An emergency warranting the immediate transfer of assets and liabilities from one bank to another pursuant to section 1115.15 of the Revised Code exists when, in the opinion of the superintendent such transfer is necessary to prevent the probable failure of one of the banks involved. Factors to be considered by the superintendent in making this determination are: the financial and managerial resources of the banks involved, the future prospects of the banks involved, and the convenience and needs of the public to be served.
Chapter 1301:1-4 | Miscellaneous Provisions
Rule 1301:1-4-04 | Bank's purchase of its own shares.
No stock state bank that wants to purchase shares of its own stock pursuant to authority in its articles of incorporation shall make a purchase without prior written approval from the superintendent of financial institutions. To request the superintendents' approval, stock state a bank shall submit to the superintendent both of the following:
(A) A written plan proposing the purchase that shall address all of the following:
(1) The circumstances surrounding the transaction;
(2) How the stock state bank proposes to finance the share purchase;
(3) How and when the stock state bank will dispose of the shares; and
(4) Any other information the superintendent requires.
(B) Both of the following supporting documents:
(1) Certified board resolution evidencing the directors' decision to purchase the shares; and
(2) Pro forma financial statements.
Rule 1301:1-4-06 | Change in bank control.
(A) As used in this rule:
(1) "Acquisition" means a purchase, assignment, transfer, pledge or other disposition of voting shares, or an increase in percentage ownership of a state bank resulting from a redemption of voting shares.
(2) "Acting in concert" means knowing participation in a joint activity or parallel action towards a common goal of acquiring control of a state bank, whether or not pursuant to an express agreement.
(3) "Person" means an individual, corporation, partnership, trust, association, joint venture, pool, syndicate, sole proprietorship, unincorporated organization, and any other form of entity; and a voting trust, voting agreement, and any group of persons acting in concert.
(4) "Securities" means all equity interests in a bank and includes rights, interests, and powers with respect thereto.
(B) For the purpose of section 1115.06 of the Revised Code, it is presumed, subject to rebuttal, that a person acquiring ownership, control of, or the power to vote ten per cent or more of any class of voting securities of a state bank constitutes the power to direct that bank's management or policies requiring prior notice to the superintendent if either of the following apply:
(1) The state bank has registered securities under section 12 of the Securities Exchange Act of 1934 (15 U.S.C. 78); or
(2) No other person will own, control, or hold the power to vote a greater percentage of that class of voting securities immediately after the transaction. If two or more persons, not acting in concert, each propose to acquire simultaneously equal percentages of ten per cent or more of a class of voting securities of a state bank, each such person shall file prior notice with the superintendent.
Transactions other than those set forth in this paragraph resulting in a person's control of less than twenty-five per cent of a class of voting securities of a state bank are deemed not to constitute control requiring prior notice. A person may request an opportunity to rebut any presumption established by this paragraph with respect to a proposed transaction. In the event of such a request, the superintendent shall afford the person the opportunity to present the person's views in writing or where appropriate, orally before the superintendent or the superintendent's designated representatives either at informal conference discussions or at informal presentations of evidence.
(C) A notice required under division (B) of section 1115.06 of the Revised Code shall contain the following information:
(1) The identity, personal history, and business background and experience of each person by whom or on whose behalf the acquisition is to be made, including each person's material business activities and affiliations during the past five years; a description of any material pending legal or administrative proceedings in which each person is a party; and any criminal indictment or conviction of each person by a state or federal court;
(2) A statement of the assets and liabilities of each person by whom or on whose behalf the acquisition is to be made, as of the end of the fiscal year for each of the five years immediately preceding the date of the notice, together with related statements of income and source and application of funds for each of the fiscal years then concluded, all prepared in accordance with generally accepted accounting principles consistently applied; and an interim statement of the assets and liabilities for each person, together with related statements of income and source and application of funds, as of a date not more than ninety days prior to the date of the filing of the notice;
(3) The terms and conditions of the proposed acquisition and the manner in which the acquisition is to be made;
(4) The identity, source, and amount of the funds or other consideration used or to be used in making the acquisition and, if any part of these funds or other consideration has been or is to be borrowed or otherwise obtained for the purpose of making the acquisition, a description of the transaction, the names of the parties, and any arrangements, agreements, or understandings with the parties;
(5) Any plans or proposals any acquiring person may have to liquidate the state bank, to sell its assets or merge it with any company, or to make any other major change in its business or corporate structure or management;
(6) The identification of any person employed, retained, or to be compensated by an acquiring person, or by any person on an acquiring person's behalf, to make solicitations or recommendations to shareholders for the purpose of assisting in the acquisition, and a brief description of the terms of the employment, retainer, or arrangement for compensation;
(7) Copies of all invitations or tenders or advertisements making a tender offer to stockholders for purchase of their stock to be used in connection with the proposed acquisition; and
(8) Any additional information in the form the superintendent may require by specific request in connection with any particular notice.
