North Carolina General Statutes Chapter 53C Regulation of Banks

Article 1 - General Provisions.

N.C. Gen. Stat. § 53C-1-1. Title
This Chapter shall be known and may be cited as Regulation of Banks and Other Financial Services. (2012-56, s. 4.)
N.C. Gen. Stat. § 53C-1-2. Scope and applicability of Chapter
(a) Unless the context specifies otherwise, this Chapter shall apply to the following: (1) All existing banks organized or created under the laws of...
N.C. Gen. Stat. § 53C-1-3. Existing banks; prohibitions, injunctions
(a) No depository institution organized or created under the laws of this State may operate as a bank except in accordance with this Chapter....
N.C. Gen. Stat. § 53C-1-4. Definitions and application of terms
Unless the context requires otherwise, the following definitions apply in this Chapter: (1) Acquire. - To obtain the right or power to vote or...
N.C. Gen. Stat. § 53C-1-5. Severability
If any provision of this Chapter is found by any court of competent jurisdiction to be invalid as to any person or circumstance, or...

Article 2 - Commission and Commissioner.

N.C. Gen. Stat. § 53C-2-1. The Commission
(a) The Commission consists of 15 members, including the State Treasurer, who shall serve as an ex officio member; 12 members appointed by the...
N.C. Gen. Stat. § 53C-2-2. The Commissioner
(a) Effective April 1, 2011, and quadrennially thereafter, the Governor shall appoint a Commissioner, which appointment shall be subject to confirmation by the General...
N.C. Gen. Stat. § 53C-2-3. The Office of the Commissioner of Banks
(a) The Commissioner shall be assisted in the performance of the duties of office by (i) one or more deputy commissioners and (ii) examiners,...
N.C. Gen. Stat. § 53C-2-4. Administration of the Office of the Commissioner of Banks
(a) As authorized in Chapters 54B, 54C, and this Chapter, the OCOB shall be funded by annual or periodic assessments, licensing fees and charges,...
N.C. Gen. Stat. § 53C-2-5. Rule making
(a) The Commissioner, subject to review and approval by the Commission, may make all necessary rules with respect to the establishment, operation, conduct, and...
N.C. Gen. Stat. § 53C-2-6. Hearings and appeals
(a) Any administrative hearing required or permitted to be held by the Commissioner shall be conducted in accordance with Article 3A of Chapter 150B...
N.C. Gen. Stat. § 53C-2-7. Official record
(a) The Commissioner shall keep a record in the OCOB of the Commissioner's official acts, rulings, and transactions that, except as otherwise provided, shall...

Article 3 - Organization of a Bank.

N.C. Gen. Stat. § 53C-3-1. Application to organize a bank
(a) An applicant for permission to organize a bank and for a charter must file an application with the Commissioner. The application shall be...
N.C. Gen. Stat. § 53C-3-2. Permission to organize a bank
(a) With the approval of the Commissioner, the organizers may file articles of incorporation for the proposed bank with the Secretary of State. The...
N.C. Gen. Stat. § 53C-3-3. Articles of incorporation of a proposed bank
(a) The articles of incorporation of a proposed bank shall be signed and acknowledged by or on behalf of an organizer and shall contain...
N.C. Gen. Stat. § 53C-3-4. Commissioner's approval of charter issuance
(a) The Commissioner may approve a charter for a proposed bank only when the Commissioner has determined that all the following requirements have been...
N.C. Gen. Stat. § 53C-3-5. Notice; public hearing
(a) Not less than 30 days before the public hearing of the Commission to review the Commissioner's approval of an application, the applicant shall...
N.C. Gen. Stat. § 53C-3-6. Commission decision
(a) The Commission shall consider the findings and order of the Commissioner, oral testimony, and any other information and evidence, either written or oral,...
N.C. Gen. Stat. § 53C-3-7. Issuance of charter
(a) A proposed bank shall not engage in business except as allowed under G.S. 53C-3-2(c)(1), until it receives a charter issued by the Commissioner....

Article 4 - Governance of Banks.

