2013 Indiana Code TITLE 28. FINANCIAL INSTITUTIONS ARTICLE 2. BANKS CHAPTER 16. FOREIGN BANK HOLDING COMPANIES
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IC 28-2-16
Chapter 16. Foreign Bank Holding Companies
IC 28-2-16-1
"Acquire" defined
Sec. 1. As used in this chapter, "acquire" means directly or
indirectly:
(1) to merge or consolidate with;
(2) to assume control of; or
(3) to purchase all or substantially all of the assets of.
As added by P.L.279-1987, SEC.9.
IC 28-2-16-2
"Bank"
Sec. 2. (a) As used in this chapter, "bank" means a financial
institution:
(1) that has been organized or reorganized under the laws of the
United States, any state of the United States, or the District of
Columbia; and
(2) that:
(A) is an "insured bank" (as defined in Section 3(h) of the
Federal Deposit Insurance Act (12 U.S.C. 1813(h)) or is
eligible to make application to become an insured depository
institution under Section 5 of the Federal Deposit Insurance
Act (12 U.S.C. 1815); or
(B) is a stock savings bank that was formed as a result of
conversion under IC 28, incorporated under IC 28-12, or
organized or reorganized under the laws of any other state of
the United States.
(b) Except as provided in subsection (a)(2)(B), the term "bank"
does not include:
(1) any institution that has been or is chartered or regulated as
a federal savings association or federal savings bank under
Section 5 of the Home Owners Loan Act (12 U.S.C. 1464);
(2) institutions of the "Farm Credit System" as described in 12
U.S.C. 2001 through 2260, which include the Farm Credit
Banks, the Federal Land Bank Associations, the Production
Credit Associations, the Banks for Cooperatives, and any other
institution that may become a part of the Farm Credit System,
as chartered by and subject to the supervision of the Farm
Credit Administration; or
(3) any other institution that has been organized or reorganized
as a savings association, a credit union, or an industrial loan and
investment company.
As added by P.L.279-1987, SEC.9. Amended by P.L.33-1991,
SEC.38; P.L.42-1993, SEC.67; P.L.122-1994, SEC.92; P.L.79-1998,
SEC.64; P.L.27-2012, SEC.78.
IC 28-2-16-3
"Bank holding company" defined
Sec. 3. (a) As used in this chapter, "bank holding company" means
any company that controls one (1) or more banks.
(b) For the purposes of this chapter:
(1) a company is not a bank holding company by virtue of its
ownership or control of shares in a fiduciary capacity, unless
the shares are held for the benefit of the shareholders of the
company;
(2) a company is not a bank holding company by virtue of its
ownership or control of shares that are acquired by the company
in connection with its underwriting of securities and that are
held only for a period of time as will permit the sale of the
shares on a reasonable basis;
(3) a company formed for the sole purpose of participating in a
proxy solicitation is not a bank holding company by virtue of its
control of voting rights of shares acquired in the course of the
solicitation; and
(4) a company is not a bank holding company by virtue of its
ownership or control of shares acquired in securing or
collecting a debt previously contracted in good faith, until two
(2) years after the date of acquisition.
The department may extend, from time to time but for not more than
one (1) year at a time, the two (2) year period referred to in
subdivision (4), but the extensions may not, in the aggregate, exceed
three (3) years.
(c) For the purposes of this chapter, any successor to a bank
holding company is a bank holding company from the date the
predecessor company became a bank holding company.
As added by P.L.279-1987, SEC.9.
IC 28-2-16-4
"Bank subsidiary" defined
Sec. 4. As used in this chapter, "bank subsidiary" means a bank
controlled by a bank holding company.
As added by P.L.279-1987, SEC.9.
IC 28-2-16-5
"Company" defined
Sec. 5. As used in this chapter, "company" means any corporation,
limited liability company, partnership, joint-stock company, business
trust, voting trust, joint venture, association, or similar organization
that has been organized or reorganized under the laws of the United
States, any state of the United States, or the District of Columbia.
The term may or may not include a bank holding company as the
context indicates. The term does not include a bank.
As added by P.L.279-1987, SEC.9. Amended by P.L.8-1993,
SEC.447.
