SB55-ASA1-AA1,1083,1511
(b)
Powers exercised by subsidiary of universal bank. A universal bank,
12through a subsidiary and with the approval of the division, may exercise any power
13that a federally chartered savings bank, a federally chartered savings and loan
14association, or a federally chartered national bank may exercise through a
15subsidiary.
SB55-ASA1-AA1,1083,23
16(2) Approval required for exercise of federal power. A universal bank shall
17file with the division a written request to exercise a power under sub. (1). The
18division shall determine whether the requested power is permitted under sub. (1).
19Within 60 days after receiving a request under this subsection, the division shall
20approve the request, if the power is permitted under sub. (1), or shall disapprove the
21request if the power is not permitted under sub. (1). The division and the universal
22bank may mutually agree to extend this 60-day period for an additional period of 60
23days.
SB55-ASA1-AA1,1084,2
24(3) Exercise of federal powers through a subsidiary. The division may
25require that certain powers exercisable by a universal bank under sub. (1) (a) be
1exercised through a subsidiary of the universal bank with appropriate safeguards to
2limit the risk exposure of the universal bank.
SB55-ASA1-AA1,1084,5
3222.0403 Loan powers. (1) Permitted purposes. A universal bank may
4make, sell, purchase, arrange, participate in, invest in, or otherwise deal in loans or
5extensions of credit for any purpose.
SB55-ASA1-AA1,1084,11
6(2) In general. Except as provided in subs. (3) to (8), the total liabilities of any
7person, other than a municipal corporation, to a universal bank for a loan or
8extension of credit may not exceed 20% of the capital of the universal bank at any
9time. In determining compliance with this section, liabilities of a partnership
10include the liabilities of the general partners, computed individually as to each
11general partner on the basis of his or her direct liability.
SB55-ASA1-AA1,1084,14
12(3) Certain secured liabilities. The percentage limitation under sub. (2) is
1350% of the universal bank's capital, if the liabilities under sub. (2) are limited to the
14following types of liabilities:
SB55-ASA1-AA1,1084,1815
(a)
Warehouse receipts. A liability secured by warehouse receipts issued by
16warehouse keepers who are licensed and bonded in this state under ss. 99.02 and
1799.03 or under the federal Bonded Warehouse Act or who hold a registration
18certificate under ch. 127, if all of the following requirements are met:
SB55-ASA1-AA1,1084,1919
1. The receipts cover readily marketable nonperishable staples.
SB55-ASA1-AA1,1084,2020
2. The staples are insured, if it is customary to insure the staples.
SB55-ASA1-AA1,1084,2221
3. The market value of the staples is not, at any time, less than 140% of the face
22amount of the obligation.
SB55-ASA1-AA1,1084,2423
(b)
Certain bonds or notes. A liability in the form of a note or bond that meets
24any of the following qualifications:
SB55-ASA1-AA1,1085,3
11. The note or bond is secured by not less than a like amount of bonds or notes
2of the United States issued since April 24, 1917, or certificates of indebtedness of the
3United States.
SB55-ASA1-AA1,1085,84
2. The note or bond is secured or covered by guarantees or by commitments or
5agreements to take over, or to purchase, the bonds or notes, and the guarantee,
6commitment, or agreement is made by a federal reserve bank, the federal small
7business administration, the federal department of defense, or the federal maritime
8commission.
SB55-ASA1-AA1,1085,109
3. The note or bond is secured by mortgages or trust deeds insured by the
10federal housing administration.
SB55-ASA1-AA1,1085,12
11(4) Obligations of local governmental units. (a)
Definition. In this
12subsection, "local governmental unit" has the meaning given in s. 22.01 (7).
SB55-ASA1-AA1,1085,1513
(b)
General limitation. Except as otherwise provided in this subsection, the
14total liabilities of a local governmental unit to a universal bank for money borrowed
15may not, at any time, exceed 25% of the capital of the universal bank.
SB55-ASA1-AA1,1085,2116
(c)
Revenue obligations. Liabilities in the form of revenue obligations of a local
17governmental unit are subject to the limitations provided in par. (b). In addition, a
18universal bank is permitted to invest in a general obligation of that local
19governmental unit in an amount that will bring the combined total of the general
20obligations and revenue obligations of a single local governmental unit to a sum not
21in excess of 50% of the capital of the universal bank.
