§ 1175. — 1175. (Added by Stats. 2011, Ch. 243, Sec. 3.)

California § 1175.

• Jurisdiction: California
• Code FIN: Financial Code - FIN
• Div. 1.1.: DIVISION 1.1. BANKING
• Ch. 5.: CHAPTER 5. Corporate Requirements
• Art. 5.: ARTICLE 5. Directors

Text

(a)
For purposes of Section 316 of the Corporations Code, to the extent that the making by a bank or by any majority-owned subsidiary of a bank of a distribution to any shareholder of the bank is contrary to any provision of Article 3 (commencing with Section 1130), the making of the distribution shall, to that extent, be deemed to be contrary to the provisions of Section 500 of the Corporations Code.
(b)
The commissioner may, in the name of the people of this state, bring or intervene in an action under Section 316 of the Corporations Code for the benefit of a bank against any or all of the directors of the bank or of any majority-owned subsidiary of the bank on account of the making of a distribution to any shareholder of the bank contrary to any provision of Article 3 (commencing with Section 1130) or any provision of Sections 501, 502, and 503 of the Corporations Code, to the same extent as a creditor of the bank who did not consent to the illegal distribution and who had a valid claim against the bank that arose prior to the time of the illegal distribution and exceeded the amount of the illegal distribution, may bring the action in the name of the bank.
(c)
As an alternative to the action provided for in subdivision (b), the commissioner may levy a civil penalty against the bank pursuant to Section 329.

Legislative History

Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.