A. The board of directors shall meet at least once each calendar quarter. The director may, at his discretion, require more frequent meetings. The director of the division, a board member or an executive officer may call a special meeting. A majority of the board shall constitute a quorum. The board shall keep minutes of each meeting, including a record of attendance and of all votes cast.
B. The board of directors or an executive committee of not less than one-third of the board shall review, at least quarterly, the following transactions that have occurred since the last review:
(1) each loan, advance, discount, overdraft and purchase or sale of a security that exceeds in amount one-tenth of one percent of the capital and surplus of the corporation or twenty-five thousand dollars ($25,000), whichever is larger; and
(2) every increase in loans, advances, discounts and overdrafts that exceeds the amount specified in Paragraph (1) of this subsection or with the increase will exceed it and every purchase or sale of a security that, together with other such transactions in the security during the preceding three months, involves that amount.
C. The board of directors shall examine, at least once in each calendar year at intervals of not more than fifteen months, all the affairs of the state bank, including the character and value of investments and loans and the efficiency of operating procedures. A report of the examination shall be submitted to the director of the division promptly. The board may provide that the examination shall be conducted by a committee of not less than three directors or may employ the services of qualified examiners or certified public accountants approved by the director of the division. The examination shall be conducted in accordance with generally accepted auditing procedures or in accordance with regulations of the director of the division.
D. In lieu of the director's examination required by Subsection C of this section, the board of directors of a state bank may submit to the director of the division at least once each calendar year at intervals of not more than fifteen months a certified audit report for the bank. The examination shall be conducted by a certified public accountant in accordance with generally accepted auditing procedures. The director of the division may require the board of directors of a bank submitting a certified audit examination in lieu of a directors' examination to submit such other information as the director of the division deems necessary, including information relating to the character and value of investments and loans and the efficiency of operating procedures of the bank.
E. A state bank authorized to exercise trust powers shall not accept or voluntarily relinquish a fiduciary account without the approval or ratification of the board of directors or of a committee of officers or directors designated by the board to perform this function, but the board or the committee may prescribe general rules governing acceptance or relinquishment of fiduciary accounts, and action taken by an officer in accordance with these rules is sufficient approval. Any committee so designated shall keep minutes of its meetings and report at each monthly meeting of the board all action taken since the previous meeting of the board. The board shall designate one or more committees of not less than three qualified officers or directors to supervise the investment of fiduciary funds. No such investment shall be made, retained or disposed of without the approval of a committee. At least once in every calendar year at intervals of not more than fifteen months, the committee shall review all the assets of each fiduciary account and shall determine their current value, safety and suitability and whether the investments should be modified or retained. The committee shall keep minutes of its meetings and shall report at each monthly meeting of the board its conclusions on all questions considered and all action taken since the previous meeting of the board.
History: 1953 Comp., § 48-22-54, enacted by Laws 1963, ch. 305, § 54; 1975, ch. 330, § 36; 1981, ch. 196, § 1; 1995, ch. 190, § 11.
Cross references. — For meaning of director of the division, see 58-1-3, 9-16-4 and 9-16-7 NMSA 1978.
The 1995 amendment, effective June 16, 1995, substituted "each calendar quarter" for "every month" at the end of the first sentence, added the second sentence, substituted "board member" for "director" in the third sentence, substituted "quarterly" for "monthly" in the introductory paragraph of Subsection B; in Paragraph (2) of Subsection B, substituted "that exceeds the amount specified in Paragraph (1) of this subsection" for "which exceed this amount", "three" for "two" and made minor stylistic changes; and substituted "director of the division" for "director of the financial institutions division" and "board" for "board of directors" throughout the section.
Am. Jur. 2d, A.L.R. and C.J.S. references. — 10 Am. Jur. 2d Banks § 100.
9 C.J.S. Banks and Banking § 98.
Structure New Mexico Statutes
Chapter 58 - Financial Institutions and Regulations
Section 58-1-2 - Definitions of banks.
Section 58-1-2.1 - Prohibition.
Section 58-1-4 - Effect on existing banks.
