IC 28-1-3.1
Chapter 3.1. Liquidation of Financial Institutions
IC 28-1-3.1-1 Definitions
Sec. 1. (a) The definitions set forth in this section apply
throughout this chapter.
(b) "Federal deposit insurance agency" means an agency or
instrumentality of the United States that insures to any extent the
deposits of a financial institution, including the Federal Deposit
Insurance Corporation or the National Credit Union Administration.
(c) "Insolvent" means a financial institution that:
(1) is incapable of meeting the demands of creditors or
depositors on a timely basis; or
(2) has liabilities in excess of the total value of its assets as
determined by the department.
(d) "Receiver" means a:
(1) federal deposit insurance agency;
(2) private deposit insurer of credit unions; or
(3) designated agent of the department.
(e) "Receivership court" means the court that the department has
filed the notice of possession with, under this chapter. As added by P.L.141-1984, SEC.2. Amended by P.L.8-1991, SEC.10;
P.L.262-1995, SEC.3.
IC 28-1-3.1-2 Authority of department to take possession of business and
property; conditions; duties of department
Sec. 2. (a) The department may take possession of the business
and property of any financial institution except a consumer finance
institution licensed to make supervised or regulated loans under
IC 24-4.5, whenever it appears to the department that the financial
institution:
(1) is insolvent or in imminent danger of insolvency;
(2) is in an unsafe or unsound condition;
(3) has refused to pay its deposits or obligations in accordance
with the terms under which those deposits or obligations were
incurred;
(4) has refused to submit its records and affairs for inspection
or examination by the department or federal authorities;
(5) has violated any court order, statute, rule, or regulation of
the department or its articles of incorporation and that
continued control of its own affairs threatens injury to the
public, the financial community, its depositors, or other
creditors;
(6) requests through its board of directors that the department
take possession for the benefit of depositors, other creditors,
shareholders, or other persons;
(7) has an impairment of its capital (the capital of a bank or
trust company shall, for the purpose of this subdivision, be
considered to be unimpaired so long as the sound value of its
assets over and above its liabilities, exclusive of liabilities for
capital notes, debentures, and capital stock, as determined by
the department, equals or exceeds the minimum capital or
capital stock required by the department for a bank or trust
company);
(8) has neglected or refused, for a period of thirty (30) days, to
comply with the terms of a duly issued order of the department,
essential to preserve the solvency of the financial institution;
(9) has failed to pay the fees charged by the department under
IC 28-11-3-5 after due notice of the amount of the fee has been
given;
(10) has breached a fiduciary duty under IC 30-4-3-6; or
(11) has violated IC 30-4-3-7 in a way that has caused or may
cause harm to fiduciary accounts.
(b) When the department makes a determination to take
possession of the business and property of a financial institution
under subsection (a), the department shall:
(1) make a finding to that effect and enter that finding on the
records of the proceedings of the department; and
(2) cause a certified copy of the finding to be served on the
president or other executive officer actively in charge of the
financial institution and demand possession of the business,
property, and records of the financial institution from the
officer. The financial institution shall immediately surrender the
possession to the department.
(c) The department or its receiver is not required to become the
owner of any property to fulfill the liquidation requirements of this
chapter. As added by P.L.141-1984, SEC.2. Amended by P.L.33-1991, SEC.9;
P.L.262-1995, SEC.4.
IC 28-1-3.1-3 Holding business and property until liquidation of affairs
Sec. 3. (a) When the department has taken possession of the
business and property of a financial institution under the provisions
of section 2 of this chapter, the department shall hold possession of
the business and property until the affairs of the institution have been
finally liquidated as provided in this chapter, unless the financial
institution has undertaken the voluntary liquidation of its affairs
under IC 28-1-9.
(b) If a corporate fiduciary is to be liquidated, the department may
appoint an agent from within or outside the department to
temporarily conduct the affairs of the corporate fiduciary until a
receiver is appointed. The agent may be required to give bond and
shall be paid reasonable compensation by the corporate fiduciary
being liquidated. As added by P.L.141-1984, SEC.2. Amended by P.L.262-1995,
SEC.5. IC 28-1-3.1-4 Notice; entry of cause; hearing; record; rights and liabilities of
persons interested; Federal Deposit Insurance Corporation as
receiver
Sec. 4. (a) Immediately upon the taking possession of the business
and property of any financial institution under section 2 of this
chapter, the department shall give notice by:
(1) posting the notice at the main entrance of the principal
office of the financial institution;
(2) causing the notice to be served upon the president or other
executive officer actively in charge of the business of the
financial institution; and
(3) filing the notice in the office of the circuit court in the
county where the principal office of the financial institution is
located.
(b) Upon the filing of the notice under subsection (a), the clerk
shall:
(1) note the filing of the notice upon the records of the
receivership court; and
(2) enter the cause as a civil action upon the dockets of the
court under the name and style of "In the matter of the
liquidation of ___________" (inserting the name of the
financial institution).
(c) The receivership court may hear and determine all issues and
matters pertaining to or connected with the liquidation of the
financial institution, including:
(1) the amount of the compensation and necessary expenses of
any special representative, assistant, accountant, agent, or
attorney employed by the department, or the receiver appointed
by the department, as set forth in this chapter; and
(2) all papers and pleadings pertaining to the liquidation
proceedings.
(d) All entries, orders, judgments, and decrees of the receivership
court in connection with the liquidation proceedings shall be filed
and entered of record in the cause of action.
(e) The rights and liabilities of a financial institution and of its
creditors, depositors, shareholders, and all other persons interested
in its estate shall, unless otherwise directed by the court, be fixed as
of the date of the filing of the notice of possession with the
receivership court. In the case of mutual debts or mutual credits of
equal priority between the financial institution and another person,
the credits and debts shall be set off and the balance only shall be
allowed or paid. The right to set off shall be determined as of the
date of the filing of the notice of possession of the financial
institution under subsection (a).
(f) Notwithstanding this section, if the Federal Deposit Insurance
Corporation is appointed receiver of a financial institution,
subsections (a)(3), (b), (c), and (d) do not apply, and applicable
federal law governs the receivership. As added by P.L.141-1984, SEC.2. Amended by P.L.35-2010,
SEC.99.
IC 28-1-3.1-5 Receiver; appointment; vesting of title to all assets and right to
terminate affairs of institution; liens or claims against property
Sec. 5. (a) The department may appoint the receiver of the closed
financial institution. Unless the receiver is the Federal Deposit
Insurance Corporation, the department, upon acceptance of the
appointment of a receiver, shall make immediate application to the
receivership court for confirmation of the receiver. The receivership
court shall approve the department's application if it finds that to do
so would be in the public interest. The application may be acted on
by the receivership court without any notice except that provided in
section 4 of this chapter. The receiver shall give a bond the director
considers appropriate. However, a federal deposit insurance agency
shall not be required to post any bond. If the receiver is not a federal
deposit insurance agency, the director may agree to reasonable
compensation for the receiver.
(b) Upon appointment as receiver, title to all assets of the
financial institution vest in the receiver without the execution of any
instruments of conveyance, assignment, transfer, or endorsement. If
no other receiver is appointed as provided in this chapter, the
department shall act as receiver and has all of the powers and duties
of a receiver as provided in this chapter.
(c) Except as otherwise provided, the sole and exclusive right to
liquidate and terminate the affairs of any financial institution is
vested in the receiver appointed under this section, and except as
otherwise provided by law, no other receiver, assignee, trustee, or
liquidating agent shall be appointed by any court or any other person.
