La. R.S. 47:1967 — Listing and assessment of bank stock; procedure

A. The shares of stock of all banks, banking companies, firms, associations, or
corporations, doing a banking business in this state, chartered by the laws of this state, any
other state, or of the United States or chartered under the laws of another country are hereby
declared subject to taxation for all purposes in this state.
B. Shares of stock of all banks, banking companies, firms, associations, or
corporations doing a banking business in this state, chartered by the laws of this state, any
other state, or of the United States, or chartered under the laws of another country shall be
valued by the assessing authorities for taxation for all purposes at a percent of their valuation
made by the assessing authorities in accordance with law, as follows: shares of stock in
federal joint stock land banks organized under the Farm Loan Act of 1916 of the United
States Congress shall be assessed for the purpose of taxation at fifteen percent of their
valuation made by the assessing authorities in accordance with law, and shares of all state-chartered banks and of all national banks shall be assessed for the purpose of taxation at
fifteen percent of their valuation commencing with taxable year 1978 made by assessing
authorities in accordance with law, calculated and ascertained by the method hereinafter set
forth.
C. The basis for arriving at the valuation of the shares of stock in any bank, banking
company, firm, association, or corporation engaged in the banking business shall be the
stockholder equity capital which shall be determined by the addition of paid-in common
stock, surplus, undivided profits, and all reserves, excluding those reserves for loan losses
as allowed by the United States Internal Revenue Service. Equity capital shall be adjusted
to remove that portion of equity capital based on United States obligations by deducting a
percentage of equity capital based on the ratio of United States obligations to total assets.
Borrowed money and the value of the preferred stock issued by any such bank and actually
owned by the United States of America or any agency thereof shall not be construed as equity
capital for the purposes of this Section.
D. For the purposes in determining the fair market value of bank stock, the following
criteria shall be used: stockholder equity as defined in Subsection C of this Section shall
serve as a four times factor, eighty percent; annual net earnings of the individual banking
institution shall serve as a one time factor, twenty percent. Annual net earnings shall be
adjusted to remove that portion of earnings based on United States obligations by deducting
a percentage of annual net earnings based on the ratio of interest on United States obligations
to total operating income. Negative earnings shall be included in this formula, but there shall
be no earnings loss carried forward or backward. For the purpose of computing the one time,
twenty percent earnings factor, the earnings shall be capitalized by multiplying the annual
net earnings or net loss of the banking institution by the average price earnings ratio for all
banks in the United States as published by a nationwide recognized bond and securities
rating firm.
E. For the purposes of arriving at fair market value of bank stock in the formula
outlined in Subsection D, the tax commission or its successor shall compute the formula as
follows:
(1) In the case of banks, banking companies, firms, associations, or corporations
created under the laws of the United States, from the statements made to the comptroller of
the currency and required to be published as of December thirty-first of each year.
(2) In the case of banks, banking companies, firms, associations, or corporations
created under the laws of this state, from the statement made to the commissioner of financial
institutions, and required to be published as of December thirty-first of each year.
(3) In the case of banks, banking companies, firms, associations, or corporations
created under the laws of any other state, the FDIC or state regulator and required to be
published as of December thirty-first of each year.
(4) In the case of banks created under the laws of another country, information is to
be submitted to the Louisiana Tax Commission which shall satisfy the purposes of this
Chapter.
F. From the assessment determined by the application of the fifteen percent of fair
market value provided for above, there shall be deducted one hundred percent of the assessed
value of real estate, improvements, buildings, furniture, and fixtures owned by the bank. If
such real estate, improvements, buildings, furniture, and fixtures are owned by a separate
corporation, the deduction will be allowed provided all the capital stock of which (except
directors' qualifying shares, if any) is owned by the bank, banking company, firm,
association, or corporation.
G. Except as provided herein, no assessment shall hereafter be made against the
capital stock, surplus, undivided profits or reserves of any bank, banking company, firm,
association, or corporation engaged in the banking business, chartered under the laws of this
state, any other state, or of the United States, or chartered under the laws of another country
doing business in this state, whose capital stock is represented by shares.
H.(1) It is the will of the Louisiana Legislature to ensure that Louisiana banks do not
become the only corporations in the state subject to a corporate tax. Currently, the corporate
tax paid by banks is the tax on bank stock provided for in this Section, which is paid in lieu
of payment of state corporate income taxes pursuant to R.S. 47:287.11 et seq. Therefore, if
state corporate income tax for corporations other than banks under R.S. 47:287.11 et seq. is
repealed or reduced, the Louisiana Legislature shall provide a commensurate level of tax
relief to banks paying tax under the provisions of this Section, while identifying a revenue
source to meet the obligations of local governments to provide necessary services.
(2) Any action taken by the Louisiana Legislature to comply with the provisions of
this Subsection shall not result in banks being subject to any new tax, fee, or charge that is
not applicable to other corporations in the state.
(3) For purposes of this Subsection, "banks" or a "bank" means an institution insured
by the Federal Deposit Insurance Corporation that is subject to taxation under this Section.
Amended by Acts 1966, No. 145, §1; Acts 1976, No. 704, §1, eff. Jan. 1, 1978; Acts
1984, No. 107, §1; H.C.R. No. 88, 1993 R.S., eff. May 30, 1993; H.C.R. No. 1, 1994 R.S.,
eff. May 11, 1994; Acts 2004, No. 396, §1; Acts 2014, No. 135, §1; Acts 2014, No. 623, §1;