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U.S. Code as of:
01/19/04
Section 3103. Interstate banking by foreign banks
(a) Interstate branching and agency operations
(1) Federal branch or agency
Subject to the provisions of this chapter and with the prior
written approval by the Board and the Comptroller of the Currency
of an application, a foreign bank may establish and operate a
Federal branch or agency in any State outside the home State of
such foreign bank to the extent that the establishment and
operation of such branch would be permitted under section 36(g)
of this title or section 1831u of this title if the foreign bank
were a national bank whose home State is the same State as the
home State of the foreign bank.
(2) State branch or agency
Subject to the provisions of this chapter and with the prior
written approval by the Board and the appropriate State bank
supervisor of an application, a foreign bank may establish and
operate a State branch or agency in any State outside the home
State of such foreign bank to the extent that such establishment
and operation would be permitted under section 1828(d)(4) or
1831u of this title if the foreign bank were a State bank whose
home State is the same State as the home State of the foreign
bank.
(3) Criteria for determination
In approving an application under paragraph (1) or (2), the
Board and (in the case of an application under paragraph (1)) the
Comptroller of the Currency -
(A) shall apply the standards applicable to the establishment
of a foreign bank office in the United States under section
3105(d) of this title;
(B) may not approve an application unless the Board and (in
the case of an application under paragraph (1)) the Comptroller
of the Currency -
(i) determine that the foreign bank's financial resources,
including the capital level of the bank, are equivalent to
those required for a domestic bank to be approved for
branching under section 36 of this title and section 1831u of
this title; and
(ii) consult with the Secretary of the Treasury regarding
capital equivalency; and
(C) shall apply the same requirements and conditions to which
an application for an interstate merger transaction is subject
under paragraphs (1), (3), and (4) of section 1831u(b) of this
title.
(4) Operation
Subsections (c) and (d)(2) of section 1831u of this title shall
apply with respect to each branch and agency of a foreign bank
which is established and operated pursuant to an application
approved under this subsection in the same manner and to the same
extent such provisions of such section apply to a domestic branch
of a national or State bank (as such terms are defined in section
1813 of this title) which resulted from a merger transaction
under such section 1831u of this title.
(5) Exclusive authority for additional branches
Except as provided in this section, a foreign bank may not,
directly or indirectly, acquire, establish, or operate a branch
or agency in any State other than the home State of such bank.
(6) Requirement for a separate subsidiary
If the Board or the Comptroller of the Currency, taking into
account differing regulatory or accounting standards, finds that
adherence by a foreign bank to capital requirements equivalent to
those imposed under section 36 of this title and section 1831u of
this title could be verified only if the banking activities of
such bank in the United States are carried out in a domestic
banking subsidiary within the United States, the Board and (in
the case of an application under paragraph (1)) the Comptroller
of the Currency may approve an application under paragraph (1) or
(2) subject to a requirement that the foreign bank or company
controlling the foreign bank establish a domestic banking
subsidiary in the United States.
(7) Additional authority for interstate branches and agencies of
foreign banks, upgrades of certain foreign bank agencies and
branches
Notwithstanding paragraphs (1) and (2), a foreign bank may -
(A) with the approval of the Board and the Comptroller of the
Currency, establish and operate a Federal branch or Federal
agency or, with the approval of the Board and the appropriate
State bank supervisor, a State branch or State agency in any
State outside the foreign bank's home State if -
(i) the establishment and operation of such branch or
agency is permitted by the State in which the branch or
agency is to be established; and
(ii) in the case of a Federal or State branch, the branch
receives only such deposits as would be permitted for a
corporation organized under section 25A of the Federal
Reserve Act [12 U.S.C. 611 et seq.]; or
(B) with the approval of the Board and the relevant licensing
authority (the Comptroller in the case of a Federal branch or
the appropriate State supervisor in the case of a State
branch), upgrade an agency, or a branch of the type referred to
in subparagraph (A)(ii), located in a State outside the foreign
bank's home State, into a Federal or State branch if -
(i) the establishment and operation of such branch is
permitted by such State; and
(ii) such agency or branch -
(I) was in operation in such State on the day before
September 29, 1994; or
(II) has been in operation in such State for a period of
time that meets the State's minimum age requirement
permitted under section 1831u(a)(5) of this title.
(8) Continuing requirement for meeting community credit needs
after initial interstate entry by acquisition
(A) In general
If a foreign bank acquires a bank or a branch of a bank, in a
State in which the foreign bank does not maintain a branch, and
such acquired bank is, or is part of, a regulated financial
institution (as defined in section 803 of the Community
Reinvestment Act of 1977 [12 U.S.C. 2902]), the Community
Reinvestment Act of 1977 [12 U.S.C. 2901 et seq.] shall
continue to apply to each branch of the foreign bank which
results from the acquisition as if such branch were a regulated
financial institution.
(B) Exception for branch that receives only deposits
permissible for an Edge Act corporation
Paragraph (1) shall not apply to any branch that receives
only such deposits as are permissible for a corporation
organized under section 25A of the Federal Reserve Act [12
U.S.C. 611 et seq.] to receive.
(9) Home State of domestic bank defined
For purposes of this subsection, the term "home State" means -
(A) with respect to a national bank, the State in which the
main office of the bank is located; and
(B) with respect to a State bank, the State by which the bank
is chartered.
(b) Continuance of lawful interstate banking operations previously
commenced
Unless its authority to do so is lawfully revoked otherwise than
pursuant to this section, a foreign bank, notwithstanding any
restriction or limitation imposed under subsection (a) of this
section, may establish and operate, outside its home State, any
State branch, State agency, or bank or commercial lending company
subsidiary which commenced lawful operation or for which an
application to commence business had been lawfully filed with the
appropriate State or Federal authority, as the case may be, on or
before July 27, 1978. Notwithstanding subsection (a) of this
section, a foreign bank may continue to operate, after September
29, 1994, any Federal branch, State branch, Federal agency, State
agency, or commercial lending company subsidiary which such bank
was operating on the day before September 29, 1994, to the extent
the branch, agency, or subsidiary continues, after September 29,
1994, to engage in operations which were lawful under the laws in
effect on the day before September 29, 1994.
(c) Determination of home State of foreign bank
For the purposes of this section -
(1) in the case of a foreign bank that has any branch, agency,
subsidiary commercial lending company, or subsidiary bank in more
than 1 State, the home State of the foreign bank is the 1 State
of such States which is selected to be the home State by the
foreign bank or, in default of any such selection, by the Board;
and
(2) in the case of a foreign bank that does not have a branch,
agency, subsidiary commercial lending company, or subsidiary bank
in more than 1 State, the home State of the foreign bank is the
State in which the foreign bank has a branch, agency, subsidiary
commercial lending company, or subsidiary bank.
(d) Clarification of branching rules in case of foreign bank with
domestic bank subsidiary
In the case of a foreign bank that has a domestic bank subsidiary
within the United States -
(1) the fact that such bank controls a domestic bank shall not
affect the authority of the foreign bank to establish Federal and
State branches or agencies to the extent permitted under
subsection (a) of this section; and
(2) the fact that the domestic bank is controlled by a foreign
bank which has Federal or State branches or agencies in States
other than the home State of such domestic bank shall not affect
the authority of the domestic bank to establish branches outside
the home State of the domestic bank to the extent permitted under
section 36(g) of this title or section 1828(d)(4) or 1831u of
this title, as the case may be.
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