Missouri Revised Statutes
Chapter 362
Banks and Trust Companies
←362.170
Section 362.170.2
362.171→
August 28, 2015
Until December 31, 2016--Unimpaired capital, defined--restrictions on loans, and total liability to any one person.
362.170. 1. As used in this section, the term "unimpaired capital"
includes common and preferred stock, capital notes, the surplus fund,
undivided profits and any reserves, not subject to known charges as shown on
the next preceding published report of the bank or trust company to the
director of finance or obtained by the director pursuant to subsection 3 of
section 361.130. For purposes of lending limitations, goodwill may comprise
no more than ten percent of unimpaired capital.
2. No bank or trust company subject to the provisions of this chapter
shall:
(1) Directly or indirectly, lend to any individual, partnership,
corporation, limited liability company or body politic, either by means of
letters of credit, by acceptance of drafts, or by discount or purchase of
notes, bills of exchange, or other obligations of the individual, partnership,
corporation, limited liability company or body politic an amount or amounts
in the aggregate which will exceed the greater of: (i) twenty-five percent
of the unimpaired capital of the bank or trust company, provided such bank or
trust company has a composite rating of 1 or 2 under the Capital, Assets,
Management, Earnings, Liquidity and Sensitivity (CAMELS) rating system of the
Federal Financial Institute Examination Counsel (FFIEC); (ii) fifteen percent
of the unimpaired capital of the bank or trust company if located in a city
having a population of one hundred thousand or over; twenty percent of the
unimpaired capital of the bank or trust company if located in a city having a
population of less than one hundred thousand and over seven thousand; and
twenty-five percent of the unimpaired capital of the bank or trust company if
located elsewhere in the state, with the following exceptions:
(a) The restrictions in this subdivision shall not apply to:
a. Bonds or other evidences of debt of the government of the United
States or its territorial and insular possessions, or of the state of
Missouri, or of any city, county, town, village, or political subdivision of
this state;
b. Bonds or other evidences of debt, the issuance of which is authorized
under the laws of the United States, and as to which the government of the
United States has guaranteed or contracted to provide funds to pay both
principal and interest;
c. Bonds or other evidences of debt of any state of the United States
other than the state of Missouri, or of any county, city or school district
of the foreign state, which county, city, or school district shall have a
population of fifty thousand or more inhabitants, and which shall not have
defaulted for more than one hundred twenty days in the payment of any of its
general obligation bonds or other evidences of debt, either principal or
interest, for a period of ten years prior to the time of purchase of the
investment and provided that the bonds or other evidences of debt shall be a
direct general obligation of the county, city, or school district;
d. Loans to the extent that they are insured or covered by guaranties or
by commitments or agreements to take over or purchase made by any department,
bureau, board, commission, or establishment of the United States or of the
state of Missouri, including any corporation, wholly owned, directly or
indirectly, by the United States or of the state of Missouri, pursuant to the
authority of any act of Congress or the Missouri general assembly heretofore
or hereafter adopted or amended or pursuant to the authority of any executive
order of the President of the United States or the governor of Missouri
heretofore or hereafter made or amended under the authority of any act of
Congress heretofore or hereafter adopted or amended, and the part of the loan
not so agreed to be purchased or discounted is within the restrictive
provisions of this section;
e. Obligations to any bank or trust company in the form of notes of any
person, copartnership, association, corporation or limited liability company,
secured by not less than a like amount of direct obligations of the United
States which will mature in not exceeding five years from the date the
obligations to the bank are entered into;
f. Loans to the extent they are secured by a segregated deposit account
in the lending bank if the lending bank has obtained a perfected security
interest in such account;
g. Evidences of debt which are direct obligations of, or which are
guaranteed by, the Government National Mortgage Association, the Federal
National Mortgage Association, the Student Loan Marketing Association, the
Federal Home Loan Banks, the Federal Farm Credit Bank or the Federal Home Loan
Mortgage Corporation, or evidences of debt which are fully collateralized by
direct obligations of, and which are issued by, the Government National
Mortgage Association, the Federal National Mortgage Association, the Student
Loan Marketing Association, a Federal Home Loan Bank, the Federal Farm Credit
Bank or the Federal Home Loan Mortgage Corporation;
(b) The total liabilities to the bank or trust company of any
individual, partnership, corporation or limited liability company may equal
but not exceed thirty-five percent of the unimpaired capital of the bank or
trust company; provided, that all of the total liabilities in excess of the
legal loan limit of the bank or trust company as defined in this subdivision
are upon paper based upon the collateral security of warehouse receipts
covering agricultural products or the manufactured or processed derivatives
of agricultural products in public elevators and public warehouses subject to
