Bill Text: MO HB329 | 2013 | Regular Session | Comm Sub
Bill Title: Changes the laws regarding financial institutions
Spectrum: Partisan Bill (Republican 2-0)
Status: (Passed) 2013-09-11 - Delivered to Secretary of State (G) [HB329 Detail]
Download: Missouri-2013-HB329-Comm_Sub.html
FIRST REGULAR SESSION
SENATE COMMITTEE SUBSTITUTE FOR
HOUSE BILL NO. 329
97TH GENERAL ASSEMBLY
Reported from the Committee on Financial and Governmental Organizations and Elections, April 25, 2013, with recommendation that the Senate Committee Substitute do pass.
TERRY L. SPIELER, Secretary.
1232S.03C
AN ACT
To repeal sections 361.160, 408.140, 408.590, 408.592, and 408.600, RSMo, and to enact in lieu thereof four new sections relating to financial institutions.
Be it enacted by the General Assembly of the State of Missouri, as follows:
Section A. Sections 361.160, 408.140, 408.590, 408.592, and 408.600, RSMo, are repealed and four new sections enacted in lieu thereof, to be known as sections 361.160, 408.140, 408.590, and 408.600, to read as follows:
361.160. 1. The director of finance at least once each year, either personally or by a deputy or examiner appointed by the director, shall visit and examine every bank and trust company organized and doing business under the laws of this state, and every other corporation which is by law required to report to the director; except, for banks or trust companies receiving a Camel/MOECA 1 or Camel/MOECA 2 rating from the division of finance, the director of finance at least once each eighteen calendar months, or for a private trust company at least once each thirty-six months, either personally or by a deputy or examiner appointed by the director, shall visit and examine such bank or trust company, and the director of finance, at the director's discretion, may conduct the director's examination, or any part thereof, on the basis of information contained in examination reports of other states, the Federal Deposit Insurance Corporation or the Federal Reserve Board or in audits performed by certified public accountants. For purposes of this subsection, a private trust company is one that does not engage in trust company business with the general public or otherwise hold itself out as a trustee or fiduciary for hire by advertising, solicitation, or other means and instead operates for the primary benefit of a family, relative of same family, or single family lineage, regardless of whether compensation is received or anticipated. The director shall be afforded prompt and free access to any workpapers upon which a certified public accountant bases an audit. A certified public accountant shall retain workpapers for a minimum of three years after the date of issuance of the certified public accountant's report to the bank or trust company. The director or the director's agent may concentrate the examinations on institutions which the director believes have safety or soundness concerns.
2. The director, or the deputy or examiners designated by the director for that purpose, shall have power to examine any such corporation whenever, in the director's judgment, it may be deemed necessary or expedient, and shall have power to examine every agency located in this state of any foreign banking corporation and every branch in this state of any out-of-state bank, for the purpose of ascertaining whether it has violated any law of this state, and for such other purposes and as to such other matters as the director may prescribe.
3. The director and the director's deputy and examiners shall have power to administer oaths to any person whose testimony may be required in such examination or investigation of any such corporation or agency, and to compel the appearance and attendance of any person for the purpose of any such examination or investigation.
4. On every such examination inquiry shall be made as to the condition and resources of such corporation, the mode of conducting and managing its affairs, the actions of its directors or trustees, the investment of its funds, the safety and prudence of its management, the security afforded to its creditors, and whether the requirements of its charter and of law have been complied with in the administration of its affairs, and as to such other matters as the director may prescribe.
5. The director may also make such special investigations as the director deems necessary to determine whether any individual or corporation has violated any of the provisions of this law.
6. Such examination may be made and such inquiry instituted or continued in the discretion of the director after the director has taken possession of the property and business of any such corporation, until it shall resume business or its affairs shall be finally liquidated in accordance with the provisions of this chapter.
7. The result of each examination shall be certified by the director or the examiner upon the records of the corporation examined and the result of all examinations during the biennial period shall be embodied in the report to be made by the director of the department of insurance, financial institutions and professional registration to the legislature.
8. The director may contract with regulators in other states to provide for the examination of Missouri branches of out-of-state banks and branches of banks whose home state is Missouri. The agreements may provide for the payment by the home state of the cost of examinations conducted by the host state at the request of the home state regulators.
