Chapter 2. Application of California Financial Code >> Division 1.1. >> Chapter 2.
The request for authority to organize and establish a
corporation to engage in the banking or trust business shall be set
forth in an application in such form and containing such information
as the commissioner may require and shall be accompanied by a fee of
five thousand dollars ($5,000).
Upon receiving a request for an application, the commissioner
shall inform the prospective applicant in writing that the
commissioner is available to confer with such prospective applicant
in advance of the filing of an application for the purpose of
discussing questions relating to such application. However, no
application shall be decided in advance of filing.
Upon the filing of an application the commissioner shall make
or cause to be made a careful investigation and examination relative
to the following:
(a) The character, reputation, and financial standing of the
organizers or incorporators and their motives in seeking to organize
the proposed bank or trust company.
(b) The need for banking or trust facilities or additional banking
or trust facilities, as the case may be, giving particular
consideration to the adequacy of existing banking or trust facilities
and the need for further banking or trust facilities.
(c) The character, financial responsibility, banking or trust
experience, and business qualifications of the proposed officers of
the bank or trust company.
(d) The character, financial responsibility, business experience,
and standing of the proposed stockholders and directors.
(e) Other facts and circumstances bearing on the proposed bank or
trust company and its relation to the locality as in the opinion of
the commissioner may be relevant.
The commissioner may give or withhold his or her approval of
the application in his or her discretion, but he or she shall not
approve the application until he or she has ascertained to his or her
(a) That the public convenience and advantage will be promoted by
the establishment of the proposed bank or trust company.
(b) That the proposed bank or trust company will have a reasonable
promise of successful operation.
(c) That the bank is being formed for no other purpose than the
legitimate objects contemplated by this division.
(d) That the proposed capital structure is adequate.
(e) That the proposed officers and directors have sufficient
banking or trust experience, ability, and standing to afford
reasonable promise of successful operation.
(f) That the name of the proposed bank or trust company does not
resemble, so closely as to be likely to cause confusion, the name of
any other bank or trust company transacting business in this state or
which had previously transacted business in this state.
(g) That the applicant has complied with all of the applicable
provisions of this division.
(a) In this section, "control" has the meaning set forth in
(b) For purposes of Section 1023, the commissioner may find:
(1) That a proposed officer or director of a proposed bank or
trust company does not have sufficient standing to afford reasonable
promise of successful operation if such person has been convicted of,
or has pleaded nolo contendere to, any crime involving fraud or
(2) That the establishment of a proposed bank or trust company
will not promote the public convenience and advantage if any person
who is proposed to control the proposed bank or trust company or any
director or officer of such person has been convicted of, or has
pleaded nolo contendere to, any crime involving fraud or dishonesty.
(c) Subdivision (b) shall not be deemed to be the only grounds
upon which the commissioner may find, for purposes of Section 1023,
that a proposed officer or director of a proposed bank or trust
company does not have sufficient standing to afford reasonable
promise of successful operation or that the establishment of a
proposed bank or trust company will not promote the public
convenience and advantage.
At least 30 days before denying an application, the
commissioner shall by mail or other method of service give written
notice of the intended denial of an application and of the right of
the applicant to meet with the commissioner regarding the reasons for
such denial. The request for such meeting shall be in writing and
delivered to the commissioner within 20 calendar days of the date of
giving of the notice of intended denial. If a request is made for
such meeting, the application may not be denied until after the
The commissioner may, in approving an application to organize
and establish a corporation to engage in the banking or trust
business pursuant to Section 1023, impose any conditions the
commissioner deems reasonable or necessary or advisable in the public
(a) With the approval of the commissioner, a bank may be
formed to facilitate a merger or an acquisition of control. The new
bank may survive the merger or acquisition of control.
(b) Sections 1020, 1021, 1022, 1023, and 1024 shall not apply to
the formation of a bank pursuant to subdivision (a).
(c) Article 4 (commencing with Section 370) of Chapter 3 of
Division 1 shall apply to a bank formed pursuant to subdivision (a).
(d) A request for approval to form a bank in accordance with
subdivision (a) shall be accompanied by a fee of two thousand five
hundred dollars ($2,500).