BANKING

DEPARTMENT OF BANKING AND INSURANCE

DIVISION OF BANKING

General Provisions

Proposed Readoption with Amendments: N.J.A.C 3:6

Proposed Repeals: N.J.A.C. 3:6-3.1, 5.2, 8.1, 15.1, and 17.1.

Proposed Recodification with Amendments: N.J.A.C. 3:6-1.1 as 12.3

Authorized By: Karen L. Suter, Commissioner, Department of Banking and Insurance

Authority: N.J.S.A. 17:1-8, 8.1 and 15, 17:9A-24, 24b.1, 28.2, 31, 43, 62H, 71 to 74, 182.1, 195, 256A, 333 and 334.

Proposal Number: PRN 2001-94

Submit comments by April 18, 2001 to:

Karen Garfing, Assistant Commissioner

Regulatory Affairs

New Jersey Department of Banking and Insurance

P.O. Box 325

Trenton, NJ 08625-0325

Fax: (609) 292-0896

Email: Legsregs@dobi.state.nj.us

The agency proposal follows:

Summary

The Department of Banking and Insurance ("Department") proposes to readopt N.J.A.C. 3:6, which is scheduled to expire on May 20, 2001 pursuant to Executive Order No. 66 (1978).

Subchapter 1, as it currently exists, governs parity of savings banks with Federal savings banks. The single section, N.J.A.C. 3:6-1.1, is proposed to be relocated with amendment and recodified as N.J.A.C. 3:6-12.3. This new location will place it near other parity sections. Definitions currently located at N.J.A.C. 3:6-3.1, 5.2, 8.1 and 17.1 are proposed for relocation in subchapter 1. The remaining sections of these subchapters would be appropriately recodified.

Subchapter 2 sets forth the approved depositories for investments comprising security funds. An amendment is proposed in N.J.A.C. 3:6-2.1. Currently, only banks, savings banks and national banking associations domiciled in New Jersey may be approved depositories. With recent mergers among institutions, many larger banks, savings banks and national banking institutions are no longer domiciled in New Jersey, although they have extensive operations here. The amendment proposed would eliminate the requirement that they be domiciled in New Jersey and substitute the requirement that they have a principal or branch office in New Jersey.

Subchapter 3 limits the amount of loans a bank may make to an executive officer. The amount may not exceed 2.5 percent of the capital funds of the bank or $25,000, whichever is greater, but in no event more than $100,000. Based on a statutory change at N.J.S.A. 17:9A-74(B)(3), there is no longer a limit on the amount of money a bank may loan an executive officer for his or her children’s education. N.J.A.C. 3:6-3.3, recodified is proposed to be amended to conform with this statute. The current general limit in subchapter 3 for non-educational loans remains intact.

Subchapter 4 remains reserved.

Subchapter 5 concerns the sales of Federal funds, which are defined as the temporary transfer and sale of immediately available funds either from one member bank in the Federal Reserve System to another member bank or to another bank not in the Federal Reserve System. The subchapter exempts liabilities arising under Federal funds transactions from the 15 percent of capital limitation on total loans and extensions of credit by a bank to one borrower at one time. An amendment is proposed in N.J.A.C. 3:6-5.1(a) and (b), to add the word "transferor" in order to clarify the rule. In addition, an amendment is proposed in N.J.A.C. 3:6-5.1(b) to delete the word "transferal," which is an error, and replace it with the accurate word "transferee."

