SB-0749, As Passed House, May 18, 2016

SUBSTITUTE FOR

SENATE BILL NO. 749

     A bill to amend 1999 PA 276, entitled

"Banking code of 1999,"

by amending section 1201 (MCL 487.11201).

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

Sec. 1201. As used in this act:

     (a) "Administrative expense" means any of the following:

     (i) An expense designated as an administrative expense by

under this act or by the court.

     (ii) Court costs and expenses of operation and liquidation of

a bank.

     (iii) Current wages paid to an employee of a bank whose

services are retained by the receiver for services rendered after

the date the bank is ordered in receivership.

     (iv) An unpaid expense of supervision or conservatorship of a

bank.

     (v) Unpaid fees or assessments owed to the bureau.department.

     (b) "Administrative procedures act of 1969" means the

administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to

24.328.

     (c) "Affiliate" means a corporation, business trust, limited

liability company, partnership, association, or similar

organization to which any of the following apply:

     (i) An organization, A person, directly or indirectly, owns or

controls either a majority more than 25% of its voting shares or

more than 50% of the number of a majority of the shares voted at

the most recent election for the election of its directors,

trustees, or other persons exercising individuals who exercise

similar functions, at the preceding election, or controls in any

manner the election of a majority of its directors, trustees, or

other persons exercising individuals who exercise similar

functions.

     (ii) Control of the organization is held, directly or

indirectly, through either 1 of the following:

     (A) Stock ownership or in any other manner, by the

shareholders or members of an organization who that own or control

a majority more than 25% of the shares of that organization, a

majority more than 25% of the ownership interest in the

organization, more than 50% of the number a majority of the shares

voted for the election of directors of that organization at the

preceding most recent election, or more than 50% a majority of the

ownership vote for election of directors of that organization at

the preceding most recent election.

     (B) By trustees for the benefit of the shareholders or members

of that organization.

     (C) By the power to exercise, directly or indirectly, a

controlling influence over the management or policies of the

organization, as determined by the commissioner after notice and an

opportunity for a hearing.

     (iii) A majority of its directors, trustees, or other persons

exercising individuals who exercise similar functions constitute a

majority of the directors, trustees, or other persons exercising

individuals who exercise similar functions of any 1 organization.

     (iv) The organization owns or controls, directly or

indirectly, either a majority more than 25% of the shares of

capital stock or other ownership interest of an organization, or

more than 50% of the number of a majority of the shares voted of

the total ownership vote for the election of directors of an

organization at the preceding election, or controls in any manner

the election of a majority of the directors of an organization, or

for the benefit of whose shareholders or members all or

substantially all the capital stock or ownership interest of an

organization is held by trustees.

     (d) "Applicant" means a person making that submits an

application under this act.

     (e) "Articles" means articles of incorporation, all amendments

to articles of incorporation, and agreements of consolidation and

merger.

     (f) "Association" means a federal savings association

organized under section 5 of the home owners' loan act, chapter 64,

48 Stat. 132, 12 U.S.C. 1464, 12 USC 1464, or a savings and loan

association, building and loan association, or homestead

association that is organized under the laws of a state, the

District of Columbia, or a territory or protectorate of the United

States, and whose deposits are insured by the federal deposit

insurance corporation.Federal Deposit Insurance Corporation.

     (g) "Bank" means a state banking corporation that is organized

or reorganized under this act or organized under any law of this

state enacted before the effective date of this act, March 1, 2000,

including a state banking corporation that voluntarily limits its

activities.

     (h) "Bank holding company" means a company as defined in the

bank holding company act that is not a bank or national banking

association and that is a bank holding company approved by the

board of governors of the federal reserve system Board of Governors

of the Federal Reserve System under the bank holding company act or

that will become an approved bank holding company before or upon

the completion of a consolidation provided in section 3706.

     (i) "Banking holding company act" means the federal bank

holding company act of 1956, chapter 240, 70 Stat. 133.12 USC 1841

to 1852.

