j:4R3 , ^■3/( The Banking Laws of Illinois Compiled by W. H. Kniffin, Jr. Compliments of the Drovers Deposit National Bank Chicago UC-NRLF B 3 12D 777 GIFT OF ^^^m>^ji^ ®aJpe,<i,Jc oyV^Wv^ v>uc:^.o.^t> Digitized by the Internet Archive in 2008 with funding from IVIicrosoft Corporation http://www.archive.org/details/bankinglawsofillOOillirich COMPLIMENTS OF United States Depositary CAPITAL and SURPLUS $1,000,000.00 Quick Service and careful attention given to all business entrusted to us Accounts of Banks and Bankers Merchants, Corporations and Individuals invited Ajcts as Reserve Agent for National Banks The Banking Laws of Illinois Compiled by W. H. KNIFFIN, Jr. Copyright, 1911, Bankers Publishing Co., N, T. '"r^^j^^ Statement of Condition June 7, 1911 RESOURCES Loans and Discounts - - $5,627,329.36 Overdrafts - - . . 1,741.39 United States and other aondi 743,348.56 Cash and due from Banks ' - 3,764,815.76 ' ' ' $10,137,235.07 $600,000.00 443,233.07 441,600.00 2,935.24 8,649,466.76 $10,137,235.07 LIABlLIllES Capital Stock paid in - - Surplus and Profits Nat'l Bank Notes Outstanding Reserved for Taxes Deposits ----- Banking Laws of Illinois STATE BANKS ORGAN IZA- ^^ *^^ ratification of this Act TiON AND by a vote of the people in EC- management ^oj.dance with the Constitution of this State^ (the Act was ratified as herewith given), it shall be lawful to form banks and banking associations, as hereinafter provided, for the purpose of discount and deposit, buying and selling exchange and doing POWERS a general banking business, ex- cepting the issuing of bills to circulate as money, and such banks or banking associations shall have the power to loan money on personal and real estate security and to ac- cept and execute trusts. (Section 1.) 247114 When any association of persons APPLICATION desire to avail themselves of the AUDITOR, provisions of this Act they may organTze^ ^Pply to the Auditor for per- mission to organize, stating their place of business, the amount of capital and name under which they desire to organize and the time for which such association shall continue, which statement shall be under their hands and seals, and acknowledged before some officer authorized by law to acknowledge deeds; and the Auditor shall issue them a permit to organize. But no permit shall be issued to more than one association of the same name; and all persons or associations formed under this Act shall have their capital stock divided into shares of one hundred dollars each. (Section 2.) SUBSCRIP- ^^ ^^^^ ^^ ™^y ^ after receipt TION TO of authorization, books of sub- STOCK ELECTION OF scription to the capital stock vcmNG^'^^' ™^y ^^ opened, and when the capital stock shall have been fully subscribed for, a meeting of the sub- scribers to the capital stock of such associa- tion shall be called (each subscriber having had at least three da^'s' notice) for determination of the number and election of directors to serve as managers for one year and until their suc- cessors are elected. And no director shall be elected unless he shall have received votes rep- resenting at least a majority of the shares of the association; and the voting may be done by person or by proxy, and at such election each subscriber or stockholder shall have the right to vote for the number of shares owned or subscribed by him for as many persons as there are directors to be elected, or to cumulate such shares and give one candidate as many votes as the number of directors multiplied by the number of his shares of stock shall equal or to distribute them on the same principle among as many candidates as he shall deem proper. (Section 3.) The directors so elected may OF OFFICERS Proceed to organize by the elec- tion of one of their number as president and may appoint the necessary offi- cers and employees and fix their salaries to carry on the business of the bank or associa- tion and make by-laws (not inconsistent with this Act) for the government of the bank or association; and each director shall take and BY-LAWS subscribe to an oath such as the OATH OF Auditor shall prescribe, of fealty to the bank or association of which he is director, and that he will, so far as the duty devolves on him, diligently and hon- estly administer the aflfairs of such bank or association, and will not knowingly violate or willingly permit to be violated any of the pro- visions of this Act; and that he is the owner in good faith, and in his own right of the num- ber of shares of stock required by this Act; and that same is not hypothecated or in any way pledged as security for any loan or debt. Such oath subscribed by the director making it and certified by a proper officer authorized to administer oaths, shall be immediately trans- mitted to the Auditor, and shall be filed and preserved by him in his office. The directors 8 shall cause to be kept suitable books of record of all the transactions of the bank or associa- tion, and shall furnish to the Auditor lists of the stockholders and copies of any other records the Auditor may require. And there shall be an annual meeting of the stockholders for the election of directors each year on the first Monday in January, unless some other date shall be fixed by the by-laws of the association. Any omission to elect directors shall not impair any of the rights and privileges of the associa- tion or of any person in any way interested, but the existing directors shall hold office until their successors are elected and qualified, as in such cases may be by by-laws provided. Vacan- cies may be filled by a two-thirds vote of the remaining directors. Every director of any bank or TiONS FOR association organized under the ME^^iN^S^' provisions of this Act must own in his own right, free of any lien or incumbrance, at least ten shares of the capital stock of such bank or association of which he is a director. Any director who ceases 9 to be the owner of ten shares of the capital stock of such bank or association, or who be- comes in any form disqualified, shall therefor vacate his place as such