CHAPTER 664 GENERAL STATEMENT AND DEFINITIONS

CHAPTER 664
GENERAL STATEMENT AND DEFINITIONS

Table of Contents

Sec. 36a-1. (Formerly Sec. 36-1). General statement.
Sec. 36a-2. (Formerly Sec. 36-2). Definitions.
Sec. 36a-3. Other defined terms.
Secs. 36a-4 to 36a-9.

Sec. 36a-1. (Formerly Sec. 36-1). General statement. This title shall be known as the "Banking Law of Connecticut" and shall be applicable to all Connecticut banks, Connecticut credit unions, first and secondary mortgage lenders and brokers, money order and travelers check licensees, check cashing service licensees, trustees under mortgages or deeds of trust of real property securing certain investments, corporations exercising fiduciary powers, small loan licensees, sales finance companies, mortgage servicing companies, debt adjusters, and to such other persons as subject themselves to the provisions of this title or who, by violating any of its provisions, become subject to the penalties provided in this title.

(1949 Rev., S. 5731; 1969, P.A. 167; P.A. 78-121, S. 8, 113; P.A. 88-65, S. 5; P.A. 94-122, S. 1, 340.)

History: 1969 act specified applicability to dealers of securities, investment counsel and investment counsel agents; P.A. 78-121 deleted private bankers and building associations from applicability provision; P.A. 88-65 deleted reference to industrial banks; P.A. 94-122 consolidated "state bank and trust companies", "savings banks", and "savings and loan associations" into the definition of "Connecticut banks", added references to specific licensees and removed references to licensees covered by sections moved to title 36b, effective January 1, 1995; Sec. 36-1 transferred to Sec. 36a-1 in 1995.

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Sec. 36a-2. (Formerly Sec. 36-2). Definitions. As used in this title, unless the context otherwise requires:

(1) "Affiliate" of a person means any person controlling, controlled by, or under common control with, that person;

(2) "Applicant" with respect to any license or approval provision pursuant to this title means a person who applies for that license or approval;

(3) "Automated teller machine" means a stationary or mobile unattended device, including a satellite device but excluding a point of sale terminal, at which banking transactions, including, but not limited to, deposits, withdrawals, advances, payments or transfers, may be conducted;

(4) "Bank" means a Connecticut bank or a federal bank;

(5) "Bank and trust company" means an institution chartered or organized under the laws of this state as a bank and trust company;

(6) "Bank holding company" has the meaning given to that term in 12 USC Section 1841(a), as from time to time amended, except that the term "bank", as used in 12 USC Section 1841(a) includes a bank or out-of-state bank that functions solely in a trust or fiduciary capacity;

(7) "Capital stock" when used in conjunction with any bank or out-of-state bank means a bank or out-of-state bank that is authorized to accumulate funds through the issuance of its capital stock;

(8) "Client" means a beneficiary of a trust for whom the Connecticut bank acts as trustee, a person for whom the Connecticut bank acts as agent, custodian or bailee, or other person to whom a Connecticut bank owes a duty or obligation under a trust or other account administered by such Connecticut bank, regardless of whether such Connecticut bank owes a fiduciary duty to the person;

(9) "Club deposit" means deposits to be received at regular intervals, the whole amount deposited to be withdrawn by the owner or repaid by the bank in not more than fifteen months from the date of the first deposit, and upon which no interest or dividends need to be paid;

(10) "Commissioner" means the Banking Commissioner and, with respect to any function of the commissioner, includes any person authorized or designated by the commissioner to carry out that function;

(11) "Company" means any corporation, joint stock company, trust, association, partnership, limited partnership, unincorporated organization, limited liability company or similar organization, but does not include (A) any corporation the majority of the shares of which are owned by the United States or by any state, or (B) any trust which by its terms shall terminate within twenty-five years or not later than twenty-one years and ten months after the death of beneficiaries living on the effective date of the trust;

(12) "Connecticut bank" means a bank and trust company, savings bank or savings and loan association chartered or organized under the laws of this state;

(13) "Connecticut credit union" means a cooperative, nonprofit financial institution that (A) is organized under chapter 667 and the membership of which is limited as provided in section 36a-438a, (B) operates for the benefit and general welfare of its members with the earnings, benefits or services offered being distributed to or retained for its members, and (C) is governed by a volunteer board of directors elected by and from its membership;

(14) "Connecticut credit union service organization" means a credit union service organization that is incorporated under the laws of this state, located in this state and established by at least one Connecticut credit union;