SB55-ASA1-AA1,1085,2522
(d)
General obligations. If the liabilities of the local governmental unit are in
23the form of bonds, notes, or other evidences of indebtedness that are a general
24obligation of a local governmental unit, the total liability of the local governmental
25unit may not exceed 50% of the capital of the universal bank.
SB55-ASA1-AA1,1086,5
1(e)
Temporary borrowings. The total amount of temporary borrowings of any
2local governmental unit maturing within one year after the date of issue may not
3exceed 60% of the capital of the universal bank. Temporary borrowings and
4longer-term general obligation borrowings of a single local governmental unit may
5be considered separately in determining compliance with this subsection.
SB55-ASA1-AA1,1086,11
6(5) Obligations of certain international organizations; other foreign bonds.
7A universal bank may purchase bonds offered for sale by the International Bank for
8Reconstruction and Development and the Inter-American Development Bank or
9any other foreign bonds approved under rules established by the division. The
10aggregate investment in any of these bonds issued by a single issuer may not exceed
1110% of the capital of the universal bank.
SB55-ASA1-AA1,1086,17
12(6) Foreign national government bonds. A universal bank may purchase
13general obligation bonds issued by any foreign national government if the bonds are
14payable in United States funds. The aggregate investment in these foreign bonds
15may not exceed 3% of the capital of the universal bank, except that this limitation
16does not apply to bonds of the Canadian government and Canadian provinces that
17are payable in United States funds.
SB55-ASA1-AA1,1086,25
18(7) Limits established by board. (a)
When financial statements required. A
19universal bank may not make or renew a loan or loans, the aggregate total of which
20exceeds the level established by the board of directors without being supported by a
21signed financial statement of the borrower, unless the loan is secured by collateral
22having a value in excess of the amount of the loan. A signed financial statement
23furnished by the borrower to a universal bank in compliance with this paragraph
24must be renewed annually as long as the loan or any renewal of the loan remains
25unpaid and is subject to this paragraph.
SB55-ASA1-AA1,1087,5
1(b)
Treatment of loans complying with limits. A loan or a renewal of a loan made
2by a universal bank in compliance with par. (a), without a signed financial statement,
3may be treated by the universal bank as entirely independent of any secured loan
4made to the same borrower if the loan does not exceed the applicable limitations
5provided in this section.
SB55-ASA1-AA1,1087,6
6(8) Exceptions. This section does not apply to any of the following:
SB55-ASA1-AA1,1087,107
(a)
Liabilities secured by certain short-term federal obligations. A liability that
8is secured by not less than a like amount of direct obligations of the United States
9which will mature not more than 18 months after the date on which such liabilities
10to the universal bank are entered into.
SB55-ASA1-AA1,1087,1411
(b)
Certain federal and state obligations or guaranteed obligations. A liability
12that is a direct obligation of the United States or this state, or an obligation of any
13governmental agency of the United States or this state, that is fully and
14unconditionally guaranteed by the United States or this state.
SB55-ASA1-AA1,1087,1615
(c)
Commodity Credit Corporation liabilities. A liability in the form of a note,
16debenture, or certificate of interest of the Commodity Credit Corporation.
SB55-ASA1-AA1,1087,2017
(d)
Discounting bills of exchange or business or commercial paper. A liability
18created by the discounting of bills of exchange drawn in good faith against actually
19existing values or the discounting of commercial or business paper actually owned
20by the person negotiating the same.
SB55-ASA1-AA1,1088,221
(e)
Certain other federal or federally guaranteed obligations. Obligations of, or
22obligations that are fully guaranteed by, the United States and obligations of any
23federal reserve bank, federal home loan bank, the Student Loan Marketing
24Association, the Government National Mortgage Association, the Federal National
1Mortgage Association, the Federal Home Loan Mortgage Corporation, the
2Export-Import Bank of Washington, or the Federal Deposit Insurance Corporation.