N.C. Gen. Stat. § 53C-4-1. Banks - Form of organization
(a) A bank shall be formed as, and shall maintain the form of, a corporation formed under the laws of this State. (b) The...
N.C. Gen. Stat. § 53C-4-2. Banks controlled by boards of directors
(a) The corporate powers of a bank shall be exercised by or under the authority of, and the business and affairs of the bank...
N.C. Gen. Stat. § 53C-4-3. Committees of boards of directors
(a) The board of directors shall appoint, at a minimum, an audit committee, an executive committee, and a loan committee (which may be the...
N.C. Gen. Stat. § 53C-4-4. Minutes of meetings of directors and committees
Minutes shall be recorded and retained for all meetings of the board of directors and board committees and kept on file at the bank....
N.C. Gen. Stat. § 53C-4-5. Qualifications of bank directors
(a) At least three-fourths of the directors of a bank shall be citizens of the United States of America. (b) A director must satisfy...
N.C. Gen. Stat. § 53C-4-6. Liability of directors
(a) The standard of conduct for directors shall be as set forth in G.S. 55-8-30. (b) Any director of any bank who shall knowingly...
N.C. Gen. Stat. § 53C-4-7. Directors may declare distributions
Provided a bank does not make distributions that reduce its capital below its applicable required capital, the board of directors of a bank may...
N.C. Gen. Stat. § 53C-4-8. Officers and employees shall give bond
(a) A bank shall require security in the form of a bond for the fidelity and faithful performance of duties by its officers and...
N.C. Gen. Stat. § 53C-4-9. Affiliate transactions
A bank may extend credit to, and engage in transactions with, its affiliates, directors, executive officers, principal shareholders, and their respective immediate family members...
N.C. Gen. Stat. § 53C-4-10. Examination of board composition, structure, and conduct
(a) As part of its examinations of a bank, the OCOB may assess the competence, composition, structure, and conduct of such bank's board of...
N.C. Gen. Stat. § 53C-4-11. Reserve fund
(a) Each bank shall maintain a reserve fund as follows: (1) If the bank is a member of the Federal Reserve System, it shall...
N.C. Gen. Stat. § 53C-4-12. Compliance review committee
(a) For purposes of this section, the following definitions apply: (1) "Compliance review committee" means an audit, loan review, or compliance committee appointed by...
N.C. Gen. Stat. § 53C-4-13. Immediate report of changes in directors and certain officers
Each bank shall report to the Commissioner any changes in its (i) directors, (ii) president, (iii) chief executive officer, (iv) chief financial officer, (v)...

Article 5 - Powers of Banks.

N.C. Gen. Stat. § 53C-5-1. Powers
(a) Except as otherwise specifically provided by this Chapter, a bank shall have the powers conferred upon business corporations organized under the laws of...
N.C. Gen. Stat. § 53C-5-2. Investment authority
(a) In addition to any powers or investments authorized by any other section of this Chapter, a bank may invest in the following: (1)...
N.C. Gen. Stat. § 53C-5-3. Banks, fiduciaries authorized to invest in securities approved by the Secretary of Housing and Urban Development, Federal Housing Administration, Veterans Administration
(a) Insured Mortgages and Obligation of National Mortgage Associations and Federal Home Loan Banks. - It shall be lawful for all commercial and industrial...

Article 6 - Bank Operations.

N.C. Gen. Stat. § 53C-6-1. Loans and extensions of credit
(a) A bank may make a loan or extension of credit secured by the pledge of its own shares or the shares of its...
N.C. Gen. Stat. § 53C-6-2. Deposits
(a) A bank may, consistent with applicable law and safe and sound banking practices, offer all types of deposit accounts upon such terms and...
N.C. Gen. Stat. § 53C-6-3. Securing deposits
(a) A bank may not create a lien on its assets or otherwise secure the repayment of a deposit, except as authorized or required...
N.C. Gen. Stat. § 53C-6-4. Minors
(a) A bank may issue and operate a deposit account in the name of a minor or in the name of two or more...
N.C. Gen. Stat. § 53C-6-5. Reserved for future codification purposes
N.C. Gen. Stat. § 53C-6-6. Joint accounts
(a) Any two or more individuals may establish a joint deposit account by written contract. The deposit account shall be held for them as...
N.C. Gen. Stat. § 53C-6-7. Payable on Death accounts
(a) If any natural person establishing a deposit account shall execute a written agreement with the bank containing a statement that it is executed...
N.C. Gen. Stat. § 53C-6-8. Personal agency accounts
(a) Any person may establish a personal agency account by written contract containing a statement that it is executed pursuant to the provisions of...
N.C. Gen. Stat. § 53C-6-9. Accounts opened by adults for minors
(a) One or more adults may open and maintain a custodial deposit account for or in the name of a minor and using the...
N.C. Gen. Stat. § 53C-6-10. Payment of balance of deceased person or person under disability to personal representative or guardian
(a) A bank may pay any balance on deposit to the credit of any deceased individual to the duly qualified personal representative, collector, or...
N.C. Gen. Stat. § 53C-6-11. Powers of attorney; notice of revocation; payment after notice
(a) Any bank may continue to recognize any act of an attorney-in-fact or other agent until the bank receives actual notice of the principal's...
N.C. Gen. Stat. § 53C-6-12. Account statements to be rendered annually or on request
(a) Every bank shall render an account statement for each deposit account at least annually to the depositor; provided, however, the statements are not...
N.C. Gen. Stat. § 53C-6-13. Safe deposit boxes; unpaid rentals; procedure; escheats
(a) If the rental due on a safe deposit box is 90 days or more past due, the lessor bank may send a notice...
N.C. Gen. Stat. § 53C-6-14. Reproduction and retention of records; admissibility of copies in evidence; disposition of originals; record production generally
(a) Any bank may cause any or all records kept by it to be recorded, copied, or reproduced by any photographic, reproduction, electronic, or...
N.C. Gen. Stat. § 53C-6-15. Establishment of branches
(a) A bank may establish one or more branches in this State, whether de novo or by acquisition of existing branches of another depository...
N.C. Gen. Stat. § 53C-6-16. Change of location of a branch or principal office
(a) A bank may change the location of its principal office or a branch with the prior written approval of the Commissioner. A request...
N.C. Gen. Stat. § 53C-6-17. Branch closings
A bank may close a branch upon providing written notice to the Commissioner and the customers of the branch at least 90 days prior...
N.C. Gen. Stat. § 53C-6-18. Non-branch bank business offices
(a) A bank may establish one or more non-branch bank business offices as defined by G.S. 53C-1-4(46): (1) If a proposed non-branch bank business...
N.C. Gen. Stat. § 53C-6-19. Operations; suspension
(a) A bank, any of its branches, and any of its non-branch bank business offices may operate on such days and during such hours,...

