501.1 Interstate Mergers, Aquisitions, and Branching [Back]

A. Upon application to and approval granted by the State Banking Commissioner or Comptroller of the Currency, an out-of-state bank which engages or has engaged in any interstate merger transaction with a bank or savings association that, prior to the merger, had its main office located in this state shall be permitted to establish de novo branches in this state. An out-of-state bank which is not engaging, and has not previously engaged, in an interstate merger transaction with a bank or savings association that, prior to the merger, had its main office located in this state, shall not be permitted to establish a de novo branch in this state, nor to acquire a branch bank or savings association branch in this state, unless, on a reciprocal basis, the state where the main office of the out-of-state bank is located would permit a bank with a main office located in this state to establish a de novo branch in that other state without having engaged in an interstate merger transaction with a bank having its main office in that other state.

B. Subject to the limitations set forth in subsection A of this section, a bank, branch bank, savings association, or savings association branch may be acquired by and engage in an interstate merger transaction or interstate branch acquisition transaction with any out-of-state bank in accordance with applicable laws and rules of the Oklahoma State Banking Department and the state in which the main office of the out-of-state bank is located. If the out-of-state bank does not have a branch bank or savings association branch in this state at the time the interstate merger or interstate branch acquisition transaction application is filed with the appropriate regulatory authority, and if the law of the state where the main office of the out-of-state bank is located does not permit reciprocal interstate de novo branching by a bank with a main office located in this state as more particularly provided for in subsection A of this section, then the out-of-state bank must acquire the bank or the savings association, and may not acquire just a branch or branches thereof. An interstate merger or interstate branch acquisition transaction will not be permitted if it will result in a violation of the twenty percent (20%) deposit limitation contained in subsection I of Section 19 of this act. If the result of an interstate merger transaction is that the bank or savings association which is acquired is converted to one or more branch banks of an out-of-state bank, the resulting branch bank shall have all the powers and be subject to the same limitations as any other branch bank located in this state. All in-state branch banks of an out-of-state bank shall be regulated by the State Banking Commissioner as if the branch banks comprised an Oklahoma bank and the branch banks shall comply with applicable Oklahoma laws and rules in the conduct of their business in this state to the maximum extent authorized under federal law. No in-state branch bank of an out-of-state bank shall be permitted to engage in any activity not permissible for a bank in this state.

C. Beginning May 31, 1997, a bank may establish a branch bank in any other state, or may acquire branch banks of an out-of-state bank which are located in any other state in accordance with the laws of the other state. The bank shall be required to follow all procedures and to obtain all approvals necessary to establish or acquire a branch bank under applicable Oklahoma law and any applicable rules as may be established by the Banking Board. The bank shall file with the Department a copy of each application or notice filed with federal or other state regulatory authorities relating to the transaction at the same time the application or notice is filed with the federal or other state regulatory authorities. Upon consummation of the transaction, the bank shall have all of the powers under the applicable laws and regulations of the state in which each branch bank is located, subject to the duties and restrictions thereof. In addition to any regulation by bank and regulatory authorities in the state where a branch bank is located, each branch bank located outside of this state shall be subject to regulation by the Department as if the branch bank were located in this state and shall comply with the law of this state in the conduct of its banking business in such other state.

D. The provisions of this section shall not be construed as permitting branches established pursuant to this section through an interstate merger transaction to be taxed at a rate which is different from or discriminates in any way against a bank, savings association, or branch of either, which is chartered in this state. The Oklahoma Tax Commission is hereby authorized to adopt policies and procedures consistent with the provisions of this subsection.

E. An operating subsidiary of a bank which engages in the business of owner-occupied home mortgage lending shall not be considered a branch under this section in order to conduct such lending operations at any location.

501.2. Branch Banking [Back]

A. No bank shall be permitted to establish and operate a branch, or relocate a branch, except upon a certificate issued by the State Banking Commissioner or the Comptroller of the Currency.

