§ 1865. — Prior approval for investments in bank service companies.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 12USC1865]
TITLE 12--BANKS AND BANKING
CHAPTER 18--BANK SERVICE COMPANIES
Sec. 1865. Prior approval for investments in bank service
companies
(a) Approval of Federal banking agency
No insured bank shall invest in the capital stock of a bank service
company that performs any service under authority of subsection (c),
(d), or (e) of section 1864 of this title without prior notice, as
determined by the bank's appropriate Federal banking agency.
(b) Approval of Board
No insured bank shall invest in the capital stock of a bank service
company that performs any service under authority of section 1864(f) of
this title and no bank service company shall perform any activity under
section 1864(f) of this title without the prior approval of the Board.
(c) Considerations in determining approval
In determining whether to approve or deny any application for prior
approval or whether to approve or disapprove any notice under this
section, the Board or the appropriate Federal banking agency, as the
case may be, is authorized to consider the financial and managerial
resources and future prospects of the bank or banks and bank service
company involved, including the financial capability of the bank to make
a proposed investment under this chapter, and possible adverse effects
such as undue concentration of resources, unfair or decreased
competition, conflicts of interest, or unsafe or unsound banking
practices.
(d) Failure to act on application for approval
In the event the Board or the appropriate Federal banking agency, as
the case may be, fails to act on any application under this section
within ninety days of the submission of a complete application to the
agency, the application shall be deemed approved.
(Pub. L. 87-856, Sec. 5, Oct. 23, 1962, 76 Stat. 1133; Pub. L. 95-630,
title III, Sec. 308, Nov. 10, 1978, 92 Stat. 3677; Pub. L. 97-320, title
VII, Sec. 709, Oct. 15, 1982, 96 Stat. 1542; Pub. L. 103-325, title III,
Sec. 323, Sept. 23, 1994, 108 Stat. 2227; Pub. L. 104-208, div. A, title
II, Sec. 2613(f), Sept. 30, 1996, 110 Stat. 3009-478.)
Amendments
1996--Pub. L. 104-208 substituted ``companies'' for ``corporations''
in section catchline and ``company'' for ``corporation'' wherever
appearing in text.
1994--Subsec. (a). Pub. L. 103-325, Sec. 323(1), substituted ``prior
notice, as determined by'' for ``the prior approval of''.
Subsec. (c). Pub. L. 103-325, Sec. 323(2), inserted ``or whether to
approve or disapprove any notice'' after ``approval''.
1982--Pub. L. 97-320 substituted provisions relating to prior
approval for investments in bank service corporations for provisions
relating to regulation and examination of bank services for a regularly
examined bank or its subsidiary or affiliate whether performed on or off
its premises. See section 1867(c) of this title.
1978--Pub. L. 95-630 among other changes, substituted provisions
requiring banks regularly examined by a Federal supervisory agency,
which cause to be performed, by contract or otherwise, any bank service
for itself, to notify such supervisory agency of the existence of a
service relationship within 30 days after making such service contract
or performance of service, whichever occurs first for provisions
requiring that no bank subject to examination by a Federal supervisory
agency may cause to be performed, by contract or otherwise, any bank
service for itself unless satisfactory assurances are furnished to such
supervisory agency by both the bank and the party performing such
services that the performances thereof will be subject to regulation and
examination by such agency to the same extent as if such services were
being performed by the bank itself.
Effective Date of 1978 Amendment
Amendment by Pub. L. 95-630 effective on expiration of 120 days
after Nov. 10, 1978, see section 2101 of Pub. L. 95-630, set out as an
Effective Date note under section 375b of this title.
Section Referred to in Other Sections
This section is referred to in sections 1863, 1864 of this title.