Article 7 - Control Transactions; Combinations; Conversions.

N.C. Gen. Stat. § 53C-7-101. Control transactions
(a) Except as otherwise expressly permitted by this section, a person shall not engage in a control transaction, as defined by G.S. 53C-1-4(22), involving...
N.C. Gen. Stat. § 53C-7-102. Application regarding a control transaction
(a) A person seeking approval of a control transaction involving a bank under this Article shall file the following with the Commissioner: (1) An...
N.C. Gen. Stat. § 53C-7-103. Public notice
A person filing an application for approval of a control application shall publish a public notice of the filing of the application not more...
N.C. Gen. Stat. § 53C-7-104. Actions on control transaction applications
(a) The Commissioner shall examine the proposed control transaction, including the character, competence, and experience of the acquiring person and its proposed management personnel,...
N.C. Gen. Stat. § 53C-7-105. Appeal
Any order of the Commissioner denying an application for approval of a control transaction may be appealed to the Commission by the person filing...
N.C. Gen. Stat. § 53C-7-201. Combination authority
With the approval of the Commissioner, a bank may combine with one or more depository institutions or non-depository institutions, provided that the bank is...
N.C. Gen. Stat. § 53C-7-202. Combination application and investigation
(a) A bank seeking approval of a combination shall file with the Commissioner an application for approval, copies of the agreement under which the...
N.C. Gen. Stat. § 53C-7-203. Decision on application
Based on the application and the Commissioner's examination, the Commissioner shall enter an order approving or denying approval of the proposed combination not later...
N.C. Gen. Stat. § 53C-7-204. Interim banks
The Commissioner may approve an application to organize an interim bank solely for the purpose of effecting a combination under this Article. No interim...
N.C. Gen. Stat. § 53C-7-205. Fiduciary powers and liabilities in a combination or a transferring of assets and liabilities
Whenever any depository institution or any trust institution shall combine with or shall sell to and transfer its assets and liabilities to any other...
N.C. Gen. Stat. § 53C-7-206. Combination with federally chartered institution
A combination by a bank with a federally chartered institution in which the federally chartered institution will be the surviving party shall be subject...
N.C. Gen. Stat. § 53C-7-207. Combination with a subsidiary
(a) Except as provided in subsection (c) of this section, a bank proposing to do any of the following combinations shall give prior written...
N.C. Gen. Stat. § 53C-7-208. Repealed by Session Laws 2013-29, s. 18, effective April 16, 2013
N.C. Gen. Stat. § 53C-7-209. Appeal
Any order of the Commissioner denying an application for approval of a combination may be appealed to the Commission by a party to the...
N.C. Gen. Stat. § 53C-7-301. Conversion to a North Carolina bank charter
(a) Any depository institution that is not a bank may apply to the Commissioner for permission to convert into a bank and for certification...
N.C. Gen. Stat. § 53C-7-302. Appeal
Any order of the Commissioner denying an application for approval of a conversion to a bank may be appealed to the Commission by the...
N.C. Gen. Stat. § 53C-7-303. Conversion by North Carolina bank
(a) A bank may convert to another form of depository institution under the laws of this State, of another state, or the United States...

