Text: SSB02168                          Text: SSB02170
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Bills and Amendments: General Index     Bill History: General Index

Senate Study Bill 2169

Bill Text

PAG LIN
  1  1    Section 1.  Section 527.2, subsections 2 and 9, Code 1997,
  1  2 are amended to read as follows:
  1  3    2.  "Administrator" means and includes the superintendent
  1  4 of banking, the superintendent of savings and loan
  1  5 associations, and the superintendent of credit unions within
  1  6 the department of commerce and the supervisor of industrial
  1  7 loan companies within the office of the superintendent of
  1  8 banking.  However, the powers of administration and
  1  9 enforcement of this chapter shall be exercised only as
  1 10 provided in sections 527.3, 527.5, subsection 7, 527.11,
  1 11 527.12, and any other pertinent provision of this chapter.
  1 12    9.  "Financial institution" means and includes any a bank
  1 13 incorporated under the provisions of any state or federal law,
  1 14 any a savings and loan association incorporated under the
  1 15 provisions of any state or federal law, any savings bank
  1 16 incorporated under state or federal law, a credit union
  1 17 organized under the provisions of any state or federal law,
  1 18 any a corporation licensed as an industrial loan company under
  1 19 chapter 536A, and any an affiliate of a bank, savings and loan
  1 20 association, savings bank, credit union, or industrial loan
  1 21 company.
  1 22    Sec. 2.  Section 527.3, subsection 1, Code 1997, is amended
  1 23 to read as follows:
  1 24    1.  For purposes of this chapter the superintendent of
  1 25 banking only has the power to issue rules applicable to, to
  1 26 accept and approve or disapprove applications or informational
  1 27 statements from, to conduct hearings and revoke any approvals
  1 28 relating to, and to exercise all other supervisory authority
  1 29 created by this chapter with respect to banks and savings
  1 30 banks; the superintendent of savings and loan associations
  1 31 only shall have and exercise such powers and authority with
  1 32 respect to savings and loan associations; the superintendent
  1 33 of credit unions only has such powers and authority with
  1 34 respect to credit unions; and the superintendent of banking or
  1 35 the superintendent's designee only has such powers and
  2  1 authority with respect to industrial loan companies.
  2  2    Sec. 3.  Section 534.101, Code 1997, is amended to read as
  2  3 follows:
  2  4    534.101  SHORT TITLE.
  2  5    This chapter may be cited as "Savings and Loan Association
  2  6 Bank chapter".
  2  7    Sec. 4.  Section 534.102, subsections 2, 14, and 28, Code
  2  8 1997, are amended to read as follows:
  2  9    2.  "Association", or "state association", or "savings
  2 10 bank" means a corporation holding a certificate of authority
  2 11 to operate under this chapter as either a mutual association
  2 12 savings bank or a stock association savings bank.
  2 13    14.  "Member" shall mean a person owning a share account of
  2 14 an association a mutual savings bank, and a person borrowing
  2 15 from or assuming or obligated upon a loan held by an
  2 16 association a mutual savings bank, or purchasing property
  2 17 securing a loan held by an association a mutual savings bank
  2 18 and any contract purchaser from the association mutual savings
  2 19 bank.  A joint and survivorship relationship, whether of
  2 20 investors or borrowers, constitutes a single membership.
  2 21    28.  "Superintendent" means the superintendent of savings
  2 22 and loan associations appointed pursuant to section 534.401
  2 23 banking.
  2 24    Sec. 5.  Section 534.103, Code 1997, is amended to read as
  2 25 follows:
  2 26    534.103  GENERAL POWERS.
  2 27    Every such association savings bank shall have the
  2 28 following general powers:
  2 29    1.  GENERAL CORPORATE POWER.  To sue and be sued, complain
  2 30 and defend in any court of law or equity; to purchase,
  2 31 acquire, hold, and convey real and personal estate consistent
  2 32 with its objects and powers; to mortgage, pledge, or lease any
  2 33 real or personal estate owned by the association savings bank
  2 34 and to authorize a pledgee to repledge the property; to take
  2 35 property by gift, devise, or bequest; to have a corporate
  3  1 seal, which may be affixed by imprint, facsimile, or
  3  2 otherwise; to appoint officers, agents, and employees as its
  3  3 business requires and allow them suitable compensation; to
  3  4 provide for life, health, and casualty insurance for its
  3  5 officers and employees and to adopt and operate reasonable
  3  6 bonus plans and retirement benefits for the officers and
  3  7 employees to enter into payroll savings plans; to adopt and
  3  8 amend bylaws; to insure its accounts with the savings
  3  9 association insurance fund of the federal deposit insurance
  3 10 corporation and qualify as a member of a federal home loan
  3 11 bank; to become a member of, deal with, or make contributions
  3 12 to any organization to the extent that the organization
  3 13 assists in furthering or facilitating the association's
  3 14 savings bank's purposes or powers and to comply with
  3 15 conditions of membership; to accept savings as provided in
  3 16 this chapter together with other powers otherwise expressly
  3 17 provided for in this chapter, together with implied powers as
  3 18 reasonably necessary for the purpose of carrying out the
  3 19 express powers granted in this chapter.
  3 20    2.  FISCAL AGENT.  Any such association A savings bank
  3 21 which is a member of a federal home loan bank shall have power
  3 22 to act as fiscal agent of the United States and, when
  3 23 designated for the purpose by the secretary of the treasury,
  3 24 it shall perform under such regulations as the secretary may
  3 25 prescribe all such reasonable duties as fiscal agent of the
  3 26 United States as the secretary may require, and shall have
  3 27 power to act as agent for any United States government
  3 28 instrumentality.  An association A savings bank may also
  3 29 handle travelers checks and money orders.
  3 30    3.  LOCK BOXES.  Any association A savings bank may own and
  3 31 rent to its members lock boxes for storage or safekeeping of
  3 32 securities and valuables.
  3 33    4.  POWER TO BORROW.  Except as provided by its articles of
  3 34 incorporation, an association a savings bank may borrow not
  3 35 more than an aggregate amount equal to its savings liability
  4  1 on the date of borrowing.  A subsequent reduction of savings
  4  2 liability shall not affect in any way outstanding obligations
  4  3 for borrowed money.  All loans and advances may be secured by
  4  4 property of the association savings bank.  In addition to the
  4  5 above unsecured or secured borrowing, an association a savings
  4  6 bank may issue notes, bonds, debentures and other obligations
  4  7 or securities approved by the superintendent, and if
  4  8 authorized by the regulations of the federal home loan bank.
  4  9 However, the obligations and securities are subject to the
  4 10 priority of the rights of the owners of the savings and
  4 11 deposits of the association savings bank.
  4 12    5.  SERVICE CORPORATIONS.  Any association A savings bank
  4 13 may organize and own, alone or with any other similar
  4 14 corporation, a service corporation for the mutual good of the
  4 15 associations savings banks.  The superintendent shall have the
  4 16 right to examine service corporations.
  4 17    6.  LIMITED TRUST POWERS.  An association A savings bank
  4 18 incorporated under this chapter may act as trustee for trusts
  4 19 which are created or organized in the United States, and which
  4 20 form part of a stock bonus, pension, or profit sharing plan
  4 21 which qualifies for special tax treatment under section 401(d)
  4 22 or subsection (a) of section 408 of the Internal Revenue Code,
  4 23 as amended, or as trustee with no active fiduciary duties, if
  4 24 the funds of the trust are invested only in savings accounts
  4 25 or deposits in the association savings bank or in obligations
  4 26 or securities issued by the association savings bank.  All
  4 27 funds held in such a fiduciary capacity by an association a
  4 28 savings bank may be commingled for appropriate purposes of
  4 29 investment, but individual records shall be kept by the
  4 30 fiduciary for each participant and shall show in proper detail
  4 31 all transactions engaged in under the authority of this
  4 32 subsection.
  4 33    The superintendent is authorized to grant by special permit
  4 34 to an association the right to act as trustee, executor,
  4 35 administrator, guardian, or in any other fiduciary capacity.
  5  1 However, this authority is available only for periods of time
  5  2 when federally chartered savings and loan associations
  5  3 operating in this state are granted similar authority, and the
  5  4 state authorization is subject to the rights and limitations
  5  5 established in rules adopted by the superintendent, which
  5  6 shall be consistent with the rights and limitations for
  5  7 federally chartered associations engaged in this type of
  5  8 activity.
  5  9    7.  TAX AND LOAN ACCOUNTS.  To act as depository for
  5 10 receipt of payments of federal or state taxes and loan funds
  5 11 from persons other than the state or subdivisions, agencies or
  5 12 instrumentalities of the state, and satisfy any federal or
  5 13 state statutory or regulatory requirements in connection
  5 14 therewith with acting as such depository, including pledging
  5 15 of assets as collateral, payment of earnings at prescribed
  5 16 rates and, notwithstanding any other provision of this
  5 17 chapter, issuing such accounts subject to the right of
  5 18 immediate withdrawal.
  5 19    8.  LEASING OF PERSONAL PROPERTY.  To acquire, upon the
  5 20 specific request of and for the use of a customer, and lease,
  5 21 personal property pursuant to a binding arrangement for the
  5 22 leasing of the property to the customer upon terms requiring
  5 23 payment to the association savings banks, during the minimum
  5 24 period of the lease, of rentals which in the aggregate, when
  5 25 added to the estimated tax benefits to the association savings
  5 26 bank resulting from the ownership of the leased property plus
  5 27 the estimated residual market value of the leased property at
  5 28 the expiration of the initial term of the lease, will be at
  5 29 least equal to the total expenditures by the association
  5 30 savings bank for, and in connection with, the acquisition,
  5 31 ownership, maintenance, and protection of the property.  A
  5 32 lease made under authority of this section shall have the
  5 33 prior approval of the superintendent or be made pursuant to
  5 34 personal property lease guidelines approved by the
  5 35 superintendent for use by the lessor association savings bank
  6  1 or pursuant to a personal property lease guideline rule of
  6  2 general applicability for use by all associations savings
  6  3 banks.
  6  4    9.  ELECTRONIC TRANSACTIONS.  Engage in any transaction
  6  5 otherwise permitted by this chapter and applicable law, by
  6  6 means of either the direct transmission of electronic impulses
  6  7 to or from the association savings bank or the recording of
  6  8 electronic impulses or other indicia of a transaction for
  6  9 delayed transmission to the association savings bank.  Subject
  6 10 to the provisions of chapter 527, an association a savings
  6 11 bank may utilize, establish, or operate, alone or with one or
  6 12 more other associations savings banks, banks incorporated
  6 13 under the provisions of chapter 524 or federal law, credit
  6 14 unions incorporated under the provisions of chapter 533 or
  6 15 federal law, corporations licensed under chapter 536A, or
  6 16 third parties, the satellite terminals permitted under chapter
  6 17 527, by means of which the association savings bank may
  6 18 transmit to or receive from any member electronic impulses
  6 19 constituting transactions pursuant to this subsection.