(d) After the department has taken possession of the business and
property for any financial institution, no suit, action, or other
proceeding at law or in equity shall be commenced or prosecuted
against the financial institution upon any debt, obligation, claim, or
demand.
(e) No person, firm, limited liability company, corporation, or
other entity holding any of the property or credits of the financial
institution shall have any lien or charge against the property or
credits for any payment, advance, or clearance made after the
department has taken possession. A lien shall not attach to any of the
assets or property of the financial institution by reason of the entry
of any judgment recovered against the institution after the
department has taken possession of its business and property and
while the possession continues.
(f) A receiver appointed to liquidate a corporate fiduciary must
have sufficient experience in fiduciary matters. As added by P.L.141-1984, SEC.2. Amended by P.L.8-1993,
SEC.438; P.L.262-1995, SEC.6; P.L.35-2010, SEC.100.
IC 28-1-3.1-6 Receiver; authority
Sec. 6. The receiver of a closed financial institution may do the
following:
(1) Take possession of all books, records, and assets of the
financial institution.
(2) Collect all debts, claims, and judgments belonging to the
financial institution and do such other acts as are necessary to
preserve and liquidate its assets.
(3) Execute in the name of the financial institution any
instrument necessary or proper to effectuate its powers or
perform its duties as receiver.
(4) Initiate, pursue, and defend litigation involving any right,
claim, interest, or liability of the financial institution.
(5) Exercise any and all fiduciary functions of the financial
institution as of the date of appointment as receiver.
(6) Borrow money as necessary in the liquidation of the
financial institution and secure the borrowings by the pledge or
mortgage of assets.
(7) Abandon or convey title to any holder of a mortgage,
security deed, security interest, or lien against property in which
the financial institution has an interest whenever the receiver
determines that to continue to claim that interest is burdensome
and of no advantage to the financial institution, its depositors,
creditors, or shareholders.
(8) Subject to the approval of the receivership court:
(A) sell any and all real and personal property to
compromise any debt, claim, or judgment due to the
financial institution and discontinue any action or other
proceeding pending; or
(B) pay off all mortgages, securities deeds, security
agreements, and liens upon any real or personal property
belonging to the financial institution and purchase at a
judicial sale or at a sale authorized by court order, any real
or personal property in order to protect the financial
institution's equity in that property.
(9) If, at the time of liquidation, a closed financial institution
holds property in trust for an individual or a corporation under
or by virtue of a trust instrument, the administration of the
property must be handled in the manner set forth in IC 28-1-9-7.
Notwithstanding this section, when the Federal Deposit Insurance
Corporation is appointed receiver of a financial institution,
subdivision (8) does not apply. As added by P.L.141-1984, SEC.2. Amended by P.L.42-1993,
SEC.23; P.L.262-1995, SEC.7; P.L.35-2010, SEC.101.
IC 28-1-3.1-7 Receiver's authority to sell assets; borrowing of money for deposit
liabilities
Sec. 7. The receiver may, with ex parte approval of the
receivership court, sell all or any part of the financial institution's
assets to another state or federally chartered financial institution or
to a federal deposit insurance agency acting in its corporate capacity.
The Federal Deposit Insurance Corporation is not required to seek ex
parte approval of the receivership court. The receiver may also
borrow from a federal deposit insurance agency any amount
necessary to facilitate the assumption of deposit liabilities by a newly
chartered or existing state or federally chartered financial institution,
assigning any part or all of the assets of the financial institution as
security for the loan. As added by P.L.141-1984, SEC.2. Amended by P.L.35-2010,
SEC.102.
IC 28-1-3.1-8 Claims; presentation; notice; rejection
Sec. 8. (a) All parties having claims against the closed financial
institution shall present their claims supported by proof to the
receiver within one hundred eighty (180) days after the department
has taken possession.
(b) The receiver shall cause notice of the claims procedure
prescribed by this section to be:
(1) published once a week for twelve (12) consecutive weeks in
a newspaper of general circulation published in the county in
which the receivership court is located; and
(2) mailed to each person whose name appears as a creditor
upon books of the financial institution at the person's last
address of record.
(c) Within one hundred eighty (180) days following receipt of
claim, the receiver shall notify in writing any claimant whose claim
has been rejected. Notice is effective when mailed. Any claimant
whose claim has been rejected by the receiver may petition the
receivership court for a hearing on the claim within sixty (60) days
from the date the claim is rejected.
(d) If the Federal Deposit Insurance Corporation is the receiver,
compliance with this section is not required. As added by P.L.141-1984, SEC.2. Amended by P.L.35-2010,
SEC.103.
IC 28-1-3.1-9 Late claims
Sec. 9. Any claims filed after the one hundred eighty (180) day
claim period prescribed by section 8 of this chapter and subsequently
accepted by the receiver or allowed by the receivership court shall be
entitled to share in the distribution of assets only to the extent of the
undistributed assets in the hands of the receiver on the date the
claims are accepted or allowed. If the Federal Deposit Insurance
Corporation is the receiver, compliance with this section is not
required. As added by P.L.141-1984, SEC.2. Amended by P.L.35-2010,
SEC.104. IC 28-1-3.1-10
Repealed
(Repealed by P.L.42-1993, SEC.103.)
IC 28-1-3.1-10.1 Payment of claims; order
Sec. 10.1. (a) All claims against the financial institution that are
proved to the satisfaction of the receiver or approved by the
receivership court shall be paid in the following order:
(1) Claims of persons referred to in IC 28-1-12-6 as having
preference and priority.
(2) Administration expenses of the liquidation, including the
following:
(A) Court costs.
(B) Compensation and actual expenses incurred by the
department or the receiver in order to facilitate the
liquidation.
(C) Compensation of each regular officer or employee of the
receiver for the time actually devoted by the officer or
employee to the liquidation of the financial institution at an
amount not to exceed the compensation paid to the officer or
employee for the performance of the regular duties of the
officer or employee.
(D) Actual expenses of each regular officer or employee of
the receiver that are necessarily incurred in the performance
of the duties of the officer or employee in the liquidation.
(E) Compensation and expenses of any special
representative, assistant, accountant, agent, or attorney
employed by the receiver.
(F) The reasonable general overhead expenses that are
incurred by the department or the receiver in the liquidation
of the affairs of the financial institution.
(3) Claims given priority under other provisions of state or
federal law.
(4) Deposit obligations.
(5) Other general liabilities.
(6) Debt subordinated to the claims of general creditors.
(7) Equity capital securities.
(b) Interest may not be paid on any claim until the full principal
amount of every claim within the same class has been paid.
(c) If the Federal Deposit Insurance Corporation is the receiver,
compliance with this section is not required. As added by P.L.262-1995, SEC.8. Amended by P.L.35-2010,
SEC.105.
IC 28-1-3.1-11 Rejection of executory contracts and leases
Sec. 11. (a) Within one hundred eighty (180) days of the date that
the department has taken possession, the receiver may, at his
election, reject:
(1) any executory contract to which the closed financial
institution is a party without any further liability to the closed
financial institution or the receiver; or
(2) any obligation of the financial institution as a lessee of real
or personal property.
The receiver's election to reject a lease shall create no claim for rent
other than rent accrued to the date of termination or for actual
damages, if any, for the termination not to exceed the equivalent of
payment of rent for six (6) months.
(b) If the Federal Deposit Insurance Corporation is the receiver,
compliance with this section is not required. As added by P.L.141-1984, SEC.2. Amended by P.L.35-2010,
SEC.106.
