Current through Register Vol. 48, No. 38, September 20, 2024
a) No savings bank
shall invest in or lend to a service corporation, as defined in Section
1007.105 of the Act, unless the service corporation has been approved by the
Director.
b) Subpart F of this Part
shall not apply to investments in single purpose corporations authorized under
Sections 1008(9) and 6009 of the Act.
c) Savings banks may designate a service
corporation or other subsidiary as an operating subsidiary as follows:
1) Upon approval of the Director, a
subsidiary of a savings bank that is majority owned and controlled by the
savings bank may be designated as an operating subsidiary provided that the
subsidiary engages solely in activities that are permitted for a depository
institution or an operating subsidiary of a depository association.
2) An operating subsidiary shall be subject
to the provisions of this Subpart except that a savings bank's total
investment, including equity and debt securities and loans, in its first-tier
operating subsidiary is not limited by this Subpart. Loans made by the savings
bank to its operating subsidiary shall not be subject to Section 6013 of the
Act.
3) Upon approval of the
Director, a subsidiary of a first-tier operating subsidiary may be designated
as an operating subsidiary; provided that the lower tier subsidiary is
wholly-owned and controlled by the first-tier operating subsidiary and engages
solely in activities that are permitted for a depository institution or an
operating subsidiary of a depository association. The total investment,
including equity and debt securities and loans, by the savings bank or its
first-tier operating subsidiary in the wholly-owned and controlled lower-tier
operating subsidiary is not limited by this Subpart or Section 6013 of the
Act.
4) The total investment,
including equity and debt securities and loans, by the savings bank and its
first-tier operating subsidiary in a service corporation or an operating
subsidiary that is not wholly-owned and controlled by the savings bank's
first-tier operating subsidiary is subject to the same limitations under this
Subpart that apply to the savings bank's investment in a service corporation
that is not an operating subsidiary.
5) As used in this subsection (c):
"Subsidiary" means a corporation, limited liability company,
partnership, business trust, joint venture, pool, syndicate or other similar
business organization.
"Majority-owned" means the savings bank owns more than 50% of
the voting interest or equivalent ownership interest of the subsidiary.
"Control" means effective operating control.