state supervision and regulation in this state or in any other state of the
United States, under the following conditions: first, that the actual market
value of the property held in store and covered by the receipt shall at all
times exceed by at least fifteen percent the amount loaned upon it; and
second, that the property covered by the receipts shall be insured to the
full market value thereof against loss by fire and lightning, the insurance
policies to be issued by corporations or individuals licensed to do business
by the state in which the property is located, and when the insurance has been
used to the limit that it can be secured, then in corporations or with
individuals licensed to do an insurance business by the state or country of
their incorporation or residence; and all policies covering property on which
the loan is made shall have endorsed thereon, "loss, if any, payable to the
holder of the warehouse receipts"; and provided further, that in arriving at
the amount that may be loaned by any bank or trust company to any individual,
partnership, corporation or limited liability company on elevator or warehouse
receipts there shall be deducted from the thirty-five percent of its
unimpaired capital the total of all other liabilities of the individual,
partnership, corporation or limited liability company to the bank or trust
company;
(c) In computing the total liabilities of any individual to a bank or
trust company there shall be included all liabilities to the bank or trust
company of any partnership of which the individual is a member, and any loans
made for the individual's benefit or for the benefit of the partnership; of
any partnership to a bank or trust company there shall be included all
liabilities of and all loans made for the benefit of the partnership; of any
corporation to a bank or trust company there shall be included all loans made
for the benefit of the corporation and of any limited liability company to a
bank or trust company there shall be included all loans made for the benefit
of the limited liability company;
(d) The purchase or discount of drafts, or bills of exchange drawn in
good faith against actually existing values, shall not be considered as money
borrowed within the meaning of this section; and the purchase or discount of
negotiable or nonnegotiable paper which carries the full recourse endorsements
or guaranty or agreement to repurchase of the person, copartnership,
association, corporation or limited liability company negotiating the same
shall not be considered as money borrowed by the endorser or guarantor or the
repurchaser within the meaning of this section, provided that the files of
the bank or trust company acquiring the paper contain the written
certification by an officer designated for this purpose by its board of
directors that the responsibility of the makers has been evaluated and the
acquiring bank or trust company is relying primarily upon the makers thereof
for the payment of the paper;
(e) For the purpose of this section, a loan guaranteed by an individual
who does not receive the proceeds of the loan shall not be considered a loan
to the guarantor;
(f) Investments in mortgage-related securities, as described in the
Secondary Mortgage Market Enhancement Act of 1984, P.L. 98-440, excluding
those described in subparagraph g. of paragraph (a) of subdivision (1) of
this subsection, shall be subject to the restrictions of this section,
provided that a bank or trust company may invest up to two times its legal
loan limit in any such securities that are rated in one of the two highest
rating categories by at least one nationally recognized statistical rating
organization;
(2) Nor shall any of its directors, officers, agents, or employees,
directly or indirectly purchase or be interested in the purchase of any
certificate of deposit, pass book, promissory note, or other evidence of debt
issued by it, for less than the principal amount of the debt, without
interest, for which it was issued. Every bank or trust company or person
violating the provisions of this subdivision shall forfeit to the state the
face value of the note or other evidence of debt so purchased;
(3) Make any loan or discount on the security of the shares of its own
capital stock, or be the purchaser or holder of these shares, unless the
security or purchase shall be necessary to prevent loss upon a debt
previously contracted in good faith, and stock so purchased or acquired shall
be sold at public or private sale, or otherwise disposed of, within six months
from the time of its purchase or acquisition unless the time is extended by
the finance director. Any bank or trust company violating any of the
provisions of this subdivision shall forfeit to the state the amount of the
loan or purchase;
(4) Knowingly lend, directly or indirectly, any money or property for
the purpose of enabling any person to pay for or hold shares of its stock,
unless the loan is made upon security having an ascertained or market value
of at least fifteen percent more than the amount of the loan. Any bank or
trust company violating the provision of this subdivision shall forfeit to
the state the amount of the loan;
(5) Loans or other extensions of credit to officers and directors shall
be in accordance with Federal Reserve Board Regulation O (12 CFR 215.1, et
seq.). Every bank or trust company or officer thereof knowingly violating
the provisions of this subdivision shall, for each offense, forfeit to the
state the amount of the loan or extension of credit;
(6) Invest or keep invested in the stock of any private corporation,
provided however, a bank or trust company may invest in equity stock in the
Federal Home Loan Bank up to twice the limit described in subdivision (1) of
this subsection and except as otherwise provided in this chapter.
