HB417 Alabama 2018 Session

Updated Feb 26, 2026

Notable

Summary

Primary Sponsor: Chris BlackshearRepresentative
Republican
Session: Regular Session 2018
Title: Banks, state regulated, service providers, Superintendent of Banks authorized to examine, Examination of Bank Service Providers Act, Secs. 5-3A-30 to 5-3A-35, inclusive, added
Summary: HB 417 creates a framework that lets Alabama's Superintendent of Banks examine bank service providers that supply services to state-regulated banks to protect financial safety and stability.
What This Bill Does
Authorizes the Superintendent of Banks to appoint examiners to inspect service providers that provide covered services to serviced banks (non-national) to ensure safe and sound operation. Defines who a service provider and a serviced bank are, and lists covered services such as data processing, financial services support, and internet-related services. Allows using examinations done by other regulators within the prior 24 months, keeps examination reports confidential, and permits sharing reports with bank boards and the FFIEC. Enables agreements with other bank supervisory agencies for examiner services, corrective orders, and joint examinations or enforcement actions; the act becomes effective immediately after governor approval.

Who It Affects
Service providers that supply covered services (data processing, financial services support, internet-related services) to serviced banks will be subject to state examination and possible corrective actions.
Serviced banks (state-regulated banks, bank holding companies, and their subsidiaries/affiliates) that rely on these service providers may be examined indirectly through the service providers and will have access to examination reports by their board as permitted.

Key Provisions
Establishes the Examination of Bank Service Providers Act to authorize the state Superintendent of Banks to examine service providers that furnish services to serviced banks (non-national banks).
Defines 'service provider' and 'serviced bank' and lists covered services, including data processing, financial services support, and internet-related services.
Allows reliance on external regulator examinations within the previous 24 months and preserves the Superintendent’s ability to participate in other examinations.
Keeps examination reports confidential and permits sharing with banks' boards and FFIEC under specified terms.
Authorizes sole-source, procurement-exemption agreements with other bank supervisory agencies to obtain examiner services and to provide examiner services to others at reasonable rates; allows corrective orders and joint examinations or enforcement actions.

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