2006 New York Code - Power Of The Banking Board To Authorize Savings Banks And Savings And Loan Associations To Exercise The Rights Of Federal Savings Associations And The

 
    * §  14-h.  Power  of the banking board to authorize savings banks and
  savings and loan associations to exercise the rights of federal  savings
  associations  and  the  insurance  powers  of national banks. 1. (a) The
  banking board is hereby authorized and empowered to adopt such rules and
  regulations that are, in its discretion, appropriate to  enable  savings
  banks  and  savings  and  loan  associations  to engage in the insurance
  business to the extent that a bank or trust company has been  authorized
  to engage pursuant to section fourteen-g of this article.
    (b)  Notwithstanding  any other provision of law, the banking board is
  hereby authorized and empowered to adopt such rules or regulations  that
  are,  in its discretion, appropriate to enable savings banks and savings
  and loan associations  to  exercise  any  right,  power,  privilege,  or
  benefit,  to  engage  in  any  activity,  or  to  enter  into  any loan,
  investment, or transaction which a federal savings association, as  such
  term  is  defined  by the Federal Deposit Insurance Act, as amended, (12
  USC 1813(b)(2)), acting either  directly  or  through  a  subsidiary  or
  subsidiaries, may lawfully exercise or into which it may lawfully engage
  or  enter. The banking board may, from time to time, amend or repeal any
  such rule or regulation and may impose such  restrictions  as  it  finds
  necessary  and proper, including, but not limited to, a requirement that
  any right, power, privilege, benefit,  activity,  loan,  investment,  or
  transaction  be  exercised,  conducted,  or  held  in  a subsidiary of a
  savings bank or savings and loan association.
    (c) In the event that federal  savings  associations  located  in  the
  state  of  New  York  lose  the  authority  to  exercise a right, power,
  privilege, or benefit, engage in an activity,  or  enter  into  a  loan,
  investment,  or  transaction,  based upon which comparable authority was
  granted to savings banks or savings and loan  associations  pursuant  to
  this  section,  then,  unless  such authority is authorized by other New
  York state law, or a rule, regulation, or  policy  adopted  pursuant  to
  such  other  New  York state law, or by a judicial decision, the banking
  board shall by rule or regulation act to revoke  the  authorization  for
  savings  banks  and  savings  and  loan  associations  pursuant  to this
  section. Further, a right, power, privilege,  benefit,  activity,  loan,
  investment,  or transaction authorized by rule or regulation pursuant to
  this section shall not exceed and shall be limited  by  any  conditions,
  qualifications,  or  restrictions on the same when exercised by, engaged
  in, or entered into by  federal  savings  associations,  unless  savings
  banks  or  savings  and loan associations are so authorized by other New
  York state law, or a rule, regulation, or  policy  adopted  pursuant  to
  such other New York state law, or by a judicial decision.
    2. Prior to exercising the authority granted pursuant to this section,
  the  banking  board  shall  make a finding that the promulgation of such
  rules or regulations is:
    (a) consistent with the policy of the state of New York as declared in
  section ten of this article and thereby protects  the  public  interest,
  including   the   interests   of  depositors,  creditors,  shareholders,
  stockholders, and consumers; and
    (b) necessary to achieve or maintain parity between savings banks  and
  savings  and  loan  associations  and  federal savings associations with
  respect to rights,  powers,  privileges,  benefits,  activities,  loans,
  investments, or transactions.
    3.  In  those  instances  where  savings  banks  or  savings  and loan
  associations are permitted to engage in the business of insurance  under
  any  rule  or regulation adopted pursuant to this section, they shall do
  so subject to regulation by the insurance department and pursuant to all
  insurance laws, rules, and  regulations;  provided,  however,  that  the
  banking board, in consultation with the superintendent of insurance, may
  exempt savings banks or savings and loan associations from any insurance
  law,  rule,  or  regulation  which has been preempted under federal law,
  rule, or regulation for federal savings associations if such  law,  rule
  or  regulation  has  been  preempted  because  it  applies  to insurance
  activities of savings banks or savings and loan associations and not  to
  those of other entities.
    4.  In  those  instances  where  a  right,  power, privilege, benefit,
  activity,  loan,  investment,  or  transaction  authorized  by  rule  or
  regulation  pursuant  to  this  section  is  subject to regulation by an
  agency, as defined in subdivision one of section one hundred two of  the
  state  administrative  procedure  act,  other  than  the superintendent,
  banking board, or superintendent of insurance, then, when a savings bank
  or savings and loan association exercises such right, power,  privilege,
  or  benefit,  engages  in  such  activity,  or  enters  into  such loan,
  investment, or transaction, unless it is so authorized by other New York
  state law, or a rule, regulation or  policy  adopted  pursuant  to  such
  other  New  York  state  law,  or by a judicial decision, it shall do so
  subject to such regulation to the same extent and in the same manner  as
  such  agency  regulates entities other than savings banks or savings and
  loan  associations,  except  to  the   extent   that   federal   savings
  associations are not subject to such regulation.
    5.  Except  with  respect to a credit unemployment insurance policy, a
  group credit life insurance policy, a group credit health, group  credit
  accident,  or  group credit health and accident policy, or similar group
  credit insurance covering the person  of  the  insured,  savings  banks,
  savings  and  loan  associations,  federal savings associations, and any
  person soliciting the purchase of or selling insurance on  the  premises
  thereof,  must  disclose  or  cause  to  be  disclosed in writing, where
  practicable, in clear and  concise  language,  to  their  customers  and
  prospective  customers  who  are  solicited  therefor that any insurance
  offered or sold:
    (a) is not a deposit;
    (b) is not insured by the federal deposit insurance corporation; and
    (c)  is  not  guaranteed  by  the  savings  bank,  savings  and   loan
  association, or federal savings association.