IC 28-1-3.1-12 Federal deposit insurance; payments of deposit liabilities;
subrogation
Sec. 12. Whenever a federal deposit insurance agency pays or
makes available for payment the insured deposit liabilities of a
closed financial institution, the federal deposit insurance agency,
whether or not it acts as receiver, shall be subrogated by operation of
law to all rights against the closed financial institutions of each
owner of a claim for deposit so paid by the federal deposit insurance
agency to the extent necessary to enable the federal deposit insurance
agency, under federal law, to make insurance payments available to
depositors of closed financial institutions. As added by P.L.141-1984, SEC.2.
IC 28-1-3.1-13 Successor to closed financial institution's fiduciary duties;
appointment; powers and duties; notice of appointment to
interested parties
Sec. 13. (a) The receiver, with the approval of the receivership
court, may appoint a successor to all rights, obligations, assets,
deposits, agreements, and trusts held by the closed financial
institution as trustee, administrator, executor, guardian, agent, and all
other fiduciary or representative capacities. The successor's duties
and obligations begin upon appointment to the same extent binding
upon the closed financial institution and as though the successor had
originally assumed the duties and obligations. Specifically, the
successor shall succeed to and be entitled to administer all
trusteeships, administrations, executorships, guardianships, agencies,
and all other fiduciary or representative proceedings to which the
closed financial institution is named or appointed in wills, whenever
probated, or to which it is appointed by any other instrument, court
order, or by operation of law.
(b) This section shall not impair any right of the grantor or
beneficiaries of trust assets to secure the appointment of a substituted
trustee or manager.
(c) Within thirty (30) days after appointment, the successor shall
give written notice, insofar as practical, to all interested parties
named in:
(1) the books and records of the closed financial institution; or
(2) trust documents held by it;
that the successor has been appointed in accordance with applicable
law.
(d) If the Federal Deposit Insurance Corporation is the receiver,
compliance with this section is not required. As added by P.L.141-1984, SEC.2. Amended by P.L.35-2010,
SEC.107.
IC 28-1-3.1-14 Personal property left in possession of closed financial institution;
appearances, claims, and disposition
Sec. 14. (a) The receiver shall cause notice to be mailed to:
(1) the owners of any personal property left in the possession of
a closed financial institution for safekeeping or as bailee or
depository for hire;
(2) all lessees; and
(3) other persons in possession of any safe deposit box, vault,
or locker;
requiring those persons to appear and assert their claims to the
property within sixty (60) days from the date of the notice. Within
that time, the owner or owners of the property may appear and assert
their claims to the property. Subject to approval of the receivership
court, the receiver shall make the agreements or arrangements as may
be necessary for the disposition of the property and the contents of
the safe deposit boxes, vaults, or lockers and the termination of any
leases or other contracts relating to the property.
(b) If the Federal Deposit Insurance Corporation is the receiver,
compliance with this section is not required. As added by P.L.141-1984, SEC.2. Amended by P.L.35-2010,
SEC.108.
IC 28-1-3.1-15 Actions to enforce rights, demands, or claims vested in financial
institution, shareholders, or creditors
Sec. 15. The receiver may, within ten (10) years after any cause
of action has accrued against any of the directors, trustees, officers,
owners, or employees of any closed financial institution, institute and
maintain, in the name of the receiver, any action or proceeding for
the enforcement of any right, demand, or claim that is vested in the
financial institution or in the shareholders or creditors of the
financial institution. As added by P.L.141-1984, SEC.2.
IC 28-1-3.1-16 Articles of dissolution; contents; Federal Deposit Insurance
Corporation as receiver; authority of department to act
Sec. 16. (a) When the proceedings described in this chapter have
been completed, the receiver shall execute and file, in the manner
provided in this section, articles of dissolution, setting forth the
following information:
(1) The name of the financial institution.
(2) The place where its principal office is located.
(3) The names and addresses of the directors and officers of the
financial institution at the time when the liquidation
proceedings were begun.
(4) A brief summary of the aggregate amount of general claims
finally allowed against the financial institution, the aggregate
amount of claims allowed as preferred, and the aggregate
amount of all other claims against the financial institution,
together with a statement of the aggregate payments made on
each of the groups of claims and with a reference to:
(A) the orders of the receiver or the receivership court
authorizing those payments; and
(B) the current reports wherein a report of the payments so
ordered is made;
as of the date of the taking possession of the financial
institution by the department.
(5) A brief summary of the aggregate amount of payments made
to the shareholders of the financial institution, whether of
money or other property, and a reference to the orders of the
receiver or the receivership court authorizing the payments and
to the current reports wherein the report of the payment is
made.
(b) If the Federal Deposit Insurance Corporation is the receiver,
the following apply:
(1) Compliance with this section is not required.
(2) The department:
(A) may file the articles of dissolution; and
(B) may take all actions necessary to complete the
dissolution of the financial institution. As added by P.L.141-1984, SEC.2. Amended by P.L.35-2010,
SEC.109.
IC 28-1-3.1-17 Articles of dissolution; execution; presentation; fee
Sec. 17. The articles of dissolution shall be executed in triplicate
and shall be presented in triplicate to the secretary of state at his
office (as provided in section 18 of this chapter) accompanied by the
fees prescribed by law. As added by P.L.141-1984, SEC.2.
IC 28-1-3.1-18 Articles of dissolution; duties of secretary of state
Sec. 18. Upon presentation of the articles of dissolution as
provided in section 17 of this chapter, the secretary of state shall:
(1) endorse his approval upon each of the triplicate copies of
the articles if he finds that they conform to law;
(2) when all fees have been paid as required by law:
(A) file one (1) copy of the articles in his office;
(B) issue a certificate of dissolution to the department; and
(C) return the certificate of dissolution to the department,
together with two (2) copies of the articles of dissolution
bearing the endorsement of his approval. As added by P.L.141-1984, SEC.2.
IC 28-1-3.1-19 Articles of dissolution; filing with county recorder
Sec. 19. The department shall file for record with the county
recorder of the county where the principal office of the financial
institution is located one (1) of the triplicate copies of the articles of
dissolution bearing the endorsement of the approval of the secretary
of state as provided in section 18 of this chapter. As added by P.L.141-1984, SEC.2.
IC 28-1-3.1-20 Dissolution and cessation of existence
Sec. 20. Upon the issuance of the certificate of dissolution and the
recording of the articles of dissolution, as provided in section 19 of
this chapter, the financial institution shall be dissolved and its
existence shall cease. As added by P.L.141-1984, SEC.2.
IC 28-1-3.1-21 Troubled or insolvent financial institutions; federal supervisory
agencies; department's authority to approve transactions
Sec. 21. Whenever a federal supervisory agency is bidding,
consolidating, merging, selling, or otherwise resolving or disposing
of a troubled, an insolvent, or an imminently insolvent financial
institution, the director of the department may approve any
transaction, including the purchase of assets, the assumption of
liabilities, a merger, or the formation of a new financial institution,
if the transaction requires the approval of the department. As added by P.L.42-1993, SEC.24. Amended by P.L.11-1998, SEC.1;
P.L.35-2010, SEC.110.
IC 28-1-3.1
Chapter 3.1. Liquidation of Financial Institutions
IC 28-1-3.1-1 Definitions
Sec. 1. (a) The definitions set forth in this section apply
throughout this chapter.
(b) "Federal deposit insurance agency" means an agency or
instrumentality of the United States that insures to any extent the
deposits of a financial institution, including the Federal Deposit
Insurance Corporation or the National Credit Union Administration.
