214.72(1)(a)
(a) "Business relationship" means a financial interaction with a savings bank, including obtaining and renegotiating a loan; maintaining a deposit account or escrow account; obtaining and using a credit card; being a trustee or beneficiary of an estate or trust held by the savings bank; and renting a safe deposit box.
214.72(1)(am)
(am) "Department" means the department of financial institutions.
214.72(1)(b)
(b) "Financial regulator" means the department secretary and deputy secretary, and an administrator, a supervisor of data processing, legal counsel and a financial institution examiner employed by the department and includes any member of a financial regulator's immediate family, as defined in
s. 19.42 (7).
214.72(2)(a)(a) A financial regulator may not request, accept or enter into a business relationship with a savings bank unless the business relationship is in the savings bank's ordinary course of business, is negotiated at arms' length and the terms are no more favorable than those available to members of the general public in like circumstances.
214.72(2)(b)
(b) A financial regulator may not be an officer, director, employe or agent of a savings bank.
214.72(2)(c)
(c) A financial regulator may not voluntarily acquire equity securities in a savings bank or a savings bank holding company. A financial regulator shall transfer equity securities which he or she owns within 90 days after commencement of employment as a financial regulator or within 90 days after acquiring ownership by inheritance or gift.
214.72(2)(d)
(d) Notwithstanding
par. (a), a financial regulator may not obtain a new loan from or renegotiate, refinance, renew, extend or modify an existing loan with a savings bank. A financial regulator may exercise contract rights under an existing variable rate, escalator or balloon-type mortgage. A financial regulator is not required to terminate a loan existing at the time he or she becomes a financial regulator.
214.72(3)
(3) Within 30 days after commencing employment as a financial regulator and at least once each year, each financial regulator, for himself or herself and covering his or her immediate family, shall complete a written, sworn report disclosing the nature of all business relationships with savings banks on forms prescribed by the department. Each report shall be reviewed by the department, except that the secretary's and deputy secretary's report shall be reviewed by the review board. The reviewers shall determine if any business relationship is or appears improper and, if so, may direct the termination of that business relationship within a reasonable, prescribed time period.
214.72 History
History: 1991 a. 221;
1995 a. 27.
214.725(1)(1) At least once every 18 months and more often if necessary, the division shall examine the books, records, operations and affairs of a savings bank. In the course of the examination, the division may also examine in the same manner any entity, company or individual that the division determines may have a relationship with the savings bank or a savings bank holding company, savings bank subsidiary, service corporation or affiliate of the savings bank, if the relationship may adversely affect the affairs, activities and safety and soundness of the savings bank.
214.725(2)
(2) The division shall consider it to be necessary to conduct an examination more often than every 18 months if a required report from a savings bank indicates a material change in financial condition or a material violation of a state or federal law, of a federal regulation or of a rule of the division. If that condition is grounds for taking custody of the savings bank under
s. 214.76, the examination shall be initiated within 10 business days.
214.725(3)
(3) An examination shall include a review of all of the following:
214.725(3)(a)
(a) Quality of financial condition, including safety and soundness and investment and loan quality.
214.725(3)(b)
(b) Compliance with this chapter and other applicable state laws and rules and federal laws and regulations.
214.725(3)(d)
(d) Overall safety and soundness of the savings bank, its parent savings bank holding company, savings bank subsidiaries, service corporations and affiliates.
214.725(3)(e)
(e) Remedial actions required to correct and to restore compliance with applicable statutes, regulations, rules and orders.
214.725(3)(f)
(f) Any other matter the division considers to be appropriate.
214.725(4)
(4) If a savings bank, its savings bank holding company or any of its savings bank subsidiaries or service corporations has not been audited at least once in the 12 months before the division's examination, the division shall order an audit of the entity's books and records to be made by an independent certified public accountant, selected by the division, who has experience in financial institution audits. The cost of the audit shall be paid for by the entity being audited.
214.725(5)
(5) Employes of the division or other designated agents may administer oaths and examine and take and preserve testimony under oath as to anything in the affairs or ownership of the savings bank or the entity examined.
214.725(6)
(6) An examination report may contain directives to correct violations or to perform acts to ensure the safety and soundness of the savings bank or the entity examined.
214.725(7)
(7) If a savings bank fails to submit to an examination, the division shall report that failure to the attorney general, who shall institute proceedings to revoke its certificate of incorporation.
214.725 History
History: 1991 a. 221;
1995 a. 27.
214.735
214.735
Examination report. Upon completion of an examination, the division shall provide an examination report to the board of directors of the savings bank or other entity examined. Each director shall read the report and shall sign an affidavit affirming that the director has read and understands the report. The affidavits shall be retained by the savings bank or entity examined and may be examined by the division.
214.735 History
History: 1991 a. 221;
1995 a. 27.
214.74
214.74
Orders of the division. 214.74(1)
(1) If the affairs of the savings bank, savings bank subsidiary, service corporation or affiliate or savings bank holding company are not being conducted in accordance with this chapter, the division may require the directors, officers and employes to take necessary corrective action. If the necessary corrective action is not taken, the division may issue an order to the directors of the entity, to be served personally or by certified mail, specifying a date for the performance of the corrective action.
