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| ## Comptroller of the Currency                                        |
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| > **Administrator of National Banks**                                 |
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Washington, D.C. 20219

######### Interpretive Letter #952

October 23, 2002 **February 2003**

**12 USC 21 - 23**

Mr. Scott A. Cammarn, Esq **12 USC 30B**

Associate General Counsel

Bank of America, National Association

101 South Tryon Street

Charlotte, North Carolina 28255

Dear Mr. Cammarn:

This is in response to your letter of October 4, 2002, on behalf of Bank
of America, National Association, Charlotte, North Carolina, ("Bank of
America" or "the Bank") requesting the views of the Office of the
Comptroller of the Currency (the "OCC") concerning the location of the
Bank for corporate status purposes in the national banking laws and in
determining the Bank's citizenship for federal diversity jurisdiction
under 28 U.S.C. §§ 1332 & 1348. As explained below, we believe the
corporate location of the Bank is determined by the place where the
Bank's main office is currently located (Charlotte, North Carolina), not
the place where it was located in the Bank's historical organization
certificate (San Francisco, California).

**Background**

Bank of America, N.A., is the result of an interstate merger that
occurred in 1999. In that merger, NationsBank, N.A., Charlotte, North
Carolina, (Charter Number 14448) was merged into the Bank of America
National Trust & Savings Association, San Francisco, California,
(Charter Number 13044). Charter Number 13044 survived the merger. The
historical organization certificate for Charter Number 13044, executed
by the organizing directors of the Bank of Italy National Trust and
Savings Association on February 26, 1927, stated that its original place
of business was San Francisco, California. In the 1999 merger, however,
the resulting bank retained the main office of NationsBank in Charlotte
as its main office, as it was authorized to do under 12 U.S.C.
§ 1831u(d)(1).[^1] Hence, the main office of Charter Number 13044 today
is in Charlotte. The resulting bank also changed its name to Bank of
America, N.A.

**Corporate Location of a National Bank under the National Bank Act**

The location of a national bank for corporate status purposes under the
National Bank Act and other banking laws is determined by the place
where the national bank's main office is located. As explained below, at
the time of chartering, the main office is located in the place
designated in the bank's organization certificate and original articles
of association. Subsequently, if the bank changes the location of its
main office to a new place, then the new location determines the
location of the bank for corporate status purposes. Such changes of
location are evidenced in the bank's articles of association, since the
articles must be amended to reflect the change of the main office to a
new place.

When organizers propose to form a national bank, they apply to the OCC.
Among the materials and information they must submit are an organization
certificate and articles of association. 12 U.S.C. §§ 21-23. The
articles of association and the organization certificate are typically
prepared at the same time at the first meeting of the organizers and
sent to the OCC together. *See Comptroller's Corporate Manual, Corporate
Organization* at 19-20 (April 1998) (sample minutes for first meeting of
organizers). Both the organization certificate and the articles contain
the name of the proposed bank, its location, and the amount and
structure of its capital stock.[^2] In particular, both documents will
include "\[t\]he place where its operations of discount and deposit are
to be carried on, designating the State, Territory, or District, and the
particular county and city, town, or village." 12 U.S.C. § 22(Second).

The national bank's "main office" (a term used in 12 U.S.C. § 30(b) and
other banking statutes) is located within the "city, town, or village"
designated as the "place where its operations of discount and deposit
are to be carried on." Indeed, for location purposes, the "main office"
and the "place where its operations of discount and deposit are to be
carried on" are the same. Section 30(b) now uses the term "main office."
But when originally enacted in 1886, the provisions now codified in
12 U.S.C. § 30(b) used the same terminology as section 22:

> SEC. 2. That any national banking association may change its name or
> the place where its operations of discount and deposit are to be
> carried on, to any other place within the same State, not more than
> thirty miles distant with the approval of the Comptroller of the
> Currency, by the vote of shareholders owning two-thirds of the stock
> of such association.

