AB2,38,6
17(9) Additional authority. (a)
In general. In addition to the authority
18granted under subs. (1) to (8), and except as provided in par. (b), a universal bank may
19lend under this subsection, through the universal bank or subsidiary of the universal
20bank, to all borrowers from the universal bank and all of its subsidiaries, an
21aggregate amount not to exceed 20% of the universal bank's capital. Except as
22provided in subs. (3) and (4), neither a universal bank nor any subsidiary of the
23universal bank may lend to any borrower, under this subsection or any other law or
24rule, an amount that would result in an aggregate amount for all loans to that
25borrower that exceeds 20% of the universal bank's capital. A universal bank or its
1subsidiary may take an equity position or other form of interest as security in a
2project funded through loans made under this paragraph. Every transaction by a
3universal bank or its subsidiary under this paragraph requires prior approval by the
4governing board of the universal bank or its subsidiary, respectively. Loans made
5under this paragraph are not subject to s. 221.0326 or to classification as losses, for
6a period of 2 years from the date of each loan except as provided in par. (b).
AB2,38,137
(b)
Suspension of additional authority. The division may suspend the authority
8established under par. (a) and, in such case, may specify how an outstanding loan
9shall be treated by the universal bank or its subsidiary. Among the factors that the
10division may consider in suspending authority under par. (a) are the universal bank's
11capital adequacy, asset quality, earnings quantity, earnings quality, adequacy of
12liquidity, and sensitivity to market risk and the ability of the universal bank's
13management.
AB2,38,18
14(10) Exercise of loan powers; prohibited considerations. In determining
15whether to make a loan or extension of credit, no universal bank may consider any
16health information obtained from the records of an affiliate of the universal bank
17that is engaged in the business of insurance, unless the person to whom the health
18information relates consents.
AB2,39,2
19222.0405 Investment powers. (1) Investment securities. Except as
20provided in subs. (3) to (8), a universal bank may purchase, sell, underwrite, and hold
21investment securities, consistent with safe and sound banking practices, up to 100%
22of the universal bank's capital. A universal bank may not invest greater than 20%
23of the universal bank's capital in the investment securities of one obligor or issuer.
24In this subsection, "investment securities" includes commercial paper, banker's
1acceptances, marketable securities in the form of bonds, notes, debentures, and
2similar instruments that are regarded as investment securities.
AB2,39,6
3(2) Equity securities. Except as provided in subs. (3) to (8), a universal bank
4may purchase, sell, underwrite, and hold equity securities, consistent with safe and
5sound banking practices, up to 20% of the universal bank's capital or, if approved by
6the division in writing, a greater percentage of the universal bank's capital.
AB2,39,21
7(3) Housing activities. With the prior written consent of the division, a
8universal bank may invest in the initial purchase and development, or the purchase
9or commitment to purchase after completion, of home sites and housing for sale or
10rental, including projects for the reconstruction, rehabilitation, or rebuilding of
11residential properties to meet the minimum standards of health and occupancy
12prescribed for a local governmental unit, the provision of accommodations for retail
13stores, shops, and other community services that are reasonably incident to that
14housing, or the stock of a corporation that owns one or more of those projects and that
15is wholly owned by one or more financial institutions. The total investment in any
16one project may not exceed 15% of the universal bank's capital, nor may the
17aggregate investment under this subsection exceed 50% of the universal bank's
18capital. A universal bank may not make an investment under this subsection unless
19it is in compliance with the capital requirements set by the division under s. 222.0305
20(1) and with the capital maintenance requirements of its deposit insurance
21corporation.
AB2,40,8
22(4) Profit-participation projects. A universal bank may take equity positions
23in profit-participation projects, including projects funded through loans from the
24universal bank, in an aggregate amount not to exceed 20% of the universal bank's
25capital. The division may suspend the investment authority under this subsection.
1If the division suspends the investment authority under this subsection, the division
2may specify how outstanding investments under this subsection shall be treated by
3the universal bank or its subsidiary. Among the factors that the division may
4consider in suspending authority under this subsection are the universal bank's
5capital adequacy, asset quality, earnings quantity, earnings quality, adequacy of
6liquidity, sensitivity to market risk, and the ability of the universal bank's
7management. This subsection does not authorize a universal bank, directly or
8indirectly through a subsidiary, to engage in the business of underwriting insurance.
