81-14-211 - Involuntary liquidation. - Mississippi Statutes

§ 81-14-211. Involuntary liquidation.
 

(1)  The commissioner may take custody of the books, records and assets of every kind of any savings bank organized and operated under the provisions of this chapter for any of the purposes hereinafter enumerated if it reasonably appears from examinations or from reports made to the commissioner that: 

(a) The directors, officers or liquidators have neglected, failed or refused to take such action which the commissioner may deem necessary for the protection of the savings bank, or have impeded or obstructed an examination; or 

(b) The net worth of the savings bank is impaired to the extent that the realizable value of its assets is insufficient to pay in full its creditors and holders of deposit accounts; or 

(c) The business of the savings bank is being conducted in a fraudulent, illegal or unsafe manner, or that the savings bank is in an unsafe or unsound condition to transact business; (any savings bank which, except as authorized in writing by the commissioner, fails to make full payment of any withdrawal when due is in an unsafe or unsound condition to transact business, notwithstanding such provisions of the certificate of incorporation or such statutes or regulations with respect to payment of withdrawals in event a savings bank does not pay all withdrawals in full); or 

(d) The officers, directors or employees have assumed duties or performed acts in excess of those authorized by statute or regulation or charter, or without supplying the required bond; or 

(e) The savings bank has experienced a substantial dissipation of assets or earnings due to any violation of statute or regulation, or due to any unsafe or unsound practice or practices; or 

(f) The savings bank is insolvent, or is in imminent danger of insolvency, or has suspended its ordinary business transactions due to insufficient funds; or 

(g) The savings bank is unable to continue operations. 

(2)  Unless the commissioner finds that such an emergency exists which may result in loss to members, deposit account holders, stockholders or creditors, and which requires that he take custody immediately, the commissioner shall first give written notice to the directors and officers specifying the conditions criticized and allowing a reasonable time for corrections before a receiver shall be appointed. 

(3)  The purpose for which the commissioner may take custody of a savings bank include, but are not limited to, examination or further examination, conservation of its assets, restoration of impaired capital, and the making of any reasonable or equitable adjustment deemed necessary by the commissioner under any plan of reorganization. 

(4)  If the commissioner, after taking custody of a savings bank, finds that one or more of the reasons for having taken custody continues to exist through the period of his custody with little or no likelihood of amelioration of the situation, then he shall appoint as receiver or co-receiver any qualified person, firm or corporation for the purpose of liquidation of the savings bank. Such receiver shall furnish bond in form, amount and with surety as the commissioner may require. The commissioner may appoint the institution's deposit account insurance corporation or its nominee as the receiver. Such insuring corporation shall be permitted to serve without posting bond. 

(5)  In the event the commissioner appoints a receiver for a savings bank, he shall mail a certified copy of the appointment order by certified mail to the address of the savings bank, as it appears on the records of the department, to any previous receiver or other legal custodian of the savings bank and to any court or other authority to which such previous receiver or other legal custodian is subject. Notice of such appointment may be published in a newspaper of general circulation in the county where the savings bank has its principal office. 

(6)  Whenever a receiver for a savings bank is appointed pursuant to subsection (4), the savings bank may within thirty (30) days thereafter bring an action in the chancery court in the county in which the home office of the institution is located for an order to remove such receiver. 

(7)  The duly appointed and qualified receiver shall take possession promptly of such savings bank in accordance with the terms of the appointment by service of a certified copy of the commissioner's appointment order upon the savings bank at its principal office through the officer or employee who is present and appears to be in charge. Immediately upon taking possession of the savings bank, the receiver shall take possession and title of books, records and assets of the savings bank. The receiver, by operation of law and without any conveyance or other instrument, act or deed, shall succeed to all the rights, titles, powers and privileges of the savings bank, its members or stockholders, holders of deposit accounts, its officers and directors, and to the titles of the books, records and assets of any previous receiver or other legal custodian of the savings bank. Such members, stockholders, holders of deposit accounts, officers or directors shall not thereafter, except as hereinafter expressly provided, exercise any such rights, powers or privileges, or act in connection with any assets or property of any nature of the savings bank in receivership. The commissioner may at any time direct the receiver to return the savings bank to its previous or newly constituted management. The commissioner may provide for a meeting of the members or stockholders for any purpose, including the election of directors or an increase in the number of directors, or both, or the election of an entire new board of directors for any purpose, including the filling of vacancies on the board, the removal of officers and the election of new officers. Any such meeting of members or stockholders, or of directors, shall be supervised or conducted by a representative of the commission. 

