CHAPTER 60.

IN RELATION TO SAVINGS BANKS.

AN ACT to Provide for the Organization and Management of Savings s. F. 48.
Banks.

general incor

form.

SECTION 1. Be it enacted by the General Assembly of the May be State of Iowa, That corporations to be known as savings banks formed. may be formed, under and in accordance with the provisions of this act, for the purpose of receiving on deposit the savings and funds of others, and preserving and safely investing the same, and paying interest or dividends thereon; and such corporations, and the stockholders thereof, shall be subject to all the conditions and liabilities herein imposed; and hereafter no association shall be Not to be formed under the general incorporation acts for the purpose of formed under transacting such banking business; and all corporations now or- poration laws. ganized thereunder and doing business as savings banks, shall, on Existing or before the 1st day of July, A. D. 1875, conform to and reor- banks to conganize under the provisions of this act, as hereinafter provided, and any failure or neglect of the proper officers of such associations to comply with the provisions of this act, shall be regarded as a forfeiture of all rights and privileges of such associations. SEC. 2. It shall be lawful for any number of persons, not Organization. less than five, to organize savings banks under the provisions of this act, with a paid-up capital stock of not less than ten thousand dollars in cities and towns of ten thousand inhab- capital. itants, or under; and a paid-up capital stock of not less than fifty thousand dollars in cities of over ten thousand inhabitants; which said corporations shall be known as savings banks, and shall have power to transact the usual business of such institutions, but not to issue bank-notes to circulate as money, but no such association shall have the right to commence business until its officers elect, or its shareholders, shall have furnished to the auditor of state a sworn statement of the paid-up capital, and, when the auditor of state is satisfied as to the fact, he shall issue to such association a certificate authorizing it to Auditor's commence business, a copy of which shall be published in some certificate. newspaper printed in the county where such association is located, for four consecutive weeks, at the expense of such association. If the auditor of state should deem it necessary

Amount of

before issuing a certificate, he may make a personal examina- Auditor m tion of capital stock, or cause one to be made by some com- examine. petent person appointed by him, the expense of which shall be paid by the association.

incorpora

SEC. 3. Any five or more persons of full age, a majority of Articles of whom shall be citizens of this state, who may desire to form an tion. incorporated company for the purposes herein before specified, shall make, sign, and acknowledge, before some officer competent to take acknowledgments of deeds, and file in the office of the Filed. recorder of the county wherein the principal place of business of

stated in

articles.

the company is intended to be located, and a certified copy thereof in the office of the secretary of state, articles of incorporaWhat shall be tion, in which shall be stated, the corporate name of the corporation; the object for which the corporation shall be formed; the amount of its capital stock; the time of its existence not to exceed fifty years; the number of its directors or trustees, and their names, who shall manage the affairs of the association for the first year; and the name of the city, or town, and county in which the principal place of business of the company is to be located; and a notice must be published in some newspaper published in the county wherein said bank is located for four consecutive weeks, stating the substance of the above requirements.

Notice.

evidence.

SEC. 4. A copy of any articles of incorporation, filed in purCertified copy suance of this act and certified to by the recorder of the county in which it is filed, or by the secretary of state, shall be received in all courts, and in all actions and proceedings, as presumptive evidence of the facts therein stated.

Enumera

SEC. 5. When the certificate of the auditor shall have been received, and the articles of incorporation shall have been filed tion of powers. and recorded, and publication shall have been made as hereinbefore provided, the persons who shall have signed and acknowledged the same, and such persons as thereafter become their associates, or successors, shall be a body politic and corporate, and by their corporate name shall have succession for the period limited, and power:

First. To sue and be sued in any court.

Second. To make and use a common seal, and to alter the same at pleasure.

Third. To purchase, hold, sell, convey, and release from trust or mortgage, such real and personal estate as hereinafter provided for in this act.

Fourth. To appoint such officers, agents, and servants, as the business of the corporation shall require, to define their powers, prescribe their duties, and fix their compensation, and to require of them such security as may be thought proper for the fulfillment of their duties.

Fifth. To loan and invest the funds of the corporation; to receive deposits of money, and to loan and invest the same as hereinafter provided, and to repay such deposits without interest, or with such interest as the by-laws of the constitution may provide.