(15) "Consolidation" means a combination of two or more institutions into a new institution; all institutions party to the consolidation, other than the new institution, are "constituent" institutions; the new institution is the "resulting" institution;

(16) "Control" has the meaning given to that term in 12 USC Section 1841(a), as from time to time amended;

(17) "Credit union service organization" means an entity organized under state or federal law to provide credit union service organization services primarily to its members, to Connecticut credit unions, federal credit unions and out-of-state credit unions other than its members, and to members of any such other credit unions;

(18) "Customer" means any person using a service offered by a financial institution;

(19) "Demand account" means an account into which demand deposits may be made;

(20) "Demand deposit" means a deposit that is payable on demand, a deposit issued with an original maturity or required notice period of less than seven days or a deposit representing funds for which the bank does not reserve the right to require at least seven days' written notice of the intended withdrawal, but does not include any time deposit;

(21) "Deposit" means funds deposited with a depository;

(22) "Deposit account" means an account into which deposits may be made;

(23) "Depositor" includes a member of a mutual savings and loan association;

(24) "Director" means a member of the governing board of a financial institution;

(25) "Equity capital" means the excess of a Connecticut bank's total assets over its total liabilities, as defined in the instructions of the federal Financial Institutions Examination Council for consolidated reports of condition and income;

(26) "Executive officer" means every officer of a Connecticut bank who participates or has authority to participate, otherwise than in the capacity of a director, in major policy-making functions of such bank, regardless of whether such officer has an official title or whether that title contains a designation of assistant and regardless of whether such officer is serving without salary or other compensation. The president, vice president, secretary and treasurer of such bank are deemed to be executive officers, unless, by resolution of the governing board or by such bank's bylaws, any such officer is excluded from participation in major policy-making functions, otherwise than in the capacity of a director of such bank, and such officer does not actually participate in such policy-making functions;

(27) "Federal agency" has the meaning given to that term in 12 USC Section 3101, as from time to time amended;

(28) "Federal bank" means a national banking association, federal savings bank or federal savings and loan association having its principal office in this state;

(29) "Federal branch" has the meaning given to that term in 12 USC Section 3101, as from time to time amended;

(30) "Federal credit union" means any institution chartered or organized as a federal credit union pursuant to the laws of the United States having its principal office in this state;

(31) "Fiduciary" means a person undertaking to act alone or jointly with others primarily for the benefit of another or others in all matters connected with its undertaking and includes a person acting in the capacity of trustee, executor, administrator, guardian, assignee, receiver, conservator, agent, custodian under the Connecticut Uniform Gifts to Minors Act or the Uniform Transfers to Minors Act, and acting in any other similar capacity;

(32) "Financial institution" means any Connecticut bank, Connecticut credit union, or other person whose activities in this state are subject to the supervision of the commissioner, but does not include a person whose activities are subject to the supervision of the commissioner solely pursuant to chapter 672a, 672b or 672c or any combination thereof;

(33) "Foreign bank" has the meaning given to that term in 12 USC Section 3101, as from time to time amended;

(34) "Foreign country" means any country other than the United States and includes any colony, dependency or possession of any such country;

(35) "Governing board" means the group of persons vested with the management of the affairs of a financial institution irrespective of the name by which such group is designated;

(36) "Holding company" means a bank holding company or a savings and loan holding company, except, as used in sections 36a-180 to 36a-191, inclusive, "holding company" means a company that controls a bank;

(37) "Insured depository institution" has the meaning given to that term in 12 USC Section 1813, as from time to time amended;

(38) "Licensee" means any person who is licensed or required to be licensed pursuant to the applicable provisions of this title;

(39) "Loan" includes any line of credit or other extension of credit;

(40) "Merger" means the combination of one or more institutions with another which continues its corporate existence; all institutions party to the merger are "constituent" institutions; the merging institution which upon the merger continues its existence is the "resulting" institution;

(41) "Mutual" when used in conjunction with any institution that is a bank or out-of-state bank means any such institution without capital stock;

(42) "Mutual holding company" means a mutual holding company organized under sections 36a-192 to 36a-199, inclusive, and unless otherwise indicated, a subsidiary holding company controlled by a mutual holding company organized under sections 36a-192 to 36a-199, inclusive;

(43) "Out-of-state" includes any state other than Connecticut and any foreign country;

