A bank may, with the approval of its board, determine and from time to time redetermine the par value of any class or series of its shares unless its articles provide that such shares shall have par value and specify the par value of such shares.
Corporate RequirementsShares
Section § 1120
This law allows a bank to set or change the par value—the minimum price—of its shares, as long as the bank's board approves. The exception is if the bank's foundational documents (its articles) already set a fixed par value.
bank shares par value board approval
Section § 1121
This law states that banks and trust companies are not allowed to issue shares unless those shares have been completely paid for, and this rule has been in effect since October 1, 1949.
No bank or trust company after October 1, 1949, shall issue any shares before they are fully paid for.
bank shares trust company shares fully paid shares
Section § 1122
This law states that banks can't give out shares in exchange for either the services someone provided while setting up the bank or as payment with a promissory note from the person buying the shares.
No bank shall issue any shares in consideration of:
(a)CA Financial Code § 1122(a) Services rendered in the organization of such bank; or
(b)CA Financial Code § 1122(b) Any note (whether or not negotiable and whether or not secured) made by the purchaser of such shares.
bank shares issuance services rendered bank organization
