13-3-201. Acquisition of real estate.

(a) No bank shall purchase, hold, convey or lease real estate except for the following purposes:

(i) Real estate and buildings necessary to transact the business of a bank including its banking offices and other premises in the same buildings to rent as a source of income. The property shall not be carried on the books of the bank as an asset in an amount in excess of one hundred percent (100%) of the bank's capital and surplus and, with the prior approval of the state banking commissioner, undivided profits and reserve accounts. When any bank ceases to use the real estate and improvements for banking purposes, it shall, within five (5) years from the date of vacation of the premises, sell the property;

(ii) Real estate which is purchased by or conveyed to the bank in satisfaction of or on account of debts previously contracted in the course of its business;

(iii) Real estate which is purchased at execution sale or acquired by decree under securities held by it.

(b) Any real estate acquired as provided in subsections (a)(ii) and (iii) of this section shall be entered on the books as other real estate at not more than acquisition cost, or appraised fair market value, whichever is less, shall be appraised at least every twenty-four (24) months, and shall be sold within ten (10) years after title to the property is acquired. Any real estate acquired prior to July 1, 1992 shall be carried on the bank's books at the lower of the bank's book value for that property as of July 1, 1992 or appraised value.

(i) Repealed by Laws 1992, ch. 46, § 2.

(ii) Repealed by Laws 1992, ch. 46, § 2.

(c) If any real estate is not sold within the time required in this section, it shall not thereafter be carried as an asset of the bank. This section shall not apply to real estate purchased with funds other than the capital and resources of the banking business nor to real estate held in trust.

(d) Any bank acquiring any real estate in any manner other than as provided by this section shall immediately charge it to a reserve for losses or to undivided profits.

(e) Any appraisal required under subsection (b) of this section for property which is carried on the bank's books at a value equal to or exceeding two hundred fifty thousand dollars ($250,000.00) shall be conducted by a real estate appraiser certified or licensed by the state in which the property is located, who is not an officer or director of the bank and whose reports are acceptable to the state banking commissioner.

(f) Any appraisal required under subsection (b) of this section may be waived by the state banking commissioner upon written application from the bank.