IC 28-2-16-6
"Control" defined
Sec. 6. As used in this chapter, "control" means directly or
indirectly:
(1) to own, control, or hold, with power to vote, twenty-five
percent (25%) or more of the voting shares of a bank or
company;
(2) to control in any manner the election of a majority of the
directors or trustees of a bank or company; or
(3) to exercise a controlling influence over the management or
policies of a bank or company, as determined by the Board of
Governors of the Federal Reserve System after notice and
opportunity for hearing.
As added by P.L.279-1987, SEC.9.
IC 28-2-16-7
"Department" defined
Sec. 7. As used in this chapter, "department" refers to the
department of financial institutions created under IC 28-11-1-1.
As added by P.L.279-1987, SEC.9. Amended by P.L.33-1991,
SEC.39.
IC 28-2-16-8
"Deposits" defined
Sec. 8. As used in this chapter, "deposits" has the meaning set
forth in IC 28-2-14-8.
As added by P.L.279-1987, SEC.9. Amended by P.L.33-1991,
SEC.40.
IC 28-2-16-9
"Foreign bank holding company" defined
Sec. 9. As used in this chapter, "foreign bank holding company"
means a bank holding company that has its principal place of
business in a state other than Indiana.
As added by P.L.279-1987, SEC.9.
IC 28-2-16-10
Repealed
(Repealed by P.L.33-1991, SEC.57.)
IC 28-2-16-11
"Indiana bank" defined
Sec. 11. As used in this chapter, "Indiana bank" means a bank that
has its principal office in Indiana.
As added by P.L.279-1987, SEC.9.
IC 28-2-16-12
"Indiana bank holding company" defined
Sec. 12. As used in this chapter, "Indiana bank holding company"
means a bank holding company that has its principal place of
business in Indiana.
As added by P.L.279-1987, SEC.9.
IC 28-2-16-13
"Indiana bank subsidiary" defined
Sec. 13. As used in this chapter, "Indiana bank subsidiary" means
an Indiana bank that is controlled by a bank holding company.
As added by P.L.279-1987, SEC.9.
IC 28-2-16-14
"Principal place of business" defined
Sec. 14. For the purposes of this chapter, the "principal place of
business" of a bank holding company is the state in which the total
deposits of the bank subsidiaries of the bank holding company are
the largest.
As added by P.L.279-1987, SEC.9.
IC 28-2-16-15
Acquisition of financial institutions
Sec. 15. Subject to the limitations of this chapter, a foreign bank
holding company is entitled to acquire one (1) or more:
(1) Indiana banks;
(2) Indiana bank holding companies; or
(3) foreign bank holding companies that have acquired one (1)
or more Indiana banks;
after approval by the department.
As added by P.L.279-1987, SEC.9. Amended by P.L.33-1991,
SEC.41; P.L.42-1993, SEC.68.
IC 28-2-16-16
Repealed
(Repealed by P.L.171-1996, SEC.44.)
IC 28-2-16-17
Foreign bank holding company acquisition of Indiana bank or
bank holding company; application; investigation; factors
considered; findings; conditions and restrictions upon acquisition
Sec. 17. (a) If a foreign bank holding company desires to acquire
an Indiana bank or Indiana bank holding company under this chapter,
the foreign bank holding company must file an application for
approval of the acquisition with the department on forms prescribed
by the department. Upon receipt of an application under this section,
the department may:
(1) accept the application for processing;
(2) request additional information to complete the application;
or
(3) return the application if it is substantially incomplete.
The department shall take one (1) of the actions listed in this
subsection within ten (10) business days after receiving the
application. Within ten (10) business days after acceptance of an
application for processing, the department shall notify the applicant
and the bank or bank holding company proposed to be acquired of its
acceptance of the application. The applicant shall publish notice of
the acceptance of the application in a newspaper of general
circulation in each county in which is located the principal office or
a branch of the bank proposed to be acquired or a bank subsidiary of
the bank holding company proposed to be acquired.