Subchapter 6 permits a qualified bank to invest in variable account notes of a single borrower on a short-term basis. The subchapter sets standards for these instruments, and requires that records be maintained. The Department proposes to amend N.J.A.C. 3:6-6.6(a)3 to delete a reference to N.J.S.A. 17:9A-39(b) which has been repealed. In addition, the proposed language in N.J.A.C. 3:6-6.6(a)4 clarifies that subsection. N.J.S.A. 3:6-6.4 currently contains a very long sentence, the substance of which requires that if the borrower of cash held by a bank in various fiduciary accounts issues its own commercial paper, the interest rate on the note shall not be less than that which would yield the simple interest equivalent to the discount rate currently being paid by the borrower on its 180-day commercial paper. The proposed change would not alter that requirement, but would break the long sentence into two separate sentences. Lastly, a change is proposed in N.J.A.C. 3:6-6.6(a)4 to add a reference to N.J.S.A. 3B:20-11.1 et seq., the Prudent Investors Act. Lastly, a change is proposed in N.J.A.C. 3:6-6.6(a)4 to add a reference to N.J.S.A. 3B:20-11.1 et seq., the Prudent Investors Act.

Subchapter 7 remains reserved.

Subchapter 8 concerns the conversion of a savings bank to a savings and loan association or to a bank. In particular, it sets forth the application requirements, and permits the Commissioner to waive these requirements based on specified factors. The Department proposes to amend N.J.A.C. 3:6-8.2(a), recodified as 8.1(a). The section deals with conversion of a mutual savings bank into a mutual savings association. The reference to "capital stock association" in this context is an error and it is proposed for removal and replacement by "mutual associaiton."

Subchapter 9 shall be reserved. Current subchapter 9 is proposed for repeal. N.J.S.A. 17:9A-377 to 379, which required the Department to approve the change of control of a capital stock savings bank, has been repealed thereby removing the statutory authority for the current contents of the subchapter.

Subchapter 10 provides that unsecured days funds may be transferred only to a commercial bank whose deposits are insured by the Federal Deposit Insurance Corporation. An amendment is proposed to clarify that the total amount that may be sold to any one insured bank may not exceed 15 percent of the capital of the bank or savings bank and not such percentage of surplus. An amendment is also proposed to extend the requirements of the rule to banks, in addition to savings banks. An amendment would make it clear that "term Federal funds", also known as "unsecured day funds", are subject to the 15 percent of capital limitation on total loans and extensions of credit by a bank to one borrower at one time.

Subchapter 11 permits the investment on a short-term basis of cash held for various fiduciary accounts. In addition, the subchapter sets standards regarding these investments.

Subchapter 12 is proposed for minor amendment to recognize the merger of the Department of Banking into the Department of Banking and Insurance and the merger of the New Jersey Council of Savings Institutions, New Jersey's Community and Savings Bankers, and the New Jersey Savings League into the New Jersey League Community and Savings Bankers. In addition, the heading of the subchapter has been modified to reflect the additional parity section, N.J.A.C. 3:6-12.3, proposed to be recodified from N.J.A.C. 3:6-1.1. Recent changes to the parity statute will be addressed in a separate rulemaking in the near future. The complexity of the topic warrants a distinct proposal and adoption.

Subchapter 13 remains reserved.

Subchapter 14 contains the fee schedule for foreign banks seeking a certificate of authority to transact business in New Jersey. No amendments are proposed except for deletion of the fee set forth at N.J.A.C. 3:6-14.2(a)4 in accordance with the repeal of N.J.S.A. 17:9A-320. Further, N.J.A.C. 3:6-14.2 is proposed to be amended to provide that fees are paid to the Department rather than to the Commissioner.

Subchapter 15 permits a savings bank to lend to its officers and managers according to the same terms and limitations applicable to banks. The Department is proposing to repeal N.J.A.C. 3:6-15.1 and recodify its definition of "manager" as part of N.J.A.C. 3:6-15.2 which would in turn be recodified as N.J.A.C. 3:16-15.1. Further, the deletion of "capital funds" is proposed to be relocated to new subchapter 1 and the definition of "Board of Managers" deleted as unnecessary.

