(c) Limitation on out-of-State loans
(1) Limitation Regulations issued under subsection (a) of this section shall require that, beginning no earlier than 1 year after establishment or acquisition of an interstate branch or branches in a host State by an out-of-State bank, if the appropriate Federal banking agency for the out-of-State bank determines that the banks level of lending in the host State relative to the deposits from the host State (as reasonably determinable from available information including the agencys sampling of the banks loan files during an examination or such data as is otherwise available) is less than half the average of total loans in the host State relative to total deposits from the host State (as determinable from relevant sources) for all banks the home State of which is such State
(A) the appropriate Federal banking agency for the out-of-State bank shall review the loan portfolio of the bank and determine whether the bank is reasonably helping to meet the credit needs of the communities served by the bank in the host State; and
(B) if the agency determines that the out-of-State bank is not reasonably helping to meet those needs
(i) the agency may order that an interstate branch or branches of such bank in the host State be closed unless the bank provides reasonable assurances to the satisfaction of the appropriate Federal banking agency that the bank has an acceptable plan that will reasonably help to meet the credit needs of the communities served by the bank in the host State, and
(ii) the out-of-State bank may not open a new interstate branch in the host State unless the bank provides reasonable assurances to the satisfaction of the appropriate Federal banking agency that the bank will reasonably help to meet the credit needs of the community that the new branch will serve.
(2) Considerations In making a determination under paragraph (1)(A), the appropriate Federal banking agency shall consider
(A) whether the interstate branch or branches of the out-of-State bank were formerly part of a failed or failing depository institution;
(B) whether the interstate branch was acquired under circumstances where there was a low loan-to-deposit ratio because of the nature of the acquired institutions business or loan portfolio;
(C) whether the interstate branch or branches of the out-of-State bank have a higher concentration of commercial or credit card lending, trust services, or other specialized activities;
(D) the ratings received by the out-of-State bank under the Community Reinvestment Act of 1977 [
12 U.S.C.
2901 et seq.];
(E) economic conditions, including the level of loan demand, within the communities served by the interstate branch or branches of the out-of-State bank; and
(F) the safe and sound operation and condition of the out-of-State bank.
(3) Branch closing procedure
(A) Notice required
Before exercising any authority under paragraph (1)(B)(i), the appropriate Federal banking agency shall issue to the bank a notice of the agencys intention to close an interstate branch or branches and shall schedule a hearing.
(B) Hearing Section
1818 (h) of this title shall apply to any proceeding brought under this paragraph.
(e) Definitions For the purposes of this section, the following definitions shall apply:
(1) Appropriate Federal banking agency, bank, State, and State bank The terms appropriate Federal banking agency, bank, State, and State bank have the same meanings as in section
1813 of this title.
(2) Home State The term home State means
(A) in the case of a national bank, the State in which the main office of the bank is located; and
(B) in the case of a State bank, the State by which the bank is chartered.
(3) Host State
The term host State means a State in which a bank establishes a branch other than the home State of the bank.
(4) Interstate branch The term interstate branch means a branch established pursuant to this title
or any amendment made by this title
to any other provision of law and any branch of a bank controlled by an out-of-State bank holding company (as defined in section
1841 (o)(7) of this title).
(5) Out-of-State bank
The term out-of-State bank means, with respect to any State, a bank the home State of which is another State and, for purposes of this section, includes a foreign bank, the home State of which is another State.