214.74(2)
(2) If the order contains a finding that the business of the savings bank or savings bank holding company is being conducted in a fraudulent, illegal, unsafe or unsound manner or that the violation or the continuance of the practice to be corrected may cause insolvency, substantial dissipation of assets or earnings or the impairment of capital, the savings bank or savings bank holding company shall comply with the order immediately, unless the order is modified or withdrawn by the division or modified or terminated by a court. Notwithstanding
sub. (3), the division may apply to the circuit court in the county in which the home office of the savings bank or savings bank holding company is located for enforcement of an order.
214.74(3)
(3) If a hearing before the review board has not been requested within 20 days after service of an order, the division may, at any time within 90 days after the date specified in the order for an action to be taken or discontinued, commence an action in the circuit court of the county in which the home office of the savings bank or savings bank holding company is located to compel the directors, officers or employes to take required corrective action. If a hearing is requested pursuant to
s. 214.78, the division may institute suit within 90 days after a determination by the review board.
214.74(4)
(4) This section is in addition to the enforcement authority of the division under
subch. XII.
214.74 History
History: 1991 a. 221;
1995 a. 27.
214.745
214.745
Division's notice to members or stockholders. The division may prepare a statement of the condition of the savings bank, affiliate, savings bank subsidiary, service corporation or savings bank holding company and may mail the statement to the members or stockholders or may publish the statement as a class 1 notice under
ch. 985. The expense of a mailing or publication shall be paid by the savings bank, affiliate, savings bank subsidiary, service corporation or savings bank holding company.
214.745 History
History: 1991 a. 221;
1995 a. 27.
214.75
214.75
Record keeping and retention. 214.75(1)
(1) A savings bank shall maintain books and records, as required by the division, in accordance with generally accepted accounting principles and the requirements of its deposit insurance corporation. All books and records shall be current, complete, organized and accessible to the division's agents and examiners and to the savings bank's auditors and accountants.
214.75(2)
(2) A savings bank employing an outside data processing service shall inform the division at the initiation, renewal or changing of a contract for data processing services with an outside data processing service. The contract shall be submitted to the division at least 60 days before its implementation. The contract shall provide that the records maintained shall at all times be available for examination and audit by the division. A savings bank shall implement internal control and security measures for its data processing activities.
214.75(3)
(3) The division may examine any data processing center that provides data processing or related services to a savings bank as often as the division examines the savings bank it serves.
214.75(4)
(4) The division shall by rule prescribe periods of time for which savings banks must retain records and after the expiration of which, the savings bank may destroy those records. Liability may not accrue against the savings bank, the division or this state for destruction of records according to rules of the division promulgated under this subsection. In an action in which records of the savings bank may be called in question or demanded, a showing of the expiration of the retention period shall be sufficient excuse for failure to produce the records.
214.75(5)(a)(a) A savings bank may cause records kept by the savings bank to be recorded, copied or reproduced by any photostatic, photographic or miniature photographic process or by optical imaging if the process employed correctly, accurately and permanently copies, reproduces or forms a medium for copying, reproducing or recording the original record on a film or other durable material. A savings bank may thereafter dispose of the original record after obtaining the written consent of the division. This subsection, except that part requiring written consent of the division, is applicable to federal savings banks if it does not contravene federal law.
214.75(5)(b)
(b) Any photographic, photostatic or miniature photographic copy or reproduction or copy reproduced from a film record or any copy of a record generated by optical disk storage of a savings bank record shall be considered to be an original record for all purposes and shall be treated as an original record in all courts or administrative agencies for the purpose of its admissibility in evidence. A facsimile, exemplification or certified copy of a photographic copy or reproduction, copy reproduced from a film record or copy generated from optical disk storage of a record shall, for all purposes, be considered to be a facsimile, exemplification or certified copy of the original record.
214.75 History
History: 1991 a. 221,
280;
1995 a. 27.
214.755
214.755
Disclosure of examination reports and other records. 214.755(1)(1) Employes of the division and members of the review board may not disclose information gathered by examination of or obtained through reports from a savings bank or from a state or federal financial institution regulatory authority except to any of the following:
214.755(1)(a)
(a) Directors, officers or employes of the savings bank if required to administer this chapter.
214.755(1)(b)
(b) A state or federal financial institution regulatory authority if the regulatory authority agrees to keep the information confidential.
214.755(1)(c)
(c) A court, or law enforcement or prosecutorial agencies for use in investigating or prosecuting a crime involving that information.
214.755(1)(d)
(d) The savings bank's independent certified public accountants.
214.755(1)(e)
(e) The savings bank's deposit insurance corporation.
214.755(1m)
(1m) The officers or employes of a savings bank may not disclose the contents of an examination report except to any of the following:
214.755(1m)(a)
(a) A court, or law enforcement or prosecutorial agencies for use in investigating or prosecuting a crime involving the contents of the report.
214.755(1m)(b)
(b) The savings bank's attorneys, independent certified public accountants or other professional advisers.
214.755(2)
(2) An individual who violates
sub. (1) or
(1m) shall forfeit his or her office or position.
