Reciprocal interstate branch banking legislation was passed unanimously by Wisconsin’s legislators and was signed into law recently by Governor Doyle. Wisconsin’s new interstate branch banking law became effective on April 11, 2006. We wanted to alert you to what your bank’s rights and privileges are under this new law. There are two aspects to Wisconsin’s new branching law: one relates purely to branching ability, and the second relates to starting new bank charters. Interstate Branching.Under Wisconsin’s new reciprocal interstate branching law, Wisconsin state banks and national banks located in Wisconsin may apply to open an interstate branch in Illinois, Michigan, Indiana, North Dakota, or in approximately fifteen other states which have adopted reciprocal interstate branching laws. Minnesota and Iowa are two contiguous states with Wisconsin which have not adopted reciprocal branching. Attached is a list of the states which have adopted reciprocal interstate branching. To open a branch in a reciprocal state, a Wisconsin bank would have to file an interstate branch application with its appropriate federal regulator, and also with the "host" state regulator (e.g., the Michigan or Illinois Banking Departments.) Similarly, state banks or national banks located in states which have adopted branching legislation reciprocal with Wisconsin will now be able to apply to open branches in Wisconsin. In order to open a branch in this state, Wisconsin DFI will have to approve an application from the out-of-state bank, including first making a determination that the laws of that state would permit a Wisconsin bank to open a branch in that state. Wisconsin’s new branching law applies only to Wisconsin state chartered commercial banks and national banks; it does not apply to Wisconsin state savings banks or savings and loan associations. Federal thrifts already have unlimited interstate branching authority under federal law, and state chartered thrifts currently have the ability to branch in a group of regional Midwestern states.
This Financial Institutions Update is published to provide our friends and clients with current information that may affect their businesses. This information is not intended to serve as specific legal advice or as a solicitation for business.
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