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Chapter 1. Definitions of California Financial Code >> Division 1. >> Chapter 1.
This division, Division 1.1 (commencing with Section 1000),
Division 1.2 (commencing with Section 2000), Division 1.6 (commencing
with Section 4800), Division 2 (commencing with Section 5000),
Division 5 (commencing with Section 14000), Division 7 (commencing
with Section 18000), and Division 15 (commencing with Section 31000)
shall be known, and may be cited, as the "Financial Institutions Law."
If and to the extent that any provision of the Financial
Institutions Law is preempted by federal law, the provision does not
apply and shall not be enforced.
The word "bank" as used in the Financial Institutions Law
means any incorporated banking institution that shall have been
incorporated to engage in commercial banking business, industrial
banking, or trust business.
Banks are divided into the following classes:
(a) Commercial banks.
(b) Industrial banks.
(c) Trust companies.
(a) Commercial banks.
(b) Industrial banks.
(c) Trust companies.
"Commercial bank" means a corporation organized for the
purpose of engaging in the commercial banking business.
"Commercial banking business" includes, but is not limited to,
the business of soliciting, receiving, or accepting of money or its
equivalent on deposit as a regular business whether the deposit is
made subject to check or is evidenced by a certificate of deposit, a
passbook, a note, a receipt, or other writing, provided that nothing
herein shall apply to or include money or its equivalent left in
escrow, or left with an agent pending investment in real estate or
securities for, or on account of, his or her principal. In addition,
"commercial banking business" means to lend money on the security of
real or personal property or without security; to discount or deal in
bills, notes, or other commercial paper; to buy and sell for the
account of customers, and, if eligible for investment, for its own
account, securities, gold and silver bullion, foreign coins, and
bills of exchange; and generally to transact a commercial banking
business.
"Industrial bank" means a corporation organized for the
purpose of engaging in the industrial banking business.
"Industrial banking business" includes the making of loans and
acceptance of deposits, including deposits evidenced by investment
or thrift certificates, but excluding demand deposits.
"Trust business" means the business of acting as executor,
administrator, guardian or conservator of estates, assignee,
receiver, depositary or trustee under the appointment of any court,
or by authority of any law of this or any other state or of the
United States, or as trustee for any purpose permitted by law.
"Trust company" means a corporation, industrial bank, or a
commercial bank that is authorized to engage in the trust business.
"Bank" or "banks" includes commercial banks, industrial banks,
and trust companies unless the context otherwise requires. However,
"bank" does not include a savings association or a credit union.
(a) "Office" includes head office, branch office, and any
other authorized place of business of a licensee.
(b) "Head office" means the principal place of business of a licensee.
(b) "Head office" means the principal place of business of a licensee.
"Real property" and "personal property" have the meanings
defined in and shall be construed in accordance with Title 1
(commencing with Section 654) of Part 1 of Division 2 of the Civil
Code.
"Commissioner" means the Commissioner of Business Oversight
and "department" means the Department of Business Oversight.
"Person" means an individual, sole proprietorship,
partnership, joint venture, association, trust, estate, business
trust, corporation, joint stock company, limited liability company,
unincorporated association, sovereign government or agency,
instrumentality, or political subdivision thereof, or any similar
entity or organization.
Unless the provision or the context otherwise requires, the
definitions set forth in this chapter govern the construction of the
Financial Institutions Law.
References in this division to the voting of shares shall be
construed in accordance with Section 111 of the Corporations Code.
If the articles of a bank provide for more or less than one
vote for any share on any matter, the references in Sections 139 and
141 to a majority or other proportion of shares means, as to such
matter, a majority or other proportion of the votes entitled to be
cast. Whenever, under Division 1 (commencing with Section 100), Title
1 of the Corporations Code, this division, or Division 1.1
(commencing with Section 1000), shares are disqualified from voting
on any matter, they shall not be considered outstanding for the
determination of a quorum at any meeting to act upon, or the required
vote to approve action upon, such matter under any provision of
Division 1 (commencing with Section 100), Title 1 of the Corporations
Code, of this division, Division 1.1 (commencing with Section 1000),
or of the articles or bylaws.
