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SENATE BILL 1870
By Johnson
HOUSE BILL 2537
By Lamberth
HB2537
011266
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AN ACT to amend Tennessee Code Annotated, Title 45,
Chapter 2; Title 45, Chapter 4 and Title 45,
Chapter 7, relative to financial institutions.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:
SECTION 1. Tennessee Code Annotated, Section 45-2-1602(a)(1), is amended by
deleting the language"; provided, that a full-scope examination, as set out in subsection (b),
shall be conducted by the commissioner or the commissioner's designee at least once in every
three (3) years".
SECTION 2. Tennessee Code Annotated, Section 45-2-1602(a)(2), is amended by
deleting the subdivision and substituting instead:
(2) The provision of subdivision (a)(1) requiring an examination at least once in
each year may be extended to up to twenty-four (24) months or such longer period as
determined by the commissioner. In making this determination, the commissioner
should consider the bank's quality of management, capitalization, risk profile and internal
controls, the examination cycle imposed by any applicable federal banking regulatory
authority, and any other factors the commissioner deems relevant.
SECTION 3. Tennessee Code Annotated, Section 45-4-505(a), is amended by deleting
the subsection and substituting instead:
(a) Any credit union organized under this chapter shall, prior to commencing its
operations, obtain and thereafter maintain insurance of its share and deposit balances
by membership in the National Credit Union Association, unless otherwise determined
by the commissioner pursuant to subsection (c).
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SECTION 4. Tennessee Code Annotated, Section 45-4-505, is amended by adding the
following as new subsections:
(c) The commissioner may determine the type, amounts, and other
characteristics of share insurance required to be maintained by each state credit union.
In making the determination, the commissioner shall consider the following factors:
(1) The safety and soundness of the state credit union;
(2) The ability of the state credit union to promote the economic progress
of this state;
(3) Public confidence in the credit union system;
(4) The views of the credit union industry in this state; and
(5) Any other factors the commissioner may deem relevant.
(d) The commissioner may promulgate rules to implement this section. The
rules must be promulgated in accordance with the Uniform Administrative Procedures
Act, compiled in title 4, chapter 5.
SECTION 5. Tennessee Code Annotated, Section 45-4-703, is amended by deleting
subsection (d) and by deleting the first sentence of subsection (e).
SECTION 6. Tennessee Code Annotated, Section 45-4-1002(a), is amended by
deleting the subsection and substituting instead:
(a) The commissioner shall either personally or by competent examiner
appointed by the commissioner visit and examine every credit union subject to the
commissioner's supervision at least once each year; provided, that this provision
requiring examination at least once in each year may be extended to up to twenty-four
(24) months or such longer period as determined by the commissioner. In making this
determination, the commissioner should consider the credit union's quality of
management, capitalization, internal controls, the examination cycle imposed by any
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applicable federal credit union regulatory authority, and any other factors the
commissioner deems relevant. The commissioner may order examinations and shall, at
all times, be given free access to all the books, papers, securities, and other sources of
information in respect to the credit union. For that purpose, the commissioner shall have
the power to subpoena and examine, personally or through a deputy duly authorized,
witnesses on oath and documents pertaining to the business of the credit union. The
commissioner may have follow-up examinations and visitations conducted on a credit
union if the commissioner believes that the examinations and visitations are necessary
to protect the interests of the members of the credit union.
SECTION 7. Tennessee Code Annotated, Title 45, Chapter 4, Part 11, is amended by
deleting the part in its entirety.
SECTION 8. Tennessee Code Annotated, Section 45-4-1210(a), is amended by
deleting the language "an annual examination" and substituting instead "examination in
accordance with § 45-4-1002(a)".
SECTION 9. Tennessee Code Annotated, Section 45-7-104(6), is amended by deleting
the subdivision and substituting instead:
(6) A federally insured depository financial institution, bank holding company,
office of an international banking corporation, foreign bank that establishes a federal
branch pursuant to 12 U.S.C. § 3102, corporation organized pursuant to the Bank
Service Company Act (12 U.S.C. §§ 1861-1867), or corporation organized under the
Edge Act (12 U.S.C. §§ 611-633).
SECTION 10. This act takes effect upon becoming a law, the public welfare requiring it.