Chapter 1181: DIVISION OF FINANCIAL INSTITUTIONS

1181.01 Superintendent is chief executive officer; qualifications; appointment of deputy superintendents.

The superintendent of financial institutions shall be the chief executive officer of the division of financial institutions.

(A) The superintendent shall have at least five years of experience in the financial services industry or in the examination or regulation of financial institutions.

(B) The superintendent shall appoint a deputy superintendent for banks, who shall possess at least one of the following qualifications prior to the deputy superintendent's appointment:

(1) Not less than five years of experience as a senior level officer in a bank, savings and loan association, or savings bank, a bank holding company, or a savings and loan holding company or as a senior level manager or senior professional with a primary business of, or professional focus on, auditing or providing professional advice to such institutions;

(2) Not less than five years of experience as a senior level supervisor in the examination or regulation of banks, savings and loan associations, or savings banks;

(3) Not less than a total of five years of experience in any combination of the positions described in divisions (B)(1) and (2) of this section.

(C) The superintendent shall appoint a deputy superintendent for credit unions, who shall possess at least one of the following qualifications prior to the deputy superintendent's appointment:

(1) Not less than five years of experience as a senior level officer in a credit union or as a senior level manager or senior professional with a primary business of, or professional focus on, auditing or providing professional advice to credit unions;

(2) Not less than five years of experience as a senior level supervisor in the examination or regulation of credit unions;

(3) Not less than a total of five years of experience in any combination of the positions described in divisions (C)(1) and (2) of this section.

(D) The superintendent shall appoint a deputy superintendent for consumer finance, who shall possess at least one of the following qualifications prior to the deputy superintendent's appointment:

(1) Not less than five years of experience as an owner, officer, or senior level manager of one or more consumer finance companies , as a senior level manager of a mortgage banking affiliate of a bank, savings and loan association, savings bank, bank holding company, or savings and loan holding company, or as a senior level manager or senior professional with a primary business of, or professional focus on, auditing or providing professional advice to consumer finance companies;

(2) Not less than five years of experience as a senior level supervisor in the examination or regulation of consumer finance companies;

(3) Not less than a total of five years of experience in any combination of the positions described in divisions (D)(1) and (2) of this section.

(E) The deputy superintendents appointed by the superintendent of financial institutions pursuant to this section shall serve in the unclassified civil service.


Amended by 132nd General Assembly File No. TBD, HB 49, §130.21, eff. 1/1/2018.

Effective Date: 09-26-1996 .

1181.02 Employees.

The superintendent of financial institutions may appoint and employ such assistants, clerks, examiners, and other employees, and such professionals and agents, as the prompt execution of the duties of the superintendent's office requires, and may employ attorney examiners if the superintendent considers such assistants necessary.


Amended by 132nd General Assembly File No. TBD, HB 49, §130.21, eff. 1/1/2018.

Effective Date: 09-26-1996 .

1181.03 Fidelity bonds.

(A) Before entering upon the discharge of the duties of the office of the superintendent of financial institutions, the superintendent shall give bond to the state in the sum of one million dollars with sureties approved by the governor and conditioned on the faithful discharge of the official duties of the office. The bond, with the approval of the governor and with the superintendent's oath of office endorsed on it, shall be filed with the office of the secretary of state.

(B) Before entering upon the discharge of the duties of their respective offices, the deputy superintendent for banks, the deputy superintendent for credit unions, and the deputy superintendent for consumer finance shall each give bond to the state in the sum of five hundred thousand dollars with sureties approved by the superintendent and conditioned on the faithful performance of their respective duties. The bonds shall be filed with the office of the secretary of state.

(C) The superintendent shall require of each other employee and each agent of the division of financial institutions a bond, conditioned on the faithful performance of each employee's and agent's respective duties, in an amount not less than five thousand dollars that the superintendent determines to be acceptable. The bonds may, in the discretion of the superintendent, be individual, schedule, or blanket bonds. The bonds shall be filed with the office of the secretary of state.