Article 8 - Bank Supervision.

N.C. Gen. Stat. § 53C-8-1. Commissioner has authority to supervise banks
(a) Every bank shall be under the supervision of the Commissioner. It shall be the Commissioner's duty to enforce the banking laws through the...
N.C. Gen. Stat. § 53C-8-2. Assessments and fees
Banks shall pay the following assessments and fees into the OCOB within 10 days after receipt of an invoice: (1) Annual assessments. - Each...
N.C. Gen. Stat. § 53C-8-3. Reports required of banks
(a) Each bank shall file the following with the Commissioner, at such times, on such forms, and in such formats as the Commissioner may...
N.C. Gen. Stat. § 53C-8-4. Examination by Commissioner
(a) The Commissioner may examine everything relating to the business of a bank or its holding company, and may appoint examiners to make such...
N.C. Gen. Stat. § 53C-8-5. Examination of affiliates
The Commissioner, at his or her discretion, may examine the affiliates of a bank to the extent it is necessary to safeguard the interest...
N.C. Gen. Stat. § 53C-8-6. Access to books and records; right to issue subpoenas, administer oaths, and examine witnesses
(a) The Commissioner and the Commissioner's examiners and agents: (1) Shall have free access to all books and records of a bank, its holding...
N.C. Gen. Stat. § 53C-8-7. Examiner making false report
If any bank examiner shall knowingly and willfully make any false or fraudulent report of the condition of any bank that the examiner has...
N.C. Gen. Stat. § 53C-8-8. Examiner disclosing confidential information
If any examiner or other employee of the OCOB fails to keep secret the facts and information obtained in the course of an examination...
N.C. Gen. Stat. § 53C-8-9. Loans or gratuities forbidden
(a) No bank, or any officer, director, employee, or affiliate thereof, shall make an extension of credit or grant any gratuity to the Commissioner,...
N.C. Gen. Stat. § 53C-8-10. Willfully and maliciously making derogatory reports
Any person who shall willfully and maliciously make, circulate, transmit, or otherwise communicate any statement, rumor, or suggestion to one or more other persons...
N.C. Gen. Stat. § 53C-8-11. Misapplication, embezzlement of funds
(a) Any person who, with intent to defraud or injure a bank or any other person or with intent to deceive an officer of...
N.C. Gen. Stat. § 53C-8-12. Enforcement of the banking laws
(a) When the Commissioner believes that a violation of the banking laws has occurred or is continuing, the Commissioner may order an examination or...
N.C. Gen. Stat. § 53C-8-13. Immediate action orders
(a) In the event that the Commissioner determines that a bank has inadequate capital or insufficient capital or determines that immediate action is necessary...
N.C. Gen. Stat. § 53C-8-14. Supervisory control
(a) Whenever the Commissioner determines that a bank has insufficient capital and is conducting its business in an unsafe or unsound manner or in...
N.C. Gen. Stat. § 53C-8-15. Removal of directors, officers, and employees
(a) If the Commissioner determines that a director, officer, or employee of a bank has participated in or consented to any violation of this...
N.C. Gen. Stat. § 53C-8-16. Emergency powers
In the event of a natural disaster or other national, regional, state, or local emergency, the Commissioner may temporarily waive or suspend requirements for...
N.C. Gen. Stat. § 53C-8-17. Interstate regulatory agreements
The Commissioner may enter into cooperative, coordinating, and information sharing agreements with (i) any bank supervisory agency having jurisdiction over an out-of-state bank that...

Article 9 - Supervisory Liquidation; Voluntary Dissolution and Liquidation.

