New Jersey § 17:9a-50

§ 17:9a-50.

A. Every bank shall at the close of each period for which a dividend is declared,

and in any event at least semi-annually, determine its net profits for such dividend

or semi-annual period by deducting from its gross income for such period (1) all expenses paid or accrued; (2) all interest paid or accrued; (3) all taxes paid or accrued; (4) amortization of premiums on securities which are carried on the books of the bank

at more than the principal amounts payable thereon at maturity or at the then next

earliest call date for redemption, under such regulations as the commissioner shall

from time to time prescribe with the approval of the banking advisory board. In lieu of applying such deductions to amortization of premiums, the bank may credit

such deductions to reserves against such premiums; (5) all losses sustained, including reductions in and eliminations of the values of

assets, authorized by the board of directors or directed by the commissioner; and (6) all debts owing to the bank, other than investment securities, as defined in paragraph

(2) of section 60, 1 on which principal or interest shall be in default for more than six months, except

to the extent that such debts and accrued interest thereon are secured or collectible. B. The deductions from gross income required by subsection A of this section need

not be made to the extent that they were previously deducted from gross income, or

if reserves are adequate, or, if not, are made adequate by new or additional credits

thereto; provided, that, in the amount only that such credits are made to eliminate

deductions otherwise required by subsection A of this section, such credits shall

be deducted from gross income. C. “Gross income” as used in this section shall include (1) all income received or accrued, provided that no interest shall be accrued upon

an interest-bearing obligation in default unless the obligation is secured and the

value of the security is at least equal to the amount at which the obligation plus

all interest accrued thereon is carried on the books of the bank; (2) amounts realized on the payment, collection, sale or other disposition of assets

over and above their values on the books of the bank; (3) increases in the book values of assets, authorized by the board of directors and

approved by the commissioner, wholly or partly restoring values previously reduced

or eliminated by the board of directors or by direction of the commissioner; (4) amounts transferred from reserves, to the extent that such amounts were deducted

from gross income pursuant to subsection A of this section; and (5) such other items as the commissioner may from time to time permit to be included. 1

N.J.S.A. § 17:9A-60.