(c) "Insolvent" means a financial institution that:
(1) is incapable of meeting the demands of creditors or
depositors on a timely basis; or
(2) has liabilities in excess of the total value of its assets as
determined by the department.
(d) "Receiver" means a:
(1) federal deposit insurance agency;
(2) private deposit insurer of credit unions; or
(3) designated agent of the department.
(e) "Receivership court" means the court that the department has
filed the notice of possession with, under this chapter. As added by P.L.141-1984, SEC.2. Amended by P.L.8-1991, SEC.10;
P.L.262-1995, SEC.3.
IC 28-1-3.1-2 Authority of department to take possession of business and
property; conditions; duties of department
Sec. 2. (a) The department may take possession of the business
and property of any financial institution except a consumer finance
institution licensed to make supervised or regulated loans under
IC 24-4.5, whenever it appears to the department that the financial
institution:
(1) is insolvent or in imminent danger of insolvency;
(2) is in an unsafe or unsound condition;
(3) has refused to pay its deposits or obligations in accordance
with the terms under which those deposits or obligations were
incurred;
(4) has refused to submit its records and affairs for inspection
or examination by the department or federal authorities;
(5) has violated any court order, statute, rule, or regulation of
the department or its articles of incorporation and that
continued control of its own affairs threatens injury to the
public, the financial community, its depositors, or other
creditors;
(6) requests through its board of directors that the department
take possession for the benefit of depositors, other creditors,
shareholders, or other persons;
(7) has an impairment of its capital (the capital of a bank or
trust company shall, for the purpose of this subdivision, be
considered to be unimpaired so long as the sound value of its
assets over and above its liabilities, exclusive of liabilities for
capital notes, debentures, and capital stock, as determined by
the department, equals or exceeds the minimum capital or
capital stock required by the department for a bank or trust
company);
(8) has neglected or refused, for a period of thirty (30) days, to
comply with the terms of a duly issued order of the department,
essential to preserve the solvency of the financial institution;
(9) has failed to pay the fees charged by the department under
IC 28-11-3-5 after due notice of the amount of the fee has been
given;
(10) has breached a fiduciary duty under IC 30-4-3-6; or
(11) has violated IC 30-4-3-7 in a way that has caused or may
cause harm to fiduciary accounts.
(b) When the department makes a determination to take
possession of the business and property of a financial institution
under subsection (a), the department shall:
(1) make a finding to that effect and enter that finding on the
records of the proceedings of the department; and
(2) cause a certified copy of the finding to be served on the
president or other executive officer actively in charge of the
financial institution and demand possession of the business,
property, and records of the financial institution from the
officer. The financial institution shall immediately surrender the
possession to the department.
(c) The department or its receiver is not required to become the
owner of any property to fulfill the liquidation requirements of this
chapter. As added by P.L.141-1984, SEC.2. Amended by P.L.33-1991, SEC.9;
P.L.262-1995, SEC.4.
IC 28-1-3.1-3 Holding business and property until liquidation of affairs
Sec. 3. (a) When the department has taken possession of the
business and property of a financial institution under the provisions
of section 2 of this chapter, the department shall hold possession of
the business and property until the affairs of the institution have been
finally liquidated as provided in this chapter, unless the financial
institution has undertaken the voluntary liquidation of its affairs
under IC 28-1-9.
(b) If a corporate fiduciary is to be liquidated, the department may
appoint an agent from within or outside the department to
temporarily conduct the affairs of the corporate fiduciary until a
receiver is appointed. The agent may be required to give bond and
shall be paid reasonable compensation by the corporate fiduciary
being liquidated. As added by P.L.141-1984, SEC.2. Amended by P.L.262-1995,
SEC.5. IC 28-1-3.1-4 Notice; entry of cause; hearing; record; rights and liabilities of
persons interested; Federal Deposit Insurance Corporation as
receiver
Sec. 4. (a) Immediately upon the taking possession of the business
and property of any financial institution under section 2 of this
chapter, the department shall give notice by:
(1) posting the notice at the main entrance of the principal
office of the financial institution;
(2) causing the notice to be served upon the president or other
executive officer actively in charge of the business of the
financial institution; and
(3) filing the notice in the office of the circuit court in the
county where the principal office of the financial institution is
located.
(b) Upon the filing of the notice under subsection (a), the clerk
shall:
(1) note the filing of the notice upon the records of the
receivership court; and
(2) enter the cause as a civil action upon the dockets of the
court under the name and style of "In the matter of the
liquidation of ___________" (inserting the name of the
financial institution).
(c) The receivership court may hear and determine all issues and
matters pertaining to or connected with the liquidation of the
financial institution, including:
(1) the amount of the compensation and necessary expenses of
any special representative, assistant, accountant, agent, or
attorney employed by the department, or the receiver appointed
by the department, as set forth in this chapter; and
(2) all papers and pleadings pertaining to the liquidation
proceedings.
(d) All entries, orders, judgments, and decrees of the receivership
court in connection with the liquidation proceedings shall be filed
and entered of record in the cause of action.
(e) The rights and liabilities of a financial institution and of its
creditors, depositors, shareholders, and all other persons interested
in its estate shall, unless otherwise directed by the court, be fixed as
of the date of the filing of the notice of possession with the
receivership court. In the case of mutual debts or mutual credits of
equal priority between the financial institution and another person,
the credits and debts shall be set off and the balance only shall be
allowed or paid. The right to set off shall be determined as of the
date of the filing of the notice of possession of the financial
institution under subsection (a).
(f) Notwithstanding this section, if the Federal Deposit Insurance
Corporation is appointed receiver of a financial institution,
subsections (a)(3), (b), (c), and (d) do not apply, and applicable
federal law governs the receivership. As added by P.L.141-1984, SEC.2. Amended by P.L.35-2010,
SEC.99.
IC 28-1-3.1-5 Receiver; appointment; vesting of title to all assets and right to
terminate affairs of institution; liens or claims against property
Sec. 5. (a) The department may appoint the receiver of the closed
financial institution. Unless the receiver is the Federal Deposit
Insurance Corporation, the department, upon acceptance of the
appointment of a receiver, shall make immediate application to the
receivership court for confirmation of the receiver. The receivership
court shall approve the department's application if it finds that to do
so would be in the public interest. The application may be acted on
by the receivership court without any notice except that provided in
section 4 of this chapter. The receiver shall give a bond the director
considers appropriate. However, a federal deposit insurance agency
shall not be required to post any bond. If the receiver is not a federal
deposit insurance agency, the director may agree to reasonable
compensation for the receiver.
(b) Upon appointment as receiver, title to all assets of the
financial institution vest in the receiver without the execution of any
instruments of conveyance, assignment, transfer, or endorsement. If
no other receiver is appointed as provided in this chapter, the
department shall act as receiver and has all of the powers and duties
of a receiver as provided in this chapter.
(c) Except as otherwise provided, the sole and exclusive right to
liquidate and terminate the affairs of any financial institution is
vested in the receiver appointed under this section, and except as
otherwise provided by law, no other receiver, assignee, trustee, or
liquidating agent shall be appointed by any court or any other person.
(d) After the department has taken possession of the business and
property for any financial institution, no suit, action, or other
proceeding at law or in equity shall be commenced or prosecuted
against the financial institution upon any debt, obligation, claim, or
demand.
(e) No person, firm, limited liability company, corporation, or
other entity holding any of the property or credits of the financial
institution shall have any lien or charge against the property or
credits for any payment, advance, or clearance made after the
department has taken possession. A lien shall not attach to any of the
assets or property of the financial institution by reason of the entry
of any judgment recovered against the institution after the
department has taken possession of its business and property and
while the possession continues.