Act of May 1, 1886, ch. 73, § 2, 24 Stat. 18 (1886). When the statute
was amended in 1959, the provision limiting moves to places within the
same state was removed, and the new term "main office," was introduced.
Pub. L. No. 86-230, § 3, 73 Stat. 457 (1959). [^3]

Another relevant provision is 12 U.S.C. § 81. Under section 81, the
"general business of each national banking association shall be
transacted in the place specified in its organization certificate and in
the branch or branches, if any, established or maintained by it" under
12 U.S.C. § 36. When section 30 was added allowing changes in location
and then amended to refer to the main office, an apparent inconsistency
with section 81 was created, inasmuch as section 30 allowed the bank to
move to a new place and even to cease operations in the old place, but
section 81 continued to refer only to the place specified in the
organization certificate. The OCC addressed the inconsistency by
concluding that the "place specified in its organization certificate" in
section 81 "is meant to include not only the place originally specified
in the organization certificate but also subsequent changes of location
as authorized under section 30." *OCC Bank Midwest Decision* at page 13,
note 5. Thus, for location purposes, the terms are interchangeable. The
main office defines the place, because the place is the city or town
(and state) within which the main office is located.

While many national banks continue to operate at the place originally
designated, a national bank can change its place of operations under
other statutory authority. Under 12 U.S.C. § 30(b), a national bank may
change the location of its main office to another location within the
original city or to another location outside the original city, but
within 30 miles of the city limits of the original city. Once the bank
moves its main office outside its original city, the bank is now located
at the new place, and the old place is no longer the place where its
banking operations are carried on, in the section 22 sense, even if it
retains branches in that city.[^4] Moreover, a national bank can change
the location of its main office into a new state.[^5] It can do so
without retaining any branches or other operations in its original
state.

A national bank may also change the location of its main office in the
context of an interstate merger with another bank under the Riegle-Neal
Act. Under 12 U.S.C. § 215a-1 and 1831u(a), an insured national bank may
merge with another insured bank with a different home state. When such a
merger occurs, the resulting bank may retain, as its main office, any
office that any bank involved in the merger was operating as a main
office or a branch immediately before the merger. 12 U.S.C.
§ 1831u(d)(1). In other words, the resulting bank may designate as its
main office, any one of main offices or branches of any of the banks in
the merger, including a main office or branch in a state other than the
state in which the acquiring bank's former main office was located. Bank
of America, N.A., is the result of such an interstate merger.

If a national bank's main office is changed to a different place (a
different city, town, or village), that change must be reflected in the
articles of association.[^6] But there is no statutory provision or
regulatory procedure to change the organization certificate to reflect
current conditions. It is a fixed historical document that was used in
the organizing process but is not used subsequent to the issuance of the
charter by the OCC and, therefore, has no reason to reflect the current
status of the institution.[^7]

When a national bank has changed the location of its main office to a
new place, it is the new place that determines the bank's location for
corporate purposes. Moreover, the location of a national bank, and in
particular the location of its main office, is a factor in determining
the applicability of many banking statutes. Some of the statutes use the
location as a reference point for a substantive provision of federal
law. Others use the location to determine which state's law is made
applicable to the national bank by federal law. In all these
determinations, the place used is the location of the current main
office as shown in the bank's current articles of association, not the
place designated in the organization certificate and the original
articles.[^8] For example, in the OCC's recently adopted regulation
addressing electronic activities, the rule specifies the manner to
determine the location, for purposes of 12 U.S.C. § 85, of a national
bank that operates exclusively through the Internet. It provides that
the main office of such a bank is "the office identified by the bank
under 12 U.S.C. 22(Second) or as relocated under 12 U.S.C. 30 or other
appropriate authority." *See* 67 Fed. Reg. 34992, 35006 (May 17, 2002)
(to be codified at 12 C.F.R. § 7.5009).

Finally, when Congress had occasion to identify a national bank's home
state, it used the location of the bank's main office as the reference
point. In the Riegle-Neal Act, Congress authorized mergers between
insured banks with different home states. The "home state" of a national
bank is the state in which its main office is located. 12 U.S.C.
§ 1831u(g)(4)(A)(i). Moreover, the home state of a state bank is the
state by which the bank is chartered. 12 U.S.C. § 1831u(g)(4)(A)(ii).
This suggests Congress viewed the main office of a national bank as a
way to designate a state that was comparable to the state of
incorporation for a state bank.

**Location of a National Bank for Federal Court Jurisdiction**

For purposes of diversity jurisdiction in federal courts, "\[a\]ll
national banking associations shall, for the purposes of all other
actions by or against them, be deemed citizens of the States in which
they are respectively located." 28 U.S.C. § 1348.

