The bill amends Arkansas Code 23-47-503, which governs loans involving the stock of state banks. It establishes that, with certain exceptions, it is unlawful for a state bank to loan its funds to stockholders using its own stock or that of its bank holding company as collateral. The bill clarifies that a bank may acquire its own stock in the regular course of collecting a debt if it complies with specific conditions, including divesting the stock within two years. Additionally, the bill introduces provisions allowing state banks to acquire loans secured by their own stock during mergers or similar transactions, as well as maintaining such loans under certain conditions.

Furthermore, the bill specifies that officers or directors of a state bank who violate these provisions may face civil penalties of up to $100,000. It also defines "target institution" to include various types of banks and financial institutions. The amendments aim to provide clearer guidelines for state banks regarding the handling of loans involving their own stock while ensuring compliance with regulatory standards.