§ 4871 Sale Of Business Unit

Key Takeaways

•A California bank can sell its entire business to another bank, but only if the buyer is a national bank, a foreign bank licensed in California, or a bank from another state that has insurance.
•If the buyer is a national bank or a foreign bank licensed in California, the sale must follow both California rules and federal rules.
•If the buyer is a bank from another state, the sale must follow California rules and the rules of the state where the buyer’s bank is located.
•This rule also applies to other types of money businesses in California, like loan companies, when they want to sell their whole business.

Example

A small California bank wants to sell its entire business to a big bank from New York.

The sale can happen, but the California bank must follow California’s rules and New York’s rules for banks. If the New York bank doesn’t follow the right rules, the sale might not be allowed.

(a) A California state bank may sell its whole business unit to a national banking association, a California federally licensed foreign (other nation) bank, or an insured foreign (other state) state bank pursuant to (1) this article, (2) in case the purchaser is a national banking association or a California federally licensed foreign (other nation) bank, federal law, and (3) in case the purchaser is a California federally licensed foreign (other nation) bank or an insured foreign (other state) state bank, the law of the foreign bank’s domicile. (b) A California industrial loan company may sell its whole business unit to an insured foreign (other state) industrial loan company pursuant to (1) this article and (2) the law of the foreign industrial loan company’s domicile. (c) A California state depository corporation of any class may sell its whole business unit to a federal depository corporation of another class, a California federally licensed foreign (other nation) bank, or an insured foreign (other state) state depository corporation of another class pursuant to (1) this article, (2) in case the purchaser is a federal depository corporation or a California federally licensed foreign (other nation) bank, federal law, and (3) in case the purchaser is a California federally licensed foreign (other nation) bank or an insured foreign (other state) state depository corporation, the law of the domicile of the foreign bank or foreign depository corporation. (Repealed and added by Stats. 1995, Ch. 480, Sec. 148. Effective October 2, 1995.)

Key Takeaways

•A California bank can sell its entire business to another bank, but only if the buyer is a national bank, a foreign bank licensed in California, or a bank from another state that has insurance.
•If the buyer is a national bank or a foreign bank licensed in California, the sale must follow both California rules and federal rules.
•If the buyer is a bank from another state, the sale must follow California rules and the rules of the state where the buyer’s bank is located.
•This rule also applies to other types of money businesses in California, like loan companies, when they want to sell their whole business.

Example

A small California bank wants to sell its entire business to a big bank from New York.

The sale can happen, but the California bank must follow California’s rules and New York’s rules for banks. If the New York bank doesn’t follow the right rules, the sale might not be allowed.

Key Takeaways

Example

Key Terms

References

§ 4871 Sale Of Business Unit

Key Takeaways

Example

Key Terms

References

Key Takeaways

Example

Key Terms

Related Statutes

References

Key Takeaways

Example

Key Terms

Related Statutes

References