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17:9A-25. Additional powers of banks.
25. Additional powers of banks.
In addition to the powers specified in section 24, every bank shall, subject to the provisions of this act, have the following powers, whether or not such powers are specifically set forth in its certificate of incorporation:
(1) To discount, buy, invest in, hold, assign, transfer, sell, and negotiate promissory notes, drafts, bills of exchange, mortgages, trade acceptances, bankers@ acceptances, bonds, debentures, bonds or notes secured by mortgages, installment obligations, balances due on conditional sales, and other evidences of debt for its own account, or for the account of customers;
(2) To accept for payment at future dates drafts drawn upon it by its customers;
(3) To issue letters of credit to guarantee the payment by its customers of amounts due or to become due upon the purchase by such customers of real or personal property;
(4) To receive interest and noninterest bearing demand and time deposits, to be repaid on such terms as may be agreed upon between the depositors and the bank, and to furnish security for such deposits when required by the laws of this State or of the United States, or by rules or orders of any court of this State or of the United States or by the regulations of an officer or agency of this State or of the United States, made pursuant to such law; provided that no bank shall be required to give security for deposits made by this State, or any political subdivision thereof, or any other body politic existing under the laws of this State, to the extent that such deposits are insured under any federal legislation providing for the insurance of bank deposits;
(5) To maintain savings departments for the receipt of interest and noninterest bearing deposits, to be repaid on such terms as may be agreed upon between the depositors and the bank, and to commingle such deposits with deposits otherwise received;
(6) During hours other than the bank@s usual hours for receipt of deposits, to provide the equipment for receiving, and to receive, containers purporting to contain moneys or instruments for the payment of money;
(7) To make loans, secured or unsecured, including loans to its stockholders;
(8) To extend credit by honoring overdrafts upon deposit accounts, but no credit shall be so extended except pursuant to written agreement made in advance;
(9) To buy and sell gold and silver bullion, foreign coin, and exchange;
(10) To purchase and sell debt and equity securities of other corporations, without recourse, solely upon order and for the account of customers. This paragraph shall not limit the power of a bank to take securities of other corporations as collateral security for loans, discounts, or other extensions of credit, or to acquire those securities when their acquisition is necessary to prevent or minimize loss upon debts previously contracted in good faith. Equity securities acquired pursuant to this paragraph shall be sold within five years after their acquisition, except that the commissioner may, by order, extend the time within which sales of equity securities described in such order shall be made; but this paragraph shall not invalidate the holding of any equity securities lawfully acquired on or before the effective date of this act. This paragraph shall not apply to any case in which, pursuant to any other provision of this act, or pursuant to any other act, a bank is expressly authorized to subscribe for, purchase or otherwise acquire or hold securities;
(11) To receive any tangible personal property for safekeeping and storage on the terms provided by chapter 7 of Title 12A of the New Jersey Statutes, and to keep, maintain, and rent out for hire, space for the storage and safekeeping of personal property of such kind and description, or represented by the depositor thereof to be of such kind and description, as the commissioner may by regulation from time to time prescribe; but nothing herein contained shall limit the power of a bank to let space for the storage and safekeeping of personal property to which the bank has security title or in which it has a lien interest;
(12) To avail itself of the provisions of any federal legislation providing for the extension of any lawful banking activity in the making of loans or the extension of credit to individuals, or for the financing of business enterprises, or in such other banking activity as may be specified in such legislation and made available for participation by banks; except that the power by this paragraph conferred shall not be exercised unless the commissioner shall make a general order authorizing such participation upon such terms and conditions as may in such order be prescribed;
(13) To act as the fiscal agent of the United States, and of any corporation, and of any State, county, municipality, board, commission or other body politic, and to perform all duties as such fiscal agent as may lawfully be required of it;
(14) To assist customers or act for customers in the preparation, handling and disbursement of payrolls and payroll deductions and in the preparation, maintenance and furnishing of records and statistical information in connection therewith.