(b) Upon accepting an application for processing under subsection
(a)(1), the department shall conduct an investigation, to the extent the
department considers necessary, into the condition of the applicant
and the Indiana bank or Indiana bank holding company proposed to
be acquired. The department may request additional information
from the applicant and may hold public hearings with respect to the
proposed acquisition. The department may require the applicant to
produce any additional information the department considers
necessary for the hearing. The department shall commence any
public hearing held under this section not less than thirty (30) days
and not more than sixty (60) days after the department's acceptance
of an application for processing. The hearing shall be held at a place,
date, and time specified by the department. The department may
assign the task of conducting the hearing to a member or an
employee of the department. If the department decides to hold a
public hearing under this section, the department shall send written
notice to the applicant no later than thirty (30) days after the
department's acceptance of an application for processing and at least
twenty (20) days before the hearing. The department shall also send
written notice to the principal office of the Indiana bank proposed to
be acquired or to the principal office of each Indiana bank subsidiary
of the Indiana bank holding company proposed to be acquired at least
twenty (20) days before the hearing and shall publish notice of the
hearing at least twenty (20) days before the hearing in a newspaper
of general circulation in each county in which is located the principal
office or a branch of:
(1) the Indiana bank; or
(2) an Indiana bank subsidiary of the Indiana bank holding
company;
proposed to be acquired. The shareholders of the bank or bank
holding company proposed to be acquired and the shareholders of the
applicant may appear and offer evidence at the hearing. At least ten
(10) days before the hearing, a person desiring to appear and offer
testimony must give the department written notice of the person's
intent to testify. The applicant shall pay all expenses of publication,
court reporter fees, department expenses, appropriate department per
diem expenses, and hearing room fees, as determined by the
department.
(c) The department shall either approve or disapprove the
proposed acquisition within:
(1) sixty (60) days after the acceptance of an application for
processing, if the department elects not to hold a public hearing;
or
(2) thirty (30) days after any public hearing held with respect to
the proposed acquisition, if the department elects to hold a
public hearing.
The department may extend the period for consideration of the
application, upon written notice to the applicant, if the department
determines that further information from the applicant is necessary
for its decision or that any material information submitted is
substantially inaccurate. However, an extension may not exceed an
additional thirty (30) days.
(d) The department may not authorize an acquisition under this
chapter unless the provisions of this chapter have been met.
(e) In deciding whether to approve an acquisition under this
chapter, the department shall consider the following factors:
(1) Whether the banks already controlled by the applicant are
operated in a safe, sound, and prudent manner.
(2) Whether the financial condition of the applicant or any of its
affiliates will jeopardize the financial stability of the Indiana
bank or Indiana bank holding company proposed to be acquired.
(3) Whether the proposed merger or acquisition will result in an
Indiana bank that has inadequate capital, unsatisfactory
management, or poor earnings prospects.
(4) Whether banks already controlled by the applicant have
provided adequate and appropriate services, including services
contemplated by the Community Reinvestment Act of 1977 (12
U.S.C. 2901 et seq.), to the communities in which they are
located.
(5) Whether the applicant proposes to provide adequate and
appropriate services, including services contemplated by the
Community Reinvestment Act of 1977 (12 U.S.C. 2901 et seq.),
in the communities served by the Indiana bank or Indiana bank
holding company proposed to be acquired.
(6) Whether the management or other principals of the applicant
are qualified by character and financial responsibility to control
and operate in a legal and proper manner the Indiana bank or
Indiana bank holding company proposed to be acquired.
(7) Whether the interest of the depositors and creditors of the
Indiana bank or Indiana bank holding company proposed to be
acquired and the interest of the public generally will be
jeopardized by the proposed acquisition.
(8) Whether the applicant furnishes all the information the
department requires in reaching its decision.
(9) If the department holds a hearing under section 18 of this
chapter, the finding required by section 19 of this chapter.
(f) The department shall make any acquisition by a foreign bank
holding company subject to any conditions, restrictions, and
requirements that:
(1) would apply to the acquisition by an Indiana bank holding
company of a bank or bank holding company in the state where
the foreign bank holding company has its principal place of
business; and
(2) would not apply to the acquisition of a bank or bank holding
company in that state by a bank holding company that controls
only banks located in that state.
