CHAPTER 286

FORMERLY

SENATE BILL NO. 297

AN ACT TO AMEND TITLE 5 OF THE DELAWARE CODE RELATING TO BANKS AND OTHER FINANCIAL INSTITUTIONS.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF DELAWARE :

Section 1. Amend Title 5 of the Delaware Code by adding thereto a new §145, as follows:

"§145. Financial institution supervisory privilege.

(a) For purposes of this section, the following definitions shall apply:

(1) 'Confidential supervisory information' means any of the following information, or any portion of any such information, other than any ordinary business record, which is treated as, or considered to be, confidential information by the Commissioner, regardless of the medium in which the information is conveyed or stored:

a. Any report of examination and any information prepared or collected by the Commissioner or the Commissioner's designee in connection with the supervisory process, including any computer file, work paper, or similar document.

b. Any correspondence or communication from the Commissioner or the Commissioner's designee to a financial institution as part of an examination or otherwise in connection with the supervisory process.

c. Any correspondence, communication, or document, including any compliance and other reports, created by a financial institution in response to any request, inquiry, or directive from the Commissioner or the Commissioner's designee in connection with any examination or other supervisory process and provided to the Commissioner or the Commissioner's designee.

d. Any record of the Commissioner to the extent it contains information derived from any report, correspondence, communication or other information described above in subparagraph a., b., or c. of this subsection.

(2) 'Ordinary business record' means any book or record in the possession of the financial institution routinely prepared by the financial institution and maintained in the ordinary course of business or any information required to be made publicly available by any law or regulation of this State or of the United States.

(3) 'Supervisory process' means any activity engaged in by the Commissioner or the Commissioner's designee to carry out the official responsibilities of the Commissioner with regard to the regulation or supervision of financial institutions.

(b) All confidential supervisory information shall be the property of the Commissioner and shall be privileged and protected from disclosure to any other person and shall not be discoverable or admissible into evidence in any civil action; provided, however, that the Commissioner may waive, in whole or in part, in the discretion of the Commissioner, any privilege established under this section, except as otherwise provided in §125 of this title.

(c) No person in possession of confidential supervisory information may disclose such information, in whole or in part, without the prior authorization of the Commissioner, except for a disclosure made in published statistical material that does not disclose, either directly or when used in conjunction with publicly available information, the affairs of any person.

(d) The Commissioner may require any person in possession of confidential supervisory information to notify the Commissioner whenever the person is served with a subpoena, order, discovery request, or other judicial or administrative process requiring the personal attendance of such person as a witness or requiring the production of such information in any proceeding.

(e) In any proceeding in this State, in which a person seeks to compel production or disclosure by any person of any information or document prepared or collected by any bank regulatory or supervisory authority that would, had it been prepared or collected by or on behalf of the Commissioner, be confidential supervisory information for purposes of this section, such information or document shall be privileged to the same extent that confidential supervisory information is privileged in accordance with this section.

(f) The submission by a financial institution of any information to the Commissioner for any purpose in the course of the supervisory process shall not be construed as waiving, destroying, or otherwise affecting any privilege such institution may claim with respect to such information.

(g) A person seeking discovery or disclosure, in whole or in part, of confidential supervisory information may not seek to obtain such information through subpoena, discovery procedures, or other process from any person, except that such information may be sought in accordance with this section from the Commissioner, who shall determine in accordance with the standard established in §125 of this title and within a reasonable period of time whether to disclose such information.

(h) Notwithstanding any other provision of this section or §125 of this title, the Commissioner, without waiving any privilege, may authorize access to confidential supervisory information for any appropriate governmental, law enforcement, or public purpose, as determined by the Commissioner.”

Section 2. Amend §168 of Title 5 of the Delaware Code by inserting in the title thereof the words and punctuation "; authority for emergency acquisitions" after the word "Exceptions" and before the period, by designating all of the existing text of that section as subsection "(a)" thereof, and by adding thereto a new subsection "(b)", as follows:

"(b) Notwithstanding any other provision of this title, the Commissioner may approve the change of control of any Delaware chartered bank or trust company upon determining that the Delaware chartered bank or trust company is in default or in danger of default; provided, however, that the Delaware chartered bank or trust company has not been caused to be in default or in danger of default for the specific purpose of engaging in a change of control transaction pursuant to this subsection. For purposes of this subsection, the term ‘in danger of default’ with respect to a Delaware chartered bank or trust company means that, in the opinion of the Commissioner, the Delaware chartered bank or trust company is not likely to be able to meet the demands of its depositors or pay its obligations in the normal course of business and there is no reasonable prospect that it will be able to meet such demands or pay such obligations without assistance, or the Delaware chartered bank or trust company has incurred or is likely to incur losses that will deplete all or substantially all of its capital and there is no reasonable prospect that its capital will be replenished without assistance."

Section 3. Amend subsection (3) of §2702 of Title 5 of the Delaware Code by inserting the words and punctuation "federal savings bank, federal credit union or other person authorized by the laws of the United States to engage in the business of cashing checks, drafts or money orders in this State," after the words and punctuation "federal reserve bank," and before the words "or to any person".

Section 4. Amend subsection (a) of §2902 of Title 5 of the Delaware Code by deleting the words and punctuation "no state bank or trust company, or any national bank, authorized to do business in this State shall be required to obtain a license under this chapter but shall comply with all of the other provisions of this chapter" and inserting in lieu thereof the words and punctuation "the licensing requirements of this chapter shall not apply to any banking organization, federal credit union or insurance company, or any other person, if and to the extent that such person is engaging in the business of a sales finance company in this State in accordance with and as authorized by any other applicable law of this State or the United States,".

Section 5. Amend §2902 of Title 5 of the Delaware Code by adding thereto a new subsection "(h)", as follows:

"(h) The Commissioner shall be authorized to exempt from any or all of the provisions of this chapter such persons or classes of persons as the Commissioner shall find inappropriate to include within the coverage of this chapter in order to effectuate the purposes of this chapter. The Commissioner may by regulation establish procedures for application, fees and other requirements for an exemption pursuant to this subsection."

Section 6. If any provision of this Act or the application of any section or part thereof to any person or circumstance is held invalid, such invalidity shall not affect other provisions or applications of this Act that can be given effect without the invalid provision or application.

Section 7. The provisions of this Act shall be effective upon its enactment into law.

Approved April 18, 2000