Revision: June 11, 2016, midnight
\t \t\tCHAPTER 230
SB 300 - FINAL VERSION
11May2016... 1477h
2016 SESSION
\t16-2721
\t08/03
SENATE BILL\t300
AN ACT\trevising banking, credit union, and trust laws.
SPONSORS:\tSen. Bradley, Dist 3
COMMITTEE:\tCommerce
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AMENDED ANALYSIS
\tThis bill:
\tI. Requires certain background checks where ownership of a trust company changes.
\tII. Defines "bank."
\tIII. Requires approval by the banking commission for certain name changes.
\tIV. Amends the reference which specifies the legal investments for depository banks which may be used by the state treasurer.
\tV. Removes an obsolete reference from the definition of "required capital" in the Family Trust Company Act.
\tThis bill is a request of the banking department.
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Explanation:\tMatter added to current law appears in bold italics.
\t\tMatter removed from current law appears [in brackets and struckthrough.]
\t\tMatter which is either (a) all new or (b) repealed and reenacted appears in regular type.
11May2016... 1477h\t16-2721
\t08/03
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Sixteen
AN ACT\trevising banking, credit union, and trust laws.
Be it Enacted by the Senate and House of Representatives in General Court convened:
\t230:1 Board of Trust Company Incorporation Decisions. Amend RSA 383 by inserting preceding section 25 the following new subdivision heading:
Board of Trust Company Incorporation Decisions
\t230:2 Change of Ownership of a Trust Company; Background Check. Amend RSA 383-C:8-802(a)(1) to read as follows:
\t\t\t\t(1) The identity, personal history, business background, and experience of the proposed new owner or new owners, including (i) each new owner's material business activities and affiliations during the past 5 years, (ii) a description of any material pending legal or administrative proceedings in which the new owner is a party and (iii) a description of any criminal indictment or conviction of the new owner by a state or federal court. To fulfill the requirements of (iii), the commissioner may require the proposed owner or owners to submit to a criminal history records check by following the procedure prescribed under RSA 383-A:3-305(e)(3)-(4);
\t230:3 Change of Control of a Trust Company; Background Check. Amend RSA 383-C:8-803(a)(1) to read as follows:
\t\t\t\t(1) The identity, personal history, business background, and experience of the proposed acquirer or acquirers of control, including (i) each acquirer's material business activities and affiliations during the past 5 years, (ii) a description of any material pending legal or administrative proceedings in which the acquirer is a party and (iii) a description of any criminal indictment or conviction of the acquirer by a state or federal court. To fulfill the requirements of (iii), the commissioner may require the proposed owner or owners to submit to a criminal history records check by following the procedure prescribed under RSA 383-A:3-305(e)(3)-(4);
\t230:4 Family Trust Companies; Key Employees. Amend RSA 383-D:4-403(b) to read as follows:
\t\t\t(b) In addition to any individual who is a key employee under RSA 383-D:2-201(b)(10)(A) or (B), a family trust company may designate as a key employee an individual who is a current or former employee of the family trust company, an eligible trust, a family entity, or a family charitable organization. A family trust company may revoke any designation of an individual as a key employee. At any time, the number of individuals designated as key employees under this subsection shall not exceed 35.
\t230:5 Branch Offices; Authority. Amend RSA 383-E:9-901(b) to read as follows:
\t\t\t(b) A credit union that is well capitalized under applicable federal law and has a composite CAMELS rating of at least 2 as a result of its most recent examination by its federal regulatory authority or the commissioner, shall provide the commissioner with notice of its proposal to establish or acquire a branch office as required under RSA 383-A:6-602. All other credit unions shall submit an application to establish a [trust] branch office under RSA 383-A:6-602. A credit union may proceed to establish or acquire the branch office if it is permitted to do so by the commissioner.
\t230:6 Corporate Credit Unions; Reserves. Amend RSA 383-E:13-1312 to read as follows:
\t383-E:13-1312 Reserves. A corporate credit union shall be exempt from the regular reserve requirements of [RSA 383-E:9-901] RSA 383-E:8-801 but shall be required to establish and maintain an equity reserve to meet losses, in accordance with rules adopted by the commissioner, under RSA 541-A.
