2018 Code of Alabama
Section 5-20-4 - Establishment or acquisition of a credit card bank.

Universal Citation: AL Code § 5-20-4 (2018)
Section 5-20-4Establishment or acquisition of a credit card bank.

Subject to the provisions of this chapter and to the prior approval of the superintendent, any bank holding company, bank holding company subsidiary, domestic lender or foreign lender may, either singly or jointly with other bank holding companies, bank holding company subsidiaries, domestic lenders or foreign lenders, establish or acquire, and own and control all the voting shares of a single credit card bank located in Alabama when and for so long as the following conditions are satisfied:

(1) If the credit card bank is to be organized under the laws of this state, such bank shall be organized as provided in this chapter and in the manner provided in Chapter 5A of this title;

(2) In connection with the application to organize, or to acquire control of a credit card bank, the applicant or applicants shall pay one filing fee to the Alabama Department of Banking in an amount not less than $15,000 to be set by the superintendent and approved by the Alabama Department of Banking;

(3) The shares of a credit card bank shall be owned only by one or more bank holding companies, bank holding company subsidiaries, domestic lenders or foreign lenders;

(4) Each credit card bank shall have total initial capital accounts actually paid in of not less than $1,750,000, and at all times thereafter shall maintain such minimum capital together with such additional capital accounts such that it shall have total capital not less than that capital generally required of Alabama banks supervised by the superintendent;

(5) The credit card bank may engage only in the business of soliciting, processing, and extending credit pursuant to credit card accounts and conducting such other activities as are incidental thereto and not inconsistent with the provisions of this chapter;

(6) The credit card bank shall not accept demand deposits or deposits that are withdrawable by check or similar means for payment to third parties or others, and shall not accept any savings or time deposits of less than $100,000;

(7) The credit card bank must operate only a single office in this state, and such office's location and manner of operation shall be limited so as to be not likely to attract customers from the general public in this state to the substantial detriment of banks and depository institutions located in this state; and

(8) A credit card bank, owned singly or jointly by a foreign lender or by a foreign bank holding company or by a subsidiary thereof, shall have, within one year of the date it commences operations, no fewer than 40 employees located in this state devoted to its credit card activities.

An Alabama bank or a domestic lender is not required to establish a credit card bank to issue credit cards and create credit card accounts.

(Acts 1988, No. 88-85, p. 104, §1.)
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