CHANGES IN CAPITAL 
3. Restoring Impaired Capital —When the examination of a national 
bank shows that its losses exceed the amount of its surplus and un- 
divided profits, thus impairing its capital, the Comptroller sends a 
formal notice to the bank. A meeting of the shareholders, (who must 
be notified 30 days in advance) is called and at this meeting the 
shareholders must adopt one of the two courses that are open, viz.: 
(a) Voluntary liquidation. 
(b) Making up the deficiency by assessment of the bank’s stock. 
If voluntary liquidation is the course elected, the procedure is the 
same as outlined in the next chapter. (See “Liquidation,” page 48). 
When an assessment is agreed upon, (a majority stock vote being 
required to legalize the assessment) each shareholder pays in pro- 
portion to the number of shares he holds, and the entire sum must be 
paid in cash within three months after receipt of the Comptroller’s 
notice. A certificate, signed by the cashier of the bank and stating 
that payment has been completed, is sent to the Comptroller. 
If any shareholder refuses to meet the assessment levied upon his 
stock, the board of directors shall cause to be sold at public auction a 
sufficient amount of the delinquent shareholder’s stock to make good 
the deficiency. Before stock can be thus sold, however, 30 days’ 
notice must be given by posting notice of the sale in the bank office, 
and by publishing such notice in a local newspaper. 
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