Any requirement in this division for a vote of each class of
outstanding shares shall be construed in accordance with Section 117
of the Corporations Code.
"Approved by (or approval of) the board" means approved or
ratified by the vote of the board or by the vote of a committee
authorized to exercise the powers of the board, except as to any
matter not within the competence of the committee under Section 311
of the Corporations Code or any matter for which this division also
requires approval of the shareholders or approval of the outstanding
shares.
"Approved by (or approval of) the outstanding shares" has the
meaning set forth in Section 152 of the Corporations Code and shall
include approval by the affirmative vote of a majority of the
outstanding shares of each class or series entitled, by any provision
of the articles, of this division, or of Division 1 (commencing with
Section 100), Title 1 of the Corporations Code, to vote as a class
or series on the subject matter being voted upon, and shall also
include approval by the affirmative vote of such greater proportion
(including all) of the outstanding shares of any class or series if
such greater proportion is required by the articles, by this
division, or by Division 1 (commencing with Section 100), Title 1 of
the Corporations Code.
"Approved by (or approval of) the shareholders" has the
meaning set forth in Section 153 of the Corporations Code and shall
include approval or ratification by the affirmative vote or written
consent of such proportion (including all) greater than a majority of
the shares of any class or series as may be provided in the
articles, in this division, or in Division 1 (commencing with Section
100), Title 1 of the Corporations Code for all or any specified
shareholder action.
"Articles" has the meaning set forth in Section 154 of the
Corporations Code.
"Board" has the meaning set forth in Section 155 of the
Corporations Code.
"California" means:
(a) When used with respect to a bank, in the case of a state bank, a bank that is organized under the laws of this state and, in the case of a national bank, a national bank that maintains its main office in this state.
(b) When used with respect to an office of a bank, an office which is located in this state.
(c) When used with respect to any corporation other than a bank, a corporation that is organized under the laws of this state.
(a) When used with respect to a bank, in the case of a state bank, a bank that is organized under the laws of this state and, in the case of a national bank, a national bank that maintains its main office in this state.
(b) When used with respect to an office of a bank, an office which is located in this state.
(c) When used with respect to any corporation other than a bank, a corporation that is organized under the laws of this state.
"CAMELS composite rating" shall have the meaning set forth in
Section 327.8(j) of Title 12 of the Code of Federal Regulations.
"Certificate of correction" means a certificate executed and
filed with the Secretary of State pursuant to Section 109 of the
Corporations Code, subject, however, to the provisions of Section
1105.
"Certificate of determination" has the meaning set forth in
Section 156 of the Corporations Code, subject, however, to the
provisions of Section 1104.
"Certificate of revocation" means a certificate executed and
filed with the Secretary of State pursuant to the second and third
sentences of subdivision (c) of Section 110 of the Corporations Code,
subject, however, to the provisions of Section 1106.
"Common shares" has the meaning set forth in Section 159 of
the Corporations Code.
(a) "Confidential information" means any information regarding
a licensee contained in, or related to, any of the following:
(1) Applications filed with the commissioner.
(2) Examination, operating, condition, or any other reports prepared by, on behalf of, or for the use of, the commissioner.
(3) Information received in confidence by the commissioner.
(b) Confidential information is the property of the commissioner.
(1) Applications filed with the commissioner.
(2) Examination, operating, condition, or any other reports prepared by, on behalf of, or for the use of, the commissioner.
(3) Information received in confidence by the commissioner.
(b) Confidential information is the property of the commissioner.
"Constituent corporation," when used with respect to a
corporation:
(a) In the case of a merger, has the meaning set forth in Section 161 of the Corporations Code.
(b) In the case of a consolidation, means a corporation that is consolidated with one or more other corporations.
(a) In the case of a merger, has the meaning set forth in Section 161 of the Corporations Code.
(b) In the case of a consolidation, means a corporation that is consolidated with one or more other corporations.
"Contributed capital" means all of shareholders' equity other
than retained earnings. However, nothing in this section shall
prohibit a bank from transferring amounts from time to time from its
retained earnings to its contributed capital, subject to any
applicable statutes, regulations, and generally accepted accounting
principles.