B. Upon approval of the Commissioner or Comptroller of the Currency, any bank is authorized to establish and operate in Oklahoma, on real property owned or leased by the bank, an unlimited number of branches by acquisition, de novo, or otherwise, whether fixed or mobile, at or from which any permissible function, business, power, or activity of any kind whatsoever of the bank may be performed or engaged in. Provided, however, no bank, savings bank, savings association, out-of-state bank, out-of-state savings bank, out-of-state savings association, industrial loan company or industrial bank may establish or maintain a branch in this state on the premises or property of an affiliate if the affiliate engages in commercial activities. For purposes of this section, "affiliate" means any company that controls, or is controlled by another company, and "commercial activities" means activities in which a bank may not engage under federal law, either directly or indirectly through an operating subsidiary or financial subsidiary.

C. Except for the procedures relating to establishment of temporary branches, the procedures, standards and requirements for making application for permission to establish and operate a branch shall be set by rule of the Banking Board. However, no emphasis upon competition or competitive factors shall be imposed, and in no event shall such rules impose standards, criteria, or requirements upon state-chartered banks which are more onerous than those existing for national banks.

D. All existing branches and detached facilities of a bank shall, upon the expiration of sixty (60) days after the effective date of this act, by operation of law and without further action by the bank or Commissioner, or the Comptroller of the Currency, become and be deemed lawful branches, fully authorized and validly existing pursuant to this section. Provided, a bank may elect to opt-out of the effects of this subsection as to one or more of its existing detached facilities, by providing to its chartering authority, prior to the expiration of sixty (60) days after the effective date of this act, a written notice that the bank has opted-out of the effects of this subsection with the result that one or more of its detached facilities will continue to be classified as detached facilities rather than as branches. The written notice must clearly identify each particular detached facility to which it applies. "Existing branches and detached facilities", for purposes of this subsection, means branches or detached facilities which have been approved and are open and operating, or are approved but unopened, or for which application was made prior to the effective date of this act and for which approval is given after the effective date of this act.

E. Any bank or savings association with its main office or a branch office located in a county where an institution of higher education is located, may open accounts and accept deposits on the campus of the institution of higher education if notice is provided to the Department and written permission is granted by the institution, for no more than seven (7) days per year. The authorization of this subsection shall be self-executing and no application to the regulators of the bank or savings association shall be required by this section for a bank or savings association to comply with this subsection.

F. A temporary branch may be established and operated upon approval of the Commissioner or Comptroller of the Currency. As used in this subsection, "temporary branch" means:

1. A branch that is located at a fixed site that is within one thousand (1,000) feet of the location of the approved site of the same bank for a permanent branch, and such temporary branch is scheduled to, and will, permanently close not later than a certain date, no longer than one (1) year after the temporary branch is first opened, as specified in the permanent branch application and the public notice. No seperate fee shall be imposed for a temporary branch approved under this paragraph if the temporary site is originally described in an application seeking to establish a permanent branch;

2. A branch that is approved for a limited period of time, without requirement of notice or hearing, as a temporary replacement for a previously existing branch that is inoperable due to an "emergency" as defined in Section 102 of this title or that is established because of an emergency in a community that prevents access to an established branch by customers in a specified community. Approval of a temporary branch established under this paragraph shall expire at the time the emergency that caused the establishment of the temporary branch no longer exists. No seperate fee shall be imposed for a temporary branch approved under this paragraph; or

3. Branches that are approved for a limited time not to exceed, in the aggregate, fifteen (15) days per year, per institution, that will be operated during special events open to the public or to members of a specific group. The application fee for a temporary branch under this paragraph shall be the same as that charged for a loan and deposit production office. Requests to establish a branch under this paragraph must be made on a form prescribed by the Commissioner.

G. The Board may, by rule, establish a procedure whereby the Commissioner may grant approval and issue the certificate to establish or acquire and operate or relocate a branch or other banking office permitted by this section without a hearing before the Board. The procedure shall include criteria set by the Board to be applied by the Commissioner in the consideration of the application.

H. Notwithstanding subsection C of this section, an application fee for branch, branch relocation or other banking office applications may be assessed in amounts set by rule of the Board.

I.

