S.B. 404 Senate Bill No. 404--Committee on Commerce and Labor (Requested by Nevada Bankers' Association) April 26, 1995 _____________ Referred to Committee on Judiciary SUMMARY--Provides for organization of banks as limited-liability companies. (BDR 55-355) FISCAL NOTE: Effect on Local Government: No. Effect on the State or on Industrial Insurance: No. EXPLANATION--Matter in italics is new; matter in bra ckets [ ] is material to be omitted. AN ACT relating to banks; authorizing the organization of a bank as a limited-liability company; providing an exception to the restrictions on payment of dividends or making of distributions; and providing other matters properly relating thereto. THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS: Section 1. NRS 657.016 is hereby amended to read as follows: 657.016 "Bank," "commercial [bank"] \bank," "banking company"\\ or "banking corporation" refers to corporations [,] \or limited-liability companies,\\ whether chartered by the state or [Federal Government,] \the United States,\\ conducting the business of receiving money as demand deposits or otherwise carrying on a banking or banking and trust business. Sec. 2. NRS 657.075 is hereby amended to read as follows: 657.075 "Surplus" means a fund created pursuant to the provisions of this Title by a bank from payments by stockholders \or members\\ or from the bank's net earnings or undivided profits which, to the amount specified and by any additions thereto set apart and designated as such, is not available for the payment of dividends and cannot be used for the payment of expenses or losses while [such] \the\\ bank has undivided profits. Sec. 3. NRS 657.095 is hereby amended to read as follows: 657.095 All provisions of [chapter 78] \chapters 78 and 86\\ of NRS not in conflict with this Title are hereby adopted as a part of this Title. Sec. 4. NRS 657.105 is hereby amended to read as follows: 657.105 1. The powers, privileges, duties and restrictions conferred and imposed upon any corporation, \company,\\ association or [individual,] \natural person,\\ existing and doing business under the laws of this state, are hereby abridged, enlarged or modified, as each particular case may require, to conform to the provisions of this Title, notwithstanding anything to the contrary in its respective articles of incorporation \, articles of organization\\ or charter. 2. As used in this section, "doing business under the laws of this state" does not include the lending of money to a person who is not a resident of this state, whether or not the bank which extended the credit or serviced the loan is located in this state. Sec. 5. NRS 658.115 is hereby amended to read as follows: 658.115 1. The commissioner shall make summary orders in writing as provided in subsections 2 to 5, inclusive. 2. [Whenever any banking corporation,] \If a bank,\\ a member of its board of directors or any \manager,\\ officer, employee \, member\\ or stockholder [of the corporation violates the corporation's charter] \violates the bank's articles of incorporation or organization\\ or any law related to banking, or, in the opinion of the commissioner, is conducting its business in an unauthorized or unsafe manner, the commissioner shall forthwith issue an order, in writing, directing the discontinuance of the unauthorized or unsafe practices. 3. [Whenever] \If\\ it appears to the commissioner that the capital stock \or total contributions\\ of any bank has been reduced in value below the requirements of law, or of its [certificate] \articles\\ of incorporation [,] \or organization,\\ he shall forthwith issue an order directing that the bank make good the deficiency forthwith or within a time specified in the order. 4. [Whenever] \If\\ it appears to the commissioner that either the total reserves or reserves on hand of any bank are below the amount required by law to be maintained, or that a bank is not keeping its reserves on hand as required by this Title, he shall forthwith issue an order directing that the bank make good its reserves forthwith, or within the time specified within the order, or that it keep its reserves on hand as required by this Title. 5. [Whenever] \If\\ it appears to the commissioner that any bank to which this Title is applicable does not keep its books or accounts in such a manner as to enable the commissioner readily to ascertain its true condition, he shall issue an order requiring the bank, or the officers \or managers\\ thereof, or any of them, to open and keep its books or accounts as he may, in his discretion, determine and prescribe for the purpose of keeping accurate and convenient records of the transactions and accounts of the bank. Sec. 6. NRS 659.015 is hereby amended to read as follows: 659.015 Any number of persons, not [less] \fewer\\ than three, who [may be desirous of forming a bank and engaging] \desire to form a bank and engage\\ in the business of establishing, maintaining and operating banks of discount and deposit, savings, time and demand deposits, or [engaging] in the business of establishing, maintaining and operating offices of loan and deposits, or [operating banks engaged in] \to operate a bank\\ doing a trust and fiduciary business, shall [be incorporated] \organize\\ as a banking corporation \or company\\ in the manner provided in this Title. Sec. 7. NRS 659.025 is hereby amended to read as follows: 659.025 The articles of incorporation [shall] \or organization must\\ set forth: 1. The name of the corporation [. No name shall] \or limited-liability company. No name may\\ be used which is already in use by another [existing] corporation \or company\\ organized under the laws of this state or of the [Congress,] \United States,\\ or so nearly similar thereto as to lead to uncertainty or confusion. 2. The location of its principal office in this state. 3. The nature of its business. 4. The names and post office addresses of subscribers for stock [,] \or initial members of the company,\\ and the number of shares subscribed \or the amount contributed\\ by each. The aggregate of [such subscriptions shall be] \the subscriptions or contributions is\\ the amount of the capital with which the bank will commence business. 5. The period, if any, limited for the duration of the banking corporation [.] \or company.\\ Sec. 8. NRS 659.035 is hereby amended to read as follows: 659.035 1. The articles of incorporation \or organization\\ must be signed by [the original incorporators, or] a majority of [them, and] \the persons originally organizing the bank,\\ must be proved or acknowledged before a person authorized under the laws of this state to take proof or acknowledgment of deeds, and must be [filed in the office of] \delivered to\\ the secretary of state [.] \for filing.\\ 2. The secretary of state shall forthwith transmit to the commissioner a copy of the articles [of incorporation,] and shall not [issue a corporation charter certificate or record the articles of incorporation] \file the articles\\ until authorized to do so by the commissioner \.\\ [as provided in NRS 659.065.] Sec. 9. NRS 659.045 is hereby amended to read as follows: 659.045 1. Upon receipt of a copy of the articles of incorporation \or organization\\ of the proposed bank, the commissioner shall at once examine into all of the facts connected with the formation of the proposed banking corporation [,] \or company,\\ including its location and proposed stockholders [.] \or members.\\ If it appears that the [corporation,] \bank,\\ if formed, will be lawfully entitled to commence the business of banking, the commissioner shall so certify to the secretary of state, unless upon examination and investigation he finds that: (a) The proposed [corporation] \bank\\ is formed for any other than legitimate banking business; (b) The character, general fitness and responsibility of the persons proposed as stockholders, directors, officers [and other managerial officials of the corporation] \, members or managers of the bank\\ are not such as to command the confidence of the community in which the bank is proposed to be located; (c) The probable volume of business and reasonable public demand in such community is not sufficient to assure and maintain the solvency of the new bank and of the then existing bank or banks in the community; (d) The name of the proposed [corporation] \banking corporation or company\\ is likely to mislead the public as to its character or purpose; or (e) The proposed name is the same as the one already adopted or appropriated by an existing bank in this state, or so similar thereto as to be likely to mislead the public. 2. The commissioner shall not make the certification to the secretary of state until he has ascertained that the establishment of the bank will meet the needs and promote the convenience of the community to be served by the bank. 3. A nonrefundable fee of $3,000 for the application and survey must be submitted to the commissioner at the time the articles [of incorporation] are filed with the secretary of state. The proposed banking corporation \or company\\ shall also pay such additional expenses incurred in the process of investigation as the commissioner deems necessary. All money received by the commissioner pursuant to this section must be placed in the investigative account created by NRS 232.545. Sec. 10. NRS 659.065 is hereby amended to read as follows: 659.065 1. Upon receipt of the certification from the commissioner, the secretary of state shall, if the articles of incorporation \or organization\\ are in accordance with law, [issue] \file\\ the articles and cause them to be recorded in his office. The secretary of state shall, upon the payment of the organization fees, certify under his official seal two copies of the articles \.