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Oklahoma Administrative Code (Last Updated: March 11, 2021) |
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TITLE 85. State Banking Department |
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Chapter 10. Supervision, Regulation and Administration of Banks, Trust Companies, and the Oklahoma Banking Code |
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Subchapter 9. New Banks, Branches, and Other Facilities |
SECTION 85:10-9-2. Application to establish or relocate a branch
Latest version.
- (1) A bank desiring to establish or relocate a branch pursuant to the Code, shall submit to the Commissioner the original and two copies of an application on a form prescribed by the Commissioner.(2) The application shall be executed by the applicant's president or vice-president.(3) An application fee as set forth in 85:10-3-21 shall accompany each application.(4) Applicants are urged to submit their applications to the Federal Deposit Insurance Corporation (nonmember banks) or the Federal Reserve Board (member banks) at the same time the application is submitted to the Commissioner.(b) Investigation. The Commissioner may request additional information from the applicant and conduct such investigation as he deems appropriate. No special emphasis will be placed on an appraisal of economic and competitive conditions.(c) Commissioner approval.(1) Unless the Applicant requests a hearing before the Board either by having so stated in the Application or by subsequent written request, the Commissioner may consider the Application, grant approval and issue the certificate of authority to establish and operate or to relocate a branch or detached facility without a hearing before the Board. The Commissioner's consideration of the Application for approval shall be conducted pursuant to the same standards and criteria as are applicable to applications before the Board.(2) Approval may be granted by the Commissioner only in the event applicant's latest completed examination reflects a Uniform Financial Institutions Composite "CAMEL" rating of 1 or 2, and the applicant is not subject to supervisory action by the Department such as a memorandum of understanding, cease and desist order, or similar action.(3) If the Commissioner determines that the application should not be approved, the application will proceed pursuant to subsection (d) of this section.(4) The Commissioner shall have the absolute discretion to defer ruling on any application thereby allowing such application to be heard before the Board for consideration and approval/disapproval.(d) Notice of intent to recommend denial. In the event the Commissioner, based on his investigation, determines not to approve the application, the Commissioner shall send to the applicant by overnight mail or electronic communication a written notice of intent to recommend denial, including the reasons for such negative recommendation and the date, time and place the application will be heard by the Board. Within ten (10) days after receipt of such notice, the applicant shall notify the Commissioner of its intent to withdraw its application or to proceed with a hearing on the application before the Board.(e) Hearing. In the event a hearing before the Board is set by the Commissioner, such hearing shall be conducted as follows:(1) Time limit. The applicant shall be limited to 30 minutes to present testimony and arguments at the hearing. Additional time may be granted by the Commissioner upon good cause shown.(2) Transcript. A transcript may be made of each hearing of an application. The Commissioner or the applicant may arrange for a court reporter to be present to record the proceedings. All expenses of the reporter, including the furnishing of the original and two(2) copies of the transcript to the Commissioner, shall be borne by the applicant.(3) Procedure. The order of presentation, appearance of witnesses, and presentation of evidence for hearings of applications shall be as directed by the chair of the Board present at the hearing. Ten (10) copies of all documentary evidence shall be furnished to the Commissioner prior to the hearing as directed by the Commissioner.(4) Decision of the Board. Within twenty (20) days after the conclusion of the hearing of an application, or such additional time as the Board may prescribe, the Board chair shall issue an order approving or disapproving the application, and shall promptly mail a copy of the order to the applicant.(5) Criteria. No special emphasis will be placed by the Board on an appraisal of economic and competitive conditions. The Board, at its discretion, may consider the following factors in arriving at its decision:(A) Financial condition and history of the applicant. The current asset and liability condition and history of the applicant, its compliance with applicable laws and regulations, and its investment in fixed assets are primary areas of consideration. The applicant's aggregate fixed asset investment, including lease obligations, must be reasonable in relation to its projected earnings capacity and capital, and must comply with Section 414 of the Code.(B) Adequacy of capital structure. Capital earnings and retention of earnings should be sufficient to support the applicant's current level of operations as well as the proposed expansion.(C) Future earnings prospect. The applicant's earnings potential will be evaluated in terms of the ability of overall bank earnings to absorb the anticipated expenses resulting from the establishment and operation of the proposed branch.(D) Quality of management. The applicant's management must have demonstrated ability to operate the bank in a sound manner, and must display the degree of depth necessary to permit the establishment of the proposed branch.(E) Legal limitations. Any statutory limitations and requirements regarding the establishment and location of branches.(F) Insiders. Any financial or other business arrangement, direct or indirect, involving the proposed branch and bank insiders which involve terms and conditions more favorable to insiders than would be available in a comparable transaction with unrelated parties.(G) Affiliates. The current asset and liability condition and history of any of applicant's affiliates, and other financial information on such affiliates which the Board deems relevant. As used in this paragraph, "affiliate" shall mean any company which the applicant controls, any company which controls the applicant, or any company under control of a company which also controls the applicant. For purposes of this paragraph, "control" shall be presumed to exist when one or more persons acting in concert directly or indirectly own, control, or have power to vote 25 percent or more of any class of voting securities of another person; or one or more persons acting in concert control, in any manner, the election of a majority of the directors, trustees, or other persons exercising similar functions of another person; or any other circumstances exist which indicate that one or more persons acting in concert directly or indirectly exercise a controlling influence over the management or policies of another person.(f) Conditions. The Board's or Commissioner's approval of an application shall be subject to any condition deemed by the Board or Commissioner to be relevant to the criteria set forth in (e)(5) of this Section.(g) Commencement of business. The applicant shall commence business at the branch within eighteen (18) months of Board or Commissioner approval. Extensions of time within which to commence business may be granted by the Commissioner only upon good cause shown.(h) Reapplication. In the event an application is disapproved by the Board, the applicant may submit a new application following a material change of the circumstances which were the basis for the initial disapproval.(i) Judicial review. The decision of the Board disapprovingan application may be appealed to the Oklahoma Supreme Court. An appeal shall be commenced and conducted in accordance with the provisions of Section 207 of the Code.(j) Military installation branch. An application to establish a military banking facility or a branch on a military installation pursuant to Section 421 of the Code shall be made in accordance with this Rule 85:10-9-2. Provided, the application shall be accompanied by a letter of approval from the military installation commander.