1. It shall be unlawful for any bank or out-of-state bank which has direct or indirect control of more than twenty percent (20%) of the total amount of deposits of insured depository institutions located in Oklahoma, as determined by the Commissioner on the basis of the most recent reports of such institutions to their supervisory authorities, to acquire any other bank or savings association in this state.

2. The deposit limitation provided for in this subsection shall not apply to disallow an acquisition of a bank or savings association if control results only by reason of ownership or control of shares of a bank or savings association acquired directly or indirectly:

a. in a good faith fiduciary capacity, except when such shares are held for the benefit of the acquiring bank’s shareholders,

b. by a bank in the regular course of securing or collecting a debt previously contracted in good faith, or

c. at the request of or in connection with the exercise of regulatory authority for the purpose of preventing imminent failure of the bank or savings association or to protect the depositors thereof as determined by the principal supervisory agency in its sole discretion.

However, at the end of a period of five (5) years from the date of acquisition, for the circumstances set forth in subparagraphs b and c of this paragraph, the deposits of the acquired bank or savings association shall be included in computing the deposit limitation and if deposits are in excess, appropriate reductions and disposition shall be made with six (6) months to meet such limitations. Further, in the circumstances set forth in subparagraph c of this paragraph, the Commissioner and Federal Deposit Insurance Corporation shall give priority in authorizing any such acquisition to any acquiring bank whose total deposits do not exceed the deposit limitation.

J. The provisions of this section shall not be construed in derogation or denial of the rights to operate and maintain facilities as provided for in Sections 421 and 422 of this title.

K. An operating subsidiary of a bank which engages in the business of owner-occupied home mortgage lending shall not be considered a branch under this section in order to conduct such lending operations at any location.

502. Bank holding companies [Back]

A. This section may be cited as the "Bank Holding Company Section" and shall have for its purpose the maintenance of competitive services between banks by limiting the expansion of bank holding companies and similar organizations. It is deemed to be in the public interest that competition prevail in the banking system in the State of Oklahoma and to that end that the independence of unit banks be preserved. Further, it shall be the policy of this state to oppose any attempt by any bank holding company to acquire control of any bank located in this state if such acquisition would result in a monopoly or in an attempt to monopolize the business of banking in this state.

B. A company may be a multibank holding company and have direct or indirect ownership or control of two or more banks or bank holding companies, subject to the deposit limitation provided for in subsection C of this section. However, except as specifically permitted in this Code, all forms of direct or indirect ownership or control of banks, bank holding companies, and multibank holding companies by any out-of-state bank or out-of-state bank holding company shall be prohibited.

C. It shall be unlawful for a multibank holding company or an out-of-state bank or bank holding company to acquire direct or indirect ownership or control of any insured depository institution located in this state if the acquisition results in any such holding company or bank having direct or indirect ownership or control of insured depository institutions located in this state, the total deposits of which at the time of the acquisition exceed twenty percent (20%) of the total amount of deposits of insured depository institutions located in this state as determined by the State Banking Commissioner on the basis of the most recent reports of such institutions to their supervisory authorities which are available at the time of the proposed acquisition or to acquire direct or indirect control of any insured depository institution in this state after such multibank holding company or an out-of-state bank or bank holding company has reached or exceeded the twenty percent (20%) threshold as provided in this subsection. Acquisitions of other multibank holding companies shall not be exempt from this limitation. Board of Directors requirements

D. The deposit limitation provided for in subsection C of this section shall not apply in the following circumstances:

1. Control of a bank by reason of ownership or control of shares acquired by a bank or by a bank holding company in good faith in a fiduciary capacity, except where such shares are held for the benefit of the shareholders of such bank or such bank holding company; or

2. Control of a bank by reason of ownership or control of shares acquired by a bank or by a bank holding company in the regular course of securing or collecting a debt previously contracted in good faith.

E. A bank holding company or a multibank holding company may apply for and obtain an interim charter to organize an interim state bank for the purpose of facilitating the creation of a bank holding company, or acquiring or merging with an existing bank in accordance with the provisions of Section 502.1 of this title or the laws of the United States.