\\ [of incorporation.] One copy must forthwith be filed in the office of the county clerk of the county where the principal office of the [banking corporation] \bank\\ in this state is to be located. The other certified copy must be filed in the office of the commissioner. 2. Upon completion of the requirements of subsection 1, the banking corporation [must be] \or company is\\ legally constituted [a corporation] under the name stated in the articles \.\\ [of incorporation.] 3. The articles \,\\ [of incorporation,] or a copy thereof, certified by the secretary of state or the county clerk of the county in which [such] \the\\ articles are recorded, or by the commissioner, under their respective seals, [must be] \are admissible as\\ evidence in all courts and places, and [must,] \are,\\ in all judicial proceedings, [be] prima facie evidence of the complete organization and incorporation of the banking corporation purporting thereby to have been established. 4. The [corporation charter certificate of any bank is void if such] \articles of a bank become void if the\\ bank fails to complete its organization and open for business to the public within 6 months after the date of \the\\ filing \of\\ its articles [of incorporation with] \by\\ the secretary of state. The commissioner may extend [such 6-month] \this\\ limitation for good cause. Sec. 11. NRS 659.075 is hereby amended to read as follows: 659.075 1. Subject to subsection 2, the capital stock \, or contributions,\\ of every bank must be fully paid in, in cash, before it is authorized by the commissioner to commence business. The full payment in cash [of the capital stock] must be certified to the commissioner under oath by the president [and] \or manager and the\\ cashier of the bank. 2. Except for any commission or fee not otherwise prohibited by this subsection, the stock sold by \or contributions to\\ any bank in process of organization, or for an increase of [the capital stock,] \capital,\\ must be accounted for to the bank in the full amount paid \.\\ [for it.] No commission or fee may be paid to any person, association or corporation for selling stock [by] \of or soliciting contributions to\\ any bank in process of organization. The commissioner shall refuse such a bank the authority to commence business if commissions or fees have been paid, or have been contracted to be paid by the bank, or by anyone in its behalf, to any person, association or corporation for securing subscriptions for or selling stock in \, or procuring contributions to,\\ the bank. Sec. 12. NRS 659.085 is hereby amended to read as follows: 659.085 Before the banking corporation \or company\\ begins [the business of banking, banking and trust or fiduciary] business, it shall file with the commissioner: 1. A statement under oath by the president \, a manager\\ or \the\\ cashier, containing the names of all the directors \, managers\\ and officers, with the date of their election or appointment, terms of office, residences and post office address of each, the amount of capital stock of which each is the owner in good faith and the amount of money paid in on account of the capital stock [.] \, or the contribution made.\\ Nothing may be received in payment of capital stock \or contribution\\ but money. 2. Proof that the bank is a member of the Federal Deposit Insurance Corporation. Sec. 13. NRS 659.095 is hereby amended to read as follows: 659.095 1. Upon filing of the statement and proof by the banking corporation \or company\\ as required by NRS 659.085, the commissioner shall examine into its affairs, ascertain especially the amount of money paid in on account of its capital, the name and place of residence of each director, the amount of capital stock of which each is the owner in good faith [,] \or the amount of his contribution,\\ and whether the banking corporation \or company\\ has complied with all the provisions of law required to entitle it to engage in business. 2. If upon the examination the commissioner finds that the banking corporation \or company\\ is lawfully entitled to commence [the business of banking, banking and trust or fiduciary] business, he shall give to [such banking corporation] \it\\ a certificate signed by the commissioner that [the corporation] \it\\ has complied with all the provisions of [the] law required [,] before commencing [the business of banking,] \business,\\ and that [the corporation] \it\\ is authorized to commence business. Sec. 14. NRS 659.105 is hereby amended to read as follows: 659.105 No banking corporation \or company\\ may transact any business except such as is incidental and necessarily preliminary to its organization until it has been authorized to do so by the commissioner. Sec. 15. NRS 659.115 is hereby amended to read as follows: 659.115 1. No [corporation,] \person,\\ except a bank maintaining an office in this state and doing business under the laws of the United States, may solicit or accept deposits in this state or otherwise engage in the banking business in this state without first obtaining from the commissioner, as provided in this section, a license authorizing [the] \it, as a banking\\ corporation \or company,\\ to use the name and transact the business of a bank. The transacting of any banking business without such authority is a gross misdemeanor. 2. For the purposes of this section "solicits deposits" has the meaning ascribed to it in NRS 80.016. Sec. 16. NRS 659.125 is hereby amended to read as follows: 659.125 1. A corporation [must not be chartered] \or limited-liability company may not be organized\\ under the laws of this state with the words "bank" or "banking" as part of its name except corporations \or companies\\ subject to regulation pursuant to chapters 657 to 668, inclusive, of NRS, or corporations under the regulation of the commissioner of insurance. A corporate \or company\\ name must not be amended to include the words "bank" or "banking" unless the corporation \or company\\ is under such regulation. 2. Except as otherwise provided in subsections 3 and 4, a natural person, association, firm or corporation domiciled within this state, except a national bank or a banking corporation subject to regulation pursuant to chapters 657 to 668, inclusive, of NRS, or under the regulation of the commissioner of insurance, may not advertise or put forth any sign as bank, banking or banker or use the word "bank," "banking" or "banker" as part of its name and title. 3. A savings and loan association subject to the provisions of chapter 673 of NRS may use the words "savings bank" or "bank" as part of its name and title if the use of those words is permitted by the Federal Home Loan Bank Board. 4. A thrift company subject to the provisions of chapter 677 of NRS may use the words "savings bank" as part of its name if its deposits are federally insured. 5. Any person who violates any of the provisions of this section shall be fined not more than $500 for each offense. Sec. 17. NRS 661.035 is hereby amended to read as follows: 661.035 1. A banking corporation \or company\\ doing business under the provisions of this Title may increase its capital [stock as provided] \as permitted\\ by law for other corporations [.] \or companies.\\ 2. A [bank] \banking corporation\\ may, with the approval of the commissioner and by the vote of the holders of at least two-thirds of the stock of the particular class or classes of stock entitled to vote on [such] \the\\ proposal, amend its [charter] \articles of incorporation\\ to authorize an increase in [the] \its\\ authorized but unissued common stock \.\\ [of the bank.] Any such authorized increase of stock must be free from preemptive rights. 3. The authorized but unissued stock may be issued from time to time to \its\\ officers or employees [of the bank] pursuant to a stock option or stock purchase plan adopted in accordance with this Title. Sec. 18. NRS 661.046 is hereby amended to read as follows: 661.046 1. Except as \otherwise\\ provided in subsection 2, a corporation \or limited-liability company\\ doing business under the provisions of this Title may reduce its capital stock in the manner [provided] \permitted\\ for other corporations \or companies\\ upon a vote in favor of the decrease of two- thirds in interest of each class of stockholders with voting powers [.] \or two-thirds in interest of its members.\\ 2. No bank may reduce its capital [stock] to an amount less than the minimum required by law. The reduction is not valid or does not warrant the cancellation of stock certificates until it has been approved by the commissioner. The approval must not be given except upon a finding by the commissioner that the security of existing creditors of the corporation \or company\\ will not be impaired. Sec. 19. NRS 661.055 is hereby amended to read as follows: 661.055 The common stockholders of any [bank] \banking corporation\\ organized after July 1, 1971, \or banking company organized on or after October 1, 1995,\\ under the laws of the State of Nevada shall pay [in,] \into,\\ in cash, a surplus fund equal to 20 percent of its [common capital stock] \capital\\ before the bank is authorized to commence business. Sec. 20. NRS 661.065 is hereby amended to read as follows: 661.065 Persons holding stock \in banking corporations or becoming substituted members of banking companies\\ as executors, administrators, guardians or trustees [shall] \are\\ not personally [be] subject to any liabilities as stockholders [,] \or members,\\ but the estates and funds in their hands [shall be] \are\\ liable in like manner and to the same extent as the testator, [testate,] \intestate,\\ ward or person interested in [such] \the\\ trust fund would be, if living and competent to hold stock in his own name. Sec. 21. NRS 661.075 is hereby amended to read as follows: 661.075 1. [Whenever any stockholder, or his assignee,] \If a stockholder of a banking corporation or member of a banking company\\ fails to pay any installment on [the] \his\\ stock \or contribution\\ when [such] \the\\ installment is required by law to be paid, the directors \or managers\\ of the bank shall sell the stock [of such delinquent stockholder] \or member's interest\\ at public or private sale, as they may deem best, having first given the delinquent stockholder \or member\\ 20 days' notice, personally or by mail, at his last known address. 