director. The direc- tors of any bank or association organized under the provisions of this Act shall hold regular meetings at least once each month and there shall be present a quorum, as may be prescribed by the by-laws of such bank or association, ap- proved by the Auditor of Public Accounts. Any officer, director or em- STATEMENTS ployce of any bank or associa- tion organized under the pro- visions of this Act and who shall wilfully and knowingly subscribe to or make, or cause to be made, any false statement with intent to de- ceive any person or persons authorized to ex- amine into the affairs of such bank or associa- tion, upon conviction thereof, shall be punished by imprisonment of not less than one year or more than ten years. (Section 4.) When the directors have organ- EXAMINATION . , . u- r r i.1,- BY AUDITOR izcd, as m section tour or this opetTinc? ^^^' ^^^ *^^ capital stock of such association shall have been aU fully paid in and record of the same laid be- 10 fore the Auditor, he shall by himself, or some competent person of his appointment, make a thorough examination into the affairs of such association and if satisfied the authorized cap- ital has been paid in and that the association has the full amount dedicated to the business, including proposed surplus, if any, and when they pay into the Auditor's office the reasonable expenses of such examination, he shall give ^gP^lPj^^^g them a written or printed cer- OF AUTHOR- tificate, under seal, authorizing '^^ '^ them to commence the business designated in section one of this Act. And said certificate and the permit issued in accordance therewith, duly certified by said Auditor, shall be filed and recorded in the office for the re- cording of deeds in the county where such bank is organized, and the original or a certified copy thereof shall be evidence in all courts of the existence and authority or said corporation to do business. Upon the recording of said certificate and permit said bank shall be deemed fully organized and may proceed to business. The Auditor may in his discretion, withhold 11 the issuing of the said certificate authorizing the commencement of business when he is not satisfied as to the personal character and stand- ing of the officers or directors elected or ap- pointed in accordance with sections three and four of this Act; or when he has reason to be- lieve that the bank is organized for any pur- pose other than that contemplated by this Act. (Section 5.) Every stockholder in anv bank ERS' or banking association organized list'o'f^' under the provisions of this Act STOCKHOLD- shall be individually responsible PILED and liable to its creditors over and above the amount of stock by him or her held to an amount equal to his or her respective shares so held for all its lia- bilities accruing while he or she remains such stockholder. It is hereby made the duty of the president and cashier, within thirty days after organization, to file in the office of the recorder of deeds of the county in which said bank is located, a certified list of all the orig- inal stockholders, giving the number of shares 12 of stock held by each, and thereafter a certifi- cate of all transfers of stock, not later than ten days after such transfer. No transfer of stock shall operate as a release of liability pro- vided in this section. (Section 6.) REPORTS ^^^ ^^^ ^^^ persons and asso- AND ciations organizing under the SUPERVISION p,„^i3i<,„, %i this Act shall make to the Auditor a report according to the form which may be prescribed by him, verified by oath or affirmation of the president or cash- ier of such association, which report shall j^gpQPyg ^Q exhibit in detail and under ap- AUDITOR propriate heads the resources ^hrIe^^^'^^ and liabilities of such bank or PENALTY association before the commence- ment of business on the morn- ing of any day he may choose; and he shall call for such reports at least once every three months of each year and the officers of said banks shall transmit the same to the Auditor within five days after receiving call for the same; and any bank failing to make and trans- mit such report, or to comply with any pro- 13 visions of this Act, shall be subject to a penalty of one-hundred dollars for each day after five days that such report is delayed beyond that time. And he shall cause such report to be published at the expense of such bank in some newspaper published in the city or town where such bank is located; or if no newspaper is pub- lished in such town, then in the nearest news- paper to such town. Every such quarterly re- port shall be accompanied with a fee of five dollars to defray the expense of examining the same and preparing it for publication. (Sec- tion 7.) YEARLY "^^^ Auditor as often as he shall EXAM IN A- deem necessary or proper, and at least once in each year, shall appoint a suitable person or persons to make an examination of the affairs of every bank estab- lished under the provisions of this Act, which person shall not be a stockholder or officer or employee of any bank which he may be di- rected to examine, and who shall have power to make a thorough examination into all the af- fairs of the bank, and in so doing to examine 14 any of the officers or agents or employees thereof on oath, and shall make a full and de- tailed report of the condition of the bank to the Auditor; and the bank shall not be subject to any other visitorial power than such as may be authorized by this Act, except such as are vested in the several courts of law and chan- COMPENSA- ^^^y- ^^ ^^^^y person ap- TiON OF pointed to make such examina- EXAMINERS f. i „ • r ■,. tion shall receive for his ser- vices at the rate of ten dollars for each day by him employed in such examination, and two dollars for each twenty-five miles he shall nec- essarily travel in the performance of his duty, which shall be paid to them by the bank examined. (Section 8.) Associations organized under this ESTATE, Act shall be bodies corporate LIMITATIONS ^"^ politic for the period for which they may be organized, may sue and be sued, may have a common seal which they may alter or renew at pleasure, may own, possess and may carry as assets the real estate necessary in which to do a banking busi- 15 ness, and siich other real estate to which they may obtain title in the collection of debts, but shall not carry in the assets any real estate except the banking house for a period of more than five years after acquiring title to same. (Section 9.) . *N » ^.