214.755 History
History: 1991 a. 221;
1995 a. 27,
103.
214.76(1)(1) At least once in each year and not more than 12 months after its last audit, a savings bank shall cause its books, records and accounts to be audited by an independent certified public accountant not connected with the savings bank. The certified public accountant shall conduct the audit to produce a certified financial statement. The division may require additional information to be included in an audit report.
214.76(2)
(2) The accountant shall deliver the audit report to a committee composed of 3 or more members of the board of directors, none of whom may be an officer, employe or agent of the savings bank. The committee shall present the nature, extent and conclusions of the report at the next meeting of the board of directors. A written summary of the committee's presentation, together with a copy of the audit report and a list of all criticisms made by the accountant conducting the audit and any response of any member of the board of directors or any officer of the savings bank, shall be personally served or sent by certified mail to all members of the board of directors.
214.76(3)
(3) A copy of the audit report, including a balance sheet of the savings bank on the date of the audit and a statement of income and expenses of the savings bank during the year ending with the date of the audit and the written summary prepared for the board of directors shall be filed with the division within 60 days after the date on which the savings bank received the audit report. The division may, for good cause shown, extend the filing date for up to 60 additional days.
214.76(4)
(4) The audit report filed with the division shall be certified by the accountant conducting the audit. If a savings bank fails to cause an audit to be made, the division shall order an audit to be made by an independent certified public accountant at the savings bank's expense. Instead of the audit required under
sub. (1), the division may accept an audit or portion of an audit made exclusively for a deposit insurance corporation or for a financial regulator of another state if the home office of the savings bank is located in that state.
214.76(5)(a)(a) Annually, no later than February 1, a savings bank shall file with the division a report of its activities of the preceding calendar year, upon forms prescribed by the division. The report shall include all of the following:
214.76(5)(a)1.
1. A verified copy of a statement of condition as of the close of December 31 of the preceding calendar year.
214.76(5)(a)2.
2. A statement of its operations during the preceding calendar year.
214.76(5)(b)
(b) A savings bank shall include with its annual report a copy of a statement of condition and operations as of the end of the savings bank's most recent fiscal year, which shall be available to the public. The statement shall contain such information as the division requires.
214.76 History
History: 1991 a. 221,
315;
1995 a. 27,
325.
214.765
214.765
Unsafe and unsound practices; orders of prohibition and removal. 214.765(1)
(1) A violation of
subch. VI or
VII or s.
214.34,
214.59 or
214.76, or the failure to comply with recommendations of an examination report of the division within 60 days after the date of issuance of the report or within any other period the division specifies, shall be considered an unsafe and unsound practice and creates an unsafe and unsound condition in the savings bank. A savings bank or a person affiliated with a savings bank who violates these provisions shall be subject to a forfeiture under
s. 214.935 and to other enforcement powers of the division under this subchapter,
subch. XII and rules of the division.
214.765(2)
(2) Continued violation of any provision in
sub. (1) after the division issues an order to correct shall subject the members of the board of directors of the savings bank to removal from the board and to a permanent order of prohibition under
s. 214.91.
214.765(3)
(3) The division shall promulgate rules to implement this section.
214.765 History
History: 1991 a. 221;
1995 a. 27.
214.772
214.772
Foreign savings banks. 214.772(1)
(1) In this section, "foreign savings bank" means a savings bank organized under the laws of another state or territory. "Foreign savings bank" does not include a federal savings bank.
214.772(2)
(2) A foreign savings bank is doing business in this state if it accepts funds for deposit accounts in this state, takes loan applications in this state in the regular course of business or otherwise engages in any activity which would, if engaged in by a domestic entity, require that entity to be organized under this chapter as a savings bank. A foreign savings bank is not considered to be doing business in this state solely because it does one or more of the following:
214.772(2)(a)
(a) Makes a mortgage loan in this state, purchases a loan secured by real property located in this state or otherwise acquires an interest in real property located in this state.
214.772(2)(b)
(b) Holds or disposes of any interest in real property located in this state.
214.772(2)(c)
(c) Pursues its rights or remedies in this state as the owner of real estate or under the terms of a real estate mortgage or similar security interest.
214.772(3)
(3) The activities in this state that a foreign savings bank may engage in are limited to those activities that a savings bank may engage in, and are subject to the laws of this state to the same extent as those activities conducted by a savings bank. A foreign savings bank may not do business in this state without a certificate of authority issued under this section.
214.772(4)(a)(a) An application by a foreign savings bank for a certificate of authority to do business in this state shall be accompanied by a nonrefundable $500 application fee and shall contain all of the following:
214.772(4)(a)1.
1. A certified copy of the foreign savings bank's articles of incorporation and bylaws.
214.772(4)(a)2.
2. The name and address of the person in this state who will serve as the foreign savings bank's agent under
sub. (6).
214.772(4)(a)3.
3. Satisfactory evidence that the foreign savings bank is in good standing with the regulatory authority responsible for its supervision in the jurisdiction in which the foreign savings bank is organized.
214.772(4)(a)4.
4. Satisfactory evidence of insurance by a deposit insurance corporation.
