TITLE 5

Banking

Banks and Trust Companies

CHAPTER 8. ACQUISITION OF INTERESTS IN BANKING INSTITUTIONS; BANK HOLDING COMPANIES

Subchapter III. Acquisition of Delaware Savings Banks


For purposes of this subchapter, the following words and phrases shall have the meanings ascribed to them herein:

(1) "Acquire" or "acquisition" means:

a. The merger or consolidation of a savings and loan holding company with another savings and loan holding company or with a bank holding company;

b. The assumption by a savings institution, savings and loan holding company or bank holding company of direct or indirect ownership or control of the voting shares of a savings institution or savings and loan holding company if, after the effective date thereof, the savings institution, savings and loan holding company or bank holding company making the acquisition will directly or indirectly own or control more than 5 percent of any class of voting shares of the other savings institution or savings and loan holding company; or

c. The assumption of ownership or control of all or substantially all of the assets of a savings institution or savings and loan holding company.

(2) "Bank holding company" means a bank holding company as defined in the Bank Holding Company Act of 1956, as amended (12 U.S.C. § 1841 et seq.).

(3) "Commissioner" and "divest" shall have the meanings ascribed to them in § 801 of this title.

(4) "Control" shall have the same meaning as set forth in the Home Owners' Loan Act of 1933, as amended, at 12 U.S.C. § 1467a.

(5) "Delaware savings and loan holding company" means a savings and loan holding company located in Delaware which owns or controls a Delaware savings bank.

(6) "Delaware savings bank" means:

a. A savings bank organized and existing under the laws of this State that is not a "bank" as defined in § 842(1) of this title; or

b. A federal savings bank or federal savings association organized and existing under the Home Owners' Loan Act (12 U.S.C. § 1461 et seq.), which is located in Delaware.

(7) "Deposit" or "deposits" means:

a. When referring to a savings institution or a savings institution subsidiary of a savings and loan holding company or bank holding company, a "deposit" as defined in § 3(l) of the Federal Deposit Insurance Act, 12 U.S.C. § 1813(l); and

b. When referring to a bank subsidiary of a bank holding company, a "deposit" as defined in § 204.2(a) of Regulation D of the Federal Reserve Board (12 C.F.R. § 204.2(a)).

(8) "Location" or "located" means:

a. When referring to a savings and loan holding company, the state in which the amount of aggregate deposits in the United States offices of all of its directly or indirectly owned or controlled savings institution or nonsavings institution subsidiaries (as well as all of the savings institution or nonsavings institution subsidiaries of any savings and loan holding company which owns or controls that savings and loan holding company) is greatest;

b. When referring to a savings institution, the state in which the amount of aggregate deposits of all its offices in that state is greatest; and

c. When referring to a bank holding company, the state in which the amount of aggregate deposits in the United States offices of all of its directly or indirectly owned or controlled banking or savings institution or nonbanking or nonsavings institution subsidiaries (as well as all of the banking or savings institution or nonbanking or nonsavings institution subsidiaries of any bank holding company which owns or controls that bank holding company) is greatest.

(9) "Out-of-state bank holding company" shall have the meaning specified in § 801 of this title.

(10) "Out-of-state savings and loan holding company" means a savings and loan holding company located in a state other than Delaware.

(11) "Out-of-state savings institution" means a savings institution located in a state other than Delaware.

(12) "Savings and loan holding company" means a savings and loan holding company as defined in the Home Owners' Loan Act of 1933, as amended, at 12 U.S.C. § 1467a.

(13) "Savings institution" means a savings bank or savings and loan association chartered under the laws of any state, or a federal savings bank or federal savings association, the deposits of which are insured by the Federal Deposit Insurance Corporation.

(14) "Subsidiary" means, with respect to a savings institution, savings and loan holding company or bank holding company:

a. Any company 25 percent or more of whose voting shares is directly or indirectly owned or controlled by such savings institution, savings and loan holding company or bank holding company, or is held by it with power to vote; or

b. Any company the election of a majority of whose directors is controlled in any manner by such savings institution, savings and loan holding company or bank holding company.

66 Del. Laws, c. 33, § 3; 70 Del. Laws, c. 327, §§ 11-20; 71 Del. Laws, c. 25, § 21.;

(a) An out-of-state savings institution, out-of-state savings and loan holding company or out-of-state bank holding company, or any subsidiary of the foregoing, may acquire or retain ownership or control of a Delaware savings bank or a Delaware savings and loan holding company; provided, that the out-of-state savings institution, out-of-state savings and loan holding company or out-of-state bank holding company, or any subsidiary of the foregoing, makes application under and at all times complies with all regulations, decrees, cooperative agreements and orders duly promulgated by the Commissioner with respect to both the implementation of this subchapter generally, and the operations of such out-of-state savings institution, out-of-state savings and loan holding company or out-of-state bank holding company and the Delaware savings bank that it acquires specifically.

(b) The Commissioner may approve an acquisition, in accordance with subsection (a) of this section, even though the out-of-state savings institution, out-of-state savings and loan holding company or out-of-state bank holding company, or any subsidiary of the foregoing, that acquires a Delaware savings bank or a Delaware savings and loan holding company, would control, together with any affiliated insured depository institution (as defined in the Federal Deposit Insurance Act at 12 U.S.C. § 1813(c)), 30 percent or more of the total amount of deposits of insured depository institutions in this State. In determining whether to approve an acquisition pursuant to this subsection, the Commissioner shall consider the convenience and needs of the public of this State.

(c) Except as otherwise provided in this title or by applicable law of the United States, no out-of-state savings institution, out-of-state savings and loan holding company or out-of-state bank holding company, or any subsidiary of the foregoing, may acquire or retain ownership or control of a Delaware savings bank or a Delaware savings and loan holding company.

66 Del. Laws, c. 33, § 3; 70 Del. Laws, c. 327, § 21; 71 Del. Laws, c. 25, §§ 22-24.;

(a) An out-of-state savings institution, out-of-state savings and loan holding company or out-of-state bank holding company, or any subsidiary of the foregoing, shall make application to acquire a Delaware savings bank or a Delaware savings and loan holding company upon such forms and in accordance with such regulations and rulings as are promulgated from time to time by the Commissioner. Such application shall designate a resident of this State as the applicant's agent for the service of any paper, notice or legal process upon the applicant in connection with matters arising out of this subchapter and shall be accompanied by a nonrefundable filing fee in the amount of $5,750 for the use of the State, and a nonrefundable processing fee in such amount as the Commissioner shall from time to time fix by regulation, payable to and for the use of the Office of the Bank Commissioner.

(b) Following publication, notice and hearing in the manner prescribed by the Commissioner, the Commissioner shall approve or disapprove an application by an out-of-state savings institution, out-of-state savings and holding company or out-of-state bank holding company, or any subsidiary of the foregoing, to acquire or control a Delaware savings bank or a Delaware savings and loan holding company upon a determination of whether such acquisition will serve the public convenience and advantage. As part of such determination, but not by way of limitation, the Commissioner shall consider the following criteria:

(1) Whether the acquisition will, based upon the managerial and financial resources, financial history and business plan of the applicant, adversely affect the safe and sound operation of the Delaware savings bank or other savings institutions located in this State which are owned or controlled by the applicant;

(2) Whether the acquisition will adversely affect the quantity or quality of financial services available to 1 or more communities served by the Delaware savings bank prior to the acquisition;

(3) Whether, as a result of a prior or simultaneous acquisition of another Delaware savings bank, the acquisition of the Delaware savings bank will result in undue concentration of resources or a substantial lessening of competition in this State; and

(4) Whether the acquisition will foster economic development and the financing of business enterprises to the end that employment opportunities will either be increased or, where there is a prospect for a reduction, retained.

(c) In conjunction with the approval of any application filed under this section, the Commissioner may require as a condition of such approval that the out-of-state savings institution, out-of-state savings and loan holding company or out-of-state bank holding company enter into a cooperative agreement binding it to such special terms and conditions regarding its operations and its maintenance and preservation of the capital and assets in Delaware of the Delaware savings bank as the Commissioner shall deem to be necessary to assure that the acquisition serves the public convenience and advantage.

66 Del. Laws, c. 33, § 3; 68 Del. Laws, c. 303, § 17; 71 Del. Laws, c. 25, §§ 25-27.;

In order to effectuate the provisions of this subchapter, the Commissioner shall, in addition to exercising the authority provided in §§ 833 and 835 of this title:

(1) Adopt and issue such regulations, decrees, orders, rulings and forms, and enter into such cooperative agreements with out-of-state savings institutions, out-of-state savings and loan holding companies and out-of-state bank holding companies, or any subsidiaries of the foregoing, as he deems to be necessary and proper;

(2) Require by negotiation, administrative order or cooperative agreement the maintenance and production of such documents and reports, the periodic conduct of such examinations, and otherwise supervise and govern the activities of the out-of-state savings institution, out-of-state savings and loan holding company or out-of-state bank holding company as he deems necessary and proper;

(3) Have the authority to examine any out-of-state savings institution, out-of-state savings and loan holding company or out-of-state bank holding company which acquires a Delaware savings bank or a Delaware savings and loan holding company. The Commissioner may require reports of each out-of-state savings institution, out-of-state savings and loan holding company or out-of-state bank holding company which acquires a Delaware savings bank or Delaware savings and loan holding company in accordance with this subchapter. Such reports shall be filed under oath with such frequency and in such scope and detail as may be appropriate for the purpose of assuring continuing compliance with this subchapter and the safety and soundness of any Delaware savings bank;

(4) Prior to approving the acquisition of any Delaware savings bank or Delaware savings and loan holding company by an out-of-state savings institution, out-of-state savings and loan holding company or out-of-state bank holding company, the Commissioner may enter into cooperative agreements with the appropriate regulatory authorities for the periodic examination of any out-of-state savings institution, out-of-state savings and loan holding company or out-of-state bank holding company which acquires a Delaware savings bank or Delaware savings and loan holding company, and may accept reports of examination and other records from such authorities in lieu of conducting an examination. The Commissioner may enter into joint actions with other regulatory authorities having concurrent jurisdiction over any out-of-state savings institution, out-of-state savings and loan holding company or out-of-state bank holding company that acquires a Delaware savings bank or Delaware savings and loan holding company or may take such actions independently to carry out the responsibilities under this subchapter to assure the safety and soundness of any Delaware savings bank or Delaware savings and loan holding company and to assure compliance with this subchapter and applicable Delaware banking laws.

66 Del. Laws, c. 33, § 3; 70 Del. Laws, c. 186, § 1; 70 Del. Laws, c. 327, § 22; 71 Del. Laws, c. 25, §§ 28, 29.;

Upon the Commissioner's determination that an out-of-state savings institution, out-of-state savings and loan holding company or out-of-state bank holding company is in violation of the requirements of this subchapter, or any order, regulation, ruling, cooperative agreement or decree issued or entered into by the Commissioner, or any order of any court of competent jurisdiction, or otherwise operating a Delaware savings bank in an unsafe and unsound manner, then the Commissioner shall have the authority to order such out-of-state savings institution, out-of-state savings and loan holding company or out-of-state bank holding company, or any subsidiary of the foregoing, to remedy such violation by a date certain, or to cease and desist from operating in an unsafe and unsound manner, in default of which the Commissioner shall have the authority to order such out-of-state savings institution, out-of-state savings and loan holding company or out-of-state bank holding company, or any subsidiary of the foregoing, to divest itself of any shares or assets of any Delaware savings bank which it has acquired under this subchapter. The procedure governing such divestiture, and the authority of the Commissioner to enforce an order directing the same against an out-of-state savings institution, out-of-state savings and loan holding company or out-of-state bank holding company shall be the same as provided in relation to an out-of-state bank holding company in § 807(b) through (d) of this title.

66 Del. Laws, c. 33, § 3; 70 Del. Laws, c. 186, § 1; 70 Del. Laws, c. 327, § 23; 71 Del. Laws, c. 25, § 30.;

Nothing contained in this chapter shall be construed as abridging the rights, powers and authorities granted to any Delaware savings bank required under its charter, the provisions of this title, or any other current, former or future law of the State or the United States governing the formation, conversion, merger, corporate powers, branching, operation or dissolution of a Delaware savings bank.

66 Del. Laws, c. 33, § 3; 70 Del. Laws, c. 327, § 24; 71 Del. Laws, c. 25, § 31.;

This subchapter deals with the conditions under which out-of-state savings institutions, out-of-state savings and loan holding companies and out-of-state bank holding companies may acquire a Delaware savings bank or a Delaware savings and loan holding company; it shall not be construed to have any applicability to Part III of this title relating to building and loan associations nor to constitute any authority for the acquisition of Delaware building and loan associations.

66 Del. Laws, c. 33, § 3.;