(1)
(a) Except as otherwise provided in this code, only the banking board may take
possession of a state bank if, after a hearing before the banking board, the banking
board finds: The bank's capital is inadequate or it is otherwise in an unsound
condition; the bank's business is being conducted in an unlawful or unsound
manner; the bank is unable to continue normal operations; examination of the bank
has been obstructed or impeded; or control of the bank has been assumed by any
person or persons convicted of fraud or a felony in this state or any other
jurisdiction, or by any partnership, association, or corporation controlled, directly or
indirectly, by any person so convicted, unless the banking board determines that
such person has been duly rehabilitated or otherwise that the bank will be honestly
and efficiently managed.
(b) Notice of hearing shall be mailed by first-class mail to the bank and the
directors of the bank no less than ten days prior to the hearing. Any proceedings
conducted pursuant to this subsection (1) shall be exempt from any provision of law
requiring that proceedings of the banking board be conducted publicly.
(2) (a) The commissioner, upon order of the banking board, shall take
possession by posting upon the premises a notice reciting that the commissioner is
assuming possession pursuant to this code and the time, not earlier than the
posting of the notice, when possession is deemed to commence. A copy of the
notice shall be filed in the district court in and for the county in which the bank is
located. The commissioner shall notify the federal reserve bank of the district of
taking possession of any state bank that is a member of the federal reserve system
and shall notify the federal deposit insurance corporation of taking possession of
any state bank that is a member of the federal deposit insurance corporation.
(b) When the commissioner has taken possession of a state bank, the
commissioner shall be vested with the full and exclusive power of management and
control, including the power to continue or to discontinue the business; to stop or to
limit the payment of its obligations; to employ any necessary assistants, including
legal counsel; to execute any instrument in the name of the bank; to commence,
defend, and conduct in its name any action or proceeding to which it may be a party;
to terminate such possession by restoring the bank to its board of directors; and to
reorganize or liquidate the bank in accordance with this code. As soon as
practicable after taking possession, the commissioner shall make an inventory of
the assets and file a copy thereof with the court in which the notice of possession
was filed.
(c) When the commissioner is in possession and while the commissioner's
possession continues, there shall be a postponement, until six months after such
taking, of the date upon which any period of limitation fixed by statute or
agreement would otherwise expire on a claim or right of action of the bank, or upon
which a review must be taken, or a pleading, or other document must be filed, by
the bank in any pending action or proceeding.
(3) (a) If the banking board determines, after hearing before the banking
board, to liquidate the state bank, it shall give notice of its determination by posting
upon the premises a notice reciting that the determination has been made to
liquidate the bank. A copy of the notice shall be filed in the district court in and for
the county in which the bank is located. The commissioner, upon order of the
banking board, shall tender to the federal deposit insurance corporation or its
successor the appointment as liquidator under section 11-103-805.
(b) If, in the opinion of the banking board, an emergency exists that may
result in serious losses to the depositors, it may take possession of a state bank and
may immediately appoint the federal deposit insurance corporation or its successor
as liquidator in accordance with section 11-103-805 without notice of a hearing.
Notice of the banking board's emergency determination shall be posted and filed in
the same manner as prescribed in paragraph (a) of this subsection (3). Within ten
days after the banking board's emergency determination, the bank or the directors
of the bank may file an application with the banking board to rescind its
determination. The filing of an application shall not act as a stay of the banking
board's action pursuant to this subsection (3). The banking board shall grant the
application if it finds that its action was unauthorized and shall rescind its action
taking possession and restore the bank to its board of directors. If no application is
filed within ten days after the banking board's emergency determination, all action
taken by the banking board shall be final.
(c) Notice of hearing shall be mailed by first-class mail to the bank and the
directors of the bank no less than ten days prior to the hearing. Any proceeding
conducted pursuant to this subsection (3) shall be exempt from any provision of law
requiring that proceedings of the banking board be conducted publicly.
(d) If the federal deposit insurance corporation or its successor does not
accept the tender of appointment as liquidator, the banking board as liquidator
shall proceed to liquidate the institution, upon first providing a bond executed by
some surety company authorized to do business in this state, running to the people
of the state of Colorado, that meets with the approval of the banking board, for the
faithful discharge of its duties in connection with such liquidation and the
accounting for all moneys coming into its hands. The cost of such bond shall be
paid from the assets of the bank. Suit may be maintained on such bond by any
person injured by a breach of conditions thereof.
(e) If the commissioner determines to reorganize the state bank or if the
banking board, after staying its liquidation, orders such reorganization, the
commissioner, after according a hearing to all interested persons, shall enter an
order proposing a reorganization plan. A copy of the plan shall be sent to each
depositor and creditor who shall not receive payment of the depositor's or creditor's
claim in full under the plan, together with notice that, unless within fifteen days the
plan is disapproved in writing by persons holding one-third or more of the
aggregate amount of such claims, the commissioner will proceed to effect the
reorganization. A department, agency, or political subdivision of this state holding a
claim that will not be paid in full is authorized to participate as any other creditor.
(4) No judgment, lien, or attachment shall be executed upon any asset of the
state bank while it is in the possession of the banking board. Upon the election of
the banking board, in connection with a liquidation or reorganization:
(a) Any lien or attachment, other than an attorney's or mechanic's lien,
obtained upon any asset of the state bank during the banking board's possession,
or within four months prior to commencement thereof, shall be vacated and voided,
except liens created by the banking board while in possession and further
excepting liens or security interests obtained by the federal reserve bank;
(b) Any transfer of an asset of the state bank made after or in contemplation
of its insolvency, with intent to effect a preference, shall be voided.
(5) With the approval of the banking board, the commissioner may borrow
money in the name of the state bank and may pledge its assets as security for the
loan.
(6) All necessary and reasonable expenses of the commissioner's possession
of a state bank and of its reorganization or liquidation shall be defrayed from the
assets thereof.