Florida Administrative Code › 69 - DEPARTMENT OF FINANCIAL SERVICES › 69U - FSC - Financial Institution Regulation › Chapter 69U-105 - LICENSING AND CHARTERING OF FINANCIAL INSTITUTIONS › Section 69U-105.405 - Regulatory Standards for Evaluating Applications

Current through Reg. 50, No. 138; July 16, 2024
(1) Standards. In making its determination to
				approve or disapprove branch office applications, OFR shall consider the
				following criteria:
(a) The applicant has or
				agrees to provide sufficient capital accounts to support the state financial
				institution's deposit base, or in relation to the number and valuation of
				fiduciary accounts of the trust company, and the additional fixed asset
				proposal for such branch and its operations, without undue risk to its
				depositors or to its fiduciary account holders. Capital should equal or exceed
				the minimum level established by state or federal law or rule, whichever is
				greater, to be considered adequate. It should be noted, however, that other
				factors, including earnings, managerial capacity, asset condition, past
				performance, and degree of liquidity, among others, are important in assessing
				the overall capacity of a state financial institution to establish a branch
				office and may have an impact on the adequacy of capital. Therefore, OFR may
				require that the applicant provide additional capital as a condition of
				approval of the application. If the applicant is a proposed state financial
				institution or a state financial institution opened less than one year, OFR
				will normally require the state financial institution to increase its total
				capital accounts by an amount sufficient to support the additional costs
				associated with the start-up of a new branch office. These costs will include
				the cost of building or leasing of the office, additional overhead necessary
				until the branch office is profitable, and cover the minimum capital
				requirements on new branch office deposits.
(b) The applicant has sufficient earnings and
				earning prospects to support the anticipated expenses of such branch office,
				without jeopardizing the profitability position of the state financial
				institution, its retained earnings, or the dividend return to its shareholders.
				An annualized net profit to asset ratio of at least 0.5 percent for each of the
				four quarters preceding the application, is generally considered adequate to
				support the expansion for a branch office. The applicant will furnish to OFR
				supporting documentation of its compliance with the net profit to assets ratio
				as part of the application. In addition, major fluctuations in quarterly
				earnings used in the above calculation should be discussed as part of the
				application. The end of quarter figures as reported in the applicant's four
				most recent Consolidated Reports of Income will be used in computing compliance
				with this ratio. It should be noted, however, that factors such as liquidity,
				asset condition, managerial capacity, past performance, among others, are
				important in assessing the overall capacity of a state financial institution to
				establish a branch office and may, therefore, have an impact on the relative
				significance of a net profit to asset ratio above or below 0.5 percent. With
				respect to proposed state financial institutions or state financial
				institutions opened less than one year, OFR will rely on its analysis of all
				data submitted with the application for authority to organize, with emphasis
				upon the information which relates to prospects for successful
				operation.
(c) The applicant has
				sufficient depth and quality of management to operate the branch office without
				reducing its current level of services, or exceeding its managerial or
				operational capacity. With respect to proposed state financial institutions or
				state financial institutions opened less than one year, the applicant shall
				demonstrate that management has employed experienced staff to operate branch
				offices. The individual who will be charged with the responsibility for
				managing the day-to-day operation of the branch office must be identified and a
				detailed resume of his/her past experience provided to OFR for its review prior
				to proposing an opening date for the branch office.
(d) The name of the proposed branch office
				reasonably identifies the branch office as such, and is not likely to unduly
				confuse the public.
(e) The
				applicant is in substantial compliance with applicable laws governing its
				operations. The existence of any supervisory board resolutions, administrative
				order, or written agreement with supervisory authorities relating to the state
				financial institution's operations is an indication that the state financial
				institution is not in substantial compliance with applicable laws governing its
				operations and may be grounds for denial of the
				application.