Volume 6, Issue 1
Page 9
Commissioner’s authority
State Bank Department
expanded in emergencies
any of its directors, officers
or other employees would
not incur liability or forfeit
legal or equitable rights due
to the closure of an office.
By Richard S. Plotkin
Editor
The Commissioner is per-

mitted to authorize a bank
The Bank Commis- that has closed an office due
sioner would have the au- to a state of emergency to
thority under newly en- open a temporary office to
acted legislation to tempo- “help meet the credit, de-
rarily modify or suspend posit, and other financial
banking laws and regula- needs” of customers in the
tions in order to expedite affected area.
the recovery of a commu- Such facilities could in-
nity from an emergency. clude a mobile branch and
House Bill 1433 was temporary office space. This
passed in the regular ses- provision applies to loca-
sion of the 87
th
General tions in Arkansas and out of
Assembly, becoming Act state.
233 on February 25 after In emergency cases in-
being signed by Governor volving the establishment of
Mike Beebe. temporary facilities, the law
The law authorizes ap- states, the formal application
propriate action warranted process, normal require-
by a “state of emergency” ments and the fee would be
so that “customary bank- suspended.
ing services can continue Approval for a temporary
to be provided and finan- branch or facility would be
cial stability can be main-
tained.”
FEMA/Jocelyn Augustino
by written order from the
The term “state of
GOAL IS TO SPEED RECOVERY: A new law author-
Commissioner.
emergency” is defined in
izes the Bank Commissioner to take actions to assist com-
An order would be effec-
the law as a natural or
munities affected by flooding and other natural disasters.
tive for 120 days unless ter-
minated earlier by the Com-
man-made occurrence or The law permits the
ness on any one business missioner, based on indica-
condition that may affect Commissioner to declare,
day of each week. In ad- tions that the emergency has
the ability of a bank to with the consent of the
dition, state law requires passed.
conduct normal business governor, a state of emer-
notice of at least 90 days The Commissioner would
operations or may pose a gency – in all or part of
prior to the cessation of be authorized to extend an
threat to the safety or se- Arkansas – authorizing an
operations of a branch or order for up to 120 more
curity of a person or prop- Arkansas state-chartered
closing of the office. days if the Commissioner,
erty. bank located in an area
These requirements with the consent of the gov-
Such an occurrence or affected by the emergency
could be temporarily sus- ernor, determines the emer-
condition, the law states, to close an office immedi-
pended if the Commis- gency conditions that
could be caused by natural ately.
sioner exercises authority prompted the initial order
disaster; tornado; storm; A bank taking this ac-
under the new law. still exist.
flood; high water; earth- tion would be required to
The law provides that Lead sponsor for House
quake; drought; fire; act of notify the Commissioner
each day that an office is Bill 1433 was Representative
war, rebellion, violent as soon as conditions
closed due to emergency Bruce Maloch. The House
demonstration or terror- reasonably permit.
would be considered a approved the bill, 97-0. The
ism; or robbery of a finan- Arkansas statute allows
legal holiday. measure passed the Senate
cial institution. banks to close for busi-
An affected bank or by a vote of 35-0.
March 31, 2009
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