AB2,40,11
9(5) Debt investments. A universal bank may invest in bonds, notes,
10obligations, and liabilities described under s. 222.0403 (3) to (7), subject to the
11limitations under those subsections.
AB2,40,13
12(6) Certain liabilities. This section does not limit investment in the
13liabilities described in s. 222.0403 (8).
AB2,40,15
14(7) Certain investments. A universal bank may invest without limitation in
15any of the following:
AB2,40,1816
(a)
Business development corporations. Stocks or obligations of a corporation
17organized for business development by this state or by the United States or by an
18agency of this state or the United States.
AB2,40,2019
(b)
Urban renewal investment corporations. Obligations of an urban renewal
20investment corporation organized under the laws of this state or of the United States.
AB2,40,2521
(c)
Certain bank insurance companies. An equity interest in an insurance
22company or an insurance holding company organized to provide insurance for
23universal banks and for persons affiliated with universal banks, solely to the extent
24that this ownership is a prerequisite to obtaining directors' and officers' insurance
25or blanket bond insurance for the universal bank through the company.
AB2,41,4
1(d)
Certain remote service unit corporations. Shares of stock, whether
2purchased or otherwise acquired, in a corporation acquiring, placing, and operating
3remote service units under s. 214.04 (21) or 215.13 (46) or bank communications
4terminals under s. 221.0303 (2).
AB2,41,65
(e)
Service corporations. Equity or debt securities or instruments of a service
6corporation subsidiary of the universal bank.
AB2,41,77
(f)
Federal funds. Advances of federal funds.
AB2,41,118
(g)
Certain risk management financial products. With the prior written
9approval of the division, financial futures transactions, financial options
10transactions, forward commitments, or other financial products for the purpose of
11reducing, hedging, or otherwise managing its interest rate risk exposure.
AB2,41,1312
(h)
Certain fiduciaries. A subsidiary organized to exercise corporate fiduciary
13powers under ch. 112.
AB2,41,1714
(i)
Agricultural credit corporations. An agricultural credit corporation, except
15that if the universal bank owns less than 80% of the stock of the agricultural credit
16corporation, the universal bank may not invest more than 20% of the universal
17bank's capital in the agricultural credit corporation.
AB2,41,2018
(j)
Deposit accounts and insured obligations. Deposit accounts or insured
19obligations of any financial institution, the accounts of which are insured by a deposit
20insurance corporation.
AB2,42,221
(k)
Certain federal obligations. Obligations of, or obligations that are fully
22guaranteed by, the United States and stocks or obligations of any federal reserve
23bank, federal home loan bank, the Student Loan Marketing Association, the
24Government National Mortgage Association, the Federal National Mortgage
1Association, the Federal Home Loan Mortgage Corporation, or the Federal Deposit
2Insurance Corporation.
AB2,42,33
(L)
Other investments. Any other investment authorized by the division.
AB2,42,6
4(8) Investments in other financial institutions. In addition to the authority
5granted under ss. 222.0307 and 222.0409, and subject to the limitations of sub. (2),
6a universal bank may invest in other financial institutions.
AB2,42,10
7(9) Investments through subsidiaries. A universal bank may make
8investments under this section, directly or indirectly through a subsidiary, unless
9the division determines that an investment shall be made through a subsidiary with
10appropriate safeguards to limit the risk exposure of the universal bank.
AB2,42,13
11222.0407 Universal bank purchase of its own stock. (1) In general. A
12universal bank may hold or purchase not more than 10% of its capital stock, notes,
13or debentures, except as provided in sub. (2) or (3).
AB2,42,15
14(2) Division approval. A universal bank may hold or purchase more than 10%
15of its capital stock, notes, or debentures, if approved by the division.
AB2,43,2
16(3) Additional authority. A universal bank may hold or purchase more than
1710% of its capital stock, notes, or debentures if the purchase is necessary to prevent
18loss upon a debt previously contracted in good faith. Stock, notes, or debentures held
19or purchased under this subsection may not be held by the universal bank for more
20than 6 months if the stock, notes, or debentures can be sold for the amount of the
21claim of the universal bank against the holder of the debt previously contracted. The
22universal bank shall either sell the stock, notes, or debentures within 12 months of
23acquisition under this subsection or shall cancel the stock, notes, or debentures.
