BILL NUMBER: S9382
SPONSOR: SANDERS
 
TITLE OF BILL:
An act to amend chapter 3 of the laws of 1997 amending the banking law
and the insurance law relating to authorizing the banking board to
permit banks and trust companies to exercise the rights of national
banks, in relation to the effectiveness thereof; and to amend chapter
322 of the laws of 2007 amending the banking law relating to the power
of banks, private bankers, trust companies, savings banks, savings and
loan associations, credit unions and foreign banking corporations to
exercise the rights of national banks, federal savings associations,
federal credit unions and federal branches and agencies of foreign
banks, in relation to the effectiveness thereof
 
PURPOSE OR GENERAL IDEA OF BILL:
To extend, for an additional five years, the banking "wild card" law,
which provides an administrative mechanism to keep the state banking
charter viable and competitive with the federal banking charter.
 
SUMMARY OF SPECIFIC PROVISIONS:
The effective date provisions of Chapter 322 of 2007 and Chapter 3 of
the Laws of 1997 are amended to extend the sunset date from September
10, 2024 to September 10, 2029.
 
EXISTING LAW:
Under the "wild card" law (Section 12-a of the Banking Law), the Super-
intendent of Financial Services is authorized to permit state-chartered
banking organizations to exercise banking powers that are available to
corresponding federally-chartered institutions, but which are not
expressly authorized under the Banking Law.
 
JUSTIFICATION:.
Under the nation's dual banking system, banking institutions may choose
to operate under either a state or federal charter. Almost every state
has a banking "wild card" law which provides an administrative mechanism
to help maintain parity in regard to the powers of state banks and
national banks.
In general, a banking wild card law enables a state regulator to admin-
istratively authorize state banks to exercise the same powers as
national banks. A wild card law can provide a timely, flexible and effi-
cient mechanism for keeping a state's banking charter competitive,
attractive and viable in comparison with the federal charter.
In 1997, a banking wild card law was enacted in New York State to help
retain and promote the state banking charter and state banking system.
With this law, the State sought to reassure its state-chartered banking
institutions that it was committed and determined to keep the state
charter competitive with the federal charter.
With the rapid and continuing changes in the financial system, state-
chartered institutions were becoming increasingly concerned that they
would find themselves at a significant disadvantage. While federally-
chartered institutions were positioned to immediately take advantage of
any expanded powers and new opportunities granted at the federal level,
state institutions feared that lengthy delays and uncertainty at the
state level would place them at a significant disadvantage.
The wild card law is intended to help address these concerns by estab-
lishing an administrative process to enable New York State to quickly
respond to significant parity issues. New York's wild card law included
a sunset date, and the law has been extended several times since its
original enactment in 1997. This bill would extend the law for an addi-
tional five years.
 
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:
None to the State.
 
EFFECTIVE DATE:
Immediately.