Amendment ASA1-SB274

SB274-ASA1,10,4 (cr) The applicant has failed to propose to provide adequate and appropriate services of the type contemplated by the community reinvestment act of 1977 in the community in which the in-state Wisconsin credit union which the applicant proposes to acquire or merge with is located.

SB274-ASA1, s. 33 Section 33. 186.41 (6) (a) of the statutes is renumbered 186.41 (6).

SB274-ASA1, s. 34 Section 34. 186.41 (6) (b) of the statutes is repealed.

SB274-ASA1, s. 35 Section 35. 186.41 (8) of the statutes is repealed.

SB274-ASA1, s. 36 Section 36. 186.45 of the statutes is created to read:

SB274-ASA1,10,10 186.45 Non-Wisconsin credit union, Wisconsin offices. (1) Definitions. In this section:

SB274-ASA1,10,12 (a) "Non-Wisconsin credit union" means a credit union organized under the laws of and with its principal office located in a state other than this state.

SB274-ASA1,10,13 (b) "Wisconsin credit union" has the meaning given in s. 186.41 (1) (bm).

SB274-ASA1,10,18 (2) Approval. A non-Wisconsin credit union may open an office and conduct business as a credit union in this state if the office of credit unions finds that Wisconsin credit unions are allowed to do business in the other state under conditions similar to those contained in this section and that all of the following apply to the non-Wisconsin credit union:

SB274-ASA1,10,20 (a) It is a credit union organized under laws similar to the credit union laws of this state.

SB274-ASA1,10,21 (b) It is financially solvent based upon national board ratings.

SB274-ASA1,10,22 (c) It has member savings insured with federal share insurance.

SB274-ASA1,10,24 (d) It is effectively examined and supervised by the credit union authorities of the state in which it is organized.

SB274-ASA1,11,2 (e) It has received approval from the credit union authorities of the state in which it is organized.

SB274-ASA1,11,4 (f) It has a need to place an office in this state to adequately serve its members in this state.

SB274-ASA1,11,6 (g) It meets all other relevant standards or qualifications established by the office of credit unions.

SB274-ASA1,11,8 (3) Requirements. A non-Wisconsin credit union shall agree to do all of the following:

SB274-ASA1,11,10 (a) Grant loans at rates not in excess of the rates permitted for Wisconsin credit unions.

SB274-ASA1,11,11 (b) Comply with this state's laws.

SB274-ASA1,11,12 (c) Designate and maintain an agent for the service of process in this state.

SB274-ASA1,11,16 (4) Records. As a condition of a non-Wisconsin credit union doing business in this state under this section, the office of credit unions may require copies of examination reports and related correspondence regarding the non-Wisconsin credit union.

SB274-ASA1, s. 37 Section 37. 186.80 of the statutes is created to read:

SB274-ASA1,11,19 186.80 False statements. (a) No officer, director or employe of a credit union may do any of the following:

SB274-ASA1,11,21 1. Wilfully and knowingly subscribe to or make, or cause to be made, a false statement or entry in the books of the credit union.

SB274-ASA1,11,23 2. Knowingly subscribe to or exhibit false information with the intent to deceive any person authorized to examine the affairs of the credit union.

SB274-ASA1,11,25 3. Knowingly make, state or publish any false report or statement of the credit union.

SB274-ASA1,12,2 (b) Any person who violates par. (a) may be fined not less than $1,000 nor more than $5,000 or imprisoned for not less than one year nor more than 15 years or both.

SB274-ASA1, s. 38 Section 38. 220.04 (9) (a) 2. of the statutes is amended to read:

SB274-ASA1,12,6 220.04 (9) (a) 2. "Regulated entity" means a bank, universal bank, trust company bank and any other entity which is described in s. 220.02 (2) or 221.0526 as under the supervision and control of the division.

SB274-ASA1, s. 39 Section 39. 220.14 (5) of the statutes is created to read:

SB274-ASA1,12,9 220.14 (5) Contain a statement of the total number of orders issued by the division during the year under s. 222.0203 (2).