Sixth. To make by-laws, not inconsistent with the laws of this state, for the organization of the company, and the management of its property, the regulation of its affairs, the condition on which deposits will be received, the time and manner of dividing the profits and of paying interest on deposits, and for carrying on all kinds of business within the objects and purposes of the company.

SEC. 6. The business and property of such savings banks shall Management be managed by a board of directors or trustees, of no less than five nor more than nine, all of whom shall be shareholders and citizens of this state, the first board to be designated in the arti

take oath.

auditor of

cles of incorporation; and who shall organize by taking an oath, Directors or diligently, faithfully, and impartially to perform the duties im- trustees to posed upon them by this act, and not knowingly to violate, or willingly to permit to be violated, any of the provisions thereof; that said directors or trustees are the bona fide owners in their own right of the stock standing in their respective names on the books of the bank; and that the same are not hypothecated, or in any manner pledged as security for any loan obtained, or debt owing to said savings bank; a certificate of which oath, signed by each director, and certified to by the officers before whom it was taken, shall be filed and preserved in the office of the auditor of state. Oath to be The call for the first meeting of directors or trustees shall be filed with signed by one or more persons named as directors or trustees in state. the certificate, setting forth the time and place of meeting, which First meeting notice shall be delivered personally to each director, or published or board. at least ten days in some newspaper published in the county in which is the principal place of business of the corporation, or, if no newspaper is published in the county, then in a newspaper nearest thereto. At their first meeting, and as often thereafter as their by-laws shall require, the directors or trustees shall elect, from their number, a president and one or more vice presidents Officers. for the ensuing year; and shall appoint a treasurer or cashier, and such other subordinate officers, agents, and servants as may be required, who shall hold their offices at the pleasure of the board, and who shall give such security for the faithful performance of their duties as may be required by the by-laws. All vacancies in Vacancies in the board of directors or trustees shall be filled, at the next regular meeting after such vacancy shall arise, from among the stockholders, and the person receiving a majority of the votes of the whole number of directors or trustees shall be duly elected. The directors or trustees, to hold office after the expiration of the term Annual of those named in the certificate of incorporation, shall be annually elected at such time and place, and in such mode, and upon such notice as shall be provided by the by-laws of the company, and shall hold office for one year, or until their successors are elected and qualified. All such elections shall be by ballot, and each stockholder shall be entitled to one vote for every share of stock held by him, and the persons so receiving the greater number of votes, shall be directors of [or] trustees. Shareholders may vote Right to vote. by proxy duly authorized, and no shareholder shall be entitled to vote whose liability to said bank is past due and unpaid. If it Deferred should happen at any time that an election of directors or trustees shall not be had on the day designated in the by-laws of the company, it shall be lawful on any other day to hold such election, after giving due notice, and the directors or trustees shall be continued in office until their successors are elected and qualified. A majority of the directors or trustees shall constitute a Quorum. quorum of said board for the transaction of business, but said bank may provide in the by-laws that a smaller number, not less than five, one of whom shall be the president and [or] vice president, shall constitute a quorum, which number shall thereupon be authorized to transact business.

board.

elections.

election.

Deposits.

Limits.

deposits.

SEC. 7. All savings banks organized under this act may receive, on deposit, all such sums of money as shall from time to time be offered by tradesmen, merchants, laborers, servants, minors, and others. All such banks with a paid-up capital of ten thousand dollars may receive deposits to the amount of one hundred thousand dollars; those with a paid-up capital of twentyfive thousand dollars may receive deposits to the amount of two hundred and fifty thousand dollars; those with a paid-up capital of fifty thousand dollars, deposits to the amount of five hundred thousand; those with a paid-up capital of one hundred thousand dollars, deposits to the amount of one million dollars; and no greater amount of deposits shall be received without a like proportionate increase of cash capital, and which capital shall be regarded a guaranty fund for the better security of depositors, and so invested in some safe and available securities. Repayment of The deposits so received for the purpose of safe keeping, and invested as provided in this act, shall be paid to such depositor or his or her representatives when requested at such time or times, and with such interest, and under such regulations as the board of directors or trustees shall from time to time prescribe, not inconsistent with the provisions of this act, which regulations shall be printed and conspicuously exposed in some place, accessible and visible to all, in the business office of said bank, and no alteration, which may at any time be made in such rules or regulations, shall in any manner affect the rights of depositors in respect to deposits, or the interest thereon, made previous to such alteration. It shall be lawful for sav ings banks to require sixty days' written notice of the withdrawal of any deposits, but when there are sufficient funds on hand the officers of the bank may in their discretion waive this requirement. It shall be lawful for savings banks to close any be closed upon accounts upon written notice, as may be provided for in the bylaws, to a depositor to withdraw his deposit, after which notice it shall cease to draw interest: Provided, Nothing in this act shall be so construed as to prevent such banks in their discretion from issuing certificates of deposits, payable on demand.

