AB1-ASA1-AA1,192,20
20222.0102 Definitions. In this chapter:
AB1-ASA1-AA1,192,23
21(1) "Capital" of a universal bank means the sum of the following, less the
22amount of intangible assets that is not considered to be qualifying capital by a deposit
23insurance corporation or the division:
AB1-ASA1-AA1,193,5
1(a) For a universal bank organized as a stock organization, the universal bank's
2capital stock, preferred stock, undivided profits, surplus, outstanding notes and
3debentures approved by the division, other forms of capital designated as capital by
4the division, and other forms of capital considered to be qualifying capital of the
5universal bank by a deposit insurance corporation.
AB1-ASA1-AA1,193,106
(b) For a universal bank organized as a mutual organization, the universal
7bank's net worth, undivided profits, surplus, outstanding notes and debentures
8approved by the division, other forms of capital designated as capital by the division,
9and other forms of capital considered to be qualifying capital by a deposit insurance
10corporation.
AB1-ASA1-AA1,193,14
11(2) "Deposit insurance corporation" means the Federal Deposit Insurance
12Corporation or other instrumentality of, or corporation chartered by, the United
13States that insures deposits of financial institutions and that is supported by the full
14faith and credit of the U.S. government as stated in a congressional resolution.
AB1-ASA1-AA1,193,15
15(3) "Division" means the division of banking.
AB1-ASA1-AA1,193,18
16(4) "Financial institution" means a state savings bank organized under ch. 214,
17state savings and loan association organized under ch. 215, or state bank chartered
18under ch. 221.
AB1-ASA1-AA1,193,20
19(5) "Universal bank" means a financial institution that has been issued a
20certificate of authority under s. 222.0205.
AB1-ASA1-AA1,193,21
21(6) "Well-capitalized" has the meaning given in
12 USC 1831o (b) (1) (A).
AB1-ASA1-AA1,194,2
22222.0103 Applicability. (1) Savings banks. A universal bank that is a savings
23bank organized under ch. 214 remains subject to all of the requirements, duties, and
24liabilities, and may exercise all of the powers, of a savings bank, except that, in the
1event of a conflict between this chapter and those requirements, duties, liabilities,
2or powers, this chapter shall control.
AB1-ASA1-AA1,194,7
3(2) Savings and loan associations. A universal bank that is a savings and loan
4association organized under ch. 215 remains subject to all of the requirements,
5duties, and liabilities, and may exercise all of the powers, of a savings and loan
6association, except that, in the event of a conflict between this chapter and those
7requirements, duties, liabilities, or powers, this chapter shall control.
AB1-ASA1-AA1,194,11
8(3) Banks. A universal bank that is a bank chartered under ch. 221 remains
9subject to all of the requirements, duties, and liabilities, and may exercise all of the
10powers, of a bank, except that, in the event of a conflict between this chapter and
11these requirements, duties, liabilities, or powers, this chapter shall control.
AB1-ASA1-AA1,194,14
12222.0105 Fees. The division may establish such fees as it determines are
13appropriate for documents filed with the division under this chapter and for services
14provided by the division under this chapter.
AB1-ASA1-AA1,194,16
15222.0107 Administration. (1) Powers of division. The division shall
16administer this chapter for all universal banks.
AB1-ASA1-AA1,194,21
17(2) Rule-making authority. The division may promulgate rules to administer
18and carry out this chapter. The division may establish additional limits or
19requirements on universal banks, if the division determines that the limits or
20requirements are necessary for the protection of depositors, members, investors, or
21the public.
AB1-ASA1-AA1,194,2322
SUBCHAPTER II
23
Certification
AB1-ASA1-AA1,195,3
24222.0201 Procedure. (1) Application. A financial institution may apply to
25become certified as a universal bank by filing a written application with the division.
1The application shall include all information required by the division. The
2application shall be on the forms and in accordance with the procedures prescribed
3by the division.
AB1-ASA1-AA1,195,9
4(2) Review by division. An application submitted by a financial institution
5under sub. (1) shall either be approved or disapproved by the division, in writing,
6within 60 days after the date on which application is filed with the division. The
7division and the financial institution may mutually agree to extend the application
8period for an additional period of 60 days. The division shall approve an application
9if all of the applicable requirements under s. 222.0203 (1) are met.