     (j) "Branch" means, except as otherwise provided in this

subdivision, a branch bank, branch office, branch agency,

additional office, or a branch place of business at which deposits

are received, checks paid, or money lent. The acceptance of

deposits in furtherance of a school thrift or savings plan by an

officer, employee, or agent of a bank at a school shall not be

construed is not considered as the establishment or operation of a

branch. An electronic funds transfer facility that is made

available to 2 or more depository institutions under Michigan law

any law of this state that regulates electronic funds transfer

facilities is not a branch. A trust office of a bank is not a

branch. A loan production office is not a branch. An additional

office of a state agency is not a branch. An international banking

facility as defined in 12 C.F.R. CFR 204.8(a)(1), as in effect

December 31, 1982, is not a branch. The receipt of deposits by a

messenger service or the delivery by a messenger service of items

representing deposit account withdrawals or of loan proceeds is not

the establishment or operation of a branch, whether or not the

messenger service is owned or operated by the bank. Branch does not

include an agent acting under section 4101(1)(d).

     (k) "Bureau" or "department" means the financial institutions

bureau of the department of consumer and industry

services.department of insurance and financial services.

     (l) "Capital" or "capital stock" means the stated par value of

issued and outstanding unimpaired common stock and the stated par

value of issued and outstanding unimpaired preferred stock. For

purposes of sections 4202, 4301, 4307, and 4308, "capital" and

"capital stock" shall also include outstanding capital notes,

debentures, and any other instrument of indebtedness issued under

section 3801.

     (m) "Cease and desist order which has become final" or "order

which has become final" means a cease and desist order or an order

issued by the commissioner director with the consent of the

institution or the director board member or officer or other person

concerned, or with respect to which no a petition for review of the

action of the commissioner has been director was not filed and

perfected in a circuit court as specified in under section 2310(2),

or with respect to which the action of the court in which the

petition is filed is not subject to further review by the courts of

the state.

     (n) "Commissioner" or "director" means the commissioner of the

financial institutions bureau.director of the department.

     (o) "Consolidate", "consolidated", "consolidating", and

"consolidation" include, respectively, consolidate or merge,

consolidated or merged, consolidating or merging, and consolidation

or merger.

     (p) "Consolidated bank" means a bank that results from a

consolidation between a bank and 1 or more banks, out-of-state

banks, national banks, associations, or savings banks.

     (q) "Consolidated organization" means an out-of-state bank,

national bank, association, or savings bank organized under the

laws of another state or the United States that results from a

consolidation of 1 or more banks, with 1 or more out-of-state

banks, national banks, associations, or savings banks.

     (r) "Consolidating organizations" means any combination of

banks, out-of-state banks, national banks, associations, or savings

banks that have consolidated or are in the process of consolidation

as provided in section 3701 or 3702.

     (s) "Depository institution" means a bank, out-of-state bank,

national bank, foreign bank branch, association, savings bank, or

credit union organized under the laws of this state, another state,

the District of Columbia, the United States, or a territory or

protectorate of the United States.

     (t) "Derivative transaction" means any transaction that is a

contract, agreement, swap, warrant, note, or option that is based,

in whole or in part, on the value of, any interest in, or any

quantitative measure or the occurrence of any event relating to, 1

or more commodities, securities, currencies, interest or other

rates, indices, or other assets.

(u) (t) "Dissolution" means the process by which a solvent

bank voluntarily ends its corporate existence by liquidating its

assets and winding up its affairs.

(v) (u) "Dividend reinvestment plan" means a plan that is

offered solely to existing shareholders of the bank and which that

allows the shareholders to reinvest dividends received under

section 3806 in stock of the bank and that may allow additional

cash amounts to be contributed by the shareholders participating in

the reinvestment plan.

(w) (v) "Federal agency" means a foreign bank agency

established and operating under the international banking act of

1978.

(x) (w) "Federal branch" means a foreign bank branch

established and operating under the international banking act of

1978.

(y) (x) "Federal deposit insurance act" means the federal

deposit insurance act, chapter 967, 64 Stat. 873.12 USC 1811 to

1835a.

(z) (y) "Federal home loan bank act" means the federal home

loan bank act, chapter 522, 47 Stat. 725.12 USC 1421 to 1449.

(aa) (z) "Federal reserve act" means the federal reserve act,

chapter 6, 38 Stat. 251.12 USC 221 to 522.

     Enacting section 1. This amendatory act takes effect 90 days

after the date it is enacted into law.

     Enacting section 2. This amendatory act does not take effect

unless all of the following bills of the 98th Legislature are

enacted into law:

     (a) Senate Bill No. 748.

     (b) Senate Bill No. 750.