Memo RM1999-4
To: All Kansas State Chartered Banks and Trust Companies
From: Judi Stork, Acting Bank Commissioner
Date: August 12, 1999
RE: Proposed Changes to Administrative Regulations;
Notice of Hearing and Comment Period
K.A.R. 17-11-19
K.A.R. 17-22-1
K.A.R. 17-23-16
Enclosed please find a copy of the notice of hearing on proposed amendments to administrative regulations affecting banks and trust companies. This notice appeared in the August 5, 1999 issue of the Kansas Register. Also enclosed are copies of the regulations, with the old language in strike type and the new language underlined. As the Kansas Register notice indicates, a public hearing will be held on October 18, 1999 so the State Banking Board may vote on adoption of these amendments. You are welcome to attend the hearing in person to present your views; however, presentations should be in writing whenever possible. Written comments concerning the regulations may be submitted to the Office of the State Bank Commissioner at any time during the comment period. Remember, in order for your comments to be considered, they must be received prior to the hearing.
Office of the State Bank Commissioner
Notice of Hearing on Proposed Administrative Regulations
A public hearing will be conducted at 9 am, on Monday, October 18, 1999 in the conference room of the Office of the State Bank Commissioner, Suite 300, 700 SW Jackson, Topeka, Kansas to consider the adoption of Kansas Administrative Regulations 17-11-19, 17-23-16, and 17-22-1. The regulations proposed are for adoption on a permanent basis.
K.A.R. 17-11-19. This regulation concerns the records of charged-off assets. This amendment is intended to clarify that maintenance of a general ledger is not a sufficient "central listing" for purposes of compliance with the regulation's requirement concerning records of charged-off assets. The amendment makes clear that maintenance of a subsidiary ledger for each debtor is required. Finally, there are no new costs associated with this added language in the regulation because, in practice, most banks already maintain such subsidiary ledgers. Adoption of this regulation will result in no new economic impact on a government agency, regulated entities, or the public.
K.A.R.17-22-1. The amendment proposed is merely adding language to address an aspect of bank relocation not currently present in the regulation. The amended regulation would include the situation where a main bank office is moved to a new location and bank management chooses to maintain the old main office location as a branch. The OSBC has had at least one situation this year which was not covered by the current regulation and this prompted the need for amending the regulation. The proposed fee for this new relocation scenario is $500. The OSBC believes this fee accurately reflects the amount of time necessary for the agency to process the application. Finally, the added language in the regulation will not have an impact on the general public or any other governmental entity.
K.A.R. 17-23-16.This regulation concerns the location of trust documents. It currently requires that all of the original governing instruments establishing a fiduciary relationship with a bank or trust company be kept in one location. By adding the language "unless an exception is granted by the commissioner" preceding this requirement, the OSBC will gain the ability to review situations on a case-by-case basis thus avoiding unnecessary burdens on banks and trust companies while preserving the intent behind the regulation, which is to ensure that our examiners are able to conduct examinations efficiently.
A copy of the proposed regulations and the economic impact statement may be obtained by contacting Ezra Ginzburg, Staff Attorney, Office of the State Bank Commissioner, 700 SW Jackson, Suite 300, Topeka, Kansas 66603, (785) 296-2266. The standard departmental cost will be assessed for any copies requested.
This 60-day notice of hearing shall constitute a public comment period for the purpose of receiving public comments on the proposed regulations. Written comments should be submitted prior to the hearing to Judi Stork, Acting Bank Commissioner, at the address listed above. Interested persons will be given reasonable opportunity at the hearing to present their views and arguments on the adoption of the proposed regulations. However, presentations should be in writing whenever possible.
Any individual with a disability may request accommodation in order to participate in the public hearing and may request the proposed regulations and economic impact statement in an accessible format. Requests for accommodation to participate in the hearing should be made at least five working days before the hearing by contacting Ezra Ginzburg at (785)296-2266, fax (785)296-0168.