(f) A receiver appointed to liquidate a corporate fiduciary must
have sufficient experience in fiduciary matters. As added by P.L.141-1984, SEC.2. Amended by P.L.8-1993,
SEC.438; P.L.262-1995, SEC.6; P.L.35-2010, SEC.100.
IC 28-1-3.1-6 Receiver; authority
Sec. 6. The receiver of a closed financial institution may do the
following:
(1) Take possession of all books, records, and assets of the
financial institution.
(2) Collect all debts, claims, and judgments belonging to the
financial institution and do such other acts as are necessary to
preserve and liquidate its assets.
(3) Execute in the name of the financial institution any
instrument necessary or proper to effectuate its powers or
perform its duties as receiver.
(4) Initiate, pursue, and defend litigation involving any right,
claim, interest, or liability of the financial institution.
(5) Exercise any and all fiduciary functions of the financial
institution as of the date of appointment as receiver.
(6) Borrow money as necessary in the liquidation of the
financial institution and secure the borrowings by the pledge or
mortgage of assets.
(7) Abandon or convey title to any holder of a mortgage,
security deed, security interest, or lien against property in which
the financial institution has an interest whenever the receiver
determines that to continue to claim that interest is burdensome
and of no advantage to the financial institution, its depositors,
creditors, or shareholders.
(8) Subject to the approval of the receivership court:
(A) sell any and all real and personal property to
compromise any debt, claim, or judgment due to the
financial institution and discontinue any action or other
proceeding pending; or
(B) pay off all mortgages, securities deeds, security
agreements, and liens upon any real or personal property
belonging to the financial institution and purchase at a
judicial sale or at a sale authorized by court order, any real
or personal property in order to protect the financial
institution's equity in that property.
(9) If, at the time of liquidation, a closed financial institution
holds property in trust for an individual or a corporation under
or by virtue of a trust instrument, the administration of the
property must be handled in the manner set forth in IC 28-1-9-7.
Notwithstanding this section, when the Federal Deposit Insurance
Corporation is appointed receiver of a financial institution,
subdivision (8) does not apply. As added by P.L.141-1984, SEC.2. Amended by P.L.42-1993,
SEC.23; P.L.262-1995, SEC.7; P.L.35-2010, SEC.101.
IC 28-1-3.1-7 Receiver's authority to sell assets; borrowing of money for deposit
liabilities
Sec. 7. The receiver may, with ex parte approval of the
receivership court, sell all or any part of the financial institution's
assets to another state or federally chartered financial institution or
to a federal deposit insurance agency acting in its corporate capacity.
The Federal Deposit Insurance Corporation is not required to seek ex
parte approval of the receivership court. The receiver may also
borrow from a federal deposit insurance agency any amount
necessary to facilitate the assumption of deposit liabilities by a newly
chartered or existing state or federally chartered financial institution,
assigning any part or all of the assets of the financial institution as
security for the loan. As added by P.L.141-1984, SEC.2. Amended by P.L.35-2010,
SEC.102.
IC 28-1-3.1-8 Claims; presentation; notice; rejection
Sec. 8. (a) All parties having claims against the closed financial
institution shall present their claims supported by proof to the
receiver within one hundred eighty (180) days after the department
has taken possession.
(b) The receiver shall cause notice of the claims procedure
prescribed by this section to be:
(1) published once a week for twelve (12) consecutive weeks in
a newspaper of general circulation published in the county in
which the receivership court is located; and
(2) mailed to each person whose name appears as a creditor
upon books of the financial institution at the person's last
address of record.
(c) Within one hundred eighty (180) days following receipt of
claim, the receiver shall notify in writing any claimant whose claim
has been rejected. Notice is effective when mailed. Any claimant
whose claim has been rejected by the receiver may petition the
receivership court for a hearing on the claim within sixty (60) days
from the date the claim is rejected.
(d) If the Federal Deposit Insurance Corporation is the receiver,
compliance with this section is not required. As added by P.L.141-1984, SEC.2. Amended by P.L.35-2010,
SEC.103.
IC 28-1-3.1-9 Late claims
Sec. 9. Any claims filed after the one hundred eighty (180) day
claim period prescribed by section 8 of this chapter and subsequently
accepted by the receiver or allowed by the receivership court shall be
entitled to share in the distribution of assets only to the extent of the
undistributed assets in the hands of the receiver on the date the
claims are accepted or allowed. If the Federal Deposit Insurance
Corporation is the receiver, compliance with this section is not
required. As added by P.L.141-1984, SEC.2. Amended by P.L.35-2010,
SEC.104. IC 28-1-3.1-10
Repealed
(Repealed by P.L.42-1993, SEC.103.)
IC 28-1-3.1-10.1 Payment of claims; order
Sec. 10.1. (a) All claims against the financial institution that are
proved to the satisfaction of the receiver or approved by the
receivership court shall be paid in the following order:
(1) Claims of persons referred to in IC 28-1-12-6 as having
preference and priority.
(2) Administration expenses of the liquidation, including the
following:
(A) Court costs.
(B) Compensation and actual expenses incurred by the
department or the receiver in order to facilitate the
liquidation.
(C) Compensation of each regular officer or employee of the
receiver for the time actually devoted by the officer or
employee to the liquidation of the financial institution at an
amount not to exceed the compensation paid to the officer or
employee for the performance of the regular duties of the
officer or employee.
(D) Actual expenses of each regular officer or employee of
the receiver that are necessarily incurred in the performance
of the duties of the officer or employee in the liquidation.
(E) Compensation and expenses of any special
representative, assistant, accountant, agent, or attorney
employed by the receiver.
(F) The reasonable general overhead expenses that are
incurred by the department or the receiver in the liquidation
of the affairs of the financial institution.
(3) Claims given priority under other provisions of state or
federal law.
(4) Deposit obligations.
(5) Other general liabilities.
(6) Debt subordinated to the claims of general creditors.
(7) Equity capital securities.
(b) Interest may not be paid on any claim until the full principal
amount of every claim within the same class has been paid.
(c) If the Federal Deposit Insurance Corporation is the receiver,
compliance with this section is not required. As added by P.L.262-1995, SEC.8. Amended by P.L.35-2010,
SEC.105.
IC 28-1-3.1-11 Rejection of executory contracts and leases
Sec. 11. (a) Within one hundred eighty (180) days of the date that
the department has taken possession, the receiver may, at his
election, reject:
(1) any executory contract to which the closed financial
institution is a party without any further liability to the closed
financial institution or the receiver; or
(2) any obligation of the financial institution as a lessee of real
or personal property.
The receiver's election to reject a lease shall create no claim for rent
other than rent accrued to the date of termination or for actual
damages, if any, for the termination not to exceed the equivalent of
payment of rent for six (6) months.
(b) If the Federal Deposit Insurance Corporation is the receiver,
compliance with this section is not required. As added by P.L.141-1984, SEC.2. Amended by P.L.35-2010,
SEC.106.
IC 28-1-3.1-12 Federal deposit insurance; payments of deposit liabilities;
subrogation
Sec. 12. Whenever a federal deposit insurance agency pays or
makes available for payment the insured deposit liabilities of a
closed financial institution, the federal deposit insurance agency,
whether or not it acts as receiver, shall be subrogated by operation of
law to all rights against the closed financial institutions of each
owner of a claim for deposit so paid by the federal deposit insurance
agency to the extent necessary to enable the federal deposit insurance
agency, under federal law, to make insurance payments available to
depositors of closed financial institutions. As added by P.L.141-1984, SEC.2.
