Section 31 Reserve - Massachusetts Statutes

Section 31. A. Except as otherwise provided in this chapter, every trust company shall at all times maintain, as a reserve, an amount equal to fifteen per cent of the total of its demand and time deposits withdrawable within thirty days computed on a weekly average basis.

No reserve shall be required for savings deposits and time deposits not withdrawable within thirty days.

B. The composition of the reserve shall be as follows:

1. Lawful currency of the United States, silver certificates or notes and bills issued by a federal reserve bank. Not less than fifteen per cent.

2. Bonds, notes, bills and certificates of indebtedness of the commonwealth, its political subdivisions or of the United States, computed at their current market value, which are unpledged and the absolute property and under the control of the corporation. Not more than eighty per cent.

3. Balance payable on demand due from any member of the federal reserve system located in this commonwealth or in any reserve city, as designated by or under authority of an act of Congress, or from any trust company insured by the Federal Deposit Insurance Corporation and located in the commonwealth; or from any trust company located in the commonwealth having capital stock and surplus accounts aggregating at least ten million dollars. Not more than eighty per cent.

C. The commissioner may, from time to time and in his discretion, increase or decrease the percentage required by subsection A hereof.

D. The treasurer or other officer or employee charged with the functions or duties usually performed by the treasurer shall report in writing to the commissioner, once in each week, the amount and composition of the reserve for each business day of the preceding week. Whoever violates this subsection shall be punished by a fine of not more than one thousand dollars or by imprisonment for not more than one year, or both.