As added by P.L.279-1987, SEC.9. Amended by P.L.33-1991,
SEC.43; P.L.262-1995, SEC.59; P.L.171-1996, SEC.35.
IC 28-2-16-18
Exchange of stock of foreign bank holding company acquiring
Indiana bank or bank holding company; request for hearing
Sec. 18. (a) At the time of the filing of an application with the
department, the applicant may submit a written request asking the
department to hold a hearing upon the fairness of the terms,
conditions, and provisions of the proposed issuance and exchange of
stock of the applicant for the stock of the Indiana bank or Indiana
bank holding company. If a request is submitted under this
subsection, the department may hold a public hearing upon the
fairness of the exchange or upon any other matter with respect to the
proposed acquisition. The shareholders of a bank or bank holding
company proposed to be acquired and the shareholders of the
applicant may appear and offer evidence at any public hearing at
which the fairness of the exchange is to be determined. At least ten
(10) days before the hearing, a person desiring to appear and offer
testimony must give the department written notice of the person's
intent to testify. The department may require the applicant to produce
such evidence as the department considers necessary to the hearing.
(b) Any public hearing held under this section must commence
not less than thirty (30) days and not more than sixty (60) days after
the date on which the department accepts the application for
processing under section 17 of this chapter. If the department decides
to hold a public hearing under this section, it shall notify the
applicant no later than thirty (30) days after the department's
acceptance of an application for processing and at least twenty (20)
days before the hearing. The public hearing shall be held at a place,
date, and time specified by the department. The department may
combine any hearing held under this section with a hearing held
under section 17 of this chapter. The department may assign the task
of conducting the hearing to a member or employee of the
department. If the department decides to hold a public hearing under
this section, the applicant shall provide written notice of the date,
time, place, and purpose of the hearing to each Indiana bank and each
Indiana subsidiary of a bank holding company that has an office in
a county in which the Indiana bank proposed to be acquired or an
Indiana bank subsidiary of the Indiana bank holding company
proposed to be acquired has a principal office or branch. The Indiana
bank or Indiana bank holding company proposed to be acquired shall
transmit the written notice to its shareholders. The notice must also
be published at least twenty (20) days before the date of the hearing
in a newspaper of general circulation in each county in which is
located the principal office or a branch of the bank proposed to be
acquired or the principal office or a branch of a bank subsidiary of
the bank holding company proposed to be acquired. The notice must
contain any other provision as the department may require. The
applicant shall pay all expenses of providing the notice, publication,
court reporter fees, department expenses, appropriate department per
diem expenses, and hearing room fees, as determined by the
department.
(c) The issuance of securities described in subsection (d) is a
transaction exempted from the registration requirements of
IC 23-19-3-1 if, at the time the applicant submits a written request to
the department under subsection (a), the applicant also submits to the
securities commissioner appointed under IC 23-19-6-1(a) a notice in
writing of all terms of the transaction and if the securities
commissioner does not disallow the exemption within the next five
(5) full business days.
(d) Subsection (c) applies to any security issued in exchange for
one (1) or more bona fide outstanding securities, claims, or property
interests, or partly in that exchange and partly for cash, under terms
and conditions approved by the department after a hearing held under
this section.
As added by P.L.279-1987, SEC.9. Amended by P.L.262-1995,
SEC.60; P.L.27-2007, SEC.30.
IC 28-2-16-19
Foreign bank holding company acquisition of Indiana bank or
bank holding company; findings and orders
Sec. 19. If the department accepts an application for processing
under section 17 of this chapter, the department shall issue an order
approving or disapproving the acquisition. The department shall
include its findings of fact in the order. If the department holds a
hearing under section 18 of this chapter, the findings of fact must
include a finding that the terms and conditions of the acquisition and
of the issuance and exchange of stock of the applicant for the stock
of the Indiana bank or Indiana bank holding company proposed to be
acquired are or are not fair and reasonable to the shareholders of the
Indiana bank or Indiana bank holding company proposed to be
acquired.
As added by P.L.279-1987, SEC.9.
