Connecticut General Statutes 36a-216 – Powers in case of financial distress
(a) Whenever, in the opinion of the commissioner, general financial conditions are such that the public interest requires limitation on withdrawal of funds from Connecticut banks or Connecticut credit unions, or the assets of any Connecticut bank or Connecticut credit union are in such nonliquid condition that the interests of the depositors, share account holders or clients may be jeopardized, the commissioner may: (1) Order any one or more of such banks or credit unions to restrict all or any part of their business and limit or postpone for any length of time the payment of any amount or proportion of the deposits in any of the departments of such banks or credit unions as the commissioner deems necessary or expedient. The commissioner may regulate as to time and amount further payments as the interest of the public, of any such bank or credit union or of the depositors, share account holders, clients or creditors thereof may require. Any order made by the commissioner under this subdivision may be amended, extended or revoked in whole or in part, whenever in the commissioner’s judgment circumstances warrant or require; (2) authorize any such banks or credit unions to receive new deposits or share account payments which shall be designated as new deposits or share account payments, and shall be segregated from all other deposits or share account payments. Such new deposits or share account payments shall be invested only in assets approved by the commissioner as being sufficiently liquid to be available when needed to meet any demands on account of such new deposits or share account payments. Such assets shall not be merged with other assets but shall be held in trust for the security and payment of such new deposits or share account payments, except that income from such assets may, to the extent authorized by the commissioner, be used by the banks or credit unions for other proper purposes of such banks or credit unions; and the withdrawal of such new deposits or share account payments shall not be subjected in any respect to restriction or limitation under this section; (3) adopt such regulations, in accordance with chapter 54, as the commissioner deems advisable for the protection of any such bank or credit union or the depositors, share account holders, clients or creditors thereof. Any person who violates any provision of such regulations shall be fined not more than one thousand dollars or imprisoned not more than one year, or both.
Terms Used In Connecticut General Statutes 36a-216
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Bank: means a Connecticut bank or a federal bank. See Connecticut General Statutes 36a-2
- banks: shall include all incorporated banks. See Connecticut General Statutes 1-1
- Commissioner: means the Banking Commissioner and, with respect to any function of the commissioner, includes any person authorized or designated by the commissioner to carry out that function. See Connecticut General Statutes 36a-2
- Connecticut bank: means a bank and trust company, savings bank or savings and loan association chartered or organized under the laws of this state. See Connecticut General Statutes 36a-2
- Connecticut credit union: means a cooperative, nonprofit financial institution that (A) is organized under chapter 667 and the membership of which is limited as provided in section 36a-438a, (B) operates for the benefit and general welfare of its members with the earnings, benefits or services offered being distributed to or retained for its members, and (C) is governed by a volunteer board of directors elected by and from its membership. See Connecticut General Statutes 36a-2
- Person: means an individual, company, including a company described in subparagraphs (A) and (B) of subdivision (12) of this section, or any other legal entity, including a federal, state or municipal government or agency or any political subdivision thereof. See Connecticut General Statutes 36a-2
(b) In determining action to be taken under this section, the commissioner may place such fair value on the assets of any such bank or credit union as the commissioner deems advisable under the conditions prevailing and circumstances relating thereto.
(c) Any costs and expenses incurred by the commissioner in the exercise of the powers given to the commissioner under this section shall be assessed by the commissioner against any bank or credit union in connection with which such costs and expenses were incurred and, when so assessed, shall be paid by such bank or credit union in addition to the annual assessment of expenses of the Department of Banking provided under section 36a-65.
(d) Nothing in this section shall be construed to give the commissioner authority to establish a maximum rate of dividends or interest on deposits or share accounts applying to a type of Connecticut bank or Connecticut credit union as a group.