F. A national bank in this state, bank holding company, or multibank holding company seeking to acquire a state bank or national bank in this state, or a nonbanking company that submits an application for approval of such acquisition to the Board of Governors of the Federal Reserve System pursuant to the Provisions of Sections 1841 et seq. of Title 12 of the United States Code Annotated shall also submit a copy of such application to the Board.

G. The district court shall have jurisdiction to determine all questions of compliance with the provisions of this section, except such jurisdiction shall not apply to actions of the Board or proceedings before the Board conducted pursuant to the Banking Code. The decision of the district court shall be appealable to the Supreme Court in the same manner as in other civil cases.

H.

1. Each bank holding company, multibank holding company and out-of-state bank holding company which directly or indirectly owns, controls, or has power to vote twenty-five percent (25%) or more of the voting shares of one or more banks shall furnish a copy of the annual report of the operations of the holding company which is submitted to the Federal Reserve Bank for each fiscal year to the Commissioner.

2. The books and records of each bank holding company of state-chartered banks are subject to inspection and examination by the Commissioner.

502.1 Interim state banks-Application-Prefiling meeting-Acceptance of application-Merger or consolidation [Back]

A. Rules of General Applicability

1. The interim state bank, prior to commencing business, shall be a party to a merger or consolidation with an existing bank. The application to organize an interim state bank and the subsequent merger or consolidation application shall be melded into a single process requiring, after the filing of the subsequent merger or consolidation application, one opportunity for public comment after notice is published by the applicant and one substantive review by the Department pursuant to Section 1103 of this title.

2. The provisions of Section 303 of this title governing the number of organizers shall not apply to applications to organize an interim state bank.

B. Prefiling meeting concerning application to organize an interim state bank The proposed organizers of an interim state bank should schedule a meeting with the Commissioner to discuss the proposal and the Department rules, policies and procedures, including means to combine many procedural and processing requirements, applicable to the organization of an interim state bank. The Department shall provide the organizers with forms and documents which should be filed with the application for authority to organize an interim state bank. The prefiling meeting provided for in this subsection may be waived by the Commissioner.

C. Acceptance of application to organize

1. The Commissioner shall accept an application for authority to organize an interim state bank for processing if the applicant has completed all of the information requested in the application. Applicants shall have one opportunity to correct deficiencies. Deficiencies that are not corrected adequately when the application is resubmitted may cause the application to be considered withdrawn or disapproved.

2. Approval of the application by the Board shall be specifically conditioned on approval of the subsequent merger or consolidation. The approval shall be rescinded automatically if the merger or consolidation is disapproved or if subsequent approval for establishment of a holding company or for acquisition of the interim bank by the holding company is not received within twelve (12) months from the filing of the application for authority to organize an interim state bank, unless an extension has been requested by the applicant and granted by the Board. If the merger or consolidation application is not filed within six (6) months of approval of the interim state bank, the preliminary approval shall be withdrawn unless an extension has been requested by the applicant and granted by the Board.

D. Subsequent merger or consolidation

1. When the interim state bank's duly executed certificate of incorporation is filed with and accepted by the Board, the interim state bank becomes a body corporate, and may then legally enter into the merger or consolidation agreement.

2. All steps necessary to perfect the organization of a state bank must be completed before consummation of the merger or consolidation.

E. Rules The Board shall adopt and promulgate rules necessary to effectuate the provisions of this section.

503. Trust companies-Branch offices [Back]

Nothing contained in this Code shall authorize trust companies, covered by or eligible for insurance coverage by the Federal Deposit Insurance Corporation, to establish branch offices within this state. As used in this section, "branch office" includes, but is not limited to, any additional agency, office or other facility located within this state at which business is conducted. Provided, however, this section shall not be effective as to any such "branch office" in existence at the time and date of the enactment hereof, nor shall it be so construed as to prohibit the establishment of agents or agencies for the sole purpose of conducting the business of title insurance or abstracting.

506. Out-of-state bank holding companies-Acquisition of control [Back]

A. An out-of-state bank holding company, upon approval by the Federal Reserve Board, may acquire an unlimited number of banks, bank holding companies and multibank holding companies. Any acquisition made pursuant to the provisions of this section may include assets and liabilities of the bank, bank holding company or multibank holding company and all branches and facilities thereof.