N.C. Gen. Stat. § 53C-9-101. Supervisory combinations
Notwithstanding any other provision of this Chapter, in order to protect the public, including depositors and creditors of a bank, the Commissioner, upon making...
N.C. Gen. Stat. § 53C-9-102. Distributions; assignments restricted
A bank that is in the process of involuntary or voluntary dissolution pursuant to this Article may not make or pay distributions to its...
N.C. Gen. Stat. § 53C-9-103. Cancellation of charter
Whenever a combination, dissolution, or other transaction occurs by which a bank ceases to exist or ceases to be eligible for a charter, the...
N.C. Gen. Stat. § 53C-9-201. Voluntary dissolution prior to receipt of charter
A bank in formation may, prior to issuance of its charter, give notice to the Commissioner and, with the Commissioner's consent, abandon its application...
N.C. Gen. Stat. § 53C-9-202. Voluntary dissolution
(a) With the approval of the Commissioner, a bank may engage in a voluntary dissolution and liquidation. (b) If, by a majority vote, the...
N.C. Gen. Stat. § 53C-9-203. Voluntary dissolution and liquidation procedure
(a) At the appropriate time, the Commissioner shall do the following: (1) Inform the FDIC and the bank's federal supervisory agency if other than...
N.C. Gen. Stat. § 53C-9-301. Receivership
(a) The Commissioner may take custody of the books, records, and assets of every kind and character of any bank in the instances established...
N.C. Gen. Stat. § 53C-9-401. Statute relating to receivers applicable to insolvent banks
The provisions of G.S. 1-507.1 through 1-507.11, relating to receivers, when not inconsistent with the provisions of this Article, shall apply to the liquidation...
N.C. Gen. Stat. § 53C-9-402. Storage and destruction of records
(a) Any record of a bank that is in or has completed the process of dissolution and liquidation may be kept in compliance with...
N.C. Gen. Stat. § 53C-9-403. Authority to serve as trustee terminated
Whenever any bank that has been, or shall be, appointed trustee in any indenture, deed of trust, or other instrument of like character, executed...
N.C. Gen. Stat. § 53C-9-404. Petition for new trustee; upon parties interested
In all cases of dissolution receivership and liquidation under this Article, the clerk of superior court of any county in which an indenture, deed...
N.C. Gen. Stat. § 53C-9-405. Appointment of substitute trustee where no objection made
If, upon the day fixed in the notice, no person appears and objects to the appointment of a substitute trustee, the clerk of superior...
N.C. Gen. Stat. § 53C-9-406. Hearing where objection made; appeal from order
If objection is made to the appointment of a new trustee under this Part, the clerk shall hear and determine the matter, and from...
N.C. Gen. Stat. § 53C-9-407. Registration of final order
The final order of appointment of a new trustee or trustees under this Part shall be certified by the clerk of superior court issuing...
N.C. Gen. Stat. § 53C-9-408. Petition and order applicable to all instruments involved
The petition and the order appointing a new trustee or trustees under this Part may apply to any number of indentures, deeds of trust,...
N.C. Gen. Stat. § 53C-9-409. Additional remedy
The appointment of a substitute trustee as described in this Part shall be in addition to and not substitution for any other remedy provided...

Article 10 - Bank Holding Companies.

N.C. Gen. Stat. § 53C-10-101. Holdings companies
Every holding company, as defined in G.S. 53C-1-4(39), of a bank shall register with the Commissioner and maintain that registration on an annual basis...
N.C. Gen. Stat. § 53C-10-102. Holding company control transaction
(a) Except as otherwise expressly permitted by this section, a person shall not engage in a control transaction to which a holding company formed...
N.C. Gen. Stat. § 53C-10-103. Application regarding a control transaction
(a) A person seeking approval of a control transaction to which a holding company of a bank is a party under this Article shall...
N.C. Gen. Stat. § 53C-10-104. Public notice
A person filing an application for approval of a control transaction shall publish a public notice of the filing of the application not more...
N.C. Gen. Stat. § 53C-10-105. Actions on control transaction applications
(a) The Commissioner shall examine the proposed control transaction, including the character, competence, and experience of the acquiring person and its proposed management personnel,...
N.C. Gen. Stat. § 53C-10-106. Appeal
Any order of the Commissioner denying an application for approval of a control transaction may be appealed to the Commission by the person filing...
N.C. Gen. Stat. § 53C-10-201. Combination authority
With the approval of the Commissioner, a holding company of a bank may combine with one or more other holding companies or other companies....
N.C. Gen. Stat. § 53C-10-202. Combination application and investigation
(a) A holding company of a bank seeking approval of a combination shall file with the Commissioner an application for approval, copies of the...
N.C. Gen. Stat. § 53C-10-203. Decision on application
Based on the application and the Commissioner's examination, the Commissioner shall enter an order approving or denying approval of the proposed combination not later...
N.C. Gen. Stat. § 53C-10-204. Appeal
Any order of the Commissioner denying an application for approval of a combination may be appealed to the Commission by a party to the...
N.C. Gen. Stat. § 53C-10-301. Cease and desist order
Upon a finding that any action of a holding company subject to registration under this Article, or its nonbank affiliate, may be in violation...
N.C. Gen. Stat. § 53C-10-302. Other control changes
Each holding company of a bank shall report to the Commissioner any changes in its directors, president, chief executive officer, or chief financial officer...

Last modified: March 23, 2014