2023 Code of Alabama › Title 5 - Banks and Financial Institutions. › Chapter 3A - Examinations of Banks; Reports of Banks. › Article 1 - Examination of Banks. › Section 5-3A-1 - Required Times; Items to Be Examined; Applicability to Bank Holding Companies and Affiliates.

Section 5-3A-1
Required times; items to be examined; applicability to bank holding companies and affiliates.
(a) For purposes of this section, a bank holding company is a holding company organized under the laws of Alabama or another state in the United States that directly owns a majority of the voting securities of an Alabama state bank.
(b) Every bank other than national banks shall be subject to the supervision and inspection of the superintendent and the regulations and supervision thereof. The superintendent shall, by competent examiner appointed by him or her, visit and examine every bank organized under the laws of Alabama at least once in each eighteen-month period. The examination of banks shall be at irregular intervals. On every examination, inquiry shall be made as to the conditions and resources of the bank, the mode of conducting and managing the affairs of the bank, the action of its directors, the investment of the funds of the bank, the safety and prudence of the management of the bank, whether the requirements of its charter and of law have been complied with in the administration of the affairs of the bank, and such other matters as the superintendent may prescribe. In addition, the superintendent may in like manner examine or cause to be examined the affairs of every bank, every bank holding company, and every subsidiary or other affiliate or bank service company as defined pursuant to 12 U.S.C. §§1861-1867 of the bank or bank holding company, except a national bank or a subsidiary or other affiliate of a national bank, whenever, in the judgment of the superintendent, the management and condition of the bank, bank holding company, or the affiliates or bank service companies of either render an examination of the affairs of any of these entities necessary or expedient, or whenever the superintendent has reason to believe that a bank, bank holding company, or an affiliate or bank service company of either is not being operated in compliance with the laws of this state or in accordance with safe and sound banking practices.
(c) The term "affiliate" shall include any corporation, business trust, association, or other entity or organization under any of the following conditions:
(1) When a bank or a bank holding company, directly or indirectly, owns or controls either a majority of the voting shares or more than 50 percent of the number of shares voted for the election of the organization's directors, trustees, or other persons exercising similar functions at the preceding election, or controls in any manner the election of a majority of the organization's directors, trustees, or other persons exercising similar functions.
(2) When control of a bank or bank holding company is held, directly or indirectly, through stock ownership or in any other manner, by the shareholders of a bank or bank holding company who own or control either a majority of the shares of the bank or bank holding company or more than 50 percent of the number of shares voted for the election of directors of the bank or bank holding company at the preceding election, or by trustees for the benefit of the shareholders of the bank or bank holding company.
(3) When a majority of the directors of the bank or bank holding company comprise a majority of the directors, trustees, or other persons exercising similar functions of the organization.
(4) When the organization owns or controls, directly or indirectly, either a majority of the shares of capital stock of a bank or bank holding company or more than 50 percent of the number of shares voted for the election of directors of a bank or bank holding company at the preceding election, or controls in any manner the election of a majority of the directors of a bank or bank holding company at the preceding election, or controls in any manner the election of a majority of the directors of a bank or bank holding company, or for the benefit of whose shareholders or members all or substantially all the capital stock of a bank or bank holding company is held by trustees.
(Acts 1980, No. 80-658, §5-3-1; Acts 1997, No. 97-495, p. 885, §1; Act 2011-589, p. 1306, §1; Act 2013-352, p. 1261, §1.)