shall be deemed to have been transacted onthe next banking day that is not a Saturday, Sunday or legal holiday.

2. If a bank elects not to close on a Saturday, Sundayor legal holiday which falls on the last day of a calendar year, that day shallbe deemed a regular banking day for the purposes of transacting business.

3. As used in this section, the term legal holidayincludes all days which are declared by NRS236.015 to be legal holidays.

(Added to NRS by 1971, 989; A 1985, 984; 1987, 1919;1997, 3515; 1999,2412)

NRS 662.265 Emergencyclosure: Definitions. As used in NRS 662.275 to 662.305, inclusive, unless the contextotherwise requires:

1. Bank includes national banks to the extent that NRS 662.275 to 662.305, inclusive, do not conflict with orinfringe upon federal law.

2. Emergency means any condition or occurrence whichmay interfere physically with the conduct of normal business operations at oneor more or all of the offices of a bank, or which poses an imminent or existingthreat to the safety or security of persons or property, or both. Withoutlimiting the generality of the foregoing, an emergency may arise as a result ofany one or more of the following: Fire, flood, earthquake, hurricanes, wind,rain or snowstorms, labor disputes and strikes, power failures, transportationfailures, interruption of communication facilities, shortages of fuel, housing,food, transportation or labor, robbery or attempted robbery, actual orthreatened enemy attack, epidemics or other catastrophes, riots, civilcommotions and other acts of lawlessness or violence, actual or threatened.

3. Office means any place at which a bank transactsits business or conducts operations related to its business.

4. Officers means the person or persons designatedby the board of directors, the managers or other governing body of a bank, toact for the bank in carrying out the provisions of NRS 662.275 to 662.305, inclusive, or in the absence ofany such designation or the absence of the officer or officers so designated,the president, a manager or any other officer currently in charge of the bankor of the office or offices in question.

(Added to NRS by 1971, 989; A 1995, 488)

NRS 662.275 Emergencyclosure: Powers of Commissioner.

1. Whenever the Commissioner is of the opinion that anemergency exists, or that there is a reasonable probability that an emergencymay develop, in this state or any part of this state, the Commissioner may, byproclamation, authorize banks located in the affected area or areas to closeany or all of their offices.

2. In addition, if the Commissioner is of the opinionthat an emergency exists, or that there is a reasonable probability that anemergency may develop, which affects or may affect a particular bank or banks,or a particular office or offices thereof, but not banks located in the areagenerally, he may authorize the particular bank or banks, or office or officesso affected, to close.

3. The office or offices so closed must remain closeduntil the Commissioner proclaims that the emergency has ended, or until suchearlier time as the officers of the bank determine that one or more of suchoffices should reopen. In either event, the bank or office which was closed mayremain closed for such further time thereafter as may reasonably be required toreopen.

(Added to NRS by 1971, 989; A 1983, 1741; 1987, 1919)

NRS 662.285 Emergencyclosure: Powers of banks officers.

1. Whenever the officers of a bank are of the opinionthat an emergency exists, or that there is a reasonable probability that anemergency may develop, which affects or may affect one or more or all of abanks offices, they shall have the authority in the reasonable and properexercise of their discretion not to open any one or more or all of such officesduring the continuation of such emergency, even if the Commissioner has notissued and does not issue a proclamation of emergency.

2. The office or offices so closed must remain closeduntil such time as the officers determine that the emergency has ended, and forsuch further time thereafter as may reasonably be required to reopen; but suchoffice or offices must not remain closed for more than 48 consecutive hours,excluding other legal holidays, without requesting the approval of theCommissioner.

3. The officers of a bank may close any one or more orall of the banks offices on any day or days designated, by proclamation of thePresident of the United States or the Governor of this state, as a day or daysof mourning, rejoicing or other special observance.

(Added to NRS by 1971, 990; A 1983, 1742; 1987, 1919)

NRS 662.295 Emergencyclosure: Notification of Commissioner or Comptroller of the Currency. A bank closing an office or offices pursuant to subsection1 of NRS 662.285 shall give as promptnotice of its action as conditions will permit, by any means available, to theCommissioner, or in the case of a national bank, to the Comptroller of theCurrency.

(Added to NRS by 1971, 990; A 1983, 1742; 1987, 1920)

NRS 662.305 Emergencyclosure: Effect of closing.

1. Any day on which a bank, or any one or more of itsoffices, is closed during all or any part of its normal banking hours pursuantto the authorization granted under NRS662.265 to 662.305, inclusive, shallbe, with respect to such bank or, if not all of its offices are closed, thenwith respect to any office or offices which are closed, a legal holiday for allpurposes with respect to any banking business of any character. No liability orloss of rights of any kind on the part of any bank, or director, officer oremployee thereof, shall accrue or result by virtue of any such closing.

2. NRS 662.265to 662.305, inclusive, are in additionto, and not in substitution for or limitation of, any other law of this stateor of the United States, authorizing the closing of a bank or excusing thedelay of a bank in the performance of its duties and obligations because ofemergencies or conditions beyond the banks control, or otherwise.

(Added to NRS by 1971, 990)

 

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