AB1-ASA1-AA1,195,12
10222.0203 Eligibility. (1) Requirements. The division may approve an
11application from a financial institution for certification as a universal bank only if
12all of the following requirements are met:
AB1-ASA1-AA1,195,1513
(a)
The financial institution is chartered or organized, and regulated, under ch.
14214, 215, or 221 and has been in existence and continuous operation for a minimum
15of 3 years before the date of the application.
AB1-ASA1-AA1,195,1616
(b) The financial institution is well-capitalized.
AB1-ASA1-AA1,195,2117
(c) The financial institution does not exhibit a combination of financial,
18managerial, operational, and compliance weaknesses that is moderately severe or
19unsatisfactory, as determined by the division based upon the division's assessment
20of the financial institution's capital adequacy, asset quality, management capability,
21earnings quantity and quality, adequacy of liquidity, and sensitivity to market risk.
AB1-ASA1-AA1,195,2522
(d) During the 12-month period before the date of the application, the financial
23institution has not been the subject of an enforcement action, and there is no
24enforcement action pending against the financial institution by any state or federal
25financial institution regulatory agency, including the division.
AB1-ASA1-AA1,196,5
1(e) The most current evaluation prepared under
12 USC 2906 that the financial
2institution has received rates the financial institution as "outstanding" or
3"satisfactory" in helping to meet the credit needs of its entire community, including
4low-income and moderate-income neighborhoods, consistent with the safe and
5sound operation of the financial institution.
AB1-ASA1-AA1,196,116
(f) If the financial institution has received from its federal functional regulator,
7as defined in
15 USC 6809 (2), a consumer compliance examination that contains
8information regarding the financial institution's compliance with
15 USC 6801 to
96803 and any applicable regulations prescribed under
15 USC 6804, the most recent
10such examination indicates, in the opinion of the division, that the financial
11institution is in substantial compliance with those statutes or regulations.
AB1-ASA1-AA1,196,18
12(2) Failure to maintain eligibility; limitation of authority and
13decertification. For any period during which a universal bank fails to meet the
14requirements under sub. (1), the division shall by order limit or restrict the exercise
15of the powers of the universal bank under this chapter. In addition to or lieu of
16limiting or restricting the universal bank's authority under this subsection, the
17division may by order revoke the universal bank's certificate of authority issued
18under s. 222.0205.
AB1-ASA1-AA1,196,22
19222.0205 Certificate of authority. Upon approval of an application for
20certification as a universal bank, the division shall issue to the applicant a certificate
21of authority stating that the financial institution is certified as a universal bank
22under this chapter.
AB1-ASA1-AA1,197,6
23222.0207 Voluntary termination of certification. A financial institution
24that is certified as a universal bank under this chapter may elect to terminate its
25certification by giving 60 days' prior written notice of the termination to the division.
1A termination under this section is effective only with the written approval of the
2division. A financial institution shall, as a condition to a termination under this
3section, terminate its exercise of all powers granted under this chapter before the
4termination of the certification. The division's written approval of a financial
5institution's termination under this section is void if the financial institution fails to
6satisfy the precondition to termination under this section.
AB1-ASA1-AA1,197,87
SUBCHAPTER III
8
ORGANIZATION
AB1-ASA1-AA1,197,13
9222.0301 Articles of incorporation and bylaws. A universal bank shall
10continue to operate under its articles of incorporation and bylaws as in effect prior
11to certification as a universal bank or as such articles or bylaws may be subsequently
12amended in accordance with the provisions of the chapter under which the universal
13bank was organized or chartered.
AB1-ASA1-AA1,197,20
14222.0303 Name. (1) Use of "bank." Notwithstanding ss. 214.035, 215.40 (1),
15and 215.60 (1) and subject to subs. (2) and (3) (b), a universal bank may use the word
16"bank" in its name, without having to include the word "savings." Notwithstanding
17ss. 215.40 (1) and 215.60 (1) and subject to subs. (2) and (3) (b), a universal bank that
18is organized under ch. 215 and that uses the word "bank" in its name in accordance
19with this section need not include the words "savings and loan association" or
20"savings association" in its name.