* The total liabilities to any asso- LOANS, • i.- r £ LIMITATIONS sociation 01 any person or of RESTRICTIONS ^^^ corporation or firm for money borrowed including in the liabilities of a company or firm the liabilities of the several members thereof, shall at no time exceed fifteen per cent, of OF LOANS the amount of the capital stock of such association actually paid in and unimpaired and fifteen per cent, of its unimpaired surplus fund. Provided, however, that the total liabilities of any such person, company or firm shall at no time exceed thirty per cent, of the amount of capital actually paid in: And, provided, fur- ther, that undivided profits shall not be con- strued as a part of the surplus ; but the discount of bills of exchange drawn in good faith 16 against actually existing values, and the dis- count of commercial or business paper actually owned by the person negotiating the same, shall not be considered as money borrowed. VIOLATIONS Every such loan made in viola- REMEDIES, ' tion of the provisions hereof LIABILITIES gjj^jj y^^ ^^^ ^^^ payable ac- cording to its terms, and the remedy for the recovery of any money loaned in violation of the provisions hereof, or for the enforcement of any agreement, collateral or otherwise, made in connection with any such loan, shall not be held to be impaired, affected or prohibited by reason of such violation, but such remedy shall exist notwithstanding the same. But every director of any such association who shall vio- late, or participate in, or assent to such viola- tion, or who shall permit any of the officers, agents or servants of the association to violate the provisions hereof, shall be held liable in his personal and individual capacity for all dam- ages which the association, its stockholders or any other person shall have sustained in con- sequence of iuch violation. 17 It shall not be lawful for any OFFICERS bank to loan to its president or to any of its vice-presidents or its salaried officers or employees, or to cor- porations or firms controlled by them, or in the management of which any of them are actively engaged, until an application for such loan shall have been first approved, both as to secu- rity and amount, by the board of directors. (Section 10.) Banks or banking associations STOCK, may be organized under the uqui"dation provisions of this Act in all cities, towns, and villages with a minimum capital stock according to the popu- lation of such cities, towns, and villages, as follows : In all cities, towns and villages of not ex- ceeding five thousand inhabit- MINIMUM i-i-i. V a i.1, J CAPITAL ants, 01 twenty-nve thousand dollars. In all cities, towns and villages of over five thousand inhabitants and less than ten thousand inhabitants, of fifty thousand dollars. 18 In all cities, towns and villages of ten thou- sand inhabitants and less than fifty thousand inhabitants, of one hundred thousand dollars. In all cities, and towns of fifty thousand in- habitants or more, of two hundred thousand dollars. IMPAIRMENT Should the capital stock of any OF bank organized under this Act become impaired, the Auditor shall give notice to the president to have the impairment made good by assessment of the stockholders or a reduction of the capital stock ASSESSMENT °^ such bank, if the reduction should not bring the capital be- low the provisions of this section; and if the capital stock of said bank shall remain im- paired for thirty days after notice by the Auditor, he shall have power, and it is hereby made his duty, to enter suit against each stock- holder in the name of the People of the State of Illinois, for the use of said bank, for his or her pro rata proportion of such impairment, and when collected shall pay over the amount thereof to said bank, and the judgment in such 19 case shall be for the amount claimed with all costs and reasonable attorney's fees^ which fees shall be fixed by the court; or, if it appears from the reports made to the Auditor under this Act, or from any examination made by or on behalf of the Auditor, that the conditions of any bank organized under this Act are such that the impairment cannot be made good, or that the business of any such bank is being con- ducted in an illegal, fraudulent or unsafe man- ner, he may, in his discretion, without having taken the steps provided in this section to make good the impaired capital stock, through the Attorney General, file a bill in the circuit court of the county in which said bank is located, in the name of the People of the State of Illinois against said bank and its stockholders for the dissolution of the corporation DISSOLUTION, jr. . . .. J P RECEIVER a^^d tor an mj unction, and lor the appointment of a receiver for the winding up of the affairs of the bank. And said court, upon presentation of said bill, and upon being made satisfied that the capital stock of said bank has become impaired to such 20 an extent that it cannot be made good, or that such bank is being conducted in an illegal, fraudulent or unsafe manner, shall immediately appoint a competent and disinterested person as such receiver, and shall determine and fix his bonds and shall prescribe his duties. And said cause shall proceed as other cases in equity. And no bill shall be filed nor proceedings com- menced in any court for the dissolution or for the winding up of the affairs or for the ap- pointment of a receiver for any such banking corporation on the grounds of insolvency or im- pairment of the capital stock of such banking corporation or upon the ground that such bank is being conducted in an illegal, fraudulent or unsafe manner, except