HB544 Alabama 2011 Session

Updated Feb 27, 2026

Notable

Summary

Primary Sponsor: Mike Hill
Republican
Session: Regular Session 2011
Title: Banking Department, bank holding companies regulated, confidential reports, incorporation of a bank, notification requirements when change of voting shares through inheritance, Secs. 5-2A-12, 5-3A-1, 5-3A-3, 5-3A-4, 5-3A-6, 5-3A-11, 5-5A-1, 5-5A-22, 5-5A-44, 5-13B-11 am'd.
Summary: The bill strengthens Alabama's Banking Department oversight of bank holding companies, tightens loan and control rules, enhances confidentiality, and requires reporting on changes of voting control (including inheritance).
What This Bill Does
It defines bank holding companies and lets the superintendent order corrective actions with penalties and possible removal for unsafe conduct. It requires regular examinations of banks and their affiliates, expands who is considered an affiliate, and tightens confidentiality around examination information. It imposes new loan concentration limits on borrowers and requires board approval for excess loans. It creates a detailed process for changes of control of state banks, including filing requirements, timeframes, and exemptions, and allows cooperation with other regulators and collection of supervisory fees.

Who It Affects
Alabama state banks and bank holding companies, including their directors and officers, who face stricter supervision, examination, and enforcement provisions.
Individuals or entities seeking to acquire or gain control of a state bank (including inheritances and other transfers), who must file detailed applications, provide financial disclosures, and obtain supervisory approval.

Key Provisions
Definition of a bank holding company and the superintendent's authority to order corrective actions, impose civil penalties up to $1,000 per day (max $100,000) and removal for unsafe and unsound conduct.
Confidential handling of examination reports and related materials, with restricted disclosure to enforcement actions, certain federal agencies, or the bank's board; violations carry Class A misdemeanor penalties.
Regular examinations of banks at least every 18 months, with expanded ability to examine bank affiliates and holding companies; broad definition of 'affiliate'.
Outside director requirement for new banks (minimum five directors; chair must be an outside director) and potential waivers by the superintendent.
Loan concentration limits: no more than 10% of capital for unsecured loans to a single borrower, or 20% if secured, with detailed rules for calculating liabilities and various exclusions.
Changes of control of state banks: mandatory filing of a detailed application, disclosure of personal and financial information of acquiring parties, sources of funds, and proposed plans; confidentiality; potential denial for financial risk or lack of competence; decision within 60 days (extendable to 90 days with additional information).
Exemptions from filing for certain transfers (gifts, law/estate transfers); still require notice to the superintendent and a subsequent plan approval process for the first three years after control changes.
Authority to conduct joint examinations and enforcement with other regulators, and to assess supervisory and examination fees; recognition of home-state regulator authority for out-of-state banks.
Effective date: immediate upon passage.

AI-generated summary using openai/gpt-5-nano on Feb 24, 2026. May contain errors — refer to the official bill text for accuracy.
Subjects: Banking Department