§ 138 — Foreign branches; performance of contracts and repayment of deposits

New York § 138

• Jurisdiction: New York
• Law BNK: Banking
• Art. 3: Banks and Trust Companies

Text

§ 138. Foreign branches; performance of contracts and repayment of\ndeposits. 1. Notwithstanding section 1--301 of the uniform commercial\ncode, any bank or trust company or national bank located in this state\nwhich in accordance with the provisions of this chapter or otherwise\napplicable law shall have opened and occupied a branch office or branch\noffices in any foreign country shall be liable for contracts to be\nperformed at such branch office or offices and for deposits to be repaid\nat such branch office or offices to no greater extent than a bank,\nbanking corporation or other organization or association for banking\npurposes organized and existing under the laws of such foreign country\nwould be liable under its laws. The laws of such foreign country for the\npurpose of this section shall be deemed to include all acts, decrees,\nregulations and orders promulgated or enforced by a dominant authority\nasserting governmental, military or police power of any kind at the\nplace where any such branch office is located, whether or not such\ndominant authority be recognized as a de facto or de jure government.\n 2. Notwithstanding section 1--301 of the uniform commercial code, if\nby action of any such dominant authority which is not recognized by the\nUnited States as the de jure government of the foreign territory\nconcerned, any property situated in or any amount to be received in such\nforeign territory and carried as an asset of any branch office of such\nbank or trust company or national bank in such foreign territory is\nseized, destroyed or cancelled, then the liability of such bank or trust\ncompany or national bank for any deposit theretofore received and\nthereafter to be repaid by it, and for any contract theretofore made and\nthereafter to be performed by it, at any branch office in such foreign\nterritory shall be reduced pro tanto by the proportion that the value\n(as shown by the books or other records of such bank or trust company or\nnational bank at the time of such seizure, destruction or cancellation)\nof such assets bears to the aggregate of all the deposit and contract\nliabilities of the branch office or offices of such bank or trust\ncompany or national bank in such foreign territory, as shown at such\ntime by the books or other records of such bank or trust company or\nnational bank.\n 2-a. Notwithstanding the provisions of any law to the contrary, a bank\nor trust company or national bank located in this state shall not be\nrequired to repay any deposit made at a foreign branch of any such bank\nif the branch cannot repay the deposit due to (i) an act of war,\ninsurrection, or civil strife; or (ii) an action by a foreign government\nor instrumentality, whether de jure or de facto, in the country in which\nthe branch is located preventing such repayment, unless such bank has\nexpressly agreed in writing to repay the deposit under such\ncircumstances. The superintendent of financial services may promulgate\nregulations necessary to effectuate the provisions of this subdivision,\nincluding regulations providing for adequate disclosure to retail\ndepositors in the United States of the restrictions on repayment\ncontained in this subdivision. The provisions of this subdivision shall\nnot alter or diminish the liability of a custodian of assets of a fund\nunder section one hundred seventy-eight-a of the retirement and social\nsecurity law.\n 3. If any provision of this section, or the application of such\nprovision to any bank, trust company or national bank, shall be held\ninvalid, the remainder of this section, and the application of such\nsection to banks, trust companies and national banks other than those to\nwhich it is held invalid, shall not be affected thereby.\n