IC 28-1-3.1-13 Successor to closed financial institution's fiduciary duties;
appointment; powers and duties; notice of appointment to
interested parties
Sec. 13. (a) The receiver, with the approval of the receivership
court, may appoint a successor to all rights, obligations, assets,
deposits, agreements, and trusts held by the closed financial
institution as trustee, administrator, executor, guardian, agent, and all
other fiduciary or representative capacities. The successor's duties
and obligations begin upon appointment to the same extent binding
upon the closed financial institution and as though the successor had
originally assumed the duties and obligations. Specifically, the
successor shall succeed to and be entitled to administer all
trusteeships, administrations, executorships, guardianships, agencies,
and all other fiduciary or representative proceedings to which the
closed financial institution is named or appointed in wills, whenever
probated, or to which it is appointed by any other instrument, court
order, or by operation of law.
(b) This section shall not impair any right of the grantor or
beneficiaries of trust assets to secure the appointment of a substituted
trustee or manager.
(c) Within thirty (30) days after appointment, the successor shall
give written notice, insofar as practical, to all interested parties
named in:
(1) the books and records of the closed financial institution; or
(2) trust documents held by it;
that the successor has been appointed in accordance with applicable
law.
(d) If the Federal Deposit Insurance Corporation is the receiver,
compliance with this section is not required. As added by P.L.141-1984, SEC.2. Amended by P.L.35-2010,
SEC.107.
IC 28-1-3.1-14 Personal property left in possession of closed financial institution;
appearances, claims, and disposition
Sec. 14. (a) The receiver shall cause notice to be mailed to:
(1) the owners of any personal property left in the possession of
a closed financial institution for safekeeping or as bailee or
depository for hire;
(2) all lessees; and
(3) other persons in possession of any safe deposit box, vault,
or locker;
requiring those persons to appear and assert their claims to the
property within sixty (60) days from the date of the notice. Within
that time, the owner or owners of the property may appear and assert
their claims to the property. Subject to approval of the receivership
court, the receiver shall make the agreements or arrangements as may
be necessary for the disposition of the property and the contents of
the safe deposit boxes, vaults, or lockers and the termination of any
leases or other contracts relating to the property.
(b) If the Federal Deposit Insurance Corporation is the receiver,
compliance with this section is not required. As added by P.L.141-1984, SEC.2. Amended by P.L.35-2010,
SEC.108.
IC 28-1-3.1-15 Actions to enforce rights, demands, or claims vested in financial
institution, shareholders, or creditors
Sec. 15. The receiver may, within ten (10) years after any cause
of action has accrued against any of the directors, trustees, officers,
owners, or employees of any closed financial institution, institute and
maintain, in the name of the receiver, any action or proceeding for
the enforcement of any right, demand, or claim that is vested in the
financial institution or in the shareholders or creditors of the
financial institution. As added by P.L.141-1984, SEC.2.
IC 28-1-3.1-16 Articles of dissolution; contents; Federal Deposit Insurance
Corporation as receiver; authority of department to act
Sec. 16. (a) When the proceedings described in this chapter have
been completed, the receiver shall execute and file, in the manner
provided in this section, articles of dissolution, setting forth the
following information:
(1) The name of the financial institution.
(2) The place where its principal office is located.
(3) The names and addresses of the directors and officers of the
financial institution at the time when the liquidation
proceedings were begun.
(4) A brief summary of the aggregate amount of general claims
finally allowed against the financial institution, the aggregate
amount of claims allowed as preferred, and the aggregate
amount of all other claims against the financial institution,
together with a statement of the aggregate payments made on
each of the groups of claims and with a reference to:
(A) the orders of the receiver or the receivership court
authorizing those payments; and
(B) the current reports wherein a report of the payments so
ordered is made;
as of the date of the taking possession of the financial
institution by the department.
(5) A brief summary of the aggregate amount of payments made
to the shareholders of the financial institution, whether of
money or other property, and a reference to the orders of the
receiver or the receivership court authorizing the payments and
to the current reports wherein the report of the payment is
made.
(b) If the Federal Deposit Insurance Corporation is the receiver,
the following apply:
(1) Compliance with this section is not required.
(2) The department:
(A) may file the articles of dissolution; and
(B) may take all actions necessary to complete the
dissolution of the financial institution. As added by P.L.141-1984, SEC.2. Amended by P.L.35-2010,
SEC.109.
IC 28-1-3.1-17 Articles of dissolution; execution; presentation; fee
Sec. 17. The articles of dissolution shall be executed in triplicate
and shall be presented in triplicate to the secretary of state at his
office (as provided in section 18 of this chapter) accompanied by the
fees prescribed by law. As added by P.L.141-1984, SEC.2.
IC 28-1-3.1-18 Articles of dissolution; duties of secretary of state
Sec. 18. Upon presentation of the articles of dissolution as
provided in section 17 of this chapter, the secretary of state shall:
(1) endorse his approval upon each of the triplicate copies of
the articles if he finds that they conform to law;
(2) when all fees have been paid as required by law:
(A) file one (1) copy of the articles in his office;
(B) issue a certificate of dissolution to the department; and
(C) return the certificate of dissolution to the department,
together with two (2) copies of the articles of dissolution
bearing the endorsement of his approval. As added by P.L.141-1984, SEC.2.
IC 28-1-3.1-19 Articles of dissolution; filing with county recorder
Sec. 19. The department shall file for record with the county
recorder of the county where the principal office of the financial
institution is located one (1) of the triplicate copies of the articles of
dissolution bearing the endorsement of the approval of the secretary
of state as provided in section 18 of this chapter. As added by P.L.141-1984, SEC.2.
IC 28-1-3.1-20 Dissolution and cessation of existence
Sec. 20. Upon the issuance of the certificate of dissolution and the
recording of the articles of dissolution, as provided in section 19 of
this chapter, the financial institution shall be dissolved and its
existence shall cease. As added by P.L.141-1984, SEC.2.
IC 28-1-3.1-21 Troubled or insolvent financial institutions; federal supervisory
agencies; department's authority to approve transactions
Sec. 21. Whenever a federal supervisory agency is bidding,
consolidating, merging, selling, or otherwise resolving or disposing
of a troubled, an insolvent, or an imminently insolvent financial
institution, the director of the department may approve any
transaction, including the purchase of assets, the assumption of
liabilities, a merger, or the formation of a new financial institution,
if the transaction requires the approval of the department. As added by P.L.42-1993, SEC.24. Amended by P.L.11-1998, SEC.1;
P.L.35-2010, SEC.110.
IC 28-1-3.1
Chapter 3.1. Liquidation of Financial Institutions
IC 28-1-3.1-1 Definitions
Sec. 1. (a) The definitions set forth in this section apply
throughout this chapter.
(b) "Federal deposit insurance agency" means an agency or
instrumentality of the United States that insures to any extent the
deposits of a financial institution, including the Federal Deposit
Insurance Corporation or the National Credit Union Administration.
(c) "Insolvent" means a financial institution that:
(1) is incapable of meeting the demands of creditors or
depositors on a timely basis; or
(2) has liabilities in excess of the total value of its assets as
determined by the department.
(d) "Receiver" means a:
(1) federal deposit insurance agency;
(2) private deposit insurer of credit unions; or
(3) designated agent of the department.
