Limitation on declaring dividend or making distribution; exception.
1. As used in this section, “net profits” means the remainder of all earnings from operations plus actual recoveries on loans and investments and other assets, after deducting from the total thereof all operating expenses, actual losses, transfers to reserve for loan losses, and all federal and state taxes.
2. Except as otherwise provided in subsection 3, the directors of any state bank shall not declare a dividend or make a distribution of the net profits of the bank until:
(a) The surplus fund of the bank equals its initial stockholders’ or members’ equity, not including its initial surplus fund;
(b) There has first been carried to the surplus fund 10 percent of the previous year’s net profit; and
(c) The bank complies with the requirements set forth in NRS 661.025.
3. Except as otherwise provided in NRS 661.240, the directors of a state bank that maintains the issuance of deposits required pursuant to the provisions of the Federal Deposit Insurance Act, 12 U.S.C. §§ 1811 et seq., may declare a dividend or make a distribution of so much of the net profits of the bank as they determine is expedient.
Last modified: February 26, 2006