CHAPTER 522

An Act to amend and reenact § 6-51, as amended, of the Code of Virginia,
relating to investments of banks.
[H 486]

Approved March 31, 1960

Be it enacted by the General Assembly of Virginia:

1. That § 6-51, as amended, of the Code of Virginia, be amended and
reenacted as follows:

§ 6-51. No bank shall acquire or own its own stock except to pro-
tect itself against loss from debts previously contracted, in which case it
shall be disposed of within twelve months from the time acquired. No
bank shall make loans collaterally secured by the stock of such bank. No
bank shall invest any of its funds in shares of stock of any other corpora-
tion nor in any notes or other obligations secured by real estate on which
as security it is prohibited by §§ 6-78 and 6-79 from making any loan;
this provision shall not, however, prevent any bank, (1) from acquiring
any such stock, notes or other obligations to protect itself or any fund in
its custody or possession against loss from debts theretofore contracted,
nor (2) from acquiring, owning and holding stock of a building corpora-
tion of the character and to the amount provided by § 6-49, nor (3) from
acquiring, owning and holding stock of an agricultural credit corporation
organized under the laws of this State, provided that the total amount of
such stock shall not exceed twenty per centum of the amount of the capital
stock of such bank actually paid in and unimpaired, plus the amount of
its unimpaired surplus fund, nor (4) from acquiring, owning and holding
stock of Federal National Mortgage Association, nor (5) from acquiring,
owning and holding stock of a small business investment company as
defined by the Federal Small Business Investment Act of 1958, nor (6)
from acquiring, owning and holding stock of an industrial development
company organized under the provisions of the Virginia Industrial Devel-
opment Corporation Act; nor shall the provisions hereof be construed to
require a bank to dispose of any preferred stocks lawfully acquired as an
investment prior to the first day of January, nineteen hundred and forty.
2. An emergency exists and this act is in force from its passage.