§ 242 — Assets; how entered and carried on books; disallowance by superintendent

§ 242. Assets; how entered and carried on books; disallowance by\nsuperintendent. 1. No savings bank shall by any system of accounting or\nany device of bookkeeping, directly or indirectly enter any of its\nassets upon its books in the name of any individual, partnership or\nunincorporated association or of any other corporation, or under any\ntitle or designation that is not truly descriptive thereof, except as\nauthorized by the provisions of this article.\n 2. The stocks, bonds, promissory notes or other interest-bearing\nobligations purchased by a savings bank shall be entered on its books at\nthe actual cost thereof, and shall not thereafter be carried upon the\nbooks at a valuation exceeding their cost as adjusted by amortization\nfor the purpose of bringing them to par at maturity; and where\nsecurities purchased at a premium are callable prior to maturity, the\nrate of amortization thereof shall be increased when necessary to such\nextent as shall reduce the amount at which such securities are carried\nupon the books to the call price at the date or dates upon which a call\nmay be made. No adjustment for amortization shall be required to be made\non the books except when the books are closed for the purpose of\ncomputing net earnings. The superintendent may by regulation vary the\nrequirements of this subdivision to permit the amortization of premiums\nat the same rate as that required by federal tax statutes or\nregulations.\n 3. No savings bank, without the written approval of the\nsuperintendent, shall enter on its books its real estate and the\nbuilding or buildings thereon, or its fixtures, vaults, furniture and\nequipment, at a valuation exceeding its actual cost to such savings\nbank, or carry such real estate, building or buildings, fixtures,\nvaults, furniture or equipment at a valuation exceeding the actual cost\nless appropriate allowance for depreciation. No adjustment for\ndepreciation shall be required to be made on the books except when the\nbooks are closed for the purpose of computing net earnings.\n 4. Real estate acquired by a savings bank, other than that acquired\nfor use as a place of business, shall be entered on the books of the\nsavings bank in conformity with the method of accounting for troubled\ndebt restructurings approved by the financial accounting standards board\nor such other method of accounting as may be authorized or required by\nrules and regulations of the superintendent of financial services.\n The provisions of this subdivision shall not, except as the\nsuperintendent may otherwise require, apply to any parcel of real estate\nas to which the savings bank has exercised its option to transfer or\nconvey such real estate to the veterans administration or the federal\nhousing commissioner pursuant to insurance or guaranty.\n 5. The superintendent may disallow the book value of any assets in\nwhole or in part. In such event the savings bank shall reduce the value\nat which such assets are carried on its books to the value allowed by\nthe superintendent, or, if the written approval of the superintendent is\nfirst obtained, may allocate a reserve for the valuation of such assets.\n