California Financial Code

§ 1515

FIN § 1515 Effective Jan 1, 2014Div. 1.1 · Ch. 14 · Art. 4

Statute text

A bank or trust company may acquire stock in settlement or reduction of a loan or in exchange for an investment previously made in good faith where the acquisition of the stock is necessary in order to minimize or avoid loss arising out of the loan or investment. The limitation in Section 1510 shall not apply to the stock acquired in accordance with this section. Whenever any stock that is acquired in accordance with this section can be sold for an amount sufficient to reimburse the bank or trust company for all loss arising out of the loan for which the stock was security or arising out of the original investment by the bank or trust company, the bank or trust company shall sell the same or shall convert the stock to an investment subject to Section 1510.

Legislative history

Amended by Stats. 2013, Ch. 334, Sec. 40. (SB 537) Effective January 1, 2014.