(D) The division shall pay the cost or premium of the bonds required by this section from funds appropriated to the division for that purpose.


Amended by 132nd General Assembly File No. TBD, HB 49, §130.21, eff. 1/1/2018.

Effective Date: 09-26-1996 .

1181.04 Immunity.

Neither the superintendent of financial institutions nor any employee, agent, or contractor of the division of financial institutions shall be liable in any civil, criminal, or administrative proceeding for any mistake of judgment or discretion in any action taken, or any omission made by the superintendent , employee, agent, or contractor if done in good faith within the scope of the person's official capacity as assigned by the superintendent.


Amended by 132nd General Assembly File No. TBD, HB 49, §130.21, eff. 1/1/2018.

Effective Date: 09-26-1996 .

1181.05 Conflicts of interest.

(A) As used in this section, "consumer finance company" means any person required to be licensed or registered under Chapter 1321., 1322., 4712., 4727., or 4728. or sections 1315.21 to 1315.30 of the Revised Code.

(B) Neither the superintendent of financial institutions nor any other employee of the division of financial institutions shall do any of the following: have a business or investment interest, directly or indirectly, in any state bank, trust company, credit union, or consumer finance company that is under the supervision of the superintendent of financial institutions or in any affiliate of any such financial institution or company; directly or indirectly borrow money from any such financial institution or company; serve as a director or officer of or be employed by any such financial institution or company; or own an equity interest in any such financial institution or company or in any of its affiliates. For purposes of this section, an equity interest does not include the ownership of an account in a mutual savings and loan association or in a savings bank that does not have permanent stock or the ownership of a share account in a credit union.

(C) Subject to division (G) of this section, an employee of the division of financial institutions may retain any extension of credit that otherwise would be prohibited by division (B) of this section if both of the following apply:

(1) The employee obtained the extension of credit prior to October 29, 1995, or the commencement of the employee's employment with the division, or as a result of a change in the employee's marital status, the consummation of a merger, acquisition, transfer of assets, or other change in corporate ownership beyond the employee's control, or the sale of the extension of credit in the secondary market or other business transaction beyond the employee's control.

(2) The employee liquidates the extension of credit under its original terms and without renegotiation.

If the employee chooses to retain the extension of credit, the employee shall immediately provide written notice of the retention to the employee's supervisor. Thereafter, the employee shall be disqualified from participating in any decision, examination, audit, or other action that may affect that particular creditor.

(D) Subject to division (G) of this section, an employee of the division of financial institutions may retain any ownership of or beneficial interest in the securities of a financial institution or consumer finance company that is under the supervision of the division of financial institutions, or of a holding company or subsidiary of such a financial institution or company, which ownership or beneficial interest otherwise would be prohibited by division (B) of this section, if the ownership or beneficial interest is acquired by the employee through inheritance or gift, prior to October 29, 1995, or the commencement of the employee's employment with the division, or as a result of a change in the employee's marital status or the consummation of a merger, acquisition, transfer of assets, or other change in ownership beyond the employee's control.

If the employee chooses to retain the ownership or beneficial interest, the employee shall immediately provide written notice of the retention to the employee's supervisor. Thereafter, the employee shall be disqualified from participating in any decision, examination, audit, or other action that may affect the issuer of the securities. However, if the ownership of or beneficial interest in the securities and the subsequent disqualification required by this division impair the employee's ability to perform the employee's duties, the employee may be ordered to divest self of the ownership of or beneficial interest in the securities or to resign.

(E) Notwithstanding division (B) of this section, an employee of the division of financial institutions may have an indirect interest in the securities of a financial institution or consumer finance company that is under the supervision of the division of financial institutions, which interest arises through ownership of or beneficial interest in the securities of a publicly held mutual fund or investment trust, if the employee owns or has a beneficial interest in less than five per cent of the securities of the mutual fund or investment trust, and the mutual fund or investment trust is not advised or sponsored by a financial institution or consumer finance company that is under the supervision of the division of financial institutions. If the mutual fund or investment trust is subsequently advised or sponsored by a financial institution or consumer finance company that is under the supervision of the division of financial institutions, the employee shall immediately provide written notice of the ownership of or beneficial interest in the securities to the employee's supervisor. Thereafter, the employee shall be disqualified from participating in any decision, examination, audit, or other action that may affect the financial institution or consumer finance company. However, if the ownership of or beneficial interest in the securities and the subsequent disqualification required by this division impair the employee's ability to perform the employee's duties, the employee may be ordered to divest self of the ownership of or beneficial interest in the securities or to resign.