(44) "Out-of-state bank" means any institution that engages in the business of banking, but does not include a bank, Connecticut credit union, federal credit union or out-of-state credit union;

(45) "Out-of-state credit union" means any credit union other than a Connecticut credit union or a federal credit union;

(46) "Out-of-state trust company" means any company chartered to act as a fiduciary but does not include a company chartered under the laws of this state, a bank, an out-of-state bank, a Connecticut credit union, a federal credit union or an out-of-state credit union;

(47) "Person" means an individual, company, including a company described in subparagraphs (A) and (B) of subdivision (10) of this section, or any other legal entity, including a federal, state or municipal government or agency or any political subdivision thereof;

(48) "Point of sale terminal" means a device located in a commercial establishment at which sales transactions can be charged directly to the buyer's deposit, loan or credit account, but at which deposit transactions cannot be conducted;

(49) "Reorganized savings bank" means any savings bank incorporated and organized in accordance with sections 36a-192 and 36a-193;

(50) "Reorganized savings and loan association" means any savings and loan association incorporated and organized in accordance with sections 36a-192 and 36a-193;

(51) "Reorganized savings institution" means any reorganized savings bank or reorganized savings and loan association;

(52) "Representative office" has the meaning given to that term in 12 USC Section 3101, as from time to time amended;

(53) "Reserves for loan and lease losses" means the amounts reserved by a Connecticut bank against possible loan and lease losses as shown on the bank's consolidated reports of condition and income;

(54) "Retail deposits" means any deposits made by individuals who are not "accredited investors", as defined in 17 CFR Section 230.501(a);

(55) "Satellite device" means an automated teller machine which is not part of an office of the bank, Connecticut credit union or federal credit union which has established such machine;

(56) "Savings account" means a deposit account, other than an escrow account established pursuant to section 49-2a, into which savings deposits may be made and which account must be evidenced by periodic statements delivered at least semiannually or by a passbook;

(57) "Savings and loan association" means an institution chartered or organized under the laws of this state as a savings and loan association;

(58) "Savings bank" means an institution chartered or organized under the laws of this state as a savings bank;

(59) "Savings deposit" means any deposit other than a demand deposit or time deposit on which interest or a dividend is paid periodically;

(60) "Savings and loan holding company" has the meaning given to that term in 12 USC Section 1467a, as from time to time amended;

(61) "Share account holder" means a person who maintains a share account in a Connecticut credit union, federal credit union or out-of-state credit union that maintains in this state a branch, as defined in section 36a-435b;

(62) "State" means any state of the United States, the District of Columbia, any territory of the United States, Puerto Rico, Guam, American Samoa, the trust territory of the Pacific Islands, the Virgin Islands and the Northern Mariana Islands;

(63) "State agency" has the meaning given to that term in 12 USC Section 3101, as from time to time amended;

(64) "State branch" has the meaning given to that term in 12 USC Section 3101, as from time to time amended;

(65) "Subsidiary" has the meaning given to that term in 12 USC Section 1841(d), as from time to time amended;

(66) "Subsidiary holding company" means a stock holding company, controlled by a mutual holding company, that holds one hundred per cent of the stock of a reorganized savings institution;

(67) "Supervisory agency" means: (A) The commissioner; (B) the Federal Deposit Insurance Corporation; (C) the Resolution Trust Corporation; (D) the Office of Thrift Supervision; (E) the National Credit Union Administration; (F) the Board of Governors of the Federal Reserve System; (G) the United States Comptroller of the Currency; and (H) any successor to any of the foregoing agencies or individuals;

(68) "Time account" means an account into which time deposits may be made;

(69) "Time deposit" means a deposit that the depositor or share account holder does not have a right and is not permitted to make withdrawals from within six days after the date of deposit, unless the deposit is subject to an early withdrawal penalty of at least seven days' simple interest on amounts withdrawn within the first six days after deposit, subject to those exceptions permissible under 12 CFR Part 204, as from time to time amended;

(70) "Trust bank" means a Connecticut bank organized to function solely in a fiduciary capacity; and

(71) "Uninsured bank" means a Connecticut bank that does not accept retail deposits and for which insurance of deposits by the Federal Deposit Insurance Corporation or its successor agency is not required.