SB55-ASA1-AA1,1088,17
3(9) Additional authority. (a)
In general. In addition to the authority
4granted under subs. (1) to (8), and except as provided in par. (b), a universal bank may
5lend under this subsection, through the universal bank or subsidiary of the universal
6bank, to all borrowers from the universal bank and all of its subsidiaries, an
7aggregate amount not to exceed 20% of the universal bank's capital. Neither a
8universal bank nor any subsidiary of the universal bank may lend to any borrower,
9under this subsection and any other law or rule, an amount that would result in an
10aggregate amount for all loans to that borrower that exceeds 20% of the universal
11bank's capital. A universal bank or its subsidiary may take an equity position or
12other form of interest as security in a project funded through loans made under this
13paragraph. Every transaction by a universal bank or its subsidiary under this
14paragraph requires prior approval by the governing board of the universal bank or
15its subsidiary, respectively. Loans made under this paragraph are not subject to s.
16221.0326 or to classification as losses, for a period of 2 years from the date of each loan
17except as provided in par. (b).
SB55-ASA1-AA1,1088,2418
(b)
Suspension of additional authority. The division may suspend authority
19established under par. (a) and, in such case, may specify how an outstanding loan
20shall be treated by the universal bank or its subsidiary. Among the factors that the
21division may consider in suspending authority under par. (a) are the universal bank's
22capital adequacy, asset quality, earnings quantity, earnings quality, adequacy of
23liquidity, and sensitivity to market risk and the ability of the universal bank's
24management.
SB55-ASA1-AA1,1089,5
1(10) Exercise of loan powers; prohibited considerations. In determining
2whether to make a loan or extension of credit, no universal bank may consider any
3health information obtained from the records of an affiliate of the universal bank
4that is engaged in the business of insurance, unless the person to whom the health
5information relates consents.
SB55-ASA1-AA1,1089,13
6222.0405 Investment powers. (1) Investment securities. Except as
7provided in subs. (3) to (8), a universal bank may purchase, sell, underwrite, and hold
8investment securities, consistent with safe and sound banking practices, up to 100%
9of the universal bank's capital. A universal bank may not invest greater than 20%
10of the universal bank's capital in the investment securities of one obligor or issuer.
11In this subsection, "investment securities" includes commercial paper, banker's
12acceptances, marketable securities in the form of bonds, notes, debentures, and
13similar instruments that are regarded as investment securities.
SB55-ASA1-AA1,1089,17
14(2) Equity securities. Except as provided in subs. (3) to (8), a universal bank
15may purchase, sell, underwrite, and hold equity securities, consistent with safe and
16sound banking practices, up to 20% of capital or, if approved by the division in
17writing, a greater percentage of capital.
SB55-ASA1-AA1,1090,6
18(3) Housing activities. With the prior written consent of the division, a
19universal bank may invest in the initial purchase and development, or the purchase
20or commitment to purchase after completion, of home sites and housing for sale or
21rental, including projects for the reconstruction, rehabilitation, or rebuilding of
22residential properties to meet the minimum standards of health and occupancy
23prescribed for a local governmental unit, the provision of accommodations for retail
24stores, shops, and other community services that are reasonably incident to that
25housing, or in the stock of a corporation that owns one or more of those projects and
1that is wholly owned by one or more financial institutions. The total investment in
2any one project may not exceed 15% of the universal bank's capital, nor may the
3aggregate investment under this subsection exceed 50% of capital. A universal bank
4may not make an investment under this subsection unless it is in compliance with
5the capital requirements set by the division under s. 222.0305 (1)
and with the capital
6maintenance requirements of its deposit insurance corporation.
SB55-ASA1-AA1,1090,18
7(4) Profit-participation projects. A universal bank may take equity positions
8in profit-participation projects, including projects funded through loans from the
9universal bank, in an aggregate amount not to exceed 20% of capital. The division
10may suspend the investment authority under this subsection. If the division
11suspends the investment authority under this subsection, the division may specify
12how outstanding investments under this subsection shall be treated by the universal
13bank or its subsidiary. Among the factors that the division may consider in
14suspending authority under this subsection are the universal bank's capital
15adequacy, asset quality, earnings quantity, earnings quality, adequacy of liquidity,
16and sensitivity to market risk and the ability of the universal bank's management.
17This subsection does not authorize a universal bank, directly or indirectly through
18a subsidiary, to engage in the business of underwriting insurance.
SB55-ASA1-AA1,1090,21
19(5) Debt investments. A universal bank may invest in bonds, notes,
20obligations, and liabilities described under s. 222.0403 (3) to (7), subject to the
21limitations under those subsections.