B. No out-of-state bank holding company shall be permitted to acquire direct or indirect ownership or control of any bank, bank holding company, or multi bank holding company, except in compliance with this section.

C. No acquisition provided for in this section shall be permitted unless the approval of the Federal Reserve Board required pursuant to subsection A of this section:

1. Includes, for all acquisitions, a finding that:

a. notice of intent to acquire has been published in a newspaper of general paid circulation in the county or counties where the bank or banks to be acquired are located and that a notice of intent to acquire has been mailed by certified mail with return receipt requested to each person owning stock in the bank, bank holding company or multibank holding company to be acquired,

b. the reports required by the Federal Reserve Board in order to assess the out-of-state bank holding company's record of meeting the credit needs of its entire community as required under the provisions of Section 2903 of Title 12 of the United States Code have been placed on file as a matter of public record with the Oklahoma State Banking Department, and

c. the bank and, if acquired indirectly, its bank holding company or multibank holding company immediately after the acquisition meets the capital adequacy guidelines of the appropriate federal financial supervisory agency; and

2. Includes, for any acquisition of a majority of the voting shares, a finding that the acquisition has been approved by the board of directors and a majority of the voting shares of the bank or of its parent bank holding company or multibank holding company.

D. All limitations and restrictions of the Oklahoma Banking Code applicable to banks, bank holding companies and multibank holding companies shall apply to a bank, bank holding company or multibank holding company which becomes a subsidiary of an out-of-state bank holding company and to such out-of-state bank holding company. In addition, any bank which becomes a subsidiary of an out-of-state bank holding company shall maintain current reports showing the bank's record of meeting the credit needs of its entire community as required by the bank's federal financial supervisory agency under Section 2903 of Title 12 of the United States Code on file as a matter of public record with the Department.

E. Any out-of-state bank holding company which controls a bank, a bank holding company or multibank holding company shall be subject to laws of this state and rules of its agencies relating to the acquisition, ownership, and operation of banks, bank holding companies and multibank holding companies.

F. The Board shall have the power to enforce the prohibitions provided for in this section by requiring divestiture and through the imposition of fines and penalties, the issuance of cease and desist orders, and such other remedies as are provided by law.

G. Any final order of the Board shall be appealable pursuant to the provisions of Section 207 of this title.

510. Oklahoma Industrial Loan Company Branch Act [Back]

This act shall be known and may be cited as the “Oklahoma Industrial Loan Company Branch Act of 2006”.

511. Definition of industrial loan company and industrial bank [Back]

As used in this act, an “industrial loan company” or “industrial bank” means a company that is chartered by another state to make consumer loans or commercial loans or to accept deposits insured by the Federal Deposit Insurance Corporation but not to accept demand deposits and that is not subject to the Bank Holding Company Act of 1987 or to supervision by the Federal Reserve System.

512. Interstate branching by industrial loan company and industrial bank [Back]

A.  An out-of-state industrial loan company or industrial bank shall not be permitted to establish a de novo branch in this state, nor to acquire a branch bank or savings association branch in this state, unless, on a reciprocal basis, the state where the main office of the out-of-state industrial loan company or industrial bank is located would permit a bank chartered under the laws of this state with a main office located in this state to establish a de novo industrial loan company or industrial bank branch in that other state without having engaged in an interstate merger transaction with an industrial loan company or industrial bank having its main office in that other state.

B.  No industrial loan company or industrial bank shall be permitted to establish and operate a branch, or relocate a branch, except upon a certificate issued by the State Banking Commissioner.

C.  The State Banking Board shall adopt and promulgate rules necessary to effectuate the provisions of this act.  The Board may, by rule, establish a procedure whereby the Commissioner may grant approval and issue the certificate to establish or acquire and operate or relocate a branch or other banking office permitted by this section without a hearing before the Board.  The procedure shall include criteria set by the Board to be applied by the Commissioner in the consideration of the application.

513. Severability [Back]

The provisions of this act are severable and if any part or provision shall be held void, the decision of the court so holding shall not affect or impair any of the remaining parts or provisions of this act.