17:9A-419. Definitions relative to foreign banks

38. As used in sections 37 through 86 of P.L.1996, c.17 (C.17:9A-418 through C.17:9A-467):

"Agency" means any place of business of a foreign bank at which credit balances are maintained, checks are paid, money is lent, or, to the extent not prohibited by federal law, deposits are accepted from a person or entity that is not a citizen or resident of the United States. Obligations shall not be considered credit balances unless they are:

(1) Incidental to, or arise out of the exercise of, other lawful banking powers;

(2) To serve a specific purpose;

(3) Not solicited from the general public;

(4) Not used to pay routine operating expenses such as salaries, rent, or taxes in the United States;

(5) Withdrawn within a reasonable period of time after the specific purpose for which they were placed has been accomplished; and

(6) Drawn upon in a manner reasonable in relation to the size and nature of the account.

"Banking Act" means "The Banking Act of 1948," P.L.1948, c.67 (C.17:9A-1 et seq.).

"Banking subsidiary," with respect to a specified foreign bank, means a bank that is a subsidiary as the terms "bank" and "subsidiary" are defined in section 2 of the federal "Bank Holding Company Act of 1956," 12 U.S.C. 1841.

"Branch" means any place of business of a foreign bank at which deposits are received and that is not an agency, as that term is defined in this section.

"Business in this State," when used with respect to a foreign bank which is licensed to establish one or more agencies or branch offices, includes, without limitation, the aggregate business of all those offices and agencies.

"Change the status of an office" means convert a representative office into a branch or agency, or an agency into a branch, or the reverse of the foregoing, but does not include renewal of the license of an existing office.

"Commercial lending company" means any organization, other than a bank or an organization operating under section 25 of the Federal Reserve Act, 12 U.S.C. 601-604a, organized under the laws of any state of the United States or a foreign country, that maintains credit balances permissible for an agency and engages in the business of making commercial loans. "Commercial lending company" includes any company chartered under Article XII of the banking law of the State of New York.

"Commissioner" means the Commissioner of Banking of New Jersey.

"Controlling person," when used with respect to a foreign bank, means any person who, directly or indirectly, controls that bank.

"Department" means the Department of Banking of New Jersey.

"To establish" or "establish" means to:

(1) Open and conduct business through an office;

(2) Acquire directly, through merger, consolidation, or similar transaction with another foreign bank, the operations of an office that is open and conducting business;

(3) Acquire an office through the acquisition of a foreign bank subsidiary that will cease to operate in the same corporate form following the acquisition;

(4) Change the status of an office; or

(5) Relocate an office from one physical location to another, unless the new office is in the same building as the existing office.

"Executive officer," when used with respect to a foreign bank or a controlling person of a foreign bank, means the chief executive officer, the chief operating officer, the chief financial officer, and any other person who participates or has authority to participate in major policy-making functions of such bank or controlling person. "Executive officer," when used with respect to a foreign bank, includes the head of the international division, or, if there is no such division, the closest equivalent division or unit of that bank.

"Federal agency" has the meaning set forth in section 1(b) of the "International Banking Act of 1978," 12 U.S.C. 3101.

"Federal branch" has the meaning set forth in section 1(b) of the "International Banking Act of 1978," 12 U.S.C. 3101.

"FDIC" means the Federal Deposit Insurance Corporation established pursuant to "Federal Deposit Insurance Act," 12 U.S.C. 1811 et seq.

"Federal Reserve" means the Board of Governors of the Federal Reserve System.

"Foreign country" means any nation other than the United States, including, without limitation, any subdivision, territory, trust territory, dependency, or possession of any such nation. With respect to banks which do not have deposit insurance with the FDIC, "foreign country" also includes Puerto Rico, Guam, American Samoa, the Virgin Islands, and any territory, trust territory, dependency, or insular possession of the United States.

"Foreign bank" means an organization that is organized under the laws of a foreign country and that engages directly in the business of banking outside of the United States. The term "foreign bank" does not include a central bank of a foreign country that does not engage in a commercial banking business in the United States through an office.

"Foreign banking organization" means a foreign bank that operates a branch, agency or commercial lending company subsidiary in the United States or that controls a bank in the United States and any company of which such foreign bank is a subsidiary.

"License" means a license issued under sections 37 through 86 of P.L.1996, c.17 (C.17:9A-418 through C.17:9A-467), authorizing a foreign bank or a commercial lending company to establish and to maintain an office; to be "licensed" means to be issued or to hold a license; and to be "licensed to transact business in this State," when used with respect to a foreign bank or a commercial lending company, means that the bank is licensed to establish an agency or branch office or commercial lending company.

"Loans and extensions of credit" means all direct and indirect advances of funds to a person made on the basis of any obligation of that person to repay funds.

"Office" or "office of a foreign bank" means any branch, agency, representative office, or commercial lending company subsidiary of a foreign bank in the United States.

"Organization" means a corporation, government, partnership, association, or any other entity.

"Person" means an individual or an organization.

"Primary office," when used with respect to a foreign bank which is licensed to establish a single office, means that office and, when used with respect to a foreign bank which is licensed to establish two or more offices, means one of those offices which that bank has designated as its primary office in accordance with section 51 of P.L.1996, c.17 (C.17:9A-432).

"Representative office" means any place of business of a foreign bank that is not a branch, agency, or subsidiary of the foreign bank.

"State of the United States" means any state of the United States or the District of Columbia.

"Subsidiary" means an organization, 25 percent or more of whose voting shares is directly or indirectly owned, controlled, or held with the power to vote by a company, including a foreign bank or foreign banking organization, or any organization that is otherwise controlled or capable of being controlled by a foreign bank or foreign banking organization.

L.1996,c.17,s.38.