  6 20 However, such utilization, establishment, or operation shall
  6 21 be lawful only when in compliance with chapter 527.  Nothing
  6 22 in this subsection shall be construed as authority for any
  6 23 association a savings bank or other person to engage in
  6 24 transactions not otherwise permitted by applicable law, nor
  6 25 shall anything in this subsection be deemed to repeal,
  6 26 replace, or in any other way affect any applicable law or rule
  6 27 regarding the maintenance of or access to financial
  6 28 information maintained by any association a savings bank.
  6 29    10.  AUTOMATIC AUTHORIZATION.  Any association A savings
  6 30 bank may have the right to participate in any new or
  6 31 additional powers or activities hereafter granted to such
  6 32 association savings bank under this chapter immediately upon
  6 33 the effective date of such additional authority, if authorized
  6 34 by the articles of incorporation of such association the
  6 35 savings bank.
  7  1    Sec. 6.  Section 534.103, Code 1997, is amended by adding
  7  2 the following new subsections:
  7  3    NEW SUBSECTION.  11.  POWER TO ACT AS FIDUCIARY.  When
  7  4 approving a proposed savings bank, or at any time subsequent
  7  5 to such approval upon amendment of its articles of
  7  6 incorporation, the superintendent may authorize a savings bank
  7  7 to act in a fiduciary capacity.  In determining whether to
  7  8 authorize a savings bank to act in a fiduciary capacity, the
  7  9 superintendent may consider any of the relevant criteria
  7 10 referred to in section 524.305, and other appropriate facts
  7 11 and circumstances.  In any fiduciary capacity in which a
  7 12 savings bank may act pursuant to this section, the savings
  7 13 bank shall have all the rights and duties which an individual
  7 14 has in such capacity under applicable law and under the terms
  7 15 upon which the savings bank is designated to act in such
  7 16 capacity.  In authorizing a savings bank to act in a fiduciary
  7 17 capacity, the superintendent may limit such authorization to
  7 18 such capacities as the superintendent deems appropriate.
  7 19    NEW SUBSECTION.  12.  ACTIONS REQUIRED, PERMITTED, OR
  7 20 PROHIBITED IN A FIDUCIARY CAPACITY.  The following rules shall
  7 21 be applicable to a savings bank acting in the capacity of
  7 22 fiduciary:
  7 23    a.  A savings bank shall segregate from its assets all
  7 24 property held as fiduciary, other than items in the course of
  7 25 collection, and shall keep separate records of all such
  7 26 property for each account for which such property is held.
  7 27    b.  Funds of a fiduciary account may be deposited in the
  7 28 savings bank which is acting as fiduciary, either as demand
  7 29 deposits, savings deposits, or time deposits having a single
  7 30 or multiple maturity.
  7 31    c.  A savings bank may provide any oath or affidavit
  7 32 required of the savings bank as fiduciary through an officer
  7 33 acting on behalf of the savings bank.
  7 34    d.  A savings bank shall not make a loan or extension of
  7 35 credit of any funds held as fiduciary, directly or indirectly,
  8  1 to or for the benefit of a director, officer, or employee of
  8  2 the savings bank or of an affiliate, a partnership, or other
  8  3 unincorporated association of which such director, officer, or
  8  4 employee is a partner or member, or a corporation in which
  8  5 such officer, director, or employee has a controlling
  8  6 interest, except a loan specifically authorized by the terms
  8  7 upon which the savings bank was designated as fiduciary.
  8  8    e.  Unless otherwise authorized by the instrument creating
  8  9 the relationship, court order, or the laws of this state, a
  8 10 savings bank, as fiduciary, shall not, directly or indirectly,
  8 11 sell any asset to the savings bank for its own account, or to
  8 12 an officer, director, or employee of such savings bank, or
  8 13 purchase from the savings bank, or an officer, director, or
  8 14 employee, any asset or any security issued by the savings bank
  8 15 except, in the case of a savings bank, any of the following:
  8 16    (1)  Investments in which a savings bank may invest without
  8 17 limitation pursuant to section 534.213.
  8 18    (2)  Assets purchased by the savings bank pursuant to an
  8 19 agreement whereby the savings bank is bound to sell, and the
  8 20 savings bank as fiduciary is bound to buy, at a date not more
  8 21 than one year from the date of acquisition by the savings
  8 22 bank, such assets at a price agreed upon at the time of
  8 23 acquisition by the savings bank.
  8 24    (3)  Any asset sold to the savings bank for its own account
  8 25 or purchased in a fiduciary capacity from the savings bank
  8 26 with the prior approval of the superintendent.
  8 27    NEW SUBSECTION.  13.  REMOVAL OF FIDUCIARY POWERS.  If the
  8 28 superintendent at any time concludes that a savings bank
  8 29 authorized to act in a fiduciary capacity is managing its
  8 30 accounts in an unsafe or unsound manner, or in a manner in
  8 31 conflict with the provisions of this chapter, and such savings
  8 32 bank refuses to correct such practices upon notice to do so,
  8 33 the superintendent may forthwith direct that the savings bank
  8 34 cease to act as a fiduciary and proceed to resign its
  8 35 fiduciary positions.
  9  1    In such event the superintendent shall cause to be filed a
  9  2 petition in the district court of the county in which the
  9  3 savings bank has its principal place of business setting forth
  9  4 in general terms that the savings bank is acting as fiduciary
  9  5 with respect to certain property and that it is necessary and
  9  6 desirable that successor fiduciaries be appointed.  Upon the
  9  7 filing of the petition the court shall enter an order
  9  8 requiring all persons interested in all such fiduciary
  9  9 accounts to designate and take all necessary measures to
  9 10 appoint a successor fiduciary within a time to be fixed by the
  9 11 order, or to show cause why a successor fiduciary should not
  9 12 be appointed by the court.  The court shall also direct the
  9 13 savings bank to mail a copy of the order to each living
  9 14 settlor and each person known by the savings bank to have a
  9 15 beneficial interest in the fiduciary accounts with respect to
  9 16 which the savings bank is fiduciary and with respect to which
  9 17 it is being asked to resign its position.  Such notice shall
  9 18 be mailed to the last known address of each such settlor and
  9 19 person having a beneficial interest as shown by the records of
  9 20 the savings bank.  The court may also order publication of
  9 21 such order to the extent that it deems necessary to protect
  9 22 the interests of absent or remote beneficiaries.
  9 23    In any fiduciary account where those interested therein
  9 24 fail to cause a successor fiduciary to be appointed prior to
  9 25 the time fixed in such order, the court shall appoint a
  9 26 successor fiduciary.  A successor fiduciary appointed pursuant
  9 27 to this section shall succeed to all the rights, powers,
  9 28 titles, duties, and responsibilities of the savings bank,
  9 29 except that the successor fiduciary shall not exercise powers
  9 30 given in the instrument creating the powers that by its
  9 31 express terms are personal to the fiduciary designated in the
  9 32 instrument and except for claims or liabilities arising out of
  9 33 the management of the fiduciary account prior to the date of
  9 34 the transfer.
  9 35    NEW SUBSECTION.  14.  VOLUNTARY RELINQUISHMENT OF FIDUCIARY
 10  1 CAPACITY.  A savings bank desiring to surrender its
 10  2 authorization to act in a fiduciary capacity, in order to
 10  3 relieve itself of the necessity of complying with the
 10  4 requirements attendant to such capacity, shall file with the
 10  5 superintendent a certified copy of a resolution signifying
 10  6 such intent.  In such event the savings bank shall cause to be
 10  7 filed a petition in the district court in the county in which
 10  8 the savings bank has its principal place of business setting
 10  9 forth in general terms that the savings bank is acting as
 10 10 fiduciary with respect to certain property and that it desires
 10 11 to cease its fiduciary function and resign its fiduciary
 10 12 positions.  Upon the filing of the petition, the
 10 13 relinquishment of fiduciary capacity and the appointment of a
 10 14 successor fiduciary or fiduciaries shall be handled in the
 10 15 same manner and with the same effect as provided for in
 10 16 subsection 13, dealing with the removal of fiduciary powers.
 10 17    After compliance with this section, the savings bank shall
 10 18 proceed to amend its articles of incorporation, pursuant to
 10 19 this chapter, in a manner to indicate that it is no longer
 10 20 authorized to act in a fiduciary capacity.  The superintendent
 10 21 shall approve the proposed amendment, in the manner provided
 10 22 for in this chapter, if the superintendent is satisfied that
 10 23 the savings bank has properly relieved itself of its fiduciary
 10 24 responsibilities.
 10 25    NEW SUBSECTION.  15.  SAVINGS BANKS DEPOSITING SECURITIES
 10 26 IN FEDERALLY REGULATED CORPORATION.  A savings bank, either
 10 27 acting as a fiduciary or holding securities as a managing
 10 28 agent or custodian, including a custodian for a fiduciary, may
 10 29 deposit securities in a federally regulated clearing
 10 30 corporation as provided in section 633.89, and in addition may
 10 31 deposit securities, the principal and interest of which the
 10 32 United States or any United States department, agency, or
 10 33 instrumentality either has agreed to pay or has guaranteed, in
 10 34 a federal reserve bank.
 10 35    The records of a depositing savings bank at all times must
 11  1 identify the persons on whose behalf securities have been
 11  2 deposited in a federal reserve bank.  An interest in deposited
 11  3 securities may be transferred by entry on the books of the
 11  4 federal reserve bank without physical delivery of the
 11  5 securities.  A depositing savings bank is subject to rules
 11  6 adopted by the superintendent, with respect to savings banks,
 11  7 and by the comptroller of the currency, with respect to
 11  8 national banking associations.  On demand by the owner, a bank
 11  9 acting as a managing agent or as a custodian shall identify in
 11 10 writing the securities deposited in a federal reserve bank for
 11 11 the account of the owner.  On demand by any party to the
 11 12 accounting of a savings bank acting as a fiduciary, the
 11 13 savings bank shall identify in writing the securities
 11 14 deposited in a federal reserve bank for its account as
 11 15 fiduciary.
 11 16    This subsection applies regardless of the date of the
 11 17 agreement, instrument, or court order under which the savings
 11 18 bank was appointed.
 11 19    NEW SUBSECTION.  16.  BRANCHING.  A savings bank may
 11 20 establish or relocate a branch office as permitted for a
 11 21 federal association under the federal Home Loan Bank Act, 12
 11 22 U.S.C. } 1464, and regulations of the office of thrift
 11 23 supervision, including but not limited to C.F.R. pts. 545.92
 11 24 and 545.95.  For purposes of this subsection, an Iowa savings
 11 25 bank which has a camel 1 or camel 2 rating shall be treated as
 11 26 if it were a federal savings bank eligible for expedited
 11 27 treatment, as defined in regulations of the office of thrift
 11 28 supervision, and each reference to the office of thrift
 11 29 supervision is deemed to reference the superintendent.