(1949 Rev., S. 5732; 1967, P.A. 461, S. 6; 1969, P.A. 199, S. 1; P.A. 77-614, S. 161, 610; P.A. 78-121, S. 9, 113; P.A. 80-482, S. 233, 345, 348; P.A. 83-406, S. 2, 11; P.A. 87-9, S. 2, 3; P.A. 88-65, S. 6; P.A. 92-12, S. 1; P.A. 94-122, S. 2, 340; Oct. Sp. Sess. P.A. 94-1, S. 14, 21; P.A. 95-155, S. 2, 29; P.A. 97-223, S. 1, 8; P.A. 98-258, S. 1; P.A. 00-2, S. 1, 3; P.A. 02-47, S. 1; 02-73, S. 1; P.A. 03-84, S. 23; 03-196, S. 1; P.A. 04-136, S. 1.)

History: 1967 act inserted new Subdiv. (f) defining "savings deposit", relettering former Subdivs. (f) to (h) accordingly and adding references to savings accounts and deposits as necessary; 1969 act included deposits of savings and loan associations in Subdiv. (c); P.A. 77-614 replaced bank commissioner with banking commissioner within the department of business regulation and made banking department a division within that department, effective January 1, 1979; P.A. 78-121 deleted reference to moneys received by building associations in Subdiv. (a) and reference to deposits of private bankers in Subdiv. (c); P.A. 80-482 restored banking division as independent department with banking commissioner as its head and abolished the department of business regulation; P.A. 83-406 added definitions of "capital stock bank", "national banking association", "capital stock savings bank", "capital stock savings and loan association", "mutual savings bank", "eligibility record date", "eligible account holder" and "savings account"; (Revisor's note: Pursuant to P.A. 87-9 "banking commissioner" was changed editorially by the Revisors to "commissioner of banking"); P.A. 88-65 redefined "account" and "deposit" by deleting references to industrial banks; P.A. 92-12 redesignated Subdivs; P.A. 94-122 consolidated, updated, alphabetized and added definitions, included "Connecticut bank" and "automated teller machine" and expanded the definition of "commissioner", effective January 1, 1995; Oct. Sp. Sess. P.A. 94-1 added definitions of "federal agency", "federal branch", "foreign bank", "representative office", "state agency" and "state branch" and renumbered prior definitions as necessary, effective January 1, 1995; Sec. 36-2 transferred to Sec. 36a-2 in 1995; P.A. 95-155 added the definition of "insured depository institution", redefined "state" to include any territory of the United States, Guam, American Samoa, the trust territory of the Pacific Islands, the Virgin Islands and the Northern Mariana Island, and in the definition of "savings and loan holding company" changed the citation from CFR to USC, effective June 27, 1995; P.A. 97-223 amended definitions of "mutual holding company", "reorganized savings bank" and "reorganized savings and loan association" in Subdivs. (39), (45) and (46), respectively, effective June 24, 1997; P.A. 98-258 added new Subdiv. (43) defining "out-of-state trust company" and redesignated existing Subdivs. (43) to (62) as Subdivs. (44) to (63); P.A. 00-2 made technical changes to definitions of "commissioner" in Subdiv. (9), "consolidation" in Subdiv. (13) and "merger" in Subdiv. (37), and redefined "holding company" in Subdiv. (33) by deleting references to bank holding company and savings and loan holding company and adding "a company that controls a bank", effective April 18, 2000; P.A. 02-47 redefined "mutual holding company", "reorganized savings bank" and "reorganized savings and loan association", added definition of "subsidiary holding company" and renumbered the subdivisions accordingly, effective May 9, 2002; P.A. 02-73 redefined "Connecticut credit union" and "time deposit", added definitions of "Connecticut credit union service organization" and "credit union service organization" and renumbered the subdivisions accordingly; P.A. 03-84 changed "Commissioner of Banking" to "Banking Commissioner" in Subdiv. (9), effective June 3, 2003; P.A. 03-196 defined "share account holder" in new Subdiv. (59) and redesignated existing Subdivs. (59) to (66), inclusive, as Subdivs. (60) to (67), inclusive, effective July 1, 2003; P.A. 04-136 added definitions of "client" in new Subdiv. (8), "retail deposits" in new Subdiv. (54), "trust bank" in new Subdiv. (70) and "uninsured bank" in new Subdiv. (71), renumbered existing Subdivs. accordingly and made technical changes, effective May 12, 2004.

See Sec. 1-1 for definitions of "banks", "savings banks" and "deposit account".