in the name and by the authority of the Auditor of Public Accounts, represented by the Attorney General. ^\Tien it shall be ascertained, in the course of the ad- ministration of the estate of a bank in the hands of a receiver that the assets of the bank are in- sufficient to discharge the entire liability of such bank to its creditors, and when the amount of such deficiency is determined, the court may, 21 in its discretion, direct the re- ment'^of' ceiver to proceed to enforce the STOCK- ^ liability of the stockholders to LIABILITY creditors, provided in section six of this Act; and when so directed, such receiver shall have the power, and it shall be his duty, to take such action, by suit or otherwise, as the court may direct, to enforce such liability for the benefit of the creditors and to disburse to creditors the amounts collected thereon, in the same manner as disbursements are made to creditors of the assets of the bank. Such receiver shall file with the Auditor a copy of each report which he makes to the court appointing him in order that the said Auditor may have at his command a complete record of all State institutions whose business has been so liquidated. At any time, whenever a majority in num- ber and amount of the creditors of any such bank or association, after any such receiver shall have been appointed, shall petition the court for the appointment of any person nomi- nated by them as receiver, who is a reputable 22 person and elector of the county in which said bank or association is located, it shall be the duty of the court to make such appointment, and all the rights and duties of its predecessors shall at once devolve upon such appointee. (Section 11.) Whenever the board of direct- T?otf^'"'°^ ors, managers or trustees, of CHANGE OF any corporation having any NAME, u 1 • • i.- u PLACE OF bankmg powers, existing by CHAN^cfEs' IN virtue of any general or special MANAGE- law of this State, or any cor- How MADE poration with banking powers hereafter organized under the provisions of this Act may desire to change the name, to change the place of business, to in- crease or decrease the capital stock, to increase or decrease the number of directors, managers or trustees, or to consolidate such corporation with any other corporation having banking powers which may hereafter exist, they may call a special meeting of the stockholders of such corporation for the purpose of submitting to a vote of such stockholders the question of 28 such change of name, change of place of busi- ness, increase or decrease of number of direc- tors, managers or trustees, increase or decrease of capital stock, or consolidation with some other corporation, as the case may be: Provided, that in changing the name of any corporation under the provisions hereof, no name shall be assumed or adopted by any corporation organ- ized under the laws of this State, without the consent of such other corporation, and that in no case shall the capital stock be diminished to the prejudice of the creditors of such corpora- tion, or the number of directors, managers or trustees be reduced to less than five, or in- creased to more than eleven. Such special meeting shall be MEETINGS called by delivering personally, or by depositing in the postoffice at least thirty days before the time fixed for such meeting, a notice properly addressed to each stockholder, signed by a majority of said directors, managers or trustees, stating the time, place and object of such meeting. A general notice of the time, place and object of 24 such meeting shall also be published for three successive weeks in some newspaper printed in or nearest to the county in which the principal business office of said corporation is located. At any such meeting stockhold- VOTING i. • u ON SAME ers may vote m person or by proxy, each stockholder being entitled to one vote for each share of stock held by him, and votes representing two-thirds of all the stock of the corporation shall be necessary for the adoption of the proposed change of name, place of business, number of directors, managers or trustees, amount of cap- ital stock, or consolidation with some other company. At any reffular meeting, or at CERTIFICATE .v .• j i -n j • OF STOCK- the time and place specmed in CONS^ent' ^^^^ notice of a special meeting called for that purpose, said propositions, or any of them, may be submitted to a vote, and if it shall appear that two-thirds of all the votes represented by the whole stock of such corporation are in favor of the proposi- tions, or any of them so submitted, a certificate 25 thereof, verified by the affidavit of the presi- dent, and under seal of the corporation, shall be filed in the office of the Auditor, and a like certificate filed for record in the office of the recorder of deeds of the county where the prin- cipal business office of such corporation is lo- cated; and upon the filing of such certificates the changes proposed and voted for at such meeting, as to name, place of business, increase or decrease of capital stock, or number of di- rectors, managers, or trustees, or consolidation with some other company, shall be and is here- by declared accomplished, in accordance with the said vote of the stockhold- BANKS ers: And, provided, further, th?S^act"''° that any corporation with bank- ing powers availing itself of or accepting the benefits of, or formed under this Act, and all corporations with banking powers existing by virtue of any special charter or gen- eral law of this State, shall be subject to the provisions and requirements of this Act in every particular, as if organized under this Act. Such corporation shall, upon the filing of 26 said certificate, cause to be published in some newspaper in or nearest to the county in which their principal office is located, a notice of such changes of organization for three successive weeks. Such chanee of name, place of RIGHTS OF V . .