GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1989

H	1 

HOUSE BILL 2051*

Short Title:  Sale of New Bank/S&L.	(Public)
─────────────────────────────────────── 
Sponsors: Representatives Brubaker, Holmes, Dickson, Hasty, and Rogers.
─────────────────────────────────────── 
Referred to:  Commerce.
─────────────────────────────────────── 

May 23, 1990

A BILL TO BE ENTITLED
AN ACT TO REDUCE FROM FIVE YEARS TO THREE YEARS THE MORATORIUM ON ACQUISITION OF A NORTH CAROLINA BANK OR SAVINGS ASSOCIATION BY AN OUT-OF-STATE INSTITUTION.
The General Assembly of North Carolina enacts:
Section 1.  G.S. 53-211(a) reads as rewritten:
"(a)	A regional bank holding company that does not have a North Carolina bank subsidiary (other than a North Carolina bank subsidiary that was acquired either pursuant to Section 116 or Section 123 of the Garn-St. Germain Depository Institutions Act of 1982 (12 U.S.C. 1730a(m), 1823(f)) or in the regular course of securing or collecting a debt previously contracted in good faith, as provided in Section 3(a) of the Bank Holding Company Act of 1956 as amended (12 U.S.C. 1842(a)) may acquire a North Carolina bank holding company or a North Carolina bank with the approval of the Commissioner.  The regional bank holding company shall submit to the Commissioner an application for approval of such acquisition, which application shall be approved only if:
(1)	The Commissioner determines that the laws of the state in which the regional bank holding company making the acquisition has its principal place of business permit North Carolina bank holding companies to acquire banks and bank holding companies in that state;
(2)	The Commissioner determines that the laws of the state in which the regional bank holding company making the acquisition has its principal place of business permit such regional bank holding company to be acquired by the North Carolina bank holding company or North Carolina bank sought to be acquired.  For the purposes of this subsection, a North Carolina bank shall be treated as if it were a North Carolina bank holding company;
(3)	The Commissioner determines either that the North Carolina bank sought to be acquired has been in existence and continuously operating for more than three years or that all of the bank subsidiaries of the North Carolina bank holding company sought to be acquired have been in existence and continuously operating for more than three years: Provided, that the Commissioner may approve the acquisition by a regional bank holding company of all or substantially all of the shares of a bank organized solely for the purpose of facilitating the acquisition of a bank that has been in existence and continuously operating as a bank for more than three years: Provided further, where the Commissioner after examination or other investigation has determined that it is necessary to approve an interstate acquisition under this Article in order to protect the public and to prevent the possible failure of a bank or banking subsidiary of a bank holding company, then the time limitations of this subdivision do not apply; and
(4)	The Commissioner makes the acquisition subject to any conditions, restrictions, requirements or other limitations that would apply to the acquisition by a North Carolina bank holding company of a bank or bank holding company in the state where the regional bank holding company making the acquisition has its principal place of business but that would not apply to the acquisition of a bank or bank holding company in such state by a bank holding company all the bank subsidiaries of which are located in that state."
Sec. 2.  G.S. 54B-48.3 reads as rewritten:
"§ 54B-48.3. Acquisitions by Southern Region savings and loan holding companies and Southern Region associations.
(a)	A Southern Region savings and loan holding company or a Southern Region association that does not have a North Carolina association subsidiary (other than a North Carolina association subsidiary that was acquired either pursuant to Section 123 of the Garn-St. Germain Depository Institutions Act of 1982 (12 U.S.C. 1730a(m)), or comparable provisions in state law, or in the regular course of securing or collecting a debt previously contracted in good faith) may acquire a North Carolina savings and loan holding company or a North Carolina association with the approval of the Administrator.  The Southern Region savings and loan holding company or Southern Region association shall submit to the Administrator an application for approval of such acquisition, which application shall be approved only if:
(1) 	The Administrator determines that the laws of the state in which the Southern Region savings and loan holding company or Southern Region association making the acquisition has its principal place of business permit North Carolina savings and loan holding companies and North Carolina associations to acquire associations and savings and loan holding companies in that state;
(2) 	The Administrator determines that the laws of the state in which the Southern Region savings and loan holding company or Southern Region association making the acquisition has its principal place of business permit such Southern Region savings and loan holding company or Southern Region association to be acquired by the North Carolina savings and loan holding company or North Carolina association sought to be acquired;
(3) 	The Administrator determines either that the North Carolina association sought to be acquired has been in existence and continuously operating for more than three years or that all of the association subsidiaries of the North Carolina savings and loan holding company sought to be acquired have been in existence and continuously operating for more than three years: Provided, that the Administrator may approve the acquisition by a Southern Region savings and loan holding company or Southern Region association of all or substantially all of the shares of an association organized solely for the purpose of facilitating the acquisition of an association that has been in existence and continuously operating as an association for more than three years; and