IC 28-2-16-20
Qualification to acquire Indiana bank or bank holding company;
divestiture upon ceasing to qualify
Sec. 20. (a) Except as expressly permitted by federal law, a bank
holding company that is not:
(1) an Indiana bank holding company; or
(2) a foreign bank holding company;
may not acquire an Indiana bank or Indiana bank holding company.
(b) An Indiana bank holding company that ceases to be an Indiana
bank holding company, as defined in section 12 of this chapter, or a
foreign bank holding company that ceases to be a foreign bank
holding company, as defined in section 9 of this chapter, shall within
three (3) years divest itself of all Indiana banks and Indiana bank
holding companies. However, a foreign bank holding company or
Indiana bank holding company may not be required to divest itself of
its Indiana banks or bank holding companies because of:
(1) its acquisition of institutions in another state, if the
acquisition has been consummated under Section 116 or 123 of
the Garn-St. Germain Depository Institutions Act of 1982 (12
U.S.C. 1730a(m) or 12 U.S.C. 1823(f));
(2) its acquisition of securities or assets of a bank having
banking offices in another state, if the acquisition has been
consummated in the regular course of securing or collecting a
debt previously contracted in good faith, and if the bank or bank
holding company divests itself of the securities or assets
acquired within three (3) years of the date of acquisition; or
(3) its acquisition of:
(A) a bank or company organized under the laws of the
United States or of any state and operating under Section 25
or Section 25(a) of the Federal Reserve Act, as amended (12
U.S.C. 601 through 604a or 12 U.S.C. 611 through 631); or
(B) a bank or bank holding company that was organized
under the laws of a foreign country, that is principally
engaged in business outside the United States, and that either
has no banking office in the United States or has banking
offices in the United States that are engaged only in business
activities permissible for a bank or corporation operating
under Section 25 or 25(a) of the Federal Reserve Act, as
amended.
As added by P.L.279-1987, SEC.9. Amended by P.L.33-1991,
SEC.44.
IC 28-2-16-21
Exemption from IC 28-1-2-23
Sec. 21. (a) An acquisition by a foreign bank holding company of
control of an Indiana bank or Indiana bank holding company is
exempt from the requirements of IC 28-1-2-23 if the acquisition is
made under this chapter.
(b) If a bank will be:
(1) acquired by a foreign bank holding company; and
(2) immediately merged with or consolidated into another bank
owned by the acquiring foreign bank holding company;
the acquisition of the bank is exempt from the provisions of this
chapter.
As added by P.L.279-1987, SEC.9. Amended by P.L.262-1995,
SEC.61.
IC 28-2-16-22
Injunctions
Sec. 22. Any person, company, bank, or bank holding company
that may be or has been injured by reason of any conduct that
constitutes or will constitute a violation of this chapter by any
company or bank holding company may sue the company or bank
holding company to enjoin the conduct or for damages, together with
the costs of suit, including reasonable attorney's fees. In addition, the
department may sue to enjoin any conduct that constitutes or will
constitute a violation of this chapter, or to require divestiture of any
bank or bank holding company acquired in violation of this chapter.
As added by P.L.279-1987, SEC.9.
IC 28-2-16-23
Cooperation with other financial institutions' regulatory agencies
Sec. 23. The department may enter into cooperative agreements
and pay for necessary services with other financial institutions'
regulatory agencies to facilitate the regulation of banks, corporate
fiduciaries, and bank holding companies doing business in this state.
The department may accept reports of examinations and other
records from those other agencies instead of conducting its own
examinations of corporate fiduciaries with offices in other states or
banks controlled by bank holding companies located in other states.
The department may take any action jointly with other regulatory
agencies having concurrent jurisdiction over banks, corporate
fiduciaries, and bank holding companies doing business in this state
or may take actions independently in order to carry out its
responsibilities.
As added by P.L.279-1987, SEC.9. Amended by P.L.262-1995,
SEC.62.
IC 28-2-16-24
Repealed
(Repealed by P.L.215-1999, SEC.16.)
IC 28-2-16-25
Rules
Sec. 25. The department may adopt rules under IC 4-22-2 to
implement this chapter.
As added by P.L.279-1987, SEC.9.
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