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Key: Green = existing Code. Red = new code to be enacted
Senate Bill No. 182
(By Senators Minard, Yoder, Barnes and Kessler)
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[Introduced January 23, 2007; referred to the Committee on
Banking and Insurance; and then to the Committee on Finance.]
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A BILL to amend and reenact §31A-2-6 of the Code of West Virginia,
1931, as amended, relating to providing that the Division of
Banking shall employ the same frequency of examination
schedules of depository financial institutions as the primary
federal regulators of those institutions.
Be it enacted by the Legislature of West Virginia:
That §31A-2-6 of the Code of West Virginia, 1931, as amended,
be amended and reenacted to read as follows:
ARTICLE 2. DIVISION OF BANKING.
§31A-2-6. Commissioner's examinations of financial institution;
reports; records; communications from commissioner to
institution; examination by federal or out-of-state
agency in lieu of commissioner's examination.
The commissioner shall make at least once every twelve months, a thorough examination of all the books, accounts, records and
papers of every depository financial institution, with: (1) Assets
of more than two hundred fifty million dollars; or (2) banks with
a composite rating of three, four or five under the federal uniform
financial institution rating system. For all other depository
financial institutions the commissioner of banking shall make, at
least once every eighteen months, a thorough examination of all the
books, accounts, records and papers using the same frequency of
examination schedule as the financial institution's primary federal
regulator. He or she shall carefully examine all of the assets of
each such institution, including its notes, drafts, checks,
mortgages, securities deposited to assure the payment of debts unto
it and all papers, documents and records showing, or in any manner
relating to, its business affairs, and shall ascertain the full
amount and the nature in detail of all of its assets and
liabilities. The commissioner may also, at his or her discretion,
make or cause to be made an annual or periodic examination of the
books, accounts, records and papers of other financial institutions
under his or her supervision for the purposes of determining
compliance with applicable consumer and credit lending laws and
verifying information provided in any license application or annual
report submitted to the commissioner. The commissioner may also
make such examination of any subsidiaries or affiliates of a financial institution as he or she may deem necessary to ascertain
the financial condition of the financial institution, the relations
between the financial institution and its subsidiaries and
affiliates and the effect of the relations upon the affairs of such
financial institution. A full report of every examination shall be
made and filed and preserved in the office of the commissioner and
a copy thereof forthwith mailed to the institution examined. Every
institution shall retain all of its records of final entry for the
period of time as required in section thirty-five, article four of
this chapter for banking institutions. Unless otherwise covered by
assessments or a specific provision of this code, the cost of
examinations made pursuant to this section shall be borne by the
financial institution at a rate of fifty dollars per each examiner
hour expended.
Every official communication from the commissioner to any
institution, or to any officer thereof, relating to an examination
or an investigation of the affairs of the institution conducted by
the commissioner or containing suggestions or recommendations as to
the manner of conducting the business of the institution, shall be
read by the board of directors at the next meeting after the
receipt thereof and the president, or other executive officer, of
the institution shall forthwith notify the commissioner in writing
of the presentation and reading of the communication and of any action taken thereon by the institution.
The commissioner of banking, in his or her discretion, may:
(a) Accept a copy of a reasonably current examination of any
banking institution made by the federal deposit insurance
corporation or the federal reserve system in lieu of an examination
of the banking institution required or authorized to be made by the
laws of this state and the commissioner may furnish to the federal
deposit insurance corporation or the federal reserve system or to
any official or examiner thereof any copy or copies of the
commissioner's examinations of and reports on the banking
institutions; (b) accept a copy of a reasonably current examination
of any out-of-state bank or any West Virginia state bank's
out-of-state activities made by another state's banking regulatory
authority in lieu of an examination of the banking institution
required or authorized to be made by the laws of this state and the
commissioner may furnish to such other state's banking regulatory
authority or to any official or examiner thereof any copy or copies
of the commissioner's examinations of and reports on such banking
institutions; but nothing herein shall be construed to limit the
duty and responsibility of banking institutions to comply with all
provisions of law relating to examinations and reports, nor to
limit the powers and authority of the commissioner of banking with
reference to examinations and reports under existing laws. The provision or exchange of examination reports and other records of
financial condition and individuals pursuant to cooperative,
coordinating or information-sharing agreements with other bank
supervisory agencies and persons as permitted by this chapter under
an agreement of confidentiality shall not constitute a violation of
section four of this article.
NOTE: The purpose of this bill is to ensure that the West
Virginia Division of Banking uses the same time periods for the
examination of state-chartered banks as the time periods used by
the Federal Deposit Insurance Corporation and the Federal Reserve
System.
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.