CHAPTER 131

BANKS, SAVINGS SOCIETIES AND TRUST COMPANIES

RESTRICTIONS ON THE BORROWING OF MONEY BY BANKS ON COLLATERAL

AN ACT TO AMEND ARTICLE 3 OF CHAPTER 66 OF THE REVISED CODE OF DELAWARE, 1935, RELATIVE TO "BANKS, SAVINGS SOCIETIES AND TRUST COMPANIES" BY PROVIDING RESTRICTIONS ON THE BORROWING OF MONEY BY BANKS ON COLLATERAL.

Be it enacted by the Senate and House of Representatives of the State of Delaware in General Assembly met:

Section 1. That 2306. Sec. 49, of Chapter 66 of the Revised Code of Delaware, 1935, be and the same is hereby amended by striking out the second paragraph of said section, and by substituting in lieu thereof the following:

No bank or trust company shall repledge or rehypothecate any property held by it in pledge or hypothecation as collateral which belongs to any other corporation or persons, unless such property is accompanied by the obligation of the original borrower from the institution.

Section 2. That 2300. Sec. 43, of Chapter 66 of the Revised Code of Delaware, 1935, be and the same is hereby amended by striking out the period after the word "credit" at the end of the second paragraph of sub-division (c) of said section, inserting in lieu thereof a semi-colon, and adding thereto the following:

nor shall said limitations or restrictions apply to any loan, discount, or extension of credit, heretofore or hereafter made, to the extent that any such loans, discounts, or extensions of credit, are secured or covered by guaranties, or by commitments, or agreements to take over or to purchase any such loans, discounts, or extensions of credit, made by any Federal Reserve Bank or by the United States or any department, bureau, board, commission or establishment of the United States, including any corporation wholly owned directly or indirectly by the United States; provided, however, that such guaranties, agreements, or commitments are unconditional and must be performed by payment of cash or its equivalent within sixty days after demand.

Approved March 23, 1943.