Arkansas Administrative Code

23 CAR § 304-135. [Reserved]

23 CAR § 304-136. Conversion. The conversion of a state-chartered credit union to a federally-chartered credit union or a federally-charted credit union to a state-chartered credit union shall be governed by the applicable regulations of the National Credit Union Administration.…

23 CAR § 304-137. [Reserved]

23 CAR § 304-138. [Reserved]

23 CAR § 304-139. [Reserved]

23 CAR § 304-140. Administration. (a) Any interested person may petition the State Credit Union Supervisor for the issuance, amendment, or repeal of any rule by submitting such petition in writing together with a complete and concise statement of the petitioner's interest in the …

23 CAR § 304-141. [Reserved]

23 CAR § 304-142. [Reserved]

23 CAR § 304-143. [Reserved].

23 CAR § 320-1001. Combining loans to parent corporation and subsidiary — Loans to separate subsidiaries. (a) The Bank Commissioner and State Banking Board rule that separate loans to a parent corporation and its subsidiary must be combined, for the assets of the parent may be re…

23 CAR § 320-1002. Total indebtedness. (a) “Total indebtedness” shall also include any credit exposure to a person arising from a derivative transaction, repurchase agreement, reverse repurchase agreement, securities lending transaction, or securities borrowing transaction betwee…

23 CAR § 320-1003. Drafts or bills of exchange. (a) The Bank Commissioner and the State Banking Board rule that this exception applies to negotiable drafts and to bills of exchange drawn by the seller of commodities upon the purchaser and bearing the acceptance of the latter, or …

23 CAR § 320-1004. Obligations drawn against existing values. (a) The Bank Commissioner and the State Banking Board rule that this exception applies to obligations secured by pledge of bill of lading covering goods or commodities in process of shipment. (b) It is immaterial wheth…

23 CAR § 320-1005. Obligations secured by certain transferable documents of title. (a) The Bank Commissioner and the State Banking Board rule that one hundred fifteen percent (115%) collateral margin applies both to livestock and readily marketable and nonperishable commodities, …

23 CAR § 320-1006. Obligations guaranteed by Farm Service Agency. Obligations, which the Farm Service Agency or United States Department of Agriculture (formerly Farmers Home Administration), guarantees against any loss sustained by the bank are, to the extent of such guarantee, …

23 CAR § 320-1007. Loans secured by certificate of deposit. The portion of a loan properly secured by a commercial bank certificate of deposit, whether it is an “own” bank certificate of deposit or a certificate of deposit issued by another commercial bank will not be subject to …

23 CAR § 320-1008. Loan commitments and standby letters of credit. Loan commitments and standby letters of credit will be subject to a bank's legal loan limit in the entire amount on the date the loan commitment or letter of credit is issued in written form whether or not any, a …

23 CAR § 320-1201. Activities not requiring trust powers. (a) A bank acting as escrow holder under an ordinary escrow contract, where the bank has no power to invest the escrowed funds, does not require trust powers. (b) A state bank without trust powers may act as paying agent u…

23 CAR § 320-1202. Federal Deposit Insurance Corporation and Federal Reserve approval. (a) A nonmember insured bank may not adopt trust powers without Federal Deposit Insurance Corporation approval. (b) A state member bank must obtain Federal Reserve approval.

23 CAR § 320-1203. Title to trust securities in name of a nominee. (a) A bank or trust company in the administration of a trust may place title to trust securities in the name of a nominee. (b) If there is a cotrustee, consent must be obtained. (c) But a bank or trust company in …

23 CAR § 320-1204. Common trust fund. (a)(1) This concept permits the consolidation of the assets of the various trusts being administered by the bank into a common fund for investment purposes and to allocate to each trust a specific interest in this fund based on the amount of …

23 CAR § 320-1205. Individual retirement account. (a) 26 U.S.C. § 408 et seq., establishes individual retirement accounts. (b) A bank that has trust powers may accept deposits into individual retirement accounts and may, depending on the arrangement between the depositor and the …

23 CAR § 320-1206. Keogh plan. A bank's activities as trustee or custodian under a Keogh Plan is governed by 26 U.S.C. § 404(e).

23 CAR § 320-1207. Trust deposits awaiting investment or distribution. All trust deposits awaiting investment or distribution that are determined to be eligible under Arkansas Code § 28-69-206 for pledging of government securities to the deposit may be secured by a blanket pledgi…

23 CAR § 320-1208. Bank as trustee — Voting of own shares. (a) The trust department of a state bank is theoretically subject to the dominion of the board of directors, and the trust department conceivably might in some situations be called upon to vote the bank's own shares for p…

23 CAR § 320-1209. Trust policies. All state banks exercising trust powers shall adopt a trust policy setting forth, at a minimum: (1) Trust department investment practices, including investments in the obligations of the bank and its affiliates; (2) Voting practices and procedur…

23 CAR § 320-1301. Definitions. For the purposes of this part: (1) "Account" means the trust, estate, or other fiduciary relationship that has been established with a bank; (2) "Custodian under a Uniform Gifts to Minors Act" means an account established pursuant to a state law th…

23 CAR § 320-1302. Adoption of policies and procedures with respect to brokerage placement practices. (a) Each state bank exercising investment discretion (as defined in 12 C.F.R. § 12.2(h)) with respect to an account shall adopt and follow written policies and procedures intende…