Subchapter 16 permits a qualified bank to acquire certain securities for one or more of its trust accounts from itself or an affiliate bank as defined therein, when the qualified bank or affiliate bank holds the security as a result of being the underwriter or a member of the underwriting syndicate of the security, so long as specified conditions are met. The definitions of "issues," "qualified bank," and "trust account" be deleted from N.J.A.C. 3:6-16.6 and relocated to N.J.A.C. 3:6-1.1

Subchapter 17 concerns the conversion of a bank to a savings bank. In particular, it sets forth the application requirements, and permits the Commissioner to waive these requirements based on specified factors.

The Department is also proposing to amend proposed N.J.A.C. 3:6-8.2(b) and 17.2(b). These subsections make identical provisions for the waiver of application requirements. The amended rules provide that it is the Commissioner who has the discretion to waive any requirements and that only one of the five reasons for granting the waiver need be satisfied. Further, the headings of subchapter 8 and 17 are proposed to be amended to reflect more accurately the nature of the applications contained in these subchapters.

The Department also is proposing amendments to the rules to recognize the merger of the Department of Banking and the Department of Insurance into the Department of Banking and Insurance, to make certain grammatical and spelling changes as a matter of form, to replace references to public laws with the current statutory citations and to update references in the rules to the current New Jersey Administrative Code.

The Department has reviewed the remaining rules and determined them to be necessary, reasonable and proper for the purpose for which they were originally promulgated.

Social Impact

The rules proposed for readoption with amendments apply to all banks and savings banks subject to supervision or regulation by the Department. They will continue to implement the pertinent statutes and the policies of the Department on a wide variety of subjects. The rules give banks substantial parity with their Federal and out-of-state counterparts; give savings banks substantial parity with Federal savings banks; regulate investments and deposits of banks and savings banks with other institutions; provide guidelines for loans to employees and other related persons and require an application to convert a savings bank into a bank or savings and loan association, or to convert a bank into a savings bank. The readoption of the rules on these vital subjects is necessary to prevent serious disruptions in both the private and public sectors.

The rules proposed for readoption with amendments will continue to enable the Department to carry out its mission of requiring banks and savings banks to engage in their business in a manner that is in accordance with safe and sound banking practices, protects consumers and yet frees banks and savings banks from unnecessary regulation in accordance with statutory authority. Thus, the rules proposed for readoption with amendments will continue to have a beneficial social impact on consumers and banks and savings banks.

Economic Impact

The Department does not expect that the rules proposed for readoption with amendments will have a significant economic impact on banks and savings banks. The rules will permit the Department to continue to collect the fees which are specified in subchapter 14, Foreign Bank charges. These fees have a small economic impact on the regulated industry.

The fee for a conversion from a mutual to a stock association of $3,500, from an association to a savings bank is $10,000 and from an association to a savings bank in a simultaneous application is $10,000. The Department believes that the continuation of the established fees is necessary and reasonable to cover the time spent by Department staff in consideration of such applications for conversions, and is anticipated by the banking industry when requesting such a conversion of an institution’s charter. Requesting the charter conversion will incur internal costs to prepare an application for conversion. Staff of the institution will need to complete and submit a business plan and financial projections, in addition to completing and assembling corporate records, providing copies of the most recent quarterly report, providing copies of applications for federal regulatory approval and providing biographical information on the incorporators and/or directors of the new charter entity. Outside professional assistance of accountants, financial advisors and attorneys may be employed by applicants for conversion.

Furthermore, these rules give banks and savings banks flexibility in making investment decisions within specified standards. This flexibility allows these institutions to make investment decisions based on their economic benefit.

Federal Standards Statement

The rules proposed for readoption with amendments do not contain standards or requirements that exceed standards or requirements imposed by Federal law. These rules continue to apply to New Jersey financial institutions certain Federal standards, set forth at 12 C.F.R 32.2(j)(1)(vi), 12 C.F.R. 32.3(a) and 12 C.F.R. 215. In addition, pursuant to the parity provisions in subchapter 12, banks and savings banks may become subject to additional Federal standards. While those Federal standards cannot be identified at this time, they shall in no event be exceeded by State standards

Jobs Impact

The Department does not anticipate that any jobs will be generated or lost as a result of the rules proposed for readoption with amendments. Banks and savings banks will use existing staff or retained outside professionals for continued compliance with the rules proposed for readoption with amendments.