AB1-ASA1-AA1,197,23
21(2) Distinguishability. Except as provided in sub. (3), the name of the
22universal bank shall be distinguishable upon the records of the division from all of
23the following names:
AB1-ASA1-AA1,197,2524
(a) The name of every other financial institution organized under the laws of
25this state.
AB1-ASA1-AA1,198,2
1(b) The name of every national bank or foreign bank authorized to transact
2business in this state.
AB1-ASA1-AA1,198,6
3(3) Exceptions. (a) A universal bank may apply to the division for authority
4to use a name that does not meet the requirements under sub. (2). The division may
5authorize the use of the name if any of the conditions under s. 221.0403 (2) (a) or (b)
6is met.
AB1-ASA1-AA1,198,97
(b)
A universal bank may use a name that is used in this state by another
8financial institution or by an institution authorized to transact business in this state,
9if the universal bank has done any of the following:
AB1-ASA1-AA1,198,1010
1. Merged with the other institution.
AB1-ASA1-AA1,198,1111
2. Been formed by reorganization of the other institution.
AB1-ASA1-AA1,198,1312
3. Acquired all or substantially all of the assets, including the name, of the
13other institution.
AB1-ASA1-AA1,198,16
14222.0305 Capital and assets. (1) Capital requirements. Notwithstanding
15subch. VI of ch. 214 and ss. 215.24 and 221.0205, the division shall determine the
16minimum capital requirements of universal banks.
AB1-ASA1-AA1,198,18
17(2) Certain asset requirements. Section 214.045 does not apply to universal
18banks.
AB1-ASA1-AA1,198,25
19222.0307 Acquisitions, mergers, and asset purchases. (1) In general.
20A universal bank may, with the approval of the division, purchase the assets of,
21merge with, acquire, or be acquired by any other financial institution, universal
22bank, national bank, federally chartered savings bank, or savings and loan
23association, or by a holding company of any of these entities. Notwithstanding subch.
24III of ch. 214 and ss. 214.09 and 215.36, the approval of the division of savings and
25loan is not required.
AB1-ASA1-AA1,199,4
1(2) Applications for approval. An application for approval under sub. (1) shall
2be submitted on a form prescribed by the division and accompanied by a fee
3determined by the division. In processing and acting on applications under this
4section the division shall apply the following standards:
AB1-ASA1-AA1,199,65
(a) For universal banks organized under ch. 214, ss. 214.09, 214.62 to 214.64,
6and 214.665, and subch. III of ch. 214.
AB1-ASA1-AA1,199,87
(b) For universal banks organized under ch. 215, ss. 215.35, 215.36, 215.53, and
8215.73.
AB1-ASA1-AA1,199,99
(c) For universal banks chartered under ch. 221, subchs. VII and IX of ch. 221.
AB1-ASA1-AA1,199,1110
SUBCHAPTER IV
11
POWERS
AB1-ASA1-AA1,199,16
12222.0401 Federal financial institution powers. (1) In general. (a)
13Powers exercised by universal bank. A universal bank, with the approval of the
14division, may exercise any power that may be directly exercised by a federally
15chartered savings bank, a federally chartered savings and loan association, or a
16federally chartered national bank.
AB1-ASA1-AA1,199,2117
(b)
Powers exercised by subsidiary of universal bank. A universal bank,
18through a subsidiary and with the approval of the division, may exercise any power
19that a federally chartered savings bank, a federally chartered savings and loan
20association, or a federally chartered national bank may exercise through a
21subsidiary.
AB1-ASA1-AA1,200,4
22(2) Approval required for exercise of federal power. A universal bank shall
23file with the division a written request to exercise a power under sub. (1). The
24division shall determine whether the requested power is permitted under sub. (1).
25Within 60 days after receiving a request under this subsection, the division shall
1approve the request, if the power is permitted under sub. (1), or shall disapprove the
2request if the power is not permitted under sub. (1). The division and the universal
3bank may mutually agree to extend this 60-day period for an additional period of 60
4days.
