S T A T E   O F   N E W   Y O R K
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                                  4350

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                             March 21, 2013
                               ___________

Introduced  by  Sen.  FARLEY -- read twice and ordered printed, and when
  printed to be committed to the Committee on Banks

AN ACT to amend the banking law, in relation to making certain technical
  corrections thereto

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1. Section 6-i of the banking law, as added by chapter 571 of
the laws of 1986 and as further amended by section  104  of  part  A  of
chapter 62 of the laws of 2011, is amended to read as follows:
  S 6-i.  Mortgage  loans.  No person, partnership, corporation, banking
organization, exempt organization as defined  in  section  five  hundred
ninety  of  this  chapter  or other entity shall make a mortgage loan as
defined in section  five  hundred  ninety  of  this  chapter  except  in
conformity  with  the requirements of article twelve-D and in compliance
with such rules and regulations as may be promulgated by the superinten-
dent of financial services [or prescribed by the  superintendent]  under
this  section.  Nothing  in  this section shall be construed to limit or
otherwise modify any otherwise applicable requirement of state or feder-
al law.
  S 2. Subdivision 3 of section 7 of the banking law, as added by  chap-
ter  184  of  the  laws of 1978 and as further amended by section 104 of
part A of chapter 62 of the laws of 2011, is amended to read as follows:
  3. The superintendent of financial services may promulgate such  regu-
lations  as  [it]  HE OR SHE deems necessary and proper to implement and
define the provisions of this section.
  S 3. Subdivision 3 of section 9-f of the banking law,  as  amended  by
chapter 571 of the laws of 1986 and as further amended by section 104 of
part A of chapter 62 of the laws of 2011, is amended to read as follows:
  3. For the purposes of this section, the term (a) "prudent loan" means
a loan upon the security of real property which is prudent by acceptable
banking  standards  and  is  in compliance with all of the provisions of

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09332-01-3
              

S. 4350                             2

this chapter[,] AND RULES  AND  regulations  of  the  superintendent  of
financial  services  [and rules of the superintendent]; and (b) notwith-
standing any other provision of this chapter or law to the contrary, the
term  banking  institution  when  used  in  this  section shall mean and
include all banks, trust companies,  savings  banks,  savings  and  loan
associations,  credit  unions, mortgage bankers, exempt organizations as
defined in article twelve-D of this chapter and foreign  banking  corpo-
rations whether incorporated, chartered, organized or licensed under the
laws of this state or any other state or the United States.
  S  4.  Subdivision  2  of section 14-c of the banking law, as added by
chapter 19 of the laws of 1978 and as further amended by section 104  of
part A of chapter 62 of the laws of 2011, is amended to read as follows:
  2.  The  superintendent of financial services may alter or amend rules
and regulations or promulgate additional rules and regulations  as  [it]
HE  OR  SHE  deems  necessary and proper to effectuate the provisions of
subdivision one.
  S 5. Subdivisions 1, 2 and 3 of section 24 of the banking law,  subdi-
vision 1 as amended by chapter 453 of the laws of 1960, subdivision 2 as
amended  by chapter 419 of the laws of 1996, subdivision 3 as amended by
chapter 52 of the laws of 1944 and subdivisions 1, 2 and  3  as  further
amended  by section 104 of part A of chapter 62 of the laws of 2011, are
amended to read as follows:
  1. Within ninety days after the date when any organization certificate
or private banker's certificate shall have been filed  for  examination,
the  superintendent,  if  he  OR  SHE shall find after investigation and
examination of what [he] THE SUPERINTENDENT deems to be the best sources
of information at his OR HER command that the character,  responsibility
and  general  fitness of the person or persons named in such certificate
are such as to command confidence and warrant belief that  the  business
of the proposed corporation or private banker will be honestly and effi-
ciently  conducted  in  accordance  with  the intent and purpose of this
chapter, and that the public convenience and advantage will be  promoted
by  allowing  such  proposed  corporation or private banker to engage in
business, shall [submit] APPROVE such certificate [to the superintendent
of financial services together with all papers, correspondence and other
information in his possession relating thereto, including the results of
his investigation and his recommendation in the matter] AND ENDORSE UPON
EACH OF THE DUPLICATES THE DATE OF SUCH APPROVAL.  Such period of ninety
days may be extended, by a written consent executed by a majority of the
persons from whom the superintendent received such organization  certif-
icate  or  private  banker's certificate, for such additional reasonable
period of time as may be required for applicants to comply  with  condi-
tions precedent stipulated by the superintendent as being a prerequisite
to  his  [recommendation to the superintendent of financial services] OR
HER DETERMINATION.
  2. If [three-fifths of the members of the board,  after  consideration
of  all relevant information available to them, shall vote for approval,
the superintendent, if he is still satisfied,  upon  the  considerations
set  forth in subdivision one of this section, that such proposed corpo-
ration or private banker should be  permitted  to  engage  in  business,
shall  approve  such certificate and endorse upon each of the duplicates
the date of such approval. He] APPROVED, THE SUPERINTENDENT shall forth-
with cause notice of such approval to be given to the proposed  incorpo-
rators  or  private  banker  and one of the duplicate certificates to be
filed in the office of the department and the other in the office of the
clerk of the county in which  the  principal  office  of  such  proposed

