5. The names and compensation of the clerks employed by him, and the whole amount of the expenses of the department during the year, and the amount, if any, for which the treasury shall be in advance.

Such report shall be made by or before the last day of the year, and the usual number of copies for the use of the legislature shall be printed and in readiness for distribution by the printer employed to print legislative documents, and one thousand copies shall be printed for the use of the department, the expense of which shall be charged to the general expenses of the department.

Such report may be divided into parts, and the part or parts containing the reports of corporations other than banks may be made on or before the fifteenth day of March in each year.

§ 26. Reports presumptive evidence. Every official report made by the superintendent to the attorney-general, and every report duly verified of any examination made; shall be presumptive evidence of the facts therein stated in all motions in any action or proceeding for the appointment of a temporary receiver of any corporation to which such report relates.

§ 27. Restrictions. 1. No bank or trust company shall make any loans to any person, company, corporation or firm, to an amount exceeding the one-tenth part of its capital stock, actually paid in, and surplus; provided, however, that a bank or trust company having its principal place of business in a borough in any city of the state which borough had according to the last preceding state or United States census a population of eighteen hundred thousand or over may loan to any person, company, corporation or firm, a sum not exceeding twenty-five per centum of its capital stock actually paid in and surplus and a bank or trust company having its principal place of business elsewhere in the state forty per centum of its capital stock actually paid in and surplus upon security worth at least fifteen per centum more than the amount of the loans; or it may loan ten per centum of such capital and surplus as first above provided, and a bank or trust company having its principal place of business in a borough in any city in the state which borough had according to the last preceding state or United States census a population of eighteen hundred thousand or over may loan a further sum not exceeding fifteen per centum of such capital and surplus and a bank or trust company having its principal place of business elsewhere in the state may loan thirty per centum of such capital and surplus upon security worth at least fifteen per centum more than the amount of such loan so secured; and provided further, that a bank or trust

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company may buy from, or discount for, any person, company, corporation or firm, or loan upon, bills of exchange drawn in good faith against actually existing values, or commercial or business paper actually owned by the person negotiating the same, a sum not exceeding twenty-five per centum of its capital stock actually paid in and surplus if its principal place of business is located in a borough in any city in the state which borough had according to the last preceding state or United States census a population of eighteen hundred thousand or over and not exceeding forty per centum of its capital stock actually paid in and surplus if its principal place of business is located elsewhere in the state; provided further, however, that with the exception of the liability of the United States, of this state, or of any county or incorporated city of this state the total liability of any person, company, corporation or firm to a bank or trust company shall not exceed twenty five per centum of the actually paid in capital stock and surplus of any such bank or trust company having its principal place of business in a borough in any city in the state which borough had according to the last preceding state or United States census a population of eighteen hundred thousand or over and shall not exceed forty per centum of the actually paid in capital stock and surplus of any such bank or trust company having its principal place of business elsewhere in the state.

2. No loan shall be made by any bank or trust company upon the securities of one or more corporations the payment of which is undertaken in whole or in part severally, but not jointly, by two or more individuals, firms or corporations:

(a) if the borrowers or underwriters be obligated absolutely or contingently to purchase the securities or any of them collateral to such loan, unless the borrowers or underwriters shall have paid on account of the purchase of such securities an amount in cash or its equivalent equal to at least twenty-five per centum of the several amounts for which they remain obligated in completing the purchase of such securities;

(b) if the bank or trust company making such loan be liable directly, indirectly or contingently, for the repayment of such loan or any part thereof;

(c) if its term including any renewal thereof, by agreement, express or implied, exceed the period of one year;

(d) or to an amount, under any circumstances, in excess of twenty-five per centum of the capital and surplus of the bank or trust company making such loan.

3. No corporation to which this chapter is applicable except a building and mutual loan corporation or association or a co-operative savings and loan association shall hereafter make a loan, directly or indirectly, upon the security of real estate upon which

there is a prior mortgage, lien or incumbrance, if the amount unpaid upon such prior mortgage, lien or incumbrance, or the aggregate amount unpaid upon all prior mortgages, liens and incumbrances exceeds ten per centum of the capital and surplus of such corporation, or if the amount so secured, including all prior mortgages, liens and incumbrances shall exceed two-thirds of the appraised value of such real estate as found by a committee of the directors or trustees of such corporation; but this provision shall not prevent the acceptance of any such real estate securities to secure the payment of a debt previously contracted in good faith. Every mortgage and every assignment of a mortgage taken or held by such corporation shall immediately be recorded in the office of the clerk of the county in which the real estate described in the mortgage is located. After the first day of November, nineteen hundred and eight, no loan shall be made, directly or indirectly, upon real estate security by a bank having its principal place of business in a borough in any city in the state which borough had, according to the last preceding state or United States census, a population of eighteen hundred thousand or over, if its total direct and indirect loans upon real estate security exceed, or by the making of such loan will exceed, fifteen per centum in the aggregate of the total assets of such bank, or by a bank having its principal place of business in a village of not over fifteen hundred inhabitants, according to such census, in which there is no savings bank, if its total loans upon real estate security exceed, or by the making of such loan will exceed, forty per centum in the aggregate of its total assets, or by a bank having its principal place of business elsewhere in the state if its total direct and indirect loans upon real estate security exceed, or by the making of such loan will exceed twenty-five per centum in the aggregate of its total assets. (Subd. 3 thus amended by L. 1909, ch. 410, in effect May 20, 1909.)