Over the years, the courts have taken three positions regarding the
location of a national bank for diversity purposes. Recently, some
district courts adopted the position that a national bank was located
in, and hence a citizen of, every state in which it maintains a branch
or otherwise has a substantial presence.[^9] On the other hand, an older
court of appeals decision and some district courts took the position
that a national bank was located for this purpose only in the state of
its principal place of business.[^10]

However, the leading recent court of appeals case followed neither of
those approaches. In *Firstar Bank, N.A. v. Faul,* 253 F.3d 982 (7^th^
Cir. 2001), the Seventh Circuit, relying upon the history and context of
the provision, determined the national bank jurisdiction statute should
be construed to maintain jurisdictional parity between national banks
and state banks or other state corporations. 253 F.3d at 987-93.[^11]
For diversity jurisdiction purposes, state banks and other state
corporations are potentially citizens of two states --- the state of
incorporation and the state where it has its principal place of
business. *See* 28 U.S.C. § 1332(c)(1). And so the court concluded that
national banks should be similarly treated. Since a national bank is not
incorporated by a state, the court looked to the state designated in a
national bank's organization certificate to serve as an analogue and
concluded that a national bank is a citizen, for jurisdiction purposes,
both of the state of its principal place of business and the state
listed in its organization certificate. 253 F.3d at 993-94.

We believe the interpretation of the statute and fundamental reasoning
of the *Firstar Bank, N.A. v. Faul* court are correct. National banks
are to be treated for diversity jurisdiction purposes in a manner
similar to state banks. However, the court's use of the state listed in
the organization certificate as the analogue to the state of
incorporation was incomplete. While most national banks do not change
the location of their main office from the state originally listed in
the organization certificate, some do. As set out above, the state that
was listed in the original organization certificate can be changed under
statutes that provide for changing the location of the main office. When
this occurs, the original organization certificate document itself is
not changed. The change in designation of the place of operations
(including state) is reflected in other documents, particularly the
articles of association.[^12]

Thus, a more complete statement of the position would be that a national
bank is a citizen of the state in which its principal place of business
is located and of the state that was originally designated in its
organization certificate and articles of association or, if applicable,
the state to which that designation has been changed under other
authority (*i.e.,* the state in which its main office is currently
located). We think this better comports with the underlying national
bank corporate statutes and practice. It is also consistent with the
reasoning in *Firstar Bank, N.A. v. Faul.* A national bank's change of
its original designated state is akin to a state entity changing its
state of organization by reincorporating in a new state. Moreover, if
only the state actually listed in the original organization certificate
is used, without some method to take account of later changes of main
office, that could lead to the result of a national bank being deemed a
citizen of a state with which it no longer had any contacts whatsoever.

**Conclusion**

Accordingly, we conclude that, since Bank of America's main office is
now in Charlotte, North Carolina, the Bank should be treated as a
citizen of North Carolina for that part of the test in *Firstar Bank,
N.A. v. Faul.*

Very truly yours,

Eric Thompson

Eric Thompson

Director

Bank Activities & Structure

[^1]: *See* *Decision to Merge Bank of America National Trust & Savings
    Association, San Francisco, California, and NationsBank, N.A.,
    Charlotte, North Carolina* (OCC CRA Decision No. 94, May 20, 1999).

[^2]: 12 U.S.C. § 22 (organization certificate); *Comptroller's
    Corporate Manual, Corporate Organization* at 33-35 (April 1998)
    (instructions for organization certificate and sample document);
    *Comptroller's Corporate Manual, Corporate Organization* at 21-32
    (April 1998) (instructions for articles of association and sample
    document).

[^3]: *See generally Decision on the Applications of Bank Midwest of
    Kansas, N.A., Lenexa, Kansas, and Bank Midwest, N.A.. Kansas City,
    Missouri* (OCC Corporate Decision No. 95-05, February 16, 1995)
    (pages 12-18), *reprinted in* Fed. Banking L. Rep. (CCH) ¶ 90,474
    (discussion of sections 22, 30, and 81).