SB55-ASA1-AA1,1090,23
22(6) Certain liabilities. This section does not limit investment in the
23liabilities described in s. 222.0403 (8).
SB55-ASA1-AA1,1090,25
24(7) Certain investments. A universal bank may invest without limitation in
25any of the following:
SB55-ASA1-AA1,1091,3
1(a)
Business development corporations. Stocks or obligations of a corporation
2organized for business development by this state or by the United States or by an
3agency of this state or the United States.
SB55-ASA1-AA1,1091,54
(b)
Urban renewal investment corporations. Obligations of an urban renewal
5investment corporation organized under the laws of this state or of the United States.
SB55-ASA1-AA1,1091,106
(c)
Certain bank insurance companies. An equity interest in an insurance
7company or an insurance holding company organized to provide insurance for
8universal banks and for persons affiliated with universal banks, solely to the extent
9that this ownership is a prerequisite to obtaining directors' and officers' insurance
10or blanket bond insurance for the universal bank through the company.
SB55-ASA1-AA1,1091,1411
(d)
Certain remote service unit corporations. Shares of stock, whether
12purchased or otherwise acquired, in a corporation acquiring, placing, and operating
13remote service units under s. 214.04 (21) or 215.13 (46) or bank communications
14terminals under s. 221.0303 (2).
SB55-ASA1-AA1,1091,1615
(e)
Service corporations. Equity or debt securities or instruments of a service
16corporation subsidiary of the universal bank.
SB55-ASA1-AA1,1091,1717
(f)
Federal funds. Advances of federal funds.
SB55-ASA1-AA1,1091,2118
(g)
Certain risk management financial products. With the prior written
19approval of the division, financial futures transactions, financial options
20transactions, forward commitments, or other financial products for the purpose of
21reducing, hedging, or otherwise managing its interest rate risk exposure.
SB55-ASA1-AA1,1091,2322
(h)
Certain fiduciaries. A subsidiary organized to exercise corporate fiduciary
23powers under ch. 112.
SB55-ASA1-AA1,1092,224
(i)
Agricultural credit corporations. An agricultural credit corporation. Unless
25a universal bank owns at least 80% of the stock of the agricultural credit corporation,
1a universal bank may not invest more than 20% of the universal bank's capital in the
2agricultural credit corporation.
SB55-ASA1-AA1,1092,53
(j)
Deposit accounts and insured obligations. Deposit accounts or insured
4obligations of any financial institution, the accounts of which are insured by a deposit
5insurance corporation.
SB55-ASA1-AA1,1092,116
(k)
Certain federal obligations. Obligations of, or obligations that are fully
7guaranteed by, the United States and stocks or obligations of any federal reserve
8bank, federal home loan bank, the Student Loan Marketing Association, the
9Government National Mortgage Association, the Federal National Mortgage
10Association, the Federal Home Loan Mortgage Corporation, or the Federal Deposit
11Insurance Corporation.
SB55-ASA1-AA1,1092,1212
(L)
Other investments. Any other investment authorized by the division.
SB55-ASA1-AA1,1092,15
13(8) Investments in other financial institutions. In addition to the authority
14granted under ss. 222.0307 and 222.0409, and subject to the limitations of sub. (2),
15a universal bank may invest in other financial institutions.
SB55-ASA1-AA1,1092,19
16(9) Investments through subsidiaries. A universal bank may make
17investments under this section, directly or indirectly through a subsidiary, unless
18the division determines that an investment shall be made through a subsidiary with
19appropriate safeguards to limit the risk exposure of the universal bank.
SB55-ASA1-AA1,1092,22
20222.0407 Universal bank purchase of its own stock. (1) In general. A
21universal bank may hold or purchase not more than 10% of its capital stock, notes,
22or debentures, except as provided in sub. (2) or (3).
SB55-ASA1-AA1,1092,24
23(2) Division approval. A universal bank may hold or purchase more than 10%
24of its capital stock, notes, or debentures, if approved by the division.
