§ 1340 Bank General Partnership Restrictions

Financial Code·California

AI SummaryVerified

This law says banks can't be general partners in a business unless they get special permission.

Key Takeaways

•Banks usually can't be the main partner in a business.
•They need special permission to do this.
•This rule is to keep banks from taking on too much risk.

Example

A bank wants to team up with a group of friends to start a restaurant.

The bank can't be the main partner in charge unless they get special permission from the law or the commissioner.

AI-generated — May contain errors. Not legal advice. Always verify source.

Official Source

View on CA.gov

§ 1340 Bank General Partnership Restrictions

Unless specifically authorized by law or by the commissioner, a bank shall not become, act as, or in any other manner assume the duties or liabilities of, a general partner. For purposes of this section, “general partner” has the meaning set forth in subdivision (m) of Section 15901.02 of the Corporations Code. (Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)

Last verified: January 11, 2026

Key Terms

general partner commissioner

References

Official text at leginfo.legislature.ca.gov
California Legislature. Financial Code. Section 1340.

Key Takeaways

Example

Key Terms

Related Statutes

References

Key Takeaways

Example

Key Terms

Related Statutes

References