\t230:7 Definition of Bank RSA 399-F:1, I is repealed and reenacted to read as follows:
\t\tI. "Bank" means a bank as defined in RSA 383-A:2-201(a)(3).
\t230:8 New Paragraph; Definition; Credit Union. Amend RSA 399-F:1 by inserting after paragraph I the following new paragraph:
\t\tI-a. "Credit union" means a credit union as defined in RSA 383-A:2-201(a)(15).
\t230:9 Credit Unions; Establishment of Cash Dispensing Machines. Amend RSA 399-F:2, II to read as follows:
\t\tII. Paragraph I shall not apply to and this chapter shall not govern any cash dispensing machine or similar electronic device established by a bank or credit union.
\t230:10 State Banks; Names. Amend RSA 383-A:3-320 to read as follows:
\t383-A:3-320 Names Relating to State Banks. Any state bank that intends to use a name in the conduct of its business that differs from the name of the state bank [and any person that intends to use a name in New Hampshire that contains the words "banking,'' "bank,'' "trust company,'' "bank holding company,'' "bancorp'' or other names of similar import] shall be required to obtain the approval of the use of the name from the commissioner before registering the name with the secretary of state. The approval shall accompany an application to register the name with the secretary of state. A state bank [or other person] shall not have or use a name that is likely to mislead the public concerning the nature or scope of its powers or purposes. [A state bank or other person shall not have or use a name that is the same or confusingly similar to the name of another entity, unless the commissioner and the other entity consent to the use of that name.]
\t230:11 Rights and Duties Regarding Depository Accounts. RSA 383-B:4-401 is repealed and reenacted to read as follows:
\t383-B:4-401 Deposit Accounts. This article sets forth the rights and duties of persons with respect to certain deposit accounts.
\t383-B:4-402 Powers of Attorney. A depository bank doing business in this state may continue to recognize the power of an attorney-in-fact authorized in writing to make withdrawals either in whole or in part from the account of a depositor, whether a minor or adult, until it receives written notice or is on actual notice of the revocation of his or her authority. No depository bank shall be liable for damages, penalties, or tax by reason of any payment made under this section.
\t383-B:4-403 Assignments.
\t\t\t(a) No assignment of a deposit which is evidenced by a passbook or certificate of deposit shall be a valid transfer of the deposit unless the passbook or certificate of deposit is delivered to the assignee accompanied by a written assignment or order for transfer.
\t\t\t(b) No assignment of a deposit, however evidenced, shall be effective to charge the depository bank in which the deposit is maintained with a duty of payment to the assignee prior to service by the assignee on the depository bank of written notice of the assignment. No depository bank shall be liable to an assignee of a deposit maintained in that bank for any payment of the deposit or portion thereof or dividend or interest thereon made to the depositor prior to service on the depository bank by the assignee of the written notice of the assignment; except that the exemption from liability shall not apply in the case of a payment to a depositor, with respect to a deposit evidenced by a passbook, which is made without production of the passbook if the bylaws of the depository bank require production of the passbook as a condition to payment.
\t383-B:4-404 Payable on Death Accounts.
\t\t\t(a) A "payable on death'' deposit account is created by a deposit in a depository bank in the name of an owner or several joint owners with a designation that the account is payable on death to one or more payees, or is in trust for another, and no other or further notice of the existence and terms of a legal and valid trust is given in writing to the bank. Any person designated as an owner, account holder or words to similar effect is deemed to be an owner of the deposit account. Each owner retains the right during the owner's lifetime to withdraw, assign, or pledge the balance of the deposit account, in whole or in part, as though no survivor payee or beneficiary had been named, and to delete or change a survivor payee or beneficiary. No change in the designation of the survivor payee or beneficiary is valid unless executed on a form and in the manner prescribed by the depository bank. On the death of the sole owner or the last surviving joint owner, any remaining balance in a payable on death account, including interest, shall vest solely in the surviving payable on death payee, or the in trust for beneficiary, or equally and severally in the then surviving payees or beneficiaries. If no payee or beneficiary survives, the deposit account shall remain in the estate of the last surviving owner. Ninety days after the death of the sole owner or the last surviving joint owner, the depository bank may pay the remaining balance in the deposit account to the new owner or owners or their legal representatives without further liability for the amount or amounts paid. If no payee or beneficiary is surviving 90 days after the last surviving owner dies, the balance of the account shall be payable to the personal representative of that owner. A depository bank which makes payment in accordance with this section shall, to the extent of each payment so made, be released from all claims of any of the deposit account owners, the named payees or beneficiaries, their respective legal representatives, and all others claiming through or under them. Each payee, beneficiary or legal representative claiming under this section shall provide the identification and other information as requested by the depository bank.
