§ 3-304. Loans on and acquisitions of own stock prohibited

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   (a) General rule. -- Except as necessary to prevent a loss on a loan previously made in good faith, a commercial bank may not:

   (1) Make any loan secured by any of its outstanding capital stock; or

   (2) Buy or hold any of its outstanding capital stock.

(b) Required disposition. -- If a commercial bank buys or holds any of its outstanding capital stock, the commercial bank shall sell the stock at public or private sale within:

   (1) 1 year after the date of acquisition; or

   (2) Any longer period that the Commissioner authorizes.

HISTORY: An. Code 1957, art. 11, § 80; 1980, ch. 33, § 2; 1996, ch. 326, § 2.

                    
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