24Cancellation of the stock, notes, or debentures reduces the amount of the universal
25bank's capital stock, notes, or debentures. If the reduction reduces the universal
1bank's capital below the minimum level required by the division, the universal bank
2shall increase its capital to the amount required by the division.
AB2,43,8
3(4) Loans secured by capital, surplus, or deposits. A universal bank may not
4loan any part of its capital, surplus, or deposits on its own capital stock, notes, or
5debentures as collateral security, except that a universal bank may make a loan
6secured by its own capital stock, notes, or debentures to the same extent that the
7universal bank may make a loan secured by the capital stock, notes, and debentures
8of a holding company for the universal bank.
AB2,43,13
9222.0409 Stock in bank-owned banks. With the approval of the division,
10a universal bank may acquire and hold stock in one or more banks chartered under
11s. 221.1202 or national banks chartered under
12 USC 27 (b) or in one or more
12holding companies wholly owning such a bank. Aggregate investments under this
13section may not exceed 10% of the universal bank's capital.
AB2,43,18
14222.0411 General deposit powers. (1) In general. A universal bank may
15set eligibility requirements for, and establish the types and terms of, deposits that
16the universal bank solicits and accepts. The terms set under this subsection may
17include minimum and maximum amounts that the universal bank may accept and
18the frequency and computation method of paying interest.
AB2,43,21
19(2) Pledge of security for deposits. Subject to the limitations of s. 221.0324
20that are applicable to banks, a universal bank may pledge its assets as security for
21deposits.
AB2,43,24
22(3) Securitization of assets. With the approval of the division, a universal
23bank may securitize its assets for sale to the public. The division may establish
24procedures governing the exercise of authority granted under this subsection.
AB2,44,14
1(4) Safe deposit powers. A universal bank may take and receive, from any
2individual or corporation for safekeeping and storage, gold and silver plate, jewelry,
3money, stocks, securities, and other valuables or personal property, and may rent out
4the use of safes or other receptacles upon its premises for such compensation as may
5be agreed upon. A universal bank has a lien for its charges on any property taken
6or received by it for safekeeping. If the lien is not paid within 2 years from the date
7the lien accrues, or if property is not called for by the person depositing the property,
8or by his or her representative or assignee, within 2 years from the date the lien
9accrues, the universal bank may sell the property at public auction. A universal bank
10shall provide the same notice for a sale under this subsection that is required by law
11for sales of personal property on execution. After retaining from the proceeds of the
12sale all of the liens and charges due the bank and the reasonable expenses of the sale,
13the universal bank shall pay the balance to the person depositing the property, or to
14his or her representative or assignee.
AB2,44,20
15222.0413 Necessary or convenient powers, reasonably related or
16incidental activities, and other approved activities. (1) Necessary or
17convenient powers. Unless otherwise prohibited or limited by this chapter, a
18universal bank may exercise all powers necessary or convenient to effect the
19purposes for which the universal bank is organized or to further the businesses in
20which the universal bank is lawfully engaged.
AB2,45,5
21(2) Reasonably related and incidental activities. (a) Subject to any
22applicable state or federal regulatory or licensing requirements, a universal bank
23may engage, directly or indirectly through a subsidiary, in activities reasonably
24related or incident to the purposes of the universal bank. Activities reasonably
25related or incident to the purposes of the universal bank are those activities that are
1part of the business of financial institutions, or closely related to the business of
2financial institutions, or convenient and useful to the business of financial
3institutions, or reasonably related or incident to the operation of financial
4institutions, or financial in nature. Activities that are reasonably related or incident
5to the purposes of a universal bank include the following:
AB2,45,66
1. Business and professional services.
AB2,45,77
2. Data processing.
AB2,45,88
3. Courier and messenger services.
AB2,45,99
4. Credit-related activities.
AB2,45,1010
5. Consumer services.
AB2,45,1111
6. Real estate-related services, including real estate brokerage services.
AB2,45,1212
7. Insurance and related services, other than insurance underwriting.
AB2,45,1313
8. Securities brokerage.
AB2,45,1414
9. Investment advice.
AB2,45,1515
10. Securities and bond underwriting.
AB2,45,1616
11. Mutual fund activities.
AB2,45,1717
12. Financial consulting.
AB2,45,1818
13. Tax planning and preparation.
AB2,45,1919
14. Community development and charitable activities.
AB2,45,2020
15. Debt cancellation contracts.
AB2,45,2221
16. Any activities that are reasonably related or incident to activities under
22subds. 1. to 15., as determined by the division.