SB55-ASA1-AA1,1093,12
1(3) Additional authority. A universal bank may hold or purchase more than
210% of its capital stock, notes, or debentures if the purchase is necessary to prevent
3loss upon a debt previously contracted in good faith. Stock, notes, or debentures held
4or purchased under this subsection may not be held by the universal bank for more
5than 6 months if the stock, notes, or debentures can be sold for the amount of the
6claim of the universal bank against the holder of the debt previously contracted. The
7universal bank shall either sell the stock, notes, or debentures within 12 months of
8acquisition under this subsection or shall cancel the stock, notes, or debentures.
9Cancellation of the stock, notes, or debentures reduces the amount of the universal
10bank's capital stock, notes, or debentures. If the reduction reduces the universal
11bank's capital below the minimum level required by the division, the universal bank
12shall increase its capital to the amount required by the division.
SB55-ASA1-AA1,1093,18
13(4) Loans secured by capital, surplus, or deposits. A universal bank may not
14loan any part of its capital, surplus, or deposits on its own capital stock, notes, or
15debentures as collateral security, except that a universal bank may make a loan
16secured by its own capital stock, notes, or debentures to the same extent that the
17universal bank may make a loan secured by the capital stock, notes, and debentures
18of a holding company for the universal bank.
SB55-ASA1-AA1,1093,23
19222.0409 Stock in bank-owned banks. With the approval of the division,
20a universal bank may acquire and hold stock in one or more banks chartered under
21s. 221.1202 or national banks chartered under
12 USC 27 (b) or in one or more
22holding companies wholly owning such a bank. Aggregate investments under this
23section may not exceed 10% of the universal bank's capital.
SB55-ASA1-AA1,1094,3
24222.0411 General deposit powers. (1) In general. A universal bank may
25set eligibility requirements for, and establish the types and terms of, deposits that
1the universal bank solicits and accepts. The terms set under this subsection may
2include minimum and maximum amounts that the universal bank may accept and
3the frequency and computation method of paying interest.
SB55-ASA1-AA1,1094,6
4(2) Pledge of security for deposits. Subject to the limitations of s. 221.0324
5that are applicable to banks, a universal bank may pledge its assets as security for
6deposits.
SB55-ASA1-AA1,1094,9
7(3) Securitization of assets. With the approval of the division, a universal
8bank may securitize its assets for sale to the public. The division may establish
9procedures governing the exercise of authority granted under this subsection.
SB55-ASA1-AA1,1094,23
10(4) Safe deposit powers. A universal bank may take and receive, from any
11individual or corporation for safekeeping and storage, gold and silver plate, jewelry,
12money, stocks, securities, and other valuables or personal property, and may rent out
13the use of safes or other receptacles upon its premises for such compensation as may
14be agreed upon. A universal bank has a lien for its charges on any property taken
15or received by it for safekeeping. If the lien is not paid within 2 years from the date
16the lien accrues, or if property is not called for by the person depositing the property,
17or by his or her representative or assignee, within 2 years from the date the lien
18accrues, the universal bank may sell the property at public auction. A universal bank
19shall provide the same notice for a sale under this subsection that is required by law
20for sales of personal property on execution. After retaining from the proceeds of the
21sale all of the liens and charges due the bank and the reasonable expenses of the sale,
22the universal bank shall pay the balance to the person depositing the property, or to
23his or her representative or assignee.
SB55-ASA1-AA1,1095,4
24222.0413 Necessary or convenient powers, reasonably related or
25incidental activities, and other approved activities. (1) Necessary or
1convenient powers. Unless otherwise prohibited or limited by this chapter, a
2universal bank may exercise all powers necessary or convenient to effect the
3purposes for which the universal bank is organized or to further the businesses in
4which the universal bank is lawfully engaged.
SB55-ASA1-AA1,1095,14
5(2) Reasonably related and incidental activities. (a)
Subject to any
6applicable state or federal regulatory or licensing requirements, a universal bank
7may engage, directly or indirectly through a subsidiary, in activities reasonably
8related or incident to the purposes of the universal bank. Activities reasonably
9related or incident to the purposes of the universal bank are those activities that are
10part of the business of financial institutions, or closely related to the business of
11financial institutions, or convenient and useful to the business of financial
12institutions, or reasonably related or incident to the operation of financial
13institutions, or financial in nature. Activities that are reasonably related or incident
14to the purposes of a universal bank include the following:
SB55-ASA1-AA1,1095,1515
1. Business and professional services.
SB55-ASA1-AA1,1095,1616
2. Data processing.
SB55-ASA1-AA1,1095,1717
3. Courier and messenger services.
SB55-ASA1-AA1,1095,1818
4. Credit-related activities.
SB55-ASA1-AA1,1095,1919
5. Consumer services.
SB55-ASA1-AA1,1095,2020
6. Real estate-related services, including real estate brokerage services.
SB55-ASA1-AA1,1095,2121
7. Insurance and related services, other than insurance underwriting.
SB55-ASA1-AA1,1095,2222
8. Securities brokerage.
SB55-ASA1-AA1,1095,2323
9. Investment advice.
SB55-ASA1-AA1,1095,2424
10. Securities and bond underwriting.
SB55-ASA1-AA1,1095,2525
11. Mutual fund activities.
SB55-ASA1-AA1,1096,1
112. Financial consulting.
SB55-ASA1-AA1,1096,22
13. Tax planning and preparation.
SB55-ASA1-AA1,1096,33
14. Community development and charitable activities.
SB55-ASA1-AA1,1096,44
15. Debt cancellation contracts.
SB55-ASA1-AA1,1096,65
16. Any activities that are reasonably related or incident to activities under
6subds. 1. to 15., as determined by rule of the division under par. (b).
SB55-ASA1-AA1,1096,167
(b) An activity that is authorized by statute or regulation for financial
8institutions to engage in as of the effective date of this paragraph .... [revisor inserts
9date], is an activity that is reasonably related to or incident to the purposes of a
10universal bank. An activity permitted under the Bank Holding Company Act is an
11activity that is reasonably related to or incident to the purposes of a universal bank.
12The division may, by rule, expand the list of activities under par. (a) 1. to 15. that are
13reasonably related or incident to the purposes of a universal bank and, by rule, may
14establish which activities under par. (a) 16. are reasonably related or incident to the
15activities under par. (a) 1. to 15. Any activity approved by rule of the division under
16this paragraph shall be authorized for all universal banks.
SB55-ASA1-AA1,1096,19
17(3) Notice requirement. A universal bank shall give 60 days' prior written
18notice to the division of the universal bank's intention to engage in an activity under
19this section.
SB55-ASA1-AA1,1097,2
20(4) Standards for denial. The division may deny the authority of a universal
21bank to engage in an activity under this section, other than those activities described
22in sub. (2) (a) 1. to 15., if the division determines that the activity is not an activity
23reasonably related or incident to the purposes of a universal bank. The division may
24deny the authority of a universal bank to engage in an activity under this section if
25the division determines that the universal bank is not well-capitalized, that the
1universal bank is the subject of an enforcement action, or that the universal bank
2does not have satisfactory management expertise for the proposed activity.
SB55-ASA1-AA1,1097,6
3(5) Insurance intermediation. A universal bank, or an officer or salaried
4employee of a universal bank, may obtain a license as an insurance intermediary, if
5otherwise qualified. A universal bank may not, directly or indirectly through a
6subsidiary, engage in the business of underwriting insurance.
SB55-ASA1-AA1,1097,8
7(6) Other activities approved by the division. A universal bank may engage
8in any other activity that is approved by rule of the division.
SB55-ASA1-AA1,1097,12
9(7) Activities provided through a subsidiary. A universal bank may engage
10in an activity under this section, directly or indirectly through a subsidiary, unless
11the division determines that the activity must be conducted through a subsidiary
12with appropriate safeguards to limit the risk exposure of the universal bank.
SB55-ASA1-AA1,1097,18
13(8) Limitations on investments through subsidiaries. The amount of the
14investment in any one subsidiary that engages in an activity under this section may
15not exceed 20% of capital or, if approved by the division, a higher percentage
16authorized by the division. The aggregate investment in all subsidiaries that engage
17in an activity under this subsection may not exceed 50% of capital or, if approved by
18the division, a higher percentage authorized by the division.
SB55-ASA1-AA1,1097,21
19(9) Ownership of subsidiaries. A subsidiary that engages in an activity under
20this section may be owned jointly, with one or more other financial institutions,
21individuals, or entities.
SB55-ASA1-AA1,1097,23
22222.0415 Trust powers. Subject to rules of the division, a universal bank may
23exercise trust powers in accordance with s. 221.0316.".