2. If no person can be found who will pay for [such] \the\\ stock \or interest\\ the amount due thereon, together with any additional indebtedness of the stockholder \or member\\ to the bank, the amount previously paid [shall be] \is\\ forfeited to the bank. [Such stock shall] \The stock or interest must\\ be sold, as the directors may order, within 30 days [of the time of such] \after the\\ forfeiture and, if not sold, it [shall] \must\\ be canceled and deducted from the capital [stock] of the bank. \3. The other members of a banking company have a joint and several right of first refusal to buy the interest of the delinquent member. If this right is not exercised, the buyer becomes a member. \\Sec. 22. NRS 661.085 is hereby amended to read as follows: 661.085 1. If the capital of any bank has become impaired and the surplus and undivided profits of that bank are insufficient to make the impairment good, the commissioner shall notify the bank to make the impairment good within 60 days [of] \after\\ the notice by an assessment upon the stockholders \or members\\ of the bank. 2. The officers and directors of the bank receiving the notice shall immediately call a special meeting of the stockholders for the purpose of making an assessment upon its stockholders \, or the managers shall make an assessment upon the members,\\ payable in cash sufficient to cover the impairment of the capital. The assessment must be made [at that meeting] unless the capital of the bank is reduced to the extent of the impairment as provided in NRS 661.046. 3. If any stockholder [of the bank] \or member\\ neglects or refuses to pay the required assessment, the board of directors \or the managers\\ shall, to make good the deficiency, cause a sufficient amount of the capital stock of the stockholder or [stockholders] \interest of the member\\ to be sold at public auction, upon 30 days' notice. The notice must be given by posting a notice of the sale in the office of the bank and by publishing the notice in a newspaper in the place where the bank is located, or if there is no newspaper there, then in a newspaper circulating in the county in which the bank is located. The balance, if any, over and above the deficiency, must be returned to the delinquent shareholder or [shareholders.] \member.\\ 4. If, within 3 months after receiving notice from the commissioner, the bank fails to make good the deficiency in its capital \,\\ [stock,] the commissioner may forthwith take possession of the property and business of the bank until its affairs are finally liquidated as provided by law. 5. A sale of stock as provided in this section effects an absolute cancellation of any outstanding certificate or certificates evidencing the stock so sold, and the certificate is void. A new certificate must be issued by the bank to the purchaser of any stock for which an outstanding certificate was canceled. \6. The other members of a banking company have the same right of first refusal, and the consequences of not exercising it are the same, as provided in NRS 661.075. \\Sec. 23. NRS 661.095 is hereby amended to read as follows: 661.095 [The holders] \A holder\\ of capital stock of any corporation organized under the provisions of this Title, after [they have] \he has\\ fully paid therefor, [shall be under no stockholder's] \and a member of a limited-liability company so organized, after he has paid his contribution in full, is under no\\ liability to the creditors of [such corporation;] \the bank,\\ but where the capital stock of any bank has been impaired, an assessment upon the stockholders [as] \in the manner\\ provided in NRS 661.085 may be levied to make [such] \the\\ impairment good, and the stock of any shareholder \or the interest of any member\\ of [such] \the\\ bank may be sold [as] \in the manner\\ provided in NRS 661.085, if the assessment is not paid. Sec. 24. NRS 661.115 is hereby amended to read as follows: 661.115 1. The president and cashier \, or the managers,\\ of every bank shall cause to be kept at all times in the banking room where the bank's business is transacted, a full and correct list of the names and places of residence of its stockholders, and the number of shares held by each. 2. [The list must be open to the inspection of the officers authorized to assess taxes under state authority during the business hours of each day in which business may be legally transacted. 3.] On the [1st] \first\\ Monday in January of each year, a copy of the list, verified by the oath of the president or cashier, \or a manager,\\ must be transmitted to the commissioner and must be filed in his office for the confidential use of the commissioner. Sec. 25. NRS 661.125 is hereby amended to read as follows: 661.125 1. As used in this section, "control" means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policy of the bank, or a change in the ownership of as much as 25 percent of the outstanding voting stock \of or members' interests\\ in any bank. 2. If there is a change in ownership of 5 percent or more of the outstanding voting stock of \or members' interests in\\ any bank, the president or other chief executive officer of the bank shall report the facts to the commissioner within 24 hours after obtaining knowledge of the change. 3. [Whenever] \If\\ a loan or loans are made by a bank, [which] \and the\\ loan or loans are, or are to be, secured by 10 percent or more of the voting stock of \or members' interests in\\ a Nevada bank, the president or other chief executive officer of the bank which makes the loan or loans shall report that fact to the commissioner within 24 hours after obtaining knowledge of the loan or loans, except when the borrower has been the owner of record of the stock for 1 year or more, or the stock is of a newly organized bank before its opening. 4. The reports required in subsections 2 and 3 [must be] \are\\ in addition to any reports required by any other law and must contain whatever information is available to inform the commissioner of the effect of the transaction upon control of the bank whose stock [is] \or members' interests are\\ involved, and must contain, when known by the person making the report: (a) The number of shares \or members' interests\\ involved; (b) The identity of the sellers or transferors and purchasers or transferees of record; (c) The identity of the beneficial owners of the shares \or members' interests\\ involved; (d) The purchase price; (e) The total number of shares \or members' interests\\ owned by the sellers or transferors and purchasers or transferees of record, both immediately before and after the transaction being reported; (f) The total number of shares \or members' interests\\ owned by the beneficial owners of the shares \or members' interests\\ involved, both immediately before and after the transaction being reported; (g) The identity of borrowers; (h) The name of the bank issuing the stock securing \, or whose members' interests secure,\\ the loan; and (i) The number of shares \or members' interests\\ securing the loan and the amount of the loan or loans. 5. Each bank shall report to the commissioner within 24 hours any changes in chief executive officers or directors, including in its report a statement of the past and current business and professional affiliations of new chief executive officers or directors. Any new chief executive officer shall furnish to the commissioner a complete financial statement as may be required by the commissioner. 6. An application pursuant to NRS 659.045 must be submitted to the commissioner by the person who acquires stock \or members' interests\\ resulting in a change of control of the bank. Except as otherwise provided in subsection 8, the commissioner shall conduct an investigation to determine whether the character, general fitness and responsibility of the applicant is such as to command the confidence of the community in which the bank is located. 