SB274-ASA1, s. 40 Section 40. Chapter 222 of the statutes is created to read:

SB274-ASA1,12,12 CHAPTER 222 UNIVERSAL BANKS

SB274-ASA1,12,14 Subchapter I General Provisions

SB274-ASA1,12,16 222.0101 Title. This chapter may be cited as the "Wisconsin universal bank law".

SB274-ASA1,12,17 222.0102 Definitions. In this chapter:

SB274-ASA1,12,20 (2) "Capital" of a universal bank means the sum of the following, less the amount of intangible assets that is not considered to be qualifying capital by a deposit insurance corporation or the division:

SB274-ASA1,12,25 (a) For a universal bank organized as a stock organization, the universal bank's capital stock, preferred stock, undivided profits, surplus, outstanding notes and debentures approved by the division, other forms of capital designated as capital by the division and other forms of capital considered to be qualifying capital of the universal bank by a deposit insurance corporation.

SB274-ASA1,13,5 (b) For a universal bank organized as a mutual organization, the universal bank's net worth, undivided profits, surplus, outstanding notes and debentures approved by the division, other forms of capital designated as capital by the division and other forms of capital considered to be qualifying capital by a deposit insurance corporation.

SB274-ASA1,13,9 (3) "Deposit insurance corporation" means the Federal Deposit Insurance Corporation or other instrumentality of, or corporation chartered by, the United States that insures deposits of financial institutions and that is supported by the full faith and credit of the U.S. government as stated in a congressional resolution.

SB274-ASA1,13,10 (4) "Division" means the division of banking.

SB274-ASA1,13,13 (5) "Financial institution" means a state savings bank organized under ch. 214, state savings and loan association organized under ch. 215 or a state bank chartered under ch. 221.

SB274-ASA1,13,15 (6) "Universal bank" means a financial institution that has been issued a certificate of authority under s. 222.0205.

SB274-ASA1,13,16 (7) "Well-capitalized" has the meaning given in 12 USC 1831o (b) (1) (A).

SB274-ASA1,13,21 222.0103 Applicability. (1) Savings banks. A universal bank that is a savings bank organized under ch. 214 remains subject to all of the requirements, duties and liabilities, and may exercise all of the powers, of a savings bank, except that in the event of a conflict between this chapter and those requirements, duties, liabilities or powers, this chapter shall control.

SB274-ASA1,14,2 (2) Savings and loan associations. A universal bank that is a savings and loan association organized under ch. 215 remains subject to all of the requirements, duties and liabilities, and may exercise all of the powers, of a savings and loan association, except that, in the event of a conflict between this chapter and those requirements, duties, liabilities or powers, this chapter shall control.

SB274-ASA1,14,6 (3) Banks. A universal bank that is a bank chartered under ch. 221 remains subject to all of the requirements, duties and liabilities, and may exercise all of the powers, of a bank, except that, in the event of a conflict between this chapter and these requirements, duties, liabilities or powers, this chapter shall control.

SB274-ASA1,14,9 222.0105 Fees. The division may establish such fees as it determines are appropriate for documents filed with the division under this chapter and for services provided by the division under this chapter.

SB274-ASA1,14,11 222.0107 Administration. (1) Powers of division. The division shall administer this chapter for all universal banks.

SB274-ASA1,14,16 (2) Rule-making authority. The division may promulgate rules to administer and carry out this chapter. The division may establish additional limits or requirements on universal banks, if the division determines that the limits or requirements are necessary for the protection of depositors, members, investors or the public.

SB274-ASA1,14,18 SUBCHAPTER II Certification

SB274-ASA1,14,23 222.0201 Procedure. (1) Application. A financial institution may apply to become certified as a universal bank by filing a written application with the division. The application shall include such information as the division may require. The application shall be on such forms and in accordance with such procedures as the division may prescribe.

SB274-ASA1,15,4 (2) Review by division. An application submitted by a financial institution under sub. (1) shall either be approved or disapproved by the division, in writing, within 60 days after its submission to the division. The division and the financial institution may mutually agree to extend the application period for an additional period of 60 days. The division shall approve an application if all of the applicable requirements under s. 222.0203 (1) are met.

SB274-ASA1,15,7 222.0203 Eligibility. (1) Requirements. The division may approve an application from a financial institution for certification as a universal bank only if all of the following requirements are met:

SB274-ASA1,15,10 (a) The financial institution is chartered or organized, and regulated, under ch. 214, 215 or 221 and has been in existence and continuous operation for a minimum of 3 years before the date of the application.

SB274-ASA1,15,11 (b) The financial institution is well-capitalized.

SB274-ASA1,15,16 (c) The financial institution does not exhibit a combination of financial, managerial, operational and compliance weaknesses that is moderately severe or unsatisfactory, as determined by the division based upon the division's assessment of the financial institution's capital adequacy, asset quality, management capability, earnings quantity and quality, adequacy of liquidity, and sensitivity to market risk.

SB274-ASA1,15,20 (d) During the 12-month period before the date of the application, the financial institution has not been the subject of an enforcement action and there is no enforcement action pending against the financial institution by any state or federal financial institution regulatory agency, including the division.

SB274-ASA1,15,25 (e) The most current evaluation prepared under 12 USC 2906 that the financial institution has received rates the financial institution as "outstanding" or "satisfactory" in helping to meet the credit needs of its entire community, including low-income and moderate-income neighborhoods, consistent with the safe and sound operation of the financial institution.

SB274-ASA1,16,6 (f) If the financial institution has received from its federal functional regulator, as defined in 15 USC 6809 (2), a consumer compliance examination that contains information regarding the financial institution's compliance with 15 USC 6801 to 6803 and any applicable regulations prescribed under 15 USC 6804, the most recent such examination indicates, in the opinion of the division, that the financial institution is in substantial compliance with those statutes or regulations.

SB274-ASA1,16,13 (2) Failure to maintain eligibility; limitation of authority and decertification. For any period during which a universal bank fails to meet the requirements under sub. (1), the division shall by order limit or restrict the exercise of the powers of the universal bank under this chapter. In addition to or lieu of limiting or restricting the universal bank's authority under this subsection, the division may by order revoke the universal bank's certificate of authority issued under s. 222.0205.

SB274-ASA1,16,17 222.0205 Certificate of authority. Upon approval of an application for certification as a universal bank, the division shall issue to the applicant a certificate of authority stating that the financial institution is certified as a universal bank under this chapter.

SB274-ASA1,17,2 222.0207 Voluntary termination of certification. A financial institution that is certified as a universal bank under this chapter may elect to terminate its certification by giving 60 days' prior written notice of the termination to the division. A termination under this section is effective only with the written approval of the division. A financial institution shall, as a condition to a termination under this section, terminate its exercise of all powers granted under this chapter before the termination of the certification. The division's written approval of a financial institution's termination under this section is void if the financial institution fails to satisfy the precondition to termination under this section.

SB274-ASA1,17,4 SUBCHAPTER III ORGANIZATION

SB274-ASA1,17,9 222.0301 Articles of incorporation and bylaws. A universal bank shall continue to operate under its articles of incorporation and bylaws as in effect prior to certification as a universal bank or as such articles or bylaws may be subsequently amended in accordance with the provisions of the chapter under which the universal bank was organized or chartered.

SB274-ASA1,17,16 222.0303 Name. (1) Use of "bank". Notwithstanding ss. 214.035, 215.40 (1) and 215.60 (1) and subject to subs. (2) and (4), a universal bank may use the word "bank" in its name, without having to include the word "savings". Notwithstanding ss. 215.40 (1) and 215.60 (1) and subject to subs. (2) and (4), a universal bank that is organized under ch. 215 and that uses the word "bank" in its name in accordance with this section need not include the words "savings and loan association" or "savings association" in its name.

SB274-ASA1,17,19 (2) Distinguishability. Except as provided in subs. (3) and (4), the name of the universal bank shall be distinguishable upon the records of the division from all of the following names:

SB274-ASA1,17,21 (a) The name of any other financial institution organized under the laws of this state.

SB274-ASA1,17,23 (b) The name of a national bank or foreign bank authorized to transact business in this state.

SB274-ASA1,18,2 (3) Exceptions. A universal bank may apply to the division for authority to use a name that does not meet the requirement under sub. (2). The division may authorize the use of the name if any of the conditions under s. 221.0403 (2) (a) or (b) is met.

