§ 36a-218 — (Formerly Sec. 36-31). Order to make good impairment of capital. Application for appointment of receiver.

Whenever the commissioner has reason to believe that the capital of any capital stock Connecticut bank is impaired but the impairment is not sufficient to require other action for the protection of the public, the commissioner may notify such bank in writing to make good any impairment of capital within a time to be fixed by the commissioner. For purposes of this section, the capital of a bank is impaired if the equity capital of the bank is less than zero. At the end of such period, the commissioner shall make, or cause to be made, an examination of such bank, and, upon finding at any time thereafter an impairment of capital, the commissioner may deliver to such bank a written order to discontinue receiving moneys for deposit or for certificates of indebtedness and paying depositors, clients or other creditors. The commissioner may thereupon bring an action in the superior court for the judicial district of Hartford or the judicial district in which the main office of such bank is located for its dissolution and for the appointment of a receiver to take charge of its affairs. Such written order of the commissioner, until vacated by an order of the court, shall have the effect of a temporary injunction restraining such bank, its directors, officers and employees, from receiving moneys for deposit or for certificates of indebtedness and paying depositors, clients or other creditors. Nothing in this section shall require the commissioner to take any action for the restoration of any impairment of capital or for the appointment of a receiver if, in the commissioner's opinion, the remaining capital of any such bank is sufficient to protect the depositors, clients and other creditors thereof from loss.

Legislative History

(1949 Rev., S. 5756; P.A. 78-280, S. 2, 127; P.A. 88-65, S. 16; 88-230, S. 1, 12; P.A. 90-98, S. 1, 2; P.A. 93-142, S. 4, 7, 8; P.A. 94-122, S. 93, 340; P.A. 95-220, S. 4–6; P.A. 96-271, S. 204, 254; P.A. 04-136, S. 11.) History: P.A. 78-280 substituted “judicial district” for “county”; P.A. 88-65 narrowed the application of the section to exclude industrial banks; P.A. 94-122 allowed the commissioner to apply to the Hartford-New Britain superior court to appoint a receiver and made technical changes, effective January 1, 1995 (Revisor's note: P.A. 88-230, P.A. 90-98 and P.A. 93-142 authorized substitution of “judicial district of Hartford” for “judicial district of Hartford-New Britain” in the public and special acts of the 1994 regular and special sessions, effective September 1, 1996); Sec. 36-31 transferred to Sec. 36a-218 in 1995; P.A. 95-220 changed the effective date of P.A. 88-230 from September 1, 1996, to September 1, 1998, effective July 1, 1995; P.A. 96-271 provided that the capital of a bank is impaired “if the equity capital of the bank is less than zero” rather than “if the assets of the bank are not sufficient to equal the amount of its indebtedness added to any stated capital, as defined in subsection (w) of section 33-284”, effective January 1, 1997; P.A. 04-136 inserted references to “clients”, effective May 12, 2004. Annotation to former section 36-31: Cited. 115 C. 534.