SB385 Alabama 2016 Session

Summary

Primary Sponsor

Mark Slade Blackwell

Republican

Session

Regular Session 2016

Title

Banks and Banking, ownership and acquisition of control, stock, approval of superintendent if certain voting securities acquired, Sec. 5-5A-44 am'd.

Summary

SB385 adds a state-level approval requirement by the Alabama State Banking Department for acquiring a substantial stake (25%, and 10% in some cases) of voting securities of a state bank, in addition to federal approvals.

What This Bill Does

It amends Section 5-5A-44 to require an application and prior approval by the State Banking Department when a person seeks to acquire 25% of a state bank’s voting securities, and in certain conditions 10%. The acquiring party must file on an approved form under oath, provide detailed information (including identities, finances, and the proposed terms), and pay a filing fee. The Department will review and can approve or deny the change of control within 60 days of a completed application, based on factors like financial stability, integrity, plans, funding, and effects on competition or community needs; there are confidentiality protections and a provision for appeals. The act also lists exemptions (such as certain foreclosures or transfers) but requires notice to the Department and a business plan within set timeframes for exempted changes, with ongoing oversight for the first years after a change of control. The measure applies to acquisitions occurring after the act’s effective date, which happens immediately upon the Governor’s approval.

Who It Affects

• Prospective acquirers of 25% (and 10% in specific circumstances) of voting securities of a state bank, who must file for and receive state approval before completing the acquisition.
• State banks in Alabama, their current stockholders and communities served, and the Alabama State Banking Department, which will oversee and regulate these change-of-control reviews and ensure safety, soundness, and competitive effects.

Key Provisions

• Adds 25% voting securities (and certain 10% cases) as triggers for requiring state-level filing and approval of a change of control by the State Banking Department.
• Requires a detailed, sworn filing with the department (including identity, finances, sources of funds, plans, and parties acting in concert) and a filing fee; acquiring parties must identify all concerted parties and obtain department approval before acquiring control.
• The department must approve or deny within 60 days after a complete application, based on criteria like financial condition, competence/integrity, potential plans for liquidation or major changes, funding arrangements, and impact on competition or community needs; confidentiality is provided for information.
• Exemptions exist for certain transfers (e.g., foreclosure or transfers by gift), but notice and additional plan requirements apply for exempted changes; the act is effective for acquisitions occurring after its effective date, which is immediate upon governor approval.

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

Subjects

Banks and Banking