AB872: Bill Text

AB872, s. 15 Section 15. 220.04 (7) (b) 3. of the statutes is amended to read:

AB872,14,25 220.04 (7) (b) 3. Require the organization to maintain reasonable safeguards to protect fiduciary property including the maintenance of an indemnity fund in the same manner as that required of trust company banks under s. 223.02 (1).

AB872, s. 16 Section 16. 220.04 (9) (a) 2. of the statutes, as affected by 1995 Wisconsin Act 27, is amended to read:

AB872,15,5 220.04 (9) (a) 2. "Regulated entity" means a bank, trust company bank and any other entity which is described in s. 220.02 (2) or 221.56 221.0526 as under the supervision and control of the division.

AB872, s. 17 Section 17. 220.04 (10) of the statutes, as affected by 1995 Wisconsin Act 27, is amended to read:

AB872,15,20 220.04 (10) If it appears to the division that a person has engaged or is about to engage in an act or practice constituting a violation of the laws of this state relating to banks and banking, including this chapter, chs. 217, 218 and 221 to 224 and s. 138.09, or a rule promulgated or order issued under those laws, the division may bring an action in the name of the state in the circuit court of the appropriate county to enjoin the acts or practices and to enforce compliance with the laws, rules or orders, or the division may refer the matter to the district attorney of the appropriate county or, if the alleged violation may be enforced by the attorney general under sub. (12) or s. 220.12, 221.18, 221.205, 221.28 221.1005 or 224.06 (7) or is statewide in nature, to the attorney general. Upon a proper showing, the court may grant a permanent or temporary injunction or restraining order, appoint a receiver for the defendant or the defendant's assets or order rescission of any acts determined to be unlawful. The court may not require the division to post a bond.

AB872, s. 18 Section 18. 220.04 (11) of the statutes is created to read:

AB872,15,24 220.04 (11) In order to carry out ss. 220.07, 220.08 and 221.1005, the division may commence and maintain in the division's name any and all actions necessary or proper to enforce any of said sections.

AB872, s. 19 Section 19. 220.04 (12) of the statutes is created to read:

AB872,16,17 220.04 (12) If the division has information that causes the division to believe that any bank, trust company bank, or any other person subject in whole or in part to supervision or control by the division, or any officer, employe, member or manager thereof, has violated any law, rule or order that subjects the person to prosecution for a criminal offense or to a penalty, the division shall bring such information to the attention of the banking review board, with the division's recommendation in writing as to action to be taken. The banking review board shall, if in its judgment probable cause exists for believing that a criminal offense has been committed, or a penalty incurred, call the facts and information to the attention of the attorney general whose duty it shall be to cause prosecution or other action to be instituted if, in the attorney general's judgment, the facts warrant. This subsection does not prevent the institution of any prosecution by any district attorney of this state with or without any advice or act on the part of the attorney general. This subsection does not preclude the division, in any case where the division deems it important to act immediately, from causing any arrest and prosecution where the division is satisfied that there is reason to believe the offense has been committed and that prosecution should be immediately commenced.

AB872, s. 20 Section 20. 220.06 (1m) of the statutes, as affected by 1995 Wisconsin Act 27, is amended to read:

AB872,17,13 220.06 (1m) No division employe may examine a bank or licensee in which that person is interested as a stockholder, officer or employe. No division employe may examine a bank or licensee located in the same village, city or county with any bank or licensee in which that person is so interested. Employes in the division, and each member and employe of the banking review board, shall keep secret all facts and information obtained in the course of examinations or from reports not under s. 221.15 221.1002 (1) filed by a bank or licensee with the division, except so far as the public duty of the person requires reporting upon or taking special action regarding the affairs of any bank or licensee, and except when called as a witness in any criminal proceeding or trial in a court of justice. The division may furnish to the federal deposit insurance corporation or to any regulatory authority for state or federal financial institutions, insurance or securities a copy of any examination made of any such bank or licensee or of any report made by such bank or licensee and may give access to and disclose to the corporation or to any regulatory authority for state or federal financial institutions, insurance or securities any information possessed by the division with reference to the conditions or affairs of any such insured bank or licensee if the regulatory authority agrees to treat all information received with the same degree of confidentiality as applies to reports of examination that are in the custody of the division.