408.140. 1. No further or other charge or amount whatsoever shall be directly or indirectly charged, contracted for or received for interest, service charges or other fees as an incident to any such extension of credit except as provided and regulated by sections 367.100 to 367.200 and except:
(1) On loans for thirty days or longer which are other than "open-end credit" as such term is defined in the federal Consumer Credit Protection Act and regulations thereunder, a fee, not to exceed [five] ten percent of the principal amount loaned not to exceed seventy-five dollars may be charged by the lender; however, no such fee shall be permitted on any extension, refinance, restructure or renewal of any such loan, unless any investigation is made on the application to extend, refinance, restructure or renew the loan;
(2) The lawful fees actually and necessarily paid out by the lender to any public officer for filing, recording, or releasing in any public office any instrument securing the loan, which fees may be collected when the loan is made or at any time thereafter; however, premiums for insurance in lieu of perfecting a security interest required by the lender may be charged if the premium does not exceed the fees which would otherwise be payable;
(3) If the contract so provides, a charge for late payment on each installment or minimum payment in default for a period of not less than fifteen days in an amount not to exceed five percent of each installment due or the minimum payment due or fifteen dollars, whichever is greater, not to exceed fifty dollars. If the contract so provides, a charge for late payment on each twenty-five dollars or less installment in default for a period of not less than fifteen days shall not exceed five dollars;
(4) If the contract so provides, a charge for late payment for a single payment note in default for a period of not less than fifteen days in an amount not to exceed five percent of the payment due; provided that, the late charge for a single payment note shall not exceed fifty dollars;
(5) Charges or premiums for insurance written in connection with any loan against loss of or damage to property or against liability arising out of ownership or use of property as provided in section 367.170; however, notwithstanding any other provision of law, with the consent of the borrower, such insurance may cover property all or part of which is pledged as security for the loan, and charges or premiums for insurance providing life, health, accident, or involuntary unemployment coverage;
(6) Reasonable towing costs and expenses of retaking, holding, preparing for sale, and selling any personal property in accordance with section 400.9;
(7) Charges assessed by any institution for processing a refused instrument plus a handling fee of not more than twenty-five dollars;
(8) If the contract or promissory note, signed by the borrower, provides for attorney fees, and if it is necessary to bring suit, such attorney fees may not exceed fifteen percent of the amount due and payable under such contract or promissory note, together with any court costs assessed. The attorney fees shall only be applicable where the contract or promissory note is referred for collection to an attorney, and is not handled by a salaried employee of the holder of the contract;
(9) Provided the debtor agrees in writing, the lender may collect a fee in advance for allowing the debtor to defer up to three monthly loan payments, so long as the fee is no more than the lesser of fifty dollars or ten percent of the loan payments deferred, no extensions are made until the first loan payment is collected and no more than one deferral in a twelve-month period is agreed to and collected on any one loan; this subdivision applies to nonprecomputed loans only and does not affect any other subdivision;
(10) If the open-end credit contract is tied to a transaction account in a depository institution, such account is in the institution's assets and such contract provides for loans of thirty-one days or longer which are "open-end credit", as such term is defined in the federal Consumer Credit Protection Act and regulations thereunder, the creditor may charge a credit advance fee of up to the lesser of [twenty-five] seventy-five dollars or [five] ten percent of the credit advanced from time to time from the line of credit; such credit advance fee may be added to the open-end credit outstanding along with any interest, and shall not be considered the unlawful compounding of interest as that term is defined in section 408.120;
(11) A deficiency waiver addendum, guaranteed asset protection, or a similar product purchased as part of a loan transaction with collateral and at the borrower's consent, provided the cost of the product is disclosed in the loan contract, is reasonable, and the requirements of section 408.380 are met.
2. Other provisions of law to the contrary notwithstanding, an open-end credit contract under which a credit card is issued by a company, financial institution, savings and loan or other credit issuing company whose credit card operations are located in Missouri may charge an annual fee, provided that no finance charge shall be assessed on new purchases other than cash advances if such purchases are paid for within twenty-five days of the date of the periodic statement therefor.
3. Notwithstanding any other provision of law to the contrary, in addition to charges allowed pursuant to section 408.100, an open-end credit contract provided by a company, financial institution, savings and loan or other credit issuing company which is regulated pursuant to this chapter may charge an annual fee not to exceed fifty dollars.
408.590. 1. [Each division director shall cause each state financial institution which he supervises, licenses or charters and which has an office within a county or a city, such county or city having a population in excess of two hundred fifty thousand, to be examined periodically during which examination the following shall be determined:
(1) The number and total dollar amount of residential real estate loans originated, purchased, or foreclosed by the financial institution after January 1, 1980, in each of the following categories:
(a) Loans secured by residential real estate located outside the state of Missouri other than in counties contiguous to the state of Missouri;
(b) Loans secured by residential real estate located in the state of Missouri or in the counties of other states which counties are contiguous to the border of the state of Missouri, which number and dollar amount shall be further reported by the county in which the property is located;
(2) The number of residential real estate loan applications denied by the institution in which the real estate which was to secure the loan is situated in a county or city with a population in excess of two hundred and fifty thousand by such county or city;
(3) By a method to be determined by each division director, such facts as will enable the division director to conclude whether or not the institution has engaged or is engaged in any practice in violation of sections 408.570 to 408.600.
2. Each division director may issue such regulations as are necessary to require the maintenance of records from which the conclusions required by this section can be determined.
3. Each division director shall report annually to the governor and the director of the department his findings made in accordance with the provisions of this section and which shall include information reported under the provisions of the Federal Home Mortgage Disclosure Act (12 U.S.C. 2801 et seq.), which findings shall be made as to the total industry he regulates, and by each county or city with a population in excess of two hundred fifty thousand. This report shall be maintained by the division as a public document for a period of five years.