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Sec. 36a-3. Other defined terms. Other definitions applying to this title or to specified parts thereof and the sections in which they appear are:

(P.A. 94-122, S. 3, 340; P.A. 95-49, S. 1; 95-129, S. 1; 95-155, S. 3, 29; 95-253, S. 11, 19; P.A. 96-44, S. 8; P.A. 97-160, S. 2, 7; 97-209, S. 1, 6; P.A. 98-192, S. 1; P.A. 99-22, S. 1, 8; 99-63, S. 1; 99-158, S. 1; P.A. 00-14, S. 1, 3; P.A. 01-9, S. 1, 11, 01-34, S. 1; 01-56, S. 1; 01-76, S. 1, 5; P.A. 02-73, S. 2; 02-111, S. 1; P.A. 03-196, S. 2; 03-259, S. 1; P.A. 04-136, S. 2.)

History: P.A. 94-122 effective January 1, 1995; P.A. 95-49 added references to "network" and "processor" definitions and added a reference to Sec. 36a-155 in previously referenced "account", "consumer" and "financial institution" definitions; P.A. 95-129 added reference to "bankers' bank" definition; P.A. 95-155 added reference to "bank", "de novo branch", and "home state" definitions and added a reference to Sec. 36a-410 in "branch" definition, effective June 27, 1995; P.A. 95-253 added references to "general facility" and "limited facility" definitions, effective July 6, 1995; P.A. 96-44 added references to "controlling interest", "debt mutual fund", and "equity mutual fund" (Revisor's note: P.A. 96-44 omitted the reference to Sec. 36a-316 after "Financial institutions". Since the reference was not enclosed within brackets the omission has been treated as a clerical error and the reference to Sec. 36a-316 preserved); P.A. 97-160 added references to "branch or agency net payment entitlement", "branch or agency net payment obligation", "business and property in this state", "global net payment entitlement", "global net payment net payment obligation" and "qualified financial contract" definitions, effective June 24, 1997; P.A. 97-209 added references to "community bank" and "community development bank" definitions, effective June 24, 1997; P.A. 98-192 added reference to "electronic payment instrument" definition; P.A. 99-22 deleted reference to "groups having a common bond of occupation or association" definition and added references to "multiple common bond membership" and "single common bond membership" definitions, effective May 12, 1999; P.A. 99-63 added references to "advertise", "advertisement" and "simulated check" definitions; P.A. 99-158 added references to "closely related activities", "retail deposits" and "uninsured bank" definitions; P.A. 00-14 added reference to Sec. 36a-136 in "deposit account" definition, effective April 25, 2000; P.A. 01-9 added references to "assessment area", "community credit union" and "community reinvestment performance", effective July 1, 2001; P.A. 01-34 added references to "additional proceeds", "APR", "consummation", "high cost home loan", "prepaid finance charge" and "prepayment penalty" and added citation to Sec. 36a-746a in existing references to "broker" and "lender"; P.A. 01-56 deleted reference to "instrument" and added references to "material litigation", "money transmission" and "payment instrument"; P.A. 01-76 added citation to Sec. 36a-44a in existing reference to "financial institution", effective July 1, 2001; P.A. 02-73 added references to "annuities", "associated member", "basic services", "capital", "certificate of incorporation", "construction loan", "corporate", "credit manager", "credit union service organization", "credit union service organization services", "director", "equity security", "Federal Credit Union Act", "immediate family member", "insider", "insurance", "manufactured home", "member business loan", "member in good standing", "net outstanding member business loan balance", "officer", "real estate", "senior management", and "troubled Connecticut credit union" definitions, amended various existing definition references to add or change statutory citations and eliminated references to "certificate of organization" and "fiscal year" definitions; P.A. 02-111 deleted references to "mortgage broker" and "principal officer" definitions, deleted reference to Sec. 36a-510 in "broker" and "lender" definitions and added references to "debtor", "first mortgage broker", "first mortgage correspondent lender", "first mortgage lender", "nonrefundable", "originator", "secondary mortgage broker", "secondary mortgage correspondent lender", "secondary mortgage lender", "table funding agreement" and "warehouse agreement" definitions; P.A. 03-196 added references to "consolidate" and "mobile branch", amended reference to "deposit account" and deleted references to "eligible account holder", "transaction" and "troubled financial institution", effective July 1, 2003; P.A. 03-259 added references to "executive officer" and "related person" and amended reference to "Connecticut holding company"; P.A. 04-136 added references to "administrative expense" and "assets" and deleted references to "retail deposits" and "uninsured bank", effective May 12, 2004.

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Secs. 36a-4 to 36a-9. Reserved for future use.

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