SB274-ASA1,18,5 (4) Use of same name. A universal bank may use a name that is used in this state by another financial institution or by an institution authorized to transact business in this state, if the universal bank has done any of the following:

SB274-ASA1,18,6 (a) Merged with the other institution.

SB274-ASA1,18,7 (b) Been formed by reorganization of the other institution.

SB274-ASA1,18,9 (c) Acquired all or substantially all of the assets, including the name, of the other institution.

SB274-ASA1,18,12 222.0305 Capital and assets. (1) Capital requirements. Notwithstanding subch. VI of ch. 214 and ss. 215.24 and 221.0205, the division shall determine the minimum capital requirements of universal banks.

SB274-ASA1,18,14 (2) Certain asset requirements. Section 214.045 does not apply to universal banks.

SB274-ASA1,18,21 222.0307 Acquisitions, mergers and asset purchases. (1) In general. A universal bank may, with the approval of the division, purchase the assets of, merge with, acquire or be acquired by any other financial institution, universal bank, national bank, federally chartered savings bank or savings and loan association, or by a holding company of any of these entities. Notwithstanding subch. III of ch. 214 and ss. 214.09 and 215.36, the approval of the division of savings and loan is not required.

SB274-ASA1,18,25 (2) Applications for approval. An application for approval under sub. (1) shall be submitted on a form prescribed by the division and accompanied by a fee determined by the division. In processing and acting on applications under this section the division shall apply the following standards:

SB274-ASA1,19,2 (a) For universal banks organized under ch. 214, ss. 214.09, 214.62 to 214.64 and 214.665 and subch. III of ch. 214.

SB274-ASA1,19,4 (b) For universal banks organized under ch. 215, ss. 215.35, 215.36, 215.53 and 215.73.

SB274-ASA1,19,5 (c) For universal banks chartered under ch. 221, subchs. VII and IX of ch. 221.

SB274-ASA1,19,7 SUBCHAPTER IV POWERS

SB274-ASA1,19,12 222.0401 Federal financial institution powers. (1) In general. (a) Powers exercised by universal bank. A universal bank, with the approval of the division, may exercise any power that may be directly exercised by a federally chartered savings bank, a federally chartered savings and loan association or a federally chartered national bank.

SB274-ASA1,19,16 (b) Powers exercised by subsidiary of universal bank. A universal bank, through a subsidiary and with the approval of the division, may exercise any power that a federally chartered savings bank, a federally chartered savings and loan association or a federally chartered national bank may exercise through a subsidiary.

SB274-ASA1,19,24 (2) Approval required for exercise of federal power. A universal bank shall file with the division a written request to exercise a power under sub. (1). The division shall determine whether the requested power is permitted under sub. (1). Within 60 days after receiving a request under this subsection, the division shall approve the request, if the power is permitted under sub. (1), or shall disapprove the request if the power is not permitted under sub. (1). The division and the universal bank may mutually agree to extend this 60-day period for an additional period of 60 days.

SB274-ASA1,20,4 (3) Exercise of federal powers through a subsidiary. The division may require that certain powers exercisable by a universal bank under sub. (1) (a) be exercised through a subsidiary of the universal bank with appropriate safeguards to limit the risk exposure of the universal bank.

SB274-ASA1,20,7 222.0403 Loan powers. (1) Permitted purposes. A universal bank may make, sell, purchase, arrange, participate in, invest in or otherwise deal in loans or extensions of credit for any purpose.

SB274-ASA1,20,13 (2) In general. Except as provided in subs. (3) to (8), the total liabilities of any person, other than a municipal corporation, to a universal bank for a loan or extension of credit may not exceed 20% of the capital of the universal bank at any time. In determining compliance with this section, liabilities of a partnership includes the liabilities of the general partners, computed individually as to each general partner on the basis of his or her direct liability.

SB274-ASA1,20,16 (3) Certain secured liabilities. The percentage limitation under sub. (2) is 50% of the universal bank's capital, if the liabilities under sub. (2) are limited to the following types of liabilities: