2023 Connecticut General Statutes › Title 36a - The Banking Law of Connecticut › Chapter 666 - Out-of-State Banks › Section 36a-411. (Formerly Sec. 36-553). - Out-of-state holding companies: Powers re interstate acquisitions and establishment of banks and Connecticut holding companies.

Any out-of-state holding company may, with the approval of the commissioner, acquire and retain direct or indirect ownership or control of ten per cent or more of the voting stock of any bank, provided such bank has been in existence and continuously operating for at least five years, unless the commissioner waives this requirement, or Connecticut holding company, provided the subsidiary banks of such holding company have been in existence and continuously operating for at least five years, unless the commissioner waives this requirement or establish a bank. The commissioner may approve such acquisition or establishment only if the laws of the home state of such out-of-state holding company authorize, under conditions no more restrictive than those imposed by the laws of this state, as determined by the commissioner, a Connecticut holding company to establish or acquire and retain direct or indirect ownership or control of ten per cent or more of the voting stock of out-of-state banks or out-of-state holding companies whose home state is such state. The acquisition or establishment shall not take place if such out-of-state holding company, including all insured depository institutions which are affiliates of the out-of-state holding company, upon consummation of the acquisition or establishment, would control thirty per cent or more of the total amount of deposits of insured depository institutions in this state, unless the commissioner permits a greater percentage of such deposits. Before approving any such establishment or acquisition, the commissioner shall consider whether such establishment or acquisition can reasonably be expected to produce benefits to the public and whether such benefits clearly outweigh possible adverse effects, including, but not limited to, an undue concentration of resources and decreased or unfair competition. The commissioner shall not approve such acquisition or establishment unless the commissioner considers whether: (1) The investment and lending policies of the bank to be acquired, or the proposed investment and lending policies of the bank to be established, are consistent with safe and sound banking practices and will benefit the economy of this state; (2) the services or proposed services of the bank to be acquired or established are consistent with safe and sound banking practices and will benefit the economy of this state; (3) the acquisition or establishment will not substantially lessen competition in the banking industry of this state; and (4) in the case of such establishment or an acquisition and retention of ownership or control of twenty-five per cent or more of such voting stock, the out-of-state holding company (A) has sufficient capital to ensure, and agrees to ensure, that the bank to be acquired or established will comply with applicable minimum capital requirements, and (B) has sufficient managerial resources to operate the bank to be acquired or established in a safe and sound manner. The commissioner shall not approve such acquisition or establishment unless the commissioner makes the findings required by section 36a-34. Any such establishment or acquisition by an out-of-state holding company shall be effected in accordance with the laws of this state applicable to such activities when conducted by Connecticut holding companies.
(P.A. 83-411, S. 2, 20; P.A. 88-174, S. 2; 88-224, S. 1; P.A. 89-132, S. 2, 6; P.A. 90-2, S. 2, 20; P.A. 91-189, S. 8, 13; P.A. 92-17, S. 6, 7; P.A. 93-24, S. 5, 9; 93-59, S. 7, 8; P.A. 94-122, S. 186, 340; P.A. 95-155, S. 26, 29; P.A. 96-191, S. 2, 6.)
History: P.A. 88-174 added Subsec. (b) concerning New England savings and loan holding companies; P.A. 88-224 required the commissioner to use a balancing test before approving any establishment or acquisition and to adopt regulations; P.A. 89-132 amended Subsecs. (a) and (b) to allow rather than require the commissioner to order divestiture prior to March 30, 1990, and to require the commissioner to order divestiture after March 30, 1990; P.A. 90-2 changed New England bank holding company and New England savings and loan holding company to out-of-state bank holding company and out-of-state savings and loan holding company, provided for the establishment of new Connecticut financial institutions by out-of-state bank holding companies and savings and loan holding companies on and after February 1, 1992, added certain criteria for the commissioner of banking to consider prior to approving any acquisition or establishment, added certain findings to be made by the commissioner prior to granting such approval, provided that the regulations required under Subsec. (a) apply only to establishment or acquisition by a New England bank holding company, and deleted provisions re divestiture; P.A. 91-189 required the commissioner to consider whether the proposed acquisition or establishment will not substantially lessen competition in the banking industry, added provisions re considerations to be made by the commissioner in the case of purchase and retention of ownership or control of 25% or more of the voting stock of the Connecticut institution, added provisions re regulations concerning the commissioner's findings of records of compliance with community reinvestment and consumer protection requirements and made technical changes; P.A. 92-17 added Subsec. (c); P.A. 93-24 amended Subsec. (a) by deleting provision re adoption of regulations setting specific standards for the approval of any establishment or acquisition by a New England banking holding company for out-of-state banking holding companies, effective May 4, 1993; P.A. 93-59 made technical corrections to Subsec. (c), effective May 10, 1993; P.A. 94-122 deleted the community reinvestment provisions in Subsec. (a), deleted Subsec. (b) re out-of-state savings and loan holding companies, deleted Subsec. (c) as obsolete, made interstate banking law apply to acquisitions of 10% or more of a Connecticut bank's stock by an out-of-state holding company, specified that for foreign country banks that have already entered the U.S., reciprocity applies to the bank's home state under the federal International Banking Act, deleted the requirement that reciprocity laws of other states or foreign countries be “express”, deleted the reciprocity provision for de novo establishments of in-state banks by out-of-state holding companies, and made technical changes, effective January 1, 1995; Sec. 36-553 transferred to Sec. 36a-411 in 1995; P.A. 95-155 added provisos re five-year requirement, changed references from principal place of business and place of operations to home states, added restriction re controlling deposits, changed “institution” to “bank” and made technical changes, effective June 27, 1995; P.A. 96-191 made change re commissioner approval, and made clear that five-year existence requirement did not apply to establishment of a bank, effective June 3, 1996.