23 CAR § 320-1303. Administration of fiduciary powers. (a)(1)(A) The board of directors is responsible for the proper exercise of fiduciary powers by the bank. (B) All matters pertinent thereto, including the determination of policies, the investment and disposition of property h…

23 CAR § 320-1304. Books and accounts. (a)(1) Every state bank exercising fiduciary powers shall keep its fiduciary records separate and distinct from other records of the bank. (2) All fiduciary records shall be so kept and retained for such time as to enable the bank to furnish…

23 CAR § 320-1305. Audit of trust department. (a) A committee of directors, exclusive of any active officers of the bank, shall at least once during each calendar year make suitable audits of the trust department or cause suitable audits to be made by auditors responsible only to…

23 CAR § 320-1306. Investment of funds held as fiduciary. (a)(1) Funds held by a state bank in a fiduciary capacity shall be invested in accordance with the instrument establishing the fiduciary relationship and local law. (2) When such instrument does not specify the character o…

23 CAR § 320-1307. Self-dealing. (a) Unless lawfully authorized by the instrument creating the relationship or by court order or by local law, funds held by a state bank as fiduciary shall not be invested in stock or obligations of, or property acquired from, the bank or its dire…

23 CAR § 320-1308. Custody of investments. (a)(1) The investments of each account shall be kept separate from the assets of the bank and shall be placed in the joint custody or control of not less than two (2) of the officers or employees of the bank designated for that purpose b…

23 CAR § 320-1309. Deposit of securities with state authorities. (a) Whenever the local law requires corporations acting as fiduciary to deposit securities with the state authorities for the protection of private or court trusts, every state bank in that state authorized to exerc…

23 CAR § 320-1310. Compensation of bank. (a)(1) If the amount of the compensation for acting in a fiduciary capacity is not regulated by local law or provided for in the instrument creating the fiduciary relationship or otherwise agreed to by the parties, a state bank acting in s…

23 CAR § 320-1311. Receivership or voluntary liquidation of bank. (a) Whenever a receiver is appointed for a state bank by the Bank Commissioner, such receiver shall, pursuant to the instructions of the commissioner and to the orders of the court having jurisdiction, proceed to: …

23 CAR § 320-1312. Surrender or revocation of fiduciary powers. (a) Any state bank that has been granted the right to exercise fiduciary powers and that desires to surrender such right shall file with the Bank Commissioner a certified copy of the resolution of its board of direct…

23 CAR § 320-1401. Collective investment. Any common trust fund or collective investment authorized by Arkansas Code § 28-69-202 shall be established and maintained in accordance with 12 C.F.R. § 9.18 as of January 1, 2019.

23 CAR § 320-1501. Legal holiday — Applicable law. (a) The legal holidays applicable to state banks shall be those holidays set forth in Arkansas Code § 1-5-101 and such other holidays as shall be established from time to time by the Board of Governors of the Federal Reserve Syst…

23 CAR § 320-1502. Charter amendment application for change of bank corporate name. (a) Prior to filing an application with the State Bank Department for a charter amendment to change the corporate name of a state bank, the bank must complete the following procedures: (1)(A) Publ…

23 CAR § 320-1503. Reservation of bank corporate name. (a)(1) The State Bank Department will accept a reservation for a bank corporate name only prior to and for the purpose of formation of a new state bank or prior to the consummation of an interstate merger transaction. (2) The…

23 CAR § 320-1504. Appeal of Bank Commissioner decision on minimum capital requirements to State Banking Board. (a) A state bank may appeal an order of the Bank Commissioner to increase its capital stock to the State Banking Board. (b) Notice of the bank’s request for appeal must…

23 CAR § 320-1505. Capital notes. (a)(1) A state bank, with the prior approval of the Bank Commissioner, may issue subordinated capital notes. (2) These notes may be authorized by the bank's directors, no stockholder's action being required. (3) The notes must be sold at not less…

23 CAR § 320-1506. Federal regulations. (a) Pursuant to both the Federal Reserve and Federal Deposit Insurance Corporation regulations, the capital notes must have an original average weighted maturity of five (5) years or more. (b) The five-year term begins not from the date wri…

23 CAR § 320-1601. Transfers affecting change in control. (a)(1) The acquisition of a state bank by a bank holding company, or the acquisition of twenty-five percent (25%) or more of the common stock of a state bank or a bank holding company controlling a state bank subsidiary, w…

23 CAR § 320-1701. Dividends — Prior approval. Prior approval of the Bank Commissioner shall be obtained prior to declaration and payment of any dividend by any state bank that shall amount to seventy-five percent (75%) or more of the net profits of the bank after all taxes for t…

23 CAR § 320-1801. Payment for stock. Under Arkansas Constitution, Article 12, § 8, corporate stock can be issued only for "money or property actually received, or labor done". A bank may not issue stock against the purchaser's promissory note, and it cannot issue stock at a pric…

23 CAR § 320-1802. Discriminatory sales of stock. (a) The issuance of new shares at an inadequate price operates to dilute the value of outstanding shares. (b) Therefore, even when the shareholders agree that shares may be sold free of preemptive rights the directors are under a …

23 CAR § 320-1803. Fractional shares — Scrip. (a) Unless prohibited by the articles of agreement, or any amendment thereto, or bylaws, a bank may issue a certificate for a fractional share. (b) The creation of fractional shares sometimes occurs in connection with stock dividends.…