(4) 	The Administrator makes the acquisition subject to any conditions, restrictions, requirements or other limitations that would apply to the acquisition by a North Carolina savings and loan holding company or North Carolina association of an association or savings and loan holding company in the state where the Southern Region savings and loan holding company or Southern Region association making the acquisition has its principal place of business but that would not apply to the acquisition of an association or savings and loan holding company in such state by an association or a savings and loan holding company all the association subsidiaries of which are located in that state;
(5) 	With respect to acquisitions involving the merger or consolidation of two associations resulting in a Southern Region association, the application includes a business plan extending for an initial period of at least three years from the date of the acquisition which shall be renewed thereafter for as long as may be required by the Administrator. The association may not deviate without the prior written approval of the Administrator from the business plan which shall address such matters as the Administrator may deem appropriate for the protection of the depositors and members of the acquired North Carolina association and the general public. The business plan shall address, without limitation:
a. 	Insurance of depositors' accounts.
b. 	Limitation of services and activities to those permitted under this Chapter to North Carolina associations.
c. 	Conversion of corporate form or other fundamental changes.
d. 	Closing, selling or divesting any or all North Carolina branches.
e. 	Protection of the voting rights of North Carolina members.
(b)	A Southern Region savings and loan holding company or Southern Region association that has a North Carolina association subsidiary (other than a North Carolina association subsidiary that was acquired either pursuant to Section 123 of the Garn-St. Germain Depository Institutions Act of 1982 (12 U.S.C. 1730a(m)), or comparable provisions in North Carolina law, or in the regular course of securing or collecting a debt previously contracted in good faith) may acquire any North Carolina association or North Carolina savings and loan holding company with the approval of the Administrator. The Southern Region savings and loan holding company shall submit to the Administrator an application for approval of such acquisition, which application shall be approved only if:
(1) 	The Administrator determines either that the North Carolina association sought to be acquired has been in existence and continuously operating for more than three years or that all of the association subsidiaries of the North Carolina savings and loan holding company sought to be acquired have been in existence and continuously operating for more than three years: Provided, that the Administrator may approve the acquisition by a Southern Region savings and loan holding company or Southern Region association of all or substantially all of the shares of an association organized solely for the purpose of facilitating the acquisition of an association that has been in existence and continuously operating as an association for more than three years; and
(2) 	The Administrator makes the acquisition subject to any conditions, restrictions, requirements or other limitations that would apply to the acquisition by the North Carolina savings and loan holding company or North Carolina association of an association or savings and loan holding company in the State where the Southern Region savings and loan holding company or Southern Region association making the acquisition has its principal place of business but that would not apply to the acquisition of an association or savings and loan holding company in such state by a savings and loan holding company all the association subsidiaries of which are located in that state.
(3) 	With respect to acquisitions involving the merger or consolidation of two associations resulting in a Southern Region association, the application includes a business plan extending for an initial period of at least three years from the date of the acquisition which shall be renewed thereafter for as long as may be required by the Administrator. The association may not deviate without the prior written approval of the Administrator from the business plan which shall address such matters as the Administrator may deem appropriate for the protection of the depositors and members of the acquired North Carolina association and the general public. The business plan shall address, without limitation:
a. 	Insurance of depositors' accounts.
b. 	Limitation of services and activities to those permitted under this Chapter to North Carolina associations.
c. 	Conversion of corporate form or other fundamental changes.
d. 	Closing, selling or divesting any or all North Carolina branches.
e. 	Protection of the voting rights of North Carolina members.
(c)	The Administrator shall rule on any application submitted under this section not later than 90 days following the date of submission of a complete application.  If the Administrator fails to rule on the application within the requisite 90-day period, the failure to rule shall be deemed a final decision of the Administrator approving the application."
Sec. 3.  This act is effective upon ratification.