7. The bank with which the applicant is affiliated shall pay such a portion of the cost of the investigation as the commissioner requires. All money received by the commissioner pursuant to this subsection must be placed in the investigative account created by NRS 232.545. If the commissioner denies the application, he may forbid the applicant from participating in the business of the bank. 8. A bank may submit a written request to the commissioner to waive an investigation pursuant to subsection 6. The commissioner may grant a waiver if the applicant has undergone a similar investigation by a state or federal agency in connection with the licensing of or his employment with a financial institution. \9. As used in this section, "chief executive officer" includes a manager of a limited-liability company. \\Sec. 26. NRS 661.135 is hereby amended to read as follows: 661.135 \1. \\The affairs and business of [any] \a\\ banking corporation organized under the laws of this state must be managed or controlled by a board of directors of not less than five in number, who must be selected from the stockholders at the annual meeting of stockholders in such manner as may be provided by the bylaws of the corporation. \2. The affairs and business of a banking company so organized must be managed or controlled by no fewer than three managers selected from the members as provided in the operating agreement. \\Sec. 27. NRS 661.145 is hereby amended to read as follows: 661.145 1. No person is eligible to serve as a director \or manager\\ of any bank, organized or existing under the laws of this state, unless he is a bona fide owner of stock of the bank or its bank holding company [.] \, or has a member's interest in the bank.\\ The stock \or interest\\ owned must have a total fair market value of at least $1,000. A determination of the value of the stock \or interest\\ must be based on its value on the date it was purchased or on its value on the date the [person] \owner\\ became a director, whichever is greater. The stock \or the member's contribution\\ must be fully paid and not pledged. 2. A majority of the board of directors \or managers\\ of every bank must be residents of the State of Nevada, and at least one of the directors \or managers\\ must reside in the county where its principal place of business is to be conducted. 3. For the purposes of this section, "bank holding company" has the meaning ascribed to it in NRS 666.065. Sec. 28. NRS 661.155 is hereby amended to read as follows: 661.155 1. A director [,] \or manager,\\ when selected, shall take an oath that: (a) He will, so far as the duty devolves upon him, diligently and honestly administer the affairs of a bank, and will not knowingly violate, or willingly permit to be violated, any of the provisions of this Title. (b) He is the owner, in good faith and in his own right, of the number of shares of stock \, or the members' interest,\\ required by this Title standing in his name on the books of the [corporation,] \bank,\\ and that [they are] \the stock or interest is\\ not hypothecated or in any way pledged as security for any loan or debt. 2. The oath, subscribed by the director \or manager\\ making it and certified by the notary public before whom it was taken, [shall] \must\\ be immediately transmitted to the commissioner and must be filed and preserved in his office. Sec. 29. NRS 661.185 is hereby amended to read as follows: 661.185 1. The active officers \, or the managers,\\ and employees of any bank before entering upon their duties shall give bond to the bank in a surety company authorized to do business in Nevada, in the amount required by the directors \or the operating agreement\\ and upon such form as may be approved by the commissioner, the premium for [such] \the\\ bond to be paid by the bank. 2. The commissioner or directors of [such] \the\\ bank may require an increase of the amount of [such] \the\\ bond whenever they deem it necessary. If injured by the breach of any bond given [hereunder,] \under this section,\\ the bank so injured may commence an action and recover such damages as it may have sustained. Sec. 30. NRS 661.195 is hereby amended to read as follows: 661.195 Any director, \manager,\\ officer or other person who participates in any violation of the laws of this state relative to banks is liable for all damage which the bank, its stockholders, \members,\\ depositors or creditors sustain in consequence of such violation. Sec. 31. NRS 661.225 is hereby amended to read as follows: 661.225 1. No bank or bank officer \, manager\\ or director [thereof shall] \may\\ withdraw or permit to be withdrawn, either in the form of dividends or otherwise, any portion of its capital. 2. [If] \Except as otherwise provided in this subsection, if\\ losses have at any time been sustained by [such] \the\\ bank equal to or exceeding its undivided profits then on hand, no dividend [shall] \may\\ be paid [;] \or distribution made,\\ and no dividend [shall] \or distribution may\\ be declared by any bank while it continues its banking business to any amount greater than its profits on hand, deducting therefrom its losses, to be ascertained by a careful estimate of the actual value of its assets at the time of [making such dividends. 3. Nothing in this section prevents] \declaring a dividend or distribution. If a bank receives the prior approval of the commissioner and of the holders of either two-thirds of each class of its stock outstanding or two- thirds of its members' interests, it may pay a dividend or make a distribution greater than its undivided profits. 3. This section does not prevent\\ the reduction of the capital stock of any bank in the manner prescribed in this Title. Sec. 32. NRS 661.235 is hereby amended to read as follows: 661.235 1. As used in this section, "net profits" means the remainder of all earnings from operations plus actual recoveries on loans and investments and other assets, after deducting from the total thereof all operating expenses, actual losses, transfers to reserve for loan losses and all federal and state taxes. 2. [The] \Unless a greater dividend or distribution is authorized pursuant to NRS 661.225, the\\ directors of any state bank may, from time to time, declare a dividend \or distribution\\ of so much of the net profits of the bank as they judge expedient, except that until the surplus fund of such bank equals its common capital, no dividends [shall] \or distributions may\\ be declared unless there has first been carried to the surplus fund 10 percent of the previous year's net profit. No dividends [shall] \may\\ be paid \or distribution made\\ unless the capital and surplus of the bank equal not less than the minimum capital requirements of NRS 661.025. Sec. 33. NRS 662.012 is hereby amended to read as follows: 662.012 As used in this chapter, unless the context otherwise requires, "capital accounts" means capital \,\\ [stocks,] permanent surplus and retained earnings. Sec. 34. NRS 662.015 is hereby amended to read as follows: 662.015 1. In addition to the powers conferred by law upon private corporations, a bank may: (a) Exercise by its board of directors \, managers\\ or authorized officers and agents, subject to law, all powers necessary to carry on the business of banking, by discounting and negotiating promissory notes, drafts, bills of exchange and other evidences of indebtedness, by receiving deposits, by buying and selling exchange, coin and bullion and by loaning money on personal security or real and personal property. At the time of making loans, banks may take and receive interest or discounts in advance. (b) Adopt regulations for its own government not inconsistent with the constitution and laws of this state. (c) Issue, advise and confirm letters of credit authorizing the beneficiaries to draw upon the bank or its correspondents. (d) Receive money for transmission. (e) Establish and become a member of a clearing house association and pledge assets required for its qualification. (f) Exercise any authority and perform all acts that a national bank may exercise or perform, with the consent and written approval of the commissioner. (g) Provide for the performance of the services of a bank service corporation, such as data processing and bookkeeping, subject to any regulations which may be adopted by the commissioner. (h) Unless otherwise specifically prohibited by federal law, sell annuities if licensed by the commissioner of insurance. 2. A bank may purchase, hold and convey real property: (a) As is necessary for the convenient transaction of its business, including furniture and fixtures, with its banking offices and for future site expansion \.\\ [, which] \This\\ investment must not exceed, except as otherwise provided in this section, 60 percent of its capital accounts plus subordinated capital notes and debentures. The commissioner may, in his discretion, authorize any bank located in a city whose population is more than 10,000 to invest more than 60 percent of its capital accounts plus subordinated capital notes and debentures in its banking houses, furniture and fixtures. (b) As is mortgaged to it in good faith by way of security for loans made or money due to the bank. (c) As is permitted by NRS 662.103. 3. [Nothing in this section prohibits] \This section does not prohibit\\ any bank from holding, developing or disposing of any real property it may acquire through the collection of debts due it. Any real property acquired through the collection of debts due it may not be held for a longer time than 10 years. It must be sold at private or public sale within 30 days thereafter. During the time that the bank holds the real property, the bank shall charge off the real property on a schedule of not less than 10 percent per year, or at a greater percentage per year as the commissioner may require. Sec. 35. NRS 662.025 is hereby amended to read as follows: 662.025 Subject to the approval of the commissioner, and on the authority of \its managers or\\ a majority of its board of directors, a bank may: 1. Enter into such contracts, incur such obligations and generally do and perform any or all such acts and things whatsoever as may be necessary or appropriate in order to take advantage of any or all memberships, loans, subscriptions, contracts, grants, rights or privileges which may at any time be available to inure to banking institutions, or to their depositors, creditors, stockholders, \members,\\ conservators, receivers or liquidators, by virtue of those provisions of the Federal Deposit Insurance Act (12 U.S.C. §§ 1811-1831) which creates the Federal Deposit Insurance Corporation and provides for the insurance of deposits, or of any other provisions of that or any other act or resolution of the Congress to aid, regulate or safeguard banking institutions and their depositors, including any amendments to such acts, laws or resolutions or substitutions therefor. 