Commercial National Bank v. Rich

Commercial National Bank of Sturgis and First State Bank of Piedmont will be referred to in this opinion as Sturgis bank and Piedmont bank respectively. Defendant Rich was not served and made no appearance in the action.

M. M. Brown was president and chief executive officer of Sturgis 'bank, and he and defendants in this action were officers *293and directors of Piedmont bank. The statute forbids a bank to loan to one person or firm more than 20 per cent of its combined capital and surplus. In 1919 Sturgis bank had more money on hand than it could get loaned out, and Piedmont bank had customers…