^ J ^ r CREDITORS business, increase or decrease or IMPAIRED capital stock, increase or de- crease of number of directors, managers or trustees, or consolidation of one corporation with another, shall not affect suits pending in which such corporations or corpora- tion shall be parties; nor shall such changes af- fect causes of action, nor the rights of persons in any particular, nor shall suits brought against such corporation by its former name be abated for that cause. (Section 12.) All corporations with banking T?or?^'''°^ powers consolidating as pro- PROCEEDINGS vided in section twelve shall for- FORWARDED Ward to the Auditor the com- plete proceedings of their con- solidation, a list of the stockholders and such other records as the Auditor may require, when 27 the Auditor shall proceed as provided in sec- tion five of this Act in regard to the organiza- tion of new banks, and until he shall so proceed, and such consolidated corporation shall comply with all the provisions of such section, it can not begin business. (Section 13.) In all cases where any corpora- tkJ'n'^o'f^ tion having any banking pow- CHANGES ers, existing under and by PRIOR ACT virtue of any general or special laws of this State, has, prior to the passage of this Act, changed its name or its place of business, or increased or decreased its capital stock, or the number of its directors, managers, or trustees, in the manner provided by an Act of the General Assembly of this State, entitled, "An Act to provide for chang- ing the names, for changing the place of busi- ness, for increasing or decreasing the capital stock, for increasing or decreasing the number of directors, and for the consolidation of in- corporated companies," approved and in force March 26, 1872, such change or changes are hereby ratified and confirmed and made valid and legal in all respects as if made in pur- suance of the provisions of this Act. (Sec- tion 14.) DEPOSITS ^^y association organized un- WITH der this Act, or any corporation AUDITOR M-t 1 1 • J FOR With banking powers organized PUFip'oSE^"^^ in pursuance of any general or special law of this State, or any consolidated corporation with banking powers as provided for by this Act, on depositing with the Auditor an amount of money equal to the whole amount of debts and demands against it, including the expenses of this proceeding, may determine its affairs, distribute its assets among its stockholders, resign its charter or certificate of incorporation, and close up its business, by a resolution passed at a meeting of its stockhold- ers called for such purpose. The Auditor PUBLICATION ^^^^^ cause a copy of such reso- OF lution to be published in some TO newspaper published in the city CLAiivfs^^^' ^^ village where such bank or corporation is located; or if no newspaper shall there be published, then in the 29 newspaper nearest to such city or village, and the Auditor shall in such publication also give notice that the notes and demands against such bank or corporation will be redeemed by him, and if any outstanding notes or other demands are not presented in one year, such bank may deposit with the Auditor or elsewhere, under his direction, and subject to his order, on in- terest, a sum sufficient to meet such outstanding demands, which when presented to the Auditor, shall be paid by him out of such sum, and after six years from the day on which the publica- tion of the dissolution was first made, the Auditor shall return to the stockholders, to be among them distributed^ the remainder of any sum so deposited. COMPENSA- '^^^ Auditor shall be entitled to TION OF two per cent, of all money paid out by him under the provisions of this section, where the amount so paid, on account of any one bank or corporation, shall not exceed five thousand dollars, and one per cent, after that. (Section 15.) 30 TRUST COMPANIES Any corporation which has or POWERS shall be incorporated under the general incorporation laws of this State, being an Act entitled "An Act con- cerning corporations/' and all amendments thereof, for the purpose of accepting and ex- ecuting trusts, and any corporation now or here- after authorized by law to accept or execute trusts, may be appointed assignee or trustee by deed, and executor, guardian or trustee by will, and such appointment shall be of like force as in case of appointment of a natural person. (Section 1, Trust Company Act.) Whenever application shall be COURT MAY J . V, i. • 1.V ci. 1. APPOINT made to any Court in this htate COMPANY ^^^ *^^ appointment of any re- RECEIVER, ceiver, assignee, guardian, con- GUARDIAN, / i. J • 1. i. ETC. servator, executor, administrator or other trustee, it shall be law- ful for such court to appoint any such corpora- 31 tion as such trustee, receiver, assignee, guardian, conservator, executor or administrator: Pro- vided, any such appointment as guardian or con- servator shall apply to the estate only, and not to the person. DEPOSITORY ^"y ^^"y* having appointed and FOR COURT having iurisdiction of any re- FUNDS ° 1 . . ceiver, executor, admmistrator, conservator, guardian, assignee or other trustee, upon the application of such officer or trustee, or upon the application of any person having an interest in the estate administered by such officer or trustee, after such notice to the other parties in interest as the court may direct, and after a hearing upon such application, may order such officer or trustee to deposit any moneys then in his hands, or which may come into his hands thereafter, and until the further order of said court, with any such corporation and upon deposit of such money, and its re- ceipt and acceptance by such corporation, the said officer or trustee shall be discharged from 32 further care or responsibility therefor. Such deposit shall be paid out only upon the orders of said court. Whenever in the judgment of BONDS OF any court having jurisdiction of ASSIGNEE,' any estate in process of admin- ETC, HOW .... V REDUCED istration by any assignee, re- ceiver, executor, administrator, guardian, conservator or other trustee, the bond required by law of such officer shall seem bur- densome or excessive, upon application of such officer