L.1948,c.67,s.25; amended 1962, c.219, s.1; 1985, c.528, s.3; 1997, c.395, s.10.
17:9A-25.1. Banks; retirement benefits for officers and employees
A bank may pay retirement and other benefits to its officers and employees in the manner provided by the Banks@ and Savings Banks@ Officers@ and Employees@ Retirement and Benefit Act.
L.1948, c. 67, p. 208, s. 25.1. Amended by L.1950, c. 288, p. 958, s. 1; L.1953, c. 124, p. 1310, s. 1.
17:9A-25.2. Regulations authorizing loans not authorized by L.1948, c. 67; power of commissioner
The Commissioner of Banking and Insurance shall have power to make, amend and repeal regulations authorizing banks to make specified kinds of loans or investments not authorized by the act to which this act is a supplement, or not otherwise authorized; except that the commissioner shall not make or continue in force any regulation authorizing banks to make any kind of loan or investment which national banks are not authorized to make.
L.1966, c. 279, s. 1, eff. Sept. 6, 1966.
17:9A-25.3. Preservation of dual banking system
In exercising the power conferred upon him by this act, the commissioner shall consider the statutes, regulations and rulings governing the lending and investing powers of national banks, and the regulations made by him shall have as their objective the placing of banks on a substantial competitive parity with national banks, in order that the dual banking system may be preserved.
L.1966, c. 279, s. 2.
17:9A-25.4. Banks defined
As used in this act, ~banks~ means banks, other than savings banks, organized and operating under the laws of this State.
L.1966, c. 279, s. 3.
17:9A-25.5. Additional powers of banks
A. In addition to the powers which banks may otherwise exercise, every bank, as defined in the act to which this act is a supplement, shall have the following powers, whether or not such powers are specifically set forth in its certificate of incorporation:
(1) To disburse to customers@ employees, payroll funds deposited with it by such customers for such purpose, either by direct payment to such employees on or away from the banking premises, or by crediting an account standing in an employee@s name in such bank;
(2) To provide and receive compensation for travel services rendered to its customers and others, including the sale of trip insurance and the rental of automobiles as agent for a local rental service;
(3) To provide customers with messenger service by means of armored car or otherwise. In such a case, the messenger shall be the agent of the customer, and any deposits collected by such agent shall be deemed not to be received by the bank until delivered at the bank to an employee authorized to receive deposits;
(4) To designate bonded agents to sell money orders of the bank away from the banking premises;
(5) To become the owner and lessor of personal property upon the request of and for the use of a customer, and to incur such obligations as may be incidental to such ownership;
(6) To purchase open accounts;
(7) To extend credit through the use of credit cards issued by it through an arrangement with participating vendors, and without limitation of the generality of the foregoing, to exercise all the powers permitted to associations pursuant to subsection 18 of section 48 of the ~Savings and Loan Act (1963),~ P.L.1963, c. 144 (C. 17:12B-48);
(8) To make any investment authorized for associations by Section 165 of the ~Savings and Loan Act (1963),~ P.L.1963, c. 144 (C. 17:12-165), provided, however, that where reference is made to State associations or Federal associations therein, such reference for purposes of this act shall be deemed to refer to banking institutions as defined in section 1 of ~The Banking Act of 1948,~ P.L.1948, c. 67;
(9) To exercise all other powers, not herein specifically enumerated, which are reasonably related or incidental to the exercise of the foregoing powers.
B. The commissioner may, by regulation, prescribe the manner in which and the extent to which the foregoing powers may be exercised, and may, by regulation, prescribe other powers, not otherwise expressly authorized or prohibited, which banks may exercise. Regulations so made shall be directed toward creating or maintaining substantial equality between State-regulated and Federally-regulated banks, to the end that no class or group of banks shall have any substantial competitive advantage over another.
L.1969, c. 244, s. 5, eff. Dec. 23, 1969. Amended by L.1981, c. 153, s. 3, eff. May 22, 1981.
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