TO: All Federally Insured Banks, Savings Banks and Savings and Loan Associations in Tennessee and Independent Trust Companies
SUBJECT: Chapter 0180-15, Rules Pertaining to Acquisitions of Financial Institutions and Holding Companies
DATE: December 1, 1997
On April 30, 1997, an Amendment to Chapter 0180-15 of the Rules of the Department of Financial Institutions became effective. The Chapter addresses rules relating to the application or notification procedures required for the direct or indirect acquisition of banks, savings associations, savings banks, and trust companies. These rules provide the Department with the ability to monitor compliance with the deposit cap which prohibits any bank holding company from acquiring a Tennessee bank if the acquisition would result in the bank or bank holding company controlling thirty percent (30%) or more of the insured deposits in the state. These rules also establish the Department's ability to monitor compliance with the prohibition against any bank or bank holding company acquiring a financial institution which has not been in operation for five (5) years, subject to any and all exemptions.
Many of these rules are necessary to implement the recent statutory changes which permit interstate banking and branching. Finally, these rules allow the Department to review acquisitions for safety and soundness as a means of preserving state-chartered banks, savings associations, savings banks, and trust companies.
A copy of Chapter 0180-15 is attached* for your information and review. Should you have questions regarding this Bulletin or the attachments, please contact either Curt Faulkner at 615/741-4791 or Debra Grissom at 615/741-5018.
Bill C. Houston