Sec. 36a-264. (Formerly Sec. 36-68). Loans secured by own stock or stock of holding company prohibited. Exception. - Connecticut Statutes

      Sec. 36a-264. (Formerly Sec. 36-68). Loans secured by own stock or stock of holding company prohibited. Exception. A capital stock Connecticut bank shall not make any loan on or discount any paper secured by a pledge of its own stock or of the stock of a holding company of which such bank is an affiliate, unless such pledge shall be necessary to prevent loss upon a debt previously contracted by such bank in good faith.

      (1949 Rev., S. 5792; 1969, P.A. 504, S. 20; P.A. 83-273, S. 1, 2; P.A. 85-379, S. 5; P.A. 94-122, S. 121, 340.)

      History: 1969 act prohibited pledge of stock of bank holding company of which company in question is an affiliate as security for loan, etc. and defined "bank holding company"; P.A. 83-273 allowed state banks and trust companies to accept pledges of their own stock or that of their bank holding company as security for loans if the pledge is necessary to prevent loss on a previously existing debt; P.A. 85-379 replaced references to "bank and trust company" and "banks" with references to "capital stock bank" and "capital stock banks" and replaced references to "bank holding company" with references to "holding company"; P.A. 94-122 made technical changes, effective January 1, 1995; Sec. 36-68 transferred to Sec. 36a-264 in 1995.

      Annotations to former section 36-68:

      Refers to specific pledge not inconsistent with lien for stockholder's debt. 26 C. 157. Prohibition of loans on its stock implies prohibition of purchase of stock by corporation. 52 C. 99. Corporation is forbidden by implication to purchase its stock. Id.