2. Subscribe for and acquire any stock, debentures, bonds or other types of securities of the Federal Deposit Insurance Corporation and shall comply with the lawful regulations and requirements from time to time issued or made by the Federal Deposit Insurance Corporation. Sec. 36. NRS 662.046 is hereby amended to read as follows: 662.046 1. As used in this section "dealing in investment securities" does not include the purchasing and selling of securities without recourse solely upon order and for the account of customers. 2. [Banking corporations] \Banks\\ shall not engage in the business of dealing in any investment securities, either directly or through subsidiary corporations, except as otherwise provided in this Title for [the] investment in public securities or private securities. 3. Any provision contained in the articles of incorporation issued to any banking corporation [prior to] \before\\ July 1, 1971, which is in conflict with this section is revoked. Sec. 37. NRS 662.105 is hereby amended to read as follows: 662.105 Subject to any applicable regulations of the commissioner, a [bank] \banking corporation\\ may grant options to purchase, sell or enter into agreements to sell shares of its capital stock to its officers or employees, or both, for a consideration of not less than 100 percent of the fair market value of the shares on the date the option is granted, or, if pursuant to a stock purchase plan, 85 percent of the fair market value of the shares on the date the purchase price is fixed, pursuant to the terms of a plan for the purchase of stock by officers and employees which has been adopted by the board of directors of the bank and approved by the holders of at least two- thirds of the particular class or classes of stock entitled to vote on the proposal and by the commissioner. In no event may the option to purchase such shares be for a consideration less than the par value thereof. Sec. 38. NRS 662.125 is hereby amended to read as follows: 662.125 1. No bank [shall] \may\\ make any loan or discount on the security of its own capital stock [,] \or members' interests,\\ nor be the purchaser or holder of any such shares [, unless such] \or interests, unless the\\ security or purchase is necessary to prevent loss upon a debt previously contracted in good faith. Stock \or interests\\ so purchased or acquired [shall,] \must\\ within 12 months [from the time of its purchase,] \after purchase\\ be sold or disposed of at public or private sale. After the expiration of 12 months, any such stock \or interests\\ not so disposed of [shall] \must\\ be charged to profit and loss and [shall] \must\\ not be considered as part of the assets of the bank. 2. Any bank may sell or become the owner of any property which may come into its possession as collateral security for any debt or obligation due it, according to the terms of any contract depositing such collateral security, and if there is no such contract, then [such] \the\\ collateral security may be sold in the manner provided by law. Any such property other than real property must be sold within 2 years [from the date of its] \after\\ acquisition. Sec. 39. NRS 662.135 is hereby amended to read as follows: 662.135 1. Except as otherwise provided in this section and subject to the provisions of NRS 662.065 and 662.125, no bank may make any investment in capital stock \or become a member\\ of any other state or national bank. 2. A bank doing business under this Title may subscribe to or purchase, upon such terms as may be agreed upon, the capital stock of banks organized under the Act of Congress known as the Edge Act or the capital stock of central reserve banks whose capital stock exceeds $1,000,000. 3. In order to constitute a central reserve bank as contemplated by this Title, at least 50 percent of the capital stock of such bank must be owned by other banks. The investment by any bank in the capital stock of such central reserve bank or a bank organized under the Edge Act, must at no time exceed 10 percent of the paid-in capital and permanent surplus of the bank making the investment. 4. A bank shall not invest in the stocks \or ownership\\ of other corporations, firms, partnerships or companies except as otherwise provided in this Title, unless [such stock is purchased] \the investment is made\\ to protect the bank from loss. 5. Any stocks \or ownership\\ owned or acquired after July 1, 1971, in excess of the limitations imposed by this section must be disposed of at public or private sale within 12 months after the date of acquiring them, and if not so disposed of they must be charged to profit and loss account, and no longer carried on the books as an asset. The limit of time in which such stocks [are] \or ownership is\\ disposed of or charged off the books of the bank may be extended by the commissioner if in his judgment it is for the best interest of the bank that [such] \an\\ extension be granted. 6. A bank may subscribe to, purchase or become the owner of stock in: (a) Federal reserve banks as established by Act of Congress approved December 23, 1913, being c. 6, 38 Stat. 251, or any amendment thereof; or (b) Any governmental agency or liquidating or financial corporation created by the Congress of the United States. 7. A bank may invest up to 50 percent of its surplus in the stock \or membership\\ of corporations \or limited-liability companies\\ engaged in related banking fields. Sec. 40. NRS 662.205 is hereby amended to read as follows: 662.205 1. As used in this section: (a) "Board of Governors of the Federal Reserve System" means the Board of Governors of the Federal Reserve System created and described in the Federal Reserve Act. (b) "Federal Reserve Act" means the Act of Congress, approved December 23, 1913, being c. 6, 38 Stat. 251, as [heretofore and hereafter] amended. (c) "Federal Reserve Bank" means the Federal Reserve Banks created and organized under authority of the Federal Reserve Act. (d) "Member bank" means any national bank, state bank or banking and trust company which has become or which becomes a member of one of the Federal Reserve Banks created by the Federal Reserve Act. 2. Any bank [incorporated] \organized\\ under the laws of this state [shall have the power to] \may\\ subscribe to the capital stock and become a member of a Federal Reserve Bank. 3. Any bank [incorporated] \organized\\ under the laws of this state which is, or which becomes, a member of a Federal Reserve Bank is, by this section, vested with all powers conferred upon member banks of the Federal Reserve Banks by the terms of the Federal Reserve Act as fully and completely as if such powers were specifically enumerated and described in this section, and all such powers [shall] \must\\ be exercised subject to all restrictions and limitations imposed by the Federal Reserve Act, or by regulations of the Board of Governors of the Federal Reserve System made pursuant thereto. The right, however, is expressly reserved to revoke or to amend the powers conferred in this section. 4. A compliance on the part of any such bank with the reserve requirements of the Federal Reserve Act shall be [held] \deemed\\ to be a full compliance with those provisions of the laws of this state which require banks to maintain cash balances in their vaults or with other banks, and no such bank [shall be required to] \need\\ carry or maintain a reserve other than such as is required under the terms of the Federal Reserve Act. 5. Any such bank [shall continue] \continues\\ to be subject to the supervision and examinations required by the laws of this state, except that the Board of Governors of the Federal Reserve System [shall have the right,] \may,\\ if it deems necessary, [to] make examinations. The authorities of this state having supervision over such bank may disclose to the Board of Governors of the Federal Reserve System, or to examiners duly appointed by it, all information in reference to the affairs of any bank which has become, or desires to become, a member of a Federal Reserve Bank. Sec. 41. NRS 662.245 is hereby amended to read as follows: 662.245 1. Except as otherwise specifically provided by statute, no [banking] \bank\\ or other [corporation,] \organization,\\ and no officer, employee or agent of such [a corporation,] \an organization,\\ acting in its behalf, may be appointed to act as fiduciary by any court or by authority of any law of this state unless, in addition to any other requirements of law, the [banking] \bank\\ or other [corporation:] \organization:\\ (a) Is organized under the laws of and has its principal place of business in this state; (b) Is a national banking association which has its principal place of business in this state; (c) Associates as cofiduciary a [banking corporation] \bank\\ whose principal place of business is in this state; or (d) Is a national bank, banking corporation, trust corporation or trust company which: (1) Is organized under the laws of and has its principal place of business in another state which allows [banking corporations,] \banks,\\ trust corporations or trust companies organized under the laws of this state to act as fiduciary; (2) Is authorized by its charter to act as fiduciary; and (3) Before the appointment as fiduciary, files with the secretary of state a document, acknowledged before a person authorized to take acknowledgments of deeds, which: (I) Appoints the secretary of state as its attorney upon whom all process in any action or proceeding against it may be served; and (II) Contains its agreement that the appointment continues in force as long as any liability remains outstanding against it in this state, and that any process against it which is served on the secretary of state is of the same legal validity as if served on it personally. A copy of the document required by this subparagraph, certified by the secretary of state, is sufficient evidence of the appointment and agreement. 