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e-CFR
Data is current as of April 23, 2008

Title 12:
Banks and Banking

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PART 545—FEDERAL SAVINGS ASSOCIATIONS—OPERATIONS

Section Contents
§ 545.1   General
authority.
§ 545.2   Federal
preemption.
§ 545.16   Public
deposits, depositaries, and fiscal agents.
§ 545.17   Funds
transfer services.
§ 545.91   Home
office.
§ 545.92   Branch
offices.
§ 545.93   Application
and notice requirements for branch and home offices.
§ 545.95   What
processing procedures apply to my home or branch office application or
notice?
§ 545.96   Agency
office.
§ 545.101   Fiscal
agency.
§ 545.121   Indemnification
of directors, officers and employees.

Authority:   12 U.S.C. 1462a, 1463,
1464, 1828.

Source:   54 FR 49492, Nov. 30, 1989,
unless otherwise noted.

§ 545.1   General authority.

top

A Federal savings association may exercise all authority granted it by
the Home Owners' Loan Act of 1933 (“Act”), 12 U.S.C. 1464, as amended, and
its charter and bylaws, whether or not implemented specifically by Office
regulations, subject to the limitations and interpretations contained in
this part.

§ 545.2   Federal preemption.

top

The regulations in this part 545 are promulgated pursuant to the
plenary and exclusive authority of the Office to regulate all aspects of
the operations of Federal savings associations, as set forth in section
5(a) of the Act. This exercise of the Office's authority is preemptive of
any state law purporting to address the subject of the operations of a
Federal savings association.

§ 545.16   Public deposits, depositaries, and
fiscal agents.

top

(a) Definitions. As used in this section—

(1) Moneys includes monies and has the meaning it has in
applicable state law;

(2) State law includes actions by a governmental body which has
a charter adopted under the constitution of the state with provisions
respecting deposits of public money of that body;

(3) Surety means surety under real and/or personal suretyship,
and includes guarantor; and

(4) Terms in paragraph (b) of this section have the meanings they have
under applicable state law.

(b) Authority to act as surety for public deposits. (1) A
Federal savings association that is a deposit association may give bond or
security for deposit in it of public moneys or investment in it by a
governmental unit if required to do so by state law, either as an
alternative condition or otherwise, regardless of the amount required. Any
bond or security may be given and any substitution or increase thereof may
be made under this section at any time.

(2) If state law requires as a condition of such deposit or investment
that the Federal savings association or its bond or security, or any
combination thereof, be surety for or with respect to other deposits or
instruments, whether of that depositor or investor or of any other(s), and
whether in the Federal savings association or in any other institution(s)
having, when the investments or deposits were made, insurance by the
Federal Deposit Insurance Corporation, the same shall become, or if the
state law is self-executing shall be, such surety.

(c) Depositaries and fiscal agents. Subject to regulation of the
United States Treasury Department, a Federal savings association may serve
as a depositary for Federal taxes, as a Treasury tax and loan depositary,
or as a depositary of public money and fiscal agent of the Government or
any other instrumentality thereof when designated for that purpose by such
instrumentality and approved by the Office, and may satisfy any
requirement in connection therewith, including maintaining accounts
described in §§561.33, 561.52, 561.53, and 561.54 of this chapter;
pledging collateral; and performing the services outlined in 31 CFR
202.3(b) or any section that supersedes or amends §202.3(b).

§ 545.17   Funds transfer services.

top

A Federal savings association is authorized to transfer, with or
without fee, its customers' funds from any account (including a line of
credit) of the customer at the Federal savings association or at another
financial intermediary to third parties or other accounts of the customer
on the customer's order or authorization by any mechanism or device,
including cashier's checks, conforming with applicable laws and
established commercial practices.

§ 545.91   Home office.

top

(a) All operations of a Federal savings association (“you”) are subject
to direction from the home office.

(b) You must notify the appropriate OTS Regional Office if the
permanent address of your home office changes, unless you have submitted
an application or notice regarding the change under §§545.93 and 545.95 of
this chapter.

[69 FR 68248, Nov. 24, 2004]

§ 545.92   Branch offices.

top

(a) Definition. A branch office of a Federal savings association
(“you”) is any office other than your home office, agency office,
administrative office, data processing office, or an electronic means or
facility under part 555 of this chapter.

