17:9A-208. Surplus; determination by savings bank

A. For the purpose of determining the surplus of a savings bank from time to time, the board of managers shall value the assets of the savings bank as follows:

(1) all bonds, notes and other obligations for the payment of money not in default as to principal or interest for more than one month, other than mortgage loans, shall be valued at the cost thereof to the savings bank, less, if the cost exceeds the face value thereof, an amount at least equal to the sum of (a) periodical amortization of such excess in an amount sufficient to reduce such cost to the face value thereof at the maturity thereof, and (b) additional amortization sufficient to reduce such cost to the price at which the same is redeemable at the time being or, if not then redeemable, at the earliest redemption date;

(2) mortgage loans shall be valued at the amount due thereon, unless in default, according to their terms, for more than three months;

(3) all bonds, notes and other obligations for the payment of money, other than mortgage loans, if in default as to principal or interest for more than one month, and all mortgage loans, if in default, according to their terms, for more than three months, and all other assets not otherwise specified in this section, shall be valued at such amounts as shall be determined by the board of managers to represent the true value thereof, not in excess of cost; and

(4) real property held by a savings bank in accordance with subparagraph (a) of paragraph (5) of section 24, and all fixtures, furniture and equipment, shall be valued at an amount not in excess of cost less depreciation, or, if cost is not ascertainable, at such amount as shall be determined by the board of managers to represent the true value thereof; provided, that in lieu of such valuation of the assets specified under the foregoing paragraphs (3) and (4) of this subsection, the board of managers may establish specific or general valuation reserves applicable thereto in amounts equal to the excess of the book value thereof on the books of the savings bank over such true value.

B. This section shall not affect

(1) the power of the commissioner to order a savings bank (a) to increase any valuation reserve established pursuant to subsection A of this section or (b) to write down any asset valued in the manner required by this section, if, upon due consideration, he finds that (i) such reserve is insufficient, or (ii) the values determined by the board of managers do not represent true value, or (iii) conditions are such that the valuation of assets in the manner required by any provision of this section would constitute transacting business in an unsafe manner; or

(2) the power of the board of managers to establish valuation or other reserves applicable to specific assets or groups or classes of assets in such amounts as the board of managers may from time to time determine, notwithstanding that such assets have been valued in the manner required by this section; or

(3) the commissioner in the exercise of the powers conferred by section 265.

L.1948, c. 67, p. 346, s. 208.