The Department invites commenters to submit any data or studies concerning the jobs impact of the proposed readoption with amendments together with their written comments on other aspects of this proposal.

 

Agriculture Industry Impact

The Department does not expect any agriculture industry impact from the rules proposed for readoption with amendments.

Regulatory Flexibility Analysis

Some New Jersey banks and savings banks are small businesses as defined in the Regulatory Flexibility Act, N.J.S.A. 52:14B-16 et seq. The rules proposed for readoption with amendments will continue to impose recordkeeping, reporting and other compliance requirements on these entities, as discussed in the Summary above. Costs are discussed in the Economic Impact above. Much of the compliance requires professional assistance in the form of attorneys and accountants, the cost of which will vary from professional to professional depending on the services needed. The rules proposed for readoption with amendments will continue to require banks and savings banks to operate in a manner that is responsible to the industry, its customers and the general public. Moreover, the Department does not believe that these requirements are unduly burdensome. They are consistent with prudent banking practices. The purpose of these requirements does not vary based upon business size. Accordingly, no differentiation based on business size is provided.

Full text of the rules proposed for readoption may be found in the New Jersey Administrative Code at N.J.A.C. 3:6.

Full text of the proposed repeals may be found in the New Jersey Administrative Code at N.J.A.C. 3:6-3.1, 3:6-5.2, 3:6-8.1, 3:6-9, 3:6-15.1 and 3:6-17.1.

Full text of the proposed amendments follows (additions indicated in boldface thus; deletions indicated in brackets [thus]):

 

Subchapter 1. [ SAVINGS Bank Parity] DEFINITIONS

(Agency Note: N.J.A.C. 3:6-1.1 is proposed for recodification with amendments as N.J.A.C. 3:6-12.3.)

3:6-1.1 Definitions

The following words and terms, when used in the chapter, shall have the following meanings unless the context clearly indicates otherwise.

"Bank" means a bank as defined in N.J.S.A. 17:19A-1(1).

"Banking institution" means a bank, savings bank, an out-of-state bank having a branch office in this State, an out-of-country bank having a branch office in this State, and a national banking association having its principal or a branch office in this State.

"Capital funds" of a savings bank are deemed to include capital notes of the savings bank for purposes of computing lending limitations.

"Capital stock association" means a capital stock association as defined in N.J.S.A. 17:12B-244(a).

"Capital stock savings bank" means a savings bank organized or converted pursuant to N.J.S.A. 17:9A-8.1 to 8.17.

"De novo branch" means a new branch office of a banking institution or foreign bank established not by means of the acquisition of an existing insured depository institution or branch office of an insured depository institution or by the means of the conversion, merger, or consolidation of any such institution or branch office.

"Executive officer" means a person who participates or has authority to participate, other than in the capacity of a director, in major policy-making functions of the bank, whether or not: the person has an official title; the title contains a designation of assistant; or the person is serving without salary or other compensation. The chairman of the board, president, every vice president, cashier, secretary, treasurer and comptroller are considered to be executive officers, unless pursuant to resolution of the board of directors or the bylaws of the bank any such executive officer is excluded from participation in major policy-making functions, other than in the capacity of a director, and the executive officer does not actually participate therein.

"Foreign bank" means a company, other than a banking institution, organized under the laws of the United States, another state or a foreign government, which is authorized by the laws under which it is organized to exercise some or all of the powers specified in N.J.S.A. 17:9A-24(4), 25(4) (5) and (13), and 28(3) through (9).

"Insured depository institution" means any banking institution or state or Federally-chartered savings association, the deposits of which are insured by the Federal Deposit Insurance Corporation.

"Issuer" means a qualified bank that acts either by itself or with others as an underwriter of securities.

"Mutual association" means a mutual association as defined in N.J.S.A. 17:12B-5(31).

