3 AAC 06.325. Application for conversion

(a) The chairperson shall apply to the department for permission to implement the proposed conversion plan. The application must include

(1) a completed FDIC new bank application using forms which may be obtained directly from FDIC;

(2) an analysis of why the proposed conversion is in the best interests of promoting and maintaining a sound and competitive banking system, the security of deposits and customers, the preservation of the liquid position of the converting association in general, and the preventing of injurious credit expansion and contractions in the state; and demonstrate how the converting association proposes to discharge the duties and conform to the restrictions upon banks under AS 06.15;

(3) a copy of the proposed amended articles of incorporation;

(4) a check or money order for $1,000, made payable to the State of Alaska, as a partial prepayment of investigation expenses incurred by the department in accordance with AS 06.01.010 ;

(5) other materials as required by the department.

(b) The department will conduct an investigation of the application and, if the department finds that the application is in order and that the provisions of AS 06.15 have been met, it will issue a public notice of the department's intent to approve the proposed conversion and to issue a certificate of authority for the conversion.

(c) If the department does not receive a request for hearing within the time specified under AS 06.01.030 (b), or determines after a hearing that the application is in order, the department will approve the application, file both copies of the originally signed amended articles of incorporation, issue a certificate of authority to convert, and forward it along with a copy of the amended articles to the chairperson of the former association. The certificate of authority to convert is effective immediately unless the certificate states a later effective date, which must be within 15 days after issuance of the certificate.

(d) Conversion of an association to a bank has the following effect:

(1) the association becomes a bank with the board of directors of the association becoming the board of trustees of the bank;

(2) the converting association ceases to exist;

(3) the bank has the rights, privileges, immunities and powers, and is subject to the duties and liabilities of a bank organized under AS 06.15; however, it may retain and service all accounts lawfully held by it as a association on the date of its conversion;

(4) all real, personal, and mixed property, all debts due, all choses in action, and every other interest in, possession of, and obligation due to the converting association are transferred to and vested in the bank;

(5) title to or interest in real property vested in the converting association is transferred to and vests in the bank;

(6) the bank is liable for the liabilities and obligations of the converting association incurred before conversion;

(7) a claim existing or action or proceeding pending by or against the converting association may be prosecuted as if the conversion had not taken place, or the bank may be substituted in its place;

(8) neither the rights of creditors nor liens upon the property of a converting association are impaired by the conversion;

(9) the statements set forth in the amended articles of incorporation which are required or permitted as articles of incorporation for banks organized under AS 06.15 are the original articles of incorporation of the bank into which the association has converted; and

(10) the net undivided profits of the converting association available for the payment of dividends immediately before the conversion, to the extent that the net undivided profits are not transferred to stated capital, remain available for the payment of dividends by the bank.

(e) The final amended articles of incorporation of the converting association must be filed with the department within 180 days of the department's approval of the application. The department will, in its discretion, grant an extension of the filing period upon written request to the department by the chairperson with a satisfactory explanation of the need for an extension.

History: Eff. 8/22/79, Register 71

Authority: AS 06.01.010

AS 06.01.030

AS 06.15.010

AS 06.15.300

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