Section 58-1-5 - Deposit of minor; school or institutional deposits.
Section 58-1-6 - Designating agent.
Section 58-1-7 - Adverse claim to deposit.
Section 58-1-8 - Payment from account when no executor or administrator has qualified.
Section 58-1-9 - Transmitting money; foreign exchange.
Section 58-1-10 - Authority to engage in leasing safe deposit facilities; subsidiary company.
Section 58-1-11 - Access by fiduciaries.
Section 58-1-12 - Effect of lessee's death or incapacity.
Section 58-1-13 - Lease to minor.
Section 58-1-14 - Search procedure on death.
Section 58-1-15 - Adverse claims to contents of safe deposit box.
Section 58-1-16 - Special remedies for nonpayment of rent.
Section 58-1-17 - Qualification and fiduciary powers.
Section 58-1-18 - Fiduciary bond or oath excused.
Section 58-1-20 - Reserves against deposits.
Section 58-1-22 - Investments.
Section 58-1-23 - Acceptances.
Section 58-1-24 - Diversification of loans and investments.
Section 58-1-25 - Acquisition of property to satisfy or protect previous loan.
Section 58-1-26 - Acquisition of banking premises and equipment.
Section 58-1-27 - Sale of assets in ordinary course.
Section 58-1-29 - Issuance of capital debentures or notes.
Section 58-1-30 - Pledge of assets.
Section 58-1-31 - Endorsement and signature guaranty and unauthorized assumption of liability.
Section 58-1-33 - Oath of secrecy; surety bonds.
Section 58-1-34 - Powers of director.
Section 58-1-35 - Employees [Examiners] and clerks; designation of deputy.
Section 58-1-36 - Seal of the director.
Section 58-1-37 - Office of the commissioner [director]; delegation of powers.
Section 58-1-39 - Bank records; prescribing manner of keeping.
Section 58-1-40 - Reports of condition; special reports; failure to make; penalty.
Section 58-1-41 - Supervision fees.
Section 58-1-41.1 - Trust department examination; fees.
Section 58-1-41.2 - Additional examinations.
Section 58-1-43 - Fees and penalties; disposition.
Section 58-1-44 - Copies of reports and records; evidence; fees.
Section 58-1-45 - Court review.
Section 58-1-46 - Examinations and reports.
Section 58-1-47 - Commissioner's [Director's] annual report.
Section 58-1-48 - Records of division.
Section 58-1-50 - Limitation of personal liability.
Section 58-1-51 - Standards in regulations.
Section 58-1-52 - Incorporators.
Section 58-1-53 - General corporate powers.
Section 58-1-54 - Powers of director and of state banks.
Section 58-1-55 - Capital structure; impairment of capital.
Section 58-1-56 - Notice of intention.
Section 58-1-57 - Application for permission to file corporate papers.
Section 58-1-59 - Subscription calls.
Section 58-1-65 - Directors and officers.
Section 58-1-66 - Directors; meetings and duties.
Section 58-1-67 - Fidelity bonds and other insurance.
Section 58-1-68 - Authority to declare dividends.
Section 58-1-69 - Capital, surplus and undivided profits; accounting requirements.
Section 58-1-70 - Deposit insurance; membership in federal reserve system.
Section 58-1-71 - Waivers; corporate action by unanimously signed writing.
Section 58-1-72 - Voluntary liquidation and dissolution.
Section 58-1-73 - Director in possession.
Section 58-1-74 - Requirements of reorganization plan.
Section 58-1-75 - Liquidation by commissioner [director].
Section 58-1-76 - Unauthorized conduct of banking business.
Section 58-1-77 - Receipt of deposits while insolvent.
Section 58-1-78 - Unlawful service as officer or director.
Section 58-1-80 - Unlawful concealment of transaction.
Section 58-1-81 - Improper maintenance of accounts; false or deceptive entries and statements.
Section 58-1-82 - Reimbursement for fines and penalties.
Section 58-1-83 - Unlawful use of words "safe deposit.".
Section 58-1-84 - Unlawful sanctions; violations of rules and orders.