AB1-ASA1-AA1,200,8
5(3) Exercise of federal powers through a subsidiary. The division may
6require that certain powers exercisable by a universal bank under sub. (1) (a) be
7exercised through a subsidiary of the universal bank with appropriate safeguards to
8limit the risk exposure of the universal bank.
AB1-ASA1-AA1,200,11
9222.0403 Loan powers. (1) Permitted purposes. A universal bank may
10make, sell, purchase, arrange, participate in, invest in, or otherwise deal in loans or
11extensions of credit for any purpose.
AB1-ASA1-AA1,200,17
12(2) In general. Except as provided in subs. (3) to (8), the total liabilities of any
13person, other than a municipal corporation, to a universal bank for a loan or
14extension of credit may not exceed 20% of the capital of the universal bank at any
15time. In determining compliance with this section, liabilities of a partnership
16include the liabilities of the general partners, computed individually as to each
17general partner on the basis of his or her direct liability.
AB1-ASA1-AA1,200,20
18(3) Certain secured liabilities. The percentage limitation under sub. (2) is
1950% of the universal bank's capital, if the liabilities under sub. (2) are limited to the
20following types of liabilities:
AB1-ASA1-AA1,200,2421
(a)
Warehouse receipts. A liability secured by warehouse receipts issued by
22warehouse keepers who are licensed and bonded in this state under ss. 99.02 and
2399.03 or under the federal Bonded Warehouse Act or who hold a registration
24certificate under ch. 127, if all of the following requirements are met:
AB1-ASA1-AA1,200,2525
1. The receipts cover readily marketable nonperishable staples.
AB1-ASA1-AA1,201,1
12. The staples are insured, if it is customary to insure the staples.
AB1-ASA1-AA1,201,32
3. The market value of the staples is not, at any time, less than 140% of the face
3amount of the obligation.
AB1-ASA1-AA1,201,54
(b)
Certain bonds or notes. A liability in the form of a note or bond that meets
5any of the following qualifications:
AB1-ASA1-AA1,201,86
1. The note or bond is secured by not less than a like amount of bonds or notes
7of the United States issued since April 24, 1917, or certificates of indebtedness of the
8United States.
AB1-ASA1-AA1,201,139
2. The note or bond is secured or covered by guarantees or by commitments or
10agreements to take over, or to purchase, the bonds or notes, and the guarantee,
11commitment, or agreement is made by a federal reserve bank, the federal small
12business administration, the federal department of defense, or the federal maritime
13commission.
AB1-ASA1-AA1,201,1514
3. The note or bond is secured by mortgages or trust deeds insured by the
15federal housing administration.
AB1-ASA1-AA1,201,17
16(4) Obligations of local governmental units. (a)
Definition. In this
17subsection, "local governmental unit" has the meaning given in s. 16.97 (7).
AB1-ASA1-AA1,201,2018
(b)
General limitation. Except as otherwise provided in this subsection, the
19total liabilities of a local governmental unit to a universal bank for money borrowed
20may not, at any time, exceed 25% of the capital of the universal bank.
AB1-ASA1-AA1,202,221
(c)
Revenue obligations. Liabilities in the form of revenue obligations of a local
22governmental unit are subject to the limitations provided in par. (b). In addition, a
23universal bank is permitted to invest in a general obligation of that local
24governmental unit in an amount that will bring the combined total of the general
1obligations and revenue obligations of a single local governmental unit to a sum not
2in excess of 50% of the capital of the universal bank.
AB1-ASA1-AA1,202,63
(d)
General obligations. If the liabilities of the local governmental unit are in
4the form of bonds, notes, or other evidences of indebtedness that are a general
5obligation of a local governmental unit, the total liability of the local governmental
6unit may not exceed 50% of the capital of the universal bank.
AB1-ASA1-AA1,202,117
(e)
Temporary borrowings. The total amount of temporary borrowings of any
8local governmental unit maturing within one year after the date of issue may not
9exceed 60% of the capital of the universal bank. Temporary borrowings and
10longer-term general obligation borrowings of a single local governmental unit may
11be considered separately in determining compliance with this subsection.
AB1-ASA1-AA1,202,17
12(5) Obligations of certain international organizations; other foreign bonds.