(b) Branching. Subject to the application and notice
requirements at §§545.93 and 545.95 of this chapter, you may branch in any
State or States of the United States and its territories unless the
location would violate:

(1) Section 5(r) of the HOLA (12 U.S.C. 1464(r));

(2) Section 10(e)(3) of the HOLA (12 U.S.C. 1467a(e)(3)); or

(3) Section 13(k)(4) of the FDIA (12 U.S.C. 1823(k)(4)).

(c) Preemption. This exercise of OTS authority is preemptive of
any State law purporting to address the subject of branching by a Federal
savings association.

[69 FR 68248, Nov. 24, 2004]

§ 545.93   Application and notice requirements for
branch and home offices.

top

(a) Application and notice requirements. A Federal savings
association (“you”) must file an application or notice and receive OTS
approval or non-objection under §545.95 before you change the permanent
location of, or establish a new, home or branch office, except as provided
in this section.

(b) Exceptions. You are not required to submit an application or
notice and receive OTS approval or non-objection under §545.95 under the
following circumstances:

(1) Drive-in or pedestrian offices. You may establish a drive-in
or pedestrian office that is located within 500 feet of a public entrance
to your existing home or branch office, provided the functions performed
at the office are limited to functions that are ordinarily performed at a
teller window.

(2) Short-distance relocation. You may change the permanent
location of an existing home or branch office to a site that is within the
market area and short-distance location area of the existing home or
branch office. The short-distance relocation area of an existing office is
the area that is within:

(i) A 1000-foot radius of an existing office that is within a Principal
City in a Metropolitan Statistical Area (MSA) designated by the U.S.
Department of Commerce;

(ii) A one-mile radius of an existing office that is within an MSA, but
is not within a Principal City; or

(iii) A two-mile radius of an existing office that is not in an
MSA.

(3) Highly-rated Federal savings associations. You may change
the permanent location of, or establish a new, branch or home office if
you meet all of the following requirements:

(i) You are eligible for expedited treatment under §516.5 of this
chapter. For the purposes of that section, you must meet the capital
requirements under part 567 of this chapter before and immediately after
you change the location of your home or branch office or establish a new
branch office.

(ii) You published a notice of your intent to change the location of
your home or branch office or establish a new branch office. To satisfy
this publication requirement, you must follow the procedures in subpart B
of part 516 of this chapter except that:

(A) Under §516.55(d) and (e) of this chapter, your public notice must
state that the public may submit comments to you and to the appropriate
OTS office(s), and must provide addresses for you and for the appropriate
OTS office(s) where the public may submit comments;

(B) Section 516.55(g) of this chapter, which addresses public
inspections of filings with OTS, does not apply; and

(C) Under §516.60 of this chapter, you must publish the public notice
at least 35 days before you take the proposed action. If you publish a
public notice more than 12 months before you take the proposed action, the
publication is invalid.

(iii) If you intend to change the location of an existing office, you
posted a notice of your intent in a prominent location in the existing
office to be relocated. You must post the notice for 30 days from the date
of publication of the initial public notice described in paragraph
(b)(3)(ii) of this section.

(iv)(A) No person files a comment opposing the proposed action within
30 days after the date of the publication of the proposed notice, or (B) A
person files a comment opposing the proposed action and OTS determines
that the comment raises issues that are not relevant to the approval
standards in §545.95(b) of this chapter or that OTS action in response to
the comment is not required.

(4) Re-designations of home and branch offices. You may
re-designate an existing branch office as a home office at the same time
that you re-designate your existing home office as a branch office.

(c) Section 5(m) of the HOLA. If you are incorporated under the
laws of, organized in, or do business in the District of Columbia and you
satisfy the requirements of paragraph (b) of this section, the Director of
OTS has approved your home or branch office changes under section 5(m) of
the HOLA.

(d) Maintenance of branch and home office following conversion,
consolidation, purchase of bulk assets, merger, or purchase from receiver.
An existing savings association that converts to a federal savings
association may maintain an existing office and a federal savings
association may maintain any office acquired through consolidation,
purchase of bulk assets, merger or purchase from the receiver of an
association, except to the extent that the approval of the conversion,
consolidation, merger, or purchase specifies otherwise.