(e) "Receivership court" means the court that the department has
filed the notice of possession with, under this chapter. As added by P.L.141-1984, SEC.2. Amended by P.L.8-1991, SEC.10;
P.L.262-1995, SEC.3.
IC 28-1-3.1-2 Authority of department to take possession of business and
property; conditions; duties of department
Sec. 2. (a) The department may take possession of the business
and property of any financial institution except a consumer finance
institution licensed to make supervised or regulated loans under
IC 24-4.5, whenever it appears to the department that the financial
institution:
(1) is insolvent or in imminent danger of insolvency;
(2) is in an unsafe or unsound condition;
(3) has refused to pay its deposits or obligations in accordance
with the terms under which those deposits or obligations were
incurred;
(4) has refused to submit its records and affairs for inspection
or examination by the department or federal authorities;
(5) has violated any court order, statute, rule, or regulation of
the department or its articles of incorporation and that
continued control of its own affairs threatens injury to the
public, the financial community, its depositors, or other
creditors;
(6) requests through its board of directors that the department
take possession for the benefit of depositors, other creditors,
shareholders, or other persons;
(7) has an impairment of its capital (the capital of a bank or
trust company shall, for the purpose of this subdivision, be
considered to be unimpaired so long as the sound value of its
assets over and above its liabilities, exclusive of liabilities for
capital notes, debentures, and capital stock, as determined by
the department, equals or exceeds the minimum capital or
capital stock required by the department for a bank or trust
company);
(8) has neglected or refused, for a period of thirty (30) days, to
comply with the terms of a duly issued order of the department,
essential to preserve the solvency of the financial institution;
(9) has failed to pay the fees charged by the department under
IC 28-11-3-5 after due notice of the amount of the fee has been
given;
(10) has breached a fiduciary duty under IC 30-4-3-6; or
(11) has violated IC 30-4-3-7 in a way that has caused or may
cause harm to fiduciary accounts.
(b) When the department makes a determination to take
possession of the business and property of a financial institution
under subsection (a), the department shall:
(1) make a finding to that effect and enter that finding on the
records of the proceedings of the department; and
(2) cause a certified copy of the finding to be served on the
president or other executive officer actively in charge of the
financial institution and demand possession of the business,
property, and records of the financial institution from the
officer. The financial institution shall immediately surrender the
possession to the department.
(c) The department or its receiver is not required to become the
owner of any property to fulfill the liquidation requirements of this
chapter. As added by P.L.141-1984, SEC.2. Amended by P.L.33-1991, SEC.9;
P.L.262-1995, SEC.4.
IC 28-1-3.1-3 Holding business and property until liquidation of affairs
Sec. 3. (a) When the department has taken possession of the
business and property of a financial institution under the provisions
of section 2 of this chapter, the department shall hold possession of
the business and property until the affairs of the institution have been
finally liquidated as provided in this chapter, unless the financial
institution has undertaken the voluntary liquidation of its affairs
under IC 28-1-9.
(b) If a corporate fiduciary is to be liquidated, the department may
appoint an agent from within or outside the department to
temporarily conduct the affairs of the corporate fiduciary until a
receiver is appointed. The agent may be required to give bond and
shall be paid reasonable compensation by the corporate fiduciary
being liquidated. As added by P.L.141-1984, SEC.2. Amended by P.L.262-1995,
SEC.5. IC 28-1-3.1-4 Notice; entry of cause; hearing; record; rights and liabilities of
persons interested; Federal Deposit Insurance Corporation as
receiver
Sec. 4. (a) Immediately upon the taking possession of the business
and property of any financial institution under section 2 of this
chapter, the department shall give notice by:
(1) posting the notice at the main entrance of the principal
office of the financial institution;
(2) causing the notice to be served upon the president or other
executive officer actively in charge of the business of the
financial institution; and
(3) filing the notice in the office of the circuit court in the
county where the principal office of the financial institution is
located.
(b) Upon the filing of the notice under subsection (a), the clerk
shall:
(1) note the filing of the notice upon the records of the
receivership court; and
(2) enter the cause as a civil action upon the dockets of the
court under the name and style of "In the matter of the
liquidation of ___________" (inserting the name of the
financial institution).
(c) The receivership court may hear and determine all issues and
matters pertaining to or connected with the liquidation of the
financial institution, including:
(1) the amount of the compensation and necessary expenses of
any special representative, assistant, accountant, agent, or
attorney employed by the department, or the receiver appointed
by the department, as set forth in this chapter; and
(2) all papers and pleadings pertaining to the liquidation
proceedings.
(d) All entries, orders, judgments, and decrees of the receivership
court in connection with the liquidation proceedings shall be filed
and entered of record in the cause of action.
(e) The rights and liabilities of a financial institution and of its
creditors, depositors, shareholders, and all other persons interested
in its estate shall, unless otherwise directed by the court, be fixed as
of the date of the filing of the notice of possession with the
receivership court. In the case of mutual debts or mutual credits of
equal priority between the financial institution and another person,
the credits and debts shall be set off and the balance only shall be
allowed or paid. The right to set off shall be determined as of the
date of the filing of the notice of possession of the financial
institution under subsection (a).
(f) Notwithstanding this section, if the Federal Deposit Insurance
Corporation is appointed receiver of a financial institution,
subsections (a)(3), (b), (c), and (d) do not apply, and applicable
federal law governs the receivership. As added by P.L.141-1984, SEC.2. Amended by P.L.35-2010,
SEC.99.
IC 28-1-3.1-5 Receiver; appointment; vesting of title to all assets and right to
terminate affairs of institution; liens or claims against property
Sec. 5. (a) The department may appoint the receiver of the closed
financial institution. Unless the receiver is the Federal Deposit
Insurance Corporation, the department, upon acceptance of the
appointment of a receiver, shall make immediate application to the
receivership court for confirmation of the receiver. The receivership
court shall approve the department's application if it finds that to do
so would be in the public interest. The application may be acted on
by the receivership court without any notice except that provided in
section 4 of this chapter. The receiver shall give a bond the director
considers appropriate. However, a federal deposit insurance agency
shall not be required to post any bond. If the receiver is not a federal
deposit insurance agency, the director may agree to reasonable
compensation for the receiver.
(b) Upon appointment as receiver, title to all assets of the
financial institution vest in the receiver without the execution of any
instruments of conveyance, assignment, transfer, or endorsement. If
no other receiver is appointed as provided in this chapter, the
department shall act as receiver and has all of the powers and duties
of a receiver as provided in this chapter.
(c) Except as otherwise provided, the sole and exclusive right to
liquidate and terminate the affairs of any financial institution is
vested in the receiver appointed under this section, and except as
otherwise provided by law, no other receiver, assignee, trustee, or
liquidating agent shall be appointed by any court or any other person.
(d) After the department has taken possession of the business and
property for any financial institution, no suit, action, or other
proceeding at law or in equity shall be commenced or prosecuted
against the financial institution upon any debt, obligation, claim, or
demand.
(e) No person, firm, limited liability company, corporation, or
other entity holding any of the property or credits of the financial
institution shall have any lien or charge against the property or
credits for any payment, advance, or clearance made after the
department has taken possession. A lien shall not attach to any of the
assets or property of the financial institution by reason of the entry
of any judgment recovered against the institution after the
department has taken possession of its business and property and
while the possession continues.
(f) A receiver appointed to liquidate a corporate fiduciary must
have sufficient experience in fiduciary matters. As added by P.L.141-1984, SEC.2. Amended by P.L.8-1993,
SEC.438; P.L.262-1995, SEC.6; P.L.35-2010, SEC.100.