 11 30    Sec. 7.  Section 534.111, Code 1997, is amended to read as
 11 31 follows:
 11 32    534.111  RIGHTS OF FEDERAL ASSOCIATIONS – RECIPROCITY.
 11 33    Every federal savings and loan association incorporated
 11 34 under the Home Owners' Loan Act of 1933, 12 U.S.C. }
 11 35 1461–1468, as amended, and the holders of share accounts
 12  1 issued by any such association have all the rights, powers,
 12  2 and privileges and are entitled to the same exemptions and
 12  3 immunities, as savings and loan associations banks organized
 12  4 under the laws of this state and members thereof deposit
 12  5 holders of such banks are entitled.
 12  6    Every association  A savings bank organized under this
 12  7 chapter has all the rights, powers, and privileges not in
 12  8 conflict with the laws of this state, which are conferred upon
 12  9 federal savings and loan associations and its service
 12 10 corporations by the Home Owners' Loan Act of 1933, 12 U.S.C. }
 12 11 1464, and conferred by regulations adopted by the federal home
 12 12 loan bank board and the federal office of thrift supervision.
 12 13    Sec. 8.  Section 534.113, Code 1997, is amended to read as
 12 14 follows:
 12 15    534.113  REFERENCES TO UNITED STATES CODE AND REGULATIONS.
 12 16    All references in this chapter to the United States Code
 12 17 and regulations adopted pursuant to the United States Code
 12 18 refer to the United States Code and regulations as amended to
 12 19 and including in effect on January 1, 1990 1998.
 12 20    Sec. 9.  Section 534.207, subsection 1, unnumbered
 12 21 paragraph 1, Code 1997, is amended to read as follows:
 12 22    As A savings bank must be a qualified thrift lender as
 12 23 defined in 12 U.S.C. } 1467a(m), or as an annual average,
 12 24 based on monthly computations, an association shall hold at
 12 25 least sixty percent of its assets in the following types of
 12 26 assets:
 12 27    Sec. 10.  Section 534.207, subsections 2 and 3, Code 1997,
 12 28 are amended to read as follows:
 12 29    2.  FAILURE TO MEET COMMITMENT.  If, upon examination, the
 12 30 superintendent of savings and loan associations determines
 12 31 that an association a savings bank has failed to meet the
 12 32 requirements of subsection 1 for any two of its preceding five
 12 33 fiscal years, the association savings bank shall be so
 12 34 notified in writing, with a copy of the notice to the
 12 35 superintendent of banking, and the association savings bank
 13  1 shall within ninety days following receipt of the notice do
 13  2 one of the following:
 13  3    a.  Establish to the satisfaction of the superintendent
 13  4 that at least sixty percent of the current amount of its
 13  5 assets are held in the types of assets referred to in the
 13  6 savings bank satisfies the requirements of subsection 1.  If
 13  7 the association savings bank subsequently fails to meet the
 13  8 requirements of subsection 1 during any one of the three
 13  9 fiscal years following the fiscal year in which the second
 13 10 violation in five years occurred, then the association savings
 13 11 bank shall within ninety days following receipt of a notice of
 13 12 this violation take one of the actions specified in paragraph
 13 13 "b", "c", "d", or "e".
 13 14    b.  File a plan of merger to merge with another state
 13 15 association savings bank whose assets are such that the two
 13 16 associations savings banks would have met the requirements of
 13 17 subsection 1 on a consolidated basis during at least four of
 13 18 the five preceding years.
 13 19    c.  File a plan of merger with a federal association or a
 13 20 bank or national bank under which the resulting organization
 13 21 is not a state association savings bank.
 13 22    d.  File a plan of conversion to become a federal
 13 23 association savings bank or a bank or national bank.
 13 24    e.  File a plan of conversion that provides both for
 13 25 conversion to a stock association savings bank and for the
 13 26 immediate conversion of the resulting stock association
 13 27 savings bank to a bank or national bank.
 13 28    3.  FAILURE TO RESOLVE PROBLEM.  If an association a
 13 29 savings bank fails to take one of the actions required by
 13 30 subsection 2, or fails to complete the plan of merger or
 13 31 conversion within nine months after receiving the notice
 13 32 specified in subsection 2, the superintendent shall appoint a
 13 33 conservator to operate the association savings bank in
 13 34 conformance with subsection 1 or a receiver to liquidate the
 13 35 association savings bank.
 14  1    Sec. 11.  Section 534.214, subsections 1, 2, 5, 6, and 7,
 14  2 Code 1997, is amended to read as follows:
 14  3    1.  INVESTMENT IN BANKS.  A holding company, association
 14  4 savings bank, or service corporation may invest in the capital
 14  5 stock, obligations, or other securities of a bank with the
 14  6 prior approval of the superintendent of savings and loan
 14  7 associations.
 14  8    2.  INVESTMENT BY BANKS.  Notwithstanding sections 524.802
 14  9 and 524.901, subsection 3, a bank holding company, bank, or
 14 10 bank service corporation may, with the prior approval of the
 14 11 superintendent of banking, may invest in the capital stock,
 14 12 obligations or other securities of a state association savings
 14 13 bank.
 14 14    The superintendent of banking shall not approve an
 14 15 investment under this subsection if upon making the investment
 14 16 the entity making the investment directly or indirectly would
 14 17 own or control more than twenty-five percent of the voting
 14 18 shares of a savings and loan association bank or would have
 14 19 the power to control in any manner the election of a majority
 14 20 of the directors of a savings and loan association bank,
 14 21 unless the superintendent of banking first determines either
 14 22 that the association savings bank in which the investment is
 14 23 to be made has only those office locations which a bank would
 14 24 be authorized under section 524.1202 to apply for and have
 14 25 approved on the effective date of the proposed investment, or
 14 26 that all nonconforming office locations were in existence and
 14 27 operating on July 1, 1982 1998.  If such an investment is
 14 28 approved by the superintendent of banking, the association
 14 29 savings bank so owned or controlled shall not subsequently
 14 30 establish any additional office locations except one which a
 14 31 bank would be authorized under section 524.1202 to apply for
 14 32 and have approved on the date which the proposed office
 14 33 location would commence operations.
 14 34    5.  DEFINITIONS.  For purposes of this section an "insured
 14 35 bank" is a bank whose deposits are insured in part by the bank
 15  1 insurance fund of the federal deposit insurance corporation; a
 15  2 "bank service corporation" is as defined by, and in accordance
 15  3 with, the laws of the United States, and the "superintendent
 15  4 of banking" is the person appointed pursuant to section
 15  5 524.201.
 15  6    6.  FINDINGS REQUIRED.  The superintendent of savings and
 15  7 loan associations shall not grant an approval under subsection
 15  8 1, and the superintendent of banking shall not grant an
 15  9 approval under subsection or 2 except after making one of the
 15 10 two following findings:
 15 11    a.  Based upon a preponderance of the evidence presented,
 15 12 the proposed investment will not have the immediate effect of
 15 13 significantly reducing competition between depository
 15 14 financial institutions located in the same community as the
 15 15 institution whose shares would be acquired.
 15 16    b.  Based upon a preponderance of the evidence presented,
 15 17 the proposed investment would have the anticompetitive effect
 15 18 specified in paragraph "a" of this subsection, but that other
 15 19 factors, to be specifically cited, outweigh the
 15 20 anticompetitive effect so that there would be a net public
 15 21 benefit as a result of the investment.
 15 22    7.  COMPETITION PRESERVED.  The subsequent liquidation of a
 15 23 bank or state association savings bank whose shares are
 15 24 acquired under this section shall not prevent the subsequent
 15 25 incorporation of another bank in the same community, and the
 15 26 superintendent of banking shall not find the liquidation to be
 15 27 grounds for disapproving the incorporation of another bank in
 15 28 the same community under section 524.305, and shall not
 15 29 prevent the subsequent incorporation of another association
 15 30 savings bank in the same community, and the superintendent of
 15 31 savings and loan associations shall not find the liquidation
 15 32 to be grounds for disapproving the incorporation of another
 15 33 association savings bank in the same community under this
 15 34 chapter.
 15 35    Sec. 12.  Section 534.214, subsection 4, Code 1997, is
 16  1 amended by striking the subsection.
 16  2    Sec. 13.  Section 534.214, Code 1997, is amended by adding
 16  3 the following new subsection:
 16  4    NEW SUBSECTION.  8.  INVESTMENT BY BANK HOLDING COMPANY –
 16  5 NOTICE OF ACQUISITION.  A bank holding company which proposes
 16  6 to directly or indirectly acquire control of, or directly or
 16  7 indirectly acquire all or substantially all of the assets of,
 16  8 a savings bank shall provide to the superintendent a copy of
 16  9 the application and any modifications or amendments to the
 16 10 application submitted to the federal reserve board for
 16 11 permission to take such action at the same time the
 16 12 application is transmitted to the federal reserve board.  The
 16 13 superintendent may conduct such investigation into and
 16 14 evaluation of the proposed action as the superintendent deems
 16 15 necessary and appropriate, and may submit to the federal
 16 16 reserve board any information so obtained together with the
 16 17 superintendent's own comments or recommendations regarding the
 16 18 proposed acquisition.
 16 19    Sec. 14.  NEW SECTION.  534.410  DUTIES AND POWERS OF
 16 20 SUPERINTENDENT.
 16 21    The superintendent shall have general control, supervision,
 16 22 and regulation of all savings banks and shall be charged with
 16 23 the administration and execution of the laws of this state
 16 24 relating to savings banks and with such other duties and
 16 25 responsibilities as are imposed upon the superintendent by the
 16 26 laws of this state.  The superintendent shall have power to
 16 27 adopt such rules as in the superintendent's opinion will be
 16 28 necessary to properly and effectively carry out and enforce
 16 29 this chapter.
 16 30    Sec. 15.  NEW SECTION.  534.411  SUBPOENA – CONTEMPT.
 16 31    1.  The superintendent, the deputy superintendent, and,
 16 32 upon the approval of the superintendent, any assistant or
 16 33 examiner shall have the power to subpoena witnesses, to compel
 16 34 their attendance, to administer an oath, to examine any person
 16 35 under oath, and to require the production of any relevant
 17  1 books or papers.  Such examination may be conducted on any
 17  2 subject relating to the duties imposed upon, or powers vested
 17  3 in, the superintendent under this chapter.
 17  4    2.  Whenever a person subpoenaed pursuant to subsection 1
 17  5 neglects or refuses to obey the terms of such subpoena, to
 17  6 produce books or papers, or to give testimony, as required,
 17  7 the superintendent may apply to the district court of Polk
 17  8 county for the enforcement of such subpoena or the issuance of
 17  9 an order compelling such compliance as the court may direct.