or trustee, and after such notice to the parties in interest as the court shall direct, and after a hearing on such application, the said court may order the said officer or trustee to de- posit with any such corporation, for safe keep- ing, such portion of all of the personal assets of said estate as it shall deem proper, and there- upon, said court shall, by an order of record, reduce the bond to be given, or therefor given by such officer or trustee, so as to cover only the estate remaining in the hands of said officer or 33 trustee, and the property as deposited shall thereupon be held by such corporation under the orders and directions of said court. (Section 2, Trust Company Act.) Such corporation shall not be GIVE BOND required to give any bond or security in case of any appoint- ment hereinbefore provided for, except as in hereinafter provided, but shall be responsible for all investments which shall be made by it of the funds which may be entrusted to it for investment by such court, and shall be fur- ther liable as natural persons in like positions now are, and as hereinafter provided. The amount of money which any LIMITATIONS , ».- \ ^^ x. AS TO LOANS such corporation shall have on deposit at any time shall not exceed ten times the amount of its paid up cap- ital and surplus, and its outstanding loans shall not at any time exceed said amount. (Section S, Trust Company Act.) INTEREST Such company shall pay interest upon all moneys held by it by virtue of this Act, at such rate as may be agreed 34 upon at the time of its acceptance of any such appointment, or as shall be provided by order of the court. (Section 4, Trust Company Act.) Such corporations shall be en- SAT I ON^' titled to and shall be allowed proper compensation for all the services performed by them under the provisions of this Act, but such compensation shall not exceed that allowed to natural persons for like services. (Section 5, Trust Company Act.) Each company in all cities and 5m?2^'"''^ towns of 100,000 inhabitants or AUDITOR FOR more, before accepting any such CREDITORS appointment or deposit shall deposit with the Auditor of Public Accounts the sum of $200,000, and each company in all cities and towns of less than 100,000 inhabitants shall deposit with the Auditor of Public Accounts the sum of $50,000, said deposit to be for the benefit of the credit- ors of said company, and to consist of bonds of the United States or municipal bonds of this State, or in mortgages on improved and pro- 35 ductive real estate in this State, being first liens thereon, and the real estate being worth at least twice the amount loaned thereon. Bonds and EXCHANGE securities so deposited may be OF exchanged, from time to time, SECURITIES o ^ y for other securities receivable as aforesaid. Said bonds of the United States or municipal bonds of this State to be registered in the name of said Auditor officially, and all said securities to be subject to sale and transfer and to the disposal of the proceeds by said Auditor only on the order of a court of com- petent jurisdiction and as hereinafter provided in section 18. So long as the company so de- positing shall continue solvent, such company shall be permitted to receive from said Auditor the interest or dividends on said deposit: Pro- vided, however, that when it shall appear to the Auditor of Public Accounts from the annual re- port of any such company that the value of the personal property and the cash held and pos- sessed by such company by virtue of the pro- visions of this Act, and any amendment thereof, 36 exceeds ten times the amount of SECURITIES the deposit aforesaid, he shall WH^E^N'sAfo require said companies, if in DEPOSIT cities or towns of 100,000 in- INCREASED habitants or more to forthwith DHVilNISHED increase said deposit to the sum of $500,000 in such securities, and in all cities and towns of less than 100,000 inhabitants to forthwith increase the said de- posit to the sum of $125,000 in such securities. And whenever it shall appear to the Auditor of Public Accounts that the amount of personal property and cash so held by any such company has been reduced below ten times the value of its original deposit above provided for, and said company is not in any default in its duties and obligations hereunder, he shall allow said com- pany to reduce its said deposits to the sum orig- inally required in this section by the withdrawal of such additional deposits until such time as an increase in its holdings shall again require an additional deposit as hereinbefore provided. No corporation authorized to accept and exe- cute trusts shall either directly or indirectly, 37 through any officer, agent or employee of such corporation, certify to any bond, note or other obligation to evidence debt, secured by any trust deed or mortgaffe upon or COMPLIANCE . t. t ' WITH ACT accept any trust concerning property located wholly or in part in this State without complying with said Act and the amendments thereto; and any trust deed or mortgage given or taken in violation of the provisions of said Act and the amendments thereto shall be null and void. (Section 6, Trust Company Act.) DEPOSITS IN When any part of such deposit MORTGAGES is made in bonds and morteaffes TO BE o o ACCOMPANIED i* shall be accompanied by full ^^f!