HB644 Alabama 2010 Session

Summary

Primary Sponsor

Mike Hill

Republican

Session

Regular Session 2010

Title

Banking Department, regulation of banks, removal of officers, prohibition of certain persons participating in affairs of a bank, review of applications for change of control, quorum of Banking Board, acquisition of out-of-state banks, Secs. 5-2A-12, 5-3A-6, 5-5A-44, 5-8A-20, 5-8A-24, 5-13B-3, 5-13B-4, 5-13B-5, 5-13B-6 am'd.

Summary

HB644 would expand Alabama's Banking Board and Department powers to remove bank officers, penalize misconduct, bar culprits from participating in banks, and tighten cross-state bank acquisition rules.

What This Bill Does

First, the Banking Board may direct the superintendent to remove a bank officer or impose civil money penalties. It would also let the Banking Department remove and prohibit a person who caused substantial losses from participating in the affairs of any Alabama state bank or its holding company, even if they are no longer employed. The bill changes the review process by removing certain Federal Reserve-related exemptions and giving the superintendent more time to review applications, and it changes the Banking Board's quorum to a majority of those present and entitled to vote. It also tightens rules for Alabama bank holding company acquisitions of out-of-state banks, including filing requirements, a five-year existence rule, a 30% deposits cap, public notice and comment, and clear decision timelines.

Who It Affects

• Bank officers, directors, and other individuals who caused a bank to suffer substantial financial loss: they could be removed and barred from participating in Alabama banks or holding companies, and could face civil penalties.
• Alabama state banks, their holding companies, and prospective buyers (including out-of-state acquirers): they face new oversight and requirements for acquisitions, including filing and information obligations, notice and comment processes, and deposit concentration limits.

Key Provisions

• Banking Board may order removal of a bank officer or impose civil penalties on the bank or affected person for unsafe or unsound conduct, with penalties up to $1,000 per day and up to $100,000 in aggregate.
• Banking Department may remove and prohibit a person who caused substantial bank losses from participating in the affairs of any Alabama state bank or its holding company, even after that person leaves employment.
• Eliminates the FDIC requirement to obtain an order confirming appointment as receiver when FDIC is appointed, and expands the superintendent's time to review applications for change of control.
• Quorum of the Banking Board is changed to be a majority of those present and entitled to vote.
• New rules for Alabama bank holding company acquisitions of out-of-state banks, including filing with the superintendent, detailed information requirements, public notice and comment, a 30% deposit-concentration cap (with possible waivers), and a 60-day decision window after a completed application.
• Information obtained under these provisions remains confidential; improper disclosure can be a Class A misdemeanor.

AI-generated summary using openai/gpt-5-nano on Feb 25, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Banks and Banking