6.2-870 - (Effective October 1, 2010) Limitation of amount invested in bank premises.
§ 6.2-870. (Effective October 1, 2010) Limitation of amount invested in bankpremises.
A. No bank, without the approval of the Commission, shall invest in its bankbuilding and premises, property held for future accommodation, or in stock orother obligations of any corporation holding title to premises of the bank,if the aggregate of such investments and loans, together with the amount ofany indebtedness of such corporation, 50 percent or more of the stock ofwhich is owned by the bank, will exceed the greater of (i) 50 percent of thecapital stock, surplus, and undivided profits of the bank or (ii) 100 percentof the capital stock of the bank. If, subsequent to any investment or loan,the surplus or undivided profits of any such bank are diminished by losses sothat the investments or loans amount to more than the greater of (a) 50percent of its paid-in capital stock and its remaining surplus and undividedprofits or (b) 100 percent of the capital stock, the bank shall not paydividends without the permission of the Commission until such investments orloans are equal to or less than the greater of 50 percent of the capitalstock, surplus, and undivided profits, or 100 percent of the capital stock ofthe bank.
B. In computing the bank's investment in depreciable property, the initialprice or cost may be reduced by reasonable depreciation.
C. The Commission shall not in any event approve investments and loans inexcess of the foregoing if the aggregate amount thereof would exceed 60percent of the bank's capital stock, surplus, and undivided profits. TheCommission in approving such excess investments may impose, as a condition ofsuch approval, restrictions upon dividends or other restrictions upon thebank. The restrictions shall expire automatically when the investment of thebank in building premises shall no longer exceed the greater of (i) 50percent of the capital stock, surplus, and undivided profits of the bank or(ii) 100 percent of the capital stock.
(Code 1950, § 6-49; 1966, c. 584, § 6.1-57; 1968, c. 61; 2010, c. 794.)