"Qualified bank" means a qualified bank as defined in N.J.S.A. 17:9A-1(12).

"Savings bank" means a savings bank as defined in N.J.S.A. 17:9A-1(13).

"State association" means a State association as defined in N.J.S.A. 17:12B-5(1).

"Trust account" means any account, relationship or arrangement administered by a qualified bank acting in any capacity as defined by N.J.S.A. 17:9A-28.

SUBCHAPTER 2. APPROVED [DEPOSITORIES] DEPOSITORIES FOR INVESTMENTS COMPROSING SECUTIRY FUNDS

3:6-2.1 Approved [depositories] depositories

The following institutions are approved as [depositories] depositories for investments comprising security funds created pursuant to [Section 31 of the Banking Act of 1948, as amended] N.J.S.A. 17:9A-31: [Banks] banks, savings banks and national banking associations [domiciled] having a principal or a branch office in New Jersey having total capital stock and surplus of at least $2,000,000 which are authorized to do a fiduciary business.

SUBCHAPTER 3 LIMIT ON LOANS TO AN EXECUTIVE OFFICER [PARTICIPATION IN MAJOR POLICY-MAKING FUNCTIONS OF A BANK]

3:6-[3.2] 3.1 (No change in text.)

3:6-[3.3] 3.2 Exclusion

[Loans] In accordance with N.J.S.A. 17:9A-74B(3), loans to finance the education of an executive officer’s children[, which exceed the $20,000 amount provided in N.J.S.A. 17:9A-74B(5),] are excluded from the limitations set out in N.J.A.C. 3:6[3.2] 3.1.

 

SUBCHAPTERS. FEDERAL FUNDS TRANSACTING

3:6-5.1 Exclusion from limitation on liability

(a) In "sales of Federal funds," the liability of a transferee bank to a transferor bank shall not be subject to any limitation on liability to a transferor bank imposed by [Article 13 of the Banking Act of 1948, as amended] N.J.S.A. 17:9A-62.

(b) In sales of Federal funds, the liability of a [transferal] transferee bank to a transferor savings bank shall not be subject to any limitation on liability to [the] a transferor savings bank.

N.J.A.C. 3:6-[5.3] 5.2 (No change in text.)

SUBCHAPTER 6. SHORT-TERM INVESTMENT OF CASH IN FIDUCIARY ACCOUNTS

3:6-6.2 Provisions of note

(a) Under this arrangement, the borrower delivers [his] its note to evidence the amount of the loan outstanding from time to time.

(b)-(e) (No Change.)

3:6-6.4 Confirmation of changes in loan; provision for interest rate

On the following business day, the net figure referred to in [Section 6.3] N.J.A.C. 3:6-6.3 [(]Fluctuations in participations[) of the Chapter], must be communicated to the borrower by telephone. If the figure indicates a proposed increase in the loan, this communication is an offer to lend the amount of the increase which the borrower may either accept or reject in whole or in part[, or reject]. If the figure indicates a proposed reduction in the loan, communication constitutes a demand for payment of the amount of the reduction. The resulting increase or decrease in the loan and the new balance due must be then recorded by making appropriate entries on the note. The balance so entered, when confirmed by the borrower in writing, should be understood to constitute conclusive evidence of the balance owing on the loan. The net amount of any increase (or decrease) in the loan must be promptly credited to (or charged against) the borrower's account with the bank. Interest must be paid monthly on the daily amount of the loan outstanding during the preceding month at a rate which is mutually agreed upon by the bank and the borrower and specified in the note or related agreement[,] . [but such] In the event the borrower issues its own commercial paper, the interest rate shall not be less than that which will yield the simple interest equivalent to the discount rate currently being paid by the borrower on [his] its 180-day commercial paper. If any change in the 180-day rate is established by the borrower, the rate of interest paid on the variable amount loan must be changed simultaneously, unless a rate higher than the 180-day rate has been agreed upon and is being paid.

