OLR Bill Analysis

sHB 6498

AN ACT CONCERNING STATE SUPPORT OF COMMUNITY BANKS AND COMMUNITY CREDIT UNIONS

SUMMARY:

This bill requires the state treasurer to establish a program under which she may, based on cash availability, make available up to $ 100 million for investment in community banks and community credit unions. The bill defines a "community bank" as a bank domiciled in Connecticut with assets of up to $ 500 million, and a "community credit union" as a Connecticut credit union with assets between $ 10 million and $ 500 million and membership limited to people in a well-defined community, neighborhood, or rural district. The bill specifies that these investment funds come from the state's operating cash that the treasurer manages.

The bill requires the treasurer to establish (1) a schedule for making the investments and (2) a competitive bidding procedure under which banks and credit unions can compete for the funds. It authorizes her to establish capital standards for banks and credit unions that wish to participate in the program and to adopt implementing regulations. The bill also allows the treasurer to give preference to community banks and community credit unions when awarding contracts for services to be provided to her, including maintaining depository or disbursement accounts or lock box services.

EFFECTIVE DATE: October 1, 2003

COMMITTEE ACTION

Banks Committee

Joint Favorable Substitute