§ 6:1313 — Procedure upon the impairment of capital

A. If the commissioner finds from a report of examination or such other required report of a savings bank that the capital is impaired, he shall, in his discretion, institute whichever of the following procedures is appropriate:
(1) Direct that the board of directors either:
(a) Require the stockholders to contribute an amount at least sufficient to eliminate the impairment; or
(b) Reduce the par value of the capital stock in at least the amount of the impairment and allocate such reduction to undivided profits or reserves to absorb the loss which created the impairment.
(2) Take custody of the savings bank under Part X of this Chapter, establish a conservatorship, and proceed to merge, sell, or otherwise dispose of the savings bank in a manner which will remove the capital impairment, remove operating losses, and restore compliance with all capital requirements.
(3) Declare the stock worthless, and order the directors to cancel the stock or order the directors to sell, merge, or otherwise restructure the savings bank in a manner which will remove the capital impairment, eliminate operating losses, and restore compliance with all capital requirements.
B. The commissioner may promulgate rules to implement this procedure if necessary.

Legislative History

Acts 1990, No. 816, §1, eff. Sept. 1, 1990.