2. A court with jurisdiction over the accounts of a fiduciary that is a national bank, banking corporation, trust corporation or trust company described in paragraph (d) of subsection 1, may require such a fiduciary to provide a bond to ensure the performance of its duties as fiduciary, in the same manner and to the same extent as the court may require such a bond from a fiduciary that is a banking or other corporation described in paragraph (a) or (b) of subsection 1. 3. As used in this section: (a) "Fiduciary" means an executor, commissioner, guardian of minors or estates, receiver, depositary or trustee. (b) "State" means any state or territory of the United States, or the District of Columbia. Sec. 42. NRS 662.265 is hereby amended to read as follows: 662.265 As used in NRS 662.275 to 662.305, inclusive, unless the context otherwise requires: 1. "Bank" includes national banks to the extent that NRS 662.275 to 662.305, inclusive, do not conflict with or infringe upon federal law. 2. "Emergency" means any condition or occurrence which may interfere physically with the conduct of normal business operations at one or more or all of the offices of a bank, or which poses an imminent or existing threat to the safety or security of persons or property, or both. Without limiting the generality of the foregoing, an emergency may arise as a result of any one or more of the following: Fire, flood, earthquake, hurricanes, wind, rain or snowstorms, labor disputes and strikes, power failures, transportation failures, interruption of communication facilities, shortages of fuel, housing, food, transportation or labor, robbery or attempted robbery, actual or threatened enemy attack, epidemics or other catastrophes, riots, civil commotions and other acts of lawlessness or violence, actual or threatened. 3. "Office" means any place at which a bank transacts its business or conducts operations related to its business. 4. "Officers" means the person or persons designated by the board of directors \, the managers\\ or other governing body of a bank, to act for the bank in carrying out the provisions of NRS 662.275 to 662.305, inclusive, or in the absence of any such designation or the absence of the officer or officers so designated, the president \, a manager\\ or any other officer currently in charge of the bank or of the office or offices in question. Sec. 43. NRS 665.045 is hereby amended to read as follows: 665.045 Upon the preparation of the report as provided in NRS 665.035, the commissioner shall forthwith serve a copy thereof on the president or secretary of the board of directors of the [bank,] \banking corporation or a manager of the banking company,\\ and may make copies available to each member of [such board.] \the board of directors or each manager.\\ If, in the judgment of the commissioner, the report discloses any violation of the provisions of this Title on the part of the bank, or if it appears from the report that there are certain conditions existing which should be corrected by the bank, the commissioner may, in writing, call the matter to the attention of each member of the board of directors \, or each manager,\\ with instructions to correct the condition. Sec. 44. NRS 665.075 is hereby amended to read as follows: 665.075 1. The report of examination made by an examiner of the division of financial institutions is designed for use in the supervision of the bank. The bank's copy of the report is the property of the commissioner and is furnished to the bank solely for its confidential use. 2. The bank's directors [,] \or managers,\\ in keeping with their responsibilities both to depositors and to stockholders [,] \or members,\\ shall thoroughly review the report. Under no circumstances may the bank, or any of its directors, \managers,\\ officers or employees disclose or make public in any manner the report or any portion thereof. The report must not be made available to other banking institutions in connection with proposed transactions such as mergers and consolidations. The report must not be made available to a clearing house association, but a bank may voluntarily disclose information concerning its affairs to a clearing house association where a disclosure is through reports prepared by the bank or by others at the request of the bank. Sec. 45. NRS 665.105 is hereby amended to read as follows: 665.105 1. Every bank shall make at least four reports each year to the commissioner at the same times and substantially in the form of similar reports required by the Comptroller of the Currency, the Federal Reserve Bank or the Federal Deposit Insurance Corporation. 2. The bank shall make additional reports within 10 days after the receipt of a request therefor from the commissioner. 3. The reports must be prepared by the cashier or by any competent person approved by the commissioner and be verified by the oath or affirmation of the president or vice president \, or a manager,\\ and \the\\ cashier, the person by whom the reports were prepared, and by at least three of the directors [.] \or two other managers.\\ 4. Each report must: (a) Exhibit in detail, and under the appropriate heads, the resources and liabilities and a profit and loss account of the bank at the close of business on any past day specified by the commissioner. (b) Be published in condensed form, according to the requirements of the commissioner, within 10 days after the report is made, in a newspaper published in the county in which [such] \the\\ bank is established, for one insertion, at the expense of the bank. Such proof of publication must be furnished within 5 days after the date of publication as may be required by the commissioner. 5. The commissioner may call for special reports, which need not be published, from any bank whenever, in his judgment, the reports are necessary in order to gain complete knowledge of its condition. Sec. 46. NRS 665.135 is hereby amended to read as follows: 665.135 In making examinations as required by this Title, the commissioner and any appointed examiner may administer oaths to examine any officer, director, \manager,\\ agent, employee, customer, depositor, shareholder \or member\\ of the bank, or any other person or persons, touching the affairs and business of the bank being examined. Any examiner may summon in writing any officer, director, \manager,\\ agent, employee, customer, depositor, shareholder \or member,\\ or any person or persons resident of this state \,\\ to appear before him and testify in relation to the affairs and business of such bank. Sec. 47. NRS 665.145 is hereby amended to read as follows: 665.145 Each official communication directed by the commissioner or any examiner of financial institutions to any bank, or to any officer \or manager\\ thereof, relating to an examination or investigation conducted or made by the commissioner or containing suggestions or recommendations as to the conduct of the bank [shall,] \must,\\ if required by the authority [submitting the same,] \directing it,\\ be submitted by the officer \, manager\\ or director receiving it to the executive committee, if there is one, or board of directors [of such] \or the other managers of the\\ bank and noted in the minutes of the meeting. The receipt and submission of the notice to the executive committee \,\\ [or] board of directors \, or other managers\\ must be certified to the commissioner, within such time as he may require, by three members of [such] \the\\ committee or board [.] \or two other managers.\\ Sec. 48. NRS 665.165 is hereby amended to read as follows: 665.165 1. Every state bank shall retain its business records for such periods as are or may be prescribed by or in accordance with the terms of this section. 2. Each state bank shall retain permanently the minute books of meetings of its stockholders and directors, \any analogous formal proceedings of its members or managers,\\ its capital stock ledger and capital stock certificate ledger or stubs, its general ledger, its investment ledger, its copies of bank examination reports, and all records which the commissioner in accordance with this section requires to be retained permanently. 3. All other bank records must be retained for such periods as the commissioner may in accordance with this section prescribe. 4. The commissioner shall, from time to time, issue regulations classifying all records kept by state banks and prescribe the period for which records in each class must be retained. [Such] \The\\ periods may be permanent or for a lesser term of years. The commissioner shall keep such regulations current and shall revise them at least once every 3 years. In issuing and revising such regulations, the commissioner shall consider: (a) Actions at law and administrative proceedings in which the production of bank records might be necessary or desirable. (b) State and federal statutes of limitation applicable to such actions or proceedings. (c) The availability of information contained in bank records from other sources. (d) Such other matters as the commissioner considers pertinent in order that his regulations will require banks to retain their records for as short a period as is commensurate with the interests of bank customers and shareholders \or members\\ and of the people of this state in having bank records available. 