"Credit union" means a corporation of the type described in
Section 14002 organized under the laws of this state or a corporation
of similar type organized under the laws of the United States or of
any state of the United States other than this state.
"Directors" has the meaning set forth in Section 164 of the
Corporations Code.
"Disappearing," when used with respect to a corporation, means
a constituent corporation that is not the surviving corporation.
"Distribution to its shareholders" has the meaning set forth
in Section 166 of the Corporations Code. However, in Division 1
(commencing with Section 100), Title 1 of the Corporations Code, in
this division, and in Division 1.1 (commencing with Section 1000),
"distribution to its shareholders" does not include any purchase of
shares by a bank or by a majority-owned subsidiary of a bank which is
necessary to reduce or avoid loss to such bank or to such subsidiary
on an extension of credit previously made in good faith. Also, in
this division and in Division 1.1 (commencing with Section 1000),
"distribution to its shareholders" includes any distribution made by
a bank or by a majority-owned subsidiary of a bank to the
shareholders of any corporation of which such bank is a
majority-owned subsidiary.
(a) "Foreign," when used with respect to a bank, an office of
a bank, or any corporation other than a bank, means foreign (other
nation) or foreign (other state).
(b) "Foreign banking corporation" means a foreign bank.
(b) "Foreign banking corporation" means a foreign bank.
"Foreign nation" means any nation other than the United
States, including, without limitation, any subdivision, territory,
trust territory, dependency, colony, or possession of any nation
other than the United States. "Foreign nation" includes Puerto Rico,
Guam, American Samoa, the Virgin Islands, and any territory, trust
territory, dependency, or insular possession of the United States.
(a) The definition of "state of the United States" in Section
207 does not apply to this section. In this section, "state of the
United States" means any state of the United States or the District
of Columbia.
(b) "Foreign (other nation)":
(1) When used with respect to a bank, means any bank (including, without limitation, any commercial bank, merchant bank, or other institution that engages in banking activities that are usual in connection with the business of banking in the nation in which the institution is organized or operating) other than (A) a bank that is organized under the laws of a state of the United States or (B) a national bank that maintains its main office in a state of the United States.
(2) When used with respect to an office of a bank, means an office that is located in a place other than a state of the United States.
(3) When used with respect to any corporation other than a bank, means a corporation that is organized under the laws of a foreign nation.
(b) "Foreign (other nation)":
(1) When used with respect to a bank, means any bank (including, without limitation, any commercial bank, merchant bank, or other institution that engages in banking activities that are usual in connection with the business of banking in the nation in which the institution is organized or operating) other than (A) a bank that is organized under the laws of a state of the United States or (B) a national bank that maintains its main office in a state of the United States.
(2) When used with respect to an office of a bank, means an office that is located in a place other than a state of the United States.
(3) When used with respect to any corporation other than a bank, means a corporation that is organized under the laws of a foreign nation.
"Foreign (other state)":
(a) When used with respect to a bank, means a bank that is organized under the laws of any state of the United States other than this state, or a national bank that maintains its main office in any state of the United States other than this state, and includes any savings bank, as defined in Section 3(g) of the Federal Deposit Insurance Act (12 U.S.C. Sec. 1813(g)), that is organized under the laws of a state other than this state.
(b) When used with respect to an office of a bank, means an office that is located in a state other than this state.
(c) When used with respect to a corporation other than a bank, means a corporation that is organized under the laws of any state of the United States other than this state or under the laws of the United States.
(a) When used with respect to a bank, means a bank that is organized under the laws of any state of the United States other than this state, or a national bank that maintains its main office in any state of the United States other than this state, and includes any savings bank, as defined in Section 3(g) of the Federal Deposit Insurance Act (12 U.S.C. Sec. 1813(g)), that is organized under the laws of a state other than this state.
(b) When used with respect to an office of a bank, means an office that is located in a state other than this state.
(c) When used with respect to a corporation other than a bank, means a corporation that is organized under the laws of any state of the United States other than this state or under the laws of the United States.