(F)

(1) For purposes of this section, the interests of an employee's spouse or dependent child arising through the ownership or control of securities shall be considered the interests of the employee, unless the employee can demonstrate to the satisfaction of the superintendent that the interests are solely the financial interest and responsibility of the spouse or dependent child, the interests are not in any way derived from the income, assets, or activity of the employee, and any financial or economic benefit from the interests is for the personal use of the spouse or dependent child.

(2) If an employee's spouse or dependent child obtains interests arising through the ownership or control of securities and, pursuant to division (F)(1) of this section, the interests are not considered the interests of the employee, the employee shall immediately provide written notice of the interests to the employee's supervisor. Thereafter, the employee shall be disqualified from participating in any decision, examination, audit, or other action that may affect the issuer of the securities.

(G) For purposes of divisions (C) and (D) of this section, both of the following apply:

(1) With respect to any employee of the former division of consumer finance who, on the first day of the first pay period commencing after September 26, 1996, becomes an employee of the division of financial institutions, the employee's employment with the division of financial institutions is deemed to commence on the first day of the first pay period commencing after September 26, 1996.

(2) With respect to any employee who, on October 29, 1995, became an employee of the division of financial institutions, the employee may, notwithstanding divisions (C) and (D) of this section, retain any extension of credit by a consumer finance company that was obtained at any time prior to the first day of the first pay period commencing after September 26, 1996, or retain any ownership of or beneficial interest in the securities of a consumer finance company, or of a holding company or subsidiary of such a company, that was acquired at any time prior to the first day of the first pay period commencing after September 26, 1996. If the employee chooses to retain the extension of credit or the ownership or beneficial interest, the employee shall comply with divisions (C) and (D) of this section.


Amended by 132nd General Assembly File No. TBD, HB 49, §130.21, eff. 1/1/2018.

Effective Date: 09-26-1996; 2008 HB545 09-01-2008 .

1181.06 Financial institutions fund.

There is hereby created in the state treasury the financial institutions fund. The fund shall receive assessments on the banks fund established under section 1121.30 of the Revised Code, the credit unions fund established under section 1733.321 of the Revised Code, and the consumer finance fund established under section 1321.21 of the Revised Code in accordance with procedures prescribed by the superintendent of financial institutions and approved by the director of budget and management. Such assessments shall be in addition to any assessments on these funds required under division (G) of section 121.08 of the Revised Code. All operating expenses of the division of financial institutions shall be paid from the financial institutions fund. Money in the fund shall be used only for that purpose.


Amended by 132nd General Assembly File No. TBD, HB 49, §130.21, eff. 1/1/2018.

Amended by 132nd General Assembly File No. TBD, HB 49, §101.01, eff. 9/29/2017.

Effective Date: 06-30-1999; 04-06-2007 .

1181.07 Office facilities for superintendent.

The state shall furnish the superintendent of financial institutions suitable facilities for conducting the business of the superintendent's office at the seat of government and in any other location within the state where it is necessary to keep a resident examiner.


Amended by 132nd General Assembly File No. TBD, HB 49, §130.21, eff. 1/1/2018.

Effective Date: 09-26-1996 .

1181.08 Adoption of rules.

(A) In addition to the specific authority given the superintendent of financial institutions by other provisions of the Revised Code, the superintendent may from time to time adopt such rules as the superintendent considers necessary or appropriate for the administration of the division of financial institutions or to carry out any other duty of the superintendent.