AB2,46,623
(b) An activity that is authorized by statute or regulation for financial
24institutions to engage in as of the effective date of this paragraph .... [revisor inserts
25date], is an activity that is reasonably related or incident to the purposes of a
1universal bank. An activity permitted under the Bank Holding Company Act is an
2activity that is reasonably related or incident to the purposes of a universal bank.
3The division may expand the list of activities under par. (a) 1. to 15. that are
4reasonably related or incident to the purposes of a universal bank. Any activity
5approved by the division under this paragraph shall be authorized for all universal
6banks.
AB2,46,9
7(3) Notice requirement. A universal bank shall give 60 days' prior written
8notice to the division of the universal bank's intention to engage in an activity under
9this section.
AB2,46,17
10(4) Standards for denial. The division may deny the authority of a universal
11bank to engage in an activity under this section, other than those activities described
12in sub. (2) (a) 1. to 15., if the division determines that the activity is not an activity
13reasonably related or incident to the purposes of a universal bank. The division may
14deny the authority of a universal bank to engage in an activity under this section if
15the division determines that the universal bank is not well-capitalized, that the
16universal bank is the subject of an enforcement action, or that the universal bank
17does not have satisfactory management expertise for the proposed activity.
AB2,46,21
18(5) Insurance intermediation. A universal bank, or an officer or salaried
19employee of a universal bank, may obtain a license as an insurance intermediary, if
20otherwise qualified. A universal bank may not, directly or indirectly through a
21subsidiary, engage in the business of underwriting insurance.
AB2,46,23
22(6) Other activities approved by the division. A universal bank may engage
23in any other activity that is approved by rule of the division.
AB2,47,2
24(7) Activities provided through a subsidiary. A universal bank may engage
25in an activity under this section, directly or indirectly through a subsidiary, unless
1the division determines that the activity must be conducted through a subsidiary
2with appropriate safeguards to limit the risk exposure of the universal bank.
AB2,47,8
3(8) Limitations on investments through subsidiaries. The amount of the
4investment in any one subsidiary that engages in an activity under this section may
5not exceed 20% of a universal bank's capital or, if approved by the division, a higher
6percentage. The aggregate investment in all subsidiaries that engage in an activity
7under this section may not exceed 50% of a universal bank's capital or, if approved
8by the division, a higher percentage.
AB2,47,11
9(9) Ownership of subsidiaries. A subsidiary that engages in an activity under
10this section may be owned jointly, with one or more other financial institutions,
11individuals, or entities.
AB2,47,13
12222.0415 Trust powers. Subject to rules of the division, a universal bank may
13exercise trust powers in accordance with s. 221.0316.
AB2, s. 49
14Section
49. 409.617 (1) (c) of the statutes is amended to read:
AB2,47,1715
409.617
(1) (c) Discharges any subordinate security interest or other
16subordinate lien
other than liens held by this state or a local governmental unit, as
17defined in s. 19.42 (7u).
AB2,48,319
(1)
Emergency rules; universal banking. Except as otherwise provided in this
20subsection, using the procedure under section 227.24 of the statutes, the division of
21banking may promulgate rules authorized under chapter 222 of the statutes, as
22created by this act, for the period before permanent rules become effective, but not
23to exceed the period authorized under section 227.24 (1) (c) and (2) of the statutes.
24Notwithstanding section 227.24 (1) (a), (2) (b), and (3) of the statutes, the division of
25banking is not required to provide evidence that promulgating a rule under this
1subsection as an emergency rule is necessary for the preservation of the public peace,
2health, safety, or welfare and is not required to provide a finding of emergency for a
3rule promulgated under this subsection.
AB2, s. 51
4Section
51.
Effective dates. This act takes effect on the day after publication,
5except as follows:
AB2,48,86
(1)
The treatment of sections 220.04 (9) (a) 2. and 220.14 (5) and chapter 222
7of the statutes takes effect on the first day of the 3rd month beginning after
8publication.