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286.3-199 Closing of banks -- Emergency.
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As used in this section, unless the context requires otherwise:
(a) "Commissioner" means the commissioner of financial institutions and any
other person lawfully exercising the powers of the commissioner.
(b) "Officers" means the person or persons designated by the board of
directors of a bank to act for the bank in carrying out the provisions of this
section.
(c) "Emergency" means any condition which interferes with the conduct of
normal business operations at one (1) or more or all offices of a bank or
banks, or which poses an imminent or existing threat to the safety and
security of persons or property, or both. Without limiting the generality of
the foregoing an emergency may arise as a result of any one (1) or more
of the following: fire, flood, wind, rain or snowstorms, labor disputes,
power failures, transportation failures, war and riots, civil commotions,
and other acts of lawlessness or violence.
(d) "Office" means any place at which a bank transacts business or conducts
operations related to the transaction of business.
(e) "Person" includes natural persons, corporations, partnerships and
associations.
Whenever the commissioner is of the opinion that an emergency exists in this
state or in any part or parts of this state, the commissioner shall, by
proclamation, authorize those banks which, in the opinion of their officers, are
directly or indirectly affected by such emergency to close one (1) or more or all
their offices.
Whenever the officers of a bank are of the opinion that an emergency exists
which affects one (1) or more or all the bank's offices, they shall have authority
to close one (1) or more or all such offices even though the commissioner has
not issued a proclamation of emergency, and they may provide that the
business normally transacted at a closed office will be transacted at another
office designated by the bank until further notice. The office or offices so closed
shall remain closed until the commissioner proclaims that the emergency has
ended, or until such earlier time as the officers of the bank determine that one
(1) or more offices, theretofore closed because of the emergency, should
reopen, or, if the commissioner has issued no proclamation of emergency, until
the officers of the bank determine that such office or offices should reopen. The
discretion of the officers in acting pursuant to this section, when exercised in
good faith, shall not be questioned in any court or place.
A bank closing an office or offices pursuant to this section shall give prompt
notice to the commissioner as conditions will permit.
No bank and no director, officer or employee of a bank shall be liable to any
person for any direct or indirect loss suffered by reason of the bank's failure or
inability to make access to the bank's premises and facilities available to such
person or by reason of the bank's failure or delay in performing any contractual,
statutory or other duty assumed by or imposed upon the bank in any capacity
when such failure, inability or delay is caused by an emergency as defined by
this section. The immunity from liability provided for herein shall endure during
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the period of such emergency and for such time thereafter as may reasonably
be necessary to afford such access or perform such duty.
The provisions of this section shall be construed and applied as being in
addition to any other law of this state or United States excusing delays by
banks in the performance of duties or obligations, or authorizing the closing of
banks because of emergencies or conditions beyond the bank's control, or
otherwise.
The commissioner may make such orders and regulations, not inconsistent
with this section, as he or she shall deem necessary during an emergency to
provide for the uninterrupted continuance of business by banks to the extent
consistent with the safety and security of persons and property.
Effective:July 15, 2010
History: Amended 2010 Ky. Acts ch. 24, sec. 631, effective July 15, 2010. -Amended 1984 Ky. Acts ch. 324, sec. 20, effective July 13, 1984. -- Created
1972 Ky. Acts ch. 111, sec. 1.
Formerly codified as KRS 287.199.
Legislative Research Commission Note (7/12/2006). In accordance with 2006
Ky. Acts ch. 247, secs. 38 and 39, this statute has been renumbered as a
section of the Kentucky Financial Services Code, KRS Chapter 286.
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