3:6-6.6 Authorization to invest in this type of collective investment

(a) Where collective investments of the type described in this subchapter are not specifically authorized by the governing instruments of the various participating accounts, such investments may be made pursuant to N.J.S.A 17:9A-37 and in such case:

1. - 2. (No Change.)

3. [The requirements of N.J.S.A. 17:9A-39(b) shall be deemed satisfied provided that the] The note is of a borrower whose commercial paper is rated at least A-1 by the financial periodicals rating commercial paper (for example, Standard and Poor) and such note is either payable on demand or at the call of the bank; and

4. The determination of whether such collective investment shall constitute a legal common trust fund or a discretionary common trust fund shall be determined in accordance with the provisions of N.J.S.A. 17:9A-[36] 38D and the Prudent Investor Act, N.J.S.A. 3B:20-11.1 et seq.

SUBCHAPTER 8. CONVERSIONS OF SAVINGS BANK[S] CHARTERS

3:6-[8.2]8.1 Authorization for conversion

(a) Any mutual savings bank may apply to the Commissioner to convert itself to a mutual association by organizing and transferring its assets and liabilities to a newly-chartered [capital stock] mutual association, and any capital stock savings bank may apply to the Commissioner to convert itself to a bank by organizing and transferring its assets and liabilities to a newly-chartered bank.

(b) - (c) (No change.)

3:6-[8.3]8.2 Application for conversion

(a) (No change.)

(b) The [Department] Commissioner may, in [its] his or her discretion, waive any of the application requirements of (a) above based on any of the following:

1.-3. (No change.)

4. Whether the conversion is one step in an integrated application; [and] or

5. Any other factor which may [reflect on] affect the need for a review of [all] any of the materials [required] specified in (a) above.

SUBCHAPTER 10. [SAVINGS BANKS;] UNSECURED DAYS FUNDS TRANSACTIONS

3:6-10.2 Limitation on such investments

A bank or savings bank may sell unsecured days funds (term [federal] Federal funds) to any insured bank, as defined in N.J.A.C. 3:6-10.1, provided the total amount sold to any one insured bank does not exceed 15 percent of the [surplus] capital funds of the bank or savings bank as reported in the latest consolidated report of condition on file with the Department of Banking and Insurance.

SUBCHAPTER 12. STATE BANK AND SAVINGS BANK PARITY

3:6-12.1 State bank parity with national banks

In addition to other authority granted by law, [an]and unless contrary to State law, a bank may exercise any power, right, benefit or privilege which is now or hereafter authorized for national banks pursuant to Federal law or rules or regulations of the Comptroller of the Currency, the Federal Reserve Board and the Federal Deposit Insurance Corporation. Any such power shall be exercised upon the same terms and subject to the same conditions as are authorized for national banks. The powers, rights, benefits or privileges shall be automatically exercisable upon the expiration of 30 days from the date of adoption by the Federal regulatory agency, except if the Commissioner of Banking and Insurance within that 30 day period provides notice that the power shall not be granted to State banks. Such notice shall be provided to each bank, and to the trade publications of [the Savings Banks' Association of New Jersey,] the New Jersey Bankers Association and the New Jersey [Savings] League Community and Savings Bankers, and/or their successor organizations, if any, for publication. The Commissioner of Banking and Insurance may permit banks to begin exercise of a power prior to the expiration of the 30 day period by providing notice of permission to each bank and to the above mentioned trade publications.

3:6-12.2 State bank parity with out-of-State banks

In addition to other authority granted by law, and unless contrary to State law, a bank may exercise any power, right, benefit or privilege which is now or hereafter authorized by statute or regulation for a state chartered bank chartered in a state other than New Jersey, provided that the bank provides notice to the Commissioner of Banking and Insurance prior to exercising this power, right, benefit or privilege and the Commissioner of Banking and Insurance either specifically approves the activity or does not provide notice before the expiration of 45 days that the power, right, benefit or privilege is not appropriate for New Jersey institutions. In deciding whether the power, right, benefit or privilege is appropriate for New Jersey institutions, the Commissioner of Banking and Insurance shall consider the effect on the safety and soundness of the institution and the consumer benefit or detriment of permitting institutions to engage in the activity, if any.