S. 4350                             3

corporation  or  private  banker is to be located. [In a case in which a
private banker certificate is submitted to the  superintendent  for  the
purpose  of  continuing  the business in connection with a change in its
partnership, the superintendent shall approve the private banker certif-
icate  without  any  action  by the superintendent of financial services
upon making a determination that the private banker should be  permitted
to  continue  its  business  based  upon the considerations set forth in
subdivision one of this section.]
  3. If [three-fifths of the members of the superintendent of  financial
services  shall  not vote for approval, or if the superintendent, either
prior or subsequent to the submission of such certificate to the board,]
THE SUPERINTENDENT is not satisfied, upon the considerations  set  forth
in  subdivision  one  of this section, that such proposed corporation or
private banker should be permitted to engage  in  business,  the  super-
intendent  shall  refuse  such certificate and shall endorse thereon the
date of such refusal and return one of the duplicates  to  the  proposed
incorporators or private banker from whom such certificate was received.
  S 6. Subparagraph 12 of paragraph (a) of subdivision 3 of section 28-b
of the banking law, as amended by chapter 315 of the laws of 2008 and as
further  amended  by  section 104 of part A of chapter 62 of the laws of
2011, is amended to read as follows:
  (12) Other factors that, in the judgment of the  [superintendent  and]
superintendent of financial services, reasonably bear upon the extent to
which  a  banking institution is helping to meet the credit needs of its
entire community, including,  without  limitation,  the  banking  insti-
tution's participation in credit counseling services.
  S  7.  Subdivision  5  of section 28-b of the banking law, as added by
section 361 of the laws of 1984 and as further amended by section 104 of
part A of chapter 62 of the laws of 2011, is amended to read as follows:
  5. The superintendent of financial services is hereby  authorized  and
empowered[,  by  a  three-fifths vote of all its members,] to promulgate
rules and regulations  effectuating  the  provisions  of  this  section,
including  any  rules  and  regulations providing that the assessment of
banking institutions referred to in subdivision three  of  this  section
shall be made on a graduated numerical basis.
  S  8.  Subdivision 10 of section 100-c of the banking law, as added by
chapter 239 of the laws of 1986 and as further amended by section 104 of
part A of chapter 62 of the laws of 2011, is amended to read as follows:
  10. The superintendent of financial  services  shall  promulgate  such
regulations  and rules as [it] HE OR SHE considers appropriate to govern
the administration of common  trust  funds  and  short  term  investment
common trust funds.
  S 9. Paragraph (c) of subdivision 1 of section 103 of the banking law,
as  amended  by  chapter 1 of the laws of 1983 and as further amended by
section 104 of part A of chapter 62 of the laws of 2011, is  amended  to
read as follows:
  (c)  Loans  (exclusive  of any loan described in paragraph (a) of this
subdivision) to any state other than the state of New York,  or  to  any
foreign  nation,  the  New  York State thruway authority, the Triborough
bridge and tunnel authority, The Port of New York Authority, a  railroad
corporation,  a  municipal  corporation  of  this  state,  a corporation
subject to the jurisdiction of  a  public  service  commission  of  this
state,  or  any  international lending facility or public benefit corpo-
ration designated by the superintendent of financial services by general
or specific regulation [upon a three-fifths vote of  all  its  members,]