"Insured":
(a) When used with respect to a bank or an office of a bank, means a bank or office the deposits of which are insured by the Federal Deposit Insurance Corporation under the Federal Deposit Insurance Act (12 U.S.C. Sec. 1811 et seq.).
(b) When used with respect to a deposit, means a deposit that is insured by the Federal Deposit Insurance Corporation under the Federal Deposit Insurance Act (12 U.S.C. Sec. 1811 et seq.).
(a) When used with respect to a bank or an office of a bank, means a bank or office the deposits of which are insured by the Federal Deposit Insurance Corporation under the Federal Deposit Insurance Act (12 U.S.C. Sec. 1811 et seq.).
(b) When used with respect to a deposit, means a deposit that is insured by the Federal Deposit Insurance Corporation under the Federal Deposit Insurance Act (12 U.S.C. Sec. 1811 et seq.).
"Law of the domicile" means:
(a) When used with respect to a national bank, the law of the United States.
(b) When used with respect to a state bank, the law of the state of the United States under which the bank is organized.
(c) When used with respect to a foreign (other nation) bank, the law of the foreign nation under which the bank is organized.
(a) When used with respect to a national bank, the law of the United States.
(b) When used with respect to a state bank, the law of the state of the United States under which the bank is organized.
(c) When used with respect to a foreign (other nation) bank, the law of the foreign nation under which the bank is organized.
"Licensee" has the following meanings:
(a) Any bank authorized by the commissioner pursuant to Section 1042 to transact banking or trust business.
(b) Any industrial bank authorized by the commissioner pursuant to Section 1042 to transact industrial banking business.
(c) Any trust company authorized by the commissioner pursuant to Section 1042 to transact trust business.
(d) Any foreign (other nation) bank that is licensed under Article 2 (commencing with Section 1780) of Chapter 20 or under Article 3 (commencing with Section 1800) of Chapter 20.
(e) Any person licensed by the commissioner as a money transmitter pursuant to Division 1.2 (commencing with Section 2000).
(f) Any person authorized by the commissioner to conduct the business of a savings association pursuant to Division 2 (commencing with Section 5000).
(g) Any credit union authorized by the commissioner to conduct business pursuant to Section 14154.
(h) Any foreign (other state) credit union licensed by the commissioner to conduct business pursuant to Chapter 11 (commencing with Section 16000) of Division 5.
(i) Any foreign (other nation) credit union licensed by the commissioner to conduct business pursuant to Chapter 12 (commencing with Section 16500) of Division 5.
(j) Any industrial loan company authorized by the commissioner to conduct insurance premium finance business pursuant to Division 7 (commencing with Section 18000).
(k) Any corporation licensed by the commissioner as a business and industrial development corporation pursuant to Section 31154.
(a) Any bank authorized by the commissioner pursuant to Section 1042 to transact banking or trust business.
(b) Any industrial bank authorized by the commissioner pursuant to Section 1042 to transact industrial banking business.
(c) Any trust company authorized by the commissioner pursuant to Section 1042 to transact trust business.
(d) Any foreign (other nation) bank that is licensed under Article 2 (commencing with Section 1780) of Chapter 20 or under Article 3 (commencing with Section 1800) of Chapter 20.
(e) Any person licensed by the commissioner as a money transmitter pursuant to Division 1.2 (commencing with Section 2000).
(f) Any person authorized by the commissioner to conduct the business of a savings association pursuant to Division 2 (commencing with Section 5000).
(g) Any credit union authorized by the commissioner to conduct business pursuant to Section 14154.
(h) Any foreign (other state) credit union licensed by the commissioner to conduct business pursuant to Chapter 11 (commencing with Section 16000) of Division 5.
(i) Any foreign (other nation) credit union licensed by the commissioner to conduct business pursuant to Chapter 12 (commencing with Section 16500) of Division 5.
(j) Any industrial loan company authorized by the commissioner to conduct insurance premium finance business pursuant to Division 7 (commencing with Section 18000).
(k) Any corporation licensed by the commissioner as a business and industrial development corporation pursuant to Section 31154.
"Majority-owned subsidiary" has the meaning set forth for
"subsidiary" in subdivision (a) of Section 189 of the Corporations
Code.
