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Savings Ban K

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SAVINGS BAN K. An institution in the nature of a bank, established for the purpose of receiving deposits of money, for the benefit of the persons depositing, to accumulate the produce of so much thereof as shall not be required by the depositors, their executors or administrators, at compound interest, and to return the whole or any part of such deposit, and the produce thereof to the depositors, their executors or administrators, deducting out of such produce so much as shall be re quired for the necessary expenses attending the management of such institution, but de riving no benefit whatever from any such deposit or the produce thereof. Grant. Bank., 5th ed. 262 ; Bolles, Banks & Dep. 177.

Savings banks are not banking institutions in the commercial sense of that phrase and are not to be classed as national banks in determining the validity of state taxation of the latter ; National Bank of Redemption v. Boston, 125 U. S. 60, 8 Sup. Ct. 772, 31 L. Ed. 689. See BANK.

Savings banks cannot do business as banks of discount unless by statute ; In re Jaycox, 12 Blatchf. 209, Fed. Cas. No. 7,237. It has been considered that savings banks are trus tees for depositors ; In re Newport Say. Bk., 68 Me. 396 ; Stockton v. Bank, 32 N. J. Eq. 163 ; and therefore subject to the jurisdic tion of equity ; In re Newark Say. Inst. Case, 28 N. J. Eq. 552 ; they have been held to be agents for the depositor ; Bunnell v. Say. Soc., 38 Conn. 203, 9 Am. Rep. 380 ; and debtors; People v. Say. Inst., 92 N. Y. 7; Reed v. Say. Bank, 130 Mass. 443, 39 Am. Rep. 468. That the rights of the depositors are of a two-fold character and occupy a po sition similar to that of stockholders in an ordinary corporation, see 1 Moraw. Corp. § 391; but as long as the institution is solvent the depositors are mere creditors; id.

Where the by-laws require the presenta tion of the pass-book, as a condition preced ent to the withdrawal of the deposit and this regulation is printed in the book, it be comes a part of the contract between the parties ; Peoples' Savings Bank v. Cupps, 91 Pa. 315; Kimins v. Say. Bank, 141 Mass. 33, 6 N. E. 242, 55 Am. Rep. 441. In case of the loss of the pass-book, the depositor has the right to receive his money without producing it ; Palmer v. Say. Inst., 14 R. I. 68, 51 Am. Rep. 341.

It has been held that after payment to one who was apparently in lawful possession of the pass-book, the real depositor cannot re cover unless upon proof of want of care on the part of the officers of the savings banks. See Smith v. Say. Bank, 101 N. Y. 58, 4 N. E. 123, 54 Am. Rep. 653. And even where the pass-book contains a stipulation that the deposit may be paid to any one who presents the book, the officers are still bound to use reasonable care ; Kimball v. Norton, 59 N.

H. 1, 47 Am. Rep. 171. A by-law that a savings bank shall not be liable to pay a de positor when it has already paid the holder of his pass-book which had been stolen, is not binding unless the depositor has notice of it; Ackenhausen v. Bank, 110 Mich. 175, 68 N. W. 118, 33 L. R. A. 408, 64 Am. St. Rep. 338.

In case of insolvency the assets are dis tributable among the depositors ; Roan v. Winn, 93 Mo. 503, 4 S. W. 736. In Re New ark Say. Inst. Case, 28 N. J. Eq. 552, the court made an order scaling down the de posits and authorized the savings bank to continue business. By statute in New York courts may scale down deposits of insolvent savings banks and authorize them to con tinue business.

The surplus of a savings bank belongs in equity to its depositors, and is a part of its deposits in the same sense as the stipulated interest is ; People v. Barker, 154 N. T. 122, 47 N. E. 1103.

A law providing that deposits which have remained unclaimed for thirty years, where the claimant is unknown or the depositor cannot be found, shall be paid to the state treasurer and receiver general to be held by him for the owner or his legal repre sentative, is constitutional ; Provident Insti tution for Savings v. Malone, 221 U. S. 660, 31 Sup. Ct. 661, 55 L. Ed. 899, 34 L. R. A. (N. S.) 1129.

The mere fact that a deposit stands in the depositor's name as "trustee" for another was held not ground for holding that an ir revocable trust was created, but to establish the creation of a "tentative" trust merely revocable by the depositoi in his lifetime ; In re Totten, 179 N. Y. 112, 71 N. E. 748, 70 L. R. A. 711, 1 Ann. Cas. 900. The transfer of the deposit and the bank book to another as trustee for a third person was held merely a tentative trust ; Lattan v. Van Ness, 107 App. Div. 393, 95 N. Y. Supp. 97; 19 H. L. R. 207.

A provision in a state tax statute except ing from an exemption banks, savings banks and trust companies is not an unconstitu tional discrimination against savings banks, the state court having held that there were reasonable grounds for the classification; Farmers' Bank v. Minnesota, 232 U. S. 517, 34 Sup. Ct. 354, 58 L. Ed.

Postojfice savings banks were established in England in 1861. Deposits are payable ten days after demand, with interest at the rate of two pounds ten shillings per cent. per an num. The deposits are paid over to the na tional debt commissioners and by them in vested in such securities as are lawful for the funds of other savings banks. Any defi ciency is made good out of the consolidated fund; 3 Steph. Corn. 88.

Postal savings banks have been establish ed in the United States; see POSTAL SAV INGS BANKS.