Michigan Laws 487.3307 – Required capital; applicability of section to consolidated organization; authorization of stock savings bank or mutual savings bank to commence business; total capital; maintenance of surplus amount
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(1) A stock savings bank organized under this act shall have capital in an amount as the commissioner considers adequate.
(2) This section does not apply if the new stock savings bank is organized under section 706 for the sole purpose of effecting its consolidation or merger with an existing bank or association having its principal office in the same city or village as the new stock savings bank and if upon completion of the consolidation or merger a bank holding company becomes the owner of all of the outstanding voting shares of the consolidated organization. This section does apply to the consolidated organization.
Terms Used In Michigan Laws 487.3307
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Association: means a federal savings association organized under section 5 of the home owners' loan act, chapter 64, 48 Stat. See Michigan Laws 487.3102
- Bank: means a state banking corporation organized or reorganized under the provisions of the banking code of 1999, 1999 PA 276, MCL 487. See Michigan Laws 487.3102
- Bank holding company: means a stock or mutual company as defined in the bank holding company act of 1956, chapter 240, 70 Stat. See Michigan Laws 487.3102
- Capital: means the stated par value of issued and outstanding unimpaired common stock and the stated par value of issued and outstanding unimpaired preferred stock. See Michigan Laws 487.3102
- Commissioner: means the commissioner of the office of financial and insurance services. See Michigan Laws 487.3102
- Consolidated organization: means an organization that results from a consolidation of consolidating organizations. See Michigan Laws 487.3102
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- Federal Deposit Insurance Corporation: A government corporation that insures the deposits of all national and state banks that are members of the Federal Reserve System. Source: OCC
- Mutual savings bank: means a savings bank for which the articles of incorporation do not authorize the issuance of common or preferred stock. See Michigan Laws 487.3103
- Savings bank: means a state banking corporation organized or reorganized under this act. See Michigan Laws 487.3103
- Stock savings bank: means a savings bank for which the articles of incorporation authorize the issuance of capital stock. See Michigan Laws 487.3103
- Surplus: means the amount paid for issued and outstanding common and preferred stock in excess of the stated par value, plus any amount of transferred undivided profits, and any additional amounts paid in or contributed to increase total capital. See Michigan Laws 487.3103
- Total capital: means an amount equal to any capital, plus any surplus, undivided profits, and instruments of indebtedness authorized under section 310. See Michigan Laws 487.3103
(3) A stock savings bank shall not be authorized to commence business until it has surplus of at least 20% of its capital.
(4) A mutual savings bank shall not be authorized to commence business until:
(a) An aggregate minimum dollar amount and number of savings accounts shall be subscribed for and paid in cash, as determined by the commissioner.
(b) The commissioner shall have received confirmation from the federal deposit insurance corporation that the accounts of the mutual savings bank will be insured by the federal deposit insurance corporation.
(5) After organization each savings bank shall maintain adequate total capital for the conduct of its business and the protection of its depositors. The total capital of a savings bank shall be analyzed and appraised in relation to the character of its management, the liquidity of assets, history of earnings and of the retention of earnings, the potential volatility of the deposit structure, its risk management, and the savings bank’s capacity to furnish the broadest service to the public.
(6) At all times a stock savings bank shall maintain surplus in an amount which is equal to at least the amount of its capital, except as provided in subsection (3) as to the initial surplus and except as provided in section 316 and shall not reduce surplus without the approval of the commissioner.