 17 10    3.  The refusal of any person to obey an order of the
 17 11 district court, issued pursuant to subsection 2, without
 17 12 reasonable cause, is considered a contempt of that court.
 17 13    Sec. 16.  NEW SECTION.  534.412  RECORDS OF DIVISION OF
 17 14 BANKING.
 17 15    All records of the division of banking shall be public
 17 16 records subject to the provisions of chapter 22, except that
 17 17 all papers, documents, reports, reports of examinations, and
 17 18 other writings relating specifically to the supervision and
 17 19 regulation of a savings bank or other person by the
 17 20 superintendent pursuant to the laws of this state shall not be
 17 21 public records and shall not be open for examination or
 17 22 copying by the public or for examination or publication by the
 17 23 news media.
 17 24    The superintendent, deputy superintendent, assistants, or
 17 25 examiners shall not be subpoenaed in any cause or proceeding
 17 26 to give testimony concerning information relating specifically
 17 27 to the supervision and regulation of any savings bank or other
 17 28 person by the superintendent pursuant to the laws of this
 17 29 state, and the records of the banking division which relate
 17 30 specifically to the supervision and regulation of any such
 17 31 savings bank or other such person shall not be offered in
 17 32 evidence in any court or subject to subpoena by any party
 17 33 except, where relevant, as follows:
 17 34    1.  In such actions or proceedings as are brought by the
 17 35 superintendent.
 18  1    2.  In any matter in which an interested and proper party
 18  2 seeks review of a decision of the superintendent.
 18  3    3.  In any action or proceeding which arises out of the
 18  4 criminal laws of this state or the United States.
 18  5    4.  In any action brought as a shareholders derivative suit
 18  6 against a savings bank.
 18  7    5.  In an action brought to recover moneys for a loss in
 18  8 connection with an indemnity bond which was a result of
 18  9 embezzlement, misappropriation, or misuse of savings bank
 18 10 funds by a director, officer, or employee of the savings bank.
 18 11    Sec. 17.  NEW SECTION.  534.413  ANNUAL REPORT OF
 18 12 SUPERINTENDENT.
 18 13    The superintendent shall make a report in writing annually
 18 14 to the governor in the manner and within the time required by
 18 15 chapter 7A.  A copy of the report shall be furnished by the
 18 16 superintendent to each savings bank.
 18 17    In addition to the matters required by chapter 7A, the
 18 18 annual report of the superintendent shall contain all of the
 18 19 following:
 18 20    1.  A summary of applications approved or denied by the
 18 21 superintendent pursuant to this chapter since the
 18 22 superintendent's last previous report.
 18 23    2.  A summary of the assets, liabilities, and capital
 18 24 structure of all savings banks as of June 30 of the year for
 18 25 which the report is made.
 18 26    3.  A statement of the receipts and disbursements of funds
 18 27 of the superintendent during the calendar year ending on the
 18 28 preceding December 31 and of the funds on hand on such
 18 29 December 31.
 18 30    4.  Such other information as the superintendent may deem
 18 31 appropriate and advisable to fairly disclose the discharge of
 18 32 the duties imposed upon the superintendent by this chapter.
 18 33    Sec. 18.  NEW SECTION.  534.414  EXAMINATIONS.
 18 34    1.  The superintendent may do all of the following:
 18 35    a.  Make or cause to be made an examination of every
 19  1 savings bank whenever in the superintendent's judgment such
 19  2 examination is necessary or advisable, but in no event less
 19  3 frequently than once during each two-year period.  During the
 19  4 course of each examination of a savings bank, inquiry shall be
 19  5 made as to its financial condition, the security afforded to
 19  6 those to whom it is obligated, the policies of its management,
 19  7 whether the requirements of law have been complied with in the
 19  8 administration of its affairs, and such other matters as the
 19  9 superintendent may prescribe.
 19 10    b.  Make or cause to be made such limited examinations at
 19 11 such times and with such frequency as the superintendent deems
 19 12 necessary and advisable to determine the condition of any
 19 13 savings bank and whether any person has violated a provision
 19 14 of this chapter.
 19 15    c.  Make or cause to be made an examination of any
 19 16 corporation in which the savings bank owns shares.
 19 17    d.  Upon application to and order of the district court of
 19 18 Polk county, make or cause to be made an examination of any
 19 19 person having business transactions or a relationship with any
 19 20 savings bank when such examination is deemed necessary and
 19 21 advisable in order to determine whether the capital of the
 19 22 savings bank is impaired or whether the safety of its deposits
 19 23 has been imperiled.  The fee for any such examination shall be
 19 24 paid by the savings bank.
 19 25    e.  To the extent necessary for the purpose of any
 19 26 examination provided for by this section, examine all relevant
 19 27 books, records, accounts, and documents and compel the
 19 28 production of the same in the manner prescribed by section
 19 29 534.411.
 19 30    2.  The superintendent may furnish to the federal deposit
 19 31 insurance corporation, the federal reserve system, the office
 19 32 of the comptroller of the currency, the office of thrift
 19 33 supervision, the national credit union administration, the
 19 34 federal home loan bank, and financial institution regulatory
 19 35 authorities of other states, or to any official or supervising
 20  1 examiner of such regulatory authorities, a copy of the report
 20  2 of any or all examinations made of any savings bank and of any
 20  3 affiliate of a savings bank.
 20  4    3.  A copy of the report of each examination of a savings
 20  5 bank shall be transmitted by the superintendent to the board
 20  6 of directors of the savings bank except to the extent that the
 20  7 report of such examination may be confidential to the
 20  8 superintendent, and each member of the board of directors
 20  9 shall furnish to the superintendent, on forms to be supplied
 20 10 by the superintendent, a statement that the member has read
 20 11 the report of examination.
 20 12    4.  All reports of examinations, including any copies of
 20 13 such reports, in the possession of any person other than the
 20 14 superintendent or employee of the banking division, including
 20 15 any savings bank or any agency to which any report of such
 20 16 examination may be furnished under subsection 2, shall be
 20 17 confidential communications, shall not be subject to subpoena
 20 18 from such persons, and shall not be published or made public
 20 19 by such persons.
 20 20    5.  The report of examination of an affiliate or of a
 20 21 person examined as provided for in subsection 1, paragraph "c"
 20 22 or "d", shall not be transmitted by the superintendent to any
 20 23 such affiliate or person or to a savings bank or to the board
 20 24 of directors of a savings bank unless authorized or requested
 20 25 by such affiliate or person.
 20 26    Sec. 19.  NEW SECTION.  534.415  REGULATION AND EXAMINATION
 20 27 OF SERVICES.
 20 28    A savings bank shall not cause to be performed, by contract
 20 29 or otherwise, any bank services such as check and deposit
 20 30 sorting and posting, computation and posting of interest and
 20 31 other credits and charges, preparation and mailing of checks,
 20 32 statements, notices, and similar items, or other clerical,
 20 33 bookkeeping, accounting, statistical, or other similar
 20 34 functions for itself, whether on or off its premises, unless
 20 35 assurances satisfactory to the superintendent are furnished to
 21  1 the superintendent by both the savings bank and the person
 21  2 performing such services that the performance of such services
 21  3 will be subject to supervision, regulation, and examination by
 21  4 the superintendent to the same extent as if such services were
 21  5 being performed by the savings bank itself on its own
 21  6 premises.
 21  7    Sec. 20.  NEW SECTION.  534.416  FEES.
 21  8    A savings bank subject to examination, supervision, and
 21  9 regulation by the superintendent shall pay to the
 21 10 superintendent fees, established by the state banking board,
 21 11 based on the costs and expenses incurred in the discharge of
 21 12 the duties imposed upon the superintendent by this chapter.
 21 13 The fees shall include, but are not limited to, costs and
 21 14 expenses for salaries, expenses and travel for employees,
 21 15 office facilities, supplies, and equipment.
 21 16    The fees for examinations provided for in section 534.414,
 21 17 subsection 1, paragraphs "c" and "d", shall be established by
 21 18 the state banking board, based on the time required for the
 21 19 examination and the administrative costs and expenses incurred
 21 20 in the discharge of the duties imposed upon the superintendent
 21 21 by this chapter.  The fees shall include, but not be limited
 21 22 to, costs and expenses for salaries, expenses and travel for
 21 23 employees, office facilities, supplies, and equipment.
 21 24    Upon completion of each examination required or allowed by
 21 25 this chapter, the examiner in charge of the examination shall
 21 26 render a bill for the fees, in duplicate, and shall deliver
 21 27 one copy of the bill to the savings bank and one copy to the
 21 28 superintendent.
 21 29    Failure to pay the amount of the fees to the superintendent
 21 30 within ten days after the date of billing shall subject the
 21 31 savings bank to an additional charge equal to five percent of
 21 32 the amount of the fees for each day the payment is delinquent.
 21 33    Sec. 21.  NEW SECTION.  534.417  REPORTS TO SUPERINTENDENT.
 21 34    1.  A savings bank shall render a full, clear, and accurate
 21 35 statement of its condition to the superintendent, in a format
 22  1 prescribed by the superintendent, verified by the oath of an
 22  2 officer and attested by the signatures of at least three of
 22  3 the directors, or verified by the oath of two of its officers
 22  4 and attested to by two of the directors.  The superintendent
 22  5 may, in the superintendent's discretion, use any form of
 22  6 statement of condition that is used by the federal deposit
 22  7 insurance corporation or the federal reserve system.
 22  8    2.  The statement shall be transmitted to the
 22  9 superintendent or the superintendent's designee within thirty
 22 10 days after the end of each calendar quarter.
 22 11    3.  A savings bank shall cause the statement of condition
 22 12 filed for a calendar quarter which ends on June 30 to be
 22 13 published no later than the following August 15 and the
 22 14 statement of condition filed for a calendar quarter which ends
 22 15 on December 31 to be published no later than February 15 of
 22 16 the following year in a newspaper of general circulation in
 22 17 the municipal corporation or unincorporated area in which the
 22 18 savings bank has its principal place of business, or if there
 22 19 is none, in a newspaper of general circulation published in
 22 20 the county, or in a county adjoining the county, in which the
 22 21 savings bank has its principal place of business.  Proof of
 22 22 such publication by affidavit of the publisher of the
 22 23 newspaper in which it was made, shall be delivered to the
 22 24 superintendent and is conclusive evidence of the fact.
 22 25    4.  The superintendent shall also have power to call for
 22 26 special reports from a savings bank whenever in the
 22 27 superintendent's judgment such reports are necessary in order
 22 28 to obtain a full and complete knowledge of its condition.
 22 29 Such reports shall be verified and attested in the same manner
 22 30 as required in subsection 1.
 22 31    Sec. 22.  NEW SECTION.  534.418  MEETINGS OF THE BOARD OF
 22 32 DIRECTORS CALLED BY SUPERINTENDENT.