(B) The superintendent shall not adopt any rule that has a retroactive effective date or apply any rule to conduct that took place exclusively before the effective date of that rule.


Amended by 132nd General Assembly File No. TBD, HB 489, §1, eff. 3/20/2019.

Effective Date: 09-26-1996 .

1181.09 Annual report.

At the conclusion of each fiscal year, the superintendent of financial institutions shall prepare a report on the operation of the division of financial institutions for that year. In conjunction with that report the superintendent shall also prepare a summary of the general condition of each bank, savings and loan association, and savings bank doing business in this state, which summary shall be based on each institution's report of its condition as of the thirtieth day of June of that year.


Effective Date: 09-26-1996 .

1181.10 Seal of superintendent.

The seal of the superintendent of financial institutions shall be surrounded by the words: "The superintendent of financial institutions of the state of Ohio.

The seal shall have engraved on it the coat of arms of the state, as described in section 5.04 of the Revised Code, and shall contain the words and devices mentioned in this section and no other.


Amended by 132nd General Assembly File No. TBD, HB 49, §130.21, eff. 1/1/2018.

Effective Date: 09-26-1996 .

1181.11 Records as evidence.

Copies of all certificates, records, and papers in the office of the superintendent of financial institutions, including the records of the banking commission, the former savings and loan associations and savings banks board, and the credit union council, duly certified by the superintendent or, in the absence of the superintendent, a deputy superintendent having jurisdiction over the records, and authenticated by the superintendent's seal of office, shall be evidence, in all courts of this state, of every matter which could be proved by the production of the original.


Amended by 132nd General Assembly File No. TBD, HB 49, §130.21, eff. 1/1/2018.

Effective Date: 12-02-1996 .

1181.16 [Repealed].


Repealed by 132nd General Assembly File No. TBD, HB 49, §130.23, eff. 1/1/2018.

Repealed by 132nd General Assembly File No. TBD, HB 49, §105.01, eff. 9/29/2017.

Effective Date: 09-22-2000 .

1181.17 [Repealed].


Repealed by 132nd General Assembly File No. TBD, HB 49, §130.23, eff. 1/1/2018.

Repealed by 132nd General Assembly File No. TBD, HB 49, §105.01, eff. 9/29/2017.

Amended by 131st General Assembly File No. TBD, HB 340, §101.01, eff. 12/22/2015.

Effective Date: 09-22-2000 .

1181.18 [Repealed].


Repealed by 132nd General Assembly File No. TBD, HB 49, §105.01, eff. 9/29/2017.

Effective Date: 06-30-1999 .

1181.21 Regulating consumer finance companies.

(A) As used in this section, "consumer finance company" has the same meaning as in section 1181.05 of the Revised Code.

(B) The superintendent of financial institutions shall see that the laws relating to consumer finance companies are executed and enforced.

(C) The deputy superintendent for consumer finance shall be the principal supervisor of consumer finance companies. In that position the deputy superintendent for consumer finance shall, notwithstanding section 1321.421, division (A) of section 1321.76, and sections 1321.07, 1321.55, 1322.34, 4727.05, and 4728.05 of the Revised Code, be responsible for conducting examinations and preparing examination reports under those sections and under Chapter 4712. of the Revised Code. In addition, the deputy superintendent for consumer finance shall, notwithstanding sections 1315.27, 1321.10, 1321.43, 1321.54, 1321.77, 1322.57, 4712.14, 4727.13, and 4728.10 of the Revised Code, have the authority to adopt rules and standards in accordance with those sections. In performing or exercising any of the examination, rule-making, or other regulatory functions, powers, or duties vested by this division in the deputy superintendent for consumer finance, the deputy superintendent for consumer finance shall be subject to the control of the superintendent of financial institutions and the director of commerce.


Amended by 132nd General Assembly File No. TBD, HB 199, §1, eff. 3/23/2018.

Amended by 132nd General Assembly File No. TBD, HB 49, §130.21, eff. 1/1/2018.

Effective Date: 09-26-1996; 2008 HB545 09-01-2008 .