5. Any state bank may dispose of any record which has been retained for the period prescribed by or in accordance with the terms of this section for retention of records of its class, and [shall thereafter be] \thereafter is\\ under no duty to produce [such] \the\\ record in any action or proceeding. 6. Any state bank may cause any or all records required to be kept pursuant to this section to be reproduced by the microphotographic process and any such reproduction has the same effect as the original. Upon completion of a microphotographic duplication, the original of any record may be destroyed. 7. To the extent that they are not in contravention of any law of the United States, the provisions of this section apply to all banks doing business in this state. Sec. 49. NRS 665.175 is hereby amended to read as follows: 665.175 The commissioner may require the immediate removal from office of any officer, director \, manager\\ or employee of any bank doing business under this Title who is found to be dishonest, incompetent or reckless in the management of the affairs of the bank, or who persistently violates the laws of this state or the lawful orders, instructions and regulations issued by the commissioner. Sec. 50. NRS 666.015 is hereby amended to read as follows: 666.015 1. A state bank may merge or consolidate with, or transfer its assets and liabilities to, another state bank. Before the merger, consolidation or transfer becomes effective, each bank concerned in the merger, consolidation or transfer shall file with the commissioner certified copies of the minutes of all proceedings had by its directors and stockholders \, or managers and members,\\ regarding the merger, consolidation or transfer. 2. The minutes of the proceedings had by the stockholders \or members\\ of each bank must set forth that holders of at least two-thirds of the stock \or members' interests\\ voted in the affirmative on the proposition of merger, consolidation or transfer. The minutes must also contain or have attached thereto a complete copy of the agreement made and entered into between the banks, with reference to the merger, consolidation or transfer. 3. When the certified copies of all minutes have been filed, the commissioner shall conduct an investigation of each bank to determine: (a) Whether the interests of the depositors, creditors and stockholders \or members\\ of each bank are protected. (b) That the merger, consolidation or transfer is in the public interest. (c) That the merger, consolidation or transfer is made for legitimate purposes. 4. The commissioner's consent to or rejection of the merger, consolidation or transfer must be based upon his investigation. No merger, consolidation or transfer may be made without the consent of the commissioner. The expense of the investigation must be paid by the banks. 5. Notice of the merger, consolidation or transfer must be published once a week for 4 consecutive weeks, before or after the merger, consolidation or transfer is effective at the discretion of the commissioner, in a newspaper published in a city, town or county in which each of the banks is located, and a certified copy of the notice must be filed with the commissioner. 6. In any merger, consolidation or transfer, all rights of creditors and all liens upon any property of the constituent banks must be preserved unimpaired, limited in lien to the property affected by those liens immediately before the time of the merger, consolidation or transfer. All debts, liabilities and duties of the respective constituent banks must thenceforth attach to the surviving, consolidated or transferee bank and may be enforced against it to the same extent as if the debts, liabilities and duties had been incurred or contracted by it. 7. In the case of a merger, consolidation or transfer pursuant to the provisions of this section, if any stockholder \or member\\ of any constituent bank votes against the agreement, objects to the agreement in writing at or before the taking of the vote thereon, and \,\\ [that stockholder,] within 20 days after the date on which the agreement is filed as provided in this section, demands in writing from the surviving or consolidated bank payment [of] \for\\ his shares [,] \or interest,\\ the surviving, consolidated or transferee bank shall, within 30 days thereafter, pay to the stockholder \or member\\ the fair cash value of his shares \or interest\\ as of the day before the vote on the agreement of merger, consolidation or transfer was taken, exclusive of any element of value arising from the expectation or accomplishment of the merger, consolidation or transfer. Sec. 51. NRS 666.035 is hereby amended to read as follows: 666.035 1. A state bank may, with the approval of the commissioner, consolidate, convert into or merge with a national bank upon the vote of the holders of two-thirds of each class of voting stock of \, or of the members' interests in,\\ the state bank. 2. The commissioner shall not approve any consolidation, conversion or merger under this section which would: (a) Result in a monopoly or which would further any attempt to monopolize the business of banking in this state; or (b) Substantially lessen competition or be in restraint of trade, unless the commissioner finds that the anticompetitive effects of the proposed transaction are clearly outweighed by the probable success of the transaction in meeting the needs of the community to be served. In every case, the commissioner shall consider the financial and managerial resources and the future prospects of the company or companies and the banks concerned, and the convenience and the needs of the community to be served. 3. Except as \otherwise\\ provided in subsection 5, the rights and liabilities of a state bank which consolidates, converts into or merges with a national bank, and the rights and liabilities of its stockholders [,] \or members,\\ are the same as the rights and liabilities prescribed by the law of the United States for national banks and their stockholders \or members\\ at the time of the consolidation, conversion or merger. 4. Upon consolidation, conversion or merger, the resulting national bank becomes the same business as each consolidating, converting or merging bank, with all the property rights, power and duties of each consolidating, converting or merging bank, except as affected by the law of the United States and by the charter and bylaws of the resulting bank. Any reference to a consolidating, converting or merging bank in any writing, whether executed or which takes effect before or after the consolidation, conversion or merger, is applicable to the resulting bank if not inconsistent with the other provisions of that writing. 5. The holders of shares of the stock of \, or members' interests in,\\ a state bank which were voted against a consolidation or merger into a national bank are entitled to receive their value in cash, if and when the consolidation or merger becomes effective, upon written demand made to the resulting national bank at any time within 30 days after the effective date of the consolidation or merger, accompanied by the surrender of any stock certificate or certificates. The value of the shares \or interests\\ must be determined, as of the date of the meeting of the stockholders approving the consolidation or merger, by three appraisers, one to be selected by the owners of two-thirds of the dissenting shares \or interests\\ involved, one by the board of directors of the resulting national bank, and the third by the two so chosen. The valuation agreed upon by any two appraisers governs. If the appraisal is not completed within 90 days after the consolidation or merger becomes effective, the Comptroller of the Currency shall cause an appraisal to be made. 6. The amount fixed as the value of the shares of stock of \, or members' interests in,\\ the consolidating or merging bank at the time of the meeting of the stockholders approving the consolidation or merger, and the amount fixed by the appraisal as provided by subsection 5, where the fixed value is not accepted, constitute a debt of the resulting national bank. 7. Upon the completion of the consolidation, conversion or merger, the license to operate as a state bank automatically terminates. Sec. 52. NRS 666.065 is hereby amended to read as follows: 666.065 As used in NRS 666.065 to 666.215, inclusive, unless the context otherwise requires: 1. To "acquire" a bank means to obtain control of an existing bank or to establish a new bank. 2. "Bank holding company" means a company: (a) Which directly or indirectly owns or controls 25 percent or more of the voting stock of \, or members' interests in,\\ a bank; (b) Which controls the election of a majority of the directors \or managers\\ of a bank; or (c) For the benefit of whose stockholders 25 percent or more of the voting stock of \, or members' interests in,\\ a bank is held by one or more trustees. 3. "Business trust" means an organization in which a business or property is conveyed to trustees who manage the business or property for the benefit of the holders of the beneficial interest in the trust. The term does not include a voting trust. 