-®^^*^^*^' abstracts of titles and searches, and shall be examined and ap- proved by or under the direction of the Auditor. The fees for an examination of title by counsel, to be paid by the company making the deposit, shall not exceed $20 for each mortgage, and the fee for each appraiser not exceeding two, be- sides expenses, shall be $5 for each mortgage. (Section 7, Trust Company Act.) 38 AUTHORI2A- ^^ ^^^^^ '^ot be lawful for any TlON BY such company to accept any trust or deposit as hereinbefore provided, after the passage of this Act, with- out first procuring from the Auditor of Public Accounts a certificate of authority stating that such company has complied with the require- ments of this Act in respect to such deposit. (Section 8, Trust Company Act.) Such companies shall file with AND the said Auditor, during the f ioNs"^^ month of January of each year, a statement, under oath, of the condition of such company on the thirty-first day of December next preceding, exhibiting the following items in the following form: ^,_._. , (a) The assets of said com- YEARLY REPORT, pany, specifying: of^aIsets"^ First— The description and market value, or as nearly as may be, of the real estate owned by such company. Second — The amount of cash on hand and 39 deposits in banks to the credit of said company, specifying in what banks such deposits are. Third — The amount of cash in the hands of agents and in the course of transmission. Fourth — The amount of loans secured by mortgages and bonds^ constituting a first lien on real estate, on which there shall be less than one year*s interest due or owing, and the amount of such interest. Fifth — The amount of such loans on which there shall be more than one year's interest due or owing, and the amount of such interest. Sixth — The amount due the company on which judgments have been obtained. Seventh — The amount of stocks and bonds of this State, and of the United States, of any in- corporated city of this State, and of any other stocks and bonds owned by such company, specifying the amount, number of shares, and the par and market value of each kind of stock or bonds. Eighth — The amount loaned upon the pledges of securities, with a statement of the securities 40 so held by such company, and the par and mar- ket value of such securities. Ninth — The amount of all other assets of such company, including accrued interest not enumerated above. (b) The liabilities of such STATEMENT company, specifying: LIABILITIES, First— The capital stock paid in. STATEMENT c J rr.u i u J OF TRUSTS Second — Ihe surplus on hand. Third — The undivided profits. Fourth — The deposits held by such company. (c) A list and brief description of the trusts held by such company, the source of the appointment thereto, and the amount of real and personal estate held by such company by virtue thereof, except that mere mortgage trusts wherein no action has been taken by such company, shall not be included in such state- ment. The said report shall also be in such form and contain such statements, returns and information, as to the affairs, business condi- tion, and resources of the corporation, as the said Auditor of State may, from time to time. 41 prescribe or require. (Section 9, Trust Com- pany Act.) Such report shall be verified by VERIFICATION ., «./ ,. r, ^ . , ^ OF REPORT, the athdavit ot one or the man- l^'^'J^^I^ aging officers, and two of the directors or trustees of said company, who shall also state in such affidavit that they have examined the assets and books of said company for the purpose of making said report. Any false swearing in regard to such report shall be deemed perjury, and shall be subject to the punishments prescribed by law for such offiense. (Section 10, Trust Com- pany Act.) The Auditor of Public Accounts tk)NS^from' ^^ hereby authorized and em- AUDITOR, powered to address any in- ADDITIONAL • • . i. reports quiries to any such company, or the officers thereof, in relation to its doings and condition, or any other matter connected with its affairs, and it shall be the duty of any company or person so addressed, to promptly reply in writing to such inquiries. The Auditor may also require reports from any 4S such corporation at any time he may deem de- sirable. (Section 11, Trust Company Act.) YEARLY -^^ shall be the duty of said EXAMINA- Auditor, annually, either per- sonally or by one or more com- petent persons to be appointed by him, to visit and examine every such corporation in this State. The Auditor shall also have power, in like manner, to examine any such corporation whenever, in his judgment, it may be deemed necessary or expedient. The said Auditor and every such examiner shall have power to ad- minister an oath to any person whose testimony may be required on any such examination, and to compel the appearance and attendance of any such person for the purpose of examina- tion, by summons, subpoena or attachment, in the manner now authorized in respect to the at- tendance of persons as witnesses in the courts of record in this State; and all books and papers which may be deemed necessary to ex- amine by the Auditor or examiner so appointed shall be produced, and their production may be compelled in like manner. The expense of 43 every examination, if any, shall EXAMINATION ^e paid by the corporation ex- amined, in such amount as the Auditor shall certify to be just and reasonable: but whenever such special examination shall be made by the Auditor in person, or by one or more of the regular clerks in his department, no charge shall be made except for necessary traveling and other actual expenses. On every examination, inquiry shall be made as to the condition and resources of the corporation gen- erally, the mode of conducting and managing its affairs, the action of its directors or trustees, the investment of its funds, the safety and pru- dence of its management, the security afforded to those by whom its engagements are held, and whether the requirements of its charter and of the laws have been complied with in the administration of its affairs. The result of CERTIFICA- ^^^^ examination shall be certi- TION OF fied by the examiners or one of EXAMINATION ^j^^^^ ^^^^ ^^^ ^^^^^^^ ^^ ^j^^ corporation examined, and the result of all the examinations during the preceding two years, 44 shall be embodied in the report of the Auditor required by this Act to be submitted to the Legislature. Such report shall give date to which such report refers, the amount of capital returned by each of said corporations, the whole amount of its debts and liabilities, the total sum of its resources, and such other in- formation as such Auditor may deem useful. (Section 12, Trust Company Act.) PUBLICATION "^^^ ^^^^ Auditor shall cause a OF proper abstract of the state- ments of assets and