    6.  Except  with  respect  to  a  flood  insurance  policy,  a  credit
  unemployment insurance policy, group credit  life  insurance  policy,  a
  group  credit  health, group credit accident, or group credit health and
  accident policy, or similar group credit insurance covering  the  person
  of  the  insured,  when  a  customer obtains insurance and credit from a
  savings  bank,  savings  and  loan  association,  or   federal   savings
  association,  then  the  credit  and  insurance  transactions  shall  be
  completed through separate documents. The expense of insurance  premiums
  may  not  be  included  in  the  primary  credit transaction without the
  express written consent of the customer.
    7. Savings banks, savings and loan associations, and  federal  savings
  associations  shall  not  extend  credit,  lease or sell property of any
  kind, or furnish any services, or fix or vary the consideration for  any
  of  the  foregoing,  on  the  condition or requirement that the customer
  obtain insurance from the savings bank, savings and loan association, or
  federal  savings  association,  its  affiliate  or  subsidiary,   or   a
  particular  insurer,  agent,  or  broker;  provided,  however, that this
  prohibition shall  not  prevent  any  savings  bank,  savings  and  loan
  association,  or  federal  savings  association  from  engaging  in  any
  activity described in this subdivision that would  not  violate  section
  106  of  the Bank Holding Company Act Amendments of 1970 (12 USCA § 1971
  et seq.), as interpreted by  the  Board  of  Governors  of  the  Federal
  Reserve  System.  This  prohibition  shall  not  prevent a savings bank,
  savings and  loan  association,  or  federal  savings  association  from
  informing  a  customer  that  insurance is required in order to obtain a
  loan or credit, that loan or credit  approval  is  contingent  upon  the
  customer's  procurement  of  acceptable  insurance, or that insurance is
  available from the  savings  bank,  savings  and  loan  association,  or
  federal  savings  association; provided, however, that the savings bank,
  savings and loan association, or federal savings association shall  also
  inform  the  customer  in  writing  that  his or her choice of insurance
  provider  shall  not  affect  the  savings  bank's,  savings  and   loan
  association's,  or  federal  savings  association's  credit  decision or
  credit terms in any way. Such disclosure shall be given prior to  or  at
  the  time  that  a  savings  bank, savings and loan association, federal
  savings association, or person selling insurance on the premises thereof
  solicits the purchase of any insurance from a customer who  has  applied
  for a loan or extension of credit.
    8.  No  savings bank, savings and loan association, or federal savings
  association shall require a  debtor,  insurer,  or  insurance  agent  or
  broker  to  pay  a  separate  charge  in connection with the handling of
  insurance that is required in connection with a loan or other  extension
  of credit or the provision of another traditional banking product solely
  because  the insurance is being provided by an insurance agent or broker
  which is not the savings bank, savings  and  loan  association,  federal
  savings association, or any subsidiary or affiliate thereof.
    9.  Any savings bank, savings and loan association, or federal savings
  association, and any subsidiary or affiliate thereof, which is  licensed
  to  sell  insurance  in  this state shall maintain separate and distinct
  books and records relating to its insurance transactions, including  all
  files relating to and reflecting consumer complaints, and such insurance
  books  and  records  shall  be  made  available to the superintendent of
  insurance for inspection upon reasonable notice.
    10. The promulgation of rules or regulations pursuant to this  section
  shall  be  in accordance with the provisions of the state administrative
  procedure act, with the additional  requirement  that  any  rule  making
  notice  shall cite the specific federal authority that enables a federal
  savings association to exercise the right, power, privilege, or benefit,
  engage  in  the  activity,  or  enter  into  the  loan,  investment,  or
  transaction  which  the  banking board is proposing to extend to savings
  banks or savings and loan associations.
    11. Nothing contained in this section shall be deemed to authorize the
  banking board to  promulgate  rules  or  regulations  pursuant  to  this
  section   which  would  permit  a  savings  bank  or  savings  and  loan
  association to exercise any power except in a manner consistent with the
  following provisions of law, in each case, as  the  terms  contained  in
  such provisions may be amended from time to time:
    (a) chapter one of the laws of nineteen hundred ninety-four;
    (b) chapter nine of the laws of nineteen hundred ninety-six; and
    (c)  sections  fourteen-c  and  twenty-eight-b  of  this  article  and
  sections two hundred forty and three hundred ninety-six of this chapter.
    12.  On  or  before  June  first,  two  thousand  four  and   annually
  thereafter,  the  superintendent  shall submit a report to the governor,
  the speaker of the assembly, the temporary president of the senate,  and
  the  minority  leaders  of  the senate and assembly which shall include,
  with respect to the authority provided for in this section:
    (a) a listing of savings banks and savings and loan associations  that
  have  been  retained  or established or that have converted to a federal
  savings association and the resulting number of jobs created,  retained,
  or lost in the state by virtue thereof; and
    (b)  a  review  and analysis of the extent to which the actions of the
  banking board meet the criteria set forth in  subdivision  two  of  this
  section.
    13.   On  or  before  June  first,  two  thousand  four  and  annually
  thereafter,  the  superintendent  shall,   in   conjunction   with   the
  superintendent  of  insurance,  submit  a  report  to  the governor, the
  temporary president of the senate, the speaker of the assembly, and  the
  minority leaders of the senate and assembly which assesses the impact of
  the  provisions  of this section which apply to the insurance activities
  of savings banks and savings and loan associations.
    * NB Repealed September 10, 2007