Judi Stork
Acting Bank Commissioner
K.A.R. 17-11-19. Charged-off assets; records. The bank or trust company shall permanently maintain a central listing of any assets charged-off charged off the books of the bank or trust company. The listing shall show central listing shall include a subsidiary ledger for each debtor, showing the date of the charge-off, the a description of the asset, the amount charged-off charged off, and any recoveries. (Authorized by K.S.A. 9-1713 and K.S.A. 9-1130; implementing K.S.A. 1995 1998 Supp. 9-1101, 9-2103 and K.S.A. 9-1130; effective Jan. 1, 1966; amended Aug. 9, 1996; amended P-__________________.)
K.A.R. 17-22-1. Application fees. (a) At the time of filing of any application described below, the applicant shall remit to the office of the state bank commissioner the following nonrefundable fee:
(1) Bank or trust company charter
$2,500
(2) New branch bank
1,000
(3) Relocation
(A) Main office or branch relocation
1,000
(B) Short-form main office relocation
500
(C) Interchange of main office and branch
500
(D) Main office with existing location retained as a
branch
500
(4) Merger, consolidation, or transfer of assets and liabilities
1,000
(5) Change of control
(A) General
1,000
(B) Bona fide gift or inheritance
500
C) Formation of one-bank holding company and associated exchange of stock
500
(6) Conversion to state charter
no fee
(7) Bank service corporation
500
(8) Fiduciary activities
(A) Fiduciary powers
no fee
(B) Trust branch established pursuant to K.S.A. 9-1135
500
(C) Trust service desk established pursuant to K.S.A. 9-2107
500
(D) Trust service office established pursuant to K.S.A. 9-2108
500
(E) Contracting trustee agreement established pursuant to K.S.A. 9-2107
500
(9) Money order license
100/ , plus $10 per agent
(10) Change of name
250
(11) Revenue bond pledgibility
200
(12) Letter of good standing
50
(13) Administrative appeals pursuant to K.S.A. 9-2108(i),
9-2107(l), or 9- 1135(j)
1,000
(b) The statutory procedures governing the applications described in paragraph (a) (2), paragraph (a)(3) (A) or (C), and paragraph (a) (8) (B), (C), or (D) above may require a public hearing. If such a hearing is required, the applicant shall pay an additional nonrefundable fee of $400 shall be paid by the applicant to defray the expenses of the hearing.
(c) The applicant shall pay any additional cost associated with any examination or investigation shall be paid by the applicant if the state bank commissioner determines that an on-site examination of the financial institutions or trust companies that are parties to the application is necessary. (Authorized by K.S.A. 9-1713; implementing K.S.A. 1996 1998 Supp. 9-509, 9-532, 9-1111, 9-1111b, 9-1115, 9-1135, 9-1402, 9-1722, 9-1724, 9-1803, 9-1804, and 9-2107, and K.S.A. 1996 Supp. 9-1111, as amended by L. 1997, Ch. 180, Sec. 12, K.S.A. 1996 Supp. 9-1402, as amended by L. 1997, Ch. 180, Sec. 4, and K.S.A. 9-1127c, 9-1601, and 9-812; effective Oct. 19, 1992; amended Aug. 16, 1993; amended Oct. 31, 1994; amended Nov. 14, 1997; amended P- ____________.)
K.A.R. 17-23-16. Location of trust documents. (a) Unless an exception is granted by the commissioner, all of the original governing instruments establishing a fiduciary relationship with a bank or trust company shall be permanently maintained and located at one site, which shall be either one of the
following:
(1) The main bank or trust company location;
(2) an approved branch or trust service office; or
(3) another site approved by the commissioner.
(b) The following factors shall be considered by the commissioner in determining whether to grant an exception:
(1) The cost to the bank or trust company to maintain all original governing instruments at one site;
(2) the additional burden to the bank or trust company to maintain all original governing instruments at one site; and
(3) the effect that storage at separate locations will have on the ability of the commissioner, or the commissioner's designees, to efficiently conduct an examination of the bank or trust company.
(b) (c) All other records shall be stored at any main bank or trust company location, an approved branch or trust service office, or another site approved by the commissioner.
(c) (d) For purposes of examination, the bank or trust company shall make available original governing instruments and other records as deemed necessary by the commissioner to complete an examination. (Authorized by K.S.A. 9-1713 and K.S.A. 9-1130; implementing K.S.A. 9-1603,
9-1130, and K.S.A. 1998 Supp. 9-2103;
effective Feb. 28, 1994; amended P-__________________.)