liabilities reported under section nine of this Act, to be published once in each week for three con- secutive weeks, in two newspapers of general circulation, the one printed in the city of Springfield, and the other in the county seat of the county wherein the principal office of the respective company is located, such publication to be paid for by said company. (Section l6, Trust Company Act.) Whenever it shall appear to the UNLAWFUL .1 A -,.. PI, BANKING said Auditor from any such ex- amination or report, that any 45 such corporation has committed any violation of law, or is conducting its business in an unsafe or unauthorized manner, he shall, by an order under his hand and seal, direct OF^'u'vw^'^^ the discontinuance of such il- INSTITUTION legal and unsafe or unauthor- PROCEEDINGS l^ed practices, and strict con- formity with the requirements of the law, and with safety and security in its transactions; and whenever any such corpora- tion shall refuse or neglect to make any such report as is hereinbefore required, or to comply with any such order as aforesaid, or whenever it shall appear to the Auditor that it is unsafe or inexpedient for any such corporation to con- tinue to transact business, or that extraordinary withdrawals of money are jeopardizing the in- terest of remaining depositors, or that any trustee or officer has abused his trust or been guilty of misconduct or malversation in his offi- cial position, injurious to the institution, or that it has suffered a serious loss by fire, burglary, repudiation or otherwise, he shall communicate the facts to the Attorney General, who shall 46 thereupon institute such proceedings against the corporation as the nature of the ease may require. (Section 13^ Trust Company Act.) REVOCATION ^^ *^^ Auditor shall at any time OF have satisfactory evidence that CERTIFICATE ^^^ annual statement or other report required or authorized by this Act, made or to be made by any officer or officers of such corporation, is false, it shall be the duty of the said Auditor to immediately revoke the cer- tificate of authority granted on behalf of such corporation, and mail a copy of such revocation to said corporation and the clerk of every court of record in this State. Such revocation shall not be set aside until satisfactory evidence shall be given to said Auditor that such corpo- ration is, in substance and in fact, in the con- dition set forth in such statement or report, and that all the requirements of this Act have been complied with. Such revocation shall be suffi- cient cause for the removal of such company from any appointment held by it under the pro- visions of this Act. (Section 14, Trust Com- pany Act.) 47 PENALTY ^^y violation of any of the pro- visions of this Act shall subject the party violating the same to a penalty of $500 for each offense^ and the additional sum of $100 per day during which any such com- pany shall fail to file its said report after the last day of January in each year. (Section 15^ Trust Company Act.) Pggg There shall be paid by every company to whom this Act shall apply, the following fees: For filing the orig- inal application and receiving the deposit re- quired by section six of this Act, the sum of $30; for filing the annual statement required, $10; for the certificate of authority, $2; for every copy of a paper filed in the Auditor's office, the sum of 20 cents per folio; for affixing the seal of said office to said copy, certifying the same, $1. (Section 17, Trust Company Act.) RETIRING ^^y company which desires to FROM retire from business under this BUSINESS ^^^^ gjj^jj furnish to the Auditor satisfactory evidence of its release and dis- 48 charge from all the obligations and trusts here- inbefore provided for^ whereupon he shall revoke his certificate to such company, and re- turn its securities. (Section 18, Trust Com- pany Act.) 49 INDEX STATE BANKS. PAGE Application to organize 6 Auditor, compensation of 30 Business, change of place 23, 28 By-Laws 8 Capital, increase or decrease of 23, 28 Capital stock, amount of 18 Capital stock, impairment of 19 Certificate of authorization 11 Claims, presentation of and payment of ... 30 Directors, election of 6, 7, 9 Directors, liable for illegal loans 17 Directors, qualifications of 9 Dissolution 20 Elections, 6, 7, 9 Examinations 14 51 PAGE Examiners^ compensation of 15 Examination prior to opening 11 Liability of stockholders 12 Liabilities, total of 16 Liquidation 29 Liquidation, deposits for purpose of 29 Loans, limitations and restrictions ... 1 6, 17, 18 Management 5 Meetings of directors 10 Name, change of 23, 28 Oath of office 8 Organization 5 Powers 5 Real estate 15 Receiver 20 Report of liquidated banks 22 Reports 13 Reports, penalty for neglect 14 Reports, publication of 14 52 PAGE Shares 5 Statements, false 10 Stockholders' liability^ enforcement of .... 22 Stockholders' liability 12 Stockholders, list of, to be recorded 12 Subscription to stock . 6 Vacancies 9 Voting 7 TRUST COMPANIES. Auditor, communications from 42 Authorization by auditor 39 Bonds, certification of 38 Bonds, reduction of 33 Bonds, not required 34 Certificate, revocation of 47 Certification of bonds, etc 38 Compensation of company 35 Court funds 32 53 PAGE Deposits, limitation of 34 Deposits with auditor 35 Examinations 43 Fees to auditor 48 Fees for titles and appraisals 38 Fees for examinations 44 Interest 34 La-y, violations of 46 Liquidation 48 Loans, limit of 34 Mortgage loans 38 Penalties 48 Powers and privileges 31 Reports 39, 42 Securities, exchange of 36 Securities, increase or decrease of 37 Securities, interest on 37 Statements, publication of 45 Unlawful banking 45 54 OFFICERS Edward Tilden President John Fletcher Vice-President Geo. M. Benedict Casliier J. C. Morrison Assistant Cashier H. P. Gates Assistant Cashier ^x DIREC TORS Edward Tilden Wm. A. Tilden L. B. Patterson John Fletcher AveriU Tilden * ^x /<co/o 247114 ;:U7^i ^^':ii.43 ^^^:.'v m '^ .-h- ^::v^ n'*^L iV. ^r.' 1^:/^^ / *VJ>^v ^ ,i5: ■^ • .; *)'• '"^ • ;*> ■?1^<^V v•^^f^;■''::^?^''; ^,1^. i. ,i ^'^