GERAlDC.MANN
                       Avnx-IN 1Z.TP.XAS



  HonorableJohnQ.ldoAdame
  ‘Ccmuais~ioner,
                Departmentof Banking
  Auetln, Texae

  Dear Mr. I&Adams:                    OpinionNo. O-5451-A
                                       Re: Authorityof NationalBanking
                                           Associationsto establish
                                           bankingfacilitiesin military
                                           camps and naval yards under
                                           Section 10, of PublicLaw 603,
                                           of the~77th Congress,ale0
                                           whetherState charteredbanks
                                           are given such authorityunder
                                            thle statuta.

            You requestour opinionwith respectto the mattersmentioned
   in your letterae follows:

            "An opinionfrom your office is requestedconcerning
       the authorityof nationalbanks in establishingbanking
       facilitiesin militarycamps and naval yards,allegedto
       have been providedby Section 10 of Public'Law 603 of the
       77th Congress;also whetherState charteredFederalBeeeme
       Member banka and those non-memberinsuredState banke are
       given equal authorityunder this statutewith those oper-
       ating under nationalcharter."

             In opinionNo. O-5451under date of July 26, 1943, we advised
   you with respectto the above cited subjectmatter aeeumlngthat S 1603
   (U.S.C.Title 12, section36) had been duly enacted,but which now appears
   to be not the caee. In truth S 1.603was defeatedin the Congrese.

            Section 265, Title 12, U.S.C.Annotated,which Is the Act
   referredto In your present inquiryand which wae paeeedJune 11, 1942,
   la aa follows:

            "All insuredbanks designatedfor that purposeby the
       Secretaryof the Treaeuryshall be depositariesof public
       money of the United Statee (inaluding, withoutbeing limited
       to, revenueeand funds of the United States,and any funds
       the depositof which ie subject to the controlor regulntion
       of tie United States or any of 1t.aoffioere,agents,or
       employees,and Poetal Savings funds),and the Secretaryis
HonorableJohn Cl.l&Adams,Page 2 (O-5451-A)



    hereby authorizedto depositpub110money in su+dapbsitar$ee,
    under euoh regulationeas may be preeoribedby tie Sdoretary;'
    and they may also be employed(LBfinanoialagenteof the
    Government;and they shall performall euoh reaeonabledutiee,
    a6 depoeltarleeof publiomoney and finanoialageti$e   of the
    ,Oovermentae may be requiredof them. The Secretaryof
    the Treasuryshall requireof the insuredbanke thus deeig-
    nated satiefaotorysecurityby the depoeitof Udited States
    bonde or otherwise,for the safekeepingand prompt payment
    of publicyney depositedwith than and for the falthfil
    perfonuanoeof their duties as finanoialagente of the
    Coveroment:provided,That no such securityshall be required
    for the safekeepingand prompt paymentof euoh parte of the
    depoalteof the publionioneyin such banke as are insured
    depoaitaand eaoh offiaer,employee,or agent of the United
    States having offloialcuetadyof public funds and lawfully
    depositingthe seme in ah insuredbank shall, for the purpose
    of determiningthe amount of the ineureddeposits,be deemed
    a depositorin such ouetodialoapaoltyseparateand dietimt
    from any other offioer,employee,or agent of the United
    States having officialcustodyof publio funds and lawfully
    depositingthe eame in the came ineuredbank in ouatodlal
    capacity. Wotwlthetanding  any other provisionof law, no
    department;,board, agency, instrunentality, officer,employee,
    or agent of the United States ahall leeue or permit to
    continuein effect any regulations,rulings,or lnetxuctione,
    or enter into or approveany dontractsor performany other
    aote having to do with the deposit,diebureement,or expendl-
    ture of public funds,or the deposit,ouetody,or advanceof
    funds subjectto the controlof the United Statee ae,truetee
    or otherwieewhich ehalldiecrlmlnateagain&,or prefer
    nationalbankingassociations,   State banks membereof the
    FederalReserve System,or insuredbanke not members of the
    FederalReseme System,by olaee, or which shall require those
    enjoyingthe benefits,directlyor indlreotly,of dlebureed
    pub110 funds 80 to discriminate.All Aote or parts tier&of
    in conflictherewithare hereby repealed. The terms 'lneured
    hank' and 'insureddeposit'ae used in this sectionehall
    be oonetruedaccordingto the defiultioneof euoh terme in
    eeotion264 of thie title."
         We-wlll~anewer   your questionsin their Inverseorder.

              1. The Act of Congressdoes not purportto odnfereny cor-
porate power upon the State charteredinatltutlone,    nor indeedoould
it do 80, for that would'bebeyond the Conetitutiotil    power of the
United States ae one not delegatedby the States to the United States,
under Article    10, of the Constitutionof the United States.
-    .




HonorableJohn Q. HoAdams,Page 3 (O-5451-A)



          Seotion 265 has for its purpose the regulationof depooidarics
of the public.
             money. The provisocontainedthereinthat the regulations
stipulatedshall not "discriminate  againstor prefernationalbanking
associations, State banks members of the FederalReserveSystem,by
class, or which shall requirethose enjoyingthe benefits,directlyor
indirectlyof disbursedpublic funds so to discriminate,"  could not by
any reasonableconstructionbe held to enlargethe corporatepowers of
State charteredbanking institutions.

         Section 16, ArticleXVI of the State Constitutioncontainsthe
followingparagraph:

         "* * * l No such corporatebody shall be chartereduntil
    all of the authorizedcapitalstock has been subscribedand
    paid for in full in cash. Such body corporateshall not be
    authorizedto engage in businessat more than one place which
    shall be designatedin its charter.* * * * *

          Frrxathis it follows~thatno State chart&M banking institution
may have a branch bank, or exeroisethe bankingprivilegesthroughfacili-
ties for bankingat any place other than the one named in its charter.

          2. Weltherdoes Section 265 of Title 12 purport to authorize
nationalassociationsto establishbranchbanks at any place other than
the place of its authorizeddomicile. It does not deal with such sub-
ject at all.

          Whether or nor a nationalassociationwould be violatingany law
of the United States or of the State in establishinga branch bank in this
State is a questionfor the considerationof the law enforcementauthori-
ties of the State, and requiresno answer in this opinion.

APPROVEDOOT 14, 1943                     Yours very truly

Id GroverSellers                     A!PJ!CRIiRYGRNERALOFTEIAS

F?RSTASSISl%WTATI0PRRYGEIiRRAL       By /s/ Ocie Speer
                                            Ocie Speer
APPROVEROPJNIOR                              Assistant
COMMITThTBY B.W.B. CHAIRMAR

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