IC 28-1-3.1-6 Receiver; authority
Sec. 6. The receiver of a closed financial institution may do the
following:
(1) Take possession of all books, records, and assets of the
financial institution.
(2) Collect all debts, claims, and judgments belonging to the
financial institution and do such other acts as are necessary to
preserve and liquidate its assets.
(3) Execute in the name of the financial institution any
instrument necessary or proper to effectuate its powers or
perform its duties as receiver.
(4) Initiate, pursue, and defend litigation involving any right,
claim, interest, or liability of the financial institution.
(5) Exercise any and all fiduciary functions of the financial
institution as of the date of appointment as receiver.
(6) Borrow money as necessary in the liquidation of the
financial institution and secure the borrowings by the pledge or
mortgage of assets.
(7) Abandon or convey title to any holder of a mortgage,
security deed, security interest, or lien against property in which
the financial institution has an interest whenever the receiver
determines that to continue to claim that interest is burdensome
and of no advantage to the financial institution, its depositors,
creditors, or shareholders.
(8) Subject to the approval of the receivership court:
(A) sell any and all real and personal property to
compromise any debt, claim, or judgment due to the
financial institution and discontinue any action or other
proceeding pending; or
(B) pay off all mortgages, securities deeds, security
agreements, and liens upon any real or personal property
belonging to the financial institution and purchase at a
judicial sale or at a sale authorized by court order, any real
or personal property in order to protect the financial
institution's equity in that property.
(9) If, at the time of liquidation, a closed financial institution
holds property in trust for an individual or a corporation under
or by virtue of a trust instrument, the administration of the
property must be handled in the manner set forth in IC 28-1-9-7.
Notwithstanding this section, when the Federal Deposit Insurance
Corporation is appointed receiver of a financial institution,
subdivision (8) does not apply. As added by P.L.141-1984, SEC.2. Amended by P.L.42-1993,
SEC.23; P.L.262-1995, SEC.7; P.L.35-2010, SEC.101.
IC 28-1-3.1-7 Receiver's authority to sell assets; borrowing of money for deposit
liabilities
Sec. 7. The receiver may, with ex parte approval of the
receivership court, sell all or any part of the financial institution's
assets to another state or federally chartered financial institution or
to a federal deposit insurance agency acting in its corporate capacity.
The Federal Deposit Insurance Corporation is not required to seek ex
parte approval of the receivership court. The receiver may also
borrow from a federal deposit insurance agency any amount
necessary to facilitate the assumption of deposit liabilities by a newly
chartered or existing state or federally chartered financial institution,
assigning any part or all of the assets of the financial institution as
security for the loan. As added by P.L.141-1984, SEC.2. Amended by P.L.35-2010,
SEC.102.
IC 28-1-3.1-8 Claims; presentation; notice; rejection
Sec. 8. (a) All parties having claims against the closed financial
institution shall present their claims supported by proof to the
receiver within one hundred eighty (180) days after the department
has taken possession.
(b) The receiver shall cause notice of the claims procedure
prescribed by this section to be:
(1) published once a week for twelve (12) consecutive weeks in
a newspaper of general circulation published in the county in
which the receivership court is located; and
(2) mailed to each person whose name appears as a creditor
upon books of the financial institution at the person's last
address of record.
(c) Within one hundred eighty (180) days following receipt of
claim, the receiver shall notify in writing any claimant whose claim
has been rejected. Notice is effective when mailed. Any claimant
whose claim has been rejected by the receiver may petition the
receivership court for a hearing on the claim within sixty (60) days
from the date the claim is rejected.
(d) If the Federal Deposit Insurance Corporation is the receiver,
compliance with this section is not required. As added by P.L.141-1984, SEC.2. Amended by P.L.35-2010,
SEC.103.
IC 28-1-3.1-9 Late claims
Sec. 9. Any claims filed after the one hundred eighty (180) day
claim period prescribed by section 8 of this chapter and subsequently
accepted by the receiver or allowed by the receivership court shall be
entitled to share in the distribution of assets only to the extent of the
undistributed assets in the hands of the receiver on the date the
claims are accepted or allowed. If the Federal Deposit Insurance
Corporation is the receiver, compliance with this section is not
required. As added by P.L.141-1984, SEC.2. Amended by P.L.35-2010,
SEC.104. IC 28-1-3.1-10
Repealed
(Repealed by P.L.42-1993, SEC.103.)
IC 28-1-3.1-10.1 Payment of claims; order
Sec. 10.1. (a) All claims against the financial institution that are
proved to the satisfaction of the receiver or approved by the
receivership court shall be paid in the following order:
(1) Claims of persons referred to in IC 28-1-12-6 as having
preference and priority.
(2) Administration expenses of the liquidation, including the
following:
(A) Court costs.
(B) Compensation and actual expenses incurred by the
department or the receiver in order to facilitate the
liquidation.
(C) Compensation of each regular officer or employee of the
receiver for the time actually devoted by the officer or
employee to the liquidation of the financial institution at an
amount not to exceed the compensation paid to the officer or
employee for the performance of the regular duties of the
officer or employee.
(D) Actual expenses of each regular officer or employee of
the receiver that are necessarily incurred in the performance
of the duties of the officer or employee in the liquidation.
(E) Compensation and expenses of any special
representative, assistant, accountant, agent, or attorney
employed by the receiver.
(F) The reasonable general overhead expenses that are
incurred by the department or the receiver in the liquidation
of the affairs of the financial institution.
(3) Claims given priority under other provisions of state or
federal law.
(4) Deposit obligations.
(5) Other general liabilities.
(6) Debt subordinated to the claims of general creditors.
(7) Equity capital securities.
(b) Interest may not be paid on any claim until the full principal
amount of every claim within the same class has been paid.
(c) If the Federal Deposit Insurance Corporation is the receiver,
compliance with this section is not required. As added by P.L.262-1995, SEC.8. Amended by P.L.35-2010,
SEC.105.
IC 28-1-3.1-11 Rejection of executory contracts and leases
Sec. 11. (a) Within one hundred eighty (180) days of the date that
the department has taken possession, the receiver may, at his
election, reject:
(1) any executory contract to which the closed financial
institution is a party without any further liability to the closed
financial institution or the receiver; or
(2) any obligation of the financial institution as a lessee of real
or personal property.
The receiver's election to reject a lease shall create no claim for rent
other than rent accrued to the date of termination or for actual
damages, if any, for the termination not to exceed the equivalent of
payment of rent for six (6) months.
(b) If the Federal Deposit Insurance Corporation is the receiver,
compliance with this section is not required. As added by P.L.141-1984, SEC.2. Amended by P.L.35-2010,
SEC.106.
IC 28-1-3.1-12 Federal deposit insurance; payments of deposit liabilities;
subrogation
Sec. 12. Whenever a federal deposit insurance agency pays or
makes available for payment the insured deposit liabilities of a
closed financial institution, the federal deposit insurance agency,
whether or not it acts as receiver, shall be subrogated by operation of
law to all rights against the closed financial institutions of each
owner of a claim for deposit so paid by the federal deposit insurance
agency to the extent necessary to enable the federal deposit insurance
agency, under federal law, to make insurance payments available to
depositors of closed financial institutions. As added by P.L.141-1984, SEC.2.
IC 28-1-3.1-13 Successor to closed financial institution's fiduciary duties;
appointment; powers and duties; notice of appointment to
interested parties
Sec. 13. (a) The receiver, with the approval of the receivership
court, may