13A universal bank may purchase bonds offered for sale by the International Bank for
14Reconstruction and Development and the Inter-American Development Bank or
15any other foreign bonds approved under rules established by the division. The
16aggregate investment in any of these bonds issued by a single issuer may not exceed
1710% of the capital of the universal bank.
AB1-ASA1-AA1,202,23
18(6) Foreign national government bonds. A universal bank may purchase
19general obligation bonds issued by any foreign national government if the bonds are
20payable in United States funds. The aggregate investment in these foreign bonds
21may not exceed 3% of the capital of the universal bank, except that this limitation
22does not apply to bonds of the Canadian government and Canadian provinces that
23are payable in United States funds.
AB1-ASA1-AA1,203,6
24(7) Limits established by board. (a)
When financial statements required. A
25universal bank may not make or renew a loan or loans, the aggregate total of which
1exceeds the level established by the board of directors without being supported by a
2signed financial statement of the borrower, unless the loan is secured by collateral
3having a value in excess of the amount of the loan. A signed financial statement
4furnished by the borrower to a universal bank in compliance with this paragraph
5must be renewed annually as long as the loan or any renewal of the loan remains
6unpaid and is subject to this paragraph.
AB1-ASA1-AA1,203,117
(b)
Treatment of loans complying with limits. A loan or a renewal of a loan made
8by a universal bank in compliance with par. (a), without a signed financial statement,
9may be treated by the universal bank as entirely independent of any secured loan
10made to the same borrower if the loan does not exceed the applicable limitations
11provided in this section.
AB1-ASA1-AA1,203,12
12(8) Exceptions. This section does not apply to any of the following:
AB1-ASA1-AA1,203,1613
(a)
Liabilities secured by certain short-term federal obligations. A liability that
14is secured by not less than a like amount of direct obligations of the United States
15which will mature not more than 18 months after the date on which such liabilities
16to the universal bank are entered into.
AB1-ASA1-AA1,203,2017
(b)
Certain federal and state obligations or guaranteed obligations. A liability
18that is a direct obligation of the United States or this state, or an obligation of any
19governmental agency of the United States or this state, that is fully and
20unconditionally guaranteed by the United States or this state.
AB1-ASA1-AA1,203,2221
(c)
Commodity Credit Corporation liabilities. A liability in the form of a note,
22debenture, or certificate of interest of the Commodity Credit Corporation.
AB1-ASA1-AA1,204,223
(d)
Discounting bills of exchange or business or commercial paper. A liability
24created by the discounting of bills of exchange drawn in good faith against actually
1existing values or the discounting of commercial or business paper actually owned
2by the person negotiating the same.
AB1-ASA1-AA1,204,83
(e)
Certain other federal or federally guaranteed obligations. Obligations of, or
4obligations that are fully guaranteed by, the United States and obligations of any
5federal reserve bank, federal home loan bank, the Student Loan Marketing
6Association, the Government National Mortgage Association, the Federal National
7Mortgage Association, the Federal Home Loan Mortgage Corporation, the
8Export-Import Bank of Washington, or the Federal Deposit Insurance Corporation.
AB1-ASA1-AA1,204,23
9(9) Additional authority. (a)
In general. In addition to the authority
10granted under subs. (1) to (8), and except as provided in par. (b), a universal bank may
11lend under this subsection, through the universal bank or subsidiary of the universal
12bank, to all borrowers from the universal bank and all of its subsidiaries, an
13aggregate amount not to exceed 20% of the universal bank's capital. Neither a
14universal bank nor any subsidiary of the universal bank may lend to any borrower,
15under this subsection and any other law or rule, an amount that would result in an
16aggregate amount for all loans to that borrower that exceeds 20% of the universal
17bank's capital. A universal bank or its subsidiary may take an equity position or
18other form of interest as security in a project funded through loans made under this
19paragraph. Every transaction by a universal bank or its subsidiary under this
20paragraph requires prior approval by the governing board of the universal bank or
21its subsidiary, respectively. Loans made under this paragraph are not subject to s.
22221.0326 or to classification as losses, for a period of 2 years from the date of each loan
23except as provided in par. (b).
