By the Act of December 17, depositors of defaulting Oklahoma banks were to be paid at once; and to provide a fund in advance to meet such contingent payments, assessments were levied against all state banks and trust companies equal to 1 per cent of their average daily deposits. This fund, when depleted by payments, was to be repleted by special assessments to which no limit was set. By the amendment of 1909 the fund was fixed at 5 per cent of the average daily deposits and was to be gradually accumulated by contributions of 1/2. per cent per year. In 1913 the extra assessments in any one year were limited to 2 per cent.
The present status of the law is that the annual assessment shall be 1/5 per cent of the average daily deposits and no more. Extra assessments were abolished in 1916. In case the fund proves insufficient at any time to meet the losses, the unsatisfied depositors are given certificates of indebtedness bearing 6 per cent interest, or the certificates are sold on the market and the proceeds used to pay depositors. These certificates are called and paid as soon as the legal annual assessments recoup the guaranty fund. They are a first lien against the assets of each bank operating under the law to the extent of the bank's liability to the guaranty fund, and are exempted from state and local taxes. They are considered a good investment and have found a ready market. Since 1909, 75 per cent of the fund may be invested in state warrants and similar securities, the remainder being held by the State Banking Board. Banks may pay their assessments by non-interest-bearing cashier's checks, and these checks may be held by the board until the funds are needed, thus giving the contributing bank use of the funds until really wanted by the board.
To secure its liability to the fund, the bank is required to deposit collateral securities equal to 1 per cent of its deposits. The State Banking Board, which handles this fund as well as the general supervision of the banks, was at first composed wholly of political appointees; but in 1913 the banks succeeded in getting control of appointments to the board to the extent that three of its five members are now chosen from a list recommended by the State Bankers' Association. When a bank defaults, the State Bank Commissioner takes charge and determines whether it is solvent or not; if he finds it insolvent he liquidates it. Depositors are paid from the available cash and from the guaranty fund; the proceeds from the liquidation are paid into the fund, but if insufficient to replete it, certificates of indebtedness are issued to the unsatisfied depositors or are sold to the public at large for funds to pay depositors. Deposits that are otherwise secured are not guaranteed, nor are deposits guaranteed on which a greater rate of interest is paid than that fixed by the Bank Commissioner (4 per cent in 1918), nor are deposits of trust companies protected any longer.