4. The annual reports of the division directors shall state the method or methods used by the division director to reach his conclusions both in examination and analysis; and shall contain such facts as he deems necessary to support those conclusions, including but not limited to:
(1) The information required to be obtained by the provisions of subsection 1 of this section;
(2)] As to the state financial institutions under the supervision of the respective divisions, each division director shall report annually to the governor and the director of the department, with regard to each county or city with a population in excess of two hundred fifty thousand the following:
(1) The number and type of violations of sections 408.570 to 408.600 which are found to have occurred, a statement of the action or actions taken to enforce the provisions of said sections, and the names of the financial institutions which have been found upon a hearing to have violated the provisions of said sections[.
(3)]; and
(2) The number and nature of all complaints received by the department or division regarding alleged violations of any provision of sections 408.570 to 408.600 and the action taken on each complaint by the division.
2. This report shall be maintained by each division as a public document for a period of five years.
408.600. 1. Each division director shall enforce the provisions of sections 408.570 to 408.600. With respect to state financial institutions which he supervises, licenses or charters, each division director shall utilize the powers granted him under the general statutory authority by which he regulates, supervises, licenses, or charters such institutions, as well as the powers granted him by sections 408.570 to 408.600. The director of the division of finance shall enforce the provisions of sections 408.570 to 408.600 as they pertain to state financial institutions not supervised, licensed or chartered by a division director, and shall in that enforcement have such powers as are granted in said sections. The enforcement powers granted by subsections 2 through 5 of this section shall be utilized by the director of the division of finance concerning national banks, by the director of [savings and loan supervision] the division of finance concerning federal savings and loan associations, and by the director of credit unions concerning federal credit unions.
2. Any person who alleges to have been aggrieved as a result of a violation of section 408.575 or 408.580 may file a complaint with the appropriate division director. Within ninety days of the receipt of such complaint, the division director shall determine whether there is any reason to believe that a violation of section 408.575 or 408.580 has occurred. If the division director determines that there is such reason, then he shall undertake to resolve the complaint by negotiation or he shall conduct a hearing in accordance with the provisions of subsection 3 of this section, except that the hearing shall be held in the locality where the alleged violation occurred.
3. If the division director[, on the basis of an examination, an investigation of a complaint which has not been resolved by negotiation, a report required to be filed by section 408.592, or any public document or information,] has reason to believe that a violation of section 408.575 or 408.580 has occurred or does exist, the division director shall conduct a hearing in accordance with chapter 536. If the evidence establishes a violation of any provision of section 408.575 or 408.580, the division director may issue a cease and desist order stating specifically the unlawful practice to be discontinued, which order shall be served personally, or by certified mail. The decision of the division director shall be appealable directly to the circuit court pursuant to chapter 536.
4. If, after an order of the division director has become final, the director believes a violation of any provision of the order has occurred, he may seek an injunction to prohibit such violations in any court of competent jurisdiction. For each violation of such injunction, the court may assess a fine which may be recovered with costs by the state in any court of competent jurisdiction in an action to be prosecuted by the attorney general.
5. The remedies provided by this section shall not be interpreted as exclusive remedies but shall be in addition to remedies otherwise available to the director or to any individual damaged by a violation of sections 408.570 to 408.600.
[408.592. 1. Each state financial institution which is not supervised, licensed or chartered by a division director, which operates or has a place of business within a county having a population in excess of two hundred fifty thousand or a city not within a county and which originated an aggregate of five hundred thousand dollars or more in residential real estate loans in Missouri during the last calendar year shall, on or before a date of ninety days after the end of the fiscal year of the institution, file with the director of the division of finance an annual statement for each such county or city showing separately the number and total dollar amount of residential real estate loans both within and outside of that county or city which were:
(1) Originated by that institution during the preceding fiscal year;
(2) Purchased by that institution during the preceding fiscal year; and
(3) Foreclosed by that institution during the preceding fiscal year.
2. The information required to be filed under subsection 1 of this section shall be further itemized in order to clearly and conspicuously disclose the following:
(1) The number and dollar amount of each item by census tracts for residential real estate loans on property located within that county or city;
(2) The number and dollar amount of each item for all residential real estate loans on property located outside that county or city.
3. The information required to be filed under subdivisions (1) and (2) of subsection 1 shall also be itemized in order to clearly and conspicuously disclose the following:
(1) The number and dollar amount of loans made for the purchase of residential real estate which are insured under Title II of the National Housing Act or under Title V of the Housing Act of 1949 or which are guaranteed under Chapter 37 of Title 38, United States Code;
(2) The number and dollar amount of loans made for the purchase of residential real estate, including loans insured under federal housing insurance programs;
(3) The number and dollar amount of loans made for the repair, rehabilitation or remodeling of residential real estate.
4. Each statement filed under the provisions of this section shall be filed on forms approved or furnished by the director of the division of finance and shall be verified by two officers of the institution. Wherever possible, the director of the division of finance shall make the forms consistent with the disclosure forms required under the Federal Home Mortgage Disclosure Act of 1975 (12 U.S.C. 2801 et seq.).
5. The director of the division of finance shall maintain the statements filed under the provisions of this section for a period of not less than five years and shall make the statements available to the public for inspection during regular business hours and for copying at a cost not to exceed the actual cost to the division.]
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