 22 33    The superintendent, as deemed necessary and advisable, may
 22 34 cause a meeting of the board of directors of a savings bank to
 22 35 be held in such manner and at such time and place as the
 23  1 superintendent may direct.  A report of an examination
 23  2 required or allowed by this chapter, any conclusions drawn
 23  3 from such report by the superintendent, any recommendations
 23  4 made relative to such report, and any other matters concerning
 23  5 the operation and condition of the savings bank may be
 23  6 presented to the board of directors by the superintendent.
 23  7 The savings bank shall cause the recommendations of the
 23  8 superintendent to be recorded in the minutes of the board of
 23  9 directors of the savings bank.
 23 10    Each member of the board of directors shall furnish to the
 23 11 superintendent a statement, on forms to be supplied by the
 23 12 superintendent, that the member has read and is familiar with
 23 13 the recommendations of the superintendent.
 23 14    Sec. 23.  NEW SECTION.  534.419  POWER OF SUPERINTENDENT TO
 23 15 ISSUE ORDERS.
 23 16    If it appears to the superintendent that a savings bank is
 23 17 engaging or has engaged, or the superintendent has reasonable
 23 18 cause to believe that the savings bank is about to engage, in
 23 19 an unsafe or unsound practice in conducting the business of
 23 20 the savings bank, or is violating or has violated, or the
 23 21 superintendent has reasonable cause to believe that the
 23 22 savings bank is about to violate, any provision of this
 23 23 chapter or of any rule adopted pursuant to this chapter, or
 23 24 any condition imposed in writing by the superintendent in
 23 25 connection with the approval of any matter required by this
 23 26 chapter, or any written agreement entered into with the
 23 27 superintendent, the superintendent may issue and serve upon
 23 28 the savings bank a notice containing a statement of the facts
 23 29 constituting the alleged violation, or the unsafe or unsound
 23 30 practice, and fixing a time and place at which a hearing will
 23 31 be held to determine whether an order to cease and desist from
 23 32 such practice should be issued to the savings bank.
 23 33    If the savings bank fails to appear at the hearing it is
 23 34 deemed to have consented to the issuance of a cease and desist
 23 35 order.  In the event of such consent, or if upon the record
 24  1 made at such hearing, the superintendent shall find that any
 24  2 violation or unsafe or unsound practice specified in the
 24  3 notice has been established, the superintendent may issue and
 24  4 serve upon the savings bank an order to cease and desist from
 24  5 any such violation or practice.  Such order may require the
 24  6 savings bank and its directors, officers, and employees to
 24  7 cease and desist from any such violation or practice and,
 24  8 further, to take affirmative action to correct the conditions
 24  9 resulting from any such violation or practice.
 24 10    An order issued pursuant to this section shall become
 24 11 effective upon service of the order on the savings bank and
 24 12 shall remain effective except to such extent that it is
 24 13 stayed, modified, terminated, or set aside by action of the
 24 14 superintendent or of the district court of the county in which
 24 15 the savings bank has its principal place of business.
 24 16    The superintendent may apply to the district court of the
 24 17 county in which the savings bank has its principal place of
 24 18 business for the enforcement of any order pursuant to this
 24 19 section and such court shall have jurisdiction and power to
 24 20 order and require compliance with the order.
 24 21    Sec. 24.  NEW SECTION.  534.420  GROUNDS FOR MANAGEMENT OF
 24 22 SAVINGS BANK BY SUPERINTENDENT.
 24 23    The superintendent may take over the management of the
 24 24 property and business of a savings bank whenever it appears to
 24 25 the superintendent that any of the following circumstances
 24 26 exist:
 24 27    1.  The savings bank has violated its articles of
 24 28 incorporation or any law of this state.
 24 29    2.  The capital of the savings bank is impaired.
 24 30    3.  The savings bank is conducting its business in an
 24 31 unsafe or unsound manner.
 24 32    4.  The savings bank is in such condition that it is
 24 33 unsound, unsafe, or inexpedient for it to transact business.
 24 34    5.  The savings bank has suspended or refused payment of
 24 35 its deposits or other liabilities contrary to the terms
 25  1 associated with such deposits.
 25  2    6.  The savings bank refuses to make its records available
 25  3 to the superintendent for examination or otherwise refuses to
 25  4 make available, through an officer or employee having
 25  5 knowledge of such records, information required by the
 25  6 superintendent for the proper discharge of the duties of the
 25  7 superintendent's office.
 25  8    7.  The savings bank neglects or refuses to observe any
 25  9 order of the superintendent made pursuant to the provisions of
 25 10 this chapter, unless the enforcement of such order is stayed
 25 11 in a proceeding brought by the savings bank.
 25 12    8.  The savings bank has not transacted any business or
 25 13 performed any of the duties, contemplated by its authorization
 25 14 to do business, for a period of one year.
 25 15    The superintendent shall manage the property and business
 25 16 of the savings bank until such time as the superintendent may
 25 17 relinquish to the savings bank the management of the savings
 25 18 bank, upon such conditions as the superintendent may
 25 19 prescribe, or until its affairs are finally dissolved as
 25 20 provided in this chapter.
 25 21    Sec. 25.  NEW SECTION.  534.421  PROCEDURES – JUDICIAL
 25 22 REVIEW.
 25 23    Judicial review of the actions of the superintendent may be
 25 24 sought pursuant to chapter 17A.  However, contested case
 25 25 provisions of chapter 17A, the Iowa administrative procedure
 25 26 Act, do not apply to an action by the superintendent to take
 25 27 over the management of or to manage a savings bank, as
 25 28 authorized by sections 534.420 and 534.422.
 25 29    Sec. 26.  NEW SECTION.  534.422  MANAGEMENT OF SAVINGS BANK
 25 30 BY SUPERINTENDENT.
 25 31    Upon taking over the management of the property and
 25 32 business of a savings bank, the superintendent shall have the
 25 33 authority to operate and direct the affairs of the savings
 25 34 bank in its regular course of business.  The superintendent
 25 35 shall also have the authority to collect such amounts due to
 26  1 the savings bank and to do such other acts as are necessary or
 26  2 expedient to conduct the affairs of the savings bank and
 26  3 conserve or protect its assets, property, and business.
 26  4    If, upon taking over the management of the business and
 26  5 property of the savings bank, the superintendent concludes
 26  6 that the savings bank is insolvent or should be dissolved for
 26  7 any other reason enumerated in section 534.420, the
 26  8 superintendent may immediately, or at any time within three
 26  9 years, order that the savings bank cease to carry on its
 26 10 business and proceed to dissolve the affairs of the savings
 26 11 bank pursuant to this chapter.  If the superintendent has not
 26 12 caused the savings bank to cease to carry on its business
 26 13 within three years of taking over the management of the
 26 14 property and business of the savings bank, the superintendent
 26 15 shall relinquish the management of such property and business
 26 16 of the savings bank to the savings bank.
 26 17    The superintendent may appoint one or more special deputies
 26 18 as agent or agents, with powers specified in the certificate
 26 19 of appointment, to assist the superintendent in the duty of
 26 20 management, conservation, or dissolution and distribution of
 26 21 the business and property of a savings bank.
 26 22    The superintendent, during the period of the
 26 23 superintendent's management of the property and business of
 26 24 the savings bank, and prior to such time as the superintendent
 26 25 may apply to the district court for appointment as receiver,
 26 26 may require reimbursement by the savings bank to the extent of
 26 27 the expenses incurred by the superintendent in connection with
 26 28 such management.
 26 29    Sec. 27.  NEW SECTION.  534.423  INTERIM CEASE AND DESIST
 26 30 ORDER – FINAL ORDER – SUSPENSION.
 26 31    1.  If it appears to the superintendent that a savings
 26 32 bank, or any director, officer, employee, or substantial
 26 33 shareholder of the savings bank, is engaging in or is about to
 26 34 engage in an unsafe or unsound practice or dishonest act in
 26 35 conducting the business of the savings bank that is likely to
 27  1 cause insolvency or substantial dissipation of assets or
 27  2 earnings of the savings bank, or is likely to seriously weaken
 27  3 the condition of the savings bank or otherwise seriously
 27  4 prejudice the interests of its depositors prior to the
 27  5 completion of the proceedings conducted pursuant to section
 27  6 534.421 or 534.606, the superintendent may issue an interim
 27  7 order requiring the savings bank, director, officer, employee,
 27  8 or substantial shareholder to cease and desist from any such
 27  9 practice or act, and to take affirmative action, including
 27 10 suspension of the director, officer, or employee to prevent
 27 11 such insolvency, dissipation, condition, or prejudice pending
 27 12 completion of the proceedings.  The interim order becomes
 27 13 effective upon service upon the savings bank, or upon the
 27 14 director, officer, employee, or substantial shareholder of the
 27 15 savings bank and, unless set aside, limited, or suspended by a
 27 16 court as provided in this chapter, remains effective and
 27 17 enforceable pending the completion of the administrative
 27 18 proceedings pursuant to the interim order and until such time
 27 19 as the superintendent dismisses the charges specified in the
 27 20 interim order, or, if a final cease and desist order is issued
 27 21 against the savings bank or the director, officer, employee,
 27 22 or substantial shareholder, until the effective date of the
 27 23 final order.
 27 24    2.  Within ten days after the savings bank concerned or any
 27 25 director, officer, employee, or substantial shareholder is
 27 26 served with an interim order, the savings bank or such
 27 27 director, officer, employee, or substantial shareholder may
 27 28 apply to the district court in the county in which the savings
 27 29 bank has its principal place of business, for an injunction
 27 30 setting aside, limiting, or suspending the enforcement,
 27 31 operation, or effectiveness of such interim order pending the
 27 32 completion of the administrative proceedings.  If serious
 27 33 prejudice to the interests of the superintendent, the savings
 27 34 bank, the officer, director, employee, or substantial
 27 35 shareholder would result from such hearing, the court may
 28  1 order the judicial proceeding to be conducted in camera.
 28  2    3.  The interim order shall contain a concise statement of
 28  3 the facts constituting the alleged unsafe or unsound practice
 28  4 or alleged dishonest act, and shall fix a time and place at
 28  5 which a hearing will be held to determine whether a final
 28  6 order to cease and desist should issue against the savings
 28  7 bank or any director, officer, employee, or substantial
 28  8 shareholder.  The hearing shall be fixed for a date not later
 28  9 than thirty days after service of the interim order unless a
 28 10 later date is set at the request of the party so served.  If
 28 11 the savings bank, or the director, officer, employee, or
 28 12 substantial shareholder fails to appear at the hearing, the
 28 13 savings bank, or the director, officer, employee, or
 28 14 substantial shareholder is deemed to have consented to the
 28 15 issuance of a cease and desist order.  In the event of such
 28 16 consent, or if upon the record made at the hearing the
 28 17 superintendent finds that any unsafe or unsound practice or
 28 18 dishonest act specified in the interim order has been
 28 19 established, the superintendent may issue and serve upon the
 28 20 savings bank, or the director, officer, employee, or
 28 21 substantial shareholder a final order to cease and desist from
 28 22 any such practice or act.  The order may require the savings
 28 23 bank, or the director, officer, employee, or substantial
 28 24 shareholder to cease and desist from any such practice or act
 28 25 and, further, to take affirmative action, including suspension
 28 26 of the director, officer, or employee.