(D) To request the written consent of the superintendent to a proposed acquisition of control of a state bank:
(1) A person who is also required to file a notice or application with the federal deposit insurance corporation the federal reserve system in regard to the proposed transaction, pursuant to the Change of Bank Control Act (12 U.S.C. 1817(j)) or section 3 of the Bank Holding Company Act (12 U.S.C. 1842), shall file with the superintendent an originally executed copy of the notice or application.
(2) A person who is not required to file a notice or application with the federal deposit insurance corporation or the federal reserve system in regard to the proposed transaction shall notify the superintendent by letter of the proposed transaction, which letter shall include a summary of the proposed transaction and the reason the person is not required to file a notice or application in regard to the proposed transaction with the federal deposit insurance corporation or the federal reserve system. A person filing notice under this section shall submit the information set forth in division (C) of section 1115.06 of the Revised Code and any other information the superintendent requires.
(E) The sixty-day notice period specified in division (B) of section 1115.06 of the Revised Code shall not commence until the superintendent has accepted the notice required in paragraph (D)(1) or (D)(2) of this rule for processing.
(F) Any person filing notice under this rule shall be required to publish, within ten days from receipt of the superintendent's acceptance for processing of information required to be filed under this rule, an announcement on the proposed acquisition in a newspaper of general circulation in the county in which the state bank has its principal place of business. In the case of information filed with the superintendent in contemplation of a tender offer, publication of the announcement required by this paragraph may be delayed until thirty days after the superintendent's acceptance of the information for processing. Whenever a person required to publish an announcement pursuant to this paragraph is also required by federal law or regulation to publish an announcement regarding the same transaction, the announcement published pursuant to federal law or regulation shall satisfy the publication requirement of this paragraph if the announcement includes all of the information required by this paragraph. The newspaper announcement shall include:
(1) The name of the state bank and the name of each person identified in the information as a proposed acquiror and the proposed date of the acquisition of the securities;
(2) A statement that interested persons may submit comments on the proposed acquisition to the superintendent at the superintendent's place of business for a period of twenty days from the date of publication of the announcement, along with the superintendent's address; and
(3) A statement that the superintendent will consider all public comments received in writing within the twenty days following the required publication.
(G) The superintendent may do either of the following with respect to the newspaper publication requirement:
(1) Permit delay of the publication if the superintendent determines, for good cause, that it is in the public interest to grant a delay; or
(2) Shorten the public comment period, waive the public comment, waive the newspaper publication, or act on a notice before the expiration of a public comment period, if the superintendent determines that either an emergency exists or disclosure of a proposed acquisition, solicitation of public comment, or delay of its action until expiration of the public comment period would seriously threaten the safety or soundness of a state bank.
(H) Any person who is required to file information with the superintendent pursuant to paragraph (E)(1) of this rule shall also file with the superintendent any additional information filed with the federal deposit insurance corporation or the federal reserve system in connection with a notice regarding the same proposed transaction together with a copy of any request from the federal deposit insurance corporation or federal reserve system in response to which such information was filed.
(I) A person acquiring control of a state bank is not required to provide prior notice to the superintendent, but is required to notify the superintendent within ninety days after control is acquired and to provide to the superintendent with any information requested, if the person has acquired control by any of the following means:
(1) Through testate or intestate succession;
(2) Through a bona fide gift;
(3) In satisfaction of a debt previously contracted in good faith, except that the acquiror of a defaulted loan secured by a controlling amount of bank voting shares shall file a notice before the loan is acquired:
(4) Redemption of voting shares by the issuing bank; or
(5) Sale of shares by any shareholder that is not within the control of the person resulting in that person becoming the largest shareholder.
(J) The following transactions do not require notice to the superintendent:
(1) A customary one-time proxy solicitation; and
(2) The receipt of voting securities through a pro rata stock dividend.
Rule 1301:1-4-11 | Procedures for relocating a banking office.