S. 4350                             4

may  equal  but  not exceed twenty-five per centum of the capital stock,
surplus fund and undivided profits of such bank or trust company.
  S  10.  Subdivision 4 of section 103 of the banking law, as amended by
chapter 313 of the laws of 2001, and as further amended by  section  104
of  part  A  of  chapter  62  of the laws of 2011, is amended to read as
follows:
  4. Make a loan upon the security of real estate within or without this
state which does not comply with any such rules or  regulations  as  the
superintendent of financial services may prescribe.
  No  loan shall be made under the provisions of this subdivision except
upon the written and signed certificate of an appraiser appointed pursu-
ant to policies established by the board of directors, certifying to the
value of the premises according to his judgment.
  The provisions of this subdivision shall not constitute the  authority
to make a loan to a natural person upon the security of a mortgage which
is not a first lien.
  Where the collateral for any loan consists partly of real estate secu-
rity  and partly of other security, including a guarantee or endorsement
by or an obligation or commitment of a person other than  the  borrower,
only  the  amount  by  which the loan exceeds the value as collateral of
such other security, as found in good faith by a duly authorized officer
of such bank or trust company, at the time of the making of the loan  or
commitment  therefor,  shall  be  considered a loan upon the security of
real estate, provided, that in no event shall a  loan  be  considered  a
loan  upon the security of real estate (i) where the principal amount of
any real estate security taken therefor is less than fifteen per  centum
of  the amount of such loan or (ii) where the loan is payable in monthly
or quarterly installments over a period not to exceed one hundred  twen-
ty-one months and does not exceed twenty thousand dollars and is for the
purpose  of  paying the cost of any repairs, alterations or improvements
upon, or in connection with, or, as the  superintendent  may  authorize,
the  equipping  of existing structures or the building of new structures
by the owners thereof or by the lessees under a lease expiring not  less
than  six  months after the maturity of the loan or (iii) where the loan
is fully guaranteed or insured by the United States or a state,  or  any
department,  agency  or  instrumentality thereof, and for the payment of
which loan the full faith and credit of the United  States  or  of  such
state  is  pledged  and  if under the terms of the guaranty or insurance
agreement the bank or trust company will  be  assured  of  repayment  in
accordance  with  the terms of the loan or (iv) where there is a binding
and valid commitment or agreement by a financially  responsible  lender,
purchaser  or  other  financially responsible party either directly with
the lending bank or trust company or which is for the benefit of, or has
been assigned to, the lending bank or  trust  company  and  pursuant  to
which  commitment,  agreement  or  assignment,  the lender, purchaser or
other party is required to advance to the lending bank or trust  company
within  thirty  months from the date of such commitment or agreement the
full amount of the loan to be made by the lending bank or trust  company
upon the security of real estate improved by a building or buildings, or
to   be   improved  by  a  building  or  buildings  in  the  process  of
construction, the major portion of which building is  used,  or  in  the
case  of  a  building under construction is to be used, for residential,
business, manufacturing or agricultural purposes, and where pursuant  to
the  terms  and  provisions of such commitment or agreement such advance
shall be made prior to or upon the maturity of the loan by  the  lending
bank or trust company.

