BILL NUMBER: S8356

SPONSOR: PHILLIPS
 
TITLE OF BILL:  An act to amend the banking law, in relation to the
banking development district program

 
PURPOSE OR GENERAL IDEA OF BILL:

This bill would require the superintendent of financial services to
establish for eligible banking institutions with assets less than five
billion dollars, with an abbreviated application for participation in a
banking development district. It would further also require the super-
intendent to establish a unit within the department to assist banks with
both applications and participation in banking development districts.

 
SUMMARY OF SPECIFIC PROVISIONS:

This would add a new subdivision 7 to section 96-D of the banking law to
require the superintendent of financial services to:

1. Establish for all banks, trust companies or national banks, eligible
              

and seeking to participate in the banking development district program,
and which have total assets of less than five billion dollars, with an
abbreviated application for such participation;

2. Assure that such abbreviated application would not be more than three
pages, and that it be designed to be completed by such applicant in less
than one hour; and

3. Further establish, within the banking division of the department, a
unit to assist all banks, trust companies or national banks, eligible
and seeking to participate in the banking development district program,
with the successful completion and submission of their application, as
well as to assist all such banks, trust companies or national banks
operating in a banking development district, with their successful
participation in such program.

 
JUSTIFICATION:

The banking development district program is authorized under section
96-D of the banking law to encourage banks to operate branches in
geographic areas of the state that are found by the superintendent of
financial services to be underserved by banking services. This program
seeks to provide incentives to banks to offer their services in these
underserved communities.

The present application process for participation in a banking develop-
ment district, however, is often too time consuming, complex and expen-
sive for small banks to successfully navigate, thereby creating a disin-
centive for their participation in this important program.

This bill would require the superintendent to create a simplified,
abbreviated application for such small banks, as well as a unit within
the department to assist banks with their application and participation
in this valuable program. It is hoped that such will encourage broader
participation in this program, and thereby promote the advancement of
more banking services in presently underserved communities.

 
PRIOR LEGISLATIVE HISTORY:
This is a new bill.

 
FISCAL IMPLICATIONS:

None Noted.

 
EFFECTIVE DATE:
This act would take effect on the 90th day after it shall have become a
law.