S.F. _____ Section 1. Section 524.1303, subsection 1, Code 2021, is 1 amended to read as follows: 2 1. A state bank which has commenced business may propose to 3 voluntarily dissolve upon the affirmative vote of the holders 4 of at least a majority of the shares entitled to vote on the 5 voluntary dissolution, adopting a plan of dissolution involving 6 both a provision for acquisition of its assets and assumption 7 of its liabilities by another state bank, national bank, or 8 other financial institution insured by the federal deposit 9 insurance corporation and a provision for continuance of its 10 business if acquisition of its assets and assumption of its 11 liabilities is not effected, or any other plan of dissolution 12 providing for full payment of its liabilities. A state bank’s 13 adoption of a plan involving the acquisition of its assets 14 or the payment or assumption of its liabilities by a credit 15 union chartered under state or federal law shall not be deemed 16 sufficient to cause voluntary dissolution of a state bank under 17 this subsection. 18 Sec. 2. Section 524.1309, Code 2021, is amended to read as 19 follows: 20 524.1309 Becoming subject to chapter 489 or 490 . 21 In lieu of the dissolution procedure prescribed in sections 22 524.1303 through 524.1306 , a state bank may cease to carry 23 on the business of banking and, after compliance with this 24 section , continue as a corporation subject to chapter 490 ; or 25 if the state bank is organized as a limited liability company 26 under this chapter , continue as a limited liability company 27 subject to chapter 489 . 28 1. A state bank that has commenced business may propose 29 to voluntarily cease to carry on the business of banking and 30 become a corporation subject to chapter 490 , or a limited 31 liability company subject to chapter 489 , upon the affirmative 32 vote of the holders of at least a majority of the shares 33 entitled to vote on such proposal, adopting a plan involving 34 both a provision for acquisition of its assets and assumption 35 -1- LSB 2079XC (6) 89 jda/rn 1/ 8

S.F. _____ of its liabilities by another state bank, national bank, or 1 other financial institution insured by the federal deposit 2 insurance corporation, and a provision for continuance of 3 its business if acquisition of its assets and assumption of 4 its liabilities is not effected, or any other plan providing 5 for the cessation of banking business and the payment of its 6 liabilities. A state bank’s adoption of a plan involving the 7 acquisition of its assets or the payment or assumption of 8 its liabilities by a credit union chartered under state or 9 federal law shall not be deemed sufficient to cause a state 10 bank to cease to carry on the business of banking and become a 11 corporation subject to chapter 490. 12 2. The application to the superintendent for approval 13 of a plan described in subsection 1 shall be treated by 14 the superintendent in the same manner as an application for 15 approval of a plan of dissolution under section 524.1303, 16 subsection 2 , and shall be subject to section 524.1303, 17 subsection 3 . 18 3. Immediately upon adoption and approval of a plan to 19 voluntarily cease to carry on the business of banking and 20 become a corporation subject to chapter 490 , or a limited 21 liability company subject to chapter 489 , the state bank shall 22 deliver to the superintendent a plan to cease the business of 23 banking and become a corporation subject to chapter 490 , or a 24 limited liability company subject to chapter 489 , which shall 25 be signed by two of its duly authorized officers and shall 26 contain the name of the state bank, the post office address of 27 its principal place of business, the name and address of its 28 officers and directors, the number of shares entitled to vote 29 on the plan and the number of shares voted for or against the 30 plan, respectively, the nature of the business to be conducted 31 by the corporation under chapter 490 , or by the limited 32 liability company subject to chapter 489 , and the general 33 nature of the assets to be held by the corporation or company. 34 4. Upon approval of the plan by the superintendent, the 35 -2- LSB 2079XC (6) 89 jda/rn 2/ 8

S.F. _____ state bank shall immediately surrender to the superintendent 1 its authorization to do business as a bank and shall cease 2 to accept deposits and carry on the banking business except 3 insofar as may be necessary for it to complete the settlement 4 of its affairs as a state bank in accordance with subsection 5 . 5 5. The board of directors has full power to complete the 6 settlement of the affairs of the state bank. Within thirty 7 days after approval by the superintendent of the plan to cease 8 the business of banking and become a corporation subject 9 to chapter 490 , or a limited liability company subject to 10 chapter 489 , the state bank shall give notice of its intent 11 to persons identified in section 524.1305, subsection 3 , in 12 the manner provided for in that subsection. In completing 13 the settlement of its affairs as a state bank, the state bank 14 shall also follow the procedure prescribed in section 524.1305 , 15 subsections 4, 5, and 6 . 16 6. Upon completion of all the requirements of this section , 17 the state bank shall deliver to the superintendent articles of 18 intent to be subject to chapter 490 or 489 , together with the 19 applicable filing and recording fees, which shall set forth 20 that the state bank has complied with this section , that it has 21 ceased to carry on the business of banking, and the information 22 required by section 490.202 relative to the contents of 23 articles of incorporation under chapter 490 , or articles of 24 organization under chapter 489 . If the superintendent finds 25 that the state bank has complied with this section and that 26 the articles of intent to be subject to chapter 490 or 489 27 satisfy the requirements of this section , the superintendent 28 shall deliver them to the secretary of state for filing 29 and recording in the secretary of state’s office, and the 30 superintendent shall file and record them in the office of the 31 county recorder. 32 7. Upon the filing of the articles of intent to be subject 33 to chapter 490 or 489 , the state bank shall cease to be a state 34 bank subject to this chapter , and shall cease to have the 35 -3- LSB 2079XC (6) 89 jda/rn 3/ 8

S.F. _____ powers of a state bank subject to this chapter and shall become 1 a corporation subject to chapter 490 or a limited liability 2 company subject to chapter 489 . The secretary of state 3 shall issue a certificate as to the filing of the articles 4 of intent to be subject to chapter 490 or 489 and send the 5 certificate to the corporation or limited liability company or 6 its representative. The articles of intent to be subject to 7 chapter 490 or 489 shall be the articles of incorporation of 8 the corporation or a limited liability company . The provisions 9 of chapter 490 or 489 becoming applicable to a corporation or 10 limited liability company formerly doing business as a state 11 bank shall not affect any right accrued or established, or 12 liability or penalty incurred under this chapter prior to the 13 filing with the secretary of state of the articles of intent to 14 be subject to chapter 490 or 489 . 15 8. A shareholder of a state bank who objects to adoption 16 by the state bank of a plan to cease to carry on the business 17 of banking and to continue as a corporation subject to chapter 18 490 , or a limited liability company subject to chapter 489 , 19 is entitled to appraisal rights provided for in chapter 490, 20 subchapter XIII , or in chapter 489 , section 489.604 . 21 9. A state bank, at any time prior to the approval of the 22 articles of intent to become subject to chapter 490 or 489 , 23 may revoke the proceedings in the manner prescribed by section 24 524.1306 . 25 Sec. 3. Section 524.1401, subsection 1, Code 2021, is 26 amended to read as follows: 27 1. Upon compliance with the requirements of this chapter , 28 one or more state banks, one or more out-of-state banks, one or 29 more national banks, one or more federal savings associations, 30 one or more corporations, or any combination of these entities, 31 with the approval of the superintendent, may merge into a 32 state bank pursuant to a plan of merger . For purposes of 33 this section, “corporation” does not include a credit union, 34 industrial bank, or trust company. 35 -4- LSB 2079XC (6) 89 jda/rn 4/ 8

S.F. _____ Sec. 4. NEW SECTION . 524.1423 Authority to sell 1 participations or real property assets. 2 1. a. Subject to section 524.907, a state bank may sell 3 or transfer participations. If a state bank proposes to sell 4 or transfer greater than or equal to twenty-five percent 5 of the total value of its participations to a credit union 6 chartered under state or federal law, the state bank shall 7 provide a written notice and application for approval to the 8 superintendent not less than thirty days prior to completion of 9 the proposed sale or transfer. 10 b. A state bank may sell or transfer a portion of its real 11 property assets, subject to all of the following: 12 (1) If a state bank proposes to sell or transfer greater 13 than or equal to twenty-five percent of its real property 14 assets to a credit union chartered under state or federal law, 15 the state bank shall provide a written notice and application 16 for approval to the superintendent not less than thirty days 17 prior to completion of the proposed sale or transfer. 18 (2) If a state bank proposes to sell or transfer 19 real property containing a bank office or any other 20 physical location of the state bank, the state bank shall 21 provide written notice and application for approval to 22 the superintendent not less than thirty days prior to the 23 completion of the proposed sale or transfer. 24 2. The superintendent may approve a sale or transfer under 25 subsection 1 if the superintendent determines all of the 26 following: 27 a. The sale has been approved by a majority of the state 28 bank’s directors and shareholders. 29 b. The sale adequately protects the interests of the state 30 bank’s depositors, creditors, and shareholders. 31 c. The sale is consistent with safe and sound banking 32 practices. 33 d. The sale is in the public interest based on the financial 34 history and condition of the parties to the sale, including 35 -5- LSB 2079XC (6) 89 jda/rn 5/ 8

S.F. _____ the composition of the state bank’s balance sheet after the 1 sale, the potential effect of the sale on competition, and the 2 convenience and needs of the area served by the parties to the 3 sale. 4 Sec. 5. Section 533.406, Code 2021, is amended to read as 5 follows: 6 533.406 State credit union merger, conversion, or 7 dissolution. 8 1. Notwithstanding section 533.301, subsection 25 , a state 9 credit union shall comply with the state law requirements for 10 merger, conversion, or dissolution of a state credit union. 11 2. Except as provided in section 524.1423, a state credit 12 union shall not merge with, purchase the assets of, or assume 13 the liabilities of a bank, a federally chartered savings bank, 14 or a federally chartered savings association. For purposes of 15 this subsection, “bank” means the same as defined in section 16 524.103. 17 EXPLANATION 18 The inclusion of this explanation does not constitute agreement with 19 the explanation’s substance by the members of the general assembly. 20 This bill relates to financial institutions, including the 21 assets, liabilities, and merger of state banks and state credit 22 unions. 23 Current law provides that a state bank that has commenced 24 business may propose to voluntarily dissolve upon the adoption 25 of a plan of dissolution that includes provisions for the 26 acquisition of its assets and assumption of its liabilities 27 and for the continuance of its business if acquisition is not 28 effected. The bill provides that a state bank’s adoption of 29 a plan involving the acquisition of its assets or the payment 30 or assumption of its liabilities by a credit union shall not 31 be deemed sufficient to cause voluntary dissolution of a state 32 bank. 33 The bill modifies Code section 524.1309 to strike references 34 to a state bank continuing as a limited liability company after 35 -6- LSB 2079XC (6) 89 jda/rn 6/ 8

S.F. _____ ceasing to carry on the business of banking. 1 Current law provides that a state bank that has commenced 2 business may propose to cease carrying on the business of 3 banking and become a corporation subject to Code chapter 490 4 upon the adoption of a plan that includes provisions for the 5 acquisition of its assets and assumption of its liabilities 6 and for the continuance of its business if acquisition is not 7 effected. The bill provides that a state bank’s adoption of 8 a plan involving the acquisition of its assets or the payment 9 or assumption of its liabilities by a credit union shall not 10 be deemed sufficient to cause a state bank to cease to carry 11 on the business of banking and become a corporation subject to 12 Code chapter 490. 13 The bill authorizes one or more state banks, out-of-state 14 banks, national banks, federal savings associations, and 15 corporations, pursuant to a plan of merger and with the 16 approval of the superintendent, to merge into a state bank. 17 The bill creates new Code section 524.1423, which authorizes 18 a state bank, subject to the provisions of Code section 19 524.907, to sell or transfer participations. The bill requires 20 a state bank to provide a written notice and application for 21 approval to the superintendent of banking not less than 30 22 days prior to completion of the proposed sale or transfer if 23 the state bank proposes to sell or transfer greater than or 24 equal to 25 percent of the total value of its participations 25 to a credit union chartered under state or federal law. The 26 bill also requires a state bank to provide a written notice and 27 application for approval to the superintendent not less than 28 30 days prior to completion of a proposed sale or transfer of 29 its real property assets if the state bank proposes to sell 30 or transfer greater than or equal to 25 percent of its real 31 property assets to a credit union chartered under state or 32 federal law or real property containing a bank office or any 33 other physical location of the state bank. 34 The bill authorizes the superintendent to approve a sale 35 -7- LSB 2079XC (6) 89 jda/rn 7/ 8

S.F. _____ or transfer of a state bank’s participations or real property 1 assets if the superintendent makes certain determinations 2 enumerated in the bill. 3 The bill prohibits a state credit union from merging with, 4 purchasing the assets of, or assuming the liabilities of a 5 bank, a federally chartered savings bank, or a federally 6 chartered savings association, except as provided in new Code 7 section 524.1423. 8 -8- LSB 2079XC (6) 89 jda/rn 8/ 8