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Subchapter 002: INTERSTATE BRANCHING AND ACTIVITIES
§ 15201. Establishment of branches outside Vermont
(a) A Vermont financial institution may establish a branch in any state other than this
State by merger, consolidation, acquisition, or as otherwise permitted by and in accordance
with the laws of such host state and applicable federal financial institution laws.
(b) A merger or consolidation pursuant to this section shall be in accordance with and
subject to the provisions of chapter 207 of this title.
(c) Not later than the date on which the required application is filed with the responsible
federal supervisory agency, the applicant in the establishment of a branch under this
section shall file an application on a form prescribed by the Commissioner. If the
Commissioner finds that the proposed transaction will not be detrimental to the safety
or soundness of the applicant and the applicant has obtained and provided the Commissioner
with copies of all other required approvals, the Commissioner shall approve the application
and the operation of the branch outside this State.
(d) A branch of a Vermont financial institution that is located in another state may conduct
any activity that is permissible for a branch in that state of a financial institution
incorporated under the laws of such state. In order to engage in trust activities
in an out-of-state branch, a Vermont financial institution shall have previously obtained
the Commissioner’s approval to engage in trust activities under section 14403 of this title. (Added 1999, No. 153 (Adj. Sess.), § 2, eff. Jan. 1, 2001.)
§ 15202. Establishment of branches in Vermont by financial institutions
(a) A state financial institution, foreign bank, or national bank may establish a branch
in this State pursuant to this section and in accordance with applicable state and
federal financial institution laws.
(b) The establishment of a branch in this State under this section shall be accomplished
by:
(1) a merger, or consolidation with, or the purchase of all or substantially all of the
assets of, a financial institution or acquisition of a branch located in this State;
or
(2) establishment of a branch; provided, however, that the law of the home state of any
state financial institution or national financial institution proposing to establish
one or more de novo branches in this State must expressly authorize, under conditions
no more restrictive than those imposed by the laws of this State as determined by
the Commissioner, the financial institution whose home state is this State to engage
in interstate branch establishment of de novo branches in that state. A financial
institution that is not a Vermont financial institution and is establishing a branch
in this State shall file a copy of the branch application, with any amendments to
the application, with the Commissioner at the time the application is filed with any
supervisory agency.
(c) A merger or consolidation pursuant to this section involving a Vermont financial institution
shall be in accordance with and subject to the provisions of chapter 207 of this title,
except that the application requirement shall be treated as a notice requirement and
the Commissioner may file an objection with the applicable supervisory agency with
jurisdiction over the transaction if the transaction fails to comply with law. Approval
of the Commissioner under chapter 207 of this title shall not be required.
(d) Any merger, consolidation, or acquisition pursuant to this section shall be subject
to the provisions of section 14108 of this title.
(e) A state financial institution that establishes a branch in this State shall comply
with the provisions of 11A V.S.A. chapter 15, 11 V.S.A. chapter 21, subchapter 10, except that 11A V.S.A. § 15.06 and 11 V.S.A. § 3136 shall not apply to any financial institution. Notwithstanding section 14103 of this title, a branch in this State of a state financial institution may engage in the activities
permitted of a financial institution organized under the laws of this State, and may
use the words “bank,” “banking association,” or “trust company” when engaged in such
activities. The organizational name of such financial institution shall not be deceptively
similar to any name in use by a person authorized to do business in this State.
(f) A branch of a state financial institution located in this State shall comply with
the laws of this State, including laws regarding community reinvestment, consumer
protection, fair lending, and the establishment of intrastate branches, to the same
extent as such laws apply to a branch in this State of a Vermont financial institution.
A branch in this State of a state financial institution may conduct any activity that
is permissible for a branch in this State of a Vermont financial institution, but
may not conduct any activity that is not permissible for a branch in this State of
a Vermont financial institution. If Vermont law requires a Vermont financial institution
or any branch of such financial institution to obtain the Commissioner’s approval
to engage in an activity, then a branch of a state financial institution shall obtain
the Commissioner’s approval in the same manner as a Vermont financial institution.
(g) A branch of a national financial institution located in this State shall comply with
the laws of this State, including laws regarding community reinvestment, consumer
protection, fair lending, and establishment of intrastate branches, to the same extent
as such laws apply to a national financial institution whose principal place of business
is in this State.
(h) A national or state financial institution that maintains a branch in this State pursuant
to this section may establish and operate one or more remote service units in this
State, without the approval of the Commissioner. Any remote service unit established
pursuant to this subsection shall be subject to the provisions of section 10302 of this title. Nothing in this section shall be deemed to authorize any other person or entity
to establish or operate any remote service unit in this State that accepts deposits
or that transfers funds between accounts. (Added 1999, No. 153 (Adj. Sess.), § 2, eff. Jan. 1, 2001; amended 2021, No. 105 (Adj. Sess.), § 300, eff. July 1, 2022.)