 28 27    4.  A hearing provided for in this section shall be
 28 28 presided over by an administrative law judge appointed
 28 29 pursuant to section 17A.11.  The hearing shall be private,
 28 30 unless the superintendent determines after full consideration
 28 31 of the views of the party afforded the hearing, that a public
 28 32 hearing is necessary to protect the public interest.  After
 28 33 the hearing, and within thirty days after the case has been
 28 34 submitted for decision, the superintendent shall review the
 28 35 proposed order of the administrative law judge and render a
 29  1 final decision, including findings of fact upon which the
 29  2 decision is predicated, and issue and serve upon each party to
 29  3 the proceeding an order consistent with this section.
 29  4    5.  A final order issued by the superintendent pursuant to
 29  5 subsection 3 becomes effective upon service of the final order
 29  6 on the savings bank, director, officer, employee, or
 29  7 substantial shareholder and remains effective except to the
 29  8 extent that it is stayed, modified, terminated, or set aside
 29  9 by action of the superintendent or of the district court of
 29 10 the county in which the savings bank has its principal place
 29 11 of business pursuant to chapter 17A.
 29 12    6.  In the case of violation or threatened violation of, or
 29 13 failure to obey, an interim order issued pursuant to
 29 14 subsection 1 or a final order issued pursuant to subsection 3,
 29 15 the superintendent may apply to the district court of the
 29 16 county in which the savings bank has its principal place of
 29 17 business for the enforcement of the order and such court shall
 29 18 have jurisdiction and power to order and require compliance
 29 19 with the interim order or final order.
 29 20    7.  For purposes of this section, "substantial shareholder"
 29 21 means a shareholder exercising a controlling influence over
 29 22 the management or policies of a savings bank as determined by
 29 23 the superintendent.
 29 24    Sec. 28.  NEW SECTION.  534.424  INVOLUNTARY DISSOLUTION
 29 25 AFTER COMMENCEMENT OF BUSINESS – SUPERINTENDENT AS RECEIVER.
 29 26    In a situation in which the superintendent has required,
 29 27 pursuant to section 534.422, that the savings bank cease to
 29 28 carry on its business, the superintendent shall apply to the
 29 29 district court for the county in which the savings bank is
 29 30 located for appointment as receiver for the savings bank.  The
 29 31 district court shall appoint the superintendent as receiver
 29 32 unless the superintendent has tendered the appointment to the
 29 33 federal deposit insurance corporation as provided for in
 29 34 section 534.427, in which case the district court shall
 29 35 appoint the federal deposit insurance corporation as receiver.
 30  1 The affairs of the savings bank shall be under the direction
 30  2 of the district court, and the assets of the savings bank
 30  3 shall be distributed pursuant to section 534.426.  All amounts
 30  4 due creditors and shareholders described in section 490.1440
 30  5 shall be deposited with the treasurer of state pursuant to
 30  6 that section.  Such amounts shall be retained by the treasurer
 30  7 of state and subject to claim in the manner provided for in
 30  8 section 490.1440.  Amounts due to depositors who are unknown,
 30  9 or who are under a disability and there is no person legally
 30 10 competent to receive the amount, or who cannot be found after
 30 11 the exercise of reasonable diligence, shall be transmitted to
 30 12 the treasurer of state as abandoned, retained by the treasurer
 30 13 of state, and is subject to claim, in the manner provided for
 30 14 in sections 556.14 through 556.21.  The attorney general, or
 30 15 assistants appointed by the court, shall represent the
 30 16 superintendent in all proceedings connected with the
 30 17 receivership.
 30 18    Sec. 29.  NEW SECTION.  534.425  INVOLUNTARY DISSOLUTION
 30 19 AFTER COMMENCEMENT OF BUSINESS – RECEIVERSHIP PROCEDURE.
 30 20    1.  In all situations in which the superintendent has been
 30 21 named the receiver as provided in section 534.424, the
 30 22 superintendent shall make a diligent effort to collect and
 30 23 realize on the assets of the savings bank, and make
 30 24 distribution of the proceeds from time to time to those
 30 25 entitled to such proceeds.  The superintendent may execute
 30 26 assignments, releases, and satisfactions to effectuate sales
 30 27 and transfers as receiver or after the receivership has
 30 28 terminated.  Upon the order of the court in which the
 30 29 receivership is pending, the superintendent may sell or
 30 30 compound all bad or doubtful debts, and, on a like order, may
 30 31 sell all the real and personal property of the savings bank,
 30 32 on such terms as the court shall direct.
 30 33    2.  All expenses of the receivership and dissolution shall
 30 34 be fixed by the superintendent, subject to the approval of the
 30 35 district court, and shall be paid out of the assets of the
 31  1 savings bank.
 31  2    3.  At the termination of the receivership, the
 31  3 superintendent shall file a final report containing the
 31  4 details of the superintendent's actions as receiver, together
 31  5 with such additional facts as the court may require.
 31  6    4.  Upon the submission and approval of the final report,
 31  7 the court shall enter a decree dissolving the savings bank and
 31  8 the corporate existence of the savings bank shall cease.  The
 31  9 clerk of the district court shall cause certified copies of
 31 10 the decree to be filed with and recorded by the secretary of
 31 11 state and the county recorder of the county in which the
 31 12 savings bank is located.  A fee shall not be charged by the
 31 13 secretary of state or the county recorder for the filing or
 31 14 recording of the decree.
 31 15    Sec. 30.  NEW SECTION.  534.426  DISTRIBUTION OF ASSETS
 31 16 UPON INSOLVENCY.
 31 17    In the distribution of the assets of a savings bank which
 31 18 is dissolved under this chapter, or by any other method, the
 31 19 order of payment of the liabilities of the savings bank, in
 31 20 the event that its assets are insufficient to pay in full all
 31 21 its liabilities for which claims are made, shall be as
 31 22 follows:
 31 23    1.  The payment of costs and expenses of the administration
 31 24 of the dissolution.
 31 25    2.  The payment of claims for public funds deposited
 31 26 pursuant to chapter 12C and the payment of claims which are
 31 27 given priority by applicable statutes.  If the assets are
 31 28 insufficient for payment of the claims in full, priority shall
 31 29 be determined as specified by the statutes or, in the absence
 31 30 of conflicting provisions, on a pro rata basis.
 31 31    3.  Amounts due to depositors.
 31 32    4.  The payment of all other claims pro rata, exclusive of
 31 33 claims on capital notes and debentures.
 31 34    5.  The payment of capital notes and debentures.
 31 35    Sec. 31.  NEW SECTION.  534.427  INVOLUNTARY DISSOLUTION
 32  1 AFTER COMMENCEMENT OF BUSINESS – TENDER OF RECEIVERSHIP TO
 32  2 FEDERAL DEPOSIT INSURANCE CORPORATION.
 32  3    1.  When an insured savings bank has ceased to carry on its
 32  4 business, the superintendent may tender to the federal deposit
 32  5 insurance corporation the appointment as receiver of the
 32  6 insured savings bank.  If the federal deposit insurance
 32  7 corporation accepts the appointment as receiver, the rights of
 32  8 depositors and other creditors of the insured savings bank
 32  9 shall be determined pursuant to the laws of this state.
 32 10    2.  The federal deposit insurance corporation as receiver
 32 11 shall possess all the powers, rights, and privileges given to
 32 12 the superintendent under section 534.425, except as that
 32 13 section may be in conflict with the laws of the United States.
 32 14    3.  If the federal deposit insurance corporation pays or
 32 15 makes available for payment the insured deposit liabilities of
 32 16 an insured savings bank, the federal deposit insurance
 32 17 corporation, whether or not it has become receiver, shall be
 32 18 subrogated by operation of law to all rights against such
 32 19 insured savings bank of the owners of such deposits in the
 32 20 same manner and to the same extent as subrogation of the
 32 21 federal deposit insurance corporation is provided for in
 32 22 applicable federal law in the case of a national bank.
 32 23    Sec. 32.  NEW SECTION.  534.428  SURVIVAL OF RIGHTS AND
 32 24 REMEDIES AFTER DISSOLUTION OR EXPIRATION – PRESERVATION OF
 32 25 RECORDS.
 32 26    1.  The dissolution of a savings bank, or the expiration of
 32 27 its period of duration, shall not take away or impair any
 32 28 remedy available to or against such savings bank, its
 32 29 directors, officers, or shareholders, for any right or claim
 32 30 existing, or any liability incurred prior to such dissolution
 32 31 or expiration, if action or other proceeding is commenced
 32 32 within two years after the date of such dissolution or
 32 33 expiration.  An action or proceeding by or against the savings
 32 34 bank may be prosecuted or defended by the savings bank in its
 32 35 corporate name.  The shareholders, directors, and officers
 33  1 shall have power to take such corporate or other action as is
 33  2 appropriate to protect such remedy, right, or claim.
 33  3    2.  Subsequent to the dissolution of a savings bank, other
 33  4 than through the adoption of a plan involving a provision for
 33  5 acquisition of its assets and assumption of its liabilities by
 33  6 another savings bank, national bank, or other financial
 33  7 institution insured by the federal deposit insurance
 33  8 corporation, the superintendent may assume custody of the
 33  9 records of the savings bank and, if so, shall retain them
 33 10 pursuant to section 534.106.
 33 11    Sec. 33.  Section 534.507, Code 1997, is amended by
 33 12 striking the section and inserting in lieu thereof the
 33 13 following:
 33 14    534.507  NAME.
 33 15    The name of a savings bank shall contain the words "savings
 33 16 bank" or "bank" to the same extent authorized for federal
 33 17 associations under 12 U.S.C. } 1464, and regulations adopted
 33 18 pursuant to that section, except that the word "federal" or
 33 19 the designation "fsb" shall not be used.
 33 20    Sec. 34.  Section 534.508, subsections 2 and 4, Code 1997,
 33 21 are amended by striking the subsections.
 33 22    Sec. 35.  Section 534.508, Code 1997, is amended by adding
 33 23 the following new subsections:
 33 24    NEW SUBSECTION.  5.  MINIMUM CAPITAL.
 33 25    a.  The minimum capital structure of a savings bank shall
 33 26 not be less than the amount required by the federal deposit
 33 27 insurance corporation, or its successor, or a greater amount
 33 28 which the superintendent deems necessary in view of the
 33 29 deposit potential of the savings bank and current banking
 33 30 standards relating to total capital requirements.
 33 31    b.  A savings bank, prior to receiving authorization to do
 33 32 business from the superintendent, shall establish paid-in
 33 33 surplus and undivided profits as required by the
 33 34 superintendent.
 33 35    NEW SUBSECTION.  6.  CAPITAL NOTES AND DEBENTURES.
 34  1    a.  A savings bank, with the prior approval of the
 34  2 superintendent and the affirmative vote of the holders of a
 34  3 majority of the shares entitled to vote, may issue capital
 34  4 notes or debentures.  The amounts, maturities, rate of
 34  5 interest, relative rights with other creditors, and other
 34  6 terms and conditions shall be set forth on the face of the
 34  7 capital notes or debentures or in an attendant agreement, and
 34  8 all terms and conditions are subject to the prior approval of
 34  9 the superintendent provided that all such capital notes and
 34 10 debentures shall be subordinated to the rights of other
 34 11 persons to the extent provided for in section 534.426.  The
 34 12 aggregate amount of all capital notes and debentures issued
 34 13 and outstanding pursuant to this section shall not exceed, at
 34 14 any one time, twenty-five percent of the aggregate capital of
 34 15 the savings bank.
 34 16    b.  A savings bank shall not make any payment of principal
 34 17 on any capital notes or debentures, without the prior approval
 34 18 of the superintendent, or make any payment of principal and
 34 19 interest on any such capital or debentures when its capital is
 34 20 impaired or which would cause its capital to become impaired.
 34 21 Subject to this section, a savings bank may issue capital
 34 22 notes or debentures with provision for installment or serial
 34 23 payment of capital notes or debentures according to an
 34 24 established schedule which shall be approved by the
 34 25 superintendent prior to issuance.
 34 26    c.  A savings bank shall not issue capital notes or
 34 27 debentures within five years after it is originally authorized
 34 28 to do business.
 34 29    NEW SUBSECTION.  7.  INCREASE OR DECREASE OF CAPITAL
 34 30 STRUCTURE.
 34 31    a.  A savings bank, with the approval of the
 34 32 superintendent, may increase its capital structure or effect
 34 33 an allocation of amounts within its capital structure, by the
 34 34 use of any of the following methods:
 34 35    (1)  Sale of authorized but unissued shares.
 35  1    (2)  Transfer of surplus or undivided profits to capital
 35  2 for authorized but unissued shares.
 35  3    (3)  Transfer of undivided profits to surplus.
 35  4    (4)  Authorization and issuance of common shares, preferred
 35  5 shares, or capital notes or debentures.
 35  6    b.  The superintendent, whenever it appears necessary to do
 35  7 so in the interest of the safety of the deposits of a savings
 35  8 bank, may require that the capital structure of the savings
 35  9 bank be increased by either of the methods provided for in
 35 10 paragraph "a", subparagraphs (1) and (4).
 35 11    c.  Capital or surplus shall not be decreased except with
 35 12 the approval of the superintendent.
 35 13    NEW SUBSECTION.  8.  REVERSE STOCK SPLIT.
 35 14    A savings bank may effect a reverse stock split or similar
 35 15 change in capital structure by renewal, amendment, or
 35 16 restatement of existing articles of incorporation, provided
 35 17 the requirements of the superintendent are satisfied.
 35 18    NEW SUBSECTION.  9.  DIVIDENDS.
 35 19    a.  The board of directors of a savings bank, from time to
 35 20 time, may declare, and the savings bank may pay, dividends on
 35 21 its outstanding shares subject to the restrictions of this
 35 22 chapter and to the restrictions, if any, in its articles of
 35 23 incorporation.  Dividends may be declared and paid only out of
 35 24 undivided profits and may be paid in cash or property.
 35 25    b.  A dividend shall not be declared or paid if restricted
 35 26 by the superintendent.
 35 27    NEW SUBSECTION.  10.  DISTRIBUTION OF SHARES OF SAVINGS
 35 28 BANK.
 35 29    The board of directors of a savings bank, subject to
 35 30 subsection 7, may distribute pro rata to holders of common
 35 31 shares authorized but unissued common shares of the savings
 35 32 bank.  A distribution shall not be made in authorized but
 35 33 unissued shares of the savings bank unless an amount equal to
 35 34 the total par value of the shares distributed is transferred
 35 35 to capital.
 36  1    NEW SUBSECTION.  11.  OPTIONS FOR SHARES.
 36  2    A savings bank may authorize the granting of options to
 36  3 officers and employees to purchase unissued shares of the
 36  4 savings bank pursuant to a plan approved by the
 36  5 superintendent.
 36  6    Sec. 36.  Section 534.509, subsections 1 through 6, 9, and
 36  7 11, Code 1997, are amended to read as follows:
 36  8    1.  TYPES AUTHORIZED.  The following types of conversions
 36  9 are authorized:
 36 10    a.  Mutual association savings bank to stock association
 36 11 savings bank.
 36 12    b.  Stock association savings bank to mutual association
 36 13 savings bank.
 36 14    c.  Mutual association savings bank or stock association
 36 15 savings bank to federal mutual association or federal stock
 36 16 association an insured depository institution as defined in 12
 36 17 U.S.C. } 1813(c)(2).
 36 18    d.  Federal mutual association or federal stock association
 36 19 An insured depository institution as defined in 12 U.S.C. }
 36 20 1813(c)(2) to a mutual association or stock association.
 36 21    e.  Stock association to a bank chartered under chapter
 36 22 524.
 36 23    2.  INSURANCE.  The organization must be either an insured
 36 24 association, a federal association, or an insured bank by the
 36 25 federal deposit insurance corporation after any conversion.
 36 26    3.  PLAN OF CONVERSION.  The board of directors shall
 36 27 approve a plan of conversion by a majority vote of all
 36 28 directors then serving.  The plan shall include the following:
 36 29    a.  The proposed restated articles of incorporation.
 36 30    b.  The proposed restated bylaws.
 36 31    c.  The effect of the conversion on each type of member or
 36 32 each class of stockholders.
 36 33    d.  Other information the superintendent of savings and
 36 34 loan associations requires.
 36 35    e.  If the conversion is to a bank, information required by
 37  1 the superintendent of banking.
 37  2    4.  SUPERINTENDENT OF SAVINGS AND LOAN ASSOCIATIONS'
 37  3 SUPERINTENDENT'S APPROVAL – CONVERSION TO SAVINGS BANK.  The
 37  4 plan of conversion shall be submitted to the superintendent
 37  5 for approval.  The superintendent shall reject the plan based
 37  6 on any of the following determinations:
 37  7    a.  The plan is inconsistent with applicable statutes or
 37  8 regulations.
 37  9    b.  The plan does not contain all required information.
 37 10    c.  The plan is inequitable to a class of members or
 37 11 shareholders.
 37 12    The superintendent shall notify the organization which
 37 13 submitted the plan of the superintendent's decision, and the
 37 14 reasons for rejection if the plan is rejected.  The
 37 15 organization converting to a savings bank shall be permitted
 37 16 to retain all of its existing branches, the power and
 37 17 authority to engage in activities in the same manner as
 37 18 immediately prior to the conversion, and the right to use its
 37 19 name, except that the designation "fsb" or the word "federal"
 37 20 shall not be used.
 37 21    5.  SUPERINTENDENT OF BANKING'S SUPERINTENDENT'S APPROVAL
 37 22 – CONVERSION TO BANK.  The plan of conversion shall be
 37 23 submitted to the superintendent of banking for approval if the
 37 24 conversion is to a bank.  The superintendent of banking shall
 37 25 reject the plan based on any of the following determinations:
 37 26    a.  The plan is inconsistent with applicable statutes or
 37 27 regulations.
 37 28    b.  The plan does not contain all required information.
 37 29    c.  The character and fitness of the members of the initial
 37 30 board of directors is not such as to command the confidence of
 37 31 the community and to warrant the belief that the
 37 32 organization's business will be honestly and efficiently
 37 33 conducted.
 37 34    d.  The capital structure of the organization is not
 37 35 adequate in relation to its anticipated business.
 38  1    e.  The organization will not have sufficient personnel
 38  2 with adequate knowledge and experience to conduct its business
 38  3 and administer any fiduciary accounts which it proposes to
 38  4 handle.
 38  5    f.  The plan does not provide for the closing or sale of
 38  6 all of the offices which must be discontinued in order for the
 38  7 organization to have only those home and branch offices which
 38  8 a bank is allowed to have under chapter 524.
 38  9    The superintendent of banking shall notify the organization
 38 10 which submitted the plan of the superintendent's decision, and
 38 11 the reasons for rejection if the plan is rejected.  The
 38 12 organization may amend and resubmit the plan in response to a
 38 13 notification of rejection.
 38 14    6.  MEMBER OR STOCKHOLDER APPROVAL.  The plan of conversion
 38 15 must be approved at an annual meeting of members or
 38 16 stockholders, or at a special meeting called to consider the
 38 17 plan, by a majority vote of the members represented in person
 38 18 or by proxy if a mutual association savings bank or federal
 38 19 mutual association, or a majority vote of each class of voting
 38 20 stock represented in person or by proxy if a stock association
 38 21 or savings bank, federal stock association, bank, or national
 38 22 bank.
 38 23    If the proposed conversion is the conversion of a mutual
 38 24 association savings bank to a stock association savings bank,
 38 25 the board of directors shall cause written notice of the date,
 38 26 time and purpose of the meeting at which the members will be
 38 27 asked to vote on the proposal to be mailed by first class
 38 28 mail, postage prepaid, to each member of the association
 38 29 savings bank not less than thirty days prior to the date of
 38 30 the meeting, and the board shall cause a copy of this notice
 38 31 to be posted in a conspicuous location in each of the
 38 32 association's savings bank's offices from the date of mailing
 38 33 until the date of the meeting.  The notice to be mailed to
 38 34 members and posted also shall give notice, in a form and
 38 35 manner to be prescribed by rule of the superintendent, the
 39  1 rights of a member to have access to and communicate with
 39  2 other members as provided in section 534.404, subsection 2 and
 39  3 the procedures that are to be followed under that provision.
 39  4 The mailed notice may be included in an envelope containing a
 39  5 periodic statement of account to the member.  The
 39  6 superintendent may require that the date for the meeting of
 39  7 members be postponed to a date certain, not more than thirty
 39  8 days after the date originally prescribed, if the
 39  9 superintendent determines that such additional time is
 39 10 necessary to enable members who have requested to communicate
 39 11 with other members under section 534.404, subsection 2, to
 39 12 properly exercise that right.
 39 13    If the proposed conversion is the conversion of a stock
 39 14 association savings bank to any other type of entity, the
 39 15 board of directors shall cause written notice of the proposed
 39 16 conversion and the earliest date when the proposed conversion
 39 17 might become effective to be posted in a conspicuous location
 39 18 in each of the association's savings bank's offices commencing
 39 19 thirty days prior to the date of the shareholder's meeting at
 39 20 which the proposal will be voted upon and until thirty days
 39 21 after that date.
 39 22    If the proposed conversion is the conversion of a bank to a
 39 23 stock savings bank, the board of directors shall cause written
 39 24 notice of the proposed conversion and the earliest date when
 39 25 the proposed conversion might become effective to be posted in
 39 26 a conspicuous location in each of the bank's offices
 39 27 commencing thirty days prior to the date of the shareholder's
 39 28 meeting at which the proposal will be voted upon and until
 39 29 thirty days after that date.
 39 30    If the plan of conversion is approved, a copy of the
 39 31 minutes of the meeting, certified and acknowledged by the
 39 32 secretary or assistant secretary, shall be filed with the
 39 33 superintendent.
 39 34    9.  CONVERSION TO A BANK.  If a bank results from the plan
 39 35 of conversion, the association savings bank shall cease to be
 40  1 an association a savings bank and shall no longer be subject
 40  2 to the supervision and control of the superintendent this
 40  3 chapter when all of the following have occurred:
 40  4    a.  The superintendent has received from the superintendent
 40  5 of banking a certificate showing that the organization is
 40  6 chartered as a bank.
 40  7    b. a.  The superintendent has approved the plan of
 40  8 conversion.
 40  9    c. b.  The superintendent has received the certified
 40 10 minutes of approval under subsection 6.
 40 11    11.  COMPETITION PRESERVED.  A conversion of an association
 40 12 a savings bank to a bank under this section shall not prevent
 40 13 the subsequent incorporation of another bank in the same
 40 14 community, and the superintendent of banking shall not find
 40 15 the existence of the bank resulting from the conversion to be
 40 16 grounds for disapproving the incorporation of another bank in
 40 17 the same community under section 524.305, subsection 1,
 40 18 paragraph "b" or "c".  A conversion of an association a
 40 19 savings bank to a bank under this section shall not prevent
 40 20 the subsequent incorporation of another association savings
 40 21 bank in the same community, and the superintendent of savings
 40 22 and loan associations shall not find the existence of the bank
 40 23 resulting from the conversion to be grounds for disapproving
 40 24 the incorporation of another association savings bank in the
 40 25 same community under this chapter.
 40 26    Sec. 37.  Section 534.511, subsections 4 and 5, Code 1997,
 40 27 are amended to read as follows:
 40 28    4.  SUPERINTENDENT OF SAVINGS AND LOAN ASSOCIATIONS'
 40 29 SUPERINTENDENT'S APPROVAL – MERGER INTO SAVINGS BANK.  The
 40 30 plan of merger shall be submitted to the superintendent of
 40 31 savings and loan associations for approval.  The
 40 32 superintendent shall reject the plan based on any of the
 40 33 following determinations:
 40 34    a.  The plan is inconsistent with applicable statutes or
 40 35 regulations.
 41  1    b.  The plan does not contain all required information.
 41  2    c.  The plan is inequitable to a class of members or
 41  3 stockholders.
 41  4    The superintendent shall notify the organizations which
 41  5 submitted the plan of the superintendent's decision, and the
 41  6 reasons for rejection if the plan is rejected.
 41  7    5.  SUPERINTENDENT OF BANKING'S SUPERINTENDENT'S APPROVAL
 41  8 – MERGER INTO BANK.  The plan of merger shall be submitted to
 41  9 the superintendent of banking for approval if.  If the
 41 10 proposed merger is with or into a bank or bank holding
 41 11 company.  The, the superintendent of banking shall reject the
 41 12 plan based on any of the following determinations:
 41 13    a.  The plan is inconsistent with applicable statutes or
 41 14 regulations.
 41 15    b.  The plan does not contain all required information.
 41 16    c.  The capital structure of the resulting organization
 41 17 will not be adequate in relation to its anticipated business.
 41 18    d.  The plan does not provide for the closing or sale of
 41 19 all of the offices which must be discontinued in order for the
 41 20 resulting organization to have only those office locations
 41 21 which a resulting bank would be authorized under chapter 524
 41 22 to apply for and have approved on the effective date of the
 41 23 merger if it had no bank office locations in operation on that
 41 24 date.
 41 25    The superintendent of banking shall notify the organization
 41 26 which submitted the plan of the superintendent of banking's
 41 27 superintendent's decision, and the reasons for rejection if
 41 28 the plan is rejected.  The organization may amend and resubmit
 41 29 the plan in response to a notification of rejection.
 41 30    Sec. 38.  Section 534.515, subsection 13, Code 1997, is
 41 31 amended to read as follows:
 41 32    13.  REVOCATION OF CERTIFICATE – RECEIVER.  If any such
 41 33 building and loan association holding a certificate of
 41 34 authority to transact business within this state issued by the
 41 35 superintendent as provided in this chapter, shall violate any
 42  1 of the provisions of this chapter, or shall fail to deposit
 42  2 with the superintendent such further amount of mortgages or
 42  3 securities as the superintendent may require under this
 42  4 chapter, the superintendent shall at once revoke the
 42  5 certificate and notify the executive council of its
 42  6 revocation; and under the direction of the executive council,
 42  7 application shall be made by the attorney general to the
 42  8 proper court for the appointment of a receiver to wind up the
 42  9 affairs of the association.  In the proceedings the amount due
 42 10 from the borrowing members or persons making periodical
 42 11 payments upon contracts or mortgages given by them shall be
 42 12 ascertained in the manner provided in section 534.405 as
 42 13 provided in chapter 534; and the amount owing upon mortgages
 42 14 or contracts from members of the association or persons making
 42 15 periodical payments to it, shall be treated and considered as
 42 16 due and payable within a reasonable time, to be fixed by the
 42 17 court after the appointment of a receiver.
 42 18    Sec. 39.  Section 534.519, subsection 2, Code 1997, is
 42 19 amended to read as follows:
 42 20    2.  A mutual holding company shall be deemed a mutual
 42 21 association for purposes of sections 534.401, 534.403,
 42 22 534.501, 534.502, 534.503, 534.505, 534.509, 534.510, 534.511,
 42 23 534.512, 534.513, 534.514, 534.601, 534.602, 534.603, 534.604,
 42 24 534.605, 534.606, 534.701, 534.702, 534.703, 534.704, and
 42 25 534.705.
 42 26    Sec. 40.  Section 535B.11, subsection 3, unnumbered
 42 27 paragraph 2, Code 1997, is amended to read as follows:
 42 28    Compliance with sections 524.905, 533.16, 534.206, and
 42 29 536A.20 shall constitute compliance with this subsection.
 42 30    Sec. 41.  Section 537.2305, subsection 1, Code 1997, is
 42 31 amended to read as follows:
 42 32    1.  For the purpose of discovering violations of this
 42 33 chapter or securing information lawfully required, the
 42 34 licensing authority shall examine periodically at intervals
 42 35 the licensing authority deems appropriate, but not less
 43  1 frequently than is required for other examinations of the
 43  2 licensee by section 524.217, 533.6, 534.401, 536.10, or
 43  3 536A.15, whichever is applicable, the loans, business, and
 43  4 records of every licensee, except a licensee which has no
 43  5 office physically located in this state and engages in no
 43  6 face-to-face solicitation in this state.  In addition, the
 43  7 licensing authority may at any time investigate the loans,
 43  8 business, and records of any lender.  For these purposes the
 43  9 licensing authority shall be given free and reasonable access
 43 10 to the offices, places of business, and records of the lender.
 43 11    Sec. 42.  Section 546.5, Code 1997, is amended to read as
 43 12 follows:
 43 13    546.5  SAVINGS AND LOAN BANK DIVISION.
 43 14    The savings and loan bank division shall regulate and
 43 15 supervise savings and loan associations and savings banks
 43 16 under chapter 534.  The division is headed by the
 43 17 superintendent of savings and loan associations who shall be
 43 18 appointed pursuant to section 534.401 banking.
 43 19    Sec. 43.  Sections 534.104, 534.107, 534.108, 534.112,
 43 20 534.205, 534.206, 534.401 through 534.408, Code 1997, are
 43 21 repealed.
 43 22    Sec. 44.  DIRECTIONS TO CODE EDITOR.  The Code Editor is
 43 23 directed to review sections of chapter 534 and other sections
 43 24 citing chapter 534 or referring to savings and loan
 43 25 associations for the purpose of amending such sections and
 43 26 including such amendments in the substantive Code editor's
 43 27 bill to be introduced during the 1999 regular session or in
 43 28 another bill if deemed appropriate.
 43 29    Sec. 45.  EFFECTIVE DATE.  This Act, other than section 39
 43 30 of this Act, takes effect July 1, 1999.  
 43 31                           EXPLANATION
 43 32    This bill amends Code chapter 534 by providing that the
 43 33 chapter shall apply to savings banks instead of savings and
 43 34 loan associations.  The bill adds new sections for the purpose
 43 35 of regulating savings banks in a manner similar to state banks
 44  1 under Code chapter 524.  The bill adds new language relating
 44  2 to fiduciary powers of a savings bank including actions
 44  3 required, permitted, or prohibited in a fiduciary capacity,
 44  4 removal of fiduciary powers, voluntary relinquishment of
 44  5 fiduciary capacity, and depositing securities in a federally
 44  6 regulated corporation; language relating to the regulatory
 44  7 authority of the superintendent of banking over savings banks
 44  8 including the duties and powers of the superintendent,
 44  9 subpoena and contempt powers, records requirements of the
 44 10 division of banking, required annual report of the
 44 11 superintendent, examination authority of the superintendent
 44 12 over savings banks, permissible fees associated with
 44 13 examinations, reports required to be submitted to the
 44 14 superintendent, meetings of the board of directors of a
 44 15 savings bank called by the superintendent, power of the
 44 16 superintendent to issue orders, grounds for management of the
 44 17 savings bank by the superintendent, judicial review of actions
 44 18 by the superintendent, management of a savings bank by the
 44 19 superintendent, cease and desist orders, involuntary
 44 20 dissolution of a savings bank, distribution of assets upon
 44 21 such insolvency, survival rights and remedies after
 44 22 dissolution; language relating to capital structure including
 44 23 minimum capital, capital notes and debentures, increase or
 44 24 decrease of capital, reverse stock splits, dividends,
 44 25 distribution of shares of a savings bank, and options for
 44 26 shares.
 44 27    The bill also amends provisions relating to the conversion
 44 28 of a savings bank into another type of financial institution.
 44 29    The bill directs the Code editor to review sections of Code
 44 30 chapter 534 and other sections citing Code chapter 534 or
 44 31 referring to savings and loan associations for the purpose of
 44 32 amending such sections and including such amendments in the
 44 33 substantive Code editor's bill or another appropriate bill to
 44 34 be introduced during the 1999 regular session.
 44 35    The bill, other than the directions to the Code editor,
 45  1 takes effect July 1, 1999.  
 45  2 LSB 3770SC 77
 45  3 mj/jw/5
     

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