AB1-ASA1-AA1,205,524
(b)
Suspension of additional authority. The division may suspend authority
25established under par. (a) and, in such case, may specify how an outstanding loan
1shall be treated by the universal bank or its subsidiary. Among the factors that the
2division may consider in suspending authority under par. (a) are the universal bank's
3capital adequacy, asset quality, earnings quantity, earnings quality, adequacy of
4liquidity, and sensitivity to market risk and the ability of the universal bank's
5management.
AB1-ASA1-AA1,205,10
6(10) Exercise of loan powers; prohibited considerations. In determining
7whether to make a loan or extension of credit, no universal bank may consider any
8health information obtained from the records of an affiliate of the universal bank
9that is engaged in the business of insurance, unless the person to whom the health
10information relates consents.
AB1-ASA1-AA1,205,18
11222.0405 Investment powers. (1) Investment securities. Except as
12provided in subs. (3) to (8), a universal bank may purchase, sell, underwrite, and hold
13investment securities, consistent with safe and sound banking practices, up to 100%
14of the universal bank's capital. A universal bank may not invest greater than 20%
15of the universal bank's capital in the investment securities of one obligor or issuer.
16In this subsection, "investment securities" includes commercial paper, banker's
17acceptances, marketable securities in the form of bonds, notes, debentures, and
18similar instruments that are regarded as investment securities.
AB1-ASA1-AA1,205,22
19(2) Equity securities. Except as provided in subs. (3) to (8), a universal bank
20may purchase, sell, underwrite, and hold equity securities, consistent with safe and
21sound banking practices, up to 20% of capital or, if approved by the division in
22writing, a greater percentage of capital.
AB1-ASA1-AA1,206,11
23(3) Housing activities. With the prior written consent of the division, a
24universal bank may invest in the initial purchase and development, or the purchase
25or commitment to purchase after completion, of home sites and housing for sale or
1rental, including projects for the reconstruction, rehabilitation, or rebuilding of
2residential properties to meet the minimum standards of health and occupancy
3prescribed for a local governmental unit, the provision of accommodations for retail
4stores, shops, and other community services that are reasonably incident to that
5housing, or in the stock of a corporation that owns one or more of those projects and
6that is wholly owned by one or more financial institutions. The total investment in
7any one project may not exceed 15% of the universal bank's capital, nor may the
8aggregate investment under this subsection exceed 50% of capital. A universal bank
9may not make an investment under this subsection unless it is in compliance with
10the capital requirements set by the division under s. 222.0305 (1)
and with the capital
11maintenance requirements of its deposit insurance corporation.
AB1-ASA1-AA1,206,23
12(4) Profit-participation projects. A universal bank may take equity positions
13in profit-participation projects, including projects funded through loans from the
14universal bank, in an aggregate amount not to exceed 20% of capital. The division
15may suspend the investment authority under this subsection. If the division
16suspends the investment authority under this subsection, the division may specify
17how outstanding investments under this subsection shall be treated by the universal
18bank or its subsidiary. Among the factors that the division may consider in
19suspending authority under this subsection are the universal bank's capital
20adequacy, asset quality, earnings quantity, earnings quality, adequacy of liquidity,
21and sensitivity to market risk and the ability of the universal bank's management.
22This subsection does not authorize a universal bank, directly or indirectly through
23a subsidiary, to engage in the business of underwriting insurance.
AB1-ASA1-AA1,207,3
1(5) Debt investments. A universal bank may invest in bonds, notes,
2obligations, and liabilities described under s. 222.0403 (3) to (7), subject to the
3limitations under those subsections.
AB1-ASA1-AA1,207,5
4(6) Certain liabilities. This section does not limit investment in the
5liabilities described in s. 222.0403 (8).
AB1-ASA1-AA1,207,7
6(7) Certain investments. A universal bank may invest without limitation in
7any of the following:
AB1-ASA1-AA1,207,108
(a)
Business development corporations. Stocks or obligations of a corporation
9organized for business development by this state or by the United States or by an
10agency of this state or the United States.
AB1-ASA1-AA1,207,1211
(b)
Urban renewal investment corporations. Obligations of an urban renewal
12investment corporation organized under the laws of this state or of the United States.