S. 4350                             5

  Real  estate  security  for purposes of this section shall not include
(a) an assignment of rents under a lease, (b) a mortgage or  other  lien
upon  a  leasehold, (c) a mortgage or other lien upon leasehold, royalty
or other rights  in  oil,  gas,  minerals,  standing  timber,  or  other
products  of  land, (d) a mortgage or other lien made or given upon real
estate and taken  as  collateral  security  for  loans  to  a  borrower,
provided,  that  at  the  time  of  the making of the loan or commitment
therefor, repayment thereof is reasonably expected to be made out of the
operations of such borrower or of the mortgagor, or (e)  such  mortgages
or  other  liens  on  property  as may be specifically exempted from the
limitations and restrictions of this subdivision by  the  superintendent
of  financial  services by general or specific regulations [adopted by a
three-fifths vote of all its members]. Nothing in this  paragraph  shall
be construed to imply that security of a kind not mentioned herein is to
be deemed real estate security.
  The  limitations  and restrictions contained in this subdivision shall
not prevent the acceptance of any real estate  security  to  secure  the
payment  of  a  debt previously contracted in good faith. Every mortgage
and every assignment of a mortgage taken or held by such bank  or  trust
company  shall  immediately be recorded or registered in its name in the
office of the clerk or the proper recording officer  of  the  county  in
which  the real estate described in the mortgage is located, except that
where the underlying real estate is located outside  the  state  of  New
York  such  mortgage  or assignment may be recorded or registered in the
name of a duly authorized nominee, and except that if such  mortgage  or
assignment  of  mortgage or of an interest therein shall be taken from a
corporation organized under the banking law or all of the capital  stock
of  which  is owned by not less than twenty savings banks of this state,
the bank or trust company may hold such  mortgage  or  assignment  unre-
corded  unless the superintendent shall direct the bank or trust company
to record the same. The recording or registering of assignments of mort-
gages shall not be  required  when  not  less  than  ten  mortgages  are
assigned  as  security  for  a  loan,  the term of which does not exceed
twelve months.
  Any bank or trust company may renew from time to time  any  loan  upon
the security of real estate lawfully made by it prior to June thirtieth,
nineteen hundred thirty-seven.
  None  of  the prohibitions and restrictions contained in this subdivi-
sion shall apply to any corporation all of the capital stock of which is
owned by not less than twenty savings banks of this state.
  S 11. Paragraph (d) of subdivision 8 of section  108  of  the  banking
law,  as  added  by chapter 344 of the laws of 1974, such subdivision as
renumbered by chapter 512 of the laws of 1977, and as further amended by
section 104 of part A of chapter 62 of the laws of 2011, is  amended  to
read as follows:
  (d) The superintendent of financial services may promulgate such regu-
lations  as  [it]  HE OR SHE deems necessary and proper to implement and
define the provisions of this subdivision. The superintendent of  finan-
cial  services  may prescribe maximum charges from time to time, but not
more often than once in any six month period, and shall provide  reason-
able  notice to the public of any change in such maximum charges, of the
effective date of such change, which shall not be less than  seven  days
following the adoption of such change by the superintendent of financial
services,  and of any rule or regulation adopted pursuant to this subdi-
vision.

S. 4350                             6

  S 12.  Section 111 of the banking law, as amended by  chapter  360  of
the  laws  of  1984  and  as further amended by section 104 of part A of
chapter 62 of the laws of 2011, is amended to read as follows:
  S 111.  Profits;  credits to surplus fund and to undivided profits. In
any case where the combined capital stock, surplus  fund  and  undivided
profits  of  a  bank or trust company do not equal ten per centum of its
net deposit liabilities, the superintendent of financial services may in
[its] HIS OR HER discretion require such bank or trust  company  at  the
close  of  each  accounting  period  to  credit  its surplus fund with a
portion of its net profits for such period, not to exceed ten per centum
thereof, until its combined capital stock, surplus  fund  and  undivided
profits  equal  ten  per  centum of its net deposit liabilities. For the
purposes of this section, the term "net deposit liabilities" shall  mean
total deposits including all amounts due to national banks, banks, bank-
ers, trust companies and savings banks, the amounts due on certified and
cashier's  checks, and for unpaid dividends less the amounts of balances
due from national banks, banks, bankers, and trust  companies  and  cash
items  in process of collection payable immediately upon presentation in
the United States.
  S 13.  Paragraph (b) of subdivision 3 of section 130  of  the  banking
law,  as  amended  by  chapter  217  of  the laws of 2010 and as further
amended by section 104 of part A of chapter 62 of the laws of  2011,  is
amended to read as follows:
  (b)  The  superintendent of financial services shall have the power to
determine by regulation who shall be considered, under the provisions of
this subdivision, to be an  executive  officer,  and  by  a  general  or
specific  regulation[,  upon a three-fifths vote of all its members,] to
grant permission to an executive officer of a bank or trust  company  to
be  an executive officer, director or trustee or both an executive offi-
cer and director or a trustee of another bank or trust company,  savings
bank,  or  savings  and loan association, national bank, federal savings
bank or federal savings association, the principal office  of  which  is
located  in  this state, bank holding company, or foreign banking corpo-
ration maintaining a branch in this state. Such permission may be grant-
ed only if in the judgment of the superintendent of  financial  services
such service by the executive officer will be consistent with the policy
of the state of New York as declared in section ten of this chapter. The
superintendent of financial services shall have the power to revoke such
permission [by a like vote] whenever [it] HE OR SHE finds, after reason-
able  notice  and  an  opportunity to be heard, that the public interest
requires such revocation.
  S 14.  Subdivision 4 of section 234-b of the banking law, as added  by
chapter 883 of the laws of 1980 and as further amended by section 104 of
part A of chapter 62 of the laws of 2011, is amended to read as follows:
  4.  The  superintendent of financial services is authorized to promul-
gate such regulations as [it] HE OR SHE may deem necessary or proper  to
implement  the provisions of this section and the proper exercise of the
powers granted by this section.
  S 15.  Section 380-h of the banking law, as added by  chapter  883  of
the laws of 1980, subdivisions 1 and 4 as further amended by section 104
of  part  A  of  chapter  62  of the laws of 2011, is amended to read as
follows:
  S 380-h. Trust powers. 1. The superintendent of financial services  is
authorized and empowered to grant permission to a savings and loan asso-
ciation  to  exercise any or all of the powers specified in sections one
hundred, one hundred-a, one hundred-b and one hundred-c of this chapter.