§ 15203. Foreign branches
(a) A foreign bank not licensed by federal authorities to establish a federal branch in
this State may transact business in this State only at a branch that is licensed by
the Commissioner. The Commissioner may, upon receipt of an application of the foreign
bank to establish a branch, issue a license to a foreign bank to conduct such business
in compliance with the laws of this State if the Commissioner finds that:
(1) the foreign bank and its management are of good character and sound financial standing;
(2) the management of the foreign bank and proposed management of the branch are adequate;
(3) the convenience and needs of the persons to be served by the proposed branch will
be promoted; and
(4) the foreign bank satisfies such other standards as the Commissioner may establish.
(b) The application required under this section shall be on a form approved by the Commissioner
and shall contain a copy of all applicable federal approvals. Except as otherwise
provided in this section, subsections 15202(b) and (d) of this title, the license,
application, and operations of a branch licensed under this section shall be subject
to the requirements imposed on the establishment and operation of branches of financial
institutions organized under the laws of this State. Except as otherwise provided
in federal law, this title or by rule or order of the Commissioner, the operations
of a foreign bank at a branch in this State shall be conducted with the same rights,
privileges, and powers as a financial institution incorporated under the laws of this
State at the same location and shall be subject to all the same duties, restrictions,
penalties, liabilities, conditions, and limitations that would apply under the laws
of the state to a financial institution incorporated under the laws of this State.
The Commissioner may impose conditions or restrictions on the operations of a branch
of a foreign bank in this State. (Added 1999, No. 153 (Adj. Sess.), § 2, eff. Jan. 1, 2001.)
§ 15204. Other activities
(a) Subject to subsection (b) of this section, a financial institution having its principal
office in a jurisdiction other than Vermont may maintain or conduct the following
offices or activities in this State:
(1) a temporary agency;
(2) an office used solely for internal operations of the institution to which the public
is not admitted for the conduct of financial institution business;
(3) an automated teller machine owned by other than a Vermont financial institution; provided,
however, that it does not accept deposits or transfer funds between accounts;
(4) loan production;
(5) foreign exchange services; or
(6) any other financial institution related office or activity that the Commissioner determines
may be maintained or conducted in this State.
(b) A financial institution shall obtain the Commissioner’s written approval prior to
maintaining any office or conducting any activity described in subsection (a) of this
section. The Commissioner may condition approval on the existing availability of the
activity in the State.
(c) Nothing in this section shall be deemed to permit a financial institution to solicit
or accept deposits, pay checks, or loan money within this State, unless it is otherwise
authorized to engage in such activity in this State.
(d) Notwithstanding section 14103 of this title, a financial institution authorized to engage in the activities permitted under this
section may use the words “bank,” “banking association,” “national association,” “financial
institution,” or “trust company” when engaged in the activities permitted under this
section. A financial institution that is authorized to engage in loan production in
this State, but not authorized to approve loans in this State, shall disclose in any
printed material and advertising that it is engaged in loan production. The organizational
name of such financial institution shall not be deceptively similar to any name in
use by an authorized financial institution doing business in this State. (Added 1999, No. 153 (Adj. Sess.), § 2, eff. Jan. 1, 2001; amended 2001, No. 73 (Adj. Sess.), § 5, eff. Feb. 2, 2002.)
§ 15205. Out-of-state activities by Vermont financial institutions
(a) Subject to subsection (b) of this section, a Vermont financial institution may maintain
or conduct the following offices or activities in another state:
(1) a temporary agency;
(2) an office used solely for internal operations of the institution to which the public
is not admitted for the conduct of financial institution business;
(3) an automated teller machine owned by a Vermont financial institution; provided, however,
that it does not accept deposits or transfer funds between accounts;
(4) loan production;
(5) foreign exchange services;
(6) trust activities; or
(7) any other financial institution-related activity that the host state determines may
be maintained or conducted in such state.
(b) The Vermont financial institution shall provide the Commissioner with written evidence
that the host state approved, did not object to, or otherwise allows the Vermont financial
institution to maintain the office or conduct in the host state the activity described
in subsection (a) of this section. In order to engage in trust activities in the host
state, a Vermont financial institution shall have previously obtained the Commissioner’s
approval to engage in trust activities under section 14403 of this title.
(c) Nothing in this section shall be deemed to permit a Vermont financial institution
to solicit or accept deposits, pay checks, or lend money within the host state, unless
it is otherwise authorized to engage in such activity in the host state. (Added 2005, No. 36, § 6, eff. June 1, 2005.)