4. "Company" means any corporation, business trust, association or similar entity, but does not include: (a) A natural person; or (b) A corporation of which a majority of the stock is owned by the United States or any state. Sec. 53. NRS 666.075 is hereby amended to read as follows: 666.075 1. There is a rebuttable presumption that a company which directly or indirectly owns, controls or has the power to vote less than 5 percent of the voting stock of \, or members' interests in,\\ a bank does not control the bank. 2. An estate, trust, guardianship or conservatorship is not by virtue of its ownership or control of stock of \, or members' interests in,\\ a bank, a bank holding company unless it is: (a) A business trust; or (b) A voting trust which by its terms or by law does not expire within 10 years after the date of its establishment. 3. A company is not a bank holding company by virtue of its ownership or control of stock \or a member's interest\\ which: (a) Was acquired in the ordinary course of securing or collecting a debt which the company previously contracted in good faith; and (b) Is held only as long as is necessary to sell the stock on a reasonable basis. Sec. 54. NRS 666.115 is hereby amended to read as follows: 666.115 1. Except as \otherwise\\ provided in subsection 4, a person who desires to form a bank holding company after July 1, 1983, must be approved by the commissioner before forming the company. \A bank holding company may not be organized as a limited-liability company.\\ 2. The application for approval must include such information with respect to the financial condition, operations, management and intercompany relationships of the applicant and related matters, as the commissioner may deem necessary or appropriate. 3. The commissioner shall approve the application if he determines that the applicant or its officers, directors and stockholders are of such character and fitness that any bank acquired by the applicant will be operated in a safe, prudent and profitable manner. 4. The commissioner may accept copies of federal registration in lieu of requiring an application for approval of a bank holding company. Sec. 55. NRS 667.015 is hereby amended to read as follows: 667.015 1. A bank may go into voluntary liquidation and be closed, and may surrender its charter and franchise as a corporation of this state by the affirmative votes of its stockholders owning two-thirds of its stock [.] \, or of its members holding two-thirds of the members' interests.\\ The vote must be taken at a meeting of the stockholders called by resolution of the board of directors [.] \, or at a meeting of the members called by the managers.\\ Written notice of the meeting, which notice must state the purpose of the meeting, must be mailed to each stockholder [,] \or member,\\ or in case of his death, to his legal representative or heirs at law, addressed to his last known residence 10 days before the date of the meeting. 2. [When] \If\\ the stockholders \or members\\ decide to liquidate the bank, a certified copy of all proceedings of the meeting at which that action is taken, verified by the oath of the president \or a manager\\ and \the\\ cashier, must be transmitted to the commissioner for his approval. If the commissioner approves the liquidation, he shall issue to the bank, under his seal, a permit for that purpose. No permit may be issued by the commissioner until he is satisfied that provision has been made by the bank to satisfy and pay off all depositors and all creditors of the bank. If he is not satisfied, the commissioner shall not issue a permit, but he may take possession of the bank, its assets and business, and liquidate the bank in the manner provided by this chapter. 3. When the commissioner approves the voluntary liquidation of a bank, the directors \or managers\\ of the bank shall cause to be published in a newspaper in the city, town or county in which the bank is located, a notice that the bank is closing its affairs and going into liquidation, and that its depositors and creditors are to present their claims for payment. 4. When any bank is in the process of voluntary liquidation, it is subject to examination by the commissioner, and the bank shall furnish such reports, from time to time, as may be called for by the commissioner. 5. All unclaimed deposits and dividends remaining in the hands of the bank are subject to the provisions of this chapter. 6. Any bank may sell and transfer to any other state or national bank all of its assets of every kind upon such terms as may be agreed upon and approved by the commissioner and by two-thirds vote of the bank's board of directors [.] \or of its managers.\\ A certified copy of the minutes of any meeting at which that action is taken, under the oath of the president \or a manager\\ and \the\\ cashier, together with a copy of the contract of sale and transfer, must be filed with the commissioner. 7. If a voluntary liquidation or the sale and transfer of the assets of any bank is approved by the commissioner, a certified copy of that approval under seal of the commissioner, filed in the office of the secretary of state, authorizes the cancellation of the [charter certificate] \articles of incorporation or organization\\ of the bank, subject to its continued existence, as provided by law. Sec. 56. NRS 667.055 is hereby amended to read as follows: 667.055 Among its other powers, the Federal Deposit Insurance Corporation, in the performance of its powers and duties as receiver or liquidator, may, upon the order of a court of record of competent jurisdiction, enforce the individual liability of the stockholders \or members\\ and directors \or managers\\ of any such bank. Sec. 57. NRS 667.225 is hereby amended to read as follows: 667.225 1. When any bank is authorized to dissolve, and has taken the necessary steps to effect dissolution in accordance with the laws of this state or the laws of the United States, but before actual dissolution, a majority of the directors \or managers\\ of the national or state bank, upon authority in writing of the owners of two- thirds of its capital stock \or two-thirds of the members' interests\\ and with the approval of the commissioner, may execute articles of incorporation \or organization\\ as provided in this Title for the organization of a new bank \.\\ [, which] \The\\ articles must further set forth the authority derived from the stockholders \or members\\ of the national or state bank. 2. Upon \the\\ filing \of\\ articles of incorporation \or organization\\ in the same manner as provided for the organization of new banks, the reorganized bank is a bank under the laws of this state. Upon reorganization, all assets, real and personal, of the dissolved national or state bank, by operation of law, vest in and become the property of the reorganized state bank, subject to all liabilities of the national or state bank existing before the reorganization. Sec. 58. NRS 668.055 is hereby amended to read as follows: 668.055 Every president, director, \manager,\\ cashier, teller, clerk, officer or agent of any bank who embezzles, abstracts or willfully misapplies any money, funds, securities or credits of any bank, or who issues or puts forth any certificate of deposit, draws any draft, bill of exchange or mortgage, or who makes use of any bank in any manner, with intent to injure or defraud any bank or person, or to deceive any bank, or officer of any bank, and any natural person who, with like intent, aids or abets any officer, clerk or agent in any violation of this section, shall be punished: 1. Where the amount involved is $250 or more, by imprisonment in the state prison for not less than 1 year nor more than 10 years, or by a fine of not more than $10,000, or by both fine and imprisonment. 2. Where the amount involved is less than $250, for a misdemeanor. Sec. 59. NRS 668.065 is hereby amended to read as follows: 668.065 Every officer, director \, manager\\ or employee of a bank required by this Title to take an oath or affirmation who willfully swears or affirms falsely is guilty of perjury, and upon conviction thereof shall be punished as provided by the laws of this state for cases of perjury. Sec. 60. NRS 668.075 is hereby amended to read as follows: 668.075 [No] \A\\ bank or \an\\ officer \or manager\\ of [any] \a\\ bank shall \not\\ advertise in any manner or publish any statement of the capital stock authorized or subscribed, unless the amount of capital stock actually paid up is advertised or published therewith. Sec. 61. NRS 138.020 is hereby amended to read as follows: 138.020 1. No person is competent to serve as an executor or executrix who, at the time the will is probated: (a) Is under the age of majority; (b) Has been convicted of a felony; (c) Upon proof, is adjudged by the court incompetent to execute the duties of the trust by reason of drunkenness, improvidence, or want of integrity or understanding; or (d) Is a [banking corporation] \bank\\ whose principal place of business is not in the State of Nevada, unless it associates as coexecutor a [banking corporation] \bank\\ whose principal place of business is in this state. An out-of-state [banking corporation] \bank\\ is competent to appoint a substitute executor or executrix, pursuant to NRS 138.045, without forming such an association, but any natural person so appointed shall be a resident of this state. 2. If any such person be named as the sole executor or executrix in any will, or if all persons so named are incompetent, or shall renounce the trust, or fail to appear and qualify, letters of administration with the will annexed shall issue. -30-