"Member of the public" means any person, except an agent,
officer, or employee of the department acting within the scope of his
or her agency, office, or employment. Member of the public does not
include a director, officer, employee, attorney, accountant, or
consultant of a licensee, provided that the confidential information
in question only pertains to the licensee that employs or utilizes
the director, officer, employee, attorney, accountant, or consultant.
"Money transmitter" means a person authorized pursuant to
Chapter 3 (commencing with Section 2030) of Division 1.2 to engage in
the business of money transmission.
(a) "National bank" or "national banking association" means a
national banking association organized under the National Bank Act.
(b) For purposes of the Financial Institutions Law, a national bank is deemed to be a corporation.
(b) For purposes of the Financial Institutions Law, a national bank is deemed to be a corporation.
"Officer" means:
(a) When used with respect to a corporation, any person appointed or designated as an officer of the corporation by or pursuant to applicable law or the articles of incorporation or bylaws of the corporation or any person who performs with respect to the corporation functions usually performed by an officer of a corporation.
(b) When used with respect to a specified person other than a natural person or a corporation, any person who performs with respect to the specified person, functions usually performed by an officer of a corporation with respect to the corporation.
(a) When used with respect to a corporation, any person appointed or designated as an officer of the corporation by or pursuant to applicable law or the articles of incorporation or bylaws of the corporation or any person who performs with respect to the corporation functions usually performed by an officer of a corporation.
(b) When used with respect to a specified person other than a natural person or a corporation, any person who performs with respect to the specified person, functions usually performed by an officer of a corporation with respect to the corporation.
"Officers' certificate" has the meaning set forth in Section
173 of the Corporations Code.
"Resulting," when used with respect to a corporation, means:
(a) In the case of a consolidation, the corporation into which the constituent corporations are consolidated.
(b) In the case of a conversion, the corporation into which the converting corporation is converted.
(a) In the case of a consolidation, the corporation into which the constituent corporations are consolidated.
(b) In the case of a conversion, the corporation into which the converting corporation is converted.
"ROCA supervisory rating" shall have the meaning set forth in
Section 327.8(k) of Title 12 of the Code of Federal Regulations.
"Savings association" includes a savings association, a
savings and loan association, and a savings bank. However, "savings
association" does not include any savings bank of the type defined in
Section 3(g) of the Federal Deposit Insurance Act (12 U.S.C. Section
1813(g)).
"Series," when used with respect to shares, has the meaning
set forth in Section 183 of the Corporations Code.
"Shares" has the meaning set forth in Section 184 of the
Corporations Code.
"Shareholder" has the meaning set forth in Section 185 of the
Corporations Code.
"State":
(a) When used with respect to a corporation, means a corporation that is organized under the laws of a state of the United States.
(b) When used with respect to an office of a foreign (other nation) bank, means an office that the bank is authorized to maintain under the laws of a state of the United States.
(a) When used with respect to a corporation, means a corporation that is organized under the laws of a state of the United States.
(b) When used with respect to an office of a foreign (other nation) bank, means an office that the bank is authorized to maintain under the laws of a state of the United States.
"State of the United States" means any state of the United
States, the District of Columbia, any territory of the United States,
Puerto Rico, Guam, American Samoa, the Trust Territory of the
Pacific Islands, the Virgin Islands, and the Northern Mariana
Islands.
"Surviving," when used with respect to a corporation, means a
corporation in which one or more other corporations are merged.
"Uniform Interagency Trust Rating System (UITRS)" shall have
the meaning set forth in the policy statement regarding the uniform
interagency trust rating system published by the Federal Financial
Institutions Examination Council on October 13, 1998 (63 Fed. Reg.
54704).
"Uniform Rating System for Informational Technology (URSIT)"
shall have the meaning set forth in the policy statement regarding
the uniform rating system for information technology published by the
Federal Financial Institutions Examination Council on January 20,
1999, and implemented on or before April 1, 1999 (64 Fed. Reg. 3109).
"Vote" has the meaning set forth in Section 194 of the
Corporations Code.
"Voting power" has the meaning set forth in Section 194.5 of
the Corporations Code.
