(a) Any community bank organized pursuant to subsection (r) of section 36a-70 may, upon the approval of the commissioner, convert to a Connecticut bank that is authorized to operate without the limitations provided in subdivision (3) of subsection (r) of section 36a-70.

(b) A community bank that proposes to convert shall file with the commissioner a proposed plan of conversion, a copy of the proposed amended certificate of incorporation and a certificate by the secretary of the community bank that the proposed plan of conversion and proposed amended certificate of incorporation have been approved in accordance with subsection (c) of this section.

(c) The proposed plan of conversion and proposed amended certificate of incorporation shall require the approval of a majority of the governing board of the community bank and the favorable vote of not less than two-thirds of the holders of each class of the bank's capital stock, if any, or, in the case of a mutual community bank, the corporators thereof, cast at a meeting called to consider such conversion.

(d) Any shareholder of a capital stock community bank that proposes to convert who, on or before the date of the shareholders' meeting to vote on such conversion, objects to the conversion by filing a written objection with the secretary of such bank may, within ten days after the effective date of such conversion, make written demand upon the bank for payment of such shareholder's stock. Any such shareholder that makes such objection and demand shall have the same rights as those of a shareholder who asserts appraisal rights with respect to the merger of two or more capital stock Connecticut banks.

(e) The commissioner shall approve a conversion under this section if the commissioner determines that: (1) The community bank has complied with all applicable provisions of law; (2) the community bank has equity capital of at least five million dollars; (3) the community bank has received satisfactory ratings on its most recent state or federal safety and soundness examination and Community Reinvestment Act examination; and (4) the proposed conversion will serve the public necessity and convenience.

(f) After receipt of the commissioner's approval, the community bank shall promptly file such approval and its amended certificate of incorporation with the Secretary of the State and with the town clerk of the town in which its principal office is located. Upon such filing, the bank shall cease to be a community bank subject to the limitations provided in subdivision (3) of subsection (r) of section 36a-70 and shall be a Connecticut bank possessed of all rights, privileges and powers granted to it by its amended certificate of incorporation and by the provisions of the general statutes applicable to its type of Connecticut bank, and all of the assets, business and good will of the community bank shall be transferred to and vested in such Connecticut bank without any deed or instrument of conveyance, provided the converting bank may execute any deed or instrument of conveyance as is convenient to confirm such transfer. Such Connecticut bank shall be subject to all of the duties, relations, obligations, trusts and liabilities of the community bank, whether as debtor, depository, registrar, transfer agent, executor, administrator or otherwise, and shall be liable to pay and discharge all such debts and liabilities, to perform all such duties in the same manner and to the same extent as if the Connecticut bank had itself incurred the obligation or liability or assumed the duty or relation. All rights of creditors of the community bank and all liens upon the property of such bank shall be preserved unimpaired and the Connecticut bank shall be entitled to receive, accept, collect, hold and enjoy any and all gifts, bequests, devises, conveyances, trusts and appointments in favor of or in the name of the community bank and whether made or created to take effect prior to or after the conversion.

(g) The persons named as directors in the amended certificate of incorporation shall be the directors of such Connecticut bank until the first annual election of directors after the conversion or until the expiration of their terms as directors, and shall have the power to take all necessary actions and to adopt bylaws concerning the business and management of such Connecticut bank.

(h) No such Connecticut bank may exercise any of the fiduciary powers granted to Connecticut banks by law until express authority therefor has been given by the commissioner, unless such authority was previously granted to the community bank.

(i) The franchise tax required to be paid by capital stock Connecticut banks upon an increase of capital stock shall be paid upon the capital stock of any such Connecticut bank, provided, any franchise tax paid by the community bank shall be subtracted from any amount owed under this subsection.

(P.A. 97-209, S. 4, 6; P.A. 98-260, S. 9; P.A. 01-183, S. 7, 11; P.A. 02-47, S. 16.)

History: P.A. 97-209 effective June 24, 1997; P.A. 98-260 deleted former Subsec. (e) re public hearing, redesignated existing Subsec. (f) as Subsec. (e) and deleted provision re approvals needed for deposit insurance from Subdiv. (1), and redesignated existing Subsecs. (g) to (j) as Subsecs. (f) to (i); P.A. 01-183 replaced references to expansion of powers with references to conversion and made conforming and technical changes throughout, effective July 6, 2001; P.A. 02-47 amended Subsecs. (b), (c), (f) and (g) by adding provisions re amended certificate of incorporation and amended Subsec. (d) by replacing “dissents from” with “asserts appraisal rights with respect to”; Sec. 36a-252 transferred to Sec. 36a-139 in 2003.