§ 288. — Cancellation of stock held by member bank on insolvency or discontinuance of banking operations for sixty days; repayment of cashpaid subscriptions.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 12USC288]
TITLE 12--BANKS AND BANKING
CHAPTER 3--FEDERAL RESERVE SYSTEM
SUBCHAPTER VI--CAPITAL AND STOCK OF FEDERAL RESERVE BANKS; DIVIDENDS AND
EARNINGS
Sec. 288. Cancellation of stock held by member bank on
insolvency or discontinuance of banking operations for sixty
days; repayment of cash-paid subscriptions
If any member bank shall be declared insolvent and a receiver
appointed therefor, the stock held by it in said Federal reserve bank
shall be canceled, without impairment of its liability, and all cash-
paid subscriptions on said stock, with one-half of 1 per centum per
month from the period of last dividend, if earned, not to exceed the
book value thereof, shall be first applied to all debts of the insolvent
member bank to the Federal reserve bank, and the balance, if any, shall
be paid to the receiver of the insolvent bank.
If any national bank which has not gone into liquidation as provided
in section 181 of this title, and for which a receiver has not already
been appointed for other lawful cause, shall discontinue its banking
operations for a period of sixty days the Comptroller of the Currency
may, if he deems it advisable, appoint a receiver for such bank. The
stock held by the said national bank in the Federal reserve bank of its
district shall thereupon be canceled and said national bank shall
receive in payment therefor, under regulations to be prescribed by the
Board of Governors of the Federal Reserve System, a sum equal to its
cash-paid subscriptions on the shares canceled and one-half of 1 per
centum a month from the period of the last dividend, if earned, not to
exceed the book value thereof, less any liability of such national bank
to the Federal reserve bank.
(Dec. 23, 1913, ch. 6, Sec. 6, 38 Stat. 258; Apr. 23, 1930, ch. 207,
Sec. 1, 46 Stat. 250; Aug. 23, 1935, ch. 614, title II, Sec. 203(a),
title III, Sec. 319(b), 49 Stat. 704, 713.)
Amendments
1935--Act Aug. 23, 1935, Sec. 319(b), struck out provision requiring
execution of certificate of reduction of capital stock.
1930--Act Apr. 23, 1930, among other changes, added second par.
Change of Name
Section 203(a) of act Aug. 23, 1935, changed name of Federal Reserve
Board to Board of Governors of the Federal Reserve System.
Exception as to Transfer of Functions
Functions vested by any provision of law in Comptroller of the
Currency, referred to in this section, not included in transfer of
functions to Secretary of the Treasury, see note set out under section 1
of this title.
