12 C.F.R. § 5.37 Investment in bank premises.
Title 12 - Banks and Banking
(a) Authority. 12 U.S.C. 29, 93a, and 371d. (b) Scope. This section sets forth the procedures governing OCC review and approval of applications by national banks to invest in bank premises or in certain bank premises related investments, loans, or indebtedness, as described in paragraph (d)(1)(i) of this section. (c) Definition—Bank premises for purposes of this section includes the following: (1) Premises that are owned and occupied (or to be occupied, if under construction) by the bank, its branches, or its consolidated subsidiaries; (2) Capitalized leases and leasehold improvements, vaults, and fixed machinery and equipment; (3) Remodeling costs to existing premises; (4) Real estate acquired and intended, in good faith, for use in future expansion; or (5) Parking facilities that are used by customers or employees of the bank, its branches, and its consolidated subsidiaries. (d) Procedure—(1) Application. (i) A national bank shall submit an application to the appropriate supervisory office to invest in bank premises, or in the stock, bonds, debentures, or other such obligations of any corporation holding the premises of the bank, or to make loans to or upon the security of the stock of such corporation, if the aggregate of all such investments and loans, together with the indebtedness incurred by any such corporation that is an affiliate of the bank, as defined in 12 U.S.C. 221a, will exceed the amount of the capital stock of the bank. (ii) The application must include: (A) A description of the bank's present investment in bank premises; (B) The investment in bank premises that the bank intends to make, and the business reason for making the investment; and (C) The amount by which the bank's aggregate investment will exceed the amount of the bank's capital stock. (2) Approval. An application for national bank investment in bank premises or in certain bank premises' related investments, loans or indebtedness, as described in paragraph (d)(1)(i) of this section, is deemed approved as of the 30th day after the filing is received by the OCC, unless the OCC notifies the bank prior to that date that the filing presents a significant supervisory, or compliance concern, or raises a significant legal or policy issue. An approval for a specified amount under this section remains valid up to that amount until the OCC notifies the bank otherwise. (3) Notice process. Notwithstanding paragraph (d)(1)(i) of this section, a bank that is rated 1 or 2 under the Uniform Financial Institutions Rating System (CAMELS) may make an aggregate investment in bank premises up to 150 percent of the bank's capital and surplus without the OCC's prior approval, provided that the bank is well capitalized as defined in 12 CFR part 6 and will continue to be well capitalized after the investment or loan is made. However, the bank shall notify the appropriate supervisory office in writing of the investment within 30 days after the investment or loan is made. The written notice must include a description of the bank's investment. (4) Exceptions to rules of general applicability. Sections 5.8, 5.10, and 5.11 do not apply to this section. However, if the OCC concludes that an application presents significant and novel policy, supervisory, or legal issues, the OCC may determine that any or all parts of §§5.8, 5.10, and 5.11 apply. [61 FR 60363, Nov. 27, 1996, as amended at 64 FR 60098, Nov. 4, 1999]
Title 12: Banks and Banking
PART 5—RULES, POLICIES, AND PROCEDURES FOR CORPORATE ACTIVITIES
Subpart C—Expansion of Activities
§ 5.37 Investment in bank premises.
