(a)
(1) A state bank may make a loan secured by not more than fifty percent (50%) of the book value of its own stock upon the approval of a majority of the bank's board of directors; provided, that this subsection (a) shall not permit a purchase money loan for the initial acquisition of the bank's own stock. Loans secured by the bank's own stock shall be limited to and shall not exceed:
(A) In the aggregate, twenty percent (20%) of the bank's capital, surplus and undivided profits; or
(B) To any one (1) borrower, ten percent (10%) of the bank's capital, surplus and undivided profits.
(2) A loan that is otherwise adequately secured to the extent required of loans of the type provided and in which the bank's stock is taken as additional or secondary collateral shall not be included in the limits provided in this subsection (a).
(b)
(1) Except as expressly limited or restricted in this title, a state bank may engage in transactions involving its own stock, including, but not limited to, the transfer, repurchase, holding, sale or division, to the same extent permitted to corporations under the Tennessee Business Corporation Act, compiled in title 48, chapters 11-27.
(2) The bank shall give the commissioner thirty (30) days' advance notice of any proposed transaction and may consummate the transaction at the end of the thirty-day period unless the commissioner advises the bank in writing of the commissioner's objection to the proposed transaction.
Copyright ©2024 LegalFix. All rights reserved. LegalFix is not a law firm, is not licensed to practice law, and does not provide legal advice, services, or representation. The information on this website is an overview of the legal plans you can purchase—or that may be provided by your employer as an employee benefit or by your credit union or other membership group as a membership benefit.
LegalFix provides its members with easy access to affordable legal services through a network of independent law firms. LegalFix, its corporate entity, and its officers, directors, employees, agents, and contractors do not provide legal advice, services, or representation—directly or indirectly.
The articles and information on the site are not legal advice and should not be relied upon—they are for information purposes only. You should become a LegalFix member to get legal services from one of our network law firms.
You should not disclose confidential or potentially incriminating information to LegalFix—you should only communicate such information to your network law firm.
The benefits and legal services described in the LegalFix legal plans are not always available in all states or with all plans. See the legal plan Benefit Overview and the more comprehensive legal plan contract during checkout for coverage details in your state.
Use of this website, the purchase of legal plans, and access to the LegalFix networks of law firms are subject to the LegalFix Terms of Service and Privacy Policy.