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S5296Senate2015-2016 Session

Relates to bank organization examinations

Sponsor Diane J. SavinoSD-23Affects Finance
Status
In Assembly Committee
Banks
Impact
Pending
Passage
Pending

Bill progress

Step 5 of 7

In Assembly · Banks

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Sponsors

Primary sponsor
Diane J. Savino

Senator · Senate District 23

Chair, Banks

No co-sponsors yet.

History

  1. Referred to banks
  2. Delivered to assembly
  3. Passed senateVote 59–0
  4. Advanced to third reading
  5. 2nd report cal.
  6. 1st report cal.314
  7. Referred to banks
  8. Returned to senate
  9. Died in assembly
  10. Referred to banks
  11. Delivered to assembly
  12. Passed senateVote 62–0
Show 4 earlier actions
  1. Advanced to third reading
  2. 2nd report cal.
  3. 1st report cal.1329
  4. Referred to banks

Full text

The text isn't available here yet. Check nysenate.gov.

Sponsor's memo

BILL NUMBER:S5296

Title of bill

An act to amend the banking law, in relation to examinations

Purpose

Changes the interval and asset threshold for examinations of certain banks by the Department of Financial Services

Summary of provisions

Amends paragraph (b) of subdivision 2 of § 36 of the banking law extends the examination period to once in 18 months for banks with assets of less than $1 billion.

Existing law

Current law allows the superintendent of DFS to extend the examination interval from once each calendar year to at least once each eighteen month period for banks with assets over $250 million.

Justification

Community banks are facing challenges from increased regulatory and technology demands. The thousands of pages of new federal regulations from Dodd Frank apply to banks irrespective of size or their business model. Community banks have additional costs and staff to respond to compliance requirements. This increased regulatory burden reflected in the continuing loss of community banks in New York State. From 1992 to 2011, the number if community banks in New York State has shrunk from 299 to 169. This trend has not dissipated. There is pressure to consol- idate in part to achieve scale to meet compliance requirements in a cost-effective manner.

This bill seeks to provide community banks under $1 billion in assets (currently $250 million) with regulatory relief by extending the it examination cycle from annually to 18 months. As a predicate to extend the examination cycle, the bank must demonstrate it is well capitalized, the most recent exam determined the bank was well managed and its composite condition was outstanding or good, and there was no pending enforcement proceeding.

This proposal will not only benefit community banks but also permit the Department of Financial Services to deploy examiners more effectively. There are protections to ensure that a problem banks does not receive a six month extension of their review cycle.

Legislative history

2015 Session - New Legislation

Fiscal implications

None

Effective date

Immediately

Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.