[^4]: In the organization certificate and original articles, even if a
    bank proposes to have branches in several cities upon opening, only
    one place is the place designated in section 22 and the articles.
    The articles will also refer to conducting business at authorized
    branches. In this regard, it is important to note that the main
    office is primarily a term of legal, rather than business,
    significance. It is the office designated as such. The bank must
    carry on the business of banking at its main office, but the main
    office need not be the office at which the bank conducts the
    principal portion, or any required minimum portion, of its business.
    *See OCC Bank Midwest Decision* at page 12. *See also Ramapo Bank v.
    Camp,* 425 F.2d 333, 341-42 (3d Cir. 1970).

[^5]: ^?^ *See, e.g., Synovus Financial Corporation v. Board of
    Governors of the Federal Reserve System,* 952 F.2d 426 (D.C. Cir.
    1991) (moving main office into new state under section 30, keeping
    no branches in old state); *McEnteer v. Clarke,* 644 F.Supp. 290
    (E.D. Pa. 1986) (same). *See also OCC Bank Midwest Decision, supra*
    (moving main office into new state, and keeping branches in old
    state).

[^6]: *See* 12 U.S.C. § 21a (authorizing amendments to articles of
    association); 12 C.F.R. § 5.40(d)(2)(ii) (amendment of articles if
    main office location is changed outside original city, town, or
    village). Similarly, when other items that were included in the
    organization certificate and original articles are changed, the
    articles of association must be amended to reflect the changes.
    *See* 12 C.F.R. § 5.42(d)(2) (amendment of articles for change of
    name); 12 C.F.R. § 5.46(g)(2) & 5.46(i)(3)(iv) (amendments of
    articles for changes in capital stock).

[^7]: *Compare* *Comptroller's Corporate Manual, Corporate Organization*
    at 21 (instructions for articles include directions regarding
    amendment) *with* *Comptroller's Corporate Manual, Corporate
    Organization* at 33 (instructions for organization certificate cover
    only original filing). *See also Decision on the Applications of
    American Security Bank, N.A., Washington, D.C., and Maryland
    National Bank, Baltimore, Maryland* (OCC Corporate Decision No.
    94-05, February 4, 1994) (at page 11, note 4), *reprinted in* Fed.
    Banking L. Rep. (CCH) ¶ 89,695. In addition, the Certificate of
    Corporate Existence the OCC issues to a national bank, when
    requested, to certify it is a national bank formed under the laws of
    the United States and authorized to transact the business of banking
    on the date of the Certificate lists the location of the bank at the
    main office on the date of the Certificate, not the original
    location in the organization certificate. The Certificates the OCC
    has issued to Bank of America (Charter Number 13044) since the 1999
    merger show Charlotte, North Carolina, as the Bank's location.

[^8]: For some statutes, a national bank may also be "located" in states
    in which it has branches. That is a separate matter from the issue
    here whether the current main office or the original place is the
    place used when referring to a bank's location.

[^9]: The first case to adopt that position was *Connecticut National
    Bank v. Iacono,* 785 F.Supp. 30 (D.R.I. 1992). Others have followed
    it. *See, e.g., Ferraiolo Construction, Inc. v. KeyBank, N.A.,* 978
    F.Supp. 23 (D. Me. 1997); *Norwest Bank Minnesota, N.A. v. Patton,*
    924 F.Supp. 114 (D. Colo. 1996); *Bank of New York v. Bank of
    America,* 861 F.Supp. 225 (S.D.N.Y. 1994).

[^10]: *American Surety Company v. Bank of California, N.A.,* 133 F.2d
    160 (9^th^ Cir. 1943); *Baker v. First American National Bank,* 111
    F.Supp.2d 799 (W.D. La. 2000); *Financial Software Systems, Inc. v.
    First Union National Bank,* 84 F.Supp.2d 594 (E.D. Pa. 1999).

[^11]: The OCC filed an amicus brief in *Firstar Bank, N.A. v Faul,*
    arguing in support of the position that section 1348 should be
    interpreted in a manner to achieve jurisdictional parity with state
    entities.

[^12]: In *Firstar Bank, N.A. v. Faul,* the city and state of the bank's
    main office (Cincinnati, Ohio) was the same as it was when the bank
    was chartered in 1863 as The First National Bank of Cincinnati
    (Charter Number 24). Thus, the facts in the case did not present the
    issue raised by a subsequent change in the designation of the place
    of operations.