NRS 662.135 Limitations on investment in stock of or membership in other banks and business organizations.

479 words·~2 min read·/nv/chapter-662-powers-and-miscellaneous-provisions/662-135·

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

1. Except as otherwise provided in this section and subject to the provisions of NRS 662.065 and 662.125 , no bank may make any investment in the stock or become a member of any other state or national bank.

2. A bank doing business under chapters 657 to 671 , inclusive, of NRS may subscribe to or purchase, upon such terms as may be agreed upon, the stock of banks organized under the Act of Congress known as the Edge Act or the stock of central reserve banks whose stock exceeds $1,000,000.

3. To constitute a central reserve bank as contemplated by chapters 657 to 671 , inclusive, of NRS, at least 50 percent of the capital stock of the bank must be owned by other banks. The investment by any bank in the capital stock of a central reserve bank or a bank organized under the Edge Act, must at no time exceed 10 percent of the stockholders’ or members’ equity of the bank making the investment.

4. A bank shall not invest in the stocks or ownership of other corporations, firms, partnerships or companies except as otherwise provided in chapters 657 to 671 , inclusive, of NRS, unless the investment is made to protect the bank from loss.

5. A bank may invest in the stocks or ownership of other corporations, firms, partnerships or companies as part of a merger, consolidation, combination or acquisition that is authorized pursuant to the provisions of chapter 78 , 86 or 92A of NRS, regardless of whether the investment is made to protect the bank from loss.

6. Any stocks or ownership owned or acquired after July 1, 1971, in excess of the limitations imposed by this section must be disposed of at public or private sale within 12 months after the date of acquiring them, and if not so disposed of, they must be charged to profit and loss account, and no longer carried on the books as an asset. The limit of time in which such stocks or ownership is disposed of or charged off the books of the bank may be extended by the Commissioner if in his or her judgment it is for the best interest of the bank that an extension be granted.

7. A bank may subscribe to, purchase or become the owner of stock in:

(a)Federal reserve banks as established by Act of Congress approved December 23, 1913, being c. 6, 38 Stat. 251, or any amendment thereof; or

(b)Any governmental agency, Federal Home Loan Bank or liquidating or financial corporation created by the Congress of the United States.

8. A bank may invest up to 50 percent of its surplus in the stock or membership of corporations or limited-liability companies engaged in related banking fields.