1181.23 [Effective 10/17/2019] Multistate licensing program.

(A) The superintendent of financial institutions may require persons licensed or registered by the division of financial institutions to participate in a multistate licensing system.

(B)

(1) If the superintendent requires use of a multistate licensing system, the superintendent may establish, by rule, regulation, or order, requirements as necessary to enable information required by existing statutes providing for licensing or registration to be submitted to the superintendent through the multistate licensing system.

(2) The superintendent shall not adopt a requirement in conflict with a provision of the Revised Code, but may add to existing requirements with regard to all of the following:

(a) The manner of obtaining required criminal history records, civil or administrative records, or credit history records;

(b) The payment of fees required for the use of the multistate licensing system;

(c) The setting or resetting as necessary of renewal or reporting dates;

(d) The amending of or surrendering of a license or registration.

(C) Any person engaged in activity that requires licensure or registration pursuant to this section shall utilize the multistate licensing system for the application for, renewal of, amendment to, or surrender of a license or registration, as well as for any other activity as the superintendent may require. Such a person shall pay all applicable charges to utilize the multistate licensing system.

(D) The superintendent is authorized to establish relationships or contacts with the multistate licensing system or other entities designated by the multistate licensing system to collect and maintain records and process transaction fees or other fees related to licensees and registrants.

(E) Any confidentiality or privilege arising under federal or state law with respect to any information or material provided to the multistate licensing system shall continue to apply to the information or material after the information or material is provided to the multistate licensing system. The information and material so provided may be released to any state or federal regulatory official with applicable oversight authority without the loss of confidentiality or privilege protections provided by federal law or the law of any state.

(F) The superintendent may use the documents, materials, or other information made available to the superintendent through the multistate licensing system in furtherance of any action brought by the superintendent.


Added by 133rd General Assembly File No. TBD, HB 166, §101.01, eff. 10/17/2019.

1101.01 Banks; definitions.

As used in Chapters 1101. to 1127. of the Revised Code, unless the context requires otherwise:

(A) "Affiliate" has the same meaning as in division (A)(1) of section 1109.53 of the Revised Code and includes a subsidiary of a bank.

(B) "Bank" or "banking corporation" means an entity that solicits, receives, or accepts money or its equivalent for deposit as a business, whether the deposit is made by check or is evidenced by a certificate of deposit, passbook, note, receipt, ledger card, or otherwise. "Bank" or "banking corporation" includes a state bank or any entity doing business as a bank , savings bank, or savings association under authority granted by the office of the comptroller of the currency or the former office of thrift supervision, the appropriate bank regulatory authority of another state of the United States, or the appropriate bank regulatory authority of another country, but does not include a credit union.

(C) "Bank holding company" has the same meaning as in the "Bank Holding Company Act of 1956," 70 Stat. 133, 12 U.S.C. 1841, as amended.

(D) "Banking office" means an office or other place established by a bank at which the bank receives money or its equivalent from the public for deposit and conducts a general banking business. "Banking office" does not include any of the following:

(1) Any location at which a bank receives, but does not accept, cash or other items for subsequent deposit, such as by mail or armored car service or at a lock box or night depository;

(2) Any structure located within five hundred yards of an approved banking office of a bank and operated as an extension of the services of the banking office;

(3) Any automated teller machine, remote service unit, or other money transmission device owned, leased, or operated by a bank;

(4) Any facility located within the geographical limits of a military installation at which a bank only accepts deposits and cashes checks;

(5) Any location at which a bank takes and processes applications for loans and may disburse loan proceeds, but does not accept deposits;

(6) Any location at which a bank is engaged solely in providing administrative support services for its own operations or for other depository institutions.

(E) "Branch" means a banking office that is not also the bank's principal place of business consistent with its articles of incorporation or articles of association.

(F)

(1) With respect to a stock state bank, "capital" means the sum of the bank's:

(a) Paid-in capital and surplus relating to common stock;

(b) To the extent permitted by the superintendent of financial institutions, paid-in capital and surplus relating to preferred stock;

(c) Undivided profits; and

(d) To the extent permitted by the superintendent the proceeds of the sale of debt securities and other assets and reserves.

