Tennessee Code Annotated
Tenn. Code Ann. § 45-2-805 (2026)
Loans to closed banks - Security - Sale of assets
✓ current as of May 2026
- (a) With respect to any bank that is now or may hereafter be closed on account of inability to meet the demands of its depositors, or by action of the commissioner or of a court, or by action of its directors, or in the event of its insolvency or suspension, the commissioner and/or the receiver or liquidator of the institution, with the permission of the commissioner, may borrow from the federal deposit insurance corporation and pledge or mortgage any part or all of the assets of the institution to the corporation as security for a loan by it; provided, that where the corporation is acting as the receiver or liquidator, the order of a court of record of competent jurisdiction shall be obtained first approving the loan. The commissioner, upon the order of a court of record of competent jurisdiction, and upon a like order and with the permission of the commissioner, the receiver or liquidator of the institution may sell to the corporation any part or all of the assets of the institution.
- (b) This section shall not be construed to limit the power of any bank, the commissioner or receivers or liquidators to pledge or sell assets in accordance with any existing law.
Acts 1969, ch. 36, § 1 (3.322); 1973, ch. 294, § 6; T.C.A., § 45-505.
Notes of Decisions
Cited in 3
cases, 1987–1987 · leading case: Fed. Deposit Ins. v. Berry, 659 F. Supp. 1475 (E.D. Tenn. 1987).
Fed. Deposit Ins. v. Berry, 659 F. Supp. 1475 (E.D. Tenn. 1987). “In the instant case the FDIC/Receiver was authorized to sell part or all of the bank’s assets by TCA § 45-2-805. That the FDIC/Receiver and the FDIC/Corporation acting in these capacities are two separate entities is well accepted law.”
Fed. Deposit Ins. Corp. v. Butcher, 660 F. Supp. 1274 (E.D. Tenn. 1987). “this instance, allows for sale of certain assets and liabilities of the failed bank to another bank, with those assets unacceptable to the purchaser being purchased and assumed by the FDIC in its corporate capacity.”
In re the Liquidation of United Am. Bank in Knoxville, 743 S.W.2d 911 (Tenn. 1987). “” Moreover, T.C.A. § 45-2-805 provides, without reference to any prerequisite state of emergency, that the Commissioner or receiver may borrow from the FDIC, pledge or mortgage the bank’s assets to the FDIC to secure a loan, or sell all or part of the assets to the FDIC for this…”
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