Section 14102 - General organizational powers(a) A Vermont financial institution shall have all of the powers enumerated in Title 11 or 11A, depending on the organizational form of the institution.(b) Unless otherwise prohibited or limited by part 1, 2, or 5 of this title, a Vermont financial institution has and may exercise all powers necessary or convenient to effect the purposes for which the financial institution is organized or to further the businesses in which the financial institution is or may be lawfully engaged. Such powers shall include:(1) establishing, acquiring, investing, or participating in or utilizing a service corporation;(2) engaging, directly or indirectly through an operating subsidiary, in closely related activities as defined in subdivision 11101(14) of this title; and(3) investing or participating in an entity that engages in closely related activities but is not an operating subsidiary, with the Commissioner's approval; provided, however, the Commissioner may require that closely related activities be conducted through a subsidiary whenever the Commissioner determines that a limitation on the Vermont financial institution's direct financial risk is prudent. A Vermont financial institution shall keep such records as may be required by the Commissioner relative to the activities permitted by this subsection. Service corporations and operating subsidiaries shall be subject to regulation and supervision under this title.(c) A Vermont financial institution may engage in electronic banking.(d) Any Vermont financial institution may amend its organizational documents to provide for the separation of its corporate franchises into separate departments according to the nature of its business. In that event, it shall equitably apportion its assets between those departments in such manner as the Commissioner shall approve and thereafter shall maintain a segregation of the assets and obligations of those departments. Depositors shall be notified of the segregation and of the department to which their deposits are assigned. In case of liquidation or the imposition of restrictions upon the payment of deposits, at any time more than six months after such notice, the depositors of each of the departments shall be entitled to receive payment of deposits out of the assets of the department to which their deposits have been assigned in priority to all depositors in the other department, and to creditors who become such after the segregation, except as those obligations to creditors are properly allocated to a department at the time the obligations are created. The assets of the trust department shall be devoted first to meeting the obligations of the financial institution to the beneficiaries of its trusts according to their respective rights.(e) A Vermont financial institution shall have the power to join the Federal Reserve System or any cooperative league or other entity organized for the purpose of protecting and promoting the welfare of financial institutions and their depositors and to comply with all conditions of membership. A Vermont financial institution that is a member of the Federal Reserve Bank is by this subsection vested with all powers conferred upon member banks of the Federal Reserve System by the terms of the Federal Reserve Act as fully and completely as if those powers were specifically enumerated and described in this subsection, and all those powers shall be exercised subject to all restrictions and limitations imposed by the Federal Reserve Act or by regulations of the Federal Reserve Board made pursuant to the Act. A member financial institution under this subsection shall continue to be subject to the supervision and examinations required by the laws of this State, except that the Federal Reserve Board and the Federal Deposit Insurance Corporation shall have the right, if deemed necessary, to make examinations. The authorities of this State having supervision over the financial institution may disclose to the Federal Reserve Board or to the Federal Deposit Insurance Corporation or to their duly appointed examiners all information in reference to the affairs of any financial institution that has become or desires to become a member.(f) Subject to the approval of the Commissioner, a Vermont financial institution may contract with another financial institution or financial institutions for branch or agency services or to provide those services to the customers of that financial institution or financial institutions. Notwithstanding the foregoing sentence, any Vermont financial institution subsidiary of a bank holding company may receive deposits, renew time deposits, close loans, service loans, and receive payments on loans and other obligations as an agent for an affiliate depository institution or contract to receive such services without such approval.
Amended by 2022 , No. 105, § 292, eff. 7/1/2022.Added 1999, No. 153 (Adj. Sess.), § 2, eff. 1/1/2001.