(e) Prohibition. You may not file an application or notice (or
utilize any exception described in paragraph (b) of this section) to
establish a branch office, if you filed an application to merge or
otherwise surrender your charter and the application has been pending for
less than six months.

[69 FR 68248, Nov. 24, 2004, as amended at 70 FR 51586, Aug. 31,
2005]

§ 545.95   What processing procedures apply to my
home or branch office application or notice?

top

(a) Processing procedures. Applications and notices under
§545.93 are subject to expedited or standard treatment under the
application processing procedures at part 516 of this chapter.

(1) Publication and posting requirements. (i) You must publish a
public notice of your application or notice in accordance with the
procedures in subpart B of part 516 of this chapter. Promptly after
publication, you must transmit copies of the public notice and the
publisher's affidavit to OTS.

(ii) If you propose to change the location of an existing office, you
must also post a notice of the application in a prominent location in the
office to be relocated. You must post the notice for 30 days from the date
of publication of the initial public notice.

(2) Comment procedures. Commenters may submit comments on your
application or notice in accordance with the procedures in subpart C of
part 516 of this chapter.

(3) Meeting procedures. OTS may arrange a meeting in accordance
with the procedures in subpart D of part 516 of this chapter.

(4) OTS Review. OTS will process your application or notice in
accordance with the procedures in subpart E of part 516 of this chapter.
The applicable review period for applications filed under standard
treatment is 30 days rather than the time period specified at §516.270(a)
of this chapter.

(b) Approval standards. (1) OTS will approve an application (or
not object to a notice), if your overall policies, condition, and
operations afford no basis for supervisory objection.

(i) You should meet or exceed minimum capital requirements under part
567 of this chapter and should be at least adequately capitalized as
described in §565.4(b)(2) of this chapter, before and immediately after
the proposed action. If you are undercapitalized as described in
§565.4(b)(3), OTS will deny your application (or disapprove your notice),
unless the proposed action is otherwise permitted under section 38(e)(4)
of the FDIA.

(ii) OTS will evaluate your record of helping to meet the credit needs
of your entire community, including low- and moderate-income
neighborhoods, under part 563e of this chapter. OTS may:

(A) Deny your application or disapprove your notice based upon this
evaluation; or

(B) Impose a condition to the approval of your application (or
non-objection to your notice) requiring you to improve specific practices
and/or aspects of your performance under part 563e of this chapter. In
most cases, a commitment to improve will not be sufficient to overcome a
seriously deficient record.

(iii) OTS will review the application or notice under the National
Environmental Policy Act (42 U.S.C. 3421 et seq. ) and the National
Historic Preservation Act (16 U.S.C. 470).

(2) In reviewing your application and notice, OTS may consider
information available from any source, including any comments submitted by
interested parties or views expressed by interested parties at meetings
with OTS.

(3) OTS may approve an amendment to your charter in connection with a
home office relocation under this section.

(c) Expiration of OTS approval. (1) You must open or relocate
your office within twelve months of OTS approval of your application (or
the date of OTS non-objection to your notice), unless OTS prescribes
another time period. OTS may extend the time period if it determines that
you are making a good-faith effort to promptly open or relocate the
proposed office.

(2) If you do not open or relocate the proposed office within this time
period, you must comply with the application and notice requirements of
this section before you may open or relocate the proposed office.

[69 FR 68249, Nov. 24, 2004, as amended at 70 FR 51586, Aug. 31,
2005]

§ 545.96   Agency office.

top

(a) General. A Federal savings association may establish or
maintain an agency office to engage in one or more of the following
activities: (1) Servicing, originating, or approving loans and contracts;
(2) managing or selling real estate owned by the Federal savings
association; and (3) conducting fiduciary activities or activities
ancillary to the association's fiduciary business in compliance with
subpart A of part 550 of this chapter.

(b) Additional services. A Federal savings association may
request, and OTS may approve, any service not listed in paragraph (a) of
this section, except for payment on savings accounts.

(c) Records. A Federal savings association must maintain records
of all business it transacts at an agency office. It must maintain these
records at the agency office, and must transmit copies to a home or branch
office.

[69 FR 68249, Nov. 24, 2004]

§ 545.101   Fiscal agency.

top

A Federal savings association designated fiscal agent by the Secretary
of the Treasury or with Office approval by another instrumentality of the
United States, shall, as such, perform such reasonable duties and exercise
only such powers and privileges as the Secretary of the Treasury or such
instrumentality may prescribe.

§ 545.121   Indemnification of directors, officers
and employees.

top

A Federal savings association shall indemnify its directors, officers,
and employees in accordance with the following requirements:

(a) Definitions and rules of construction. (1) Definitions for
purposes of this section.

(i) Action. The term “action” means any judicial or
administrative proceeding, or threatened proceeding, whether civil,
criminal, or otherwise, including any appeal or other proceeding for
review;

(ii) Court. The term “court” includes, without limitation, any
court to which or in which any appeal or any proceeding for review is
brought.

(iii) Final judgment. The term “final judgment” means a
judgment, decree, or order which is not appealable or as to which the
period for appeal has expired with no appeal taken.

(iv) Settlement. The term “settlement” includes entry of a
judgment by consent or confession or a plea of guilty or nolo
contendere.

(2) References in this section to any individual or other person,
including any association, shall include legal representatives,
successors, and assigns thereof.

(b) General. Subject to paragraphs (c) and (g) of this section,
a savings association shall indemnify any person against whom an action is
brought or threatened because that person is or was a director, officer,
or employee of the association, for:

(1) Any amount for which that person becomes liable under a judgment if
such action; and

(2) Reasonable costs and expenses, including reasonable attorney's
fees, actually paid or incurred by that person in defending or settling
such action, or in enforcing his or her rights under this section if he or
she attains a favorable judgment in such enforcement action.

(c) Requirements. Indemnification shall be made to such period
under paragraph (b) of this section only if:

(1) Final judgment on the merits is in his or her favor; or

(2) In case of:

(i) Settlement,

(ii) Final judgment against him or her, or

(iii) Final judgment in his or her favor, other than on the merits, if
a majority of the disinterested directors of the savings association
determine that he or she was acting in good faith within the scope of his
or her employment or authority as he or she could reasonably have
perceived it under the circumstances and for a purpose he or she could
reasonably have believed under the circumstances was in the best interests
of the savings association or its members.

However, no indemnification shall be made unless the association gives
the Office at least 60 days' notice of its intention to make such
indemnification. Such notice shall state the facts on which the action
arose, the terms of any settlement, and any disposition of the action by a
court. Such notice, a copy thereof, and a certified copy of the resolution
containing the required determination by the board of directors shall be
sent to the Regional Director, who shall promptly acknowledge receipt
thereof. The notice period shall run from the date of such receipt. No
such indemnification shall be made if the OTS advises the association in
writing, within such notice period, of his or her objection thereto.

(d) Insurance. A savings association may obtain insurance to
protect it and its directors, officers, and employees from potential
losses arising from claims against any of them for alleged wrongful acts,
or wrongful acts, committed in their capacity as directors, officers, or
employees. However, no savings association may obtain insurance which
provides for payment of losses of any person incurred as a consequence of
his or her willful or criminal misconduct.

(e) Payment of expenses. If a majority of the directors of a
savings association concludes that, in connection with an action, any
person ultimately may become entitled to indemnification under this
section, the directors may authorize payment of reasonable costs and
expenses, including reasonable attorneys' fees, arising from the defense
or settlement of such action. Nothing in this paragraph (e) shall prevent
the directors of a savings association from imposing such conditions on a
payment of expenses as they deem warranted and in the interests of the
savings association. Before making advance payment of expenses under this
paragraph (e), the savings association shall obtain an agreement that the
savings association will be repaid if the person on whose behalf payment
is made is later determined not to be entitled to such
indemnification.

(f) Exclusiveness of provisions. No savings association shall
indemnify any person referred to in paragraph (b) of this section or
obtain insurance referred to in paragraph (d) of the section other than in
accordance with this section. However, an association which has a bylaw in
effect relating to indemnification of its personnel shall be governed
solely by that bylaw, except that its authority to obtain insurance shall
be governed by paragraph (d) of this section.

(g) The indemnification provided for in paragraph (b) of this section
is subject to and qualified by 12 U.S.C. 1821(k).

[54 FR 49492, Nov. 30, 1989, as amended at 56 FR 59866, Nov. 26, 1991;
60 FR 66717, Dec. 26, 1995]

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