32-1-502. Grounds for closing bank. (1) When it appears to the department that:
(a) a bank has willfully violated its charter or a law of this state;
(b) a bank has willfully violated a general rule of the department, made in accordance with law;
(c) the capital of a bank is impaired or for any reason is below the amount required by law and has not been made good after notice, as provided by law, or, without that notice, in the event a majority of the board of directors of the bank notifies the department in writing that the impairment cannot be made good;
(d) a bank cannot meet or has failed to meet its liabilities as they become due in the regular course of business;
(e) a bank's reserve has fallen below the amount required by law and it has failed to make good that reserve within 30 days after being requested to do so by the department or, without that notice, if a majority of the directors, in writing, notifies the department that the reserve cannot be made good within 30 days or if it is continually allowing its reserve to fall below the required amount;
(f) a bank is conducting business in an unsafe and unauthorized manner or is in an unsafe or unsound condition;
(g) a bank refused to submit its papers, books, and concerns to the inspection of the department; or
(h) an officer of a bank has refused to be examined under oath regarding the affairs, business, or concerns of any bank insofar as they relate to solvency or matters having to do with the supervision by the department; then the department may, in its discretion, close the bank and take possession of all the books, records, assets, and business of every description of the bank and hold them and retain possession of them until the bank is authorized by the department to resume business or its affairs are liquidated as provided in this chapter, and it shall do so in cases where a bank comes into its possession voluntarily or in the manner provided by law.
(2) The powers and authority conferred on the department by this section, except in cases of voluntary surrender, are discretionary and not mandatory. As long as the department acts in good faith, the department and its employees and agents may not be held liable civilly or criminally or upon their official bonds for action taken under this section or for any failure to act under it.
History: En. Sec. 121, Ch. 89, L. 1927; re-en. Sec. 6014.131, R.C.M. 1935; amd. Sec. 43, Ch. 431, L. 1975; R.C.M. 1947, 5-1101.
Structure Montana Code Annotated
Title 32. Financial Institutions
Chapter 1. Banks and Trust Companies
Part 5. Dissolution, Closing, and Liquidation
32-1-501. Dissolution and disincorporation
32-1-502. Grounds for closing bank
32-1-504. Deposits in insolvent bank
32-1-505. Penalty for receiving deposits when insolvent or for making false statements
32-1-506. Assessment on capital stock to make good impairment
32-1-507. Power of closed banks to borrow money from governmental agencies
32-1-508. Corporate existence -- ceases when
32-1-509. Taxes on banks which have ceased to do business
32-1-510. Penalty for maliciously declaring bank insolvent
32-1-511. Bank may be placed in department's possession
32-1-512. Effect of posting notice
32-1-513. Taking possession of bank -- notice
32-1-514. Resumption after closing
32-1-515. Powers of department on closing bank -- court proceedings
32-1-516. Recourse of aggrieved bank -- injunction
32-1-517. Department may retain bank employees -- liquidating agent's salary and expenses
32-1-518. Compensation of agents and attorneys
32-1-519. through 32-1-530 reserved
32-1-531. Notice to creditors of insolvent bank
32-1-532. Claims -- allowance and rejection
32-1-534. Claims -- order of payment -- priorities
32-1-535. Claims -- partial payments -- assignments
32-1-536. Deposit of funds in department's hands
32-1-537. Disposition of unclaimed funds
32-1-538. Disposition of assets remaining after payment of claims
32-1-539. through 32-1-550 reserved
32-1-551. Liquidating officer's powers and duties
32-1-552. Further duties of liquidating officer
32-1-553. Department to file inventory -- report required -- exception
32-1-554. through 32-1-560 reserved