AB872, s. 21 Section 21. 220.075 of the statutes, as affected by 1995 Wisconsin Act 27, is repealed.

AB872, s. 22 Section 22. 220.08 (3am) of the statutes is created to read:

AB872,17,20 220.08 (3am) On taking possession of a bank for liquidation, the division may transfer the trust accounts of the bank to another entity with fiduciary powers. Neither the division nor the fiduciary to whom the trust accounts are transferred is liable for the past acts of the bank relating to the trust accounts.

AB872, s. 23 Section 23. 220.09 of the statutes, as affected by 1995 Wisconsin Act 27, is amended to read:

AB872,18,10 220.09 Indemnity fund, national bank. Every national bank which has been granted a special permit by the federal reserve board authority under federal law to act in a fiduciary capacity under the provisions of subsection (k) of section 11, of the federal reserve act shall deposit with the state treasurer security, approved by the division, in the manner which is required of trust company banks organized under shall comply with s. 223.02. Such securities shall be of the same nature as the security designated by the provisions of such section for the deposit by trust companies organized under the laws of this state. Such national bank, so long as it shall continue solvent and comply with the laws of this state applicable thereto, may be permitted by the division to collect the interest on the security so deposited and from time to time withdraw the said securities or any part thereof provided that securities or cash of the amount and value required by this section shall at all times be maintained on deposit.

AB872, s. 24 Section 24. Chapter 221 of the statutes, as affected by 1995 Wisconsin Acts 27 and 55, is repealed and recreated to read:

AB872,18,14 Chapter 221 State banks

AB872,18,16 SUBCHAPTER I GENERAL PROVISIONS

AB872,18,18 221.0101 Title. This chapter may be cited as the "Wisconsin banking law".

AB872,18,19 221.0102 Definitions. In this chapter:

AB872,18,21 (1) "Articles of incorporation" includes amended and restated articles of incorporation.

AB872,18,23 (2) "Authorized shares" means the shares of all classes that a bank is authorized to issue.

AB872,18,24 (3) "Capital stock" means the stock of a bank, other than preferred stock.

AB872,19,2 (4) "Capital" means, with respect to any bank, the sum of all of the following, less the bank's intangible assets:

AB872,19,3 (a) The bank's capital stock.

AB872,19,4 (b) The bank's preferred stock.

AB872,19,5 (c) The bank's undivided profits.

AB872,19,7 (d) Outstanding notes and debentures of the bank that are legally issued and sold by the bank and approved by the division under s. 221.0318 (2).

AB872,19,9 (5) "Record date" means the date on which a bank determines the identity of its shareholders for purposes of this chapter.

AB872,19,12 (6) "Shareholder" means the person in whose name shares are registered in the records of a bank or, to the extent of the rights granted by a nominee certificate on file with a bank, the beneficial owner of the shares.

AB872,19,14 (7) "Subscriber" means a person who subscribes for shares in a bank, whether before or after incorporation of the bank.

AB872,19,17 (8) "Treasury shares" means shares of a bank that have been issued, that have been subsequently acquired by and belong to the bank, and that have not been canceled or restored to the status of authorized but unissued shares.

AB872,19,18 (9) "Voting group" means any of the following:

AB872,19,21 (a) All shares of one or more classes or series that, under the articles of incorporation or this chapter, are entitled to vote and be counted together collectively on a matter at a meeting of shareholders.

AB872,19,23 (b) All shares that under the articles of incorporation or this chapter are entitled to vote generally on a matter.

AB872,20,3 221.0103 Notice. (1) Applicability. This section applies to a notice that is required under this chapter or that is made subject to this section by express reference to this section.

AB872,20,6 (2) When oral notice permitted. A person shall give notice in writing, except that notices to or from a bank may be given orally, if permitted by the bank's articles of incorporation or bylaws and not otherwise prohibited by this chapter.

AB872,20,13 (3) Method of providing written notice. Unless otherwise provided in the articles of incorporation or bylaws, notice may be communicated in person, by telephone, telegraph, teletype, facsimile or other form of wire or wireless communication, or by mail or private carrier. If these forms of personal notice are impracticable, notice may be communicated by a newspaper of general circulation in the area where published or by radio, television or other form of public broadcast communication.

