17:9A-418. Law, definitions, standards applicable to foreign banks

37. a. Sections 37 through 86 of P.L.1996, c.17 (C.17:9A-418 through C.17:9A-467) shall govern the establishment and operation in New Jersey of offices and certain commercial lending company affiliates of banks organized under the laws of a foreign country except that the operation of such foreign banks through subsidiary banks or depository institutions organized under the laws of the United States or any state of the United States, the deposits of which are insured by the Federal Deposit Insurance Corporation or any successor thereto, shall be governed by the other provisions of "The Banking Act of 1948," P.L.1948, c. 67 (C. 17:9A-1 et seq.).

b. For purposes of sections 37 through 86 of P.L.1996, c.17 (C.17:9A-418 through C.17:9A-467), unless the context clearly requires otherwise, the following terms shall be interpreted and applied in the same manner as the Federal Reserve interprets and applies the terms with respect to foreign banks and foreign banking organizations: "agency;" "branch;" "commercial lending company;" "to establish;" "foreign bank;" "foreign banking organization;" "office or office of a foreign bank;" "representative office;" and "subsidiary."

c. The provisions of sections 37 through 86 of P.L.1996, c.17 (C.17:9A-418 through C.17:9A-467) are intended to authorize foreign banks to establish and operate branches, agencies, commercial lending company affiliates and representative offices in this State and generally to ensure that interstate branches of foreign banks may be established and operated in this State to the extent consistent with the provisions of section 5 of the "International Banking Act of 1978," 12 U.S.C. 3103, and the regulations of the Federal Reserve promulgated thereunder, 12 CFR 211.20 et seq., and under terms and conditions that are generally comparable to and no less favorable than those applicable to the establishment of interstate federal branches in this State by foreign banks.

d. As provided in subsection e. of this section, a foreign bank may establish a branch or agency in this State in the same manner (including by merger or other transactions under the Federal Deposit Insurance Act, 12 U.S.C. 1831u, and comparable provisions of the laws of this State, with New Jersey banks or other institutions) as, and subject generally to the same criteria, standards, conditions, requirements and procedures applicable to the establishment of interstate branches in this State by an out-of-State bank having the same home state in the United States as the foreign branch or agency, notwithstanding any provisions of the laws or regulations of this State to the contrary.

e. In interpreting the provisions of sections 37 through 86 of P.L.1996, c.17 (C.17:9A-418 through C.17:9A-467), the commissioner:

(1) generally shall apply to the establishment of an initial office of a foreign bank whether or not the initial office is an interstate branch, and any subsequent intrastate offices of a foreign bank, the same criteria, standards, conditions, requirements and procedures applicable to the establishment of an initial branch in New Jersey by an out-of-State bank, and of subsequent intrastate branches in this State by an out-of-State bank;

(2) may apply any other criterion, standard, condition, requirement or provision of the laws or regulations of this State that is determined by the commissioner to be substantially equivalent to or consistent with a criterion, standard, condition, requirement or provision of federal law or regulation generally applicable to the establishment of offices in the United States by foreign banks or specifically applicable to the establishment of an office in the United States by the applicant foreign bank;

(3) may by regulation or order allow a foreign bank:

(a) to acquire an individual branch of any "insured bank," as that term is defined in the "Federal Deposit Insurance Act," 12 U.S.C. 1813(h), or of any other depository institution, including another foreign bank, without acquiring the entire bank or other institution;

(b) to acquire or merge with another foreign bank maintaining a branch or agency in this State and thereafter continue each operation as its own; or

(c) to acquire or establish an interstate office through any other means not inconsistent with section 5 of the "International Banking Act of 1978," 12 U.S.C. 3103.

For purposes of this section, "out-of-State bank" shall have the meaning given that term pursuant to section 1 of P.L.1948, c.67 (C.17:9A-1).

L.1996,c.17,s.37.