(A) A bank that intends to relocate a banking office within a one-mile radius of the banking office's current location shall, not less than thirty days prior to the effective date of relocation, give the superintendent of financial institutions written notice that includes:
(1) The present and new address of the office to be relocated;
(2) The date the office will open for business in the new location;
(3) How the bank will publicize the relocation; and
(4) A map of the office's new service area with the present and new locations marked.
(B) If federal law requires a bank to give written notice to its federal regulator that meets or exceeds any of the requirements of paragraph (A) of this rule, then the bank may satisfy the requirements of paragraph (A) of this rule by submitting the same notice to the superintendent that the bank submitted to its federal regulator.
(C) For purposes of this rule, the relocation of a banking office includes the consolidation of that office with one or more banking offices within the present service area.
(D) If the date of the relocation stated in the written notice as required by paragraph (A) of this rule changes, the bank shall notify the superintendent in writing of the new date.
(E) In addition to the specific requirements of this rule, the superintendent may at any time require of the bank any other information or actions the superintendent deems necessary or relevant under the circumstances of the relocation.
(F) In emergency circumstances, the superintendent may establish an alternate time period for any time period stated within this rule.
Rule 1301:1-4-12 | Procedures for closing a banking office.
(A) A bank that intends to close a banking office shall do all of the following:
(1) Not less than ninety days prior to the effective date of the banking office closing:
(a) Give written notice to each person who is either a depositor or a holder of a safety deposit box at the banking office. The notice shall state the address of the closing office, the effective date of the closing and the locations of the bank's closest offices. The bank may send one notice to a person who is both a depositor and safety deposit box holder. The notice required by this paragraph may be sent by ordinary mail or may be included with any regularly mailed statement of account activity.
(b) File a written notice of the banking office closing with the superintendent of financial institutions that indicates the location of the closing banking office and effective date of the closing.
(2) Not less than thirty days prior to the effective date of the closing, the bank shall post a notice of the closing in a conspicuous manner on the premises of and on any money transmission device, such as an automated teller machine, at the banking office to be closed stating the effective date of the closing and the locations of the bank's closest offices. The notice shall remain posted continuously until the banking office is closed. If the bank will maintain a money transmission device at the same location after the banking office closing, the bank may include that fact in the notice posted and in the notices required by paragraph (A)(1) of this rule.
(1) If federal law requires a bank to take actions regarding written notices that meet or exceed the requirements of paragraphs (A)(1)(a) and (A)(2) of this rule, then taking actions required under federal law will satisfy the requirements of paragraphs (A)(1)(a) and (A)(2) of this rule.
(2) If federal law requires a bank to give written notice to its federal regulator that meets or exceeds the requirements of paragraph (A)(1)(b) of this rule, then the bank may satisfy the requirements of paragraph (A)(1)(b) of this rule by submitting the same notice to the superintendent that the bank submitted to its federal regulator.
(C) For purposes of paragraph (A)(1) of this rule, a person is a depositor of the banking office to be relocated if the records of the bank show that person's account as having been opened at, or transferred to, the banking office. "Depositor" does not include a person whose account was closed or transferred prior to the time written notice is required to be sent under this rule.
(D) The bank shall notify the superintendent in writing if the effective date of the closing stated in the notice required by paragraph (A)(1)(b) of this rule changes. When a banking office is officially closed, it cannot be reopened. If at some later date the bank proposes to establish a banking office at the same location, the bank shall submit a new application pursuant to section 1117.02 of the Revised Code.
(E) In addition to the specific requirements of this rule, the superintendent may at any time require of the bank any other information or actions the superintendent deems necessary or relevant under the circumstances of the closing.
(F) In emergency circumstances, the superintendent may modify or waive any requirements of this rule.
Rule 1301:1-4-13 | Agency agreement between bank and affiliate and unaffiliated depository institutions.
(A) Subject to paragraphs (C), (D), (E) and (F) of this rule, a bank may contract to receive deposits, renew time deposits, close loans, service loans, and receive payment on loans and other obligations for its customers through an affiliate depository institution, at any and all offices of the affiliate depository institution, without being required to obtain the prior written approval of the superintendent of financial institutions.
(B) A bank that wants to contract to provide services other than those listed in paragraph (A) of this rule or to provide services to its customers through an unaffiliated depository institution must individually seek prior approval from the superintendent in accordance with section 1117.05 of the Revised Code.
(C) A bank may not contract to establish new deposit accounts, extend credit, or create new banking relationships through offices of agent depository institutions.
(D) A bank may not, as agent or as principal through its agent, conduct any activity which the bank is prohibited from conducting under applicable federal or state law.