AB872,20,16 (4) Date notice is effective. (a) Except as provided in par. (b) and ss. 221.0607 (2) and 221.0622 (1), written notice is effective on the earliest of the following:

AB872,20,17 1. On the date received.

AB872,20,19 2. Five days after deposit of the notice in the U.S. mail, if mailed postpaid and correctly addressed.

AB872,20,22 3. On the date shown on the return receipt, if the notice is sent by registered or certified mail, return receipt requested, and if the receipt is signed by or on behalf of the addressee.

AB872,20,23 4. On the effective date specified in the articles of incorporation or bylaws.

AB872,21,3 (b) Written notice by a bank to a shareholder of the bank is effective when mailed. The notice may be addressed to the shareholder's address shown in the bank's current record of shareholders.

AB872,21,4 (c) Oral notice is effective when communicated.

AB872,21,9 221.0104 Applicability. This chapter applies to all banks organized and existing within this state. The powers, privileges, duties and restrictions conferred and imposed upon a bank existing and doing business under the laws of this state are hereby abridged, enlarged or modified, as each particular case may require, to conform to this chapter.

AB872,21,12 221.0105 Fees. The division may establish such fees as it determines are appropriate for documents filed with the division under this chapter and for such other services as the division may provide under this chapter.

AB872,21,13 SUBCHAPTER II

AB872,21,14 BANK ORGANIZATION

AB872,21,18 221.0201 Applicants. Any number of adult residents of this state, not less than 3 nor more than 20, who desire to associate for the purpose of organizing a banking corporation under this chapter, may apply to the division to organize a bank. The application shall be made on a form prescribed by the division.

AB872,21,20 221.0202 Application. (1) Contents. An application under s. 221.0201 shall be prepared and filed in duplicate, and shall include all of the following:

AB872,21,21 (a) The location of the proposed bank.

AB872,21,22 (b) The character of the business to be transacted by the proposed bank.

AB872,21,23 (c) The proposed capital of the proposed bank.

AB872,21,24 (d) The full name, residence, and occupation of each applicant.

AB872,21,25 (e) Other information required by the division.

AB872,22,9 (2) Notice of application. Upon receipt by the division of properly executed application, the division shall, within 5 days, forward to the applicants a copy of a notice of application for authority to organize a bank. The notice of application shall contain the information required under sub. (1) and a date and place for hearing on the application. The notice shall be published as a class 3 notice, under ch. 985, by the applicants, at their own expense, in the city, village or town where the bank is to be located. Proof of publication shall be filed with the division in such form as the division requires. The division may waive the requirement of publication, if the bank to be organized is to replace, absorb or consolidate one or more existing banks.

AB872,22,12 (3) Fee. The applicants shall pay to the division a fee in an amount determined by the division, together with the actual costs incurred by the division in making an investigation under sub. (4) of the application.

AB872,22,14 (4) Investigation. (a) At the hearing and by such investigation as the division considers necessary, the division shall consider all of the following:

AB872,22,18 1. Whether the character, responsibility and general fitness of the persons named in the application command confidence and warrant the belief that the business of the proposed bank will be honestly and efficiently conducted in accordance with this chapter.

AB872,22,20 2. Whether public convenience and advantage will be promoted by allowing the bank to organize.

AB872,22,21 3. The character and experience of the proposed officers.

AB872,22,23 4. The adequacy of existing banking facilities and the need of further banking capital.

AB872,22,25 5. The outlook for the growth and development of the area where the bank is to be located.

AB872,23,4 6. The methods and banking practices of any existing banks in the area where the bank is to be located; the interest rate that these existing banks charge to borrowers; and the character of the service which these existing banks provide to the community.

AB872,23,5 7. The prospects for the success of the proposed bank if efficiently managed.

AB872,23,9 (b) The division shall complete the investigation within 90 days after the filing with the division of proof of publication under sub. (2) and the paying of the fee under sub. (3), whichever is later. If a majority of the applicants and the division mutually agree, the time may be extended for an additional period of 60 days.

