(1) Within sixty days
following the filing of the completed application for a de novo charter or conversion
of an established bank, the commissioner shall make or cause to be made a careful
investigation to determine that the following requirements have been met:
(a) That the applicant has proceeded in a lawful manner;
(b) That the name is not deceptively similar to that of another bank or
otherwise misleading;
(c) That the persons who will serve as directors or officers, insofar as such
persons are known, possess the qualifications and experience required under rules
promulgated by the banking board and that the qualifications and financial status
of the incorporators, directors, officers, and persons in control of the bank, as
defined in section 11-102-302 (2), are consistent with their responsibilities and
duties;
(d) That the proposed capital satisfies the standards and guidelines in the
rules promulgated by the banking board;
(e) That the proposed or amended articles of incorporation and bylaws are
appropriate or may be amended to be appropriate.
(2) If the commissioner determines that any of the requirements in
subsection (1) of this section have not been met in any respect, the commissioner
shall notify the applicant of such deficiencies and of corrective measures deemed
appropriate. Within six months after the filing of an application for charter, and
prior to the hearing prescribed in subsection (3) of this section, the commissioner
shall report to the banking board that the applicant has met all of the requirements
of subsection (1) of this section, if such be the case, or shall report which
requirements have been met and which have not been met, together with the
circumstances respecting such deficiencies. This report shall be introduced by the
banking board into the record of the hearing on such application.
(3) (a) The banking board, within six months after the filing of an application
for charter, and subject to subsection (7) of this section, shall hold a public hearing
to consider the application; except that the banking board, for valid reasons and
good cause, may postpone such hearing. At such hearing, the applicant for a de
novo bank charter has the burden of proving:
(I) That the proposed bank will serve a public need and advantage in the
community or area of the community that the bank will serve; and
(II) That the volume of business in the community or area of the community
that the proposed bank will serve is such that profitable operation of the bank may
be reasonably projected.
(b) Notwithstanding any other provision of this section, if the banking board
has given notice pursuant to subsection (5) of this section of a hearing on any
application for charter filed pursuant to this section and the banking board has
received no written protests against such charter application on or before the tenth
day preceding the date fixed for the hearing, the banking board may grant such
charter without a hearing as otherwise required in this section if the applicants for
such charter are known to the banking board.
(4) On hearing, the banking board may admit in evidence the application for
charter and any other relevant information in the files of the division. The applicant
and all others receiving notice by registered or certified mail under subsection (5)
of this section are also entitled to be heard and to introduce testimony at such
hearing, as well as such others as the banking board may determine to be
necessary.
(5) The banking board shall give notice of the hearing on application for a de
novo bank charter provided in subsection (3) of this section at least thirty days in
advance of the hearing date fixed by the banking board, by registered or certified
mail, to the applicant, to each bank within a three-mile radius of the location of the
proposed bank, and to such other persons or banks as the banking board may
designate. The notice must be in the form prescribed by the banking board and
must include the names of the incorporators, the name of each stockholder
subscribing to ten percent or more of the stock of the bank, the name and location
of the proposed bank, the date, time, and place of the hearing, and a statement
declaring that the application and proposed articles of incorporation or amended
articles of incorporation are available for inspection in the office of the banking
board. The banking board shall also cause such notice to be published at least one
time not less than twenty days prior to the date fixed for such hearing in a
newspaper of general circulation within the community in which the proposed bank
is to be located.
(6) Within one hundred twenty days following the date of conclusion of the
hearing, the banking board shall issue a written order requiring the commissioner to
grant a charter if a majority of the banking board finds that the requirements of
subsection (1) of this section have been met and that the applicant for a de novo
bank charter has met the burden of proof prescribed in subsection (3) of this
section. The banking board shall make execution of its order to grant a de novo
bank charter contingent upon the proposed bank making a bona fide application for
membership in the federal deposit insurance corporation or the federal reserve
system. In applications where the directors or management has not been fully
disclosed at the time of the hearing, the banking board may make execution of its
order to grant a charter contingent upon its subsequent approval of the directors
and management. If a majority of the banking board finds that the requirements of
subsection (1) of this section or the burden of proof of subsection (3) of this section
have not been met, the banking board shall deny the application for a de novo
charter. The banking board may revoke a charter in any case where the proposed
bank has not exercised its charter and opened for business within six months after
the date of the order to grant the charter.
(7) If, within a ninety-day period, there have been filed with the banking
board two or more applications for a de novo bank charter for state banks to serve
the same community, the banking board may hold a single hearing to consider the
applications. The banking board may grant or deny a de novo bank charter to one or
more of the applicants without regard to the priority in time of filing applications.
The determination of the banking board to deny a charter to an applicant who might
otherwise qualify for a charter under subsections (1) and (3) of this section must be
based upon a finding that the public need or advantage of the community or area of
the community in which the proposed bank will be located will best be served by
such denial and by the granting of a de novo bank charter on another application or
other applications heard at such single hearing.
(8) It is a criminal offense under this code for a proposed de novo state bank
to perform any act as a state bank other than to perfect its organization, obtain and
equip a place of business, or otherwise prepare to do business as a state bank prior
to receiving a charter.
(9) Unless otherwise provided by law to the contrary, the banking board must
first approve the articles of incorporation, amended articles of incorporation, or
amendments to articles of incorporation, which the applicant shall then deliver and
file as follows:
(a) Duplicate originals shall be delivered to the secretary of state for filing in
accordance with the general corporate laws of this state;
(b) A verified copy shall be filed in the office of the clerk and recorder for the
county in which the state bank is located;
(c) A copy to which the commissioner shall affix the charter, or certificate of
approval in the case of amendments, shall be delivered by the commissioner to the
applicant.