\t\t\t(b) Each owner of a payable on death deposit account retains the right during the owner’s lifetime to withdraw, assign or pledge the balance of the deposit account, in whole or in part, as though no survivor payee or beneficiary had been named, and to delete or change a survivor payee or beneficiary. No change in the designation of the survivor payee or beneficiary is valid unless executed on a form and in the manner prescribed by the depository bank. Unless otherwise required in writing by all of the owners at the time the deposit account is created, the withdrawal, assignment or pledge of one owner shall be binding on the other owners. For purposes hereof, no payee or beneficiary shall be deemed to be an owner.
\t\t\t(c) The rights of a surviving payee or beneficiary to the funds in a payable on death deposit account shall not be denied, abridged or in any way affected because the rights have not been created by a writing executed in accordance with the laws of this state prescribing the requirements to effect a valid testamentary disposition of property or because of any absence of delivery or compliance with other requirements to effect a valid gift or transfer in trust.
\t383-B:4-405 Joint Accounts. A person or persons may establish a deposit account at a state or foreign depository bank doing business in this state pursuant to a written agreement. The written agreement shall govern the rights of any person who is named as an owner of the account. In the absence of a written agreement, if 2 or more persons are named on a deposit account as owners, the account shall be payable to any owner, and in the event of death, to the survivor or survivors of them. The survivors shall be entitled to ownership of the account whether or not (i) the funds deposited were the property of only one or some of the owners, (ii) at the time of the making of such deposits there was any intention on the part of the owners making such deposit to vest the other owner or owners with a present interest therein, (iii) only one of the owners during their several lives had the right to withdraw such deposit, or (iv) there was any delivery of any bank book, account book, savings account book, certificate of deposit, or other evidence of such an account, by the owner or owners making such deposit to the other owner or owners. The receipt by an owner of the account of any payment from the account made by the depository bank on the owner’s request shall discharge the depository bank from any liability for any payment so made. Nothing in this paragraph shall be construed to prohibit an owner making a deposit or deposits from withdrawing the deposit during his or her lifetime, nor shall the existence of the right to withdraw the deposit during his or her lifetime defeat the rights provided herein for the owner or his or her survivors.
\t383-B:4-406 Minor Accounts. Depository banks may pay to a minor deposits to his or her credit as if he or she were of age, and the receipt by the minor shall discharge the depository bank of any liability for any payment so made. A minor shall have the power of a person of lawful age to pledge a deposit account that is owned or co-owned by the minor in order to secure a collateral obligation not exceeding the amount of the account.
\t383-B:4-407 Foreign Banks. The provisions of this section shall also apply to deposits maintained in this state by foreign banks.
\t230:12 State Treasurer; Investment of Funds. Amend RSA 6:8, I to read as follows:
\t\tI. All funds over which the state has exclusive control, aside from such sums of money as the treasurer may deem necessary to hold or deposit for meeting current expenses, shall be invested by the treasurer, with the approval of the governor and council, in obligations of the United States government, in obligations of any county government, municipal government, or district or division thereof within the state of New Hampshire, in obligations which are legal investments for depository banks pursuant to [RSA 383-B:3-301(e)] RSA 383-B:3-303, in participation units in the public deposit investment pool established pursuant to RSA 383:22, or in deposits, including money market accounts, or certificates of deposit, or repurchase agreements, and all other types of interest bearing accounts, of federally insured banks chartered under the laws of New Hampshire or the federal government with a branch within the state.
\t230:13 Family Trust Company Act; Definitions. Amend RSA 383-D:2-201 (b)(12) to read as follows:
\t\t\t\t(12) "Required capital'' means the amount of capital that a family trust company is required to maintain under RSA 383-D:6-602. [RSA 383-C:2-202(d) shall not apply for purposes of this chapter.]
\t230:14 Effective Date. This act shall take effect 60 days after its passage.
Approved: June 9, 2016
Effective Date: August 8, 2016