(2) With respect to a mutual state bank, "capital" means either of the following:

(a) Retained earnings;

(b) At the discretion of the superintendent, any other form of capital, subject to any applicable federal and state laws.

(G) "Code of regulations" includes a constitution adopted by a state bank for similar purposes.

(H) "Control" has the same meaning as in division (H) of section 1109.53 of the Revised Code.

(I) "Debt securities" means obligations issued by a bank the holders of which, in the event of the insolvency or liquidation of the bank, are subordinated in right of payment to the bank's depositors and general creditors.

(J) "Deposit" has the same meaning as in 12 C.F.R. 204.2, as amended.

(K) "Entity" has the same meaning as in section 1701.01 of the Revised Code.

(L) "Federal savings association" means a federal savings and loan association or a federal savings bank doing business under authority granted by the office of the comptroller of the currency or the former office of thrift supervision.

(M) "Mutual holding company" means either of the following:

(1) A mutual state bank or an affiliate of a mutual state bank reorganized in accordance with Chapter 1116. of the Revised Code to hold all or part of the shares of the capital stock of a subsidiary state bank;

(2) A mutual holding company organized in accordance with 12 U.S.C. 1467a(o) that has converted to a mutual holding company under Chapter 1116. of the Revised Code.

(N) "Mutual state bank" means a state bank without stock that has governing documents consisting of articles of incorporation and code of regulations adopted by its members and bylaws adopted by its board of directors.

(O) "National bank" means a bank doing business under authority granted by the office of the comptroller of the currency.

(P) "Net income" means all income realized or earned less all expenses realized or accrued.

(Q) "Paid-in capital" means the aggregate par value of all of a stock state bank's outstanding shares of all classes.

(R) "Person" means an individual, sole proprietorship, partnership, joint venture, association, trust, estate, business trust, limited liability company, corporation, or any similar entity or organization.

(S) "Remote service unit" means an automated facility, operated by a customer of a bank, that conducts banking functions, such as receiving deposits, paying withdrawals, or lending money.

(T) "Reorganization" means a consolidation, merger, or transfer of assets and liabilities pursuant to Chapter 1115. or 1116. of the Revised Code.

(U) "Savings and loan holding company" has the same meaning as in 12 U.S.C. 1467a.

(V) "Savings association" means a savings and loan association doing business under authority granted by the regulatory authority of another state or a federal savings association. "Savings association" also includes a state bank that elects to operate as a savings and loan association under section 1109.021 of the Revised Code.

(W) "Savings bank" means a savings bank doing business under authority granted by the regulatory authority of another state.

(X) "Shares" means any equity interest, including a limited partnership interest and any other equity interest in which liability is limited to the amount of the investment. "Shares" does not include a general partnership interest or any other interest involving general liability.

(Y) "State bank" means a bank doing business under authority granted by the superintendent of financial institutions. "State bank" includes a state bank that elects to operate as a savings and loan association under section 1109.021 of the Revised Code.

(Z) "Stock state bank" means a state bank that has an ownership structure represented by shares of stock.

(AA) "Subsidiary" has the same meaning as in section 1109.53 of the Revised Code.

(BB) "Surplus" means the total of amounts paid for shares in excess of their respective par values, amounts contributed other than for shares, and amounts transferred from undivided profits, less amounts transferred to stated capital.

(CC) "Trust company" means an entity qualified and licensed under section 1111.06 of the Revised Code to solicit or engage in trust business in this state, or a person that is required by Chapter 1111. of the Revised Code to be an entity qualified and licensed under section 1111.06 of the Revised Code to solicit or engage in trust business in this state.

(DD) "Undivided profits" means the cumulative undistributed amount of a bank's net income not otherwise allocated.


Amended by 132nd General Assembly File No. TBD, HB 49, §130.21, eff. 1/1/2018.

Effective Date: 05-21-1997 .