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69th Legislature 2025 HB 434
- 1 - Authorized Print Version – HB 434
ENROLLED BILL
AN ACT REVISING BANKING LAWS TO PROVIDE THAT AN INTERACTIVE TELLER MACHINE DOES NOT
CONSTITUTE A BRANCH BANK UNDER CERTAIN CIRCUMSTANCES; DEFINING INTERACTIVE TELLER
MACHINE; REVISING DEFINITIONS; AND AMENDING SECTIONS 32-1-109 AND 32-6-103, MCA.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:
Section 1. Section 32-1-109, MCA, is amended to read:
"32-1-109. Definitions. As used in this chapter, unless the context requires otherwise, the following
definitions apply:
(1) "Acquire" means:
(a) the direct or indirect purchase or exchange of stock;
(b) the direct or indirect purchase of assets and liabilities; or
(c) a merger.
(2) "Acquiring party" means the person acquiring control of a bank through the purchase of stock.
(3) "Affiliate" has the meaning given in 12 U.S.C. 1841(k).
(4) "Bank holding company" means a bank holding company or a financial holding company
registered under the federal Bank Holding Company Act of 1956, as amended, regardless of where the entity is
located or has its headquarters.
(5) "Branch" means:
(a) in the case of a bank, a banking house, other than the main banking house, maintained and
operated by a bank doing business in the state and at which deposits are received, checks are paid, or money
is lent. The term does not include a satellite terminal, as defined in 32-6-103, an interactive teller machine as
defined in this section, a loan production office, or the office of an affiliated depository institution acting as an
agent under 12 U.S.C. 1828.
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(b) in the case of a trust company, any office at which trust services are provided.
(6) "Capital", "capital stock", and "paid-in capital" mean that fund for which certificates of stock are
issued to stockholders.
(7) "Consolidate" and "merge" mean the same thing and may be used interchangeably in this
chapter.
(8) "Control" means:
(a) ownership of, authority over, or power to vote, directly or indirectly, 25% or more of any class of
voting security;
(b) authority in any manner over the election of a majority of directors; or
(c) power to exercise, directly or indirectly, a controlling influence over management and policies.
(9) "Demand deposits" means all deposits, the payment of which can legally be required when
demanded.
(10) "Department" means the department of administration provided for in Title 2, chapter 15, part
10.
(11) "Depository institution" means a bank or savings association organized under the laws of a
state or the United States.
(12) "Division" means the division of banking and financial institutions of the department.
(13) "Doing business in this state" means located in this state or having a physical branch bank
location in this state.
(14) "Headquarters" means the state in which the activities of a bank holding company or a
company controlling the bank holding company are principally conducted within the meaning of the federal
Bank Holding Company Act of 1956, as amended.
(15) "Insured depository institution" means a bank or savings association in which the deposits are
insured by the federal deposit insurance corporation.
(16) "Interactive teller machine" means an automated, unstaffed banking facility owned or operated
by, or operated exclusively for, a bank that is equipped to enable existing customers to initiate an interactive
session with remotely located bank personnel. Customers must also be able to perform core banking
transactions at the machine without the involvement of bank personnel and must have the sole discretion to
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initiate or terminate interactive sessions with bank personnel.
(16)(17)"Loan production office" means a staffed facility, other than a branch, that provides lending-
related services to the public, including loan information and applications.
(17)(18)"Located in this state" means:
(a) in the case of a bank, that the bank is either organized under the laws of this state or is a
federally chartered bank whose organizational certificate identifies an address in this state as the principal
place at which the business of the federally chartered bank is conducted; and
(b) in the case of a bank holding company, that the entity, partnership, or trust is organized under
the laws of this state.
(18)(19)"Main banking house" means the designated principal place of business of a bank.
(19)(20)"Net earnings" means the excess of the gross earnings of a bank over expenses and losses
chargeable against those earnings during any 1 year.
(20)(21)"Principal shareholder" means a person who directly or indirectly owns or controls, individually
or through others, more than 10% of any class of voting stock.
(21)(22)"Profit and loss account" or "profit and loss" means that account carried on the books of the
bank into which all earnings accounts and recoveries are closed, thus exhibiting "gross earnings", and against
which all loss and other disbursement items are charged, revealing "net earnings", which are then properly
closed to "undivided profits accounts" or "undivided profits", out of which dividends are paid and reserves set
aside.
(22)(23)"Regional banking organization" means a bank organized in this state that is owned by an
entity with consolidated total assets between $10 billion and $50 billion and that has subsidiaries operating in
one or more states but not nationwide.
(23)(24)"Savings association" means a savings association or savings bank organized under the laws
of the United States or a building and loan association, savings and loan association, or similar entity organized
under the laws of a state.
(24)(25)(a) "Service provider" means an individual or person that provides one or more of the following
services to a depository institution:
(i) data processing services;
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(ii) activities supporting financial services, including but not limited to lending, funds transfer,
fiduciary activities, trading activities, and deposit taking;
(iii) internet-related services, including but not limited to web services and electronic bill payments,
mobile applications, system and software development and maintenance, and security monitoring; and
(iv) activities related to the business of banking.
(b) The term does not include:
(i) an individual or person that provides telecommunications service, internet access service,
internet transport services, voice over internet protocol service, or other internet protocol-enabled service; or
(ii) a general audience internet or communications platform.
