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23-51-145. Transactions with management and affiliates.
Arkansas Code — all titles (historical 2020) · legal_authorities
23-51-145. Transactions with management and affiliates.
(a) Without the prior approval of a disinterested majority of the board recorded in the minutes, or if a disinterested majority cannot be obtained the prior written approval of a majority of the disinterested directors and the Bank Commissioner, a state trust company may not directly or indirectly:
(1) Sell or lease an asset of the state trust company to an officer, director, or principal shareholder of the state trust company or an affiliate of the state trust company;
(2) Purchase or lease an asset in which an officer, director or principal shareholder of the state trust company or an affiliate of the state trust company has an interest; or
(3) Subject to § 23-51-128, extend credit to an officer, director, or principal shareholder of the state trust company or an affiliate of the state trust company.
(b) Notwithstanding subsection (a) of this section, a lease transaction described in subdivision (a)(2) of this section involving real property may not be consummated, renewed, or extended without the prior written approval of the commissioner. For purposes of this subsection only, an affiliate of the state trust company does not include a subsidiary of the state trust company.
(c) Subject to § 23-51-128, a state trust company may not directly or indirectly extend credit to an employee, officer, director or principal shareholder of the state trust company or an affiliate of the state trust company, unless the extension of credit:
(1) Is made on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions by the state trust company with persons who are not employees, officers, directors, principal shareholders, or affiliates of the sta
Source: Arkansas Code — historical release 78 (November 6, 2020) · 23-51-145
Stored review status: Historical 2020-11-06 source release; later amendments not reconciled; machine-extracted, not independently legally reviewed; source heading status: text_in_historical_source. A text match is a research starting point; applicability is not established.
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Stable record: arkansas_code:legal_authorities:23-51-145
Source file: gov.ar.code.title.23.odt
Pages: Not recorded – Not recorded
Passage SHA-256: cc654e4ca6619ed8e7eed19e35c854d746a0bb0a4fced4dcc002992ff933d4b6
Source location: content.xml paragraph 25829
Stored source content
23-51-145. Transactions with management and affiliates.
(a) Without the prior approval of a disinterested majority of the board recorded in the minutes, or if a disinterested majority cannot be obtained the prior written approval of a majority of the disinterested directors and the Bank Commissioner, a state trust company may not directly or indirectly:
(1) Sell or lease an asset of the state trust company to an officer, director, or principal shareholder of the state trust company or an affiliate of the state trust company;
(2) Purchase or lease an asset in which an officer, director or principal shareholder of the state trust company or an affiliate of the state trust company has an interest; or
(3) Subject to § 23-51-128, extend credit to an officer, director, or principal shareholder of the state trust company or an affiliate of the state trust company.
(b) Notwithstanding subsection (a) of this section, a lease transaction described in subdivision (a)(2) of this section involving real property may not be consummated, renewed, or extended without the prior written approval of the commissioner. For purposes of this subsection only, an affiliate of the state trust company does not include a subsidiary of the state trust company.
(c) Subject to § 23-51-128, a state trust company may not directly or indirectly extend credit to an employee, officer, director or principal shareholder of the state trust company or an affiliate of the state trust company, unless the extension of credit:
(1) Is made on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions by the state trust company with persons who are not employees, officers, directors, principal shareholders, or affiliates of the state trust company;
(2) Does not involve more than the normal risk of repayment or present other unfavorable features; and
(3) The state trust company follows credit underwriting procedures that are not less stringent than those applicable to comparable transactions by the state trust company with persons who are not employees, officers, directors, principal shareholders or affiliates of the state trust company.
(d) An officer or director of the state trust company who knowingly participates in or knowingly permits a violation of this section shall be guilty of a Class D felony.
(e) The commissioner may adopt rules to administer and carry out this section, including rules to establish limits, requirements, or exemptions other than those specified by this section for particular categories of transactions.
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Arkansas Code — all titles (historical 2020) · legal_authorities
23-51-128. Lending limits.
(a) A state trust company's total outstanding loans and extensions of credit to a person other than an insider may not exceed an amount equal to twenty percent (20%) of the state trust company's capital base.
(b) The aggregate loans and extensions of credit outstanding at any time to insiders of the state trust company may not exceed an amount equal to twenty percent (20%) of the state trust company's capital base. All covered transactions between an insider and a state trust company must be engaged in only on terms and under circumstances, including credit standards, that are substantially the same as those for comparable transactions with a non-insider.
(c) The Bank Commissioner may adopt rules to administer and carry out this section, including rules to establish limits, requirements, or exemptions other than those specified by this section for particular classes or categories of loans or extensions of credit, and establish collective lending and investment limits.
(d) The commissioner may determine whether a loan or extension of credit putatively made to a person will be attributed to another person for purposes of this section.
(e) A state trust company may not lend trust deposits, except that a trustee may make a loan to a beneficiary of the trust if the loan is expressly authorized or directed by the instrument or transaction establishing the trust.
(f) An officer, director, or employee of a state trust company who approves or participates in the approval of a loan with actual knowledge that the loan violates this section is jointly and severally liable to the state trust company for the lesser of the amount by which the loan exceeded applicable lending limits or the state trust company's actual loss and remains liable for t
Source: Arkansas Code — historical release 78 (November 6, 2020) · 23-51-128
Stored review status: Historical 2020-11-06 source release; later amendments not reconciled; machine-extracted, not independently legally reviewed; source heading status: text_in_historical_source. The source passage cites 23-51-128. This identifies an authority to review, not proof of applicability.