(E) All agreements to act as agent pursuant to this rule shall be in writing and address the nature of the services to be provided and the rights and responsibilities of each party.
(F) Any agency relationship shall be on terms that are consistent with safe and sound practices.
(G) The banking office of the depository institution acting as agent pursuant to this rule and section 1117.05 of the Revised Code is not considered to be a branch of the contracting depository institution.
Authorized By: –
Five Year Review Date:
Rule 1301:1-4-14 | Retention of "Federal" in name of converted Federal savings association.
Any federal savings association converting to a state bank may retain the term "Federal" in the name of such institution.
Rule 1301:1-4-15 | Converting into a state bank.
(A) This rule describes the procedures and standards governing the superintendent's review and approval of an application by a national bank, bank doing business under authority granted by the bank regulatory authority of another state, a savings association or savings bank doing business under authority of another state, a federal savings association, or a state or federally chartered credit union to convert to a state bank charter.
(B) As used in this rule, the terms "applicant" and "converting institution" refer to a national bank, bank doing business under authority granted by the bank regulatory authority of another state, a savings association or savings bank doing business under authority of another state, a federal savings association, or a state or federally chartered credit union seeking to convert to a state bank charter.
(C) A converting institution shall submit to the superintendent an application for the superintendent's approval of the conversion that includes all of the following:
(1) A plan of conversion;
(2) The proposed articles of incorporation and code of regulations of the proposed state bank;
(3) An officers' certification that the directors and members or shareholders of the applicant have approved the plan of conversion and the proposed articles of incorporation and code of regulations in accordance with the applicable state or federal law and with the applicant's articles of association or incorporation and code of regulations or bylaws;
(4) Any other information the superintendent requires.
(D) Within ten business days after receiving an application required under paragraph C of this rule, the superintendent shall decide whether to accept the application. Within ninety days after accepting an application required under paragraph C of this rule, the superintendent shall approve or deny the application. In determining whether to approve the converting institution's conversion into a state bank, the superintendent shall consider all of the following:
(1) The adequacy of capital and paid in capital of the proposed state bank;
(2) Whether the competence, experience, and integrity of each director, executive officer, and controlling shareholder of the proposed state bank meet the criteria for acquiring control of a state bank as provided in section 1115.06 of the Revised Code;
(3) Whether the proposed state bank affords reasonable promise of successful operation;
(4) Whether the proposed state bank meets the requirements of Chapters 1101. to 1127. of the Revised Code.
The superintendent may extend the time during which the superintendent may approve or deny the application if any of the following applies: the superintendent determines that the applicant has not furnished all information required under paragraph (C) of this rule; in the superintendent's judgment any material information is substantially inaccurate; the superintendent has been unable to complete an investigation of a person described in paragraph (D)(2) of this rule because of any delay caused by, or the inadequate cooperation of, that person; or in the superintendent's discretion.
(E) The superintendent may condition an approval of the conversion of a converting institution into a state bank in any manner the superintendent considers appropriate.
(F) If the superintendent approves a conversion, the superintendent shall forward a certificate of the approval of the conversion and the state bank's articles of incorporation to the secretary of state, and shall issue to the new state bank a certificate of authority to commence business as a state bank. In the case of a state bank resulting from the conversion of a state chartered credit union organized under Chapter 1733 of the Revised Code, the secretary of state shall file the certificate of the superintendent's approval of the conversion and the state bank's articles of incorporation in a manner reflecting the company is no longer doing business under Chapter 1733. of the Revised Code. In the case of a state bank resulting from the conversion of a national bank, bank doing business under authority granted by the bank regulatory authority of another state, savings association or savings bank doing business under authority of another state, a federal savings association, or a federally chartered credit union, the secretary of state shall file the certificate of the superintendent's approval of the conversion and the state bank's articles of incorporation in a manner reflecting the state bank is newly authorized to do business under the laws of this state.
(G) The conversion shall be effective on the date indicated in the superintendent's approval. Without further act or deed, the state bank resulting from the conversion shall have all property, rights, interests, and powers of its predecessor institution within the limits of the charter of the resulting state bank, and all duties, trusts, obligations, and liabilities of the predecessor institution shall continue in the state bank resulting from the conversion.
Rule 1301:1-4-16 | Definition of institution-affiliated party under section 1105.11 of the Revised Code.
The term "institution-affiliated party" shall have the same meaning as in Section 3 of the Federal Deposit Insurance Act, 64 Stat. 873 (1950), 12 U.S.C. 1813, as in effect on July 21, 2010.