(25)(26)"Shell bank" means a bank organized solely for the purpose of, and that does not conduct any
banking business prior to, acquiring control of, merging with, or acquiring all or substantially all of the assets of
an existing bank or savings association.
(26)(27)"Subsidiary" means a company 25% or more of whose voting shares or equity interests are
owned and controlled by a bank.
(27)(28)"Surplus" means a fund paid in or created under this chapter by a bank from its net earnings or
undivided profits that, when set apart and designated as surplus, is not available for the payment of dividends
and cannot be used for the payment of expenses or losses so long as the bank has undivided profits.
(28)(29)"Tier 1 leverage ratio" means the ratio of tier 1 capital to average total assets as defined in 12
CFR 324.10(b)(4).
(29)(30)"Time deposits" means all deposits, the payment of which cannot legally be required within 7
days.
(30)(31)"Undivided profits" means the credit balance of the profit and loss account of a bank."
Section 2. Section 32-6-103, MCA, is amended to read:
"32-6-103. Definitions. As used in this chapter, unless the context otherwise requires, the following
definitions apply:
(1) "Customer", in relation to a financial institution, means a holder of a demand or time account or
a membership share in the institution or a person who is a borrower or a mortgagor; in relation to a merchant, it
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means a purchaser of goods or services.
(2) "Department" means the department of administration.
(3) (a) "Electronic funds transfer" means any transfer of funds, other than a transaction originated
by check, draft, or similar paper instrument that is initiated through an electronic terminal, telephone, computer,
or magnetic tape for the purpose of ordering, instructing, or authorizing a financial institution to debit or credit an
account. The term includes but is not limited to point-of-sale transfers, automated teller machine transfers,
interactive teller machine transfers, direct deposits or withdrawals of funds, and transfers initiated by telephone.
It also includes a transfer resulting from a debit card transaction, including a transaction that does not involve
an electronic terminal at the time of the transaction.
(b) The term does not include payments made by check, draft, or similar paper instrument at an
electronic terminal.
(4) "Electronic terminal" means an electronic device, other than a telephone operated by a
consumer, through which a consumer may initiate an electronic funds transfer. The term includes but is not
limited to point-of-sale terminals, automated teller machines, interactive teller machines, and cash dispensing
machines.
(5) "Financial institution" means a bank chartered under chapter 1 of this title, a bank chartered
under the National Banking Acts in Title 12 of the United States Code, a building and loan association chartered
under chapter 2 of this title, a savings and loan association chartered under the Home Owners' Loan Act in Title
12 of the United States Code, a credit union chartered under chapter 3 of this title, or a credit union chartered
under the Federal Credit Union Act in Title 12 of the United States Code. For purposes of this chapter only, a
consumer loan company licensed under chapter 5 is considered a financial institution.
(6) "Merchant" means a natural person, corporation, partnership, or association engaged in buying
and selling goods or services, except that a financial institution is not a merchant.
(7) "Person" means an individual, partnership, corporation, association, or any other business
organization.
(8) "Premises" means those locations where, by applicable law, financial institutions are authorized
to maintain a principal place of business and other offices for the conduct of their respective businesses.
(9) (a) "Satellite terminal" means any machine or device that is located off the premises of a
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financial institution and that a financial institution or its customers may use to carry out electronic funds
transfers.
(b) Satellite terminal The term includes:
(i) an automated teller machine, which means a satellite terminal to make electronic funds
transfers, that is located off the premises of financial institutions, operated by customers of financial institutions
without assistance, and activated by a unique identification device and personal identification number;
(ii) an interactive teller machine as defined in 32-1-109; and
(ii)(iii) a point-of-sale terminal, which means a satellite terminal located on the premises of a
merchant, operated by a customer, a merchant, or the merchant's employees solely to debit or credit a
customer's deposit or share account in a financial institution and solely to credit or debit the merchant's account
commensurately for transactions in goods or services. A point-of-sale terminal need not be activated by a
unique personal identification device. A merchant has the option, if the necessary computer capability exists at
a reasonable cost, of selling goods or services by point-of-sale terminals with the electronic funds transfer
taking effect at the time of the transaction or at a stated time after the transaction.
(c) The definition of satellite terminal does not include and nothing in this chapter may be
construed to apply to:
(i) an automated teller machine or interactive teller machine located on the premises of a financial
institution;
(ii) an automated clearinghouse or any equivalent system designed to transfer funds between
financial institutions; or
(iii) a point-of-sale terminal that is used by a merchant in the merchant's business only and does
not provide access to a financial institution.
(10) "Unique identification device" means a magnetic encoded plastic card or equivalent device that
contains either a number or a dollar balance, or both, that is unique to a customer and that is issued by a
financial institution, merchant, or other person."
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I hereby certify that the within bill,
HB 434, originated in the House.
___________________________________________
Chief Clerk of the House
___________________________________________
Speaker of the House
Signed this _______________________________day
of____________________________________, 2025.
___________________________________________
President of the Senate
Signed this _______________________________day
of____________________________________, 2025.
HOUSE BILL NO. 434
INTRODUCED BY K. WALSH, S. ESSMANN
AN ACT REVISING BANKING LAWS TO PROVIDE THAT AN INTERACTIVE TELLER MACHINE DOES NOT
CONSTITUTE A BRANCH BANK UNDER CERTAIN CIRCUMSTANCES; DEFINING INTERACTIVE TELLER
MACHINE; REVISING DEFINITIONS; AND AMENDING SECTIONS 32-1-109 AND 32-6-103, MCA.