May require notice.

Accounts may

notice.

Accounts

itation.

SEC. 8. All accounts upon which no deposit or drafts shall be made for a period of ten years in succession shall be so far closed by lim- closed that neither the sum deposited, nor the interest that shall have accrued thereon, shall be entitled to any interest after the expiration of the ten years from the date of the last deposit or Application. draft. This provision, however, shall not apply to endowments for children, to trust estates, nor to other cases where special provision is made therefor at the time of the deposit thereof.

Investment of funds.

SEC. 9. It shall be lawful for the directors or trustees of any such savings bank to invest the funds or capital belonging to said bank, and all moneys deposited therein, and all the gains and profits thereof, only as follows, to-wit:

First. In the stocks or bonds, or interest-bearing notes or certificates, of the United States.

Second. In the stocks or bonds, or evidences of debt bearing interest, of this State.

Third. In the stocks, bonds, or warrants of any city, town, county, village, or school-district of this State, issued pursuant to the authority of any law of this state, but not exceeding twentyfive per cent. of the assets of the bank shall consist of town, village, or school-district bonds or warrants.

Fourth. In notes or bonds secured by mortgage or deed of trust upon unincumbered real estate in this state, worth at least twice the amount loaned thereon.

Fifth. It shall be lawful for said banks to discount, purchase, sell, and make loans upon commercial paper, notes, bills of exchange, drafts, or any other personal or public security; but said bank shall not purchase, hold, or make loans upon the shares of its capital stock.

real estate.

Sixth. In all cases of loans upon real estate, all the expenses Loans upon of searches, examinations, and certificates of title, or the inspection of property, appraisals of value, and of drawing, perfecting, and recording papers, shall be paid by such borrowers. Wherever buildings are included in the valuation of any real estate upon which a loan shall be made by said bank, they shall be insured by the mortgager, for the benefit of the bank for at least Insurance. two-thirds their value, in some reliable company, and the policy of insurance shall be duly assigned to the bank; and it shall be lawful for said bank to renew such policy of insurance from year to year, in case the mortgager neglects to do so, and may charge the same to him. All the necessary charges and expenses paid by said bank for such renewals shall be paid by such mortgager to the said bank, and shall be a lien upon the property so mortgaged until paid.

SEC. 10. It shall be lawful for savings banks to purchase, hold, Real estate and convey real estate only as follows, to-wit:

First. The lot and building in which the business of the bank may be carried on.

held by bank.

sold.

Second. Such as shall have been purchased at sales upon fore- When to be closure of mortgages owned by the bank, or upon judgment or decrees obtained or rendered for debts due it; and all such real estate as is described in this clause shall be sold by said bank within ten years after the title of the same shall be vested in it by purchases or otherwise.

SEC. 11. It shall be the duty of the board of directors or Interest on trustees, from time to time, to regulate the rate of interest or deposits. dividends to be allowed to depositors, and to pay the same upon Dividends. the presentation of the deposit-book or certificates; and after the payment of, or setting aside a sufficient amount to pay, the interest to depositors of said banks, and after deducting the necessary expenses of said banks, the board of directors or trustees may make from the surplus profits in hand in cash such dividends on the capital stock as in their discretion may seem best and proper. SEC. 12. The capital stock of all banks organized under this Shares. act shall be divided into shares of one hundred dollars each, and shall be deemed personal property, and shall be transferable on the books of the banks in such manner as shall be prescribed by the by-laws. No certificate representing shares of stocks shall