Amendment of 1909 inserted in the last sentence the words, beginning "in a village" and ending with " place of business".

4. No corporation to which this chapter is applicable, except a mortgage, loan or investment corporation, nor any of its directors, officers, agents or servants shall, directly or indirectly, purchase or be interested in the purchase of any promissory note or other evidence of debt issued by it for a less sum than shall appear on the face thereof to be due. Every person violating the provisions of this subdivision shall forfeit to the people of the state three times the nominal amount of the note or other evidence of debt so purchased. (Subd. 4 thus amended by L. 1909, ch. 402, in effect May 19, 1909.)

Amendment of 1909 inserted the words "except a mortgage, loan or investment corporation".

5. No corporation to which this chapter is applicable shall de

posit any of its funds with any other moneyed *corporations unless such other moneyed corporation has been designated as a depositary for its funds by vote of a majority of the directors or trustees of the corporation making the deposit, exclusive of any director or trustee who is an officer, director or trustee of the depositary so designated.

6. No president, director, cashier, clerk or agent of any corporation to which this chapter is applicable, and no person in any way interested or concerned in the management of its affairs, shall as individuals discount, or, directly or indirectly, make any loan upon any note or other evidence of debt, which he shall know to have been offered for discount to such corporation, and to have been refused. Every person violating the provisions of this subdivision, shall, for each offense, forfeit to the people of the state twice the amount of the loan which he shall have made.

7. No officer, director, clerk or agent of any bank shall borrow, directly or indirectly, from the bank with which he is officially connected any sum of money without the consent and approval of a majority of the board of directors thereof. Every person violating this provision shall, for each offense, forfeit to the people of the state twice the amount which he shall have borrowed.

8. No corporation to which this chapter is applicable except a building and mutual loan corporation or co-operative savings and loan association, shall make any loan or discount on the security of the shares of its own capital stock nor be the purchaser or holder of any such shares unless such security or purchase shall be necessary to prevent loss upon a debt previously contracted in good faith; and stock so purchased or acquired shall, within six months from the time of its purchase, be sold or disposed of at public or private sale. Every person or corporation violating the provisions of this subdivision shall forfeit to the people of the state twice the nominal amount of such stock.

9. No corporation to which this chapter is applicable shall hereafter make a loan, secured by the stock of another moneyed corporation, if by the making of such loan the total stock of such other moneyed corporation held by it as collateral will exceed in the aggregate ten per centum of the capital stock of such other moneyed corporation. (Subd. 9 thus amended by L. 1909, ch. 240, § 2, in effect April 22, 1909.)

Amendment of 1909 only corrected typographical error.

10. The directors of any bank may semi-annually or quarterly declare a dividend of so much of the net profits of the corporation of which they are directors as they shall judge expedient, but each such corporation shall, before the declaration of a dividend, carry

*So in original.

one-tenth part of its net profits earned since its last preceding dividend to its surplus fund until the same shall amount to twenty per centum of its capital. Any surplus fund already accumulated by any such corporation may be counted as part of said twenty per centum. Each corporation shall report to the superintendent of banks within ten days after declaring a dividend the amount of such dividend, and the amount of net earnings in excess of such dividend, and the amount carried to the surplus fund. Such report shall be attested by the oath of the president or cashier of the corporation. If the directors of any such corporation shall knowingly violate, or knowingly permit any of the officers, agents or servants of the corporation to violate any of the provisions of this subdivision, all the rights, privileges and franchises of the corporation shall thereby be forfeited. Such violation shall, however, be determined and adjudged by the supreme court of the state in a suit brought for that purpose by the superintendent of banks in his own name before the corporation shall be declared dissolved.

11. No savings bank hereafter incorporated shall do business or be located in the same room or in any room communicating with any bank, or national banking association.

§ 28. Calculation of profits. Interest unpaid, although due or accrued on debts owing to the corporation or banker, shall not be included in the calculation of its profits previous to a dividend, unless such interest be accrued upon loans secured by collaterals as provided by section twenty-seven of this chapter. The surplus profits, from which alone a dividend can be made, shall be ascertained by charging in the account of profit and loss and deducting from the actual profits:

1. All expenses paid or incurred, both ordinary and extraordinary, attending the management of its affairs and the transaction of its business.

2. The interest paid, or then due and accrued, on debts owing by it.

3. All losses sustained by it. In the computation of such losses, all debts owing to it shall be included which shall have remained due, without prosecution, and upon which no interest shall have been paid for more than one year, or on which judgment shall have been recovered that shall have remained for more than two years unsatisfied, and on which no interest shall have been paid during that period.

§ 29. Losses in excess of profits. All losses sustained by any corporation or banker subject to this chapter, in excess of its undivided profits then realized and possessed, shall be charged as a reduction of its capital stock, and no dividend shall thereafter be made on its shares of stock until the deficit of capital