The OCC issued a final rule (the “Rule”) that amends certain OCC regulations to reduce or eliminate unnecessary regulatory burden, incorporate certain prior OCC interpretive opinions, conform OCC regulations to statutory changes made by the Financial Services Regulatory Relief Act of 2006 (see the July 17, 2007, October 17, 2006 and October 2, 2006 Alerts) and to make certain other technical and conforming changes.
Among the most important amendments made by the Rule are:
provisions with respect to national bank operating subsidiaries that:
allow operating subsidiaries to be formed as limited partnerships;
- update the standards used by the OCC in determining whether an entity qualifies as an operating subsidiary;
- clarify when a national bank may file an after-the-fact notice to establish or acquire an operating subsidiary and when an application must be filed; and
- expand the list of operating subsidiary activities eligible for the filing of an after-the-fact notice.
provisions to codify OCC precedent and reflect certain current developments in electronic banking;
provisions that simplify a national bank’s authority to pay a dividend and that remove the geographic limits with respect to its bank service companies;
provisions that permit a national bank to choose whether to provide for cumulative voting in the election of directors;
provisions that revise the regulations under the Change in Bank Control Act (“CBCA”) that
- require a CBCA Notice to address the future prospects of the national bank to be acquired
- allow the OCC to issue a notice of disapproval using the future prospects of the national bank acquired as a basis for such disapproval; and
- permit the OCC to impose conditions in a letter of nonobjection to a CBCA Notice; and
- provisions reducing the burden on national banks associated with applications for fiduciary powers (e.g., elimination of the legal opinion requirement), applications for intermittent branches and requirements to make securities filings with the OCC.