(8)  A duly appointed and qualified receiver shall have authority to: 

(a) Demand, sue for, collect, receive and take into his possession all the goods and chattels, rights and credits, monies and effects, lands and tenements, books, papers, choses in action, bills, notes and property of every description of the savings bank; 

(b) Foreclose mortgages, deeds of trust and other liens executed to the savings bank to the extent the savings bank would have had such right; 

(c) Institute suits for the recovery of any estate, property, damages or demands existing in favor of the savings bank, and shall, upon his own application, be substituted as plaintiff in the place of the savings bank in any suit or proceeding pending at the time of his appointment; 

(d) Sell, convey and assign all the property rights and interest owned by the savings bank; 

(e) Appoint agents to serve at his pleasure; 

(f) Examine and investigate papers and persons, and pass on claims as provided in the regulations prescribed by the commissioner; 

(g) Make and carry out agreements with the insuring corporation or with any other financial institution for the payment or assumption of the savings bank's liabilities, in whole or in part, and to sell, convey, transfer, pledge or assign assets as security or otherwise and to make guarantees in connection therewith; and 

(h) Perform all other acts which might be done by the employees, officers and directors; such powers shall be continued in effect until liquidation and dissolution, or until return of the savings bank to its prior or newly constituted management. 

(9)  A receiver may at any time during the receivership and prior to final liquidation be removed and a replacement appointed by the commissioner. 

(10)  The commissioner may determine that such liquidation proceedings should be discontinued. He may then remove the receiver and restore or grant all the rights, powers and privileges of its members and stockholders, customers, employees, officers and directors, or newly constituted management. The return of a savings bank to its management or to a newly constituted management from the possession of a receiver shall, by operation of law and without any conveyance or other instrument, act or deed, vest in the savings bank the title to all property held by the receiver in his capacity as a receiver for the savings bank. 

(11)  Claims against a state savings bank in receivership shall have the following order of priority for payment: 

(a) Costs, expenses and debts of the savings bank incurred on or after the date of the appointment of the receiver, including compensation for the receiver; 

(b) Claims of holders of deposit accounts; 

(c) Claims of general creditors; 

(d) Claims of stockholders of a stock savings bank; 

(e) All remaining assets to members and stockholders in an amount proportionate to their holdings as of the date of the appointment of the receiver. 

(12)  All claims of each class of priority described in subsection (11) shall be paid in full so long as sufficient assets remain. Members of the class for which the receiver cannot make payment in full because assets will be depleted shall be paid an amount proportionate to their total claims. 

(13)  The commissioner shall have the authority to direct the payment of claims for which no provision is herein made, and may direct the payment or claims within a class. The commissioner shall have the authority to promulgate rules and regulations governing the payment of claims by an institution in receivership. 

(14)  When all assets of the savings bank have been fully liquidated, all claims and expenses have been paid or settled and the receiver has recommended a final distribution, the dissolution of the savings bank in receivership shall be accomplished in the following manner: 

(a) The receiver shall file with the commissioner a detailed report, in a form to be prescribed by the commissioner, of his acts and proposed final distribution and dissolution. 

(b) Upon the commissioner's approval of the final report of the receiver, the receiver shall provide such notice, and thereafter shall make such final distribution, in such manner as the commissioner may direct. 

(c) When a final distribution has been made, except as to any unclaimed funds, the receiver shall deposit such unclaimed funds with the commissioner and shall deliver to the commissioner all books and records of the dissolved institution. 

(d) Upon final dissolution of the savings bank in receivership or at such time the receiver is relieved of his duties, the commissioner shall cause an audit to be conducted, during which the receiver shall be available to assist. The accounts of the receiver shall then be ruled upon by the commissioner and, if approved, the receiver shall thereupon be given a final and complete discharge and release. 
 

Sources: Laws,  1992, ch. 489, § 59; Laws, 1994, ch. 622, § 154; reenacted without change, Laws,  1997, ch. 364, § 61; reenacted without change, Laws, 2001, ch. 457, § 61, eff from and after July 1, 2001.