3:6-[1.1] 12.3 Savings banks parity with Federally chartered savings banks

In addition to other authority granted by law, a savings bank may exercise any power which is now or hereafter authorized for Federally chartered savings banks pursuant to Federal law or rules or regulations of the Office of Thrift Supervision or any other appropriate Federal [Regulator] regulator. Any such power shall be exercised upon the same terms and subject to the same conditions as are authorized for Federally chartered savings banks. Powers shall be automatically exercisable upon the expiration of 30 days from the date of adoption by the Federal regulatory agency, except if the Commissioner of Banking and Insurance within that 30-day period provides notice that the power shall not be granted to New Jersey savings banks. Such notice shall be provided to each savings bank, and to the trade publications [the New Jersey’s Community and Savings Bankers] of the New Jersey Bankers Association and the New Jersey League [Savings] Community and Savings Bankers, and/or their successor organizations, if any, for publication. The Commissioner of Banking and Insurance may permit savings banks to begin exercise of a power prior to the expiration of the 30-day period by providing notice of permission to each savings bank and to the above-mentioned trade publications.

SUBCHAPTER 14. FOREIGN BANKS

3:6-14.2 Miscellaneous fees

(a) A foreign bank shall pay to the [Commissioner] Department of Banking and Insurance the following fees:

1.-2. (No change.)

3. For filing a power of attorney……………………………….$25.00[;].

[4. For each substitution of securities, pursuant to N.J.S.A. 17:9A-320B……………………………………………………………$100.00.]

SUBCHAPTER 15. SAVINGS BANKS; OFFICERS AND MANAGERS PERMITTED LOANS

3:6-[15.2] 15.1 Terms and conditions

(a) A savings bank may permit its officers and managers and their families and affiliates to become liable to the savings bank only under the same terms and conditions and to the same degree of liability as a bank permits its directors, officers or the corporations or partnerships of the officers or directors of a bank to become liable to a bank under [the provision of Article 15 of the Banking Act of 1948 ( ] N.J.S.A. 17:9A-71 [et seq. ) and under] to 74, N.J.S.A. 17:9A-104[,] and N.J.A.C. 3:1-11 and 3:6-3 [the regulations issued pursuant to both].

(b) A savings bank may not permit its officers and managers and their families and affiliates to become liable to the savings bank pursuant to the authority of N.J.A.C. 3:6-[1.1]12.

(c) (No change.)

(d) "Manager" of a savings bank means a trustee or director of a savings bank and where reference is made to a director of a bank it shall be deemed to refer to the manager of a savings bank.

SUBCHAPTER 16. QUALIFIED BANK ACQUISITION OF UNDERWRITING SECURITIES

3:6-16.1 Definitions

The following words and terms, when used in the chapter, shall have the following meanings unless the context clearly indicates otherwise:

["Trust account" means any account, relationship or arrangement administered by a qualified bank acting in any capacity as defined by N.J.S.A. 17:9A-28.]

["Issuer" means a qualified bank that acts either by itself or with others as an underwriter of securities.

"Qualified bank" means a qualified bank as defined in subsection (12), Section 1 of The Banking Act of 1948.]

SUBCHAPTER 17. CONVERSIONS OF BANK[S] CHARTERS

3:6-[17.2] 17.1 (No change in text)

3:6-[17.3]7.2 Application for conversion

(a) (No Change.)

(b) The [Department] Commissioner may, in [its] his or her discretion, waive any of the application requirements of (a) above based on any of the following:

1.-3. (No change.)

4. Whether the conversion is one step in an integrated application; [and] or

5. Any other factor which may [reflect on] affect the need for a review of [all] any of the materials [required] specified in (a) above.