Code of Massachusetts Regulations › 209 CMR - DIVISION OF BANKS AND LOAN AGENCIES › Title 209 CMR 33.00 - Conversion By Co-operative Banks And Savings Banks From Mutual To Stock Form › Section 33.27 - Issuance of Stock by Subsidiaries of Mutual Holding Companies

Current through Register 1525, July 5, 2024
(1)
Approval
			 Requirements
. No subsidiary banking institution of a mutual
			 holding company (including any resulting subsidiary banking institution or
			 acquiree subsidiary banking institution) may issue stock to persons other than
			 its mutual holding company parent inconnection with a mutual holding company
			 reorganization, or at any time subsequent to the subsidiary banking
			 institution's acquisition by the mutual holding company, unless the subsidiary
			 banking institution obtains approval of each such issuance from the
			 Commissioner. Any reference in
			 209 CMR
			 32.27 to a subsidiary banking institution
			 shall include a subsidiary holding company in the event of a stock issuance by
			 a subsidiary holding company. The Commissioner shall approve any proposed
			 issuance that meets each of the criteria set forth below in 209 CMR 33.27(1)(a)
			 to (i).
(a) The proposed issuance is to be
			 made pursuant to a Stock Issuance Plan that contains all the provisions
			 required by
			 209 CMR
			 33.28.
(b) The Stock Issuance Plan is consistent
			 with the terms of the subsidiary banking institution's Articles of Organization
			 (or any proposed amendments there to), including terms governing the type and
			 amount of stock that may be issued.
(c) The Stock Issuance Plan would provide the
			 subsidiary banking institution, its mutual holding company parent, and any
			 other subsidiaries of the mutual holding company with fully sufficient capital
			 and would not be inequitable or detrimental to the subsidiary banking
			 institution or to members of the mutual holding company parent.
(d) The proposed price or price range of the
			 stock to be issued is reasonable. The Commissioner shall review the
			 reasonableness of the proposed price or price range in accordance with 209 CMR
			 33.27(2).
(e) The aggregate amount
			 of outstanding common stock of the subsidiary banking institution owned or
			 controlled by persons other than the subsidiary banking institution's mutual
			 holding company parent at the close of the proposed issuance shall be less than
			 50% of the subsidiary banking institution's total outstanding common stock,
			 unless the subsidiary banking institution was a stock subsidiary banking
			 institution when acquired by the mutual holding company and is not a resulting
			 subsidiary banking institution or any acquiree subsidiary banking institution,
			 in which case the foregoing restriction shall not apply. Any amount of
			 preferred stock may be issued by any subsidiary banking institution of a mutual
			 holding company to persons other than the subsidiary banking institution's
			 mutual holding company, consistent with any other applicable laws and
			 regulations.
(f) The subsidiary
			 banking institution shall submit a business plan which details how the capital
			 raised from the proposed issuance of securities will be deployed, expected
			 earnings resulting from the issuance of stock, and such other information as
			 maybe required by the Commissioner. Such business plan shall be in a form
			 acceptable to the Commissioner.
(g)
			 The subsidiary banking institution shall furnish any information required by
			 the Commissioner in connection with the proposed issuance.
(h) Corporators or members have approved the
			 Stock Issuance Plan under 209 CMR (1)(c).
(i) The proposed issuance complies with all
			 other applicable laws and regulations.