AB872,23,19 (5) Decision. After completing the investigation under sub. (4), the division shall make a written report to the banking review board stating the results of the investigation and the division's recommendation. The board shall consider the matter, conduct any necessary hearing and promptly make its decision approving or disapproving the application. The decision shall be final except pursuant to s. 220.035 (1) and (3). If the application is approved, the division shall endorse on each of the original applications the word "Approved". If the application is disapproved, the division shall endorse the word "Disapproved". One of the duplicate originals shall be filed in the division's office and one shall be returned by mail to the applicants.

AB872,23,25 221.0203 Certificate of authority. (1) Powers granted by certificate. If an application for authority to organize a banking corporation is approved, the division shall issue a certificate of authority to the applicants, who shall thereafter be known as the incorporators. The certificate of authority shall grant the incorporators such powers as are incidentally or necessarily preliminary to the organization of a banking corporation. These powers include all of the following:

AB872,24,2 (a) Creating a temporary organization, consisting of a chairperson, a secretary and a treasurer.

AB872,24,3 (b) Executing and filing articles of incorporation.

AB872,24,5 (c) Adopting rules for the conduct of meetings of the incorporators and of the first meeting of the shareholders.

AB872,24,6 (d) Opening subscription books for stock.

AB872,24,7 (e) Securing an option on real estate to be used as a bank office.

AB872,24,8 (f) Fixing an amount at which the stock shall be sold.

AB872,24,9 (g) Collecting subscriptions to the stock.

AB872,24,10 (h) Selecting a depository for funds as may be collected.

AB872,24,11 (i) Appointing any agent or agents.

AB872,24,12 (j) Compiling a set of bylaws for submission to the shareholders.

AB872,24,15 (2) Voting requirements. Following the incorporation of a bank, an action permitted by this chapter to be taken by its incorporators may be taken by the majority of its incorporators or the survivors of the incorporators.

AB872,25,6 221.0204 Temporary organization. The chairperson of the incorporators shall preside at all meetings and shall exercise other duties that are ordinarily performed by a chairperson. The secretary shall manage the correspondence of the incorporators, record fully all proceedings of the meetings of the incorporators, file and preserve all documents and papers of the organization, and file any necessary papers with the division. The treasurer shall receive all moneys paid in on subscriptions to stock or for other purposes, keep a true account thereof, deposit these funds in the designated depository, and pay such valid orders as may be drawn on the treasurer. The incorporators shall require a bond in a suitable amount from the treasurer and from other officers and agents who may handle the funds of the proposed bank. The incorporators shall audit claims against the proposed bank and record of action on these claims in the minutes. If a claim is ordered paid, an order shall be drawn upon the treasurer and signed by the chairperson and secretary. Until the completion of the organization of the proposed bank, the incorporators may exercise the powers conferred upon incorporators of corporations under ch. 180, to the extent that these powers are not in conflict with this chapter.

AB872,25,12 221.0205 Capital stock. (1) Capital requirements. Immediately following a bank's organization under this chapter, the division shall determine the required capital of the bank, subject to review by the banking review board. In addition to the required capital stock, a contingent fund and paid-in surplus each in an amount equal to at least 25% of the aggregate amount of the capital stock, shall be subscribed at the time the subscription list of shareholders is prepared by the incorporators.

AB872,25,16 (2) Unimpairment of capital stock. The capital stock of a bank is unimpaired when the amount of capital notes and debentures, as represented by cash or sound assets, or the amount of such preferred stock, or both, equals or exceeds the capital requirement established by the division under sub. (1).

AB872,25,22 221.0206 Articles of incorporation. (1) Time for filing. The incorporators shall file articles of incorporation with the division within a reasonable time, as determined by the division, from the date on which the division approved the certificate of authority. If the incorporators do not file the articles of incorporation within this period, all rights of the incorporators cease and the certificate of authority to organize is void.

AB872,26,2 (2) Form and contents. (a) The articles of incorporation shall be executed in duplicate, and shall be signed by the majority of the incorporators. All signers must be residents of this state and must be subscribers to stock of the bank or of a bank holding company of the bank.

AB872,26,3 (b) The articles of incorporation shall contain all of the following: