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Senate Study Bill 1236 - IntroducedA Bill ForAn Act 1relating to banks, making appropriations, providing
2penalties, and making penalties applicable.
3BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1 Section 1. Section 12.61, subsection 1, paragraph a, Code
22021, is amended to read as follows:
3a. “Financial institution” means a state bank as defined in
4section 524.103, subsection 41, a federally chartered state
5bank having its principal office within this state, a federally
6chartered credit union having its principal office within this
7state, a federally chartered savings and loan association
8having its principal office within the state, a credit union
9organized under chapter 533, or a trust company organized or
10incorporated under the laws of this state.
11 Sec. 2. Section 422.61, subsection 1, Code 2021, is amended
12to read as follows:
131. “Financial institution” means a state bank as defined in
14section 524.103, subsection 41, a state bank chartered under
15the laws of any other state, a national banking association,
16a trust company, a federally chartered savings and loan
17association, an out-of-state state chartered savings bank, a
18financial institution chartered by the federal home loan bank
19board, a non-Iowa chartered savings and loan association, or a
20production credit association.
21 Sec. 3. Section 453A.8, subsection 6, Code 2021, is amended
22to read as follows:
236. The director may authorize a bank as defined by section
24524.103, subsection 8, to sell stamps. A bank authorized to
25sell stamps shall comply with all of the requirements governing
26the sale of stamps by the department. Section 453A.12 shall
27apply to any bank authorized to sell stamps.
28 Sec. 4. Section 524.102, Code 2021, is amended by adding the
29following new subsection:
30 NEW SUBSECTION. 10. The opportunity for state banks to
31adopt, in a manner that is compatible with and subject to the
32purposes of this chapter, new and emerging technologies that
33enhance the efficiency and convenience of banking products and
34services.
35 Sec. 5. Section 524.103, Code 2021, is amended by adding the
-1-1following new subsections:
2 NEW SUBSECTION. 2A. “Affiliate” means the same as defined
3in section 524.1101.
4 NEW SUBSECTION. 22A. “Federal savings association” means a
5corporation organized under 12 U.S.C. §1464.
6 NEW SUBSECTION. 32A. “National bank” means a corporation
7organized under 12 U.S.C. §21 whose deposits are insured by
8the federal deposit insurance corporation or whose powers are
9limited exclusively to the exercise of trust or fiduciary
10powers.
11 NEW SUBSECTION. 34A. “Out-of-state bank” means a
12corporation, other than a credit union, industrial bank, or
13trust company, that is authorized by the laws of another state
14to solicit, receive, or accept money or its equivalent for
15deposit or to otherwise engage in the business of banking.
16 NEW SUBSECTION. 36A. “Safe deposit box” means a safe, lock
17box, or other secure storage receptacle located on the premises
18of a bank.
19 Sec. 6. Section 524.103, subsections 6, 8, 10, 12, 13, 16,
2017, 20, 22, 25, 27, 29, 33, 34, 38, 39, 41, 44, and 48, Code
212021, are amended to read as follows:
226. “Articles of incorporation” means the original, amended,
23 or restated articles of incorporation and all amendments
24thereto and includes articles of merger. “Articles of
25incorporation” also means the original or restated articles of
26organization and all amendments including articles of merger if
27a state bank is organized as a limited liability company under
28this chapter.
298. “Bank” means a corporation or limited liability company
30 organized under this chapter or 12 U.S.C. §21, a national bank,
31a federal savings association, or an out-of-state bank.
3210. “Board of directors” means the board of directors of a
33state bank as provided in section 524.601. For a state bank
34organized as a limited liability company under this chapter,
35“board of directors” means a board of directors or board of
-2-1managers as designated by the limited liability company in its
2articles of organization or operating agreement.
312. “Business of banking” means engaging in the regular
4 business of soliciting, receiving, or accepting money or its
5equivalent for deposit, and any other business generally done
6by banks.
713. “Calculation date” means the most recent of the
8following:
9a. The date the state bank’s statement of condition is
10required to be filed pursuant to section 524.220, subsection 2.
11b. The date an event occurs that reduces or increases the
12state bank’s aggregate capital by ten percent or more.
13c. As the superintendent may direct.
1416. “Chief executive officer” means the person designated by
15the board of directors to be responsible for the implementation
16of and adherence to board policies and resolutions by all
17officers and employees of the state bank.
1817. a. “Contractual commitment to advance funds” means a
19state bank’s obligation to do either of the following:
20(1) Advance funds under a standby letter of credit or other
21similar arrangement.
22(2) Make payment, directly or indirectly, to a third person
23contingent upon default by a customer of the state bank in
24performing an obligation and to make such payment in keeping
25with the agreed upon terms of the customer’s contract with
26a third person, or to make payments upon some other stated
27condition.
28b. The term does not include commercial letters of credit
29and similar instruments where the issuing state bank expects
30the beneficiary to draw on the issuer, that do not guarantee
31payment, and that do not provide for payment in the event of a
32default by a third person.
3320. “Director” means a member of the board of directors
34and includes a manager of a state bank organized as a limited
35liability company under this chapter.
-3- 122. “Executive officer” means a person who participates or
2has authority to participate, other than in the capacity of a
3director or manager, in major policymaking functions of a state
4bank, whether or not the officer has an official title, whether
5or not such a title designates the officer as an assistant, or
6whether or not the officer is serving without salary or other
7compensation. The chief executive officer, chairperson of the
8board, the president, every vice president, and the cashier
9of a state bank are deemed to be executive officers, unless
10such an officer is excluded, by resolution of the board of
11directors of a state bank or by the bylaws of the state bank,
12from participation, other than in the capacity of a director,
13in major policymaking functions of the state bank, and the
14officer does not actually participate in the major policymaking
15functions. All officers who serve on a board of directors are
16deemed to be executive officers, except as provided for in
17section 524.701, subsection 3.
1825. “Insured bank” means a state bank the deposits of which
19are insured in accordance with the provisions of the Federal
20Deposit Insurance Act.
2127. “Member” means a person with a membership interest
22in a state bank organized as a limited liability company or
23 incorporated as a mutual corporation under this chapter.
2429. “Membership interest” means a member’s share of the
25profits and losses, the right to receive distributions of
26assets, and any right to vote or participate in management of a
27state bank organized as a limited liability company under this
28chapter or of a state bank incorporated as a mutual corporation
29under this chapter.
3033. “Officer” means chief executive officer, executive
31officer, or any other administrative official of a state bank
32elected by the state bank’s board of directors to carry out any
33of the state bank’s operating rules and policies.
3434. “Operations subsidiary” means a wholly owned corporation
35incorporated and controlled by a state bank that performs
-4-1functions which the state bank is authorized to perform.
238. “Shareholder” means one who is a holder of record of
3shares in a state bank. If a state bank is organized as a
4limited liability company under this chapter, “shareholder”
5 means a member of the limited liability company. If a state
6bank is incorporated as a mutual corporation under this
7chapter, “shareholder” means a member of the mutual corporation.
839. “Shares” means the units into which the proprietary
9interests in a state bank incorporated as a stock corporation
10are divided, including any membership interests of a state bank
11organized as a limited liability company under this chapter.
1241. “State bank” means any bank incorporated pursuant to
13the provisions of this chapter after January 1, 1970, and any
14“state bank” incorporated pursuant to the laws of this state and
15doing business as such on January 1, 1970, or a bank organized
16as a limited liability company or a mutual corporation under
17this chapter.
1844. “Supervised financial organization” as defined and used
19in the Iowa consumer credit code, chapter 537, includes a
20person state bank organized pursuant to this chapter.
2148. “Unincorporated area” means a village within which an
22area where a state bank or national bank has its principal
23place of business that is not within a municipal corporation.
24 Sec. 7. Section 524.103, subsection 26, Code 2021, is
25amended by striking the subsection.
26 Sec. 8. Section 524.105, subsection 2, Code 2021, is amended
27to read as follows:
282. All state banks are subject to the provisions and
29requirements of this chapter in every particular, and all
30national banks out-of-state banks, and federal savings
31associations, now or hereafter doing business in this state,
32are subject to the provisions of this chapter, to the extent
33applicable, from July 1, 1995 2021.
34 Sec. 9. Section 524.107, subsections 1 and 2, Code 2021, are
35amended to read as follows:
-5- 11. A person, other than a state bank which is subject to
2the provisions of this chapter, an out-of-state bank, and
3a national bank or federal savings association authorized
4by the laws of the United States to engage in the business
5of receiving money for deposit, and except as provided in
6subsection 2, shall not engage in this state in the business
7of receiving money for deposit, transact the business of
8banking, or establish in this state a place of business for
9such purpose.
102. A person doing business in this state shall not use
11the words “bank” or “trust” or use any derivative, plural,
12or compound of the words “bank”, “banking”, or “bankers”, or
13“trust” in any manner which would tend to create the impression
14that the person is authorized to engage in the business of
15banking or to act in a fiduciary capacity, except a state
16bank authorized to do so by this chapter or a an out-of-state
17 bank authorized to do so by the laws of another state, a
18national bank to the extent permitted by the laws of the
19United States, a bank holding company as defined in section
20524.1801, a savings and loan holding company as defined in 12
21U.S.C. §1467a, or a federal savings association to the extent
22permitted by the laws of the United States, or, insofar as the
23word “trust” is concerned, an individual permissibly serving
24as a fiduciary in this state, pursuant to section 633.63,
25or, insofar as the words “trust” and “bank” are concerned,
26a nonresident corporate fiduciary permissibly serving as a
27fiduciary in this state pursuant to section 633.64.
28 Sec. 10. Section 524.109, subsection 1, Code 2021, is
29amended to read as follows:
301. A state bank may be organized under this chapter as a
31bankers’ bank. The bankers’ bank is subject to all rights,
32privileges, duties, restrictions, penalties, liabilities,
33conditions and limitations applicable to a state bank
34generally, except as limited in the definition of bankers’
35bank contained in section 524.103, subsection 9. However, a
-6-1bankers’ bank shall have the same powers as those granted by
2federal law and regulation to a national bank organized as a
3bankers’ bank under 12 U.S.C. §27.
4 Sec. 11. Section 524.203, Code 2021, is amended to read as
5follows:
6524.203 Superintendent — vacancy.
7If the office of the superintendent of banking is vacant
8or the superintendent is unable to serve, the chief of the
9bank bureau of the banking division shall be the acting
10superintendent until the governor appoints a new superintendent
11or acting superintendent. If the chief of the bank bureau is
12unable to serve, the chief examiner of the finance bank bureau
13of the banking division shall be the acting superintendent
14until the governor appoints a new superintendent or acting
15superintendent. If both the chief of the bank bureau and
16the chief examiner of the finance bank bureau are unable to
17serve, the chief of the professional licensing and regulation
18 finance bureau of the banking division shall be the acting
19superintendent until the governor appoints a new superintendent
20or acting superintendent.
21 Sec. 12. Section 524.207, subsections 2 and 6, Code 2021,
22are amended to read as follows:
232. All fees and assessments generated as the result of
24a federally chartered national bank or federal savings and
25loan association converting to a state-chartered state bank
26on or after December 31, 2015, and thereafter, are payable
27to the superintendent. The superintendent shall pay all the
28fees and assessments received by the superintendent pursuant
29to this subsection to the treasurer of state within the time
30required by section 12.10 and the fees and assessments shall
31be deposited into the department of commerce revolving fund
32created in section 546.12. An amount equal to such fees
33and assessments deposited into the department of commerce
34revolving fund is appropriated from the department of commerce
35revolving fund to the banking division of the department of
-7-1commerce for the fiscal year in which a federally chartered
2 national bank or federal savings and loan association converted
3to a state-chartered state bank and an amount equal to such
4annualized fees and assessments deposited into the department
5of commerce revolving fund in succeeding years is appropriated
6from the department of commerce revolving fund to the banking
7division of the department of commerce for succeeding fiscal
8years for purposes related to the discharge of the duties and
9responsibilities imposed upon the banking division of the
10department of commerce, the superintendent, and the state
11banking council by the laws of this state. This appropriation
12shall be in addition to the appropriation of moneys otherwise
13described in this section. If a state-chartered state
14 bank converts to a federally chartered national bank or
15federal savings and loan association, any appropriation made
16pursuant to this subsection for the following fiscal year
17shall be reduced by the amount of the assessment paid by the
18state-chartered state bank during the fiscal year in which the
19state-chartered state bank converted to a federally chartered
20 national bank or federal savings and loan association.
216. All moneys received by the superintendent pursuant
22to a multi-state settlement with a provider of financial
23services such as a mortgage lender, a mortgage servicer, or
24any other person regulated by the banking division of the
25department of commerce shall be deposited into the department
26of commerce revolving fund created in section 546.12 and
27an amount equal to the amount deposited into the fund is
28appropriated to the banking division of the department of
29commerce for the fiscal year in which such moneys are received
30and in succeeding fiscal years for the purpose of promoting
31financial-related education and supporting those duties of
32the banking division related to financial regulation that are
33limited to nonrecurring expenses such as equipment purchases,
34training, technology, and retirement payouts related to the
35oversight of mortgage lending, state-chartered state banks, and
-8-1other financial services regulated by the banking division.
2This appropriation shall be in addition to the appropriation of
3moneys otherwise described in this section. The superintendent
4shall submit a report to the department of management and to
5the legislative services agency detailing the expenditure
6of moneys appropriated to the banking division pursuant to
7this subsection during each fiscal year. The initial report
8shall be submitted on or before September 15, 2016, and each
9September 15 thereafter. Moneys appropriated pursuant to
10this subsection are not subject to section 8.33 and shall not
11be transferred, used, obligated, appropriated, or otherwise
12encumbered except as provided in this subsection.
13 Sec. 13. Section 524.208, Code 2021, is amended to read as
14follows:
15524.208 Examiners and other employees.
16The superintendent may appoint examiners and other
17employees, including for the banking division’s internal
18information technology group, as the superintendent deems
19necessary to the proper discharge of the duties imposed upon
20the superintendent by the laws of this state. Pay plans shall
21be established for employees, other than clerical employees or
22employees of the professional licensing and regulation bureau
23of the banking division, who examine the accounts and affairs
24of state banks and who examine the accounts and affairs of
25other persons, subject to supervision and regulation by the
26superintendent, which are substantially equivalent to those
27paid by the federal deposit insurance corporation and other
28federal supervisory agencies in this area of the United States.
29 Sec. 14. Section 524.211, subsection 1, Code 2021, is
30amended to read as follows:
311. The superintendent, general counsel, examiners, and
32other employees assigned to the bank bureau of the banking
33division are prohibited from obtaining a loan of money or
34property from a state-chartered state bank, or any person
35or entity affiliated with a state-chartered state bank,
-9-1unless they do not personally participate in the examination,
2oversight, or official review concerning the regulation of the
3state bank.
4 Sec. 15. Section 524.211, Code 2021, is amended by adding
5the following new subsection:
6 NEW SUBSECTION. 8. The superintendent shall not
7participate in the examination, oversight, or official review
8concerning the regulation of any state bank or any other
9enterprise, person, or affiliate subject to the regulatory
10purview of the banking division of which the superintendent
11is a shareholder, member, partner, owner, director, officer,
12or employee. The superintendent shall recuse themselves from
13participation in any such examination, oversight, or official
14review and the state banking council shall designate a member
15who satisfies the qualifications identified in section 524.201,
16subsection 1, and who is not a shareholder, member, partner,
17owner, director, officer, or employee of the regulated entity
18to act in place of the superintendent.
19 Sec. 16. Section 524.212, subsection 1, Code 2021, is
20amended to read as follows:
211. The superintendent, members of the state banking
22council, general counsel, examiners, or other employees of the
23banking division shall not disclose, in any manner, to any
24person other than the person examined and those regulatory
25agencies referred to in section 524.217, subsection 2, any
26information relating specifically to the supervision and
27regulation of any state bank, persons subject to the provisions
28of chapter 533A, 533C, 533D, 535B, 535D, 536, or 536A, any
29affiliate of any state bank, or an affiliate of a person
30subject to the provisions of chapter 533A, 533C, 536, or
31536A, except when ordered to do so by a court of competent
32jurisdiction and then only in those instances referred to in
33section 524.215, subsection 2, paragraphs “a”, “b”, “c”, “e”,
34and “f”.
35 Sec. 17. Section 524.217, subsection 6, Code 2021, is
-10-1amended to read as follows:
26. The superintendent may enter into contractual agreements
3with other state regulators of financial institutions to share
4examiners or to assist in each state’s respective examinations
5or other supervisory activities. A contractual agreement
6pursuant to this section may provide for reimbursement to the
7state providing assistance. The division of banking shall be
8reimbursed for any costs incurred when providing services to
9other states pursuant to this subsection. Any division of
10banking personnel assisting another state with its examination
11 examinations or other supervisory activities shall be covered
12by the provisions of the other state’s tort claims act, to the
13extent permitted by the laws of the other state. If the law
14of the other state does not extend coverage to the division
15of banking personnel working on the other state’s examination
16 examinations or other supervisory activities, the provisions of
17chapter 669 shall apply.
18 Sec. 18. Section 524.218, Code 2021, is amended by striking
19the section and inserting in lieu thereof the following:
20524.218 Regulation and examination of service providers.
211. Whenever a state bank, or any subsidiary or affiliate
22of a state bank that is subject to examination by the
23superintendent, causes to be performed for itself, by contract
24or otherwise, a covered service, such performance shall be
25subject to regulation and examination by the superintendent to
26the same extent as if the covered service was being performed
27by the state bank itself.
282. For purposes of this section, “covered service” means and
29includes all of the following:
30a. Data processing services.
31b. Activities that support financial services, including
32but not limited to lending, funds transfer, payment processing,
33fiduciary activities, trading activities, and deposit taking.
34c. Internet-related services, including but not limited to
35web services and electronic bill payments, mobile applications,
-11-1system and software development and maintenance, and security
2monitoring.
3d. Activities related to the business of banking.
43. The superintendent may, in the superintendent’s
5discretion, accept examinations authorized or required to
6be conducted by this section, which are made by other state
7or federal financial regulatory agencies listed in section
8534.217, subsection 2, in lieu of any examination authorized or
9required under the laws of this state.
10 Sec. 19. Section 524.220, subsection 1, Code 2021, is
11amended to read as follows:
121. A state bank shall, upon request, render a full, clear,
13and accurate statement of its condition to the superintendent,
14in a format prescribed by the superintendent, verified by the
15oath of two of its officers, and attested by at least two of
16the directors. The superintendent may, in the superintendent’s
17discretion, use any form of statement of condition that is used
18by the federal deposit insurance corporation or the federal
19reserve system, and the superintendent may rely on a statement
20of condition a state bank submits to the federal deposit
21insurance corporation or the federal reserve system.
22 Sec. 20. Section 524.221, subsection 3, Code 2021, is
23amended to read as follows:
243. The provisions of this section, insofar as applicable,
25shall apply to the records of a national bank, or a federally
26chartered savings bank or a federally chartered federal savings
27and loan association, or an out-of-state bank.
28 Sec. 21. Section 524.223, Code 2021, is amended to read as
29follows:
30524.223 Power of superintendent to issue orders.
311. Whenever it shall appear to the superintendent that a
32state bank, or any director, officer, employee, or substantial
33shareholder of the state bank, is engaging or has engaged,
34or the superintendent has reasonable cause to believe that
35the state bank, director, officer, employee, or substantial
-12-1shareholder is about to engage, in an unsafe or unsound
2practice in conducting the business of such state bank, or is
3violating or has violated, or the superintendent has reasonable
4cause to believe that the state bank, director, officer,
5employee, or substantial shareholder is about to violate, any
6provision of this chapter or of any regulation adopted pursuant
7to this chapter, or any condition imposed in writing by the
8superintendent in connection with the approval of any matter
9required by this chapter, or any written agreement entered into
10with the superintendent, or any provision of chapter 12C or
11any rules adopted pursuant to chapter 12C, the superintendent
12may issue and serve upon the state bank, director, officer,
13employee, or substantial shareholder a notice containing a
14statement of the facts constituting the alleged violation or
15violations, or the unsafe or unsound practice or practices,
16and fixing a time and place at which a hearing will be held to
17determine whether an order to cease and desist should be issued
18to the state bank, director, officer, employee, or substantial
19shareholder.
202. If the state bank, director, officer, employee, or
21substantial shareholder fails to appear at the hearing it shall
22be deemed to have consented to the issuance of a cease and
23desist order. In the event of such consent, or if upon the
24record made at such hearing, the superintendent shall find
25that any violation or unsafe or unsound practice specified in
26the notice has been established, the superintendent may issue
27and serve upon the state bank, director, officer, employee,
28or substantial shareholder an order to cease and desist from
29any such violation or practice. Such order may require the
30state bank and its directors, officers, and employees, and
31shareholders to cease and desist from any such violation or
32practice and, further, to take affirmative action to correct
33the conditions resulting from any such violation or practice.
34In addition, if the violation or practice involves a failure
35to comply with chapter 12C or any rules adopted pursuant to
-13-1chapter 12C, the superintendent may recommend to the committee
2established under section 12C.6 that the bank be removed from
3the list of financial institutions eligible to accept public
4funds under section 12C.6A and may require that during the
5current calendar quarter and up to the next succeeding eight
6calendar quarters that the bank do any one or more of the
7following:
8a. Not accept public funds deposits.
9b. Return to the depositors some or all uninsured public
10funds held in demand deposits and, when deposit instruments
11or agreements mature, return to the depositors some or
12all deposits representing proceeds of such instruments or
13agreements.
14c. Pledge collateral to the treasurer of state having a
15value at all times up to one hundred ten percent of the public
16funds held by the bank.
17d. Comply with such other requirements as the superintendent
18may impose.
193. Any order issued pursuant to this section shall become
20effective upon service of the order on the state bank,
21director, officer, employee, or substantial shareholder
22 and shall remain effective except to such extent that it is
23stayed, modified, terminated, or set aside by action of the
24superintendent or of the district court of the Polk county in
25which the state bank has its principal place of business.
264. The superintendent may apply to the district court of
27the Polk county in which the state bank has its principal place
28of business for the enforcement of any order pursuant to this
29section and such court shall have jurisdiction and power to
30order and require compliance.
315. For purposes of this section, “substantial shareholder”
32 means a shareholder exercising a controlling influence over the
33management or policies of a state bank as determined by the
34superintendent.
35 Sec. 22. Section 524.224, Code 2021, is amended to read as
-14-1follows:
2524.224 Grounds for management of state bank by
3superintendent order to cease business — appointment of
4receiver.
51. The superintendent may take over the management of the
6property and business of, without prior notice or hearings,
7order a state bank to cease to carry on its business whenever
8it appears to the superintendent determines that:
9a. The state bank has violated its articles of incorporation
10or any law of this state.
11b. The capital of the state bank is impaired.
12c. The state bank is conducting its business in an unsafe
13or unsound manner.
14d. The state bank is insolvent or is otherwise in such
15condition that it is unsound, unsafe or inexpedient for it to
16transact business.
17e. The state bank has suspended or refused payment of its
18deposits or other liabilities contrary to the terms thereof,
19or the superintendent determines the state bank is unlikely to
20be able to pay its deposits or other liabilities in the near
21future.
22f. The state bank refuses to make its records available
23to the superintendent for examination or otherwise refuses to
24make available, through an officer or employee having knowledge
25thereof, information required by the superintendent for the
26proper discharge of the duties of the superintendent’s office.
27g. The state bank neglects or refuses to observe any order
28of the superintendent made pursuant to the provisions of this
29chapter, unless the enforcement of such order is stayed in a
30proceeding brought by the state bank.
31h. The state bank has not transacted any business or
32performed any of the duties, contemplated by its authorization
33to do business, for a period of one year thirty days.
34i. The state bank has failed to renew its corporate
35existence in the manner provided for in section 524.314 within
-15-1one hundred eighty days prior to the expiration thereof.
22. The superintendent shall thereafter manage the
3property and business of the state bank until such time
4as the superintendent may relinquish to the state bank the
5management thereof, upon such conditions as the superintendent
6may prescribe, or until its affairs be finally dissolved as
7provided in this chapter Upon ordering a state bank to cease
8to carry on its business, the superintendent shall immediately
9appoint the federal deposit insurance corporation as receiver
10pursuant to section 524.1310.
11 Sec. 23. Section 524.225, Code 2021, is amended to read as
12follows:
13524.225 Procedures — judicial review.
14Judicial review of the actions of the superintendent may be
15sought in accordance with chapter 17A. However, contested case
16provisions of chapter 17A, the Iowa administrative procedure
17Act, do not apply to an action by the superintendent to take
18over the management of or to manage order a state bank to
19cease to carry on its business and to appoint a receiver, as
20authorized by sections section 524.224 and 524.226.
21 Sec. 24. Section 524.228, Code 2021, is amended to read as
22follows:
23524.228 Interim Emergency cease and desist order — final
24order — suspension.
251. If it appears to the superintendent that a state bank,
26or any director, officer, employee, or substantial shareholder
27of the state bank is engaging in or is about to engage in an
28unsafe or unsound practice or dishonest act in conducting the
29business of the state bank that is likely to cause insolvency
30or substantial dissipation of assets or earnings of the state
31bank, or is likely to seriously weaken the condition of the
32state bank or otherwise seriously prejudice the interests of
33its depositors prior to the completion of the proceedings
34conducted pursuant to section 524.223, 524.606, subsection
352, or 524.707, subsection 2, the superintendent may issue an
-16-1interim emergency order requiring the state bank, director,
2officer, employee, or substantial shareholder to cease and
3desist from any such practice or act, and to take affirmative
4action, including suspension of the director, officer, or
5employee to prevent such insolvency, dissipation, condition, or
6prejudice pending completion of the proceedings. The interim
7 emergency order becomes effective upon service upon the state
8bank, or upon the director, officer, employee, or substantial
9shareholder of the state bank and, unless set aside, limited,
10or suspended by a court as provided in this chapter, remains
11effective and enforceable pending the completion of the
12administrative proceedings pursuant to the interim emergency
13 order and until such time as the superintendent dismisses the
14charges specified in the interim emergency order, or, if a
15final cease and desist order is issued against the state bank
16or the director, officer, employee, or substantial shareholder
17until the effective date of the final order.
182. Within ten days after the state bank concerned or any
19director, officer, employee, or substantial shareholder is
20served with an interim emergency order, the state bank or such
21director, officer, employee, or substantial shareholder may
22apply to the district court in the of Polk county in which the
23bank has its principal place of business, for an injunction
24setting aside, limiting, or suspending the enforcement,
25operation, or effectiveness of such interim emergency order
26pending the completion of the administrative proceedings. If
27serious prejudice to the interests of the superintendent, the
28state bank, the officer, director, employee, or substantial
29shareholder would result from such hearing, the court may order
30the judicial proceeding to be conducted in camera.
313. The interim emergency order shall contain a concise
32statement of the facts constituting the alleged unsafe or
33unsound practice or alleged dishonest act, and shall fix a time
34and place at which a hearing will be held to determine whether
35a final order to cease and desist should issue against the
-17-1state bank or any director, officer, employee, or substantial
2shareholder. The hearing shall be fixed for a date not later
3than thirty days after service of the interim emergency order
4unless a later date is set at the request of the party so
5served. If the state bank, or the director, officer, employee,
6or substantial shareholder fails to appear at the hearing, the
7state bank, or the director, officer, employee, or substantial
8shareholder is deemed to have consented to the issuance of a
9cease and desist order. In the event of such consent, or if
10upon the record made at the hearing the superintendent finds
11that any unsafe or unsound practice or dishonest act specified
12in the interim emergency order has been established, the
13superintendent may issue and serve upon the state bank, or the
14director, officer, employee, or substantial shareholder a final
15order to cease and desist from any such practice or act. The
16order may require the state bank, or the director, officer,
17employee, or substantial shareholder to cease and desist from
18any such practice or act and, further, to take affirmative
19action, including suspension of the director, officer, or
20employee.
214. A hearing provided for in this section shall be presided
22over by an administrative law judge appointed in accordance
23with section 17A.11. The hearing shall be private, unless
24the superintendent determines after full consideration of
25the views of the party afforded the hearing, that a public
26hearing is necessary to protect the public interest. After
27the hearing, and within thirty days after the case has been
28submitted for decision, the superintendent shall review the
29proposed order of the administrative law judge and render a
30final decision, including findings of fact upon which the
31decision is predicated, and issue and serve upon each party to
32the proceeding an order consistent with this section.
335. Any final order issued by the superintendent pursuant to
34subsection 3 becomes effective upon service of the final order
35on the state bank, director, officer, employee, or substantial
-18-1shareholder and shall remain effective except to the extent
2that it is stayed, modified, terminated, or set aside by action
3of the superintendent or of the district court of the Polk
4 county in which the state bank has its principal place of
5business in accordance with the terms of chapter 17A.
66. In the case of violation or threatened violation of, or
7failure to obey, an interim emergency order issued pursuant to
8subsection 1 or a final order issued pursuant to subsection
93, the superintendent may apply to the district court of the
10 Polk county in which the state bank has its principal place of
11business for the enforcement of the order and such court shall
12have jurisdiction and power to order and require compliance
13with the interim emergency order or final order.
147. For purposes of this section, “substantial shareholder”
15means a shareholder exercising a controlling influence over the
16management or policies of a state bank as determined by the
17superintendent.
18 Sec. 25. NEW SECTION. 524.230 Superintendent authority —
19supervision of state bank.
201. The superintendent may, by order and without prior
21notice, appoint a supervisor for a state bank if the
22superintendent determines that the state bank is in a
23troubled condition and an order of supervision is necessary to
24protect the best interests of the state bank, its depositors,
25creditors, shareholders, or the public.
262. A state bank that is under an order of supervision
27shall not, without the prior approval of the superintendent
28or the supervisor, unless otherwise permitted by the order of
29supervision, do any of the following:
30a. Dispose of, sell, transfer, convey, or encumber the state
31bank’s assets.
32b. Lend or invest the state bank’s money.
33c. Incur a debt, liability, or obligation.
34d. Pay a cash dividend.
35e. Remove an executive officer or director, effect any
-19-1change in the positions of executive officer or director, or
2change the number of executive officers or directors.
33. The superintendent may serve as supervisor of a state
4bank or may appoint as supervisor any person, including an
5employee of the banking division, who the superintendent
6determines is qualified for the position.
74. The superintendent, during the period of supervision
8of the state bank, may require reimbursement by the state
9bank to the extent of the reasonable expenses attributable to
10the service of a supervisor, including costs incurred by the
11division of banking and expenses of the supervisor and any
12professional employees appointed to assist or represent the
13supervisor.
145. A supervisor appointed pursuant to this section shall
15serve until the date specified in the order of supervision or
16the date when the superintendent determines that the conditions
17necessary to terminate the order have been satisfied, whichever
18is earlier. The superintendent may terminate an order of
19supervision at any time.
206. When a state bank has adequately addressed the
21conditions that necessitated the order of supervision, the
22superintendent shall return the state bank to its former or
23new management under conditions reasonable and necessary to
24prevent a recurrence of the conditions that caused the order
25of supervision.
267. The superintendent, at any time during the period of
27supervision of a state bank, may order the state bank to cease
28to carry on its business in accordance with the provisions of
29section 524.224. Notwithstanding any other provision of law
30to the contrary, the banking division, the superintendent, the
31examiners, and all other employees of the banking division
32shall not be liable to any person if a state bank subject to a
33supervision order pursuant to this section ceases to carry on
34the business of banking pursuant to section 524.224 or closes
35or fails pursuant to any applicable provision of federal law.
-20-1 Sec. 26. Section 524.301, Code 2021, is amended to read as
2follows:
3524.301 Incorporators — organizers.
4A state bank may be incorporated or organized as a limited
5liability company under this chapter by one or more individuals
6eighteen years of age or older, a majority of whom shall be
7residents of this state and citizens of the United States.
8 Sec. 27. Section 524.302, subsection 1, unnumbered
9paragraph 1, Code 2021, is amended to read as follows:
10The articles of incorporation of a state bank, in the form
11prescribed by the superintendent, shall must set forth all of
12 the following:
13 Sec. 28. Section 524.302, subsection 1, paragraph b, Code
142021, is amended to read as follows:
15b. The location physical address of its proposed principal
16place of business including the name of the municipal
17corporation, if any, and county.
18 Sec. 29. Section 524.303, subsection 2, Code 2021, is
19amended to read as follows:
202. Applicable fees, payable to the secretary of state as
21specified in section 489.117 or section 490.122, for the filing
22and recording of the articles of incorporation.
23 Sec. 30. Section 524.304, subsection 1, unnumbered
24paragraph 1, Code 2021, is amended to read as follows:
25The incorporators or organizers of a state bank shall,
26within thirty days of the acceptance of the application for
27processing, publish notice of the proposed incorporation or
28organization once each week for two successive weeks in a
29newspaper of general circulation published in the municipal
30corporation which is proposed as the principal place of
31business of the state bank, or if there is none, a newspaper
32of general circulation published in the county, or in a county
33adjoining the county, in which the proposed state bank is to
34have its principal place of business. The notice shall set
35forth all of the following:
-21-1 Sec. 31. Section 524.305, subsection 1, paragraph b, Code
22021, is amended to read as follows:
3b. The convenience and needs of the public will be served
4by the proposed state bank, including by accepting deposits
5from, lending money in, and processing payments in the area the
6proposed state bank will primarily serve.
7 Sec. 32. Section 524.305, subsections 3 and 4, Code 2021,
8are amended to read as follows:
93. Within thirty days after the date of the second
10 publication of the notice required under section 524.304, any
11interested person may submit written comments and information
12to the superintendent concerning the application. Comments
13challenging the legality of an application must be submitted
14separately in writing. The superintendent may extend
15the thirty-day comment period, if, in the judgment of the
16superintendent, extenuating circumstances which justify the
17extension exist.
184. Within thirty days after the date of the second
19 publication of the notice required by section 524.304,
20any interested person may submit a written request of the
21superintendent for a hearing on the application. The request
22shall state the nature of the issues or facts to be presented
23and the reasons why written submissions would be insufficient
24to make an adequate presentation to the superintendent. If the
25reasons are related to factual disputes, the disputes shall be
26described. A written request for a hearing shall be evaluated
27by the superintendent, who may grant or deny the request in
28whole or in part. A hearing request shall generally be granted
29only if it is determined that written submissions would be
30inadequate or that a hearing would otherwise be beneficial
31to the decision-making process. A hearing may be limited to
32issues considered material by the superintendent.
33 Sec. 33. Section 524.306, Code 2021, is amended to read as
34follows:
35524.306 Incorporation or organization of state bank.
-22- 11. Unless a delayed effective date or time is specified, the
2corporate or organizational existence of a state bank begins
3when the articles of incorporation, with the superintendent’s
4approval indicated on the articles of incorporation, are filed
5with the secretary of state. The secretary of state shall
6record the articles of incorporation and forward a copy of them
7to the county recorder of the county in which the state bank is
8to have its principal place of business.
92. The secretary of state’s acknowledgment of filing of
10the articles of incorporation is conclusive proof that the
11incorporators or organizers satisfied all conditions precedent
12to incorporation or organization, except in a proceeding
13instituted by the superintendent to cancel or revoke the
14incorporation or involuntarily dissolve the corporation or
15organization.
16 Sec. 34. Section 524.307, Code 2021, is amended to read as
17follows:
18524.307 Initial organization of state bank.
19Upon incorporation, or organization as a limited liability
20company, of the state bank, the initial board of directors
21shall hold an organizational meeting within this state, at
22the call of a majority of the directors, to complete the
23organization of the state bank by electing officers, adopting
24bylaws, if any are to be adopted, and conducting any other
25business properly brought before the board at the meeting.
26 Sec. 35. Section 524.310, subsection 2, Code 2021, is
27amended to read as follows:
282. The provisions of this section shall not require any
29state bank existing and operating on January 1, 1970, to add
30to, modify or otherwise change its corporate or organizational
31name, either on January 1, 1970, or upon renewal of its
32corporate existence pursuant to section 524.314 at any time
33thereafter.
34 Sec. 36. Section 524.312, Code 2021, is amended to read as
35follows:
-23- 1524.312 Location of state bank — exceptions.
21. A state bank originally incorporated or organized
3pursuant to this chapter shall have its principal place of
4business within the city limits of a municipal corporation.
5The existence of a state bank shall not, however, be affected
6by the subsequent discontinuance of the municipal corporation.
7A state bank existing and operating on January 1, 1970, which
8does not have its principal place of business within the city
9limits of a municipal corporation, may renew its corporate
10or organizational existence pursuant to section 524.314
11 without regard to this section and may also operate as a bank
12or convert to and operate as a bank office when acquired
13by or merged into another state bank and approved by the
14superintendent state of Iowa.
152. A state bank may, with the prior written approval of the
16superintendent, change the location of its principal place of
17business to a new location within the state.
183. If a change in the location of the principal place
19of business of a state bank is proposed, application for
20approval of the superintendent shall be made as required by the
21superintendent pursuant to this section. A change in location
22of the principal place of business of a state bank, including
23a change from one municipal corporation to another municipal
24corporation within an urban complex, requires an amendment to
25the articles of incorporation pursuant to sections 524.1502,
26524.1504, and 524.1506. A state bank seeking approval of a
27change of location pursuant to this subsection shall publish
28a notice of the proposed change of location in a newspaper
29of general circulation in the municipal corporation or
30unincorporated area in which the state bank has its principal
31place of business, or if there is none, in a newspaper of
32general circulation in the county, or in a county adjoining
33the county, in which the state bank has its principal place of
34business, and in the municipal corporation in which it seeks to
35establish its principal place of business, or if there is none,
-24-1in a newspaper of general circulation in the county, or in a
2county adjoining the county, in which the municipal corporation
3is located. The notice shall be published within thirty days
4after the application to the superintendent for approval
5of the change in location is accepted for processing. The
6notice shall set forth the name of the state bank, the present
7location of its principal place of business, the location to
8which it proposes to move its principal place of business, and
9the date upon which the application was accepted for processing
10by the superintendent.
114. Within thirty days after acceptance of an application
12for approval of a change of location of the principal place
13of business of a state bank pursuant to subsection 3, the
14superintendent shall commence an investigation into the
15circumstances of the application as deemed necessary by
16the superintendent, giving due consideration to factors
17substantially similar to those set forth in section 524.305,
18subsection 1, paragraphs “c” through “f”. Within one hundred
19eighty ninety days after the application has been accepted for
20processing, the superintendent shall approve or disapprove
21the application on the basis of the investigation. The
22superintendent shall give written notice of the decision to the
23state bank, and in the event of disapproval a statement of the
24reasons for the disapproval. If the superintendent approves
25the change in location the superintendent shall deliver
26the articles of amendment to the secretary of state. As a
27condition of receiving the decision of the superintendent with
28respect to the application, the state bank shall reimburse the
29superintendent for all expenses incurred by the superintendent
30in connection with the application.
315. A state bank approved under the provisions of section
32524.305, subsection 8, shall not commence its business at
33any location other than within a municipal corporation or
34unincorporated area in which was located the principal place of
35business or an office of the state bank the condition of which
-25-1was the basis for the superintendent authorizing incorporation
2or organization of the new state bank.
3 Sec. 37. Section 524.313, Code 2021, is amended to read as
4follows:
5524.313 Bylaws.
6A state bank may adopt bylaws. The power to adopt, amend,
7or repeal bylaws or adopt new bylaws is vested in the board of
8directors unless reserved to the shareholders by the articles
9of incorporation. The bylaws of a state bank may contain any
10provisions for the regulation and management of the affairs
11of the state bank not inconsistent with law or the articles
12of incorporation. For a state bank organized as a limited
13liability company under this chapter, “bylaws” means the
14operating agreement of the state bank.
15 Sec. 38. Section 524.521, Code 2021, is amended to read as
16follows:
17524.521 Authorized shares.
181. The articles of incorporation of a state bank
19incorporated as a stock corporation must prescribe the classes
20of shares and series of shares within a class and the number
21of shares of each class that the state bank is authorized
22to issue. If more than one class or series of shares is
23authorized, the articles of incorporation must prescribe a
24distinguishing designation for each class or series, and before
25the issuance of shares of a class or series, describe the
26terms, including the preferences, rights, and limitations of
27that class or series. Prior to the issuance of shares of a
28class, the preferences, limitations, and relative rights of
29that class must be described in the articles of incorporation.
30All Except to the extent otherwise permitted by section
31524.522, all shares of a class or series must have terms,
32including preferences, rights, and limitations, and relative
33rights identical with those of other shares of the same class
34except to the extent otherwise permitted by section 524.523 or
35series.
-26- 12. The articles of incorporation of a state bank
2incorporated as a stock corporation must authorize both of the
3following:
4a. One or more classes or series of shares that together
5have unlimited full voting rights.
6b. One or more classes or series of shares, which may be the
7same class, or classes, or series as those with voting rights,
8that together are entitled to receive the net assets of the
9state bank upon dissolution.
103. The articles of incorporation of a state bank
11incorporated as a stock corporation may authorize one or more
12classes or series of shares that have any of the following
13qualities:
14a. Have special, conditional, or limited voting rights, or
15no right to vote, unless prohibited by this chapter.
16b. Are redeemable or convertible as specified in the
17articles of incorporation in any of the following ways:
18(1) At the option of the state bank, the shareholders, or
19another person or upon the occurrence of a designated specified
20 event.
21(2) For cash, indebtedness, securities, or other property.
22(3) In a designated amount or in an amount determined
23in accordance with a designated formula or by reference to
24extrinsic data or events.
25c. Preferred shares are redeemable only by resolution
26of the board of directors with the prior approval of the
27superintendent. Preferred shares which are redeemable
28according to the terms of their issuance shall be redeemed
29only in accordance with such terms. Preferred shares which
30are redeemed shall be canceled and shall not be reissued.
31Preferred shares which are not redeemable according to the
32terms of their issuance are redeemable only pro rata, by lot,
33or by such other equitable method as determined by the board
34of directors.
35d. (1) If preferred shares are redeemed by a state bank,
-27-1the redemption effects a cancellation of the shares, and
2a statement of cancellation shall be filed as provided in
3this paragraph. The filing of the statement of cancellation
4constitutes an amendment to the articles of incorporation and
5reduces the number of preferred shares of the class which the
6state bank is authorized to issue by the number which are
7canceled.
8(2) The statement of cancellation shall be executed by the
9state bank by its president or a vice president and by its
10cashier or an assistant cashier, and acknowledged by one of the
11officers signing such statement, and shall set forth all of the
12following:
13(a) The name of the state bank and the effective date of its
14articles of incorporation.
15(b) The number of preferred shares canceled through
16redemption, itemized by classes.
17(c) The aggregate number of issued shares, itemized by
18classes, after giving effect to the cancellation.
19(d) The amount, expressed in dollars, of the stated capital
20of the state bank after giving effect to the cancellation.
21(e) The number of shares which the state bank has authority
22to issue, itemized by classes, after giving effect to the
23cancellation.
24(3) The statement of cancellation, together with the
25applicable filing and recording fees, shall be delivered to
26the superintendent who shall, if the superintendent finds the
27statement of cancellation satisfies the requirements of this
28section, deliver it to the secretary of state for filing and
29recording in the secretary of state’s office and the statement
30of cancellation shall also be filed and recorded in the office
31of the county recorder. The capital of the state bank is
32deemed to be reduced by the par value of the shares canceled
33upon the effective date of the redemption.
34e. Entitle the holders to distributions calculated in
35any manner, including dividends that may be cumulative,
-28-1noncumulative, or partially cumulative.
2f. Have preference over any other class or series of
3shares with respect to distributions, including dividends and
4distributions upon the dissolution of the state bank.
54. The description of the designations, preferences,
6rights, and limitations, and relative rights of share classes
7or series of shares in subsection 3 is not all-inclusive
8 exhaustive.
95. Unless the articles of incorporation or bylaws otherwise
10provide, the board of directors, by resolution duly adopted and
11with the approval of the superintendent as provided in section
12524.405, may issue from time to time, in whole or in part, the
13shares authorized by the articles of incorporation.
14 Sec. 39. Section 524.522, subsection 1, unnumbered
15paragraph 1, Code 2021, is amended to read as follows:
16If the articles of incorporation provide for such, the
17board of directors may determine, in whole or in part, the
18preferences, rights, and limitations, and relative rights,
19 within the limits set forth in section 524.521, of either of
20the following:
21 Sec. 40. Section 524.523, subsection 2, unnumbered
22paragraph 1, Code 2021, is amended to read as follows:
23Each At a minimum, each share certificate must state on its
24face, at a minimum, all of the following:
25 Sec. 41. Section 524.523, subsection 3, Code 2021, is
26amended by striking the subsection and inserting in lieu
27thereof the following:
283. a. If the state bank is authorized to issue different
29classes of shares or series of shares within a class, the
30front or back of each certificate must summarize all of the
31following:
32(1) The preferences, rights, and limitations applicable to
33each class and series.
34(2) Any variations in preferences, rights, and limitations
35among the holders of the same class or series.
-29- 1(3) The authority of the board of directors to determine the
2terms of future classes or series.
3b. Alternatively, each certificate may state conspicuously
4on its front or back that the state bank will furnish to the
5shareholder the information in paragraph “a” on request in
6writing and without charge.
7 Sec. 42. Section 524.523, subsection 4, Code 2021, is
8amended to read as follows:
94. Each share certificate must be signed either manually or
10in facsimile by two officers as set forth in subsection 1, and
11may bear the corporate seal or its facsimile.
12 Sec. 43. Section 524.524, Code 2021, is amended to read as
13follows:
14524.524 Consideration for shares.
15Except in the case of a distribution of shares authorized by
16section 524.543 or shares issued upon exchanges or conversion,
17common or preferred shares of a state bank may be issued only
18for cash in an amount not less than that determined approved
19 by the superintendent.
20 Sec. 44. Section 524.525, subsection 4, paragraph b, Code
212021, is amended to read as follows:
22b. Unless the subscription agreement provides otherwise, the
23state bank may rescind the agreement and may sell the shares
24if the debt remains unpaid more than twenty days after the
25state bank sends delivers a written demand for payment to the
26subscriber.
27 Sec. 45. Section 524.526, Code 2021, is amended to read as
28follows:
29524.526 Fractional shares.
301. A state bank incorporated as a stock corporation may
31issue fractions of a share or in lieu of doing so may do any of
32the following:
33a. Issue fractions of a share or pay Pay in money cash the
34value of fractions of a share.
35b. Issue scrip in registered or bearer form entitling the
-30-1holder to receive a full share upon surrendering enough scrip
2to equal a full share.
3b. c. Arrange for disposition of fractional shares by the
4shareholders of the state bank.
5c. Issue scrip in registered or bearer form entitling the
6holder to receive a full share upon surrendering enough scrip
7to equal a full share.
82. Each certificate representing scrip must be
9conspicuously labeled “scrip” and must contain the information
10required by section 524.523, subsection 2.
113. The holder of a fractional share or scrip is entitled
12to exercise the rights of a shareholder, including the right
13 rights to vote, to receive dividends, and to participate in
14the assets of the state bank upon liquidation, but only if the
15fractional share or scrip provides for such rights.
164. The board of directors may authorize the issuance of
17scrip subject to any condition considered desirable, including
18either of the following:
19a. That the scrip will become void if not exchanged for full
20shares before a specified date.
21b. That the shares for which the scrip is exchangeable may
22be sold and the proceeds paid to the scrip holders.
23 Sec. 46. Section 524.527, subsections 1 and 2, Code 2021,
24are amended to read as follows:
251. A purchaser of the shares of a state bank incorporated
26as a stock corporation is not liable to the state bank, its
27creditors, or depositors with respect to the shares except to
28pay the consideration for which the shares were authorized to
29be issued under section 524.521, or the consideration specified
30in the subscription agreement authorized under section 524.525.
312. Unless otherwise provided in the articles of
32incorporation, a A shareholder of a state bank is not
33personally liable for any liabilities of the state bank,
34including liabilities arising from the acts or debts of the
35state bank, its creditors, or depositors., subject to the
-31-1following exceptions:
2a. To the extent provided in a provision of the articles
3of incorporation permitted by section 524.302, subsection 2,
4paragraph “c”.
5b. By reason of the shareholder’s own acts or conduct.
6 Sec. 47. Section 524.528, subsections 1 and 2, Code 2021,
7are amended to read as follows:
81. The shareholders of a state bank do not have a preemptive
9right to acquire the state bank’s unissued shares except to the
10extent provided in the articles of incorporation so provide.
112. A statement included in the articles of incorporation
12that “the state bank elects to have preemptive rights”, or
13words of similar import effect, means that, the following
14principles apply except to the extent otherwise expressly
15provided in the articles of incorporation, the following
16principles apply expressly provide otherwise:
17a. A shareholder The shareholders of a state bank has have
18 a preemptive right, granted on uniform terms and conditions
19prescribed by the board of directors to provide a fair and
20reasonable opportunity to exercise the right, to acquire a
21proportional amount of the state bank’s unissued shares upon
22the decision of the board of directors to issue such shares.
23b. A shareholder may waive the shareholder’s preemptive
24right. A waiver evidenced in writing is irrevocable even
25though it is not supported by consideration.
26c. There is no preemptive right with respect to any of the
27following:
28(1) Shares issued as compensation to directors, managers,
29officers, employees, or agents, or employees of the state bank,
30its subsidiaries, or its affiliates.
31(2) Shares issued to satisfy conversion or option rights
32created to provide compensation to directors, managers,
33officers, employees, or agents, or employees of the state bank,
34its subsidiaries, or its affiliates.
35(3) Shares authorized in the articles of incorporation
-32-1that are issued within six months from the effective date of
2incorporation or organization.
3d. A holder Holders of shares of any class or series without
4general voting rights power but with preferential rights to
5distributions or assets has have no preemptive rights with
6respect to shares of any class or series.
7e. A holder Holders of shares of any class or series with
8general voting rights power but without preferential rights
9to distributions or assets has have no preemptive rights with
10respect to shares of any class or series with preferential
11rights to distributions or assets unless the shares with
12preferential rights are convertible into or carry a right to
13subscribe for or acquire shares without preferential rights.
14f. Shares subject to preemptive rights that are not acquired
15by shareholders may be issued to any person for a period of one
16year after being offered to shareholders at a consideration
17set by the board of directors that is not lower than the
18consideration set for the exercise of preemptive rights. An
19offer at a lower consideration or after the expiration of one
20year is subject to the shareholders’ preemptive rights.
21 Sec. 48. Section 524.532, Code 2021, is amended to read as
22follows:
23524.532 Meetings of shareholders.
24Meetings of shareholders may be held at a place, within
25this state, as provided in the articles of incorporation or
26the bylaws, or as fixed in accordance with their provisions.
27In the absence of any such provision, all meetings shall be
28held at the principal place of business of the state bank.
29An annual meeting of the shareholders shall be held during
30the specific month as shall be provided in the articles of
31incorporation, at the location, date, and time as stated in
32or fixed in accordance with the bylaws. Failure to hold the
33annual meeting during the month shall not work a forfeiture
34or dissolution of the state bank. Special meetings of the
35shareholders may be called by the president, the board of
-33-1directors, the holders of not less than one-tenth of all the
2shares entitled to vote at the meeting, or other officers or
3persons as provided in the articles of incorporation or the
4bylaws. If a state bank holds a shareholder meeting at a
5location outside this state, the articles of incorporation or
6bylaws must permit any or all shareholders to participate by
7any means of communication as specified in section 524.533,
8subsection 4.
9 Sec. 49. Section 524.533, subsections 1 and 3, Code 2021,
10are amended to read as follows:
111. Written notice stating the place, day and hour of a
12meeting of the shareholders and, in case of a special meeting,
13the purpose or purposes for which the meeting is called, shall
14be delivered not less than ten nor more than sixty days before
15the date of the meeting, either personally or by mail, by or
16at the direction of the president, the cashier, or the officer
17or persons calling the meeting, to each shareholder of record
18entitled to vote at the meeting. If mailed, the notice is
19deemed to be delivered when deposited in the United States mail
20addressed to the shareholder at the shareholder’s address as
21it appears on the stock transfer books of the state bank with
22postage prepaid. As used in this section, the term “notice”
23 means as defined in section 490.141.
243. A shareholder’s attendance at a meeting results in both
25 all of the following:
26a. Waives the shareholder’s objection to lack of notice or
27defective notice of the meeting, unless the shareholder at the
28beginning of the meeting or promptly upon the shareholder’s
29arrival objects to holding the meeting or transacting business
30at the meeting.
31b. Waives the shareholder’s objection to consideration
32of a particular matter at the meeting that is not within the
33purpose or purposes described in the meeting notice, unless
34the shareholder objects to considering the matter when it is
35presented.
-34-1 Sec. 50. Section 524.535, subsection 2, Code 2021, is
2amended to read as follows:
32. The bylaws or, in the absence of an applicable bylaw,
4the board of directors may fix or provide the manner of fixing,
5in advance, a date as the record date for any determination of
6shareholders entitled to notice of or a shareholder’s meeting,
7to demand a special meeting, to vote, or to take any other
8action at a meeting of shareholders, the. A record date to be
9 fixed under this section shall not be more than seventy days
10and, in the case of a meeting of shareholders, not less than
11ten days prior to before the date on which of the meeting or
12 particular action, requiring the determination of shareholders,
13is to be taken and shall not be retroactive. If a record date
14is not fixed for the determination of shareholders entitled
15to notice of or to vote at a meeting of shareholders, or
16shareholders entitled to receive payment of a dividend, the
17date on which notice of the meeting is mailed or the date on
18which the resolution of the board of directors declaring such
19dividend is adopted, as the case may be, shall be the record
20date for the determination of shareholders. If a determination
21of shareholders entitled to vote at any meeting of shareholders
22has been made as provided in this section, the determination
23applies to any adjournment of the meeting.
24 Sec. 51. Section 524.536, Code 2021, is amended by striking
25the section and inserting in lieu thereof the following:
26524.536 Shareholders’ voting list for meeting.
271. The officer or agent having charge of the stock transfer
28books for shares of a state bank shall, at least ten days
29before each meeting of shareholders, prepare a complete
30alphabetical list of the names of all its shareholders who
31are entitled to vote at the meeting or any adjournment of the
32meeting. The list shall be arranged by voting group and within
33each voting group by class or series of shares, and show the
34address of and the number of shares held by each shareholder.
35Nothing contained in this subsection shall require the state
-35-1bank to include on such list the electronic mail address or
2other electronic contact information of a shareholder.
32. a. The shareholders’ list shall be available for
4inspection by any shareholder beginning ten days before the
5meeting and continuing through the meeting. The shareholders’
6list shall be made available in at least one of the following
7locations:
8(1) The state bank’s principal place of business.
9(2) A reasonably accessible electronic network, provided
10that the information required to gain access to the list is
11provided with the notice of the meeting. In the event that
12the state bank determines to make the list available on an
13electronic network, the state bank shall take reasonable
14steps to ensure that such information is available only to
15shareholders of the state bank.
16b. A shareholder, or the shareholder’s agent or attorney,
17is entitled on written demand to inspect the list at any time
18during usual business hours and at the shareholders’ expense,
19during the period it is available for inspection.
203. The list of shareholders shall also be produced and
21kept open at the time and place of the meeting and is subject
22to the inspection of a shareholder, or a shareholder’s agent
23or attorney, during the entire duration of the meeting. The
24original stock transfer books are prima facie evidence as to
25which shareholders are entitled to examine the list or transfer
26books or to vote at a meeting of shareholders.
274. Failure to comply with the requirements of this section
28shall not affect the validity of action taken at a meeting of
29shareholders.
30 Sec. 52. Section 524.537, Code 2021, is amended by adding
31the following new subsection:
32 NEW SUBSECTION. 3. If a quorum is present, the affirmative
33vote of the majority of the shares represented at the meeting
34and entitled to vote on the subject matter shall be the act of
35the shareholders, unless the vote of a greater number or voting
-36-1by classes is required by the laws of this state or of the
2United States or by the articles of incorporation or bylaws.
3This requirement does not apply to the election of directors as
4provided in section 524.538, subsection 4.
5 Sec. 53. Section 524.538, subsections 1, 3, and 5, Code
62021, are amended to read as follows:
71. Each outstanding share of a state bank shall be entitled
8to one vote on each matter submitted to a vote at a meeting of
9shareholders, except to the extent that the voting rights of
10the shares of a class or series may be limited or denied by the
11articles of incorporation.
123. A shareholder may vote either in person or by proxy
13executed in writing by the shareholder or by the shareholder’s
14duly authorized attorney in fact attorney-in-fact. A proxy
15shall not be valid after eleven months from the date of its
16execution.
175. In an election of directors, a state bank shall not
18vote its own shares held by it as sole trustee unless under
19the terms of the trust the manner in which such shares shall
20be voted may be determined by a donor or beneficiary of the
21trust and unless such donor or beneficiary actually directs
22how the shares shall be voted. However, shares held in trust
23by a state bank pursuant to an instrument in effect prior to
24January 1, 1970, under the terms of which the manner in which
25such shares shall be voted could not be determined by a donor
26or beneficiary of the trust, may be voted in an election of
27directors of a state bank upon petition filed by the state
28bank, to a court of competent jurisdiction, and the appointment
29by such court of an individual to determine the manner in which
30the shares shall be voted. When the shares of a state bank are
31held by such state bank and one or more persons as trustees,
32the shares may be voted by such other person or persons as
33trustees, in the same manner as if the person or persons were
34the sole trustee. Whenever shares cannot be voted by reason
35of being held by a state bank as sole trustee, the shares shall
-37-1be excluded in determining whether matters voted upon by the
2shareholders were adopted by the requisite number of shares.
3 Sec. 54. Section 524.538A, Code 2021, is amended to read as
4follows:
5524.538A Voting by member of mutual corporation.
6All holders of savings, demand, or other authorized
7accounts of a state bank incorporated as or converted to be
8a mutual corporation are members of the state bank. In the
9consideration of all questions requiring action by the members
10of the state bank, each holder of an account shall be permitted
11to cast one vote for each one hundred dollars, or fraction
12thereof, of the withdrawal value of the member’s account. No
13member, however, shall cast more than one thousand member
14votes. All accounts shall be nonassessable.
15 Sec. 55. Section 524.544, subsection 1, Code 2021, is
16amended to read as follows:
171. Whenever any person proposes to purchase or otherwise
18acquire directly or indirectly any of the outstanding shares
19of a state bank, and the proposed purchase or acquisition
20would result in control or in a change in control of the
21state bank, the person proposing to purchase or acquire the
22shares shall first apply in writing to the superintendent
23for a certificate of approval for the proposed change of
24control. The superintendent shall grant the certificate if
25the superintendent is satisfied that the person who proposes
26to obtain control of the state bank is qualified by character,
27experience, and financial responsibility to control and
28operate the state bank in a sound and legal manner, and that
29the interests of the depositors, creditors, and shareholders
30of the state bank, and of the public generally, will not be
31jeopardized by the proposed change of control. A person
32which will become a bank holding company upon completion of
33an acquisition shall make application to the superintendent
34for a certificate of approval as provided in this section.
35Any other bank holding company shall comply with section
-38-1524.1804 in lieu of seeking a certificate of approval under
2this section. In any situation where the president or cashier
3of a state bank has reason to believe any of the foregoing
4requirements have not been complied with, it shall be the duty
5of the president or cashier to promptly report in writing such
6facts to the superintendent upon obtaining knowledge thereof.
7As used in this section, the term “control” means the power,
8directly or indirectly, to elect the board of directors. If
9there is any doubt as to whether a change in the ownership
10of the outstanding shares is sufficient to result in control
11thereof, or to effect a change in the control thereof, such
12doubt shall be resolved in favor of reporting the facts to the
13superintendent.
14 Sec. 56. Section 524.544, Code 2021, is amended by adding
15the following new subsection:
16 NEW SUBSECTION. 1A. As used in this section, the term
17“control” means owning, controlling, or having the power to vote
18twenty-five percent or more of any class of voting securities
19of a state bank or having the power, directly or indirectly,
20to elect the board of directors. If there is any doubt as to
21whether a change in the ownership of the outstanding shares is
22sufficient to result in control thereof, or to effect a change
23in the control thereof, such doubt shall be resolved in favor
24of reporting the facts to the superintendent.
25 Sec. 57. Section 524.544, subsection 2, Code 2021, is
26amended by striking the subsection.
27 Sec. 58. Section 524.604, subsection 1, paragraph d, Code
282021, is amended to read as follows:
29d. Review of the adequacy of the state bank’s internal
30controls and determination of the most appropriate method
31to satisfy the state bank’s audit needs pursuant to section
32524.608.
33 Sec. 59. Section 524.604, subsection 2, Code 2021, is
34amended to read as follows:
352. Directors of a state bank shall discharge the duties
-39-1of their position in good faith and with that diligence, care
2and skill which ordinarily prudent persons would exercise
3under similar circumstances in like positions. The directors
4shall have a continuing responsibility to assure themselves
5that the state bank is being managed according to law and that
6the practices and policies adopted by the board are being
7implemented.
8 Sec. 60. Section 524.605, subsection 1, paragraph a, Code
92021, is amended to read as follows:
10a. Directors of a state bank who vote for or assent to
11the declaration of any dividend or other distribution of the
12assets of a state bank to its shareholders in willful or
13negligent violation of the provisions of this chapter, or of
14any restrictions contained in the articles of incorporation,
15or of any order by the superintendent restricting the payment
16of dividends or other distribution of assets, shall be jointly
17and severally liable to the state bank for the amount of such
18dividend which is paid or the value of such assets which
19are distributed in excess of the amount of such dividend or
20distribution which could have been paid or distributed without
21a violation of the provisions of this chapter, or of the
22restrictions in the articles of incorporation, or of any order
23by the superintendent restricting the payment of dividends or
24other distribution of assets.
25 Sec. 61. Section 524.606, subsection 2, paragraph a, Code
262021, is amended to read as follows:
27a. If, in the opinion of the superintendent, any director
28of a state bank or bank holding company has violated any
29law relating to such state bank or bank holding company, or
30 has engaged in unsafe or unsound practices in conducting the
31business of such state bank or bank holding company, or has
32caused such state bank or bank holding company to violate any
33provision of this chapter or any other law relating to banks
34or banking, the superintendent may cause notice to be served
35upon such director, to appear before the superintendent to
-40-1show cause why the director should not be removed from office.
2A copy of such notice shall be sent to each director of the
3state bank or bank holding company affected, by registered or
4certified mail. If, after granting the accused director a
5reasonable opportunity to be heard, the superintendent finds
6that the director violated any law relating to such state
7bank or bank holding company, or engaged in unsafe or unsound
8practices in conducting the business of such state bank or bank
9holding company, or has caused such state bank or bank holding
10company to violate any provision of this chapter or any other
11law relating to banks or banking, the superintendent, in the
12superintendent’s discretion, may order that such director be
13removed from office, and that such director be prohibited from
14serving in any capacity in any other state bank, bank holding
15company, bank affiliate, trust company, or an entity licensed
16under chapter 533A, 533C, 533D, 535B, 536, or 536A. A copy
17of the order shall be served upon such director and upon the
18state bank or bank holding company of which the person is a
19director at which time the person shall cease to be a director
20of the state bank or bank holding company. The resignation,
21termination of employment, or separation of such director,
22including a separation caused by the closing of the state
23bank or bank holding company at which the person serves as a
24director, does not affect the jurisdiction and authority of the
25superintendent to cause notice to be served and proceed under
26this subsection against the director, if the notice is served
27before the end of the six-year period beginning on the date the
28director ceases to be a director with the state bank.
29 Sec. 62. Section 524.607, subsections 1 and 2, Code 2021,
30are amended to read as follows:
311. The board of directors shall hold at least nine regular
32meetings each calendar year. No more than one regular meeting
33shall be held in any one calendar month. Unless the articles
34of incorporation or bylaws provide otherwise, any director may
35participate in any meeting of the board of directors may permit
-41-1directors to participate in meetings through the use of any
2means of communication by which all directors participating
3may simultaneously hear each other during the meeting. A
4director participating in a meeting by this means is deemed to
5be present at the meeting.
62. A special meeting may be called by any executive officer
7or a director. Notice of a meeting shall be given to each
8director, either personally or by mail, at least two days in
9advance of the meeting. Notice of a regular meeting shall
10not be required if the articles of incorporation, bylaws, or
11a resolution of the board of directors provide for a regular
12monthly meeting date. As used in this section, the term
13“notice” means as defined in section 490.141.
14 Sec. 63. Section 524.607, Code 2021, is amended by adding
15the following new subsection:
16 NEW SUBSECTION. 2A. A director may waive any notice
17required by this chapter, the articles of incorporation, or the
18bylaws before or after the date and time stated in the notice.
19Except as provided in subsection 3, the waiver must be in
20writing, signed by the director entitled to the notice, whether
21before or after the time stated in the notice, and delivered to
22the state bank for filing by the state bank with the minutes or
23corporate records.
24 Sec. 64. Section 524.607, subsection 3, Code 2021, is
25amended by striking the subsection and inserting in lieu
26thereof the following:
273. A director’s attendance at or participation in a meeting
28waives any required notice to the director of such meeting
29unless all of the following apply:
30a. The director at the beginning of the meeting, or promptly
31upon arrival, objects to holding the meeting or transacting
32business at the meeting because the meeting is not lawfully
33called or convened.
34b. The director does not, after objecting, vote for or
35assent to action taken at the meeting.
-42-1 Sec. 65. Section 524.607, subsection 4, Code 2021, is
2amended by striking the subsection.
3 Sec. 66. Section 524.607A, subsection 1, Code 2021, is
4amended to read as follows:
51. Unless the articles of incorporation or bylaws provide
6otherwise, action required or permitted to be taken under this
7chapter at a board of directors’ meeting may be taken without
8a meeting if the action is consented to by all members of the
9board. The action must be evidenced by one or more written
10consents describing the action taken, signed by each director,
11and included in the minutes or filed with the corporate records
12reflecting the action taken. A director may evidence the
13consent required by this subsection by sending a message by
14electronic mail that expressly indicates the director’s consent
15to the proposed action.
16 Sec. 67. Section 524.608, Code 2021, is amended to read as
17follows:
18524.608 Auditing procedures.
191. In addition to any examination made by the banking
20division or other supervisory agency, the board of directors
21shall review the adequacy of the state bank’s internal controls
22and cause to be made no less frequently than once each calendar
23year additional auditing procedures that the board deems to
24be appropriate. The board shall determine the state bank’s
25audit needs and record in the board’s minutes the extent to
26which audit procedures are to be employed. A report which
27summarizes significant audit findings shall be delivered to the
28superintendent as soon as practical upon completion.
292. The superintendent may require that more comprehensive
30auditing procedures be applied to a state bank’s account
31records when deemed necessary. These auditing procedures
32may range from limited scope agreed-upon procedures to an
33unqualified audit opinion.
34 Sec. 68. Section 524.610, subsection 1, Code 2021, is
35amended to read as follows:
-43- 11. The shareholders of a state bank shall fix the
2reasonable compensation of directors for their services as
3members of the board of directors. Subject to approval by
4the shareholders at an annual or special meeting called for
5that purpose, the shareholders of a state bank may adopt a
6pension or profit-sharing plan, or both, or other plan of
7deferred compensation for directors, to which a state bank may
8contribute. Changes to such a pension or profit-sharing plan
9or other plan of deferred compensation, other than changes
10that affect eligibility requirements for directors under the
11plan, benefits provided to directors pursuant to the plan, and
12contributions required by the state bank or directors under
13the plan, may be adopted by the board of directors without
14shareholder approval.
15 Sec. 69. Section 524.611, subsection 2, Code 2021, is
16amended to read as follows:
172. The oath shall be signed by the director, acknowledged
18before an officer individual authorized to take acknowledgments
19of deeds perform notarial acts, and delivered to the
20superintendent.
21 Sec. 70. Section 524.703, subsection 2, Code 2021, is
22amended to read as follows:
232. Subject to approval by the shareholders at an annual or
24special meeting called for the purpose, the board of directors
25of a state bank may adopt a pension or profit-sharing plan,
26or both, or other plan of deferred compensation, for both
27officers and employees, to which the state bank may contribute.
28Changes to such a pension or profit-sharing plan or other
29plan of deferred compensation, other than changes that affect
30eligibility requirements for officers and employees under the
31plan, benefits provided to officers and employees pursuant to
32the plan, and contributions required by state banks, officers,
33or employees under the plan, may be adopted by the board of
34directors without shareholder approval.
35 Sec. 71. Section 524.707, subsection 2, Code 2021, is
-44-1amended to read as follows:
22. Section 524.606, subsection 2, which provides for the
3removal of directors by the superintendent, shall have equal
4application to officers and employees of a state bank, bank
5holding company, bank affiliate, or trust company.
6 Sec. 72. Section 524.802, subsections 9, 11, and 13, Code
72021, are amended to read as follows:
89. Acquire and hold shares of stock in the appropriate
9federal home loan bank and to exercise all powers conferred
10on member banks of the federal home loan bank system that are
11not inconsistent with this chapter. A purchase of federal
12home loan bank shares which causes the state bank’s holdings
13to exceed fifteen percent of aggregate capital, including
14where the ownership of shares exceeding fifteen percent of
15the state bank’s aggregate capital is needed to support the
16state bank’s participation in the federal home loan bank’s
17acquired member assets program provided for in 12 C.F.R. pt.
18955, requires the prior approval of the superintendent. In
19addition, a state bank may own federal home loan bank shares
20in an amount exceeding fifteen percent of the state bank’s
21aggregate capital, but not exceeding twenty-five percent of
22the state bank’s aggregate capital, if the ownership of shares
23exceeding fifteen percent is needed to support the state bank’s
24participation in the federal home loan bank’s acquired member
25assets program as provided for in 12 C.F.R. pt.955.
2611. Become Subject to section 524.109, subsection 2, become
27 a member of a bankers’ bank.
2813. Acquire, hold, and improve real estate for the sole
29purpose of economic or community development, provided that
30the state bank’s aggregate investment in all acquisitions and
31improvements of real estate under this subsection shall not
32exceed fifteen percent of a state bank’s aggregate capital and
33shall be subject to the prior approval of the superintendent,
34the state bank provides the superintendent with thirty days’
35prior written notice of its intention to acquire, hold, and
-45-1improve the real estate, and the superintendent does not object
2to the state bank’s proposed plan within thirty days. For
3purposes of this section, the term “community development”
4 includes public welfare investments as defined in section
5524.901, subsection 7, paragraph “a”, and other investments as
6permitted under 12 U.S.C. §24 and its implementing regulations.
7 Sec. 73. NEW SECTION. 524.802A Electronic activities of
8state bank.
91. A state bank may conduct in electronic form any
10activities that are expressly authorized for state banks under
11any provision of this chapter, including in sections 524.801,
12524.802, and 524.804, and activities that are the functional
13equivalent of any activities expressly authorized for state
14banks under this chapter. A state bank may perform, provide,
15or deliver through electronic means any activity, function,
16product, or service it is authorized to perform by any
17provision of this chapter and must comply with all applicable
18laws and regulations.
192. Subject to the prior approval of the superintendent,
20a state bank may, beginning on July 1, 2021, engage in new
21or innovative electronic activities that are part of the
22business of banking. When determining whether a state bank is
23authorized to engage in a new or innovative electronic activity
24that is not traditionally offered by banks via electronic
25means, the superintendent shall consider whether the activity
26is expressly authorized for state banks under this chapter,
27whether the activity is the functional equivalent of any
28activity authorized for state banks, whether the activity
29is a logical extension of any activity authorized for state
30banks, whether the state bank has the expertise necessary to
31understand and manage the activity, and whether the activity
32presents risks similar to those state banks already assume.
333. A state bank that engages in any new or innovative
34electronic activities must conduct these activities in a
35safe and sound manner and must maintain adequate systems to
-46-1identify, measure, monitor, and control the risks associated
2with its electronic activities. These systems must include
3policies, procedures, internal controls, and management
4information systems governing the electronic activities of
5the state bank and may be tailored to the specific risks
6presented by the electronic activities of the state bank. A
7state bank engaging in new or innovative electronic activities
8must also maintain adequate and effective information security
9infrastructure and controls.
104. The superintendent may adopt rules pursuant to chapter
1117A to implement the provisions of this section, including
12but not limited to application procedures, identifying the
13systems, processes, and technologies a state bank must maintain
14in order to engage in certain new or innovative electronic
15activities, and determining that additional new or innovative
16electronic activities are authorized for state banks without
17prior approval.
18 Sec. 74. Section 524.803, subsection 3, Code 2021, is
19amended to read as follows:
203. Any real property which is held by a state bank pursuant
21to this section and which it ceases to use for banking
22purposes, or is acquired for future use but not used within
23a reasonable period of time five years after title is vested
24in the state bank, shall be sold or disposed of by the state
25bank as directed by the superintendent. This deadline may be
26extended up to an additional five years with prior approval of
27the superintendent, but in no event may a state bank hold the
28property for more than ten years.
29 Sec. 75. Section 524.810A, subsection 1, unnumbered
30paragraph 1, Code 2021, is amended to read as follows:
31A bank shall permit a person named in and authorized by a
32court order to open, examine, and remove the contents of a safe
33deposit box located at the bank. If a court order has not been
34delivered to the bank, the following persons may access and
35remove any or all contents of a safe deposit box located at a
-47-1state bank which box is described in an ownership or rental
2agreement or lease between the state bank and a deceased owner
3or lessee:
4 Sec. 76. Section 524.812, subsection 3, Code 2021, is
5amended to read as follows:
63. If the contents are not claimed within two years after
7their removal from the safe deposit box, the state bank may
8proceed to sell so much of the contents as is necessary to
9pay the past due rentals and the expense incurred in opening
10the safe deposit box, replacement of the locks thereon and
11the sale of the contents. The sale shall be held at the time
12and place specified in a notice published prior to the sale
13once each week for two successive weeks in a newspaper of
14general circulation published in the municipal corporation or
15unincorporated area in which the state bank has its principal
16place of business, or if there is none, a newspaper of general
17circulation published in the county, or in a county adjoining
18the county, in which the state bank has its principal place of
19business. The state bank shall also post this notice on the
20state bank’s internet site for at least two weeks prior to the
21sale. A copy of the notice so published shall be mailed to the
22customer at the customer’s last known address as shown upon the
23records of the state bank. The notice shall contain the name
24of the customer and need only describe the contents of the safe
25deposit box in general terms. The contents of any number of
26safe deposit boxes may be sold under one notice of sale and the
27cost thereof apportioned ratably among the several safe deposit
28box customers involved. At the time and place designated
29in said notice the contents taken from each respective safe
30deposit box shall be sold separately to the highest bidder for
31cash and the proceeds of each sale applied to the rentals and
32expenses due to the state bank and the residue from any such
33sale shall be held by the state bank for the account of the
34customer or customers. Any amount so held as proceeds from
35such sale shall be credited with interest at the customary
-48-1annual rate for savings accounts at said state bank, or in lieu
2thereof, at the customary rate of interest in the community
3where such proceeds are held. The crediting of interest shall
4not activate said account to avoid an abandonment as unclaimed
5property under chapter 556.
6 Sec. 77. Section 524.816, Code 2021, is amended by striking
7the section and inserting in lieu thereof the following:
8524.816 Deposit account insurance.
9A state bank organized under this chapter shall be an
10insured bank and shall acquire and maintain insurance from the
11federal deposit insurance corporation, or its successor, to
12protect each depositor against loss of funds held on account
13by the state bank to the extent the federal deposit insurance
14corporation insures such deposits.
15 Sec. 78. Section 524.819, Code 2021, is amended to read as
16follows:
17524.819 Clearing checks at par.
18Checks drawn on a state bank shall be cleared at par by the
19state bank on which they are drawn. This section shall not be
20applicable where checks are received by a state bank as special
21collection items.
22 Sec. 79. Section 524.821, Code 2021, is amended to read as
23follows:
24524.821 Electronic transmission of funds — restrictions.
251. A state bank may engage in any transaction incidental
26to the conduct of the business of banking and otherwise
27permitted by applicable law, by means of either the direct
28transmission of electronic impulses to or from customers and
29banks or the recording of electronic impulses or other indicia
30of a transaction for delayed transmission to a bank. Subject
31to the provisions of chapter 527, except as preempted by
32other applicable law, a state bank may utilize, establish, or
33operate, alone or with one or more other banks, federal savings
34and loan associations incorporated under federal law, credit
35unions incorporated under the provisions of chapter 533 or
-49-1federal law, corporations licensed under chapter 536A, or third
2parties, the satellite terminals permitted under chapter 527,
3by means of which customers and banks may transmit and receive
4electronic impulses constituting transactions pursuant to this
5section. However, except as preempted by other applicable
6law, such utilization, establishment, or operation shall be
7lawful only when in compliance with chapter 527. Nothing in
8this section shall be construed as authority for any person to
9engage in transactions not otherwise permitted by applicable
10law, nor shall anything in this section be deemed to repeal,
11replace or in any other way affect any applicable law or rule
12regarding the maintenance of or access to financial information
13maintained by any bank.
142. A state bank which offers its customers, or any of them,
15the opportunity to engage in transactions with or through the
16state bank in the manner authorized by subsection 1 shall not
17require a customer to deal with or through the state bank in
18that manner in lieu of writing checks in the usual manner
19upon a conventional checking account, and shall not impose
20any extraordinary charge upon customers who choose to write
21checks in the usual manner upon a conventional checking account
22maintained at that state bank. The term “extraordinary charge”,
23as used in this subsection, is a charge in excess of a fair and
24reasonable charge, based upon the costs to the state bank of
25providing and maintaining checking account services.
26 Sec. 80. Section 524.901, subsection 7, paragraph a,
27subparagraph (2), Code 2021, is amended to read as follows:
28(2) Community development corporations or community
29development projects Public welfare investments to the same
30extent a national bank may invest in such corporations or
31projects pursuant to 12 U.S.C. §24 and its implementing
32regulations.
33 Sec. 81. Section 524.901, subsection 7, paragraph a,
34subparagraph (3), Code 2021, is amended by striking the
35subparagraph.
-50-1 Sec. 82. Section 524.901, subsection 7, paragraph c, Code
22021, is amended by adding the following new subparagraph:
3 NEW SUBPARAGRAPH. (02) The term “public welfare
4investment” means an investment that primarily benefits low
5and moderate-income individuals, low and moderate-income
6areas, or other areas targeted by a governmental entity for
7redevelopment. “Public welfare investment” includes investments
8that primarily support any of the types of activities
9identified in 12 C.F.R. §24.6. “Public welfare investment”
10includes an investment that would receive consideration under
1112 C.F.R. pt.25 as a qualified investment. “Public welfare
12investment” includes an investment in any of the following
13areas:
14(a) A targeted service area as defined in section 8B.1,
15subsection 13.
16(b) A small city as defined in section 15.352, subsection
1710.
18(c) An area of the state that is not part of a federally
19designated standard metropolitan statistical area.
20 Sec. 83. Section 524.901, subsection 8, Code 2021, is
21amended to read as follows:
228. A state bank, in the exercise of the powers granted in
23this chapter, may purchase cash value life insurance contracts
24which may include provisions for the lump sum payment of
25premiums and which may include insurance against the loss of
26the lump sum payment. State banks may only purchase cash
27value life insurance contracts if the contract is tied to an
28employee benefit the state bank is obligated to pay. The cash
29value life insurance contracts, together with the investment in
30annuity contracts authorized in subsection 8A, purchased from
31any one company shall not exceed fifteen percent of aggregate
32capital of the state bank, and in the aggregate from all
33companies, together with the investment in annuity contracts
34authorized in subsection 8A, shall not exceed twenty-five
35percent of aggregate capital of the state bank unless the state
-51-1bank has obtained the approval of the superintendent prior
2to the purchase of any cash value life insurance contract in
3excess of this limitation. Purchase and sale of such contracts
4shall be conducted in accordance with safe and sound banking
5practices.
6 Sec. 84. Section 524.901, Code 2021, is amended by adding
7the following new subsections:
8 NEW SUBSECTION. 8A. A state bank, in the exercise of
9the powers granted in this chapter, may purchase annuity
10contracts so long as the annuity contract is tied to an
11employee benefit the state bank is obligated to pay. The
12total investment in annuity contracts purchased from any
13one company, together with the cash value of life insurance
14contracts authorized in subsection 8, shall not exceed fifteen
15percent of aggregate capital of the state bank, and in the
16aggregate from all companies, together with the cash value of
17life insurance contracts authorized in subsection 8, shall not
18exceed twenty-five percent of aggregate capital of the state
19bank unless the state bank has obtained the approval of the
20superintendent prior to the purchase of any cash value life
21insurance contract in excess of this limitation. Purchase and
22sale of such contracts shall be conducted in accordance with
23safe and sound banking practices.
24 NEW SUBSECTION. 10. A state bank, upon the approval of the
25superintendent, may invest in the shares or equity interests
26of any corporation or other entity which develops or utilizes
27new or innovative technologies that are or may be applicable
28to the provision of banking or other financial products or
29services, including the covered services identified in section
30524.218, subsection 2. A state bank’s total investment in
31any combination of shares or equity interests of the entities
32identified in this paragraph shall not exceed five percent of
33its aggregate capital.
34 Sec. 85. Section 524.904, subsection 2, Code 2021, is
35amended to read as follows:
-52- 12. A state bank may grant loans and extensions of credit to
2one borrower in an amount not to exceed fifteen percent of the
3state bank’s aggregate capital as defined in section 524.103,
4unless the additional lending provisions provision described in
5subsection 3 or 4 apply applies.
6 Sec. 86. Section 524.904, subsection 3, paragraphs a, b, and
7e, Code 2021, are amended by striking the paragraphs.
8 Sec. 87. Section 524.904, subsection 4, Code 2021, is
9amended by striking the subsection.
10 Sec. 88. Section 524.904, subsection 5, paragraph a, Code
112021, is amended to read as follows:
12a. A state bank may grant loans and extensions of credit
13to a borrowing group in an amount not to exceed twenty-five
14percent of the state bank’s aggregate capital if all loans and
15extensions of credit to any one borrower within a borrowing
16group conform to subsection 2 or 3, and the financial strength,
17assets, guarantee, or endorsement of any one borrowing group
18member is not relied upon as a basis for loans and extensions
19of credit to any other borrowing group member. A state bank
20may grant loans and extensions of credit to a borrowing group
21in an amount not to exceed thirty-five percent of aggregate
22capital if all loans and extensions of credit to any one
23borrower within a borrowing group conform to subsection 2,
243, or 4, and the financial strength, assets, guarantee, or
25endorsement of any one borrowing group member is not relied
26upon as a basis for loans and extensions of credit to any
27other borrowing group member. While not to be construed as an
28endorsement of the quality of any loan or extension of credit,
29the superintendent may authorize a state bank to grant loans
30and extensions of credit to a borrowing group in an amount not
31to exceed fifty percent of aggregate capital if all loans and
32extensions of credit to any one borrower within a borrowing
33group conform to subsection 2 or 3, and the financial strength,
34assets, guarantee, or endorsement of any one borrowing group
35member is not relied upon as a basis for loans and extensions
-53-1of credit to any other borrowing group member.
2 Sec. 89. Section 524.905, subsections 2 and 3, Code 2021,
3are amended to read as follows:
42. Protective payments — escrow accounts. A bank may
5include in the loan documents signed by the borrower a
6provision requiring the borrower to pay the bank each month in
7addition to interest and principal under the note an amount
8equal to one-twelfth of the estimated annual real estate
9taxes, special assessments, hazard insurance premium, mortgage
10insurance premium, or any other payment agreed to by the
11borrower and the bank in order to better secure the loan. The
12bank shall be deemed to be acting in a fiduciary capacity with
13respect to these funds. A bank receiving funds in escrow
14pursuant to an escrow agreement executed on or after July 1,
151982 in connection with a loan as defined in section 535.8,
16subsection 1, shall may pay interest to the borrower on those
17funds, calculated on a daily basis, at the rate the bank pays
18to depositors of funds in ordinary savings accounts. A bank
19which maintains an escrow account in connection with any loan
20authorized by this section, whether or not the mortgage has
21been assigned to a third person, shall each year deliver to the
22mortgagor a written annual accounting of all transactions made
23with respect to the loan and escrow account.
243. Escrow reports. A state bank may act as an escrow agent
25with respect to real property, and may receive funds and make
26disbursements from escrowed funds in that capacity. The state
27bank shall be deemed to be acting in a fiduciary capacity with
28respect to these funds. A state bank which maintains such
29an escrow account relating to a mortgage, whether or not the
30mortgage has been assigned to a third person, shall deliver
31to the mortgagor a written summary of all transactions made
32with respect to the loan and escrow accounts during each
33calendar escrow account computation year as defined in 12
34C.F.R. §1024.17. However, the mortgagor and mortgagee may, by
35mutual agreement, select a fiscal year reporting period other
-54-1than the calendar year. The summary shall be delivered or
2mailed not later than thirty days following the escrow account
3computation year to which disclosure relates and shall include
4the information required for annual escrow account statements
5under 12 C.F.R. §1024.17. The summary shall contain all of the
6following information:
7a. The name and address of the mortgagee.
8b. The name and address of the mortgagor.
9c. A summary of escrow account activity during the year as
10follows:
11(1) The balance of the escrow account at the beginning of
12the year.
13(2) The aggregate amount of deposits to the escrow account
14during the year.
15(3) The aggregate amount of withdrawals from the escrow
16account for each of the following categories:
17(a) Payments against loan principal.
18(b) Payments against interest.
19(c) Payments against real estate taxes.
20(d) Payments for real property insurance premiums.
21(e) All other withdrawals.
22(4) The balance of the escrow account at the end of the
23year.
24d. A summary of loan principal for the year as follows:
25(1) The amount of principal outstanding at the beginning of
26the year.
27(2) The aggregate amount of payments against principal
28during the year.
29(3) The amount of principal outstanding at the end of the
30year.
31 Sec. 90. Section 524.910, subsection 2, Code 2021, is
32amended to read as follows:
332. Real property purchased by a state bank at sales upon
34foreclosure of mortgages or deeds of trust owned by it, or
35acquired upon judgments or decrees obtained or rendered for
-55-1debts due it, or real property conveyed to it in satisfaction
2of debts previously contracted in the course of its business,
3or real property obtained by it through redemption as a
4junior mortgagee or judgment creditor, shall be sold or
5otherwise disposed of by the state bank within five years
6after title is vested in the state bank, unless the time is
7extended by the superintendent. This deadline may be extended
8up to an additional five years with prior approval of the
9superintendent, but in no event shall a state bank hold such
10property for more than ten years.
11 Sec. 91. Section 524.1003, subsection 1, paragraph a, Code
122021, is amended to read as follows:
13a. If the superintendent at any time concludes that a state
14bank authorized to act in a fiduciary capacity is managing its
15accounts in an unsafe or unsound manner, or in a manner in
16conflict with the provisions of this chapter, and such state
17bank refuses to correct such practices upon following notice to
18do so, the superintendent may forthwith direct that the state
19bank cease to act as a fiduciary and proceed to resign its
20fiduciary positions.
21 Sec. 92. Section 524.1003, subsection 1, paragraph b, Code
222021, is amended by striking the paragraph and inserting in
23lieu thereof the following:
24b. After directing the state bank to cease to act as a
25fiduciary, the superintendent shall file a petition in the
26district court of Polk county setting forth in general terms
27that the state bank is acting as fiduciary with respect to
28certain property and that it is necessary and desirable that
29successor fiduciaries be appointed for such property.
30 Sec. 93. Section 524.1003, subsection 1, Code 2021, is
31amended by adding the following new paragraphs:
32 NEW PARAGRAPH. c. Following the filing of a petition
33pursuant to paragraph “b” by the superintendent, the district
34court shall issue an order requiring all persons interested
35in the state bank’s fiduciary accounts to appoint a successor
-56-1fiduciary by a specific date, acknowledge the fiduciary
2succession as described in the will, trust instrument, or
3other governing instrument of the fiduciary account, or show
4cause why the district court should not appoint a successor
5fiduciary. Such order may also appoint a temporary fiduciary
6for the fiduciary accounts held by the state bank who shall
7be obligated to take possession of the fiduciary accounts
8and perform necessary tax, investment, distribution, asset
9protection, and reporting obligations required of the fiduciary
10accounts and perform necessary tax, investment, distribution,
11asset protection, and reporting obligations required of the
12fiduciary until a permanent successor is appointed. Neither
13the temporary nor permanent successor fiduciary shall be
14liable for the actions of the state bank and shall not be
15responsible for reviewing the action or inaction of the
16preceding fiduciary. The state bank’s liability for any action
17or inaction in its former fiduciary positions shall not be
18impacted by the transfer of fiduciary duties pursuant to this
19section. The district court may assess the fees and costs of
20the temporary fiduciary against the state bank.
21 NEW PARAGRAPH. d. Following the appointment of a temporary
22fiduciary, the district court shall enter an order directing
23the temporary fiduciary to provide notice of the petition
24and the order described in this section, through a means
25approved by the district court, to all persons shown in the
26records of the state bank to have a beneficial interest in
27the fiduciary accounts or entitled to notice or an accounting
28under the terms of the will, trust instrument, or other
29governing instrument of the fiduciary account, chapter 633,
30633A, 633B, or other applicable statute under which the state
31bank has been operating as a fiduciary. The district court
32may also order publication of the notice for two consecutive
33weeks in newspapers of general circulation in one or more
34counties as prescribed by the district court, and publication
35on the temporary fiduciary’s internet site for at least twenty
-57-1days, to the extent the district court deems such published
2notice necessary to protect the interests of absent or remote
3beneficiaries.
4 Sec. 94. Section 524.1003, subsection 2, Code 2021, is
5amended by striking the subsection and inserting in lieu
6thereof the following:
72. At least twenty days after providing notice of a petition
8and order appointing the temporary fiduciary as described in
9this section, the district court shall appoint a permanent
10successor fiduciary for any fiduciary account where appropriate
11parties have failed to cause a successor fiduciary to be
12appointed. A successor fiduciary appointed in accordance with
13the terms of this section shall succeed to all the rights,
14powers, titles, duties, and responsibilities of the state bank
15except that the successor fiduciary shall not exercise the
16powers given in the instrument creating the powers that by
17its express terms are personal to the state bank previously
18designated and except claims or liabilities arising out of the
19management of the fiduciary account prior to the date of the
20transfer.
21 Sec. 95. Section 524.1004, Code 2021, is amended by striking
22the section and inserting in lieu thereof the following:
23524.1004 Voluntary relinquishment of fiduciary capacity.
241. A state bank desiring to completely surrender its
25authorization to act in any fiduciary capacity shall file with
26the superintendent a certified copy of a resolution by the
27board of directors signifying such intent.
282. Following the filing with the superintendent of the
29resolution to surrender its authorization to act in a fiduciary
30capacity, the state bank shall file a petition in the district
31court in which the state bank has its principal place of
32business setting forth in general terms that the state bank is
33acting as fiduciary with respect to certain property, that the
34state bank desires to cease its fiduciary function and resign
35its fiduciary positions, and that it is necessary and desirable
-58-1that successor fiduciaries be appointed for such property.
23. The filing of the petition shall operate as a resignation
3of the state bank from all of its fiduciary positions. During
4the adjudication of the petition, the state bank shall retain
5all fiduciary rights, powers, titles, duties, responsibilities,
6and accounts it held prior to filing the petition. The state
7bank’s liability for any action or inaction in its former
8fiduciary positions shall not be impacted by the transfer of
9fiduciary duties pursuant to this section.
104. Following the filing of the petition, the district
11court shall issue an order requiring all persons interested
12in such fiduciary accounts to appoint a successor fiduciary
13by a specific date, acknowledge the fiduciary succession as
14described in the will, trust instrument, or other governing
15instrument of the fiduciary account, or show cause why the
16district court should not appoint a successor fiduciary. The
17district court shall also enter an order directing the state
18bank to provide notice of the petition and the order described
19in this section, through a means approved by the district
20court, to all persons shown in the records of the state bank
21to have a beneficial interest in the fiduciary accounts or
22entitled to notice or an accounting under the terms of the
23will, trust instrument, or other governing instrument of the
24fiduciary account, chapter 633, 633A, 633B, or other applicable
25statute under which the state bank has been operating as a
26fiduciary. The district court may also order publication of
27the notice for two consecutive weeks in newspapers of general
28circulation in one or more counties as prescribed by the
29district court, and publication on the state bank’s internet
30site for at least twenty days, to the extent the district court
31deems such published notice necessary to protect the interests
32of absent or remote beneficiaries.
335. At least twenty days after the state bank provides notice
34of the petition and order as described in this section, the
35district court shall appoint a permanent successor fiduciary
-59-1for any fiduciary account where appropriate parties have
2failed to cause a successor fiduciary to be appointed. A
3successor fiduciary appointed in accordance with the terms of
4this section shall succeed to all the rights, powers, titles,
5duties, and responsibilities of the state bank except that the
6successor fiduciary shall not exercise powers given in the
7instrument creating the powers that by its express terms are
8personal to the state bank previously designated and except
9claims or liabilities arising out of the management of the
10fiduciary account prior to the date of the transfer.
116. Following the adjudication of the petition described
12in this section, the state bank shall proceed to amend its
13articles of incorporation, in accordance with the provisions
14of this chapter, in a manner to indicate that it is no longer
15authorized to act in a fiduciary capacity. The superintendent
16shall approve the proposed amendment, in the manner provided
17for in this chapter, if the superintendent is satisfied that
18the state bank has properly relieved itself of its fiduciary
19responsibilities.
20 Sec. 96. NEW SECTION. 524.1005A Nonresident corporate
21fiduciaries.
22An out-of-state bank or a trust company chartered or
23organized under the laws of another state may only act
24in a fiduciary capacity in this state if it satisfies the
25requirements for nonresident corporate fiduciaries pursuant to
26section 633.64.
27 Sec. 97. Section 524.1007, Code 2021, is amended by striking
28the section and inserting in lieu thereof the following:
29524.1007 Succession of fiduciary accounts to another
30financial institution.
311. A state bank or other entity authorized to act in
32a fiduciary capacity may enter into an agreement for the
33succession of any fiduciary accounts with one or more other
34banks or trust companies, including trust companies organized
35under the laws of another state, that are authorized to act in
-60-1a fiduciary capacity under the laws of this state, the laws
2of another state, or a national bank to the extent permitted
3by the laws of the United States. In the agreement, the
4succeeding bank or trust company may agree to succeed the
5relinquishing bank or trust company as a fiduciary to those
6fiduciary accounts which are designated in the agreement. The
7designation of accounts may be by general class or description
8and may include fiduciary accounts subject and not subject to
9court administration and fiduciary accounts to arise in the
10future under wills, trusts, court orders, or other documents
11under which the relinquishing bank or trust company is named
12as a fiduciary or is named to become a fiduciary upon the death
13of a testator or settlor or upon the happening of any other
14subsequent event.
152. The relinquishing bank or trust company shall provide,
16at least twenty days preceding the effective date for the
17succession of the fiduciary accounts, notice of the pending
18succession, as required by chapter 633, 633A, 633B, or any
19other applicable chapter, to all persons shown in the records
20of the relinquishing bank or trust company to have a beneficial
21interest in the fiduciary accounts or entitled to notice or an
22accounting under the terms of the will, trust instrument, or
23other governing instrument of the fiduciary account, chapter
24633, 633A, or 633B, or other applicable statute under which
25the relinquishing bank or trust company has been operating as
26a fiduciary. In order to account for unknown or prospective
27appointments, the relinquishing bank or trust company shall
28publish a notice of the succession to fiduciary accounts in a
29newspaper published in the county of the principal place of
30business of the relinquishing bank or trust company, and the
31notice must be published on the relinquishing bank or trust
32company’s internet site for at least twenty days preceding the
33effective date of the agreement for the succession of fiduciary
34accounts. For any fiduciary accounts that are employee benefit
35plans, the relinquishing bank or trust company may satisfy this
-61-1subsection by sending the required notice to the plan sponsors.
23. Following the publication and notice described in
3this section, the succeeding bank or trust company shall, on
4the effective date of the agreement for the succession of
5fiduciary accounts and without further notice, approval, or
6authorization, succeed to the relinquishing bank or trust
7company as to the fiduciary accounts and the fiduciary powers,
8rights, privileges, duties, and liabilities for the fiduciary
9accounts. On the effective date of the succession to fiduciary
10accounts, the relinquishing bank or trust company is released
11from the fiduciary duties under the fiduciary accounts and
12shall discontinue its exercise of fiduciary powers over the
13fiduciary accounts. Notice of such fiduciary succession
14shall be filed of record for each parcel of real estate in
15this state subject to such fiduciary succession unless all
16of the fiduciary accounts held by the relinquishing bank or
17trust company are subject to the agreement for succession
18of fiduciary accounts, in which case the relinquishing bank
19or trust company shall file notice of the succession in the
20county recorder’s office of all counties in which the fiduciary
21accounts of the relinquishing bank or trust company owned real
22estate prior to the effective date of the agreement. This
23subsection does not absolve a relinquishing bank or trust
24company from liabilities arising out of a breach of fiduciary
25duty occurring prior to the effective date of the succession
26to fiduciary accounts.
274. Within sixty days after the mailing and publication of
28the notice, a person with an interest in a fiduciary account
29included within the notice and agreement required by subsection
301 may apply to the district court in the county in which the
31notice is published for the appointment of a new fiduciary on
32the ground that the succeeding fiduciary will adversely affect
33the administration of the fiduciary account. After notice to
34all interested parties and a hearing on the issues, the court
35may appoint a new fiduciary to replace the succeeding fiduciary
-62-1if it finds that the substitution of the succeeding fiduciary
2will adversely affect the administration of the account and
3that the appointment of a new fiduciary would be in the best
4interests of the beneficiaries of the fiduciary account. This
5subsection is in addition to section 633.65 and any other
6applicable provision governing the removal of a fiduciary.
75. The privilege of succeeding to fiduciary accounts that
8is extended to a state bank or trust company by this section is
9also extended on the same terms and conditions to a national
10bank organized under 12 U.S.C. §21 et seq.to engage generally
11in the banking business, and to out-of-state banks and trust
12companies that are authorized to serve as a fiduciary in this
13state pursuant to section 633.64.
146. For a fiduciary account governed by Iowa law, a
15relinquishing bank or trust company may transfer the situs of
16the fiduciary account to a jurisdiction other than Iowa if the
17will, trust instrument, or other governing instrument of the
18fiduciary account so provides, if all persons interested in
19the fiduciary account consent to the transfer, or as otherwise
20authorized by applicable law.
21 Sec. 98. Section 524.1009, Code 2021, is amended to read as
22follows:
23524.1009 Succession to fiduciary accounts and appointments —
24application for appointment of new fiduciary merger.
251. If a party to a plan of merger was authorized to act in a
26fiduciary capacity and if the resulting state or national bank
27is similarly authorized, the resulting state or national bank
28shall be automatically substituted by reason of the merger as
29fiduciary of all accounts held in that capacity by such party
30to the plan of merger, without further action and without any
31order or decree of any court or public officer, and shall have
32all the rights and be subject to all the obligations of such
33party as fiduciary.
342. No designation, nomination, or appointment as fiduciary
35of a party to a plan of merger shall lapse by reason of the
-63-1merger. The resulting state or national bank, if authorized
2to act in a fiduciary capacity, shall be entitled to act
3as fiduciary pursuant to each designation, nomination, or
4appointment to the same extent as the party to the plan of
5merger so named could have acted in the absence of the merger.
62A. The relinquishing bank shall provide, at least twenty
7days preceding the effective date for the succession of
8the fiduciary accounts, notice of the pending succession,
9as required by chapter 633, 633A, 633B, or any other
10applicable chapter, to all persons shown in the records of
11the relinquishing bank to have a beneficial interest in the
12fiduciary accounts or entitled to notice or an accounting under
13the terms of the will, trust instrument, or other governing
14instrument of the fiduciary account, chapter 633, 633A, or
15633B, or other applicable statute under which the relinquishing
16bank has been operating as a fiduciary. In order to account
17for unknown or prospective appointments, the relinquishing bank
18shall publish a notice of the succession to fiduciary accounts
19in a newspaper published in the county of the principal place
20of business of the relinquishing bank, and the notice must be
21published on the relinquishing bank’s internet site for at
22least twenty days preceding the effective date of the merger.
23For any fiduciary accounts that are employee benefit plans, the
24relinquishing bank may satisfy this subsection by sending the
25required notice to the plan sponsors.
263. Any person with an interest in an account held in a
27fiduciary capacity by a party to a plan of merger may, within
28sixty days after the effective date of the merger the mailing
29and publication of the notice, apply to the district court in
30the county in which the resulting state or national bank has
31its principal place of business, notice is published for the
32appointment of a new fiduciary to replace the resulting state
33or national bank on the ground that the merger will adversely
34affect the administration of the fiduciary account. The court
35shall have the discretion to appoint a new fiduciary to replace
-64-1the resulting state or national bank if it should find, upon
2hearing after notice to all interested parties, that the merger
3will adversely affect the administration of the fiduciary
4account and that the appointment of a new fiduciary will be
5in the best interests of the beneficiaries of the fiduciary
6account. This provision is in addition to any other provision
7of law governing the removal of fiduciaries and is subject to
8the terms upon which the party to the plan of merger which held
9the fiduciary account was designated as fiduciary.
104. The resulting bank shall record a copy of the articles
11of merger in the county recorder’s office of all counties in
12which the fiduciary accounts of the relinquishing bank owned
13real estate prior to the effective date of the merger.
14 Sec. 99. Section 524.1106, Code 2021, is amended to read as
15follows:
16524.1106 Fees paid to an affiliate — approval by
17superintendent.
18Any contract or arrangement for management or financial
19services which involves payment for these services by a state
20bank to a person who owns shares in that state bank, or to any
21other affiliate, must be approved by the superintendent prior
22to such contract or arrangement becoming binding upon the state
23bank made in compliance with 12 U.S.C. §371c and 12 U.S.C.
24§371c-1, and may also be reviewed by the superintendent at any
25time after original approval. Any contract or arrangement for
26consultation or other services which involve payment of those
27services by a state bank to any person who individually or
28whose spouse or immediate family or any combination thereof
29owns fifteen percent or more of the outstanding shares of
30that state bank or is an officer or director thereof, or to
31an affiliate may be reviewed by the superintendent. Fees
32paid to an affiliate must be substantially the same as those
33prevailing at the time for comparable transactions involving
34nonaffiliated companies in accordance with the provisions of
3512 U.S.C. §371c-1. The superintendent shall have authority to
-65-1determine whether or not such fees are reasonable in relation
2to the services performed, and if the superintendent determines
3they are unreasonable, to require that they be reduced to a
4reasonable amount or eliminated and the excess refunded, or
5that such contract or arrangement not be entered into by the
6state bank.
7 Sec. 100. Section 524.1201, Code 2021, is amended to read
8as follows:
9524.1201 General provisions.
101. A state bank may establish and operate any number of bank
11offices at any location in this state subject to the approval
12and regulation of the superintendent. The superintendent
13shall supervise and regulate all out-of-state branches and
14offices of a state bank. A bank office may furnish all banking
15services ordinarily furnished to customers and depositors
16at the principal place of business of the state bank which
17operates the office, and a bank office manager or an officer
18of the bank shall be physically present at each bank office
19during a majority of its business hours. The central executive
20and official business and principal recordkeeping functions of
21a state bank shall be exercised only at its principal place
22of business or at another bank office as authorized by the
23superintendent for these functions.
242. Notwithstanding subsection 1, data Data processing
25services referred to in section 524.804 may be performed for
26the state bank at some other secure location. All transactions
27of a bank office shall be immediately transmitted to the
28principal place of business or other bank office authorized
29under subsection 1 of the state bank which operates the office,
30and no current recordkeeping functions shall be maintained
31at a bank office other than the bank office authorized under
32subsection 1, except to the extent the state bank which
33operates the office deems it desirable to keep there duplicates
34of the records kept at the principal place of business or
35authorized bank office of the state bank.
-66- 13. Notwithstanding any of the other provisions of this
2section, original loan documentation and trust recordkeeping
3functions may be located at any authorized bank office or at
4any other secure location approved by the superintendent.
5 Sec. 101. Section 524.1206, Code 2021, is amended to read
6as follows:
7524.1206 Identification of legally chartered name of bank —
8required use of name.
9A state or national bank, at its locations in this state,
10shall identify its principal place of business, any bank
11office, or any bank branch in a manner which includes its
12legally chartered name or a reasonable variation of such name.
13A bank doing business in this state electronically shall
14identify its legally chartered name in any online, mobile, or
15digital customer interface. The legally chartered name of the
16state bank, out-of-state bank, or national bank shall be used
17in all legal documents of such bank.
18 Sec. 102. Section 524.1301, unnumbered paragraph 1, Code
192021, is amended to read as follows:
20A majority of the incorporators, organizers, or initial
21directors of a state bank that has not issued shares or has not
22commenced business may dissolve the state bank by delivering
23articles of dissolution to the superintendent, together with
24the applicable filing and recording fees, for filing with the
25secretary of state that set forth all of the following:
26 Sec. 103. Section 524.1303, subsection 2, Code 2021, is
27amended to read as follows:
282. Upon acceptance for processing of an application for
29approval of a plan of dissolution on forms prescribed by
30the superintendent, the superintendent shall conduct such
31investigation as the superintendent may deem necessary to
32determine whether the plan of dissolution adequately protects
33the interests of depositors, other creditors, and shareholders
34and, if the plan of dissolution involves an acquisition of
35assets and assumption of liabilities by another state bank,
-67-1whether such acquisition and assumption would be consistent
2with adequate and sound banking and in the public interest, on
3the basis of factors substantially similar to those set forth
4in section 524.1403, subsection 1, paragraph “d”.
5 Sec. 104. Section 524.1303, subsections 3, 4, 5, and 6, Code
62021, are amended by striking the subsections.
7 Sec. 105. Section 524.1304, subsection 2, Code 2021, is
8amended to read as follows:
92. Upon approval of the plan of voluntary dissolution by
10the superintendent, the superintendent shall file with the
11secretary of state articles of dissolution prepared by the
12applicant in conformance with section 524.1304A. Upon filing
13of the articles of dissolution with the secretary of state,
14the state bank shall cease to accept deposits or carry on its
15business, except insofar as may be necessary for the proper
16winding up of the business of the state bank in accordance
17with the approved plan of dissolution. Upon request, the
18superintendent shall expressly revoke the authorization to
19do business of any state bank that has voluntarily dissolved
20pursuant to this section and shall return the physical copy
21of such state bank’s authorization to do business in a manner
22clearly indicating that the authorization has been revoked.
23 Sec. 106. Section 524.1305, subsection 1, paragraph d, Code
242021, is amended to read as follows:
25d. Distributing Making distributions of its remaining
26property assets among its shareholders according to their
27interests.
28 Sec. 107. Section 524.1305, subsection 2, paragraph d, Code
292021, is amended to read as follows:
30d. Changing quorum any of the following:
31(1) Quorumor voting requirements for its board of directors
32or shareholders; changing provisions.
33(2) Provisionsfor selection, resignation, or removal of
34its directors or officers or both; or changing provisions.
35(3) Provisionsfor amending its bylaws.
-68-1 Sec. 108. Section 524.1305, subsection 3, paragraphs a, b,
2and d, Code 2021, are amended to read as follows:
3a. By mail to each depositor and creditor, except those as
4to whom the liability of the state bank has been assumed by
5another financial institution insured by the federal deposit
6insurance corporation pursuant to the plan of dissolution, at
7their last address of record as shown upon the books of the
8state bank, including a statement of the amount shown by the
9books of the state bank to be due to such depositor or creditor
10and a demand that any claim for a greater amount be filed with
11the state bank any time before a specified date at least ninety
12days after the date of the notice.
13b. By mail to each lessee of a safe-deposit box and each
14customer for whom property is held in safekeeping, except those
15as to whom the liability of the state bank has been assumed by
16another financial institution insured by the federal deposit
17insurance corporation pursuant to the plan of dissolution,
18at their last address of record as shown upon the books of
19the state bank, including a demand that all property held in
20a safe-deposit box or held in safekeeping by the state bank
21be withdrawn by the person entitled to the property before a
22specified date which is at least ninety days after the date of
23the notice.
24d. By a conspicuous posting at each office of the state
25bank and by posting on the state bank’s internet site for
26at least thirty days following the filing of the articles of
27dissolution.
28 Sec. 109. Section 524.1306, subsection 2, Code 2021, is
29amended to read as follows:
302. The statement of revocation of voluntary dissolution
31proceedings, whether by consent of shareholders or by act of
32the state bank, shall be delivered to the superintendent,
33together with the applicable filing and recording fee, who
34shall, if the superintendent finds that they satisfy the
35requirements of this section, deliver them to the secretary
-69-1of state for filing and recording in the secretary of state’s
2office, and the same shall be filed and recorded in the office
3of the county recorder.
4 Sec. 110. Section 524.1308A, Code 2021, is amended by adding
5the following new subsection:
6 NEW SUBSECTION. 5. As used in this section, the term
7“notice” means as defined in section 490.141.
8 Sec. 111. Section 524.1308B, subsection 2, unnumbered
9paragraph 1, Code 2021, is amended to read as follows:
10A The notice made pursuant to this section must satisfy all
11of the following requirements:
12 Sec. 112. Section 524.1308B, subsection 2, paragraph a,
13Code 2021, is amended to read as follows:
14a. Be published at least once in accordance with all of the
15following:
16(1) One timein a newspaper of general circulation in the
17county where the dissolved state bank’s principal office is or
18was located.
19(2) Be posted conspicuously for at least thirty days on the
20dissolved state bank’s internet site.
21 Sec. 113. Section 524.1309, Code 2021, is amended to read
22as follows:
23524.1309 Becoming subject to chapter 489 or 490.
24In lieu of the dissolution procedure prescribed in sections
25524.1303 through 524.1306, a state bank may cease to carry
26on the business of banking and, after compliance with this
27section, continue as a corporation subject to chapter 490; or
28if the state bank is organized as a limited liability company
29under this chapter, continue as a limited liability company
30subject to chapter 489.
311. A state bank that has commenced business may propose
32to voluntarily cease to carry on the business of banking and
33become a corporation subject to chapter 490, or a limited
34liability company subject to chapter 489, upon the affirmative
35vote of the holders of at least a majority of the shares
-70-1entitled to vote on such proposal, adopting a plan involving
2both a provision for acquisition of its assets and assumption
3of its liabilities by another state bank, national bank, or
4other financial institution insured by the federal deposit
5insurance corporation, and a provision for continuance of
6its business if acquisition of its assets and assumption of
7its liabilities is not effected, or any other plan providing
8for the cessation of banking business and the payment of its
9liabilities.
102. The application to the superintendent for approval
11of a plan described in subsection 1 shall be treated by
12the superintendent in the same manner as an application for
13approval of a plan of dissolution under section 524.1303,
14subsection 2, and shall be subject to section 524.1303,
15subsection 3 524.1305, subsections 8 and 9.
163. Immediately upon adoption and approval of a plan to
17voluntarily cease to carry on the business of banking and
18become a corporation subject to chapter 490, or a limited
19liability company subject to chapter 489 the state bank
20shall submit an application for the required approval by the
21superintendent in the manner prescribed by the superintendent.
22As part of this application, the state bank shall deliver to
23the superintendent a plan to cease the business of banking
24and become a corporation subject to chapter 490, or a limited
25liability company subject to chapter 489, which shall be
26signed by two of its duly authorized officers and shall
27contain the name of the state bank, the post office address
28of its principal place of business, the name and address of
29its officers and directors, the number of shares entitled
30to vote on the plan and the number of shares voted for or
31against the plan, respectively, the nature of the business
32to be conducted by the corporation under chapter 490, or by
33the limited liability company subject to chapter 489, and the
34general nature of the assets to be held by the corporation or
35company. As part of the application, the state bank shall
-71-1also deliver to the superintendent articles of intent to be
2subject to chapter 490, together with the applicable filing
3fees, which shall set forth that the state bank has complied
4with this section, that it intends to cease to carry on the
5business of banking, and the information required by section
6490.202 relative to the contents of articles of incorporation
7under chapter 490.
84. Upon approval of the plan by the superintendent, the
9state bank shall immediately surrender to the superintendent
10its authorization to do business as a bank and shall cease
11to accept deposits and carry on the banking business except
12insofar as may be necessary for it to complete the settlement
13of its affairs as a state bank in accordance with subsection
145. Upon request, the superintendent shall expressly revoke
15the state bank’s authorization to do business and return the
16physical copy of such state bank’s authorization to do business
17in a manner clearly indicating that the authorization has been
18revoked.
195. The board of directors has full power to complete the
20settlement of the affairs of the state bank. Within thirty
21days after approval by the superintendent of the plan to cease
22the business of banking and become a corporation subject
23to chapter 490, or a limited liability company subject to
24chapter 489, the state bank shall give notice of its intent
25to persons identified in section 524.1305, subsection 3, in
26the manner provided for in that subsection. In completing
27the settlement of its affairs as a state bank, the state bank
28shall also follow the procedure prescribed in section 524.1305,
29subsections 4, 5, and 6.
306. Upon completion of all the requirements of this section,
31the state bank shall deliver to the superintendent articles of
32intent to be subject to chapter 490 or 489, together with the
33applicable filing and recording fees, which shall set forth
34that the state bank has complied with this section, that it has
35ceased to carry on the business of banking, and the information
-72-1required by section 490.202 relative to the contents of
2articles of incorporation under chapter 490, or articles of
3organization under chapter 489. If the superintendent finds
4that the state bank has complied with all requirements of
5 this section and that the articles of intent to be subject to
6chapter 490 or 489 satisfy the requirements of this section,
7the superintendent shall deliver them to the secretary of state
8for filing and recording in the secretary of state’s office,
9and the superintendent shall file and record them in the office
10of the county recorder.
117. Upon the filing of the articles of intent to be subject
12to chapter 490 or 489, the state bank shall immediately
13 cease to be a state bank subject to this chapter, and shall
14immediately cease to have the powers of a state bank subject
15to this chapter and shall become a corporation subject to
16chapter 490 or a limited liability company subject to chapter
17489. The secretary of state shall issue a certificate as to
18the filing of the articles of intent to be subject to chapter
19490 or 489 and send the certificate to the corporation or
20limited liability company or its representative. The articles
21of intent to be subject to chapter 490 or 489 shall be the
22articles of incorporation of the corporation or a limited
23liability company. The provisions of chapter 490 or 489
24 becoming applicable to a corporation or limited liability
25company formerly doing business as a state bank shall not
26affect any right accrued or established, or liability or
27penalty incurred under this chapter prior to the filing with
28the secretary of state of the articles of intent to be subject
29to chapter 490 or 489.
308. A shareholder of a state bank who objects to adoption
31by the state bank of a plan to cease to carry on the business
32of banking and to continue as a corporation subject to chapter
33490, or a limited liability company subject to chapter 489,
34 is entitled to appraisal rights provided for in chapter 490,
35subchapter XIII, or in chapter 489, section 489.604.
-73- 19. A state bank, at any time prior to the approval of the
2articles of intent to become subject to chapter 490 or 489,
3may revoke the proceedings in the manner prescribed by section
4524.1306.
5 Sec. 114. Section 524.1310, subsection 1, paragraph a, Code
62021, is amended to read as follows:
7a. In a situation in which the superintendent has required,
8in accordance with section 524.226 524.224, that the state
9bank cease to carry on its business, the superintendent shall
10immediately tender to the federal deposit insurance corporation
11the receivership for the state bank. The affairs of the state
12bank shall thereafter be governed by this section, section
13524.1311, and the provisions of federal law, and shall be
14subject to federal court jurisdiction, and the assets of the
15state bank shall be distributed in accordance with section
16524.1312. If there is a conflict between the provisions of
17state and federal law, federal law shall govern.
18 Sec. 115. Section 524.1311, subsection 2, Code 2021, is
19amended to read as follows:
202. After the involuntary dissolution of a state bank, the
21superintendent shall file notice of the dissolution with the
22secretary of state and the county recorder of the county in
23which the state bank is located. No fee shall be charged by
24the secretary of state or the county recorder for the filing
25or recording. The corporate existence of the state bank
26shall cease upon filing of the notice of dissolution with the
27secretary of state.
28 Sec. 116. Section 524.1401, Code 2021, is amended to read
29as follows:
30524.1401 Authority to merge.
311. Upon compliance with the requirements of this chapter,
32one or more state banks, one or more out-of-state banks, one or
33more national banks, one or more federal savings associations,
34one or more corporations, or any combination of these entities,
35with the approval of the superintendent, may merge into a state
-74-1bank pursuant to a plan of merger.
22. Upon compliance with the requirements of this chapter,
3one or more state banks may merge into a national bank, federal
4savings association, or out-of-state bank. The authority of
5a state bank to merge into a national bank or federal savings
6association is subject to the condition that at the time of the
7transaction the laws of the United States shall authorize a
8national bank or federal savings association located in this
9state, without approval by the comptroller of the currency of
10the United States, to merge into a state bank under limitations
11no more restrictive than those contained in this chapter with
12respect to the merger of a state bank into a national bank or
13federal savings association. The authority of a state bank to
14merge into an out-of-state bank is subject to the condition
15that at the time of the transaction the laws of the home state
16of the resulting bank shall authorize a bank organized under
17the laws of such home state, without approval by the home
18state’s bank regulatory authority, to merge into a state bank
19under limitations no more restrictive than those contained in
20this chapter with respect to the merger of a state bank into an
21out-of-state bank.
223. Upon compliance with the requirements of this chapter,
23one or more state banks may merge with one or more federal
24associations. The authority of a state bank to merge into a
25federal association is subject to the conditions the laws of
26the United States authorize at the time of the transaction.
274. 3. As used in this section, the term “merger” or “merge”
28means any plan by which the assets and liabilities of an
29entity are combined with those of one or more other entities,
30including transactions in which one of the corporate entities
31survives and transactions in which a new corporate entity is
32created.
33 Sec. 117. Section 524.1402, Code 2021, is amended to read
34as follows:
35524.1402 Requirements for a merger.
-75- 1The requirements for a merger which must be satisfied by the
2parties to the merger are as follows:
31. The parties shall adopt a plan stating of merger which
4must include all of the following:
5a. The names of the parties proposing to merge and the name
6of the bank into which they propose to merge, which is the
7“resulting bank”.
8a. As to each party to the merger, the party’s name,
9jurisdiction of formation, and type of entity.
10b. The resulting bank’s name, jurisdiction of formation, and
11type of entity, and, if the resulting bank is to be created in
12the merger, a statement to that effect.
13b. c. The terms and conditions of the proposed merger.
14c. d. The manner and basis of converting the shares of each
15party into any combination of shares, obligations, or other
16securities of the resulting bank or of any other corporation,
17or, in whole or in part, into cash or other property,
18obligations, rights to acquire shares or other securities,
19cash, or other property.
20d. e. The rights of the shareholders of each of the
21parties.
22e. f. An agreement concerning the merger.
23f. g. Such other provisions with respect to the proposed
24merger which are deemed necessary or desirable.
252. In the case of a state bank which is a party to the
26plan of merger, if the proposed merger will result in a state
27bank subject to this chapter, adoption of the plan of merger
28 by such state bank requires the affirmative vote of at least
29a majority of the directors and approval by the shareholders,
30in the manner and according to the procedures prescribed in
31section 490.1104, at a meeting called in accordance with
32the terms of that section. In the case of a national bank,
33or if the proposed merger will result in a national bank,
34adoption of the plan of merger by each party to the merger
35shall require the affirmative vote of at least such directors
-76-1and shareholders whose affirmative vote on the plan of merger
2 is required under the laws of the United States. Subject to
3applicable requirements of the laws of the United States in a
4case in which a national bank is a party to a plan of merger,
5any modification of a plan of merger which has been adopted
6shall be made by any method provided in the plan of merger, or
7in the absence of such provision, by the same vote as required
8for adoption.
93. If a proposed merger will result in a state bank,
10application for the required approval by the superintendent
11shall be made in the manner prescribed by the superintendent.
12There shall also be delivered to the superintendent, when
13available, the following:
14a. Articles of merger.
15b. Applicable fees payable to the secretary of state, as
16specified in section 490.122, for the filing and recording of
17the articles of merger.
18c. If there is any modification of the plan of merger at
19any time prior to the approval by the superintendent under
20section 524.1403, an amendment of the application and, if
21necessary, of the articles of merger, signed in the same manner
22as the originals, setting forth the modification of the plan of
23merger, the method by which the modification was adopted and
24any related change in the provisions of the articles of merger.
25d. Proof of publication of the notice required by subsection
264.
274. If a proposed merger will result in a state bank, within
28thirty days after the application for merger is accepted for
29processing, the parties to the plan shall publish a notice of
30the proposed transaction in a newspaper of general circulation
31published in the municipal corporation or unincorporated
32area in which each party to the plan has its principal place
33of business, or if there is none, in a newspaper of general
34circulation published in the county, or in a county adjoining
35the county, in which each party to the plan has its principal
-77-1place of business. The notice shall be on forms prescribed by
2the superintendent and shall set forth the names of the parties
3to the plan and the resulting state bank, the location and
4post office address of the principal place of business of the
5resulting state bank and of each office to be maintained by
6the resulting state bank, and the purpose or purposes of the
7resulting state bank. Proof of publication of the notice shall
8be delivered to the superintendent within fourteen days.
95. Within thirty days after the date of the publication of
10the notice required under subsection 4, any interested person
11may submit to the superintendent written comments and data
12on the application. Comments challenging the legality of an
13application shall be submitted separately in writing. The
14superintendent may extend the thirty-day comment period if, in
15the superintendent’s judgment, extenuating circumstances exist.
166. Within thirty days after the date of the publication
17of the notice required under subsection 4, any interested
18person may submit to the superintendent a written request for a
19hearing on the application. The request shall state the nature
20of the issues or facts to be presented and the reasons why
21written submissions would be insufficient to make an adequate
22presentation to the superintendent. If the reasons are related
23to factual disputes, the disputes shall be described. Written
24requests for hearings shall be evaluated by the superintendent,
25who may grant or deny such requests in whole or in part. A
26hearing request shall generally be granted only if it is
27determined that written submissions would be inadequate or that
28a hearing would otherwise be beneficial to the decision-making
29process. A hearing may be limited to issues considered
30material by the superintendent.
317. If a request for a hearing is denied, the superintendent
32shall notify the applicant and all interested persons and
33shall state the reasons for the denial. Interested persons
34may submit to the superintendent, with simultaneous copies
35to the applicant, additional written comments or data on the
-78-1application within fourteen days after the date of the notice
2of denial. The applicant shall be provided an additional seven
3days, after the fourteen-day deadline has expired, within which
4to respond to any comments submitted within the fourteen-day
5period. The superintendent may waive this seven-day period
6upon request by the applicant. A copy of any response
7submitted by the applicant shall also be mailed simultaneously
8by the applicant to the interested persons.
98. 4. The articles of merger shall be signed by two a duly
10authorized officers officer of each party to the plan of merger
11 and shall contain all of the following:
12a. The names name, jurisdiction of formation, and type
13of entity of the parties each party to the plan, and of the
14resulting state bank of merger.
15b. The name, jurisdiction of formation, and type of entity
16of the resulting state bank.
17b. c. The location and the post office address of the
18principal place of business of each party to the plan of
19merger, and of each additional office maintained by the parties
20to the plan of merger, and the location and post office address
21of the principal place of business of the resulting state bank,
22and of each additional office to be maintained by the resulting
23state bank.
24c. d. The votes by which the plan of merger was adopted,
25and the date and place of each meeting in connection with such
26adoption.
27d. e. The number of directors constituting the board of
28directors, and the names and addresses of the individuals who
29are to serve as directors until the next annual meeting of the
30shareholders or until their successors be elected and qualify.
31e. f. Any amendment of the articles of incorporation of the
32resulting state bank.
33f. The plan of merger.
349. 5. If a proposed merger will result in a national bank,
35federal savings association, or out-of-state bank, a state bank
-79-1which is a party to the plan of merger shall do all of the
2following:
3a. Notify the superintendent of the proposed merger.
4b. Provide such evidence of the adoption of the plan of
5merger as the superintendent may request.
6c. Notify the superintendent of any abandonment or
7disapproval of the plan of merger.
8d. File with the superintendent and with the secretary of
9state evidence of approval of the merger by the comptroller
10of the currency of the United States if the merger results
11in a national bank or federal savings association, or the
12approval of the merger by the home state chartering authority
13of the resulting out-of-state bank if the merger results in an
14out-of-state bank.
15e. Notify the superintendent of the date upon which the
16merger is to become effective.
17 Sec. 118. Section 524.1403, Code 2021, is amended to read
18as follows:
19524.1403 Approval of merger by superintendent.
201. Upon receipt of an application for approval of a
21merger and of the supporting items required by section
22524.1402, subsection 3, the superintendent shall conduct
23such investigation as the superintendent deems necessary to
24ascertain the following:
25a. The articles of merger and supporting items satisfy the
26requirements of this chapter.
27b. The plan of merger and any modification of the plan of
28merger adequately protects the interests of depositors, other
29creditors and shareholders.
30c. The requirements for a merger under all applicable laws
31have been satisfied and the resulting state bank would satisfy
32the requirements of this chapter with respect to it.
33d. The merger would be consistent with adequate and
34sound banking and in the public interest on the basis of
35the financial history and condition of the parties to the
-80-1plan, including the adequacy of the capital structure of
2the resulting state bank, the character of the management
3of the resulting state bank, the potential effect of the
4merger on competition, and the convenience and needs of the
5area primarily to be served by the resulting state bank,
6particularly the resulting state bank’s plans to accept
7deposits from, lend money in, and process payments in the area
8primarily to be served by the resulting state bank.
92. a. Within one hundred eighty days after acceptance of
10the application for processing, or within an additional period
11of not more than sixty days after receipt of an amendment of
12the application, the superintendent shall approve or disapprove
13the application on the basis of the investigation. The plan of
14merger shall not be modified at any time after approval of the
15application by the superintendent.
16b. If the superintendent finds that the superintendent
17must act immediately on the pending application in order to
18protect the interests of depositors or the assets of any
19party to the plan, the superintendent may proceed without
20requiring publication of the notice required under section
21524.1402, subsection 4. As a condition of receiving the
22decision of the superintendent with respect to the pending
23application, the parties to the plan of merger shall reimburse
24the superintendent for all the expenses incurred in connection
25with the application. The superintendent shall give to the
26parties to the plan of merger written notice of the decision
27and, in the event of disapproval, a statement of the reasons
28for the decision. The decision of the superintendent shall be
29subject to judicial review pursuant to chapter 17A.
30 Sec. 119. Section 524.1404, Code 2021, is amended to read
31as follows:
32524.1404 Procedure after approval by the superintendent —
33issuance of certificate of merger.
34If applicable state or federal laws require the approval of
35the merger by a federal or state agency, the superintendent may
-81-1withhold delivery of the approved articles of merger until the
2superintendent receives notice of the decision of such agency.
3If the final approval of the agency is not given within six
4months of the superintendent’s approval, the superintendent
5shall notify the parties to the plan of merger that the
6approval of the superintendent has been rescinded for that
7reason. If such agency gives its approval, the superintendent
8shall deliver the articles of merger, with the superintendent’s
9approval indicated on the articles, to the secretary of state,
10and shall notify the parties to the plan of merger. The
11receipt of the approved articles of merger by the secretary of
12state constitutes filing of the articles of merger with that
13office. The secretary of state shall record the articles of
14merger, and the articles shall be filed and recorded in the
15office of the county recorder in each county in which the
16parties to the plan had previously maintained a principal place
17of business. On the date upon which the merger is effective
18the secretary of state shall issue a certificate of merger and
19send the same to the resulting state bank and a copy of the
20certificate of merger to the superintendent.
21 Sec. 120. Section 524.1405, subsection 2, Code 2021, is
22amended by striking the subsection and inserting in lieu
23thereof the following:
242. When a merger takes effect, all of the following apply:
25a. Every other financial institution to the merger merges
26into the surviving financial institution and the separate
27existence of every party except the surviving financial
28institution ceases.
29b. All property owned by, and every contract right possessed
30by, each financial institution or other authorized entity that
31is a party to the merger, other than the resulting bank, are
32the property and contract rights of the resulting bank without
33transfer, reversion, or impairment.
34c. All debts, obligations, and other liabilities of each
35financial institution or other authorized entity that is a
-82-1party to the merger, other than the resulting bank, are debts,
2obligations, or liabilities of the resulting bank.
3d. The name of the survivor may, but need not be,
4substituted in any pending proceeding for the name of any party
5to the merger whose separate existence ceased in the merger.
6e. For a resulting state bank, the articles of incorporation
7of the resulting state bank are amended to the extent provided
8in the articles of merger.
9f. The articles of incorporation of a resulting state bank
10that is created by the merger become effective.
11g. The shares of each financial institution or authorized
12entity that is a party to the merger, that are to be converted
13in accordance with the terms of the merger into any combination
14of shares or other securities, obligations, rights to acquire
15shares or other securities, cash, or other property, are
16converted, and the former holders of such shares are entitled
17only to the rights provided in the articles of merger or to
18their rights under section 524.1406.
19h. Except as provided by law or the terms of the merger,
20all the rights, privileges, franchises, and immunities of each
21financial institution or other authorized entity that is a
22party to the merger, other than the resulting bank, are the
23rights, privileges, franchises, and immunities of the resulting
24bank.
25 Sec. 121. Section 524.1405, Code 2021, is amended by adding
26the following new subsection:
27 NEW SUBSECTION. 3. Upon request, the superintendent shall
28expressly revoke the authorization to do business of any state
29bank that is a party to the merger, other than the resulting
30state bank, and shall return the physical copy of such state
31bank’s authorization to do business in a manner clearly
32indicating that the authorization has been revoked.
33 Sec. 122. Section 524.1406, Code 2021, is amended to read
34as follows:
35524.1406 Appraisal rights of shareholders.
-83- 11. A shareholder of a state bank, which is a party to a
2proposed merger plan of merger which will result in a state
3bank subject to this chapter, who objects to the plan of merger
4 is entitled to appraisal rights as provided in chapter 490,
5subchapter XIII.
62. If a shareholder of a national bank which is a party to
7a proposed merger plan of merger which will result in a state
8bank, or a shareholder of a state bank which is a party to a
9plan of merger which will result in a national bank, objects to
10the plan of merger and complies with the requirements of the
11applicable laws of the United States, the resulting state bank
12or national bank, as the case may be, is liable for the value of
13the shareholder’s shares as determined in accordance with such
14laws of the United States.
15 Sec. 123. Section 524.1408, Code 2021, is amended to read
16as follows:
17524.1408 Merger of corporation or limited liability company
18substantially owned by a state bank.
19A state bank owning at least ninety percent of the
20outstanding shares, of each class, of another corporation
21or limited liability company which it is authorized to own
22under this chapter may merge the other corporation or limited
23liability company into itself without approval by a vote of
24the shareholders of either the state bank or the subsidiary
25corporation or limited liability company. The board of
26directors of the state bank shall approve a plan of merger,
27mail the plan of merger to shareholders of record of the
28subsidiary corporation or holders of membership interests in
29the subsidiary limited liability company, and prepare and
30execute articles of merger in the manner provided for in
31section 490.1105. The articles of merger, together with the
32applicable filing and recording fees, shall be delivered to
33the superintendent who shall, if the superintendent approves
34of the proposed merger and if the superintendent finds the
35articles of merger satisfy the requirements of this section,
-84-1deliver them to the secretary of state for filing and recording
2 in the secretary of state’s office, and they shall be filed
3in the office of the county recorder. The secretary of state
4upon filing the articles of merger shall issue a certificate of
5merger and send the certificate to the state bank and a copy of
6it to the superintendent.
7 Sec. 124. Section 524.1409, Code 2021, is amended to read
8as follows:
9524.1409 Conversion of national bank, or federal savings
10association, out-of-state bank, or state or federally chartered
11credit union into state bank.
12A national bank or federal savings association, an
13out-of-state bank, or a state or federally chartered credit
14union may, subject to the provisions of this chapter, may
15 convert into a state bank upon authorization by and compliance
16with the laws of the United States, adoption of a plan of
17conversion by the affirmative vote of at least a majority
18of its directors and the holders of two-thirds of each
19class of its shares at a meeting held upon not less than ten
20days’ notice to all shareholders, and upon approval of the
21superintendent.
22 Sec. 125. Section 524.1410, Code 2021, is amended to read
23as follows:
24524.1410 Application for approval by superintendent.
25A national bank or federal savings association, out-of-state
26bank, or a state or federally chartered credit union shall
27make an application to the superintendent for approval of the
28conversion in a manner prescribed by the superintendent and
29shall deliver to the superintendent, when available:
301. Articles of conversion.
312. As soon as available, proof of publication of the notice
32required by section 524.1412.
333. 2. The applicable fee payable to the secretary of state,
34under section 490.122, for the filing and recording of the
35articles of conversion.
-85-1 Sec. 126. Section 524.1411, unnumbered paragraph 1, Code
22021, is amended to read as follows:
3The articles of conversion shall be signed by two duly
4authorized officers of the national bank or federal savings
5association, out-of-state bank, or state or federally chartered
6credit union, and shall contain all of the following:
7 Sec. 127. Section 524.1411, subsection 1, Code 2021, is
8amended to read as follows:
91. The name of the national bank or federal savings
10association, out-of-state bank, or state or federally chartered
11credit union, and the name of the resulting state bank.
12 Sec. 128. Section 524.1413, subsection 2, Code 2021, is
13amended to read as follows:
142. Within ninety days after the application has been
15accepted for processing, the superintendent shall approve or
16disapprove the application on the basis of the investigation.
17As a condition of receiving the decision of the superintendent
18with respect to the application, the national bank or federal
19savings association, out-of-state bank, or state or federally
20chartered credit union shall reimburse the superintendent for
21all expenses incurred in connection with the application.
22The superintendent shall give the national bank or federal
23savings association, out-of-state bank, or state or federally
24chartered credit union written notice of the decision and, in
25the event of disapproval, a statement of the reasons for the
26decision. If the superintendent approves the application,
27the superintendent shall deliver the articles of conversion,
28with the superintendent’s approval indicated on the articles
29of conversion, to the secretary of state. The decision
30of the superintendent shall be subject to judicial review
31pursuant to chapter 17A. Notwithstanding the terms of the
32Iowa administrative procedure Act, chapter 17A, a petition for
33judicial review must be filed within thirty days after the
34superintendent notifies the national bank or federal savings
35association of the superintendent’s decision.
-86-1 Sec. 129. Section 524.1414, Code 2021, is amended to read
2as follows:
3524.1414 Receipt by secretary of state — county recorder.
4The receipt of the approved articles of conversion by
5the secretary of state constitutes filing of the articles of
6conversion with that office. The secretary of state shall
7record the articles of conversion and the articles shall be
8filed and recorded in the office of the county recorder in the
9county in which the resulting state bank has its principal
10place of business.
11 Sec. 130. Section 524.1415, Code 2021, is amended to read
12as follows:
13524.1415 Effect of filing of articles of conversion with
14secretary of state.
151. The conversion is effective upon the filing of the
16articles of conversion with the secretary of state, or at any
17later date and time as specified in the articles of conversion.
18The acknowledgment of filing is conclusive evidence of the
19performance of all conditions required by this chapter for
20conversion of a national bank or federal savings association,
21out-of-state bank, or state or federally chartered credit union
22 into a state bank, except as against the state.
232. When a conversion becomes effective, the existence of
24the national bank or federal savings association, out-of-state
25bank, or state or federally chartered credit union shall
26continue in the resulting state bank which shall have all the
27property, rights, powers, and duties of the national bank or
28federal savings association, out-of-state bank, or state or
29federally chartered credit union, except that the resulting
30state bank shall have only the authority to engage in such
31business and exercise such powers as it would have, and shall
32be subject to the same prohibitions and limitations to which
33it would be subject, upon original incorporation under this
34chapter. The articles of incorporation of the resulting
35state bank shall be the provisions stated in the articles of
-87-1conversion.
23. A liability of the national bank or federal savings
3association, out-of-state bank, or state or federally chartered
4credit union, or of the national bank’s or federal savings
5association’s, out-of-state bank’s, or state or federally
6chartered credit union’s shareholders, directors, or officers,
7is not affected by the conversion. A lien on any property of
8the national bank or federal savings association, out-of-state
9bank, or state or federally chartered credit union is not
10impaired by the conversion. A claim existing or action pending
11by or against the national bank or federal savings association,
12out-of-state bank, or state or federally chartered credit union
13 may be prosecuted to judgment as if the conversion had not
14taken place, or the resulting state bank may be substituted in
15its place.
164. The title to all real estate and other property owned by
17the converting national bank or federal savings association,
18out-of-state bank, or state or federally chartered credit union
19 is vested in the resulting state bank without reversion or
20impairment.
21 Sec. 131. Section 524.1416, Code 2021, is amended by adding
22the following new subsection:
23 NEW SUBSECTION. 3. Upon request, the superintendent shall
24expressly revoke the authorization to do business of any state
25bank that converts into a national bank or federal savings
26association pursuant to this section and shall return the
27physical copy of such state bank’s authorization to do business
28in a manner clearly indicating that the authorization has been
29revoked.
30 Sec. 132. Section 524.1417, subsection 2, Code 2021, is
31amended to read as follows:
322. If a shareholder of a national bank, or federal savings
33association, or out-of-state bank, or a member of a state or
34federally chartered credit union, that converts into a state
35bank objects to the plan of conversion and complies with
-88-1the requirements of applicable laws of the United States,
2the resulting state bank is liable for the value of the
3shareholder’s shares as determined in accordance with such laws
4of the United States.
5 Sec. 133. Section 524.1421, subsection 2, paragraph d, Code
62021, is amended to read as follows:
7d. The applicable fee payable to the secretary of state,
8under section 490.122, for the filing and recording of the
9articles of conversion.
10 Sec. 134. Section 524.1422, Code 2021, is amended to read
11as follows:
12524.1422 Notice of mutual to stock conversion.
13Within thirty days after an application for conversion has
14been accepted for processing, the mutual corporation, mutual
15holding company, federal mutual association, or federal mutual
16holding company shall publish a notice of the delivery of the
17articles of conversion to the superintendent in a newspaper of
18general circulation published in the municipal corporation or
19unincorporated area in which the mutual corporation, mutual
20holding company, federal mutual association, or federal mutual
21holding company has its principal place of business, or if
22there is none, a newspaper of general circulation published
23in the county, or in a county adjoining the county, in which
24the mutual corporation, mutual holding company, federal
25mutual association, or federal mutual holding company has its
26principal place of business. A copy of the notice shall also
27be posted on the internet site of the mutual corporation,
28mutual holding company, federal mutual association, or federal
29mutual holding company for at least thirty days. The notice
30shall set forth the information required by the superintendent.
31 Sec. 135. Section 524.1502, subsection 3, Code 2021, is
32amended to read as follows:
333. Adoption of each amendment shall require the affirmative
34vote of the holders of a majority of the shares entitled
35to vote thereon and, if any class or series is entitled to
-89-1vote thereon on the amendment as a class separate group, the
2affirmative vote of the holders of a majority of the shares of
3each class or series entitled to vote thereon as a class on the
4amendment by that separate group.
5 Sec. 136. Section 524.1503, subsections 1, 3, and 4, Code
62021, are amended to read as follows:
71. The holders of the outstanding shares of a class are
8entitled to vote as a separate voting group on a proposed
9amendment if the amendment does would do any of the following:
10a. Increases Increase or decreases decrease the aggregate
11number of authorized shares of the class.
12b. Increases Increase or decreases decrease the par value of
13the shares of the class.
14c. Effects Effect an exchange or reclassification of all or
15part of the shares of the class into shares of another class
16or effects a cancellation of all or part of the shares of the
17class.
18d. Effects Effect an exchange or reclassification, or
19creates the right of exchange, of all or part of the shares of
20another class into shares of that class.
21e. Changes Change the designation, rights, preferences, or
22limitations of all or part of the shares of the class.
23f. Changes Change the shares of all or part of the class
24into a different number of shares of the same class.
25g. Creates Create a new class of shares having rights or
26preferences with respect to distributions or to dissolution
27that are prior, superior, or substantially equal to the shares
28of the class.
29h. Increases Increase the rights, preferences, or number
30of authorized shares of any class that, after giving effect
31to the amendment, have rights or preferences with respect to
32distributions or to dissolution that are prior, superior, or
33substantially equal to the shares of the class.
34i. Limits Limit or denies deny an existing preemptive right
35of all or part of the shares of the class.
-90- 1j. Cancels Cancel or otherwise affects affect rights to
2distributions or dividends that have accumulated but not yet
3been declared on all or part of the shares of the class.
43. If a proposed amendment that entitles two or more classes
5or series of shares to vote as separate voting groups under
6this section would affect those two or more classes or series
7in the same or a substantially similar way, the shares of all
8the classes or series so affected must vote together as a
9single voting group on the proposed amendment.
104. A class or series of shares is entitled to the voting
11rights granted by this section although even if the articles of
12incorporation provide that the shares are nonvoting shares.
13 Sec. 137. Section 524.1504, subsection 1, paragraphs c and
14e, Code 2021, are amended to read as follows:
15c. The text of each amendment adopted, which shall be set
16forth in full.
17e. For a state bank incorporated as a stock corporation, the
18number of shares entitled to vote on the amendment, and if the
19shares of any class are entitled to vote thereon as a class,
20the number of shares of each class. For a mutual corporation,
21the number of member votes entitled to be cast.
22 Sec. 138. Section 524.1504, subsection 2, Code 2021, is
23amended to read as follows:
242. The articles of amendment shall be delivered to the
25superintendent together with the applicable fees for the filing
26and recording of the articles of amendment.
27 Sec. 139. Section 524.1506, subsection 1, Code 2021, is
28amended to read as follows:
291. The secretary of state shall record the articles of
30amendment, and the articles of amendment shall be filed in the
31office of the county recorder in the county in which the state
32bank has its principal place of business. The secretary of
33state upon the filing of the articles of amendment shall issue
34a certificate of amendment and send the same to the state bank.
35 Sec. 140. Section 524.1508, subsection 4, Code 2021, is
-91-1amended to read as follows:
24. The restated articles of incorporation shall be
3delivered to the superintendent together with the applicable
4fees for the filing and recording of the restated articles
5of incorporation. The superintendent shall conduct such
6investigation and give approval or disapproval, as provided in
7section 524.1505. If the superintendent approves the restated
8articles of incorporation, the superintendent shall deliver
9them with the written approval on the restated articles of
10incorporation to the secretary of state for filing, and the
11restated articles of incorporation shall be filed in the office
12of the county recorder. The secretary of state upon filing
13the restated articles of incorporation shall issue a restated
14certificate of incorporation and send the certificate to the
15state bank or its representative.
16 Sec. 141. Section 524.1601, Code 2021, is amended by adding
17the following new subsections:
18 NEW SUBSECTION. 5. In addition to the criminal penalties
19provided in subsections 1, 2, 3, and 4, the superintendent may
20impose a civil penalty on any director, officer, or employee
21of a state bank or bank holding company for any violation
22enumerated in subsection 1, 2, 3, or 4. The amount of the
23civil penalty imposed shall be determined in the same manner
24as prescribed by those subsections for calculating criminal
25penalties.
26 NEW SUBSECTION. 6. The superintendent may impose an initial
27civil penalty of up to five hundred thousand dollars on any
28director or officer of a state bank which closes a transaction
29without first receiving the approval of the superintendent
30in violation of section 524.1304, 524.1309, 524.1403, or
31524.1408, or which closes a transaction in violation of section
32524.1401, subsection 2. The superintendent may also impose a
33civil penalty of up to ten thousand dollars on any director or
34officer of a state bank for each day on which the state bank
35operates after closing a transaction without first receiving
-92-1the approval of the superintendent in violation of section
2524.1304, 524.1309, 524.1403, or 524.1408, or which closes a
3transaction in violation of section 524.1401, subsection 2.
4Civil penalties imposed on a director or officer of a state
5bank in accordance with this subsection shall be in addition
6to any penalties imposed on any other director or officer of
7the state bank pursuant to this subsection or on the state bank
8pursuant to section 524.1602, subsection 2.
9 Sec. 142. Section 524.1602, Code 2021, is amended to read
10as follows:
11524.1602 Penalties applicable to state bank.
121. The superintendent may impose a penalty on a state bank
13of up to one thousand dollars for each day:
141. a. That it holds investments for its own account in
15bonds or securities in violation of section 524.901.
162. b. On which it accepts and holds drafts in violation of
17section 524.903.
183. c. On which it has money loaned, credit extended or
19holds discounted or purchased evidences of indebtedness or
20agreements for the payment of money, in violation of sections
21524.904 through 524.907.
224. d. On which it has money loaned, invested or is
23otherwise in violation of section 524.1102 or 524.1104.
245. e. On which it publishes, disseminates, or distributes
25any advertising containing any false, misleading, or deceptive
26statements concerning rates, terms, and conditions on which
27loans are made or deposits are received, in violation of
28section 524.1606.
292. The superintendent may impose an initial penalty of
30up to five hundred thousand dollars on a state bank which
31closes a transaction without first receiving the approval
32of the superintendent in violation of section 524.1304,
33524.1309, 524.1403, or 524.1408, or which closes a transaction
34in violation of section 524.1401, subsection 2. The
35superintendent may also impose a penalty on a state bank of up
-93-1to ten thousand dollars for each day on which it operates after
2closing a transaction without first receiving the approval of
3the superintendent in violation of section 524.1304, 524.1309,
4524.1403, or 524.1408, or which closes a transaction in
5violation of section 524.1401, subsection 2.
6 Sec. 143. Section 524.1801, unnumbered paragraph 1, Code
72021, is amended to read as follows:
8As used in this chapter subchapter unless the context
9otherwise requires:
10 Sec. 144. Section 524.1802, subsection 1, paragraph h, Code
112021, is amended to read as follows:
12h. “Incorporated in any state” means a limited liability
13company organized as a state bank under this chapter and a
14 limited liability company organized as a state bank under the
15laws of any state as defined in 12 U.S.C. §1813(a)(3).
16 Sec. 145. Section 524.1805, subsections 1, 2, 3, 4, and 5,
17Code 2021, are amended by striking the subsections.
18 Sec. 146. Section 524.2001, Code 2021, is amended to read
19as follows:
20524.2001 Applicability of other chapters.
21Chapters 489, 490, 491, 492, and 493 do not apply to banks
22except as provided by this chapter.
23 Sec. 147. REPEAL. Sections 524.226, 524.302A, 524.314,
24524.315, 524.1008, 524.1205, and 524.1412, Code 2021, are
25repealed.
26EXPLANATION
27The inclusion of this explanation does not constitute agreement with
28the explanation’s substance by the members of the general assembly.
29This bill relates to banks, makes appropriations, provides
30penalties, and makes penalties applicable.
31The bill modifies numerous provisions of Code chapter 524,
32and makes conforming changes to Code sections 12.61, 422.61,
33and 453A.8.
34The bill adds the following new defined terms to Code section
35524.103: “affiliate”, “national bank”, “out-of-state bank”,
-94-1and “safe deposit box”. Additionally, the bill modifies the
2following defined terms in Code section 524.103: “articles
3of incorporation”, “bank”, “board of directors”, “business
4of banking”, “calculation date”, “chief executive officer”,
5“contractual commitment to advance funds”, “director”,
6“executive officer”, “insured bank”, “member”, “membership
7interest”, “officer”, “operations subsidiary”, “shareholder”,
8“shares”, “state bank”, “supervised financial organization”,
9and “unincorporated area”. The bill strikes from Code section
10524.103 the term “manager”.
11The bill establishes who will serve as the superintendent
12of banking when the office is vacant or the superintendent is
13unable to serve. The bill modifies the rights and obligations
14of the superintendent, including the superintendent’s rights
15and obligations with respect to ordering a state bank to cease
16to carry on business. Additionally, the bill amends Code
17section 524.207, which appropriates money from the department
18of commerce revolving fund to the division of banking. The
19bill provides that the amount of the appropriation from the
20department of commerce revolving fund is determined by the
21amount of fees and assessments paid to the superintendent.
22The bill modifies the type of entity a state bank may utilize
23when incorporating and modifies the steps in the incorporation
24process.
25The bill amends provisions of Code chapter 524, subchapter
26V, related to fractional shares, record dates, voting lists,
27share information that is required to be included in the state
28bank’s articles of incorporation, and voting by a member of a
29mutual corporation.
30The bill provides for the participation in a meeting of
31the directors and the notice required in conjunction with
32the meetings. Additionally, the bill establishes who may
33administer an oath to a director.
34The bill modifies provisions relating to the decisions of
35officers that do not require shareholder approval.
-95- 1The bill establishes the types and amounts of assets that
2state banks are authorized to hold and invest in. The bill
3authorizes state banks to conduct certain activities in
4electronic form. Additionally, the bill modifies provisions
5related to safe deposit boxes.
6The bill amends provisions related to a state bank’s ability
7to invest in certain public welfare investments, when a state
8bank may purchase cash value life insurance contracts, and
9real property purchased by a state bank at a foreclosure sale.
10Additionally, the bill modifies provisions related to the
11granting of loans and extensions of credit by a state bank.
12The bill modifies provisions related to when a state bank
13is required to cease acting as a fiduciary, the duties of a
14temporary fiduciary, the voluntary relinquishment of fiduciary
15capacity, and the succession of fiduciary accounts.
16The bill requires that fees paid to an affiliate must be made
17in compliance with 12 U.S.C. §371c and 12 U.S.C. §371c-1.
18The bill amends provisions related to the superintendent’s
19authority over out-of-state offices of a state bank.
20Additionally, the bill establishes where data processing
21services may take place. The bill requires a bank doing
22business in this state electronically to identify its legally
23chartered name in any online interface.
24The bill makes syntax and terminology changes to Code
25sections 524.1301, 524.1303, 524.1305, and 524.1306.
26Additionally, the bill modifies provisions related to a state
27bank ceasing to carry on the business of banking and continuing
28as a corporation.
29The bill modifies provisions relating to the types of
30entities that may merge into a state bank and the types of
31entities a state bank may merge into. The bill establishes
32information that must be included in the articles of merger and
33the plan of merger. Additionally, the bill provides for the
34types of entities that may convert into a state bank and the
35requirements related to articles of conversion.
-96- 1The bill modifies provisions related to the affirmative vote
2required of a class or series of shares to adopt an amendment
3to the state bank’s articles of incorporation. The bill makes
4syntax and terminology changes to Code section 524.1503.
5The bill authorizes the superintendent to impose civil
6penalties on a director, officer, or employee of a state bank
7or bank holding company in enumerated instances.
8The bill strikes subsections 1 through 5 from Code
9section 524.1805, which provide restrictions on mergers and
10acquisitions.
11The bill modifies Code section 524.2001 to strike the
12reference to Code chapter 489, the revised uniform limited
13liability company Act.
14The bill repeals Code section 524.226, which provides for
15the management of a state bank by the superintendent after
16taking over the management of the property and business of the
17state bank.
18The bill repeals Code section 524.302A, which provides for
19the requirements associated with articles of incorporation for
20state banks organized as limited liability companies.
21The bill repeals Code section 524.314, which provides for
22the renewal of the corporate existence of state banks existing
23and operating on January 1, 1970.
24The bill repeals Code section 524.315, which provides that
25state banks organized as limited liability companies are also
26subject to Code chapter 489.
27The bill repeals Code section 524.1008, which provides for
28the succession of fiduciary accounts to an independent bank.
29The bill repeals Code section 524.1205, which allows a state
30bank to acquire, establish, operate, or relocate a branch in
31a state other than this state.
32The bill repeals Code section 524.1412, which provides for
33publication of notice after the superintendent accepted the
34application for conversion.
-97-jda/rn
2penalties, and making penalties applicable.
3BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1 Section 1. Section 12.61, subsection 1, paragraph a, Code
22021, is amended to read as follows:
3a. “Financial institution” means a state bank as defined in
4section 524.103, subsection 41, a federally chartered state
5bank having its principal office within this state, a federally
6chartered credit union having its principal office within this
7state, a federally chartered savings and loan association
8having its principal office within the state, a credit union
9organized under chapter 533, or a trust company organized or
10incorporated under the laws of this state.
11 Sec. 2. Section 422.61, subsection 1, Code 2021, is amended
12to read as follows:
131. “Financial institution” means a state bank as defined in
14section 524.103, subsection 41, a state bank chartered under
15the laws of any other state, a national banking association,
16a trust company, a federally chartered savings and loan
17association, an out-of-state state chartered savings bank, a
18financial institution chartered by the federal home loan bank
19board, a non-Iowa chartered savings and loan association, or a
20production credit association.
21 Sec. 3. Section 453A.8, subsection 6, Code 2021, is amended
22to read as follows:
236. The director may authorize a bank as defined by section
24524.103, subsection 8, to sell stamps. A bank authorized to
25sell stamps shall comply with all of the requirements governing
26the sale of stamps by the department. Section 453A.12 shall
27apply to any bank authorized to sell stamps.
28 Sec. 4. Section 524.102, Code 2021, is amended by adding the
29following new subsection:
30 NEW SUBSECTION. 10. The opportunity for state banks to
31adopt, in a manner that is compatible with and subject to the
32purposes of this chapter, new and emerging technologies that
33enhance the efficiency and convenience of banking products and
34services.
35 Sec. 5. Section 524.103, Code 2021, is amended by adding the
-1-1following new subsections:
2 NEW SUBSECTION. 2A. “Affiliate” means the same as defined
3in section 524.1101.
4 NEW SUBSECTION. 22A. “Federal savings association” means a
5corporation organized under 12 U.S.C. §1464.
6 NEW SUBSECTION. 32A. “National bank” means a corporation
7organized under 12 U.S.C. §21 whose deposits are insured by
8the federal deposit insurance corporation or whose powers are
9limited exclusively to the exercise of trust or fiduciary
10powers.
11 NEW SUBSECTION. 34A. “Out-of-state bank” means a
12corporation, other than a credit union, industrial bank, or
13trust company, that is authorized by the laws of another state
14to solicit, receive, or accept money or its equivalent for
15deposit or to otherwise engage in the business of banking.
16 NEW SUBSECTION. 36A. “Safe deposit box” means a safe, lock
17box, or other secure storage receptacle located on the premises
18of a bank.
19 Sec. 6. Section 524.103, subsections 6, 8, 10, 12, 13, 16,
2017, 20, 22, 25, 27, 29, 33, 34, 38, 39, 41, 44, and 48, Code
212021, are amended to read as follows:
226. “Articles of incorporation” means the original, amended,
23 or restated articles of incorporation and all amendments
24thereto and includes articles of merger. “Articles of
25incorporation” also means the original or restated articles of
26organization and all amendments including articles of merger if
27a state bank is organized as a limited liability company under
28this chapter.
298. “Bank” means a corporation or limited liability company
30 organized under this chapter or 12 U.S.C. §21, a national bank,
31a federal savings association, or an out-of-state bank.
3210. “Board of directors” means the board of directors of a
33state bank as provided in section 524.601. For a state bank
34organized as a limited liability company under this chapter,
35“board of directors” means a board of directors or board of
-2-1managers as designated by the limited liability company in its
2articles of organization or operating agreement.
312. “Business of banking” means engaging in the regular
4 business of soliciting, receiving, or accepting money or its
5equivalent for deposit, and any other business generally done
6by banks.
713. “Calculation date” means the most recent of the
8following:
9a. The date the state bank’s statement of condition is
10required to be filed pursuant to section 524.220, subsection 2.
11b. The date an event occurs that reduces or increases the
12state bank’s aggregate capital by ten percent or more.
13c. As the superintendent may direct.
1416. “Chief executive officer” means the person designated by
15the board of directors to be responsible for the implementation
16of and adherence to board policies and resolutions by all
17officers and employees of the state bank.
1817. a. “Contractual commitment to advance funds” means a
19state bank’s obligation to do either of the following:
20(1) Advance funds under a standby letter of credit or other
21similar arrangement.
22(2) Make payment, directly or indirectly, to a third person
23contingent upon default by a customer of the state bank in
24performing an obligation and to make such payment in keeping
25with the agreed upon terms of the customer’s contract with
26a third person, or to make payments upon some other stated
27condition.
28b. The term does not include commercial letters of credit
29and similar instruments where the issuing state bank expects
30the beneficiary to draw on the issuer, that do not guarantee
31payment, and that do not provide for payment in the event of a
32default by a third person.
3320. “Director” means a member of the board of directors
34and includes a manager of a state bank organized as a limited
35liability company under this chapter.
-3- 122. “Executive officer” means a person who participates or
2has authority to participate, other than in the capacity of a
3director or manager, in major policymaking functions of a state
4bank, whether or not the officer has an official title, whether
5or not such a title designates the officer as an assistant, or
6whether or not the officer is serving without salary or other
7compensation. The chief executive officer, chairperson of the
8board, the president, every vice president, and the cashier
9of a state bank are deemed to be executive officers, unless
10such an officer is excluded, by resolution of the board of
11directors of a state bank or by the bylaws of the state bank,
12from participation, other than in the capacity of a director,
13in major policymaking functions of the state bank, and the
14officer does not actually participate in the major policymaking
15functions. All officers who serve on a board of directors are
16deemed to be executive officers, except as provided for in
17section 524.701, subsection 3.
1825. “Insured bank” means a state bank the deposits of which
19are insured in accordance with the provisions of the Federal
20Deposit Insurance Act.
2127. “Member” means a person with a membership interest
22in a state bank organized as a limited liability company or
23 incorporated as a mutual corporation under this chapter.
2429. “Membership interest” means a member’s share of the
25profits and losses, the right to receive distributions of
26assets, and any right to vote or participate in management of a
27state bank organized as a limited liability company under this
28chapter or of a state bank incorporated as a mutual corporation
29under this chapter.
3033. “Officer” means chief executive officer, executive
31officer, or any other administrative official of a state bank
32elected by the state bank’s board of directors to carry out any
33of the state bank’s operating rules and policies.
3434. “Operations subsidiary” means a wholly owned corporation
35incorporated and controlled by a state bank that performs
-4-1functions which the state bank is authorized to perform.
238. “Shareholder” means one who is a holder of record of
3shares in a state bank. If a state bank is organized as a
4limited liability company under this chapter, “shareholder”
5 means a member of the limited liability company. If a state
6bank is incorporated as a mutual corporation under this
7chapter, “shareholder” means a member of the mutual corporation.
839. “Shares” means the units into which the proprietary
9interests in a state bank incorporated as a stock corporation
10are divided, including any membership interests of a state bank
11organized as a limited liability company under this chapter.
1241. “State bank” means any bank incorporated pursuant to
13the provisions of this chapter after January 1, 1970, and any
14“state bank” incorporated pursuant to the laws of this state and
15doing business as such on January 1, 1970, or a bank organized
16as a limited liability company or a mutual corporation under
17this chapter.
1844. “Supervised financial organization” as defined and used
19in the Iowa consumer credit code, chapter 537, includes a
20person state bank organized pursuant to this chapter.
2148. “Unincorporated area” means a village within which an
22area where a state bank or national bank has its principal
23place of business that is not within a municipal corporation.
24 Sec. 7. Section 524.103, subsection 26, Code 2021, is
25amended by striking the subsection.
26 Sec. 8. Section 524.105, subsection 2, Code 2021, is amended
27to read as follows:
282. All state banks are subject to the provisions and
29requirements of this chapter in every particular, and all
30national banks out-of-state banks, and federal savings
31associations, now or hereafter doing business in this state,
32are subject to the provisions of this chapter, to the extent
33applicable, from July 1, 1995 2021.
34 Sec. 9. Section 524.107, subsections 1 and 2, Code 2021, are
35amended to read as follows:
-5- 11. A person, other than a state bank which is subject to
2the provisions of this chapter, an out-of-state bank, and
3a national bank or federal savings association authorized
4by the laws of the United States to engage in the business
5of receiving money for deposit, and except as provided in
6subsection 2, shall not engage in this state in the business
7of receiving money for deposit, transact the business of
8banking, or establish in this state a place of business for
9such purpose.
102. A person doing business in this state shall not use
11the words “bank” or “trust” or use any derivative, plural,
12or compound of the words “bank”, “banking”, or “bankers”, or
13“trust” in any manner which would tend to create the impression
14that the person is authorized to engage in the business of
15banking or to act in a fiduciary capacity, except a state
16bank authorized to do so by this chapter or a an out-of-state
17 bank authorized to do so by the laws of another state, a
18national bank to the extent permitted by the laws of the
19United States, a bank holding company as defined in section
20524.1801, a savings and loan holding company as defined in 12
21U.S.C. §1467a, or a federal savings association to the extent
22permitted by the laws of the United States, or, insofar as the
23word “trust” is concerned, an individual permissibly serving
24as a fiduciary in this state, pursuant to section 633.63,
25or, insofar as the words “trust” and “bank” are concerned,
26a nonresident corporate fiduciary permissibly serving as a
27fiduciary in this state pursuant to section 633.64.
28 Sec. 10. Section 524.109, subsection 1, Code 2021, is
29amended to read as follows:
301. A state bank may be organized under this chapter as a
31bankers’ bank. The bankers’ bank is subject to all rights,
32privileges, duties, restrictions, penalties, liabilities,
33conditions and limitations applicable to a state bank
34generally, except as limited in the definition of bankers’
35bank contained in section 524.103, subsection 9. However, a
-6-1bankers’ bank shall have the same powers as those granted by
2federal law and regulation to a national bank organized as a
3bankers’ bank under 12 U.S.C. §27.
4 Sec. 11. Section 524.203, Code 2021, is amended to read as
5follows:
6524.203 Superintendent — vacancy.
7If the office of the superintendent of banking is vacant
8or the superintendent is unable to serve, the chief of the
9bank bureau of the banking division shall be the acting
10superintendent until the governor appoints a new superintendent
11or acting superintendent. If the chief of the bank bureau is
12unable to serve, the chief examiner of the finance bank bureau
13of the banking division shall be the acting superintendent
14until the governor appoints a new superintendent or acting
15superintendent. If both the chief of the bank bureau and
16the chief examiner of the finance bank bureau are unable to
17serve, the chief of the professional licensing and regulation
18 finance bureau of the banking division shall be the acting
19superintendent until the governor appoints a new superintendent
20or acting superintendent.
21 Sec. 12. Section 524.207, subsections 2 and 6, Code 2021,
22are amended to read as follows:
232. All fees and assessments generated as the result of
24a federally chartered national bank or federal savings and
25loan association converting to a state-chartered state bank
26on or after December 31, 2015, and thereafter, are payable
27to the superintendent. The superintendent shall pay all the
28fees and assessments received by the superintendent pursuant
29to this subsection to the treasurer of state within the time
30required by section 12.10 and the fees and assessments shall
31be deposited into the department of commerce revolving fund
32created in section 546.12. An amount equal to such fees
33and assessments deposited into the department of commerce
34revolving fund is appropriated from the department of commerce
35revolving fund to the banking division of the department of
-7-1commerce for the fiscal year in which a federally chartered
2 national bank or federal savings and loan association converted
3to a state-chartered state bank and an amount equal to such
4annualized fees and assessments deposited into the department
5of commerce revolving fund in succeeding years is appropriated
6from the department of commerce revolving fund to the banking
7division of the department of commerce for succeeding fiscal
8years for purposes related to the discharge of the duties and
9responsibilities imposed upon the banking division of the
10department of commerce, the superintendent, and the state
11banking council by the laws of this state. This appropriation
12shall be in addition to the appropriation of moneys otherwise
13described in this section. If a state-chartered state
14 bank converts to a federally chartered national bank or
15federal savings and loan association, any appropriation made
16pursuant to this subsection for the following fiscal year
17shall be reduced by the amount of the assessment paid by the
18state-chartered state bank during the fiscal year in which the
19state-chartered state bank converted to a federally chartered
20 national bank or federal savings and loan association.
216. All moneys received by the superintendent pursuant
22to a multi-state settlement with a provider of financial
23services such as a mortgage lender, a mortgage servicer, or
24any other person regulated by the banking division of the
25department of commerce shall be deposited into the department
26of commerce revolving fund created in section 546.12 and
27an amount equal to the amount deposited into the fund is
28appropriated to the banking division of the department of
29commerce for the fiscal year in which such moneys are received
30and in succeeding fiscal years for the purpose of promoting
31financial-related education and supporting those duties of
32the banking division related to financial regulation that are
33limited to nonrecurring expenses such as equipment purchases,
34training, technology, and retirement payouts related to the
35oversight of mortgage lending, state-chartered state banks, and
-8-1other financial services regulated by the banking division.
2This appropriation shall be in addition to the appropriation of
3moneys otherwise described in this section. The superintendent
4shall submit a report to the department of management and to
5the legislative services agency detailing the expenditure
6of moneys appropriated to the banking division pursuant to
7this subsection during each fiscal year. The initial report
8shall be submitted on or before September 15, 2016, and each
9September 15 thereafter. Moneys appropriated pursuant to
10this subsection are not subject to section 8.33 and shall not
11be transferred, used, obligated, appropriated, or otherwise
12encumbered except as provided in this subsection.
13 Sec. 13. Section 524.208, Code 2021, is amended to read as
14follows:
15524.208 Examiners and other employees.
16The superintendent may appoint examiners and other
17employees, including for the banking division’s internal
18information technology group, as the superintendent deems
19necessary to the proper discharge of the duties imposed upon
20the superintendent by the laws of this state. Pay plans shall
21be established for employees, other than clerical employees or
22employees of the professional licensing and regulation bureau
23of the banking division, who examine the accounts and affairs
24of state banks and who examine the accounts and affairs of
25other persons, subject to supervision and regulation by the
26superintendent, which are substantially equivalent to those
27paid by the federal deposit insurance corporation and other
28federal supervisory agencies in this area of the United States.
29 Sec. 14. Section 524.211, subsection 1, Code 2021, is
30amended to read as follows:
311. The superintendent, general counsel, examiners, and
32other employees assigned to the bank bureau of the banking
33division are prohibited from obtaining a loan of money or
34property from a state-chartered state bank, or any person
35or entity affiliated with a state-chartered state bank,
-9-1unless they do not personally participate in the examination,
2oversight, or official review concerning the regulation of the
3state bank.
4 Sec. 15. Section 524.211, Code 2021, is amended by adding
5the following new subsection:
6 NEW SUBSECTION. 8. The superintendent shall not
7participate in the examination, oversight, or official review
8concerning the regulation of any state bank or any other
9enterprise, person, or affiliate subject to the regulatory
10purview of the banking division of which the superintendent
11is a shareholder, member, partner, owner, director, officer,
12or employee. The superintendent shall recuse themselves from
13participation in any such examination, oversight, or official
14review and the state banking council shall designate a member
15who satisfies the qualifications identified in section 524.201,
16subsection 1, and who is not a shareholder, member, partner,
17owner, director, officer, or employee of the regulated entity
18to act in place of the superintendent.
19 Sec. 16. Section 524.212, subsection 1, Code 2021, is
20amended to read as follows:
211. The superintendent, members of the state banking
22council, general counsel, examiners, or other employees of the
23banking division shall not disclose, in any manner, to any
24person other than the person examined and those regulatory
25agencies referred to in section 524.217, subsection 2, any
26information relating specifically to the supervision and
27regulation of any state bank, persons subject to the provisions
28of chapter 533A, 533C, 533D, 535B, 535D, 536, or 536A, any
29affiliate of any state bank, or an affiliate of a person
30subject to the provisions of chapter 533A, 533C, 536, or
31536A, except when ordered to do so by a court of competent
32jurisdiction and then only in those instances referred to in
33section 524.215, subsection 2, paragraphs “a”, “b”, “c”, “e”,
34and “f”.
35 Sec. 17. Section 524.217, subsection 6, Code 2021, is
-10-1amended to read as follows:
26. The superintendent may enter into contractual agreements
3with other state regulators of financial institutions to share
4examiners or to assist in each state’s respective examinations
5or other supervisory activities. A contractual agreement
6pursuant to this section may provide for reimbursement to the
7state providing assistance. The division of banking shall be
8reimbursed for any costs incurred when providing services to
9other states pursuant to this subsection. Any division of
10banking personnel assisting another state with its examination
11 examinations or other supervisory activities shall be covered
12by the provisions of the other state’s tort claims act, to the
13extent permitted by the laws of the other state. If the law
14of the other state does not extend coverage to the division
15of banking personnel working on the other state’s examination
16 examinations or other supervisory activities, the provisions of
17chapter 669 shall apply.
18 Sec. 18. Section 524.218, Code 2021, is amended by striking
19the section and inserting in lieu thereof the following:
20524.218 Regulation and examination of service providers.
211. Whenever a state bank, or any subsidiary or affiliate
22of a state bank that is subject to examination by the
23superintendent, causes to be performed for itself, by contract
24or otherwise, a covered service, such performance shall be
25subject to regulation and examination by the superintendent to
26the same extent as if the covered service was being performed
27by the state bank itself.
282. For purposes of this section, “covered service” means and
29includes all of the following:
30a. Data processing services.
31b. Activities that support financial services, including
32but not limited to lending, funds transfer, payment processing,
33fiduciary activities, trading activities, and deposit taking.
34c. Internet-related services, including but not limited to
35web services and electronic bill payments, mobile applications,
-11-1system and software development and maintenance, and security
2monitoring.
3d. Activities related to the business of banking.
43. The superintendent may, in the superintendent’s
5discretion, accept examinations authorized or required to
6be conducted by this section, which are made by other state
7or federal financial regulatory agencies listed in section
8534.217, subsection 2, in lieu of any examination authorized or
9required under the laws of this state.
10 Sec. 19. Section 524.220, subsection 1, Code 2021, is
11amended to read as follows:
121. A state bank shall, upon request, render a full, clear,
13and accurate statement of its condition to the superintendent,
14in a format prescribed by the superintendent, verified by the
15oath of two of its officers, and attested by at least two of
16the directors. The superintendent may, in the superintendent’s
17discretion, use any form of statement of condition that is used
18by the federal deposit insurance corporation or the federal
19reserve system, and the superintendent may rely on a statement
20of condition a state bank submits to the federal deposit
21insurance corporation or the federal reserve system.
22 Sec. 20. Section 524.221, subsection 3, Code 2021, is
23amended to read as follows:
243. The provisions of this section, insofar as applicable,
25shall apply to the records of a national bank, or a federally
26chartered savings bank or a federally chartered federal savings
27and loan association, or an out-of-state bank.
28 Sec. 21. Section 524.223, Code 2021, is amended to read as
29follows:
30524.223 Power of superintendent to issue orders.
311. Whenever it shall appear to the superintendent that a
32state bank, or any director, officer, employee, or substantial
33shareholder of the state bank, is engaging or has engaged,
34or the superintendent has reasonable cause to believe that
35the state bank, director, officer, employee, or substantial
-12-1shareholder is about to engage, in an unsafe or unsound
2practice in conducting the business of such state bank, or is
3violating or has violated, or the superintendent has reasonable
4cause to believe that the state bank, director, officer,
5employee, or substantial shareholder is about to violate, any
6provision of this chapter or of any regulation adopted pursuant
7to this chapter, or any condition imposed in writing by the
8superintendent in connection with the approval of any matter
9required by this chapter, or any written agreement entered into
10with the superintendent, or any provision of chapter 12C or
11any rules adopted pursuant to chapter 12C, the superintendent
12may issue and serve upon the state bank, director, officer,
13employee, or substantial shareholder a notice containing a
14statement of the facts constituting the alleged violation or
15violations, or the unsafe or unsound practice or practices,
16and fixing a time and place at which a hearing will be held to
17determine whether an order to cease and desist should be issued
18to the state bank, director, officer, employee, or substantial
19shareholder.
202. If the state bank, director, officer, employee, or
21substantial shareholder fails to appear at the hearing it shall
22be deemed to have consented to the issuance of a cease and
23desist order. In the event of such consent, or if upon the
24record made at such hearing, the superintendent shall find
25that any violation or unsafe or unsound practice specified in
26the notice has been established, the superintendent may issue
27and serve upon the state bank, director, officer, employee,
28or substantial shareholder an order to cease and desist from
29any such violation or practice. Such order may require the
30state bank and its directors, officers, and employees, and
31shareholders to cease and desist from any such violation or
32practice and, further, to take affirmative action to correct
33the conditions resulting from any such violation or practice.
34In addition, if the violation or practice involves a failure
35to comply with chapter 12C or any rules adopted pursuant to
-13-1chapter 12C, the superintendent may recommend to the committee
2established under section 12C.6 that the bank be removed from
3the list of financial institutions eligible to accept public
4funds under section 12C.6A and may require that during the
5current calendar quarter and up to the next succeeding eight
6calendar quarters that the bank do any one or more of the
7following:
8a. Not accept public funds deposits.
9b. Return to the depositors some or all uninsured public
10funds held in demand deposits and, when deposit instruments
11or agreements mature, return to the depositors some or
12all deposits representing proceeds of such instruments or
13agreements.
14c. Pledge collateral to the treasurer of state having a
15value at all times up to one hundred ten percent of the public
16funds held by the bank.
17d. Comply with such other requirements as the superintendent
18may impose.
193. Any order issued pursuant to this section shall become
20effective upon service of the order on the state bank,
21director, officer, employee, or substantial shareholder
22 and shall remain effective except to such extent that it is
23stayed, modified, terminated, or set aside by action of the
24superintendent or of the district court of the Polk county in
25which the state bank has its principal place of business.
264. The superintendent may apply to the district court of
27the Polk county in which the state bank has its principal place
28of business for the enforcement of any order pursuant to this
29section and such court shall have jurisdiction and power to
30order and require compliance.
315. For purposes of this section, “substantial shareholder”
32 means a shareholder exercising a controlling influence over the
33management or policies of a state bank as determined by the
34superintendent.
35 Sec. 22. Section 524.224, Code 2021, is amended to read as
-14-1follows:
2524.224 Grounds for management of state bank by
3superintendent order to cease business — appointment of
4receiver.
51. The superintendent may take over the management of the
6property and business of, without prior notice or hearings,
7order a state bank to cease to carry on its business whenever
8it appears to the superintendent determines that:
9a. The state bank has violated its articles of incorporation
10or any law of this state.
11b. The capital of the state bank is impaired.
12c. The state bank is conducting its business in an unsafe
13or unsound manner.
14d. The state bank is insolvent or is otherwise in such
15condition that it is unsound, unsafe or inexpedient for it to
16transact business.
17e. The state bank has suspended or refused payment of its
18deposits or other liabilities contrary to the terms thereof,
19or the superintendent determines the state bank is unlikely to
20be able to pay its deposits or other liabilities in the near
21future.
22f. The state bank refuses to make its records available
23to the superintendent for examination or otherwise refuses to
24make available, through an officer or employee having knowledge
25thereof, information required by the superintendent for the
26proper discharge of the duties of the superintendent’s office.
27g. The state bank neglects or refuses to observe any order
28of the superintendent made pursuant to the provisions of this
29chapter, unless the enforcement of such order is stayed in a
30proceeding brought by the state bank.
31h. The state bank has not transacted any business or
32performed any of the duties, contemplated by its authorization
33to do business, for a period of one year thirty days.
34i. The state bank has failed to renew its corporate
35existence in the manner provided for in section 524.314 within
-15-1one hundred eighty days prior to the expiration thereof.
22. The superintendent shall thereafter manage the
3property and business of the state bank until such time
4as the superintendent may relinquish to the state bank the
5management thereof, upon such conditions as the superintendent
6may prescribe, or until its affairs be finally dissolved as
7provided in this chapter Upon ordering a state bank to cease
8to carry on its business, the superintendent shall immediately
9appoint the federal deposit insurance corporation as receiver
10pursuant to section 524.1310.
11 Sec. 23. Section 524.225, Code 2021, is amended to read as
12follows:
13524.225 Procedures — judicial review.
14Judicial review of the actions of the superintendent may be
15sought in accordance with chapter 17A. However, contested case
16provisions of chapter 17A, the Iowa administrative procedure
17Act, do not apply to an action by the superintendent to take
18over the management of or to manage order a state bank to
19cease to carry on its business and to appoint a receiver, as
20authorized by sections section 524.224 and 524.226.
21 Sec. 24. Section 524.228, Code 2021, is amended to read as
22follows:
23524.228 Interim Emergency cease and desist order — final
24order — suspension.
251. If it appears to the superintendent that a state bank,
26or any director, officer, employee, or substantial shareholder
27of the state bank is engaging in or is about to engage in an
28unsafe or unsound practice or dishonest act in conducting the
29business of the state bank that is likely to cause insolvency
30or substantial dissipation of assets or earnings of the state
31bank, or is likely to seriously weaken the condition of the
32state bank or otherwise seriously prejudice the interests of
33its depositors prior to the completion of the proceedings
34conducted pursuant to section 524.223, 524.606, subsection
352, or 524.707, subsection 2, the superintendent may issue an
-16-1interim emergency order requiring the state bank, director,
2officer, employee, or substantial shareholder to cease and
3desist from any such practice or act, and to take affirmative
4action, including suspension of the director, officer, or
5employee to prevent such insolvency, dissipation, condition, or
6prejudice pending completion of the proceedings. The interim
7 emergency order becomes effective upon service upon the state
8bank, or upon the director, officer, employee, or substantial
9shareholder of the state bank and, unless set aside, limited,
10or suspended by a court as provided in this chapter, remains
11effective and enforceable pending the completion of the
12administrative proceedings pursuant to the interim emergency
13 order and until such time as the superintendent dismisses the
14charges specified in the interim emergency order, or, if a
15final cease and desist order is issued against the state bank
16or the director, officer, employee, or substantial shareholder
17until the effective date of the final order.
182. Within ten days after the state bank concerned or any
19director, officer, employee, or substantial shareholder is
20served with an interim emergency order, the state bank or such
21director, officer, employee, or substantial shareholder may
22apply to the district court in the of Polk county in which the
23bank has its principal place of business, for an injunction
24setting aside, limiting, or suspending the enforcement,
25operation, or effectiveness of such interim emergency order
26pending the completion of the administrative proceedings. If
27serious prejudice to the interests of the superintendent, the
28state bank, the officer, director, employee, or substantial
29shareholder would result from such hearing, the court may order
30the judicial proceeding to be conducted in camera.
313. The interim emergency order shall contain a concise
32statement of the facts constituting the alleged unsafe or
33unsound practice or alleged dishonest act, and shall fix a time
34and place at which a hearing will be held to determine whether
35a final order to cease and desist should issue against the
-17-1state bank or any director, officer, employee, or substantial
2shareholder. The hearing shall be fixed for a date not later
3than thirty days after service of the interim emergency order
4unless a later date is set at the request of the party so
5served. If the state bank, or the director, officer, employee,
6or substantial shareholder fails to appear at the hearing, the
7state bank, or the director, officer, employee, or substantial
8shareholder is deemed to have consented to the issuance of a
9cease and desist order. In the event of such consent, or if
10upon the record made at the hearing the superintendent finds
11that any unsafe or unsound practice or dishonest act specified
12in the interim emergency order has been established, the
13superintendent may issue and serve upon the state bank, or the
14director, officer, employee, or substantial shareholder a final
15order to cease and desist from any such practice or act. The
16order may require the state bank, or the director, officer,
17employee, or substantial shareholder to cease and desist from
18any such practice or act and, further, to take affirmative
19action, including suspension of the director, officer, or
20employee.
214. A hearing provided for in this section shall be presided
22over by an administrative law judge appointed in accordance
23with section 17A.11. The hearing shall be private, unless
24the superintendent determines after full consideration of
25the views of the party afforded the hearing, that a public
26hearing is necessary to protect the public interest. After
27the hearing, and within thirty days after the case has been
28submitted for decision, the superintendent shall review the
29proposed order of the administrative law judge and render a
30final decision, including findings of fact upon which the
31decision is predicated, and issue and serve upon each party to
32the proceeding an order consistent with this section.
335. Any final order issued by the superintendent pursuant to
34subsection 3 becomes effective upon service of the final order
35on the state bank, director, officer, employee, or substantial
-18-1shareholder and shall remain effective except to the extent
2that it is stayed, modified, terminated, or set aside by action
3of the superintendent or of the district court of the Polk
4 county in which the state bank has its principal place of
5business in accordance with the terms of chapter 17A.
66. In the case of violation or threatened violation of, or
7failure to obey, an interim emergency order issued pursuant to
8subsection 1 or a final order issued pursuant to subsection
93, the superintendent may apply to the district court of the
10 Polk county in which the state bank has its principal place of
11business for the enforcement of the order and such court shall
12have jurisdiction and power to order and require compliance
13with the interim emergency order or final order.
147. For purposes of this section, “substantial shareholder”
15means a shareholder exercising a controlling influence over the
16management or policies of a state bank as determined by the
17superintendent.
18 Sec. 25. NEW SECTION. 524.230 Superintendent authority —
19supervision of state bank.
201. The superintendent may, by order and without prior
21notice, appoint a supervisor for a state bank if the
22superintendent determines that the state bank is in a
23troubled condition and an order of supervision is necessary to
24protect the best interests of the state bank, its depositors,
25creditors, shareholders, or the public.
262. A state bank that is under an order of supervision
27shall not, without the prior approval of the superintendent
28or the supervisor, unless otherwise permitted by the order of
29supervision, do any of the following:
30a. Dispose of, sell, transfer, convey, or encumber the state
31bank’s assets.
32b. Lend or invest the state bank’s money.
33c. Incur a debt, liability, or obligation.
34d. Pay a cash dividend.
35e. Remove an executive officer or director, effect any
-19-1change in the positions of executive officer or director, or
2change the number of executive officers or directors.
33. The superintendent may serve as supervisor of a state
4bank or may appoint as supervisor any person, including an
5employee of the banking division, who the superintendent
6determines is qualified for the position.
74. The superintendent, during the period of supervision
8of the state bank, may require reimbursement by the state
9bank to the extent of the reasonable expenses attributable to
10the service of a supervisor, including costs incurred by the
11division of banking and expenses of the supervisor and any
12professional employees appointed to assist or represent the
13supervisor.
145. A supervisor appointed pursuant to this section shall
15serve until the date specified in the order of supervision or
16the date when the superintendent determines that the conditions
17necessary to terminate the order have been satisfied, whichever
18is earlier. The superintendent may terminate an order of
19supervision at any time.
206. When a state bank has adequately addressed the
21conditions that necessitated the order of supervision, the
22superintendent shall return the state bank to its former or
23new management under conditions reasonable and necessary to
24prevent a recurrence of the conditions that caused the order
25of supervision.
267. The superintendent, at any time during the period of
27supervision of a state bank, may order the state bank to cease
28to carry on its business in accordance with the provisions of
29section 524.224. Notwithstanding any other provision of law
30to the contrary, the banking division, the superintendent, the
31examiners, and all other employees of the banking division
32shall not be liable to any person if a state bank subject to a
33supervision order pursuant to this section ceases to carry on
34the business of banking pursuant to section 524.224 or closes
35or fails pursuant to any applicable provision of federal law.
-20-1 Sec. 26. Section 524.301, Code 2021, is amended to read as
2follows:
3524.301 Incorporators — organizers.
4A state bank may be incorporated or organized as a limited
5liability company under this chapter by one or more individuals
6eighteen years of age or older, a majority of whom shall be
7residents of this state and citizens of the United States.
8 Sec. 27. Section 524.302, subsection 1, unnumbered
9paragraph 1, Code 2021, is amended to read as follows:
10The articles of incorporation of a state bank, in the form
11prescribed by the superintendent, shall must set forth all of
12 the following:
13 Sec. 28. Section 524.302, subsection 1, paragraph b, Code
142021, is amended to read as follows:
15b. The location physical address of its proposed principal
16place of business including the name of the municipal
17corporation, if any, and county.
18 Sec. 29. Section 524.303, subsection 2, Code 2021, is
19amended to read as follows:
202. Applicable fees, payable to the secretary of state as
21specified in section 489.117 or section 490.122, for the filing
22and recording of the articles of incorporation.
23 Sec. 30. Section 524.304, subsection 1, unnumbered
24paragraph 1, Code 2021, is amended to read as follows:
25The incorporators or organizers of a state bank shall,
26within thirty days of the acceptance of the application for
27processing, publish notice of the proposed incorporation or
28organization once each week for two successive weeks in a
29newspaper of general circulation published in the municipal
30corporation which is proposed as the principal place of
31business of the state bank, or if there is none, a newspaper
32of general circulation published in the county, or in a county
33adjoining the county, in which the proposed state bank is to
34have its principal place of business. The notice shall set
35forth all of the following:
-21-1 Sec. 31. Section 524.305, subsection 1, paragraph b, Code
22021, is amended to read as follows:
3b. The convenience and needs of the public will be served
4by the proposed state bank, including by accepting deposits
5from, lending money in, and processing payments in the area the
6proposed state bank will primarily serve.
7 Sec. 32. Section 524.305, subsections 3 and 4, Code 2021,
8are amended to read as follows:
93. Within thirty days after the date of the second
10 publication of the notice required under section 524.304, any
11interested person may submit written comments and information
12to the superintendent concerning the application. Comments
13challenging the legality of an application must be submitted
14separately in writing. The superintendent may extend
15the thirty-day comment period, if, in the judgment of the
16superintendent, extenuating circumstances which justify the
17extension exist.
184. Within thirty days after the date of the second
19 publication of the notice required by section 524.304,
20any interested person may submit a written request of the
21superintendent for a hearing on the application. The request
22shall state the nature of the issues or facts to be presented
23and the reasons why written submissions would be insufficient
24to make an adequate presentation to the superintendent. If the
25reasons are related to factual disputes, the disputes shall be
26described. A written request for a hearing shall be evaluated
27by the superintendent, who may grant or deny the request in
28whole or in part. A hearing request shall generally be granted
29only if it is determined that written submissions would be
30inadequate or that a hearing would otherwise be beneficial
31to the decision-making process. A hearing may be limited to
32issues considered material by the superintendent.
33 Sec. 33. Section 524.306, Code 2021, is amended to read as
34follows:
35524.306 Incorporation or organization of state bank.
-22- 11. Unless a delayed effective date or time is specified, the
2corporate or organizational existence of a state bank begins
3when the articles of incorporation, with the superintendent’s
4approval indicated on the articles of incorporation, are filed
5with the secretary of state. The secretary of state shall
6record the articles of incorporation and forward a copy of them
7to the county recorder of the county in which the state bank is
8to have its principal place of business.
92. The secretary of state’s acknowledgment of filing of
10the articles of incorporation is conclusive proof that the
11incorporators or organizers satisfied all conditions precedent
12to incorporation or organization, except in a proceeding
13instituted by the superintendent to cancel or revoke the
14incorporation or involuntarily dissolve the corporation or
15organization.
16 Sec. 34. Section 524.307, Code 2021, is amended to read as
17follows:
18524.307 Initial organization of state bank.
19Upon incorporation, or organization as a limited liability
20company, of the state bank, the initial board of directors
21shall hold an organizational meeting within this state, at
22the call of a majority of the directors, to complete the
23organization of the state bank by electing officers, adopting
24bylaws, if any are to be adopted, and conducting any other
25business properly brought before the board at the meeting.
26 Sec. 35. Section 524.310, subsection 2, Code 2021, is
27amended to read as follows:
282. The provisions of this section shall not require any
29state bank existing and operating on January 1, 1970, to add
30to, modify or otherwise change its corporate or organizational
31name, either on January 1, 1970, or upon renewal of its
32corporate existence pursuant to section 524.314 at any time
33thereafter.
34 Sec. 36. Section 524.312, Code 2021, is amended to read as
35follows:
-23- 1524.312 Location of state bank — exceptions.
21. A state bank originally incorporated or organized
3pursuant to this chapter shall have its principal place of
4business within the city limits of a municipal corporation.
5The existence of a state bank shall not, however, be affected
6by the subsequent discontinuance of the municipal corporation.
7A state bank existing and operating on January 1, 1970, which
8does not have its principal place of business within the city
9limits of a municipal corporation, may renew its corporate
10or organizational existence pursuant to section 524.314
11 without regard to this section and may also operate as a bank
12or convert to and operate as a bank office when acquired
13by or merged into another state bank and approved by the
14superintendent state of Iowa.
152. A state bank may, with the prior written approval of the
16superintendent, change the location of its principal place of
17business to a new location within the state.
183. If a change in the location of the principal place
19of business of a state bank is proposed, application for
20approval of the superintendent shall be made as required by the
21superintendent pursuant to this section. A change in location
22of the principal place of business of a state bank, including
23a change from one municipal corporation to another municipal
24corporation within an urban complex, requires an amendment to
25the articles of incorporation pursuant to sections 524.1502,
26524.1504, and 524.1506. A state bank seeking approval of a
27change of location pursuant to this subsection shall publish
28a notice of the proposed change of location in a newspaper
29of general circulation in the municipal corporation or
30unincorporated area in which the state bank has its principal
31place of business, or if there is none, in a newspaper of
32general circulation in the county, or in a county adjoining
33the county, in which the state bank has its principal place of
34business, and in the municipal corporation in which it seeks to
35establish its principal place of business, or if there is none,
-24-1in a newspaper of general circulation in the county, or in a
2county adjoining the county, in which the municipal corporation
3is located. The notice shall be published within thirty days
4after the application to the superintendent for approval
5of the change in location is accepted for processing. The
6notice shall set forth the name of the state bank, the present
7location of its principal place of business, the location to
8which it proposes to move its principal place of business, and
9the date upon which the application was accepted for processing
10by the superintendent.
114. Within thirty days after acceptance of an application
12for approval of a change of location of the principal place
13of business of a state bank pursuant to subsection 3, the
14superintendent shall commence an investigation into the
15circumstances of the application as deemed necessary by
16the superintendent, giving due consideration to factors
17substantially similar to those set forth in section 524.305,
18subsection 1, paragraphs “c” through “f”. Within one hundred
19eighty ninety days after the application has been accepted for
20processing, the superintendent shall approve or disapprove
21the application on the basis of the investigation. The
22superintendent shall give written notice of the decision to the
23state bank, and in the event of disapproval a statement of the
24reasons for the disapproval. If the superintendent approves
25the change in location the superintendent shall deliver
26the articles of amendment to the secretary of state. As a
27condition of receiving the decision of the superintendent with
28respect to the application, the state bank shall reimburse the
29superintendent for all expenses incurred by the superintendent
30in connection with the application.
315. A state bank approved under the provisions of section
32524.305, subsection 8, shall not commence its business at
33any location other than within a municipal corporation or
34unincorporated area in which was located the principal place of
35business or an office of the state bank the condition of which
-25-1was the basis for the superintendent authorizing incorporation
2or organization of the new state bank.
3 Sec. 37. Section 524.313, Code 2021, is amended to read as
4follows:
5524.313 Bylaws.
6A state bank may adopt bylaws. The power to adopt, amend,
7or repeal bylaws or adopt new bylaws is vested in the board of
8directors unless reserved to the shareholders by the articles
9of incorporation. The bylaws of a state bank may contain any
10provisions for the regulation and management of the affairs
11of the state bank not inconsistent with law or the articles
12of incorporation. For a state bank organized as a limited
13liability company under this chapter, “bylaws” means the
14operating agreement of the state bank.
15 Sec. 38. Section 524.521, Code 2021, is amended to read as
16follows:
17524.521 Authorized shares.
181. The articles of incorporation of a state bank
19incorporated as a stock corporation must prescribe the classes
20of shares and series of shares within a class and the number
21of shares of each class that the state bank is authorized
22to issue. If more than one class or series of shares is
23authorized, the articles of incorporation must prescribe a
24distinguishing designation for each class or series, and before
25the issuance of shares of a class or series, describe the
26terms, including the preferences, rights, and limitations of
27that class or series. Prior to the issuance of shares of a
28class, the preferences, limitations, and relative rights of
29that class must be described in the articles of incorporation.
30All Except to the extent otherwise permitted by section
31524.522, all shares of a class or series must have terms,
32including preferences, rights, and limitations, and relative
33rights identical with those of other shares of the same class
34except to the extent otherwise permitted by section 524.523 or
35series.
-26- 12. The articles of incorporation of a state bank
2incorporated as a stock corporation must authorize both of the
3following:
4a. One or more classes or series of shares that together
5have unlimited full voting rights.
6b. One or more classes or series of shares, which may be the
7same class, or classes, or series as those with voting rights,
8that together are entitled to receive the net assets of the
9state bank upon dissolution.
103. The articles of incorporation of a state bank
11incorporated as a stock corporation may authorize one or more
12classes or series of shares that have any of the following
13qualities:
14a. Have special, conditional, or limited voting rights, or
15no right to vote, unless prohibited by this chapter.
16b. Are redeemable or convertible as specified in the
17articles of incorporation in any of the following ways:
18(1) At the option of the state bank, the shareholders, or
19another person or upon the occurrence of a designated specified
20 event.
21(2) For cash, indebtedness, securities, or other property.
22(3) In a designated amount or in an amount determined
23in accordance with a designated formula or by reference to
24extrinsic data or events.
25c. Preferred shares are redeemable only by resolution
26of the board of directors with the prior approval of the
27superintendent. Preferred shares which are redeemable
28according to the terms of their issuance shall be redeemed
29only in accordance with such terms. Preferred shares which
30are redeemed shall be canceled and shall not be reissued.
31Preferred shares which are not redeemable according to the
32terms of their issuance are redeemable only pro rata, by lot,
33or by such other equitable method as determined by the board
34of directors.
35d. (1) If preferred shares are redeemed by a state bank,
-27-1the redemption effects a cancellation of the shares, and
2a statement of cancellation shall be filed as provided in
3this paragraph. The filing of the statement of cancellation
4constitutes an amendment to the articles of incorporation and
5reduces the number of preferred shares of the class which the
6state bank is authorized to issue by the number which are
7canceled.
8(2) The statement of cancellation shall be executed by the
9state bank by its president or a vice president and by its
10cashier or an assistant cashier, and acknowledged by one of the
11officers signing such statement, and shall set forth all of the
12following:
13(a) The name of the state bank and the effective date of its
14articles of incorporation.
15(b) The number of preferred shares canceled through
16redemption, itemized by classes.
17(c) The aggregate number of issued shares, itemized by
18classes, after giving effect to the cancellation.
19(d) The amount, expressed in dollars, of the stated capital
20of the state bank after giving effect to the cancellation.
21(e) The number of shares which the state bank has authority
22to issue, itemized by classes, after giving effect to the
23cancellation.
24(3) The statement of cancellation, together with the
25applicable filing and recording fees, shall be delivered to
26the superintendent who shall, if the superintendent finds the
27statement of cancellation satisfies the requirements of this
28section, deliver it to the secretary of state for filing and
29recording in the secretary of state’s office and the statement
30of cancellation shall also be filed and recorded in the office
31of the county recorder. The capital of the state bank is
32deemed to be reduced by the par value of the shares canceled
33upon the effective date of the redemption.
34e. Entitle the holders to distributions calculated in
35any manner, including dividends that may be cumulative,
-28-1noncumulative, or partially cumulative.
2f. Have preference over any other class or series of
3shares with respect to distributions, including dividends and
4distributions upon the dissolution of the state bank.
54. The description of the designations, preferences,
6rights, and limitations, and relative rights of share classes
7or series of shares in subsection 3 is not all-inclusive
8 exhaustive.
95. Unless the articles of incorporation or bylaws otherwise
10provide, the board of directors, by resolution duly adopted and
11with the approval of the superintendent as provided in section
12524.405, may issue from time to time, in whole or in part, the
13shares authorized by the articles of incorporation.
14 Sec. 39. Section 524.522, subsection 1, unnumbered
15paragraph 1, Code 2021, is amended to read as follows:
16If the articles of incorporation provide for such, the
17board of directors may determine, in whole or in part, the
18preferences, rights, and limitations, and relative rights,
19 within the limits set forth in section 524.521, of either of
20the following:
21 Sec. 40. Section 524.523, subsection 2, unnumbered
22paragraph 1, Code 2021, is amended to read as follows:
23Each At a minimum, each share certificate must state on its
24face, at a minimum, all of the following:
25 Sec. 41. Section 524.523, subsection 3, Code 2021, is
26amended by striking the subsection and inserting in lieu
27thereof the following:
283. a. If the state bank is authorized to issue different
29classes of shares or series of shares within a class, the
30front or back of each certificate must summarize all of the
31following:
32(1) The preferences, rights, and limitations applicable to
33each class and series.
34(2) Any variations in preferences, rights, and limitations
35among the holders of the same class or series.
-29- 1(3) The authority of the board of directors to determine the
2terms of future classes or series.
3b. Alternatively, each certificate may state conspicuously
4on its front or back that the state bank will furnish to the
5shareholder the information in paragraph “a” on request in
6writing and without charge.
7 Sec. 42. Section 524.523, subsection 4, Code 2021, is
8amended to read as follows:
94. Each share certificate must be signed either manually or
10in facsimile by two officers as set forth in subsection 1, and
11may bear the corporate seal or its facsimile.
12 Sec. 43. Section 524.524, Code 2021, is amended to read as
13follows:
14524.524 Consideration for shares.
15Except in the case of a distribution of shares authorized by
16section 524.543 or shares issued upon exchanges or conversion,
17common or preferred shares of a state bank may be issued only
18for cash in an amount not less than that determined approved
19 by the superintendent.
20 Sec. 44. Section 524.525, subsection 4, paragraph b, Code
212021, is amended to read as follows:
22b. Unless the subscription agreement provides otherwise, the
23state bank may rescind the agreement and may sell the shares
24if the debt remains unpaid more than twenty days after the
25state bank sends delivers a written demand for payment to the
26subscriber.
27 Sec. 45. Section 524.526, Code 2021, is amended to read as
28follows:
29524.526 Fractional shares.
301. A state bank incorporated as a stock corporation may
31issue fractions of a share or in lieu of doing so may do any of
32the following:
33a. Issue fractions of a share or pay Pay in money cash the
34value of fractions of a share.
35b. Issue scrip in registered or bearer form entitling the
-30-1holder to receive a full share upon surrendering enough scrip
2to equal a full share.
3b. c. Arrange for disposition of fractional shares by the
4shareholders of the state bank.
5c. Issue scrip in registered or bearer form entitling the
6holder to receive a full share upon surrendering enough scrip
7to equal a full share.
82. Each certificate representing scrip must be
9conspicuously labeled “scrip” and must contain the information
10required by section 524.523, subsection 2.
113. The holder of a fractional share or scrip is entitled
12to exercise the rights of a shareholder, including the right
13 rights to vote, to receive dividends, and to participate in
14the assets of the state bank upon liquidation, but only if the
15fractional share or scrip provides for such rights.
164. The board of directors may authorize the issuance of
17scrip subject to any condition considered desirable, including
18either of the following:
19a. That the scrip will become void if not exchanged for full
20shares before a specified date.
21b. That the shares for which the scrip is exchangeable may
22be sold and the proceeds paid to the scrip holders.
23 Sec. 46. Section 524.527, subsections 1 and 2, Code 2021,
24are amended to read as follows:
251. A purchaser of the shares of a state bank incorporated
26as a stock corporation is not liable to the state bank, its
27creditors, or depositors with respect to the shares except to
28pay the consideration for which the shares were authorized to
29be issued under section 524.521, or the consideration specified
30in the subscription agreement authorized under section 524.525.
312. Unless otherwise provided in the articles of
32incorporation, a A shareholder of a state bank is not
33personally liable for any liabilities of the state bank,
34including liabilities arising from the acts or debts of the
35state bank, its creditors, or depositors., subject to the
-31-1following exceptions:
2a. To the extent provided in a provision of the articles
3of incorporation permitted by section 524.302, subsection 2,
4paragraph “c”.
5b. By reason of the shareholder’s own acts or conduct.
6 Sec. 47. Section 524.528, subsections 1 and 2, Code 2021,
7are amended to read as follows:
81. The shareholders of a state bank do not have a preemptive
9right to acquire the state bank’s unissued shares except to the
10extent provided in the articles of incorporation so provide.
112. A statement included in the articles of incorporation
12that “the state bank elects to have preemptive rights”, or
13words of similar import effect, means that, the following
14principles apply except to the extent otherwise expressly
15provided in the articles of incorporation, the following
16principles apply expressly provide otherwise:
17a. A shareholder The shareholders of a state bank has have
18 a preemptive right, granted on uniform terms and conditions
19prescribed by the board of directors to provide a fair and
20reasonable opportunity to exercise the right, to acquire a
21proportional amount of the state bank’s unissued shares upon
22the decision of the board of directors to issue such shares.
23b. A shareholder may waive the shareholder’s preemptive
24right. A waiver evidenced in writing is irrevocable even
25though it is not supported by consideration.
26c. There is no preemptive right with respect to any of the
27following:
28(1) Shares issued as compensation to directors, managers,
29officers, employees, or agents, or employees of the state bank,
30its subsidiaries, or its affiliates.
31(2) Shares issued to satisfy conversion or option rights
32created to provide compensation to directors, managers,
33officers, employees, or agents, or employees of the state bank,
34its subsidiaries, or its affiliates.
35(3) Shares authorized in the articles of incorporation
-32-1that are issued within six months from the effective date of
2incorporation or organization.
3d. A holder Holders of shares of any class or series without
4general voting rights power but with preferential rights to
5distributions or assets has have no preemptive rights with
6respect to shares of any class or series.
7e. A holder Holders of shares of any class or series with
8general voting rights power but without preferential rights
9to distributions or assets has have no preemptive rights with
10respect to shares of any class or series with preferential
11rights to distributions or assets unless the shares with
12preferential rights are convertible into or carry a right to
13subscribe for or acquire shares without preferential rights.
14f. Shares subject to preemptive rights that are not acquired
15by shareholders may be issued to any person for a period of one
16year after being offered to shareholders at a consideration
17set by the board of directors that is not lower than the
18consideration set for the exercise of preemptive rights. An
19offer at a lower consideration or after the expiration of one
20year is subject to the shareholders’ preemptive rights.
21 Sec. 48. Section 524.532, Code 2021, is amended to read as
22follows:
23524.532 Meetings of shareholders.
24Meetings of shareholders may be held at a place, within
25this state, as provided in the articles of incorporation or
26the bylaws, or as fixed in accordance with their provisions.
27In the absence of any such provision, all meetings shall be
28held at the principal place of business of the state bank.
29An annual meeting of the shareholders shall be held during
30the specific month as shall be provided in the articles of
31incorporation, at the location, date, and time as stated in
32or fixed in accordance with the bylaws. Failure to hold the
33annual meeting during the month shall not work a forfeiture
34or dissolution of the state bank. Special meetings of the
35shareholders may be called by the president, the board of
-33-1directors, the holders of not less than one-tenth of all the
2shares entitled to vote at the meeting, or other officers or
3persons as provided in the articles of incorporation or the
4bylaws. If a state bank holds a shareholder meeting at a
5location outside this state, the articles of incorporation or
6bylaws must permit any or all shareholders to participate by
7any means of communication as specified in section 524.533,
8subsection 4.
9 Sec. 49. Section 524.533, subsections 1 and 3, Code 2021,
10are amended to read as follows:
111. Written notice stating the place, day and hour of a
12meeting of the shareholders and, in case of a special meeting,
13the purpose or purposes for which the meeting is called, shall
14be delivered not less than ten nor more than sixty days before
15the date of the meeting, either personally or by mail, by or
16at the direction of the president, the cashier, or the officer
17or persons calling the meeting, to each shareholder of record
18entitled to vote at the meeting. If mailed, the notice is
19deemed to be delivered when deposited in the United States mail
20addressed to the shareholder at the shareholder’s address as
21it appears on the stock transfer books of the state bank with
22postage prepaid. As used in this section, the term “notice”
23 means as defined in section 490.141.
243. A shareholder’s attendance at a meeting results in both
25 all of the following:
26a. Waives the shareholder’s objection to lack of notice or
27defective notice of the meeting, unless the shareholder at the
28beginning of the meeting or promptly upon the shareholder’s
29arrival objects to holding the meeting or transacting business
30at the meeting.
31b. Waives the shareholder’s objection to consideration
32of a particular matter at the meeting that is not within the
33purpose or purposes described in the meeting notice, unless
34the shareholder objects to considering the matter when it is
35presented.
-34-1 Sec. 50. Section 524.535, subsection 2, Code 2021, is
2amended to read as follows:
32. The bylaws or, in the absence of an applicable bylaw,
4the board of directors may fix or provide the manner of fixing,
5in advance, a date as the record date for any determination of
6shareholders entitled to notice of or a shareholder’s meeting,
7to demand a special meeting, to vote, or to take any other
8action at a meeting of shareholders, the. A record date to be
9 fixed under this section shall not be more than seventy days
10and, in the case of a meeting of shareholders, not less than
11ten days prior to before the date on which of the meeting or
12 particular action, requiring the determination of shareholders,
13is to be taken and shall not be retroactive. If a record date
14is not fixed for the determination of shareholders entitled
15to notice of or to vote at a meeting of shareholders, or
16shareholders entitled to receive payment of a dividend, the
17date on which notice of the meeting is mailed or the date on
18which the resolution of the board of directors declaring such
19dividend is adopted, as the case may be, shall be the record
20date for the determination of shareholders. If a determination
21of shareholders entitled to vote at any meeting of shareholders
22has been made as provided in this section, the determination
23applies to any adjournment of the meeting.
24 Sec. 51. Section 524.536, Code 2021, is amended by striking
25the section and inserting in lieu thereof the following:
26524.536 Shareholders’ voting list for meeting.
271. The officer or agent having charge of the stock transfer
28books for shares of a state bank shall, at least ten days
29before each meeting of shareholders, prepare a complete
30alphabetical list of the names of all its shareholders who
31are entitled to vote at the meeting or any adjournment of the
32meeting. The list shall be arranged by voting group and within
33each voting group by class or series of shares, and show the
34address of and the number of shares held by each shareholder.
35Nothing contained in this subsection shall require the state
-35-1bank to include on such list the electronic mail address or
2other electronic contact information of a shareholder.
32. a. The shareholders’ list shall be available for
4inspection by any shareholder beginning ten days before the
5meeting and continuing through the meeting. The shareholders’
6list shall be made available in at least one of the following
7locations:
8(1) The state bank’s principal place of business.
9(2) A reasonably accessible electronic network, provided
10that the information required to gain access to the list is
11provided with the notice of the meeting. In the event that
12the state bank determines to make the list available on an
13electronic network, the state bank shall take reasonable
14steps to ensure that such information is available only to
15shareholders of the state bank.
16b. A shareholder, or the shareholder’s agent or attorney,
17is entitled on written demand to inspect the list at any time
18during usual business hours and at the shareholders’ expense,
19during the period it is available for inspection.
203. The list of shareholders shall also be produced and
21kept open at the time and place of the meeting and is subject
22to the inspection of a shareholder, or a shareholder’s agent
23or attorney, during the entire duration of the meeting. The
24original stock transfer books are prima facie evidence as to
25which shareholders are entitled to examine the list or transfer
26books or to vote at a meeting of shareholders.
274. Failure to comply with the requirements of this section
28shall not affect the validity of action taken at a meeting of
29shareholders.
30 Sec. 52. Section 524.537, Code 2021, is amended by adding
31the following new subsection:
32 NEW SUBSECTION. 3. If a quorum is present, the affirmative
33vote of the majority of the shares represented at the meeting
34and entitled to vote on the subject matter shall be the act of
35the shareholders, unless the vote of a greater number or voting
-36-1by classes is required by the laws of this state or of the
2United States or by the articles of incorporation or bylaws.
3This requirement does not apply to the election of directors as
4provided in section 524.538, subsection 4.
5 Sec. 53. Section 524.538, subsections 1, 3, and 5, Code
62021, are amended to read as follows:
71. Each outstanding share of a state bank shall be entitled
8to one vote on each matter submitted to a vote at a meeting of
9shareholders, except to the extent that the voting rights of
10the shares of a class or series may be limited or denied by the
11articles of incorporation.
123. A shareholder may vote either in person or by proxy
13executed in writing by the shareholder or by the shareholder’s
14duly authorized attorney in fact attorney-in-fact. A proxy
15shall not be valid after eleven months from the date of its
16execution.
175. In an election of directors, a state bank shall not
18vote its own shares held by it as sole trustee unless under
19the terms of the trust the manner in which such shares shall
20be voted may be determined by a donor or beneficiary of the
21trust and unless such donor or beneficiary actually directs
22how the shares shall be voted. However, shares held in trust
23by a state bank pursuant to an instrument in effect prior to
24January 1, 1970, under the terms of which the manner in which
25such shares shall be voted could not be determined by a donor
26or beneficiary of the trust, may be voted in an election of
27directors of a state bank upon petition filed by the state
28bank, to a court of competent jurisdiction, and the appointment
29by such court of an individual to determine the manner in which
30the shares shall be voted. When the shares of a state bank are
31held by such state bank and one or more persons as trustees,
32the shares may be voted by such other person or persons as
33trustees, in the same manner as if the person or persons were
34the sole trustee. Whenever shares cannot be voted by reason
35of being held by a state bank as sole trustee, the shares shall
-37-1be excluded in determining whether matters voted upon by the
2shareholders were adopted by the requisite number of shares.
3 Sec. 54. Section 524.538A, Code 2021, is amended to read as
4follows:
5524.538A Voting by member of mutual corporation.
6All holders of savings, demand, or other authorized
7accounts of a state bank incorporated as or converted to be
8a mutual corporation are members of the state bank. In the
9consideration of all questions requiring action by the members
10of the state bank, each holder of an account shall be permitted
11to cast one vote for each one hundred dollars, or fraction
12thereof, of the withdrawal value of the member’s account. No
13member, however, shall cast more than one thousand member
14votes. All accounts shall be nonassessable.
15 Sec. 55. Section 524.544, subsection 1, Code 2021, is
16amended to read as follows:
171. Whenever any person proposes to purchase or otherwise
18acquire directly or indirectly any of the outstanding shares
19of a state bank, and the proposed purchase or acquisition
20would result in control or in a change in control of the
21state bank, the person proposing to purchase or acquire the
22shares shall first apply in writing to the superintendent
23for a certificate of approval for the proposed change of
24control. The superintendent shall grant the certificate if
25the superintendent is satisfied that the person who proposes
26to obtain control of the state bank is qualified by character,
27experience, and financial responsibility to control and
28operate the state bank in a sound and legal manner, and that
29the interests of the depositors, creditors, and shareholders
30of the state bank, and of the public generally, will not be
31jeopardized by the proposed change of control. A person
32which will become a bank holding company upon completion of
33an acquisition shall make application to the superintendent
34for a certificate of approval as provided in this section.
35Any other bank holding company shall comply with section
-38-1524.1804 in lieu of seeking a certificate of approval under
2this section. In any situation where the president or cashier
3of a state bank has reason to believe any of the foregoing
4requirements have not been complied with, it shall be the duty
5of the president or cashier to promptly report in writing such
6facts to the superintendent upon obtaining knowledge thereof.
7As used in this section, the term “control” means the power,
8directly or indirectly, to elect the board of directors. If
9there is any doubt as to whether a change in the ownership
10of the outstanding shares is sufficient to result in control
11thereof, or to effect a change in the control thereof, such
12doubt shall be resolved in favor of reporting the facts to the
13superintendent.
14 Sec. 56. Section 524.544, Code 2021, is amended by adding
15the following new subsection:
16 NEW SUBSECTION. 1A. As used in this section, the term
17“control” means owning, controlling, or having the power to vote
18twenty-five percent or more of any class of voting securities
19of a state bank or having the power, directly or indirectly,
20to elect the board of directors. If there is any doubt as to
21whether a change in the ownership of the outstanding shares is
22sufficient to result in control thereof, or to effect a change
23in the control thereof, such doubt shall be resolved in favor
24of reporting the facts to the superintendent.
25 Sec. 57. Section 524.544, subsection 2, Code 2021, is
26amended by striking the subsection.
27 Sec. 58. Section 524.604, subsection 1, paragraph d, Code
282021, is amended to read as follows:
29d. Review of the adequacy of the state bank’s internal
30controls and determination of the most appropriate method
31to satisfy the state bank’s audit needs pursuant to section
32524.608.
33 Sec. 59. Section 524.604, subsection 2, Code 2021, is
34amended to read as follows:
352. Directors of a state bank shall discharge the duties
-39-1of their position in good faith and with that diligence, care
2and skill which ordinarily prudent persons would exercise
3under similar circumstances in like positions. The directors
4shall have a continuing responsibility to assure themselves
5that the state bank is being managed according to law and that
6the practices and policies adopted by the board are being
7implemented.
8 Sec. 60. Section 524.605, subsection 1, paragraph a, Code
92021, is amended to read as follows:
10a. Directors of a state bank who vote for or assent to
11the declaration of any dividend or other distribution of the
12assets of a state bank to its shareholders in willful or
13negligent violation of the provisions of this chapter, or of
14any restrictions contained in the articles of incorporation,
15or of any order by the superintendent restricting the payment
16of dividends or other distribution of assets, shall be jointly
17and severally liable to the state bank for the amount of such
18dividend which is paid or the value of such assets which
19are distributed in excess of the amount of such dividend or
20distribution which could have been paid or distributed without
21a violation of the provisions of this chapter, or of the
22restrictions in the articles of incorporation, or of any order
23by the superintendent restricting the payment of dividends or
24other distribution of assets.
25 Sec. 61. Section 524.606, subsection 2, paragraph a, Code
262021, is amended to read as follows:
27a. If, in the opinion of the superintendent, any director
28of a state bank or bank holding company has violated any
29law relating to such state bank or bank holding company, or
30 has engaged in unsafe or unsound practices in conducting the
31business of such state bank or bank holding company, or has
32caused such state bank or bank holding company to violate any
33provision of this chapter or any other law relating to banks
34or banking, the superintendent may cause notice to be served
35upon such director, to appear before the superintendent to
-40-1show cause why the director should not be removed from office.
2A copy of such notice shall be sent to each director of the
3state bank or bank holding company affected, by registered or
4certified mail. If, after granting the accused director a
5reasonable opportunity to be heard, the superintendent finds
6that the director violated any law relating to such state
7bank or bank holding company, or engaged in unsafe or unsound
8practices in conducting the business of such state bank or bank
9holding company, or has caused such state bank or bank holding
10company to violate any provision of this chapter or any other
11law relating to banks or banking, the superintendent, in the
12superintendent’s discretion, may order that such director be
13removed from office, and that such director be prohibited from
14serving in any capacity in any other state bank, bank holding
15company, bank affiliate, trust company, or an entity licensed
16under chapter 533A, 533C, 533D, 535B, 536, or 536A. A copy
17of the order shall be served upon such director and upon the
18state bank or bank holding company of which the person is a
19director at which time the person shall cease to be a director
20of the state bank or bank holding company. The resignation,
21termination of employment, or separation of such director,
22including a separation caused by the closing of the state
23bank or bank holding company at which the person serves as a
24director, does not affect the jurisdiction and authority of the
25superintendent to cause notice to be served and proceed under
26this subsection against the director, if the notice is served
27before the end of the six-year period beginning on the date the
28director ceases to be a director with the state bank.
29 Sec. 62. Section 524.607, subsections 1 and 2, Code 2021,
30are amended to read as follows:
311. The board of directors shall hold at least nine regular
32meetings each calendar year. No more than one regular meeting
33shall be held in any one calendar month. Unless the articles
34of incorporation or bylaws provide otherwise, any director may
35participate in any meeting of the board of directors may permit
-41-1directors to participate in meetings through the use of any
2means of communication by which all directors participating
3may simultaneously hear each other during the meeting. A
4director participating in a meeting by this means is deemed to
5be present at the meeting.
62. A special meeting may be called by any executive officer
7or a director. Notice of a meeting shall be given to each
8director, either personally or by mail, at least two days in
9advance of the meeting. Notice of a regular meeting shall
10not be required if the articles of incorporation, bylaws, or
11a resolution of the board of directors provide for a regular
12monthly meeting date. As used in this section, the term
13“notice” means as defined in section 490.141.
14 Sec. 63. Section 524.607, Code 2021, is amended by adding
15the following new subsection:
16 NEW SUBSECTION. 2A. A director may waive any notice
17required by this chapter, the articles of incorporation, or the
18bylaws before or after the date and time stated in the notice.
19Except as provided in subsection 3, the waiver must be in
20writing, signed by the director entitled to the notice, whether
21before or after the time stated in the notice, and delivered to
22the state bank for filing by the state bank with the minutes or
23corporate records.
24 Sec. 64. Section 524.607, subsection 3, Code 2021, is
25amended by striking the subsection and inserting in lieu
26thereof the following:
273. A director’s attendance at or participation in a meeting
28waives any required notice to the director of such meeting
29unless all of the following apply:
30a. The director at the beginning of the meeting, or promptly
31upon arrival, objects to holding the meeting or transacting
32business at the meeting because the meeting is not lawfully
33called or convened.
34b. The director does not, after objecting, vote for or
35assent to action taken at the meeting.
-42-1 Sec. 65. Section 524.607, subsection 4, Code 2021, is
2amended by striking the subsection.
3 Sec. 66. Section 524.607A, subsection 1, Code 2021, is
4amended to read as follows:
51. Unless the articles of incorporation or bylaws provide
6otherwise, action required or permitted to be taken under this
7chapter at a board of directors’ meeting may be taken without
8a meeting if the action is consented to by all members of the
9board. The action must be evidenced by one or more written
10consents describing the action taken, signed by each director,
11and included in the minutes or filed with the corporate records
12reflecting the action taken. A director may evidence the
13consent required by this subsection by sending a message by
14electronic mail that expressly indicates the director’s consent
15to the proposed action.
16 Sec. 67. Section 524.608, Code 2021, is amended to read as
17follows:
18524.608 Auditing procedures.
191. In addition to any examination made by the banking
20division or other supervisory agency, the board of directors
21shall review the adequacy of the state bank’s internal controls
22and cause to be made no less frequently than once each calendar
23year additional auditing procedures that the board deems to
24be appropriate. The board shall determine the state bank’s
25audit needs and record in the board’s minutes the extent to
26which audit procedures are to be employed. A report which
27summarizes significant audit findings shall be delivered to the
28superintendent as soon as practical upon completion.
292. The superintendent may require that more comprehensive
30auditing procedures be applied to a state bank’s account
31records when deemed necessary. These auditing procedures
32may range from limited scope agreed-upon procedures to an
33unqualified audit opinion.
34 Sec. 68. Section 524.610, subsection 1, Code 2021, is
35amended to read as follows:
-43- 11. The shareholders of a state bank shall fix the
2reasonable compensation of directors for their services as
3members of the board of directors. Subject to approval by
4the shareholders at an annual or special meeting called for
5that purpose, the shareholders of a state bank may adopt a
6pension or profit-sharing plan, or both, or other plan of
7deferred compensation for directors, to which a state bank may
8contribute. Changes to such a pension or profit-sharing plan
9or other plan of deferred compensation, other than changes
10that affect eligibility requirements for directors under the
11plan, benefits provided to directors pursuant to the plan, and
12contributions required by the state bank or directors under
13the plan, may be adopted by the board of directors without
14shareholder approval.
15 Sec. 69. Section 524.611, subsection 2, Code 2021, is
16amended to read as follows:
172. The oath shall be signed by the director, acknowledged
18before an officer individual authorized to take acknowledgments
19of deeds perform notarial acts, and delivered to the
20superintendent.
21 Sec. 70. Section 524.703, subsection 2, Code 2021, is
22amended to read as follows:
232. Subject to approval by the shareholders at an annual or
24special meeting called for the purpose, the board of directors
25of a state bank may adopt a pension or profit-sharing plan,
26or both, or other plan of deferred compensation, for both
27officers and employees, to which the state bank may contribute.
28Changes to such a pension or profit-sharing plan or other
29plan of deferred compensation, other than changes that affect
30eligibility requirements for officers and employees under the
31plan, benefits provided to officers and employees pursuant to
32the plan, and contributions required by state banks, officers,
33or employees under the plan, may be adopted by the board of
34directors without shareholder approval.
35 Sec. 71. Section 524.707, subsection 2, Code 2021, is
-44-1amended to read as follows:
22. Section 524.606, subsection 2, which provides for the
3removal of directors by the superintendent, shall have equal
4application to officers and employees of a state bank, bank
5holding company, bank affiliate, or trust company.
6 Sec. 72. Section 524.802, subsections 9, 11, and 13, Code
72021, are amended to read as follows:
89. Acquire and hold shares of stock in the appropriate
9federal home loan bank and to exercise all powers conferred
10on member banks of the federal home loan bank system that are
11not inconsistent with this chapter. A purchase of federal
12home loan bank shares which causes the state bank’s holdings
13to exceed fifteen percent of aggregate capital, including
14where the ownership of shares exceeding fifteen percent of
15the state bank’s aggregate capital is needed to support the
16state bank’s participation in the federal home loan bank’s
17acquired member assets program provided for in 12 C.F.R. pt.
18955, requires the prior approval of the superintendent. In
19addition, a state bank may own federal home loan bank shares
20in an amount exceeding fifteen percent of the state bank’s
21aggregate capital, but not exceeding twenty-five percent of
22the state bank’s aggregate capital, if the ownership of shares
23exceeding fifteen percent is needed to support the state bank’s
24participation in the federal home loan bank’s acquired member
25assets program as provided for in 12 C.F.R. pt.955.
2611. Become Subject to section 524.109, subsection 2, become
27 a member of a bankers’ bank.
2813. Acquire, hold, and improve real estate for the sole
29purpose of economic or community development, provided that
30the state bank’s aggregate investment in all acquisitions and
31improvements of real estate under this subsection shall not
32exceed fifteen percent of a state bank’s aggregate capital and
33shall be subject to the prior approval of the superintendent,
34the state bank provides the superintendent with thirty days’
35prior written notice of its intention to acquire, hold, and
-45-1improve the real estate, and the superintendent does not object
2to the state bank’s proposed plan within thirty days. For
3purposes of this section, the term “community development”
4 includes public welfare investments as defined in section
5524.901, subsection 7, paragraph “a”, and other investments as
6permitted under 12 U.S.C. §24 and its implementing regulations.
7 Sec. 73. NEW SECTION. 524.802A Electronic activities of
8state bank.
91. A state bank may conduct in electronic form any
10activities that are expressly authorized for state banks under
11any provision of this chapter, including in sections 524.801,
12524.802, and 524.804, and activities that are the functional
13equivalent of any activities expressly authorized for state
14banks under this chapter. A state bank may perform, provide,
15or deliver through electronic means any activity, function,
16product, or service it is authorized to perform by any
17provision of this chapter and must comply with all applicable
18laws and regulations.
192. Subject to the prior approval of the superintendent,
20a state bank may, beginning on July 1, 2021, engage in new
21or innovative electronic activities that are part of the
22business of banking. When determining whether a state bank is
23authorized to engage in a new or innovative electronic activity
24that is not traditionally offered by banks via electronic
25means, the superintendent shall consider whether the activity
26is expressly authorized for state banks under this chapter,
27whether the activity is the functional equivalent of any
28activity authorized for state banks, whether the activity
29is a logical extension of any activity authorized for state
30banks, whether the state bank has the expertise necessary to
31understand and manage the activity, and whether the activity
32presents risks similar to those state banks already assume.
333. A state bank that engages in any new or innovative
34electronic activities must conduct these activities in a
35safe and sound manner and must maintain adequate systems to
-46-1identify, measure, monitor, and control the risks associated
2with its electronic activities. These systems must include
3policies, procedures, internal controls, and management
4information systems governing the electronic activities of
5the state bank and may be tailored to the specific risks
6presented by the electronic activities of the state bank. A
7state bank engaging in new or innovative electronic activities
8must also maintain adequate and effective information security
9infrastructure and controls.
104. The superintendent may adopt rules pursuant to chapter
1117A to implement the provisions of this section, including
12but not limited to application procedures, identifying the
13systems, processes, and technologies a state bank must maintain
14in order to engage in certain new or innovative electronic
15activities, and determining that additional new or innovative
16electronic activities are authorized for state banks without
17prior approval.
18 Sec. 74. Section 524.803, subsection 3, Code 2021, is
19amended to read as follows:
203. Any real property which is held by a state bank pursuant
21to this section and which it ceases to use for banking
22purposes, or is acquired for future use but not used within
23a reasonable period of time five years after title is vested
24in the state bank, shall be sold or disposed of by the state
25bank as directed by the superintendent. This deadline may be
26extended up to an additional five years with prior approval of
27the superintendent, but in no event may a state bank hold the
28property for more than ten years.
29 Sec. 75. Section 524.810A, subsection 1, unnumbered
30paragraph 1, Code 2021, is amended to read as follows:
31A bank shall permit a person named in and authorized by a
32court order to open, examine, and remove the contents of a safe
33deposit box located at the bank. If a court order has not been
34delivered to the bank, the following persons may access and
35remove any or all contents of a safe deposit box located at a
-47-1state bank which box is described in an ownership or rental
2agreement or lease between the state bank and a deceased owner
3or lessee:
4 Sec. 76. Section 524.812, subsection 3, Code 2021, is
5amended to read as follows:
63. If the contents are not claimed within two years after
7their removal from the safe deposit box, the state bank may
8proceed to sell so much of the contents as is necessary to
9pay the past due rentals and the expense incurred in opening
10the safe deposit box, replacement of the locks thereon and
11the sale of the contents. The sale shall be held at the time
12and place specified in a notice published prior to the sale
13once each week for two successive weeks in a newspaper of
14general circulation published in the municipal corporation or
15unincorporated area in which the state bank has its principal
16place of business, or if there is none, a newspaper of general
17circulation published in the county, or in a county adjoining
18the county, in which the state bank has its principal place of
19business. The state bank shall also post this notice on the
20state bank’s internet site for at least two weeks prior to the
21sale. A copy of the notice so published shall be mailed to the
22customer at the customer’s last known address as shown upon the
23records of the state bank. The notice shall contain the name
24of the customer and need only describe the contents of the safe
25deposit box in general terms. The contents of any number of
26safe deposit boxes may be sold under one notice of sale and the
27cost thereof apportioned ratably among the several safe deposit
28box customers involved. At the time and place designated
29in said notice the contents taken from each respective safe
30deposit box shall be sold separately to the highest bidder for
31cash and the proceeds of each sale applied to the rentals and
32expenses due to the state bank and the residue from any such
33sale shall be held by the state bank for the account of the
34customer or customers. Any amount so held as proceeds from
35such sale shall be credited with interest at the customary
-48-1annual rate for savings accounts at said state bank, or in lieu
2thereof, at the customary rate of interest in the community
3where such proceeds are held. The crediting of interest shall
4not activate said account to avoid an abandonment as unclaimed
5property under chapter 556.
6 Sec. 77. Section 524.816, Code 2021, is amended by striking
7the section and inserting in lieu thereof the following:
8524.816 Deposit account insurance.
9A state bank organized under this chapter shall be an
10insured bank and shall acquire and maintain insurance from the
11federal deposit insurance corporation, or its successor, to
12protect each depositor against loss of funds held on account
13by the state bank to the extent the federal deposit insurance
14corporation insures such deposits.
15 Sec. 78. Section 524.819, Code 2021, is amended to read as
16follows:
17524.819 Clearing checks at par.
18Checks drawn on a state bank shall be cleared at par by the
19state bank on which they are drawn. This section shall not be
20applicable where checks are received by a state bank as special
21collection items.
22 Sec. 79. Section 524.821, Code 2021, is amended to read as
23follows:
24524.821 Electronic transmission of funds — restrictions.
251. A state bank may engage in any transaction incidental
26to the conduct of the business of banking and otherwise
27permitted by applicable law, by means of either the direct
28transmission of electronic impulses to or from customers and
29banks or the recording of electronic impulses or other indicia
30of a transaction for delayed transmission to a bank. Subject
31to the provisions of chapter 527, except as preempted by
32other applicable law, a state bank may utilize, establish, or
33operate, alone or with one or more other banks, federal savings
34and loan associations incorporated under federal law, credit
35unions incorporated under the provisions of chapter 533 or
-49-1federal law, corporations licensed under chapter 536A, or third
2parties, the satellite terminals permitted under chapter 527,
3by means of which customers and banks may transmit and receive
4electronic impulses constituting transactions pursuant to this
5section. However, except as preempted by other applicable
6law, such utilization, establishment, or operation shall be
7lawful only when in compliance with chapter 527. Nothing in
8this section shall be construed as authority for any person to
9engage in transactions not otherwise permitted by applicable
10law, nor shall anything in this section be deemed to repeal,
11replace or in any other way affect any applicable law or rule
12regarding the maintenance of or access to financial information
13maintained by any bank.
142. A state bank which offers its customers, or any of them,
15the opportunity to engage in transactions with or through the
16state bank in the manner authorized by subsection 1 shall not
17require a customer to deal with or through the state bank in
18that manner in lieu of writing checks in the usual manner
19upon a conventional checking account, and shall not impose
20any extraordinary charge upon customers who choose to write
21checks in the usual manner upon a conventional checking account
22maintained at that state bank. The term “extraordinary charge”,
23as used in this subsection, is a charge in excess of a fair and
24reasonable charge, based upon the costs to the state bank of
25providing and maintaining checking account services.
26 Sec. 80. Section 524.901, subsection 7, paragraph a,
27subparagraph (2), Code 2021, is amended to read as follows:
28(2) Community development corporations or community
29development projects Public welfare investments to the same
30extent a national bank may invest in such corporations or
31projects pursuant to 12 U.S.C. §24 and its implementing
32regulations.
33 Sec. 81. Section 524.901, subsection 7, paragraph a,
34subparagraph (3), Code 2021, is amended by striking the
35subparagraph.
-50-1 Sec. 82. Section 524.901, subsection 7, paragraph c, Code
22021, is amended by adding the following new subparagraph:
3 NEW SUBPARAGRAPH. (02) The term “public welfare
4investment” means an investment that primarily benefits low
5and moderate-income individuals, low and moderate-income
6areas, or other areas targeted by a governmental entity for
7redevelopment. “Public welfare investment” includes investments
8that primarily support any of the types of activities
9identified in 12 C.F.R. §24.6. “Public welfare investment”
10includes an investment that would receive consideration under
1112 C.F.R. pt.25 as a qualified investment. “Public welfare
12investment” includes an investment in any of the following
13areas:
14(a) A targeted service area as defined in section 8B.1,
15subsection 13.
16(b) A small city as defined in section 15.352, subsection
1710.
18(c) An area of the state that is not part of a federally
19designated standard metropolitan statistical area.
20 Sec. 83. Section 524.901, subsection 8, Code 2021, is
21amended to read as follows:
228. A state bank, in the exercise of the powers granted in
23this chapter, may purchase cash value life insurance contracts
24which may include provisions for the lump sum payment of
25premiums and which may include insurance against the loss of
26the lump sum payment. State banks may only purchase cash
27value life insurance contracts if the contract is tied to an
28employee benefit the state bank is obligated to pay. The cash
29value life insurance contracts, together with the investment in
30annuity contracts authorized in subsection 8A, purchased from
31any one company shall not exceed fifteen percent of aggregate
32capital of the state bank, and in the aggregate from all
33companies, together with the investment in annuity contracts
34authorized in subsection 8A, shall not exceed twenty-five
35percent of aggregate capital of the state bank unless the state
-51-1bank has obtained the approval of the superintendent prior
2to the purchase of any cash value life insurance contract in
3excess of this limitation. Purchase and sale of such contracts
4shall be conducted in accordance with safe and sound banking
5practices.
6 Sec. 84. Section 524.901, Code 2021, is amended by adding
7the following new subsections:
8 NEW SUBSECTION. 8A. A state bank, in the exercise of
9the powers granted in this chapter, may purchase annuity
10contracts so long as the annuity contract is tied to an
11employee benefit the state bank is obligated to pay. The
12total investment in annuity contracts purchased from any
13one company, together with the cash value of life insurance
14contracts authorized in subsection 8, shall not exceed fifteen
15percent of aggregate capital of the state bank, and in the
16aggregate from all companies, together with the cash value of
17life insurance contracts authorized in subsection 8, shall not
18exceed twenty-five percent of aggregate capital of the state
19bank unless the state bank has obtained the approval of the
20superintendent prior to the purchase of any cash value life
21insurance contract in excess of this limitation. Purchase and
22sale of such contracts shall be conducted in accordance with
23safe and sound banking practices.
24 NEW SUBSECTION. 10. A state bank, upon the approval of the
25superintendent, may invest in the shares or equity interests
26of any corporation or other entity which develops or utilizes
27new or innovative technologies that are or may be applicable
28to the provision of banking or other financial products or
29services, including the covered services identified in section
30524.218, subsection 2. A state bank’s total investment in
31any combination of shares or equity interests of the entities
32identified in this paragraph shall not exceed five percent of
33its aggregate capital.
34 Sec. 85. Section 524.904, subsection 2, Code 2021, is
35amended to read as follows:
-52- 12. A state bank may grant loans and extensions of credit to
2one borrower in an amount not to exceed fifteen percent of the
3state bank’s aggregate capital as defined in section 524.103,
4unless the additional lending provisions provision described in
5subsection 3 or 4 apply applies.
6 Sec. 86. Section 524.904, subsection 3, paragraphs a, b, and
7e, Code 2021, are amended by striking the paragraphs.
8 Sec. 87. Section 524.904, subsection 4, Code 2021, is
9amended by striking the subsection.
10 Sec. 88. Section 524.904, subsection 5, paragraph a, Code
112021, is amended to read as follows:
12a. A state bank may grant loans and extensions of credit
13to a borrowing group in an amount not to exceed twenty-five
14percent of the state bank’s aggregate capital if all loans and
15extensions of credit to any one borrower within a borrowing
16group conform to subsection 2 or 3, and the financial strength,
17assets, guarantee, or endorsement of any one borrowing group
18member is not relied upon as a basis for loans and extensions
19of credit to any other borrowing group member. A state bank
20may grant loans and extensions of credit to a borrowing group
21in an amount not to exceed thirty-five percent of aggregate
22capital if all loans and extensions of credit to any one
23borrower within a borrowing group conform to subsection 2,
243, or 4, and the financial strength, assets, guarantee, or
25endorsement of any one borrowing group member is not relied
26upon as a basis for loans and extensions of credit to any
27other borrowing group member. While not to be construed as an
28endorsement of the quality of any loan or extension of credit,
29the superintendent may authorize a state bank to grant loans
30and extensions of credit to a borrowing group in an amount not
31to exceed fifty percent of aggregate capital if all loans and
32extensions of credit to any one borrower within a borrowing
33group conform to subsection 2 or 3, and the financial strength,
34assets, guarantee, or endorsement of any one borrowing group
35member is not relied upon as a basis for loans and extensions
-53-1of credit to any other borrowing group member.
2 Sec. 89. Section 524.905, subsections 2 and 3, Code 2021,
3are amended to read as follows:
42. Protective payments — escrow accounts. A bank may
5include in the loan documents signed by the borrower a
6provision requiring the borrower to pay the bank each month in
7addition to interest and principal under the note an amount
8equal to one-twelfth of the estimated annual real estate
9taxes, special assessments, hazard insurance premium, mortgage
10insurance premium, or any other payment agreed to by the
11borrower and the bank in order to better secure the loan. The
12bank shall be deemed to be acting in a fiduciary capacity with
13respect to these funds. A bank receiving funds in escrow
14pursuant to an escrow agreement executed on or after July 1,
151982 in connection with a loan as defined in section 535.8,
16subsection 1, shall may pay interest to the borrower on those
17funds, calculated on a daily basis, at the rate the bank pays
18to depositors of funds in ordinary savings accounts. A bank
19which maintains an escrow account in connection with any loan
20authorized by this section, whether or not the mortgage has
21been assigned to a third person, shall each year deliver to the
22mortgagor a written annual accounting of all transactions made
23with respect to the loan and escrow account.
243. Escrow reports. A state bank may act as an escrow agent
25with respect to real property, and may receive funds and make
26disbursements from escrowed funds in that capacity. The state
27bank shall be deemed to be acting in a fiduciary capacity with
28respect to these funds. A state bank which maintains such
29an escrow account relating to a mortgage, whether or not the
30mortgage has been assigned to a third person, shall deliver
31to the mortgagor a written summary of all transactions made
32with respect to the loan and escrow accounts during each
33calendar escrow account computation year as defined in 12
34C.F.R. §1024.17. However, the mortgagor and mortgagee may, by
35mutual agreement, select a fiscal year reporting period other
-54-1than the calendar year. The summary shall be delivered or
2mailed not later than thirty days following the escrow account
3computation year to which disclosure relates and shall include
4the information required for annual escrow account statements
5under 12 C.F.R. §1024.17. The summary shall contain all of the
6following information:
7a. The name and address of the mortgagee.
8b. The name and address of the mortgagor.
9c. A summary of escrow account activity during the year as
10follows:
11(1) The balance of the escrow account at the beginning of
12the year.
13(2) The aggregate amount of deposits to the escrow account
14during the year.
15(3) The aggregate amount of withdrawals from the escrow
16account for each of the following categories:
17(a) Payments against loan principal.
18(b) Payments against interest.
19(c) Payments against real estate taxes.
20(d) Payments for real property insurance premiums.
21(e) All other withdrawals.
22(4) The balance of the escrow account at the end of the
23year.
24d. A summary of loan principal for the year as follows:
25(1) The amount of principal outstanding at the beginning of
26the year.
27(2) The aggregate amount of payments against principal
28during the year.
29(3) The amount of principal outstanding at the end of the
30year.
31 Sec. 90. Section 524.910, subsection 2, Code 2021, is
32amended to read as follows:
332. Real property purchased by a state bank at sales upon
34foreclosure of mortgages or deeds of trust owned by it, or
35acquired upon judgments or decrees obtained or rendered for
-55-1debts due it, or real property conveyed to it in satisfaction
2of debts previously contracted in the course of its business,
3or real property obtained by it through redemption as a
4junior mortgagee or judgment creditor, shall be sold or
5otherwise disposed of by the state bank within five years
6after title is vested in the state bank, unless the time is
7extended by the superintendent. This deadline may be extended
8up to an additional five years with prior approval of the
9superintendent, but in no event shall a state bank hold such
10property for more than ten years.
11 Sec. 91. Section 524.1003, subsection 1, paragraph a, Code
122021, is amended to read as follows:
13a. If the superintendent at any time concludes that a state
14bank authorized to act in a fiduciary capacity is managing its
15accounts in an unsafe or unsound manner, or in a manner in
16conflict with the provisions of this chapter, and such state
17bank refuses to correct such practices upon following notice to
18do so, the superintendent may forthwith direct that the state
19bank cease to act as a fiduciary and proceed to resign its
20fiduciary positions.
21 Sec. 92. Section 524.1003, subsection 1, paragraph b, Code
222021, is amended by striking the paragraph and inserting in
23lieu thereof the following:
24b. After directing the state bank to cease to act as a
25fiduciary, the superintendent shall file a petition in the
26district court of Polk county setting forth in general terms
27that the state bank is acting as fiduciary with respect to
28certain property and that it is necessary and desirable that
29successor fiduciaries be appointed for such property.
30 Sec. 93. Section 524.1003, subsection 1, Code 2021, is
31amended by adding the following new paragraphs:
32 NEW PARAGRAPH. c. Following the filing of a petition
33pursuant to paragraph “b” by the superintendent, the district
34court shall issue an order requiring all persons interested
35in the state bank’s fiduciary accounts to appoint a successor
-56-1fiduciary by a specific date, acknowledge the fiduciary
2succession as described in the will, trust instrument, or
3other governing instrument of the fiduciary account, or show
4cause why the district court should not appoint a successor
5fiduciary. Such order may also appoint a temporary fiduciary
6for the fiduciary accounts held by the state bank who shall
7be obligated to take possession of the fiduciary accounts
8and perform necessary tax, investment, distribution, asset
9protection, and reporting obligations required of the fiduciary
10accounts and perform necessary tax, investment, distribution,
11asset protection, and reporting obligations required of the
12fiduciary until a permanent successor is appointed. Neither
13the temporary nor permanent successor fiduciary shall be
14liable for the actions of the state bank and shall not be
15responsible for reviewing the action or inaction of the
16preceding fiduciary. The state bank’s liability for any action
17or inaction in its former fiduciary positions shall not be
18impacted by the transfer of fiduciary duties pursuant to this
19section. The district court may assess the fees and costs of
20the temporary fiduciary against the state bank.
21 NEW PARAGRAPH. d. Following the appointment of a temporary
22fiduciary, the district court shall enter an order directing
23the temporary fiduciary to provide notice of the petition
24and the order described in this section, through a means
25approved by the district court, to all persons shown in the
26records of the state bank to have a beneficial interest in
27the fiduciary accounts or entitled to notice or an accounting
28under the terms of the will, trust instrument, or other
29governing instrument of the fiduciary account, chapter 633,
30633A, 633B, or other applicable statute under which the state
31bank has been operating as a fiduciary. The district court
32may also order publication of the notice for two consecutive
33weeks in newspapers of general circulation in one or more
34counties as prescribed by the district court, and publication
35on the temporary fiduciary’s internet site for at least twenty
-57-1days, to the extent the district court deems such published
2notice necessary to protect the interests of absent or remote
3beneficiaries.
4 Sec. 94. Section 524.1003, subsection 2, Code 2021, is
5amended by striking the subsection and inserting in lieu
6thereof the following:
72. At least twenty days after providing notice of a petition
8and order appointing the temporary fiduciary as described in
9this section, the district court shall appoint a permanent
10successor fiduciary for any fiduciary account where appropriate
11parties have failed to cause a successor fiduciary to be
12appointed. A successor fiduciary appointed in accordance with
13the terms of this section shall succeed to all the rights,
14powers, titles, duties, and responsibilities of the state bank
15except that the successor fiduciary shall not exercise the
16powers given in the instrument creating the powers that by
17its express terms are personal to the state bank previously
18designated and except claims or liabilities arising out of the
19management of the fiduciary account prior to the date of the
20transfer.
21 Sec. 95. Section 524.1004, Code 2021, is amended by striking
22the section and inserting in lieu thereof the following:
23524.1004 Voluntary relinquishment of fiduciary capacity.
241. A state bank desiring to completely surrender its
25authorization to act in any fiduciary capacity shall file with
26the superintendent a certified copy of a resolution by the
27board of directors signifying such intent.
282. Following the filing with the superintendent of the
29resolution to surrender its authorization to act in a fiduciary
30capacity, the state bank shall file a petition in the district
31court in which the state bank has its principal place of
32business setting forth in general terms that the state bank is
33acting as fiduciary with respect to certain property, that the
34state bank desires to cease its fiduciary function and resign
35its fiduciary positions, and that it is necessary and desirable
-58-1that successor fiduciaries be appointed for such property.
23. The filing of the petition shall operate as a resignation
3of the state bank from all of its fiduciary positions. During
4the adjudication of the petition, the state bank shall retain
5all fiduciary rights, powers, titles, duties, responsibilities,
6and accounts it held prior to filing the petition. The state
7bank’s liability for any action or inaction in its former
8fiduciary positions shall not be impacted by the transfer of
9fiduciary duties pursuant to this section.
104. Following the filing of the petition, the district
11court shall issue an order requiring all persons interested
12in such fiduciary accounts to appoint a successor fiduciary
13by a specific date, acknowledge the fiduciary succession as
14described in the will, trust instrument, or other governing
15instrument of the fiduciary account, or show cause why the
16district court should not appoint a successor fiduciary. The
17district court shall also enter an order directing the state
18bank to provide notice of the petition and the order described
19in this section, through a means approved by the district
20court, to all persons shown in the records of the state bank
21to have a beneficial interest in the fiduciary accounts or
22entitled to notice or an accounting under the terms of the
23will, trust instrument, or other governing instrument of the
24fiduciary account, chapter 633, 633A, 633B, or other applicable
25statute under which the state bank has been operating as a
26fiduciary. The district court may also order publication of
27the notice for two consecutive weeks in newspapers of general
28circulation in one or more counties as prescribed by the
29district court, and publication on the state bank’s internet
30site for at least twenty days, to the extent the district court
31deems such published notice necessary to protect the interests
32of absent or remote beneficiaries.
335. At least twenty days after the state bank provides notice
34of the petition and order as described in this section, the
35district court shall appoint a permanent successor fiduciary
-59-1for any fiduciary account where appropriate parties have
2failed to cause a successor fiduciary to be appointed. A
3successor fiduciary appointed in accordance with the terms of
4this section shall succeed to all the rights, powers, titles,
5duties, and responsibilities of the state bank except that the
6successor fiduciary shall not exercise powers given in the
7instrument creating the powers that by its express terms are
8personal to the state bank previously designated and except
9claims or liabilities arising out of the management of the
10fiduciary account prior to the date of the transfer.
116. Following the adjudication of the petition described
12in this section, the state bank shall proceed to amend its
13articles of incorporation, in accordance with the provisions
14of this chapter, in a manner to indicate that it is no longer
15authorized to act in a fiduciary capacity. The superintendent
16shall approve the proposed amendment, in the manner provided
17for in this chapter, if the superintendent is satisfied that
18the state bank has properly relieved itself of its fiduciary
19responsibilities.
20 Sec. 96. NEW SECTION. 524.1005A Nonresident corporate
21fiduciaries.
22An out-of-state bank or a trust company chartered or
23organized under the laws of another state may only act
24in a fiduciary capacity in this state if it satisfies the
25requirements for nonresident corporate fiduciaries pursuant to
26section 633.64.
27 Sec. 97. Section 524.1007, Code 2021, is amended by striking
28the section and inserting in lieu thereof the following:
29524.1007 Succession of fiduciary accounts to another
30financial institution.
311. A state bank or other entity authorized to act in
32a fiduciary capacity may enter into an agreement for the
33succession of any fiduciary accounts with one or more other
34banks or trust companies, including trust companies organized
35under the laws of another state, that are authorized to act in
-60-1a fiduciary capacity under the laws of this state, the laws
2of another state, or a national bank to the extent permitted
3by the laws of the United States. In the agreement, the
4succeeding bank or trust company may agree to succeed the
5relinquishing bank or trust company as a fiduciary to those
6fiduciary accounts which are designated in the agreement. The
7designation of accounts may be by general class or description
8and may include fiduciary accounts subject and not subject to
9court administration and fiduciary accounts to arise in the
10future under wills, trusts, court orders, or other documents
11under which the relinquishing bank or trust company is named
12as a fiduciary or is named to become a fiduciary upon the death
13of a testator or settlor or upon the happening of any other
14subsequent event.
152. The relinquishing bank or trust company shall provide,
16at least twenty days preceding the effective date for the
17succession of the fiduciary accounts, notice of the pending
18succession, as required by chapter 633, 633A, 633B, or any
19other applicable chapter, to all persons shown in the records
20of the relinquishing bank or trust company to have a beneficial
21interest in the fiduciary accounts or entitled to notice or an
22accounting under the terms of the will, trust instrument, or
23other governing instrument of the fiduciary account, chapter
24633, 633A, or 633B, or other applicable statute under which
25the relinquishing bank or trust company has been operating as
26a fiduciary. In order to account for unknown or prospective
27appointments, the relinquishing bank or trust company shall
28publish a notice of the succession to fiduciary accounts in a
29newspaper published in the county of the principal place of
30business of the relinquishing bank or trust company, and the
31notice must be published on the relinquishing bank or trust
32company’s internet site for at least twenty days preceding the
33effective date of the agreement for the succession of fiduciary
34accounts. For any fiduciary accounts that are employee benefit
35plans, the relinquishing bank or trust company may satisfy this
-61-1subsection by sending the required notice to the plan sponsors.
23. Following the publication and notice described in
3this section, the succeeding bank or trust company shall, on
4the effective date of the agreement for the succession of
5fiduciary accounts and without further notice, approval, or
6authorization, succeed to the relinquishing bank or trust
7company as to the fiduciary accounts and the fiduciary powers,
8rights, privileges, duties, and liabilities for the fiduciary
9accounts. On the effective date of the succession to fiduciary
10accounts, the relinquishing bank or trust company is released
11from the fiduciary duties under the fiduciary accounts and
12shall discontinue its exercise of fiduciary powers over the
13fiduciary accounts. Notice of such fiduciary succession
14shall be filed of record for each parcel of real estate in
15this state subject to such fiduciary succession unless all
16of the fiduciary accounts held by the relinquishing bank or
17trust company are subject to the agreement for succession
18of fiduciary accounts, in which case the relinquishing bank
19or trust company shall file notice of the succession in the
20county recorder’s office of all counties in which the fiduciary
21accounts of the relinquishing bank or trust company owned real
22estate prior to the effective date of the agreement. This
23subsection does not absolve a relinquishing bank or trust
24company from liabilities arising out of a breach of fiduciary
25duty occurring prior to the effective date of the succession
26to fiduciary accounts.
274. Within sixty days after the mailing and publication of
28the notice, a person with an interest in a fiduciary account
29included within the notice and agreement required by subsection
301 may apply to the district court in the county in which the
31notice is published for the appointment of a new fiduciary on
32the ground that the succeeding fiduciary will adversely affect
33the administration of the fiduciary account. After notice to
34all interested parties and a hearing on the issues, the court
35may appoint a new fiduciary to replace the succeeding fiduciary
-62-1if it finds that the substitution of the succeeding fiduciary
2will adversely affect the administration of the account and
3that the appointment of a new fiduciary would be in the best
4interests of the beneficiaries of the fiduciary account. This
5subsection is in addition to section 633.65 and any other
6applicable provision governing the removal of a fiduciary.
75. The privilege of succeeding to fiduciary accounts that
8is extended to a state bank or trust company by this section is
9also extended on the same terms and conditions to a national
10bank organized under 12 U.S.C. §21 et seq.to engage generally
11in the banking business, and to out-of-state banks and trust
12companies that are authorized to serve as a fiduciary in this
13state pursuant to section 633.64.
146. For a fiduciary account governed by Iowa law, a
15relinquishing bank or trust company may transfer the situs of
16the fiduciary account to a jurisdiction other than Iowa if the
17will, trust instrument, or other governing instrument of the
18fiduciary account so provides, if all persons interested in
19the fiduciary account consent to the transfer, or as otherwise
20authorized by applicable law.
21 Sec. 98. Section 524.1009, Code 2021, is amended to read as
22follows:
23524.1009 Succession to fiduciary accounts and appointments —
24application for appointment of new fiduciary merger.
251. If a party to a plan of merger was authorized to act in a
26fiduciary capacity and if the resulting state or national bank
27is similarly authorized, the resulting state or national bank
28shall be automatically substituted by reason of the merger as
29fiduciary of all accounts held in that capacity by such party
30to the plan of merger, without further action and without any
31order or decree of any court or public officer, and shall have
32all the rights and be subject to all the obligations of such
33party as fiduciary.
342. No designation, nomination, or appointment as fiduciary
35of a party to a plan of merger shall lapse by reason of the
-63-1merger. The resulting state or national bank, if authorized
2to act in a fiduciary capacity, shall be entitled to act
3as fiduciary pursuant to each designation, nomination, or
4appointment to the same extent as the party to the plan of
5merger so named could have acted in the absence of the merger.
62A. The relinquishing bank shall provide, at least twenty
7days preceding the effective date for the succession of
8the fiduciary accounts, notice of the pending succession,
9as required by chapter 633, 633A, 633B, or any other
10applicable chapter, to all persons shown in the records of
11the relinquishing bank to have a beneficial interest in the
12fiduciary accounts or entitled to notice or an accounting under
13the terms of the will, trust instrument, or other governing
14instrument of the fiduciary account, chapter 633, 633A, or
15633B, or other applicable statute under which the relinquishing
16bank has been operating as a fiduciary. In order to account
17for unknown or prospective appointments, the relinquishing bank
18shall publish a notice of the succession to fiduciary accounts
19in a newspaper published in the county of the principal place
20of business of the relinquishing bank, and the notice must be
21published on the relinquishing bank’s internet site for at
22least twenty days preceding the effective date of the merger.
23For any fiduciary accounts that are employee benefit plans, the
24relinquishing bank may satisfy this subsection by sending the
25required notice to the plan sponsors.
263. Any person with an interest in an account held in a
27fiduciary capacity by a party to a plan of merger may, within
28sixty days after the effective date of the merger the mailing
29and publication of the notice, apply to the district court in
30the county in which the resulting state or national bank has
31its principal place of business, notice is published for the
32appointment of a new fiduciary to replace the resulting state
33or national bank on the ground that the merger will adversely
34affect the administration of the fiduciary account. The court
35shall have the discretion to appoint a new fiduciary to replace
-64-1the resulting state or national bank if it should find, upon
2hearing after notice to all interested parties, that the merger
3will adversely affect the administration of the fiduciary
4account and that the appointment of a new fiduciary will be
5in the best interests of the beneficiaries of the fiduciary
6account. This provision is in addition to any other provision
7of law governing the removal of fiduciaries and is subject to
8the terms upon which the party to the plan of merger which held
9the fiduciary account was designated as fiduciary.
104. The resulting bank shall record a copy of the articles
11of merger in the county recorder’s office of all counties in
12which the fiduciary accounts of the relinquishing bank owned
13real estate prior to the effective date of the merger.
14 Sec. 99. Section 524.1106, Code 2021, is amended to read as
15follows:
16524.1106 Fees paid to an affiliate — approval by
17superintendent.
18Any contract or arrangement for management or financial
19services which involves payment for these services by a state
20bank to a person who owns shares in that state bank, or to any
21other affiliate, must be approved by the superintendent prior
22to such contract or arrangement becoming binding upon the state
23bank made in compliance with 12 U.S.C. §371c and 12 U.S.C.
24§371c-1, and may also be reviewed by the superintendent at any
25time after original approval. Any contract or arrangement for
26consultation or other services which involve payment of those
27services by a state bank to any person who individually or
28whose spouse or immediate family or any combination thereof
29owns fifteen percent or more of the outstanding shares of
30that state bank or is an officer or director thereof, or to
31an affiliate may be reviewed by the superintendent. Fees
32paid to an affiliate must be substantially the same as those
33prevailing at the time for comparable transactions involving
34nonaffiliated companies in accordance with the provisions of
3512 U.S.C. §371c-1. The superintendent shall have authority to
-65-1determine whether or not such fees are reasonable in relation
2to the services performed, and if the superintendent determines
3they are unreasonable, to require that they be reduced to a
4reasonable amount or eliminated and the excess refunded, or
5that such contract or arrangement not be entered into by the
6state bank.
7 Sec. 100. Section 524.1201, Code 2021, is amended to read
8as follows:
9524.1201 General provisions.
101. A state bank may establish and operate any number of bank
11offices at any location in this state subject to the approval
12and regulation of the superintendent. The superintendent
13shall supervise and regulate all out-of-state branches and
14offices of a state bank. A bank office may furnish all banking
15services ordinarily furnished to customers and depositors
16at the principal place of business of the state bank which
17operates the office, and a bank office manager or an officer
18of the bank shall be physically present at each bank office
19during a majority of its business hours. The central executive
20and official business and principal recordkeeping functions of
21a state bank shall be exercised only at its principal place
22of business or at another bank office as authorized by the
23superintendent for these functions.
242. Notwithstanding subsection 1, data Data processing
25services referred to in section 524.804 may be performed for
26the state bank at some other secure location. All transactions
27of a bank office shall be immediately transmitted to the
28principal place of business or other bank office authorized
29under subsection 1 of the state bank which operates the office,
30and no current recordkeeping functions shall be maintained
31at a bank office other than the bank office authorized under
32subsection 1, except to the extent the state bank which
33operates the office deems it desirable to keep there duplicates
34of the records kept at the principal place of business or
35authorized bank office of the state bank.
-66- 13. Notwithstanding any of the other provisions of this
2section, original loan documentation and trust recordkeeping
3functions may be located at any authorized bank office or at
4any other secure location approved by the superintendent.
5 Sec. 101. Section 524.1206, Code 2021, is amended to read
6as follows:
7524.1206 Identification of legally chartered name of bank —
8required use of name.
9A state or national bank, at its locations in this state,
10shall identify its principal place of business, any bank
11office, or any bank branch in a manner which includes its
12legally chartered name or a reasonable variation of such name.
13A bank doing business in this state electronically shall
14identify its legally chartered name in any online, mobile, or
15digital customer interface. The legally chartered name of the
16state bank, out-of-state bank, or national bank shall be used
17in all legal documents of such bank.
18 Sec. 102. Section 524.1301, unnumbered paragraph 1, Code
192021, is amended to read as follows:
20A majority of the incorporators, organizers, or initial
21directors of a state bank that has not issued shares or has not
22commenced business may dissolve the state bank by delivering
23articles of dissolution to the superintendent, together with
24the applicable filing and recording fees, for filing with the
25secretary of state that set forth all of the following:
26 Sec. 103. Section 524.1303, subsection 2, Code 2021, is
27amended to read as follows:
282. Upon acceptance for processing of an application for
29approval of a plan of dissolution on forms prescribed by
30the superintendent, the superintendent shall conduct such
31investigation as the superintendent may deem necessary to
32determine whether the plan of dissolution adequately protects
33the interests of depositors, other creditors, and shareholders
34and, if the plan of dissolution involves an acquisition of
35assets and assumption of liabilities by another state bank,
-67-1whether such acquisition and assumption would be consistent
2with adequate and sound banking and in the public interest, on
3the basis of factors substantially similar to those set forth
4in section 524.1403, subsection 1, paragraph “d”.
5 Sec. 104. Section 524.1303, subsections 3, 4, 5, and 6, Code
62021, are amended by striking the subsections.
7 Sec. 105. Section 524.1304, subsection 2, Code 2021, is
8amended to read as follows:
92. Upon approval of the plan of voluntary dissolution by
10the superintendent, the superintendent shall file with the
11secretary of state articles of dissolution prepared by the
12applicant in conformance with section 524.1304A. Upon filing
13of the articles of dissolution with the secretary of state,
14the state bank shall cease to accept deposits or carry on its
15business, except insofar as may be necessary for the proper
16winding up of the business of the state bank in accordance
17with the approved plan of dissolution. Upon request, the
18superintendent shall expressly revoke the authorization to
19do business of any state bank that has voluntarily dissolved
20pursuant to this section and shall return the physical copy
21of such state bank’s authorization to do business in a manner
22clearly indicating that the authorization has been revoked.
23 Sec. 106. Section 524.1305, subsection 1, paragraph d, Code
242021, is amended to read as follows:
25d. Distributing Making distributions of its remaining
26property assets among its shareholders according to their
27interests.
28 Sec. 107. Section 524.1305, subsection 2, paragraph d, Code
292021, is amended to read as follows:
30d. Changing quorum any of the following:
31(1) Quorumor voting requirements for its board of directors
32or shareholders; changing provisions.
33(2) Provisionsfor selection, resignation, or removal of
34its directors or officers or both; or changing provisions.
35(3) Provisionsfor amending its bylaws.
-68-1 Sec. 108. Section 524.1305, subsection 3, paragraphs a, b,
2and d, Code 2021, are amended to read as follows:
3a. By mail to each depositor and creditor, except those as
4to whom the liability of the state bank has been assumed by
5another financial institution insured by the federal deposit
6insurance corporation pursuant to the plan of dissolution, at
7their last address of record as shown upon the books of the
8state bank, including a statement of the amount shown by the
9books of the state bank to be due to such depositor or creditor
10and a demand that any claim for a greater amount be filed with
11the state bank any time before a specified date at least ninety
12days after the date of the notice.
13b. By mail to each lessee of a safe-deposit box and each
14customer for whom property is held in safekeeping, except those
15as to whom the liability of the state bank has been assumed by
16another financial institution insured by the federal deposit
17insurance corporation pursuant to the plan of dissolution,
18at their last address of record as shown upon the books of
19the state bank, including a demand that all property held in
20a safe-deposit box or held in safekeeping by the state bank
21be withdrawn by the person entitled to the property before a
22specified date which is at least ninety days after the date of
23the notice.
24d. By a conspicuous posting at each office of the state
25bank and by posting on the state bank’s internet site for
26at least thirty days following the filing of the articles of
27dissolution.
28 Sec. 109. Section 524.1306, subsection 2, Code 2021, is
29amended to read as follows:
302. The statement of revocation of voluntary dissolution
31proceedings, whether by consent of shareholders or by act of
32the state bank, shall be delivered to the superintendent,
33together with the applicable filing and recording fee, who
34shall, if the superintendent finds that they satisfy the
35requirements of this section, deliver them to the secretary
-69-1of state for filing and recording in the secretary of state’s
2office, and the same shall be filed and recorded in the office
3of the county recorder.
4 Sec. 110. Section 524.1308A, Code 2021, is amended by adding
5the following new subsection:
6 NEW SUBSECTION. 5. As used in this section, the term
7“notice” means as defined in section 490.141.
8 Sec. 111. Section 524.1308B, subsection 2, unnumbered
9paragraph 1, Code 2021, is amended to read as follows:
10A The notice made pursuant to this section must satisfy all
11of the following requirements:
12 Sec. 112. Section 524.1308B, subsection 2, paragraph a,
13Code 2021, is amended to read as follows:
14a. Be published at least once in accordance with all of the
15following:
16(1) One timein a newspaper of general circulation in the
17county where the dissolved state bank’s principal office is or
18was located.
19(2) Be posted conspicuously for at least thirty days on the
20dissolved state bank’s internet site.
21 Sec. 113. Section 524.1309, Code 2021, is amended to read
22as follows:
23524.1309 Becoming subject to chapter 489 or 490.
24In lieu of the dissolution procedure prescribed in sections
25524.1303 through 524.1306, a state bank may cease to carry
26on the business of banking and, after compliance with this
27section, continue as a corporation subject to chapter 490; or
28if the state bank is organized as a limited liability company
29under this chapter, continue as a limited liability company
30subject to chapter 489.
311. A state bank that has commenced business may propose
32to voluntarily cease to carry on the business of banking and
33become a corporation subject to chapter 490, or a limited
34liability company subject to chapter 489, upon the affirmative
35vote of the holders of at least a majority of the shares
-70-1entitled to vote on such proposal, adopting a plan involving
2both a provision for acquisition of its assets and assumption
3of its liabilities by another state bank, national bank, or
4other financial institution insured by the federal deposit
5insurance corporation, and a provision for continuance of
6its business if acquisition of its assets and assumption of
7its liabilities is not effected, or any other plan providing
8for the cessation of banking business and the payment of its
9liabilities.
102. The application to the superintendent for approval
11of a plan described in subsection 1 shall be treated by
12the superintendent in the same manner as an application for
13approval of a plan of dissolution under section 524.1303,
14subsection 2, and shall be subject to section 524.1303,
15subsection 3 524.1305, subsections 8 and 9.
163. Immediately upon adoption and approval of a plan to
17voluntarily cease to carry on the business of banking and
18become a corporation subject to chapter 490, or a limited
19liability company subject to chapter 489 the state bank
20shall submit an application for the required approval by the
21superintendent in the manner prescribed by the superintendent.
22As part of this application, the state bank shall deliver to
23the superintendent a plan to cease the business of banking
24and become a corporation subject to chapter 490, or a limited
25liability company subject to chapter 489, which shall be
26signed by two of its duly authorized officers and shall
27contain the name of the state bank, the post office address
28of its principal place of business, the name and address of
29its officers and directors, the number of shares entitled
30to vote on the plan and the number of shares voted for or
31against the plan, respectively, the nature of the business
32to be conducted by the corporation under chapter 490, or by
33the limited liability company subject to chapter 489, and the
34general nature of the assets to be held by the corporation or
35company. As part of the application, the state bank shall
-71-1also deliver to the superintendent articles of intent to be
2subject to chapter 490, together with the applicable filing
3fees, which shall set forth that the state bank has complied
4with this section, that it intends to cease to carry on the
5business of banking, and the information required by section
6490.202 relative to the contents of articles of incorporation
7under chapter 490.
84. Upon approval of the plan by the superintendent, the
9state bank shall immediately surrender to the superintendent
10its authorization to do business as a bank and shall cease
11to accept deposits and carry on the banking business except
12insofar as may be necessary for it to complete the settlement
13of its affairs as a state bank in accordance with subsection
145. Upon request, the superintendent shall expressly revoke
15the state bank’s authorization to do business and return the
16physical copy of such state bank’s authorization to do business
17in a manner clearly indicating that the authorization has been
18revoked.
195. The board of directors has full power to complete the
20settlement of the affairs of the state bank. Within thirty
21days after approval by the superintendent of the plan to cease
22the business of banking and become a corporation subject
23to chapter 490, or a limited liability company subject to
24chapter 489, the state bank shall give notice of its intent
25to persons identified in section 524.1305, subsection 3, in
26the manner provided for in that subsection. In completing
27the settlement of its affairs as a state bank, the state bank
28shall also follow the procedure prescribed in section 524.1305,
29subsections 4, 5, and 6.
306. Upon completion of all the requirements of this section,
31the state bank shall deliver to the superintendent articles of
32intent to be subject to chapter 490 or 489, together with the
33applicable filing and recording fees, which shall set forth
34that the state bank has complied with this section, that it has
35ceased to carry on the business of banking, and the information
-72-1required by section 490.202 relative to the contents of
2articles of incorporation under chapter 490, or articles of
3organization under chapter 489. If the superintendent finds
4that the state bank has complied with all requirements of
5 this section and that the articles of intent to be subject to
6chapter 490 or 489 satisfy the requirements of this section,
7the superintendent shall deliver them to the secretary of state
8for filing and recording in the secretary of state’s office,
9and the superintendent shall file and record them in the office
10of the county recorder.
117. Upon the filing of the articles of intent to be subject
12to chapter 490 or 489, the state bank shall immediately
13 cease to be a state bank subject to this chapter, and shall
14immediately cease to have the powers of a state bank subject
15to this chapter and shall become a corporation subject to
16chapter 490 or a limited liability company subject to chapter
17489. The secretary of state shall issue a certificate as to
18the filing of the articles of intent to be subject to chapter
19490 or 489 and send the certificate to the corporation or
20limited liability company or its representative. The articles
21of intent to be subject to chapter 490 or 489 shall be the
22articles of incorporation of the corporation or a limited
23liability company. The provisions of chapter 490 or 489
24 becoming applicable to a corporation or limited liability
25company formerly doing business as a state bank shall not
26affect any right accrued or established, or liability or
27penalty incurred under this chapter prior to the filing with
28the secretary of state of the articles of intent to be subject
29to chapter 490 or 489.
308. A shareholder of a state bank who objects to adoption
31by the state bank of a plan to cease to carry on the business
32of banking and to continue as a corporation subject to chapter
33490, or a limited liability company subject to chapter 489,
34 is entitled to appraisal rights provided for in chapter 490,
35subchapter XIII, or in chapter 489, section 489.604.
-73- 19. A state bank, at any time prior to the approval of the
2articles of intent to become subject to chapter 490 or 489,
3may revoke the proceedings in the manner prescribed by section
4524.1306.
5 Sec. 114. Section 524.1310, subsection 1, paragraph a, Code
62021, is amended to read as follows:
7a. In a situation in which the superintendent has required,
8in accordance with section 524.226 524.224, that the state
9bank cease to carry on its business, the superintendent shall
10immediately tender to the federal deposit insurance corporation
11the receivership for the state bank. The affairs of the state
12bank shall thereafter be governed by this section, section
13524.1311, and the provisions of federal law, and shall be
14subject to federal court jurisdiction, and the assets of the
15state bank shall be distributed in accordance with section
16524.1312. If there is a conflict between the provisions of
17state and federal law, federal law shall govern.
18 Sec. 115. Section 524.1311, subsection 2, Code 2021, is
19amended to read as follows:
202. After the involuntary dissolution of a state bank, the
21superintendent shall file notice of the dissolution with the
22secretary of state and the county recorder of the county in
23which the state bank is located. No fee shall be charged by
24the secretary of state or the county recorder for the filing
25or recording. The corporate existence of the state bank
26shall cease upon filing of the notice of dissolution with the
27secretary of state.
28 Sec. 116. Section 524.1401, Code 2021, is amended to read
29as follows:
30524.1401 Authority to merge.
311. Upon compliance with the requirements of this chapter,
32one or more state banks, one or more out-of-state banks, one or
33more national banks, one or more federal savings associations,
34one or more corporations, or any combination of these entities,
35with the approval of the superintendent, may merge into a state
-74-1bank pursuant to a plan of merger.
22. Upon compliance with the requirements of this chapter,
3one or more state banks may merge into a national bank, federal
4savings association, or out-of-state bank. The authority of
5a state bank to merge into a national bank or federal savings
6association is subject to the condition that at the time of the
7transaction the laws of the United States shall authorize a
8national bank or federal savings association located in this
9state, without approval by the comptroller of the currency of
10the United States, to merge into a state bank under limitations
11no more restrictive than those contained in this chapter with
12respect to the merger of a state bank into a national bank or
13federal savings association. The authority of a state bank to
14merge into an out-of-state bank is subject to the condition
15that at the time of the transaction the laws of the home state
16of the resulting bank shall authorize a bank organized under
17the laws of such home state, without approval by the home
18state’s bank regulatory authority, to merge into a state bank
19under limitations no more restrictive than those contained in
20this chapter with respect to the merger of a state bank into an
21out-of-state bank.
223. Upon compliance with the requirements of this chapter,
23one or more state banks may merge with one or more federal
24associations. The authority of a state bank to merge into a
25federal association is subject to the conditions the laws of
26the United States authorize at the time of the transaction.
274. 3. As used in this section, the term “merger” or “merge”
28means any plan by which the assets and liabilities of an
29entity are combined with those of one or more other entities,
30including transactions in which one of the corporate entities
31survives and transactions in which a new corporate entity is
32created.
33 Sec. 117. Section 524.1402, Code 2021, is amended to read
34as follows:
35524.1402 Requirements for a merger.
-75- 1The requirements for a merger which must be satisfied by the
2parties to the merger are as follows:
31. The parties shall adopt a plan stating of merger which
4must include all of the following:
5a. The names of the parties proposing to merge and the name
6of the bank into which they propose to merge, which is the
7“resulting bank”.
8a. As to each party to the merger, the party’s name,
9jurisdiction of formation, and type of entity.
10b. The resulting bank’s name, jurisdiction of formation, and
11type of entity, and, if the resulting bank is to be created in
12the merger, a statement to that effect.
13b. c. The terms and conditions of the proposed merger.
14c. d. The manner and basis of converting the shares of each
15party into any combination of shares, obligations, or other
16securities of the resulting bank or of any other corporation,
17or, in whole or in part, into cash or other property,
18obligations, rights to acquire shares or other securities,
19cash, or other property.
20d. e. The rights of the shareholders of each of the
21parties.
22e. f. An agreement concerning the merger.
23f. g. Such other provisions with respect to the proposed
24merger which are deemed necessary or desirable.
252. In the case of a state bank which is a party to the
26plan of merger, if the proposed merger will result in a state
27bank subject to this chapter, adoption of the plan of merger
28 by such state bank requires the affirmative vote of at least
29a majority of the directors and approval by the shareholders,
30in the manner and according to the procedures prescribed in
31section 490.1104, at a meeting called in accordance with
32the terms of that section. In the case of a national bank,
33or if the proposed merger will result in a national bank,
34adoption of the plan of merger by each party to the merger
35shall require the affirmative vote of at least such directors
-76-1and shareholders whose affirmative vote on the plan of merger
2 is required under the laws of the United States. Subject to
3applicable requirements of the laws of the United States in a
4case in which a national bank is a party to a plan of merger,
5any modification of a plan of merger which has been adopted
6shall be made by any method provided in the plan of merger, or
7in the absence of such provision, by the same vote as required
8for adoption.
93. If a proposed merger will result in a state bank,
10application for the required approval by the superintendent
11shall be made in the manner prescribed by the superintendent.
12There shall also be delivered to the superintendent, when
13available, the following:
14a. Articles of merger.
15b. Applicable fees payable to the secretary of state, as
16specified in section 490.122, for the filing and recording of
17the articles of merger.
18c. If there is any modification of the plan of merger at
19any time prior to the approval by the superintendent under
20section 524.1403, an amendment of the application and, if
21necessary, of the articles of merger, signed in the same manner
22as the originals, setting forth the modification of the plan of
23merger, the method by which the modification was adopted and
24any related change in the provisions of the articles of merger.
25d. Proof of publication of the notice required by subsection
264.
274. If a proposed merger will result in a state bank, within
28thirty days after the application for merger is accepted for
29processing, the parties to the plan shall publish a notice of
30the proposed transaction in a newspaper of general circulation
31published in the municipal corporation or unincorporated
32area in which each party to the plan has its principal place
33of business, or if there is none, in a newspaper of general
34circulation published in the county, or in a county adjoining
35the county, in which each party to the plan has its principal
-77-1place of business. The notice shall be on forms prescribed by
2the superintendent and shall set forth the names of the parties
3to the plan and the resulting state bank, the location and
4post office address of the principal place of business of the
5resulting state bank and of each office to be maintained by
6the resulting state bank, and the purpose or purposes of the
7resulting state bank. Proof of publication of the notice shall
8be delivered to the superintendent within fourteen days.
95. Within thirty days after the date of the publication of
10the notice required under subsection 4, any interested person
11may submit to the superintendent written comments and data
12on the application. Comments challenging the legality of an
13application shall be submitted separately in writing. The
14superintendent may extend the thirty-day comment period if, in
15the superintendent’s judgment, extenuating circumstances exist.
166. Within thirty days after the date of the publication
17of the notice required under subsection 4, any interested
18person may submit to the superintendent a written request for a
19hearing on the application. The request shall state the nature
20of the issues or facts to be presented and the reasons why
21written submissions would be insufficient to make an adequate
22presentation to the superintendent. If the reasons are related
23to factual disputes, the disputes shall be described. Written
24requests for hearings shall be evaluated by the superintendent,
25who may grant or deny such requests in whole or in part. A
26hearing request shall generally be granted only if it is
27determined that written submissions would be inadequate or that
28a hearing would otherwise be beneficial to the decision-making
29process. A hearing may be limited to issues considered
30material by the superintendent.
317. If a request for a hearing is denied, the superintendent
32shall notify the applicant and all interested persons and
33shall state the reasons for the denial. Interested persons
34may submit to the superintendent, with simultaneous copies
35to the applicant, additional written comments or data on the
-78-1application within fourteen days after the date of the notice
2of denial. The applicant shall be provided an additional seven
3days, after the fourteen-day deadline has expired, within which
4to respond to any comments submitted within the fourteen-day
5period. The superintendent may waive this seven-day period
6upon request by the applicant. A copy of any response
7submitted by the applicant shall also be mailed simultaneously
8by the applicant to the interested persons.
98. 4. The articles of merger shall be signed by two a duly
10authorized officers officer of each party to the plan of merger
11 and shall contain all of the following:
12a. The names name, jurisdiction of formation, and type
13of entity of the parties each party to the plan, and of the
14resulting state bank of merger.
15b. The name, jurisdiction of formation, and type of entity
16of the resulting state bank.
17b. c. The location and the post office address of the
18principal place of business of each party to the plan of
19merger, and of each additional office maintained by the parties
20to the plan of merger, and the location and post office address
21of the principal place of business of the resulting state bank,
22and of each additional office to be maintained by the resulting
23state bank.
24c. d. The votes by which the plan of merger was adopted,
25and the date and place of each meeting in connection with such
26adoption.
27d. e. The number of directors constituting the board of
28directors, and the names and addresses of the individuals who
29are to serve as directors until the next annual meeting of the
30shareholders or until their successors be elected and qualify.
31e. f. Any amendment of the articles of incorporation of the
32resulting state bank.
33f. The plan of merger.
349. 5. If a proposed merger will result in a national bank,
35federal savings association, or out-of-state bank, a state bank
-79-1which is a party to the plan of merger shall do all of the
2following:
3a. Notify the superintendent of the proposed merger.
4b. Provide such evidence of the adoption of the plan of
5merger as the superintendent may request.
6c. Notify the superintendent of any abandonment or
7disapproval of the plan of merger.
8d. File with the superintendent and with the secretary of
9state evidence of approval of the merger by the comptroller
10of the currency of the United States if the merger results
11in a national bank or federal savings association, or the
12approval of the merger by the home state chartering authority
13of the resulting out-of-state bank if the merger results in an
14out-of-state bank.
15e. Notify the superintendent of the date upon which the
16merger is to become effective.
17 Sec. 118. Section 524.1403, Code 2021, is amended to read
18as follows:
19524.1403 Approval of merger by superintendent.
201. Upon receipt of an application for approval of a
21merger and of the supporting items required by section
22524.1402, subsection 3, the superintendent shall conduct
23such investigation as the superintendent deems necessary to
24ascertain the following:
25a. The articles of merger and supporting items satisfy the
26requirements of this chapter.
27b. The plan of merger and any modification of the plan of
28merger adequately protects the interests of depositors, other
29creditors and shareholders.
30c. The requirements for a merger under all applicable laws
31have been satisfied and the resulting state bank would satisfy
32the requirements of this chapter with respect to it.
33d. The merger would be consistent with adequate and
34sound banking and in the public interest on the basis of
35the financial history and condition of the parties to the
-80-1plan, including the adequacy of the capital structure of
2the resulting state bank, the character of the management
3of the resulting state bank, the potential effect of the
4merger on competition, and the convenience and needs of the
5area primarily to be served by the resulting state bank,
6particularly the resulting state bank’s plans to accept
7deposits from, lend money in, and process payments in the area
8primarily to be served by the resulting state bank.
92. a. Within one hundred eighty days after acceptance of
10the application for processing, or within an additional period
11of not more than sixty days after receipt of an amendment of
12the application, the superintendent shall approve or disapprove
13the application on the basis of the investigation. The plan of
14merger shall not be modified at any time after approval of the
15application by the superintendent.
16b. If the superintendent finds that the superintendent
17must act immediately on the pending application in order to
18protect the interests of depositors or the assets of any
19party to the plan, the superintendent may proceed without
20requiring publication of the notice required under section
21524.1402, subsection 4. As a condition of receiving the
22decision of the superintendent with respect to the pending
23application, the parties to the plan of merger shall reimburse
24the superintendent for all the expenses incurred in connection
25with the application. The superintendent shall give to the
26parties to the plan of merger written notice of the decision
27and, in the event of disapproval, a statement of the reasons
28for the decision. The decision of the superintendent shall be
29subject to judicial review pursuant to chapter 17A.
30 Sec. 119. Section 524.1404, Code 2021, is amended to read
31as follows:
32524.1404 Procedure after approval by the superintendent —
33issuance of certificate of merger.
34If applicable state or federal laws require the approval of
35the merger by a federal or state agency, the superintendent may
-81-1withhold delivery of the approved articles of merger until the
2superintendent receives notice of the decision of such agency.
3If the final approval of the agency is not given within six
4months of the superintendent’s approval, the superintendent
5shall notify the parties to the plan of merger that the
6approval of the superintendent has been rescinded for that
7reason. If such agency gives its approval, the superintendent
8shall deliver the articles of merger, with the superintendent’s
9approval indicated on the articles, to the secretary of state,
10and shall notify the parties to the plan of merger. The
11receipt of the approved articles of merger by the secretary of
12state constitutes filing of the articles of merger with that
13office. The secretary of state shall record the articles of
14merger, and the articles shall be filed and recorded in the
15office of the county recorder in each county in which the
16parties to the plan had previously maintained a principal place
17of business. On the date upon which the merger is effective
18the secretary of state shall issue a certificate of merger and
19send the same to the resulting state bank and a copy of the
20certificate of merger to the superintendent.
21 Sec. 120. Section 524.1405, subsection 2, Code 2021, is
22amended by striking the subsection and inserting in lieu
23thereof the following:
242. When a merger takes effect, all of the following apply:
25a. Every other financial institution to the merger merges
26into the surviving financial institution and the separate
27existence of every party except the surviving financial
28institution ceases.
29b. All property owned by, and every contract right possessed
30by, each financial institution or other authorized entity that
31is a party to the merger, other than the resulting bank, are
32the property and contract rights of the resulting bank without
33transfer, reversion, or impairment.
34c. All debts, obligations, and other liabilities of each
35financial institution or other authorized entity that is a
-82-1party to the merger, other than the resulting bank, are debts,
2obligations, or liabilities of the resulting bank.
3d. The name of the survivor may, but need not be,
4substituted in any pending proceeding for the name of any party
5to the merger whose separate existence ceased in the merger.
6e. For a resulting state bank, the articles of incorporation
7of the resulting state bank are amended to the extent provided
8in the articles of merger.
9f. The articles of incorporation of a resulting state bank
10that is created by the merger become effective.
11g. The shares of each financial institution or authorized
12entity that is a party to the merger, that are to be converted
13in accordance with the terms of the merger into any combination
14of shares or other securities, obligations, rights to acquire
15shares or other securities, cash, or other property, are
16converted, and the former holders of such shares are entitled
17only to the rights provided in the articles of merger or to
18their rights under section 524.1406.
19h. Except as provided by law or the terms of the merger,
20all the rights, privileges, franchises, and immunities of each
21financial institution or other authorized entity that is a
22party to the merger, other than the resulting bank, are the
23rights, privileges, franchises, and immunities of the resulting
24bank.
25 Sec. 121. Section 524.1405, Code 2021, is amended by adding
26the following new subsection:
27 NEW SUBSECTION. 3. Upon request, the superintendent shall
28expressly revoke the authorization to do business of any state
29bank that is a party to the merger, other than the resulting
30state bank, and shall return the physical copy of such state
31bank’s authorization to do business in a manner clearly
32indicating that the authorization has been revoked.
33 Sec. 122. Section 524.1406, Code 2021, is amended to read
34as follows:
35524.1406 Appraisal rights of shareholders.
-83- 11. A shareholder of a state bank, which is a party to a
2proposed merger plan of merger which will result in a state
3bank subject to this chapter, who objects to the plan of merger
4 is entitled to appraisal rights as provided in chapter 490,
5subchapter XIII.
62. If a shareholder of a national bank which is a party to
7a proposed merger plan of merger which will result in a state
8bank, or a shareholder of a state bank which is a party to a
9plan of merger which will result in a national bank, objects to
10the plan of merger and complies with the requirements of the
11applicable laws of the United States, the resulting state bank
12or national bank, as the case may be, is liable for the value of
13the shareholder’s shares as determined in accordance with such
14laws of the United States.
15 Sec. 123. Section 524.1408, Code 2021, is amended to read
16as follows:
17524.1408 Merger of corporation or limited liability company
18substantially owned by a state bank.
19A state bank owning at least ninety percent of the
20outstanding shares, of each class, of another corporation
21or limited liability company which it is authorized to own
22under this chapter may merge the other corporation or limited
23liability company into itself without approval by a vote of
24the shareholders of either the state bank or the subsidiary
25corporation or limited liability company. The board of
26directors of the state bank shall approve a plan of merger,
27mail the plan of merger to shareholders of record of the
28subsidiary corporation or holders of membership interests in
29the subsidiary limited liability company, and prepare and
30execute articles of merger in the manner provided for in
31section 490.1105. The articles of merger, together with the
32applicable filing and recording fees, shall be delivered to
33the superintendent who shall, if the superintendent approves
34of the proposed merger and if the superintendent finds the
35articles of merger satisfy the requirements of this section,
-84-1deliver them to the secretary of state for filing and recording
2 in the secretary of state’s office, and they shall be filed
3in the office of the county recorder. The secretary of state
4upon filing the articles of merger shall issue a certificate of
5merger and send the certificate to the state bank and a copy of
6it to the superintendent.
7 Sec. 124. Section 524.1409, Code 2021, is amended to read
8as follows:
9524.1409 Conversion of national bank, or federal savings
10association, out-of-state bank, or state or federally chartered
11credit union into state bank.
12A national bank or federal savings association, an
13out-of-state bank, or a state or federally chartered credit
14union may, subject to the provisions of this chapter, may
15 convert into a state bank upon authorization by and compliance
16with the laws of the United States, adoption of a plan of
17conversion by the affirmative vote of at least a majority
18of its directors and the holders of two-thirds of each
19class of its shares at a meeting held upon not less than ten
20days’ notice to all shareholders, and upon approval of the
21superintendent.
22 Sec. 125. Section 524.1410, Code 2021, is amended to read
23as follows:
24524.1410 Application for approval by superintendent.
25A national bank or federal savings association, out-of-state
26bank, or a state or federally chartered credit union shall
27make an application to the superintendent for approval of the
28conversion in a manner prescribed by the superintendent and
29shall deliver to the superintendent, when available:
301. Articles of conversion.
312. As soon as available, proof of publication of the notice
32required by section 524.1412.
333. 2. The applicable fee payable to the secretary of state,
34under section 490.122, for the filing and recording of the
35articles of conversion.
-85-1 Sec. 126. Section 524.1411, unnumbered paragraph 1, Code
22021, is amended to read as follows:
3The articles of conversion shall be signed by two duly
4authorized officers of the national bank or federal savings
5association, out-of-state bank, or state or federally chartered
6credit union, and shall contain all of the following:
7 Sec. 127. Section 524.1411, subsection 1, Code 2021, is
8amended to read as follows:
91. The name of the national bank or federal savings
10association, out-of-state bank, or state or federally chartered
11credit union, and the name of the resulting state bank.
12 Sec. 128. Section 524.1413, subsection 2, Code 2021, is
13amended to read as follows:
142. Within ninety days after the application has been
15accepted for processing, the superintendent shall approve or
16disapprove the application on the basis of the investigation.
17As a condition of receiving the decision of the superintendent
18with respect to the application, the national bank or federal
19savings association, out-of-state bank, or state or federally
20chartered credit union shall reimburse the superintendent for
21all expenses incurred in connection with the application.
22The superintendent shall give the national bank or federal
23savings association, out-of-state bank, or state or federally
24chartered credit union written notice of the decision and, in
25the event of disapproval, a statement of the reasons for the
26decision. If the superintendent approves the application,
27the superintendent shall deliver the articles of conversion,
28with the superintendent’s approval indicated on the articles
29of conversion, to the secretary of state. The decision
30of the superintendent shall be subject to judicial review
31pursuant to chapter 17A. Notwithstanding the terms of the
32Iowa administrative procedure Act, chapter 17A, a petition for
33judicial review must be filed within thirty days after the
34superintendent notifies the national bank or federal savings
35association of the superintendent’s decision.
-86-1 Sec. 129. Section 524.1414, Code 2021, is amended to read
2as follows:
3524.1414 Receipt by secretary of state — county recorder.
4The receipt of the approved articles of conversion by
5the secretary of state constitutes filing of the articles of
6conversion with that office. The secretary of state shall
7record the articles of conversion and the articles shall be
8filed and recorded in the office of the county recorder in the
9county in which the resulting state bank has its principal
10place of business.
11 Sec. 130. Section 524.1415, Code 2021, is amended to read
12as follows:
13524.1415 Effect of filing of articles of conversion with
14secretary of state.
151. The conversion is effective upon the filing of the
16articles of conversion with the secretary of state, or at any
17later date and time as specified in the articles of conversion.
18The acknowledgment of filing is conclusive evidence of the
19performance of all conditions required by this chapter for
20conversion of a national bank or federal savings association,
21out-of-state bank, or state or federally chartered credit union
22 into a state bank, except as against the state.
232. When a conversion becomes effective, the existence of
24the national bank or federal savings association, out-of-state
25bank, or state or federally chartered credit union shall
26continue in the resulting state bank which shall have all the
27property, rights, powers, and duties of the national bank or
28federal savings association, out-of-state bank, or state or
29federally chartered credit union, except that the resulting
30state bank shall have only the authority to engage in such
31business and exercise such powers as it would have, and shall
32be subject to the same prohibitions and limitations to which
33it would be subject, upon original incorporation under this
34chapter. The articles of incorporation of the resulting
35state bank shall be the provisions stated in the articles of
-87-1conversion.
23. A liability of the national bank or federal savings
3association, out-of-state bank, or state or federally chartered
4credit union, or of the national bank’s or federal savings
5association’s, out-of-state bank’s, or state or federally
6chartered credit union’s shareholders, directors, or officers,
7is not affected by the conversion. A lien on any property of
8the national bank or federal savings association, out-of-state
9bank, or state or federally chartered credit union is not
10impaired by the conversion. A claim existing or action pending
11by or against the national bank or federal savings association,
12out-of-state bank, or state or federally chartered credit union
13 may be prosecuted to judgment as if the conversion had not
14taken place, or the resulting state bank may be substituted in
15its place.
164. The title to all real estate and other property owned by
17the converting national bank or federal savings association,
18out-of-state bank, or state or federally chartered credit union
19 is vested in the resulting state bank without reversion or
20impairment.
21 Sec. 131. Section 524.1416, Code 2021, is amended by adding
22the following new subsection:
23 NEW SUBSECTION. 3. Upon request, the superintendent shall
24expressly revoke the authorization to do business of any state
25bank that converts into a national bank or federal savings
26association pursuant to this section and shall return the
27physical copy of such state bank’s authorization to do business
28in a manner clearly indicating that the authorization has been
29revoked.
30 Sec. 132. Section 524.1417, subsection 2, Code 2021, is
31amended to read as follows:
322. If a shareholder of a national bank, or federal savings
33association, or out-of-state bank, or a member of a state or
34federally chartered credit union, that converts into a state
35bank objects to the plan of conversion and complies with
-88-1the requirements of applicable laws of the United States,
2the resulting state bank is liable for the value of the
3shareholder’s shares as determined in accordance with such laws
4of the United States.
5 Sec. 133. Section 524.1421, subsection 2, paragraph d, Code
62021, is amended to read as follows:
7d. The applicable fee payable to the secretary of state,
8under section 490.122, for the filing and recording of the
9articles of conversion.
10 Sec. 134. Section 524.1422, Code 2021, is amended to read
11as follows:
12524.1422 Notice of mutual to stock conversion.
13Within thirty days after an application for conversion has
14been accepted for processing, the mutual corporation, mutual
15holding company, federal mutual association, or federal mutual
16holding company shall publish a notice of the delivery of the
17articles of conversion to the superintendent in a newspaper of
18general circulation published in the municipal corporation or
19unincorporated area in which the mutual corporation, mutual
20holding company, federal mutual association, or federal mutual
21holding company has its principal place of business, or if
22there is none, a newspaper of general circulation published
23in the county, or in a county adjoining the county, in which
24the mutual corporation, mutual holding company, federal
25mutual association, or federal mutual holding company has its
26principal place of business. A copy of the notice shall also
27be posted on the internet site of the mutual corporation,
28mutual holding company, federal mutual association, or federal
29mutual holding company for at least thirty days. The notice
30shall set forth the information required by the superintendent.
31 Sec. 135. Section 524.1502, subsection 3, Code 2021, is
32amended to read as follows:
333. Adoption of each amendment shall require the affirmative
34vote of the holders of a majority of the shares entitled
35to vote thereon and, if any class or series is entitled to
-89-1vote thereon on the amendment as a class separate group, the
2affirmative vote of the holders of a majority of the shares of
3each class or series entitled to vote thereon as a class on the
4amendment by that separate group.
5 Sec. 136. Section 524.1503, subsections 1, 3, and 4, Code
62021, are amended to read as follows:
71. The holders of the outstanding shares of a class are
8entitled to vote as a separate voting group on a proposed
9amendment if the amendment does would do any of the following:
10a. Increases Increase or decreases decrease the aggregate
11number of authorized shares of the class.
12b. Increases Increase or decreases decrease the par value of
13the shares of the class.
14c. Effects Effect an exchange or reclassification of all or
15part of the shares of the class into shares of another class
16or effects a cancellation of all or part of the shares of the
17class.
18d. Effects Effect an exchange or reclassification, or
19creates the right of exchange, of all or part of the shares of
20another class into shares of that class.
21e. Changes Change the designation, rights, preferences, or
22limitations of all or part of the shares of the class.
23f. Changes Change the shares of all or part of the class
24into a different number of shares of the same class.
25g. Creates Create a new class of shares having rights or
26preferences with respect to distributions or to dissolution
27that are prior, superior, or substantially equal to the shares
28of the class.
29h. Increases Increase the rights, preferences, or number
30of authorized shares of any class that, after giving effect
31to the amendment, have rights or preferences with respect to
32distributions or to dissolution that are prior, superior, or
33substantially equal to the shares of the class.
34i. Limits Limit or denies deny an existing preemptive right
35of all or part of the shares of the class.
-90- 1j. Cancels Cancel or otherwise affects affect rights to
2distributions or dividends that have accumulated but not yet
3been declared on all or part of the shares of the class.
43. If a proposed amendment that entitles two or more classes
5or series of shares to vote as separate voting groups under
6this section would affect those two or more classes or series
7in the same or a substantially similar way, the shares of all
8the classes or series so affected must vote together as a
9single voting group on the proposed amendment.
104. A class or series of shares is entitled to the voting
11rights granted by this section although even if the articles of
12incorporation provide that the shares are nonvoting shares.
13 Sec. 137. Section 524.1504, subsection 1, paragraphs c and
14e, Code 2021, are amended to read as follows:
15c. The text of each amendment adopted, which shall be set
16forth in full.
17e. For a state bank incorporated as a stock corporation, the
18number of shares entitled to vote on the amendment, and if the
19shares of any class are entitled to vote thereon as a class,
20the number of shares of each class. For a mutual corporation,
21the number of member votes entitled to be cast.
22 Sec. 138. Section 524.1504, subsection 2, Code 2021, is
23amended to read as follows:
242. The articles of amendment shall be delivered to the
25superintendent together with the applicable fees for the filing
26and recording of the articles of amendment.
27 Sec. 139. Section 524.1506, subsection 1, Code 2021, is
28amended to read as follows:
291. The secretary of state shall record the articles of
30amendment, and the articles of amendment shall be filed in the
31office of the county recorder in the county in which the state
32bank has its principal place of business. The secretary of
33state upon the filing of the articles of amendment shall issue
34a certificate of amendment and send the same to the state bank.
35 Sec. 140. Section 524.1508, subsection 4, Code 2021, is
-91-1amended to read as follows:
24. The restated articles of incorporation shall be
3delivered to the superintendent together with the applicable
4fees for the filing and recording of the restated articles
5of incorporation. The superintendent shall conduct such
6investigation and give approval or disapproval, as provided in
7section 524.1505. If the superintendent approves the restated
8articles of incorporation, the superintendent shall deliver
9them with the written approval on the restated articles of
10incorporation to the secretary of state for filing, and the
11restated articles of incorporation shall be filed in the office
12of the county recorder. The secretary of state upon filing
13the restated articles of incorporation shall issue a restated
14certificate of incorporation and send the certificate to the
15state bank or its representative.
16 Sec. 141. Section 524.1601, Code 2021, is amended by adding
17the following new subsections:
18 NEW SUBSECTION. 5. In addition to the criminal penalties
19provided in subsections 1, 2, 3, and 4, the superintendent may
20impose a civil penalty on any director, officer, or employee
21of a state bank or bank holding company for any violation
22enumerated in subsection 1, 2, 3, or 4. The amount of the
23civil penalty imposed shall be determined in the same manner
24as prescribed by those subsections for calculating criminal
25penalties.
26 NEW SUBSECTION. 6. The superintendent may impose an initial
27civil penalty of up to five hundred thousand dollars on any
28director or officer of a state bank which closes a transaction
29without first receiving the approval of the superintendent
30in violation of section 524.1304, 524.1309, 524.1403, or
31524.1408, or which closes a transaction in violation of section
32524.1401, subsection 2. The superintendent may also impose a
33civil penalty of up to ten thousand dollars on any director or
34officer of a state bank for each day on which the state bank
35operates after closing a transaction without first receiving
-92-1the approval of the superintendent in violation of section
2524.1304, 524.1309, 524.1403, or 524.1408, or which closes a
3transaction in violation of section 524.1401, subsection 2.
4Civil penalties imposed on a director or officer of a state
5bank in accordance with this subsection shall be in addition
6to any penalties imposed on any other director or officer of
7the state bank pursuant to this subsection or on the state bank
8pursuant to section 524.1602, subsection 2.
9 Sec. 142. Section 524.1602, Code 2021, is amended to read
10as follows:
11524.1602 Penalties applicable to state bank.
121. The superintendent may impose a penalty on a state bank
13of up to one thousand dollars for each day:
141. a. That it holds investments for its own account in
15bonds or securities in violation of section 524.901.
162. b. On which it accepts and holds drafts in violation of
17section 524.903.
183. c. On which it has money loaned, credit extended or
19holds discounted or purchased evidences of indebtedness or
20agreements for the payment of money, in violation of sections
21524.904 through 524.907.
224. d. On which it has money loaned, invested or is
23otherwise in violation of section 524.1102 or 524.1104.
245. e. On which it publishes, disseminates, or distributes
25any advertising containing any false, misleading, or deceptive
26statements concerning rates, terms, and conditions on which
27loans are made or deposits are received, in violation of
28section 524.1606.
292. The superintendent may impose an initial penalty of
30up to five hundred thousand dollars on a state bank which
31closes a transaction without first receiving the approval
32of the superintendent in violation of section 524.1304,
33524.1309, 524.1403, or 524.1408, or which closes a transaction
34in violation of section 524.1401, subsection 2. The
35superintendent may also impose a penalty on a state bank of up
-93-1to ten thousand dollars for each day on which it operates after
2closing a transaction without first receiving the approval of
3the superintendent in violation of section 524.1304, 524.1309,
4524.1403, or 524.1408, or which closes a transaction in
5violation of section 524.1401, subsection 2.
6 Sec. 143. Section 524.1801, unnumbered paragraph 1, Code
72021, is amended to read as follows:
8As used in this chapter subchapter unless the context
9otherwise requires:
10 Sec. 144. Section 524.1802, subsection 1, paragraph h, Code
112021, is amended to read as follows:
12h. “Incorporated in any state” means a limited liability
13company organized as a state bank under this chapter and a
14 limited liability company organized as a state bank under the
15laws of any state as defined in 12 U.S.C. §1813(a)(3).
16 Sec. 145. Section 524.1805, subsections 1, 2, 3, 4, and 5,
17Code 2021, are amended by striking the subsections.
18 Sec. 146. Section 524.2001, Code 2021, is amended to read
19as follows:
20524.2001 Applicability of other chapters.
21Chapters 489, 490, 491, 492, and 493 do not apply to banks
22except as provided by this chapter.
23 Sec. 147. REPEAL. Sections 524.226, 524.302A, 524.314,
24524.315, 524.1008, 524.1205, and 524.1412, Code 2021, are
25repealed.
26EXPLANATION
27The inclusion of this explanation does not constitute agreement with
28the explanation’s substance by the members of the general assembly.
29This bill relates to banks, makes appropriations, provides
30penalties, and makes penalties applicable.
31The bill modifies numerous provisions of Code chapter 524,
32and makes conforming changes to Code sections 12.61, 422.61,
33and 453A.8.
34The bill adds the following new defined terms to Code section
35524.103: “affiliate”, “national bank”, “out-of-state bank”,
-94-1and “safe deposit box”. Additionally, the bill modifies the
2following defined terms in Code section 524.103: “articles
3of incorporation”, “bank”, “board of directors”, “business
4of banking”, “calculation date”, “chief executive officer”,
5“contractual commitment to advance funds”, “director”,
6“executive officer”, “insured bank”, “member”, “membership
7interest”, “officer”, “operations subsidiary”, “shareholder”,
8“shares”, “state bank”, “supervised financial organization”,
9and “unincorporated area”. The bill strikes from Code section
10524.103 the term “manager”.
11The bill establishes who will serve as the superintendent
12of banking when the office is vacant or the superintendent is
13unable to serve. The bill modifies the rights and obligations
14of the superintendent, including the superintendent’s rights
15and obligations with respect to ordering a state bank to cease
16to carry on business. Additionally, the bill amends Code
17section 524.207, which appropriates money from the department
18of commerce revolving fund to the division of banking. The
19bill provides that the amount of the appropriation from the
20department of commerce revolving fund is determined by the
21amount of fees and assessments paid to the superintendent.
22The bill modifies the type of entity a state bank may utilize
23when incorporating and modifies the steps in the incorporation
24process.
25The bill amends provisions of Code chapter 524, subchapter
26V, related to fractional shares, record dates, voting lists,
27share information that is required to be included in the state
28bank’s articles of incorporation, and voting by a member of a
29mutual corporation.
30The bill provides for the participation in a meeting of
31the directors and the notice required in conjunction with
32the meetings. Additionally, the bill establishes who may
33administer an oath to a director.
34The bill modifies provisions relating to the decisions of
35officers that do not require shareholder approval.
-95- 1The bill establishes the types and amounts of assets that
2state banks are authorized to hold and invest in. The bill
3authorizes state banks to conduct certain activities in
4electronic form. Additionally, the bill modifies provisions
5related to safe deposit boxes.
6The bill amends provisions related to a state bank’s ability
7to invest in certain public welfare investments, when a state
8bank may purchase cash value life insurance contracts, and
9real property purchased by a state bank at a foreclosure sale.
10Additionally, the bill modifies provisions related to the
11granting of loans and extensions of credit by a state bank.
12The bill modifies provisions related to when a state bank
13is required to cease acting as a fiduciary, the duties of a
14temporary fiduciary, the voluntary relinquishment of fiduciary
15capacity, and the succession of fiduciary accounts.
16The bill requires that fees paid to an affiliate must be made
17in compliance with 12 U.S.C. §371c and 12 U.S.C. §371c-1.
18The bill amends provisions related to the superintendent’s
19authority over out-of-state offices of a state bank.
20Additionally, the bill establishes where data processing
21services may take place. The bill requires a bank doing
22business in this state electronically to identify its legally
23chartered name in any online interface.
24The bill makes syntax and terminology changes to Code
25sections 524.1301, 524.1303, 524.1305, and 524.1306.
26Additionally, the bill modifies provisions related to a state
27bank ceasing to carry on the business of banking and continuing
28as a corporation.
29The bill modifies provisions relating to the types of
30entities that may merge into a state bank and the types of
31entities a state bank may merge into. The bill establishes
32information that must be included in the articles of merger and
33the plan of merger. Additionally, the bill provides for the
34types of entities that may convert into a state bank and the
35requirements related to articles of conversion.
-96- 1The bill modifies provisions related to the affirmative vote
2required of a class or series of shares to adopt an amendment
3to the state bank’s articles of incorporation. The bill makes
4syntax and terminology changes to Code section 524.1503.
5The bill authorizes the superintendent to impose civil
6penalties on a director, officer, or employee of a state bank
7or bank holding company in enumerated instances.
8The bill strikes subsections 1 through 5 from Code
9section 524.1805, which provide restrictions on mergers and
10acquisitions.
11The bill modifies Code section 524.2001 to strike the
12reference to Code chapter 489, the revised uniform limited
13liability company Act.
14The bill repeals Code section 524.226, which provides for
15the management of a state bank by the superintendent after
16taking over the management of the property and business of the
17state bank.
18The bill repeals Code section 524.302A, which provides for
19the requirements associated with articles of incorporation for
20state banks organized as limited liability companies.
21The bill repeals Code section 524.314, which provides for
22the renewal of the corporate existence of state banks existing
23and operating on January 1, 1970.
24The bill repeals Code section 524.315, which provides that
25state banks organized as limited liability companies are also
26subject to Code chapter 489.
27The bill repeals Code section 524.1008, which provides for
28the succession of fiduciary accounts to an independent bank.
29The bill repeals Code section 524.1205, which allows a state
30bank to acquire, establish, operate, or relocate a branch in
31a state other than this state.
32The bill repeals Code section 524.1412, which provides for
33publication of notice after the superintendent accepted the
34application for conversion.
-97-jda/rn