Code of Virginia - Title 6.1 Banking And Finance - Section 6.1-392.1 Acquisition of interests in credit card bank located in-state by general business corporation; cond...

§ 6.1-392.1. Acquisition of interests in credit card bank located in-state by general business corporation; cond...

A. A general business corporation may acquire and hold all or substantially all of the voting shares of a single credit card bank located in this Commonwealth when and for so long as the following conditions are satisfied:

1. The credit card bank whose stock is to be acquired shall comply with the provisions of subdivisions 1 and 2 of § 6.1-392, except that such credit card bank shall be created for the sole purpose of engaging in a multi-state credit card operation;

2. The credit card bank whose stock is to be acquired employs on the date of commencement of its banking business in this Commonwealth or will employ within one year of such date not less than forty persons in this Commonwealth in its business; provided, that there shall be counted in the number of persons to be so employed, new employees in this Commonwealth of the general business corporation. For the purposes of this subsection, "new employees" shall be defined as including only those employees of the general business corporation who were first employed within Virginia no more than nine months before the Commission approved the acquisition pursuant to subdivision 7 of this subsection;

3. The credit card bank whose stock is to be acquired shall not accept demand deposits or deposits that the depositor may withdraw by check or similar means for payment to third parties or others;

4. The credit card bank whose stock is to be acquired shall not accept any savings or time deposits of less than $100,000 but may accept such deposits of $100,000 or more only from affiliates of the credit card bank having their principal places of business outside of this Commonwealth; however, the Commission shall not issue a Certificate of Authority authorizing the commencement of business of any credit card bank created in accordance with the provisions of this section unless it has determined that such deposits are to be insured or guaranteed by a federal agency up to the limits of the insurance provided thereby;

5. The credit card bank whose stock is to be acquired shall not engage in the business of making commercial loans;

6. The credit card bank whose stock is to be acquired is operated in a manner and at a location that is not likely to attract customers from the general public in this Commonwealth to the substantial detriment of existing banking institutions located in this Commonwealth; however, such credit card bank may be operated in a manner likely to attract and retain the credit card transaction business of customers with whom that credit card bank, or the general business corporation acquiring that credit card bank, has or has had business relations; and

7. Such general business corporation has received the prior approval of the Commission for the acquisition.

B. Any general business corporation proposing an acquisition pursuant to this section shall file an application with the Commission for approval to make such acquisition. The application shall be in such form as the Commission may prescribe from time to time. Such application shall specifically acknowledge the applicant's agreement to be bound by the conditions set forth in this section. In addition, such application shall designate a resident of this Commonwealth as the applicant's registered agent in connection with matters arising out of this chapter and shall be accompanied by a filing fee of $10,000.

C. An institution created in accordance with this chapter shall be a bank within the meaning of § 6.1-4 but shall at all times remain subject to the restrictions and limitations on its authority as set forth in this chapter. A credit card bank acquired in accordance with this chapter may impose charges as permitted by § 6.1-330.78, but for purposes of § 6.1-39.3 and Chapter 15 (§ 6.1-398 et seq.) of this title shall not be considered a bank. A credit card bank shall be subject to the provisions of Chapter 2 (§ 6.1-3 et seq.) of this title except where any rights, powers, privileges or provisions of Chapter 2 are inconsistent with the rights, powers, privileges, provisions or limitations of this chapter, in which case this chapter shall govern.

D. Upon determination that any general business corporation is holding stock in a credit card bank located in the Commonwealth in violation of the conditions set forth in this section or its agreement pursuant to § 6.1-393, the Commissioner shall have authority to take remedial action, including an order to divest such stock, in the same manner and under the same terms and conditions as are applicable to out-of-state bank holding companies or subsidiaries thereof pursuant to § 6.1-396.

E. A credit card bank acquired by a general business corporation pursuant to this section shall annually, not later than January 31 of each year, file with the Commissioner a certificate of compliance which shall be executed by the appropriate officers of the credit card bank and attested to under oath by at least three of the directors of the credit card bank. A certificate of compliance shall specifically certify that the credit card bank is in compliance with all the requirements, restrictions and limitations set forth in this section and such other matters as may be required by the Commissioner.

(1989, c. 751; 1989, Sp. Sess., cc. 4, 7; 1992, c. 283.)

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Last modified: April 16, 2009