S. 4350                             7

In passing upon applications for permission to exercise any such powers,
the superintendent of financial services may take into consideration the
amount of surplus of the  applying  association,  whether  or  not  such
surplus  is sufficient under the circumstances of the case, the needs of
the community to be served and any other facts  and  circumstances  that
seem [to it] proper, and may grant or refuse it permission accordingly.
  2. Whenever the laws of this state require a trust company acting in a
fiduciary  capacity to deposit securities with the state authorities for
the protection of private or court trusts, a savings  and  loan  associ-
ation, so acting, is empowered to make similar deposits of securities.
  4.  The  superintendent of financial services is authorized to promul-
gate such regulations as [it] HE OR SHE may deem necessary or proper  to
implement  the provisions of this section and the proper exercise of the
powers granted by this section.
  S 16.  Section 455 of the banking law, as added by chapter 608 of  the
laws  of 1996 and subdivisions 1 and 3 as further amended by section 104
of part A of chapter 62 of the laws of  2011,  is  amended  to  read  as
follows:
  S  455.  Trust  powers. 1. The superintendent of financial services is
authorized and empowered to grant permission to a credit union to  exer-
cise  any  or  all  of the powers specified in sections one hundred, one
hundred-a, one hundred-b and one hundred-c of this chapter.  In  passing
upon applications for permission to exercise any such powers, the super-
intendent  of  financial services may take into consideration the amount
of net worth of the applying credit union, whether or not such net worth
is sufficient under the circumstances of the  case,  the  needs  of  the
community  to  be served and any other facts and circumstances that seem
[to it] proper, and may grant or refuse it permission accordingly.
  2. Whenever the laws of this state require a trust company acting in a
fiduciary capacity to deposit securities with the state authorities  for
the protection of private or court trusts, a credit union, so acting, is
required and empowered to make similar deposits of securities.
  3.  The  superintendent of financial services is authorized to promul-
gate such regulations as [it] HE OR SHE may deem necessary or proper  to
implement  the provisions of this section and the proper exercise of the
powers granted by this section.
  S 17. Paragraph (a) of subdivision 1 of section  595  of  the  banking
law,  as  amended  by  chapter  571  of  the laws of 1986 and as further
amended by section 104 of part A of chapter 62 of the laws of  2011,  is
amended to read as follows:
  (a)  Through  a  course  of  conduct,  the  licensee or registrant has
violated any provisions of this  article,  or  any  rule  or  regulation
promulgated by the superintendent of financial services[, or any rule or
regulation  prescribed  by  the  superintendent]  under  and  within the
authority of this article or of any other law,  rule  or  regulation  of
this state or the federal government;
  S  18.  Subdivision 7 of section 600 of the banking law, as amended by
chapter 315 of the laws of 2008 and as further amended by section 104 of
part A of chapter 62 of the laws of 2011, is amended to read as follows:
  (7) One or more subsidiaries or affiliates of a bank,  trust  company,
savings  bank  or  savings  and  loan association, which are not a bank,
trust company, savings bank or savings and loan  association,  as  those
terms  are  defined in section two of this chapter, with the bank, trust
company, savings bank or savings and loan association of which it  is  a
subsidiary  or  affiliate,  as  the superintendent of financial services
shall approve and enter on its records; provided, however, that  nothing

S. 4350                             8

in  this subdivision shall be deemed to authorize a bank, trust company,
savings bank or savings and loan association to exercise  any  power  or
engage in any activity that it may not exercise or engage in pursuant to
this  chapter.  The  superintendent of financial services may promulgate
such regulations as [it] HE OR SHE deems necessary and proper to  imple-
ment  and  define  the  provisions  of this subdivision. Nothing in this
subdivision shall alter, affect or impair any regulation  or  resolution
adopted,  or  that  may  be  adopted, by the superintendent of financial
services, pursuant to section twelve-a or former sections fourteen-g  or
fourteen-h of this chapter.
  S 19.  This act shall take effect immediately.