3. Provided, that the provisions in this section shall not be so
construed as in any way to interfere with the rules and regulations of any
clearinghouse association in this state in reference to the daily balances;
and provided, that this section shall not apply to balances due from any
correspondent subject to draft.
4. Provided, that a trust company which does not accept demand deposits
shall be permitted to make loans secured by a first mortgage or deed of trust
on real estate to any individual, partnership, corporation or limited
liability company, and to deal and invest in the interest-bearing obligations
of any state, or any city, county, town, village, or political subdivision
thereof, in an amount not to exceed its unimpaired capital, the loans on real
estate not to exceed sixty-six and two-thirds percent of the appraised value
of the real estate.
5. Any officer, director, agent, clerk, or employee of any bank or trust
company who willfully and knowingly makes or concurs in making any loan,
either directly or indirectly, to any individual, partnership, corporation or
limited liability company or by means of letters of credit, by acceptance of
drafts, or by discount or purchase of notes, bills of exchange or other
obligation of any person, partnership, corporation or limited liability
company, in excess of the amounts set out in this section, shall be deemed
guilty of a class C felony.
6. A trust company in existence on October 15, 1967, or a trust company
incorporated thereafter which does not accept demand deposits, may invest in
but shall not invest or keep invested in the stock of any private corporation
an amount in excess of fifteen percent of the capital and surplus fund of the
trust company; provided, however, that this limitation shall not apply to the
ownership of the capital stock of a safe deposit company as provided in
section 362.105; nor to the ownership by a trust company in existence on
October 15, 1967, or its stockholders of a part or all of the capital stock of
one bank organized under the laws of the United States or of this state, nor
to the ownership of a part or all of the capital of one corporation organized
under the laws of this state for the principal purpose of receiving savings
deposits or issuing debentures or loaning money on real estate or dealing in
or guaranteeing the payment of real estate securities, or investing in other
securities in which trust companies may invest under this chapter; nor to the
continued ownership of stocks lawfully acquired prior to January 1, 1915, and
the prohibition for investments in this subsection shall not apply to
investments otherwise provided by law other than subdivision (4) of
subsection 3 of section 362.105.
7. Any bank or trust company to which the provisions of subsection 2 of
this section apply may continue to make loans pursuant to the provisions of
subsection 2 of this section for up to five years after the appropriate
decennial census indicates that the population of the city in which such bank
or trust company is located has exceeded the limits provided in subsection 2
of this section.
(RSMo 1939 § 7952, A.L. 1941 p. 679, A.L. 1943 p. 944,
A.L. 1945 p. 919, A.L. 1959 H.B. 287, A.L. 1963 p. 450,
A.L. 1967 p. 445, A.L. 1977 S.B. 420, A.L. 1981 S.B.
28, A.L. 1983 S.B. 331, A.L. 1985 H.B. 408, A.L. 1989
H.B. 346, A.L. 1993 H.B. 566, A.L. 1994 S.B. 701, A.L. 1995 S.B.
215, A.L. 2000 S.B. 896, A.L. 2001 H.B. 738 merged with S.B. 186,
A.L. 2002 S.B. 895, A.L. 2003 H.B. 221 merged with S.B. 346, A.L.
2005 H.B. 707)
Prior revisions: 1929 § 5357; 1919 § 11740
*This section was amended by S.B. 491, 2014, effective 1-01-17. Due
to the delayed effective date, both versions of this section are
printed here.
CROSS REFERENCES:
Loans guaranteed under Federal Servicemen's Readjustment Act,
442.120
Ownership of stock or securities of development finance corporation,
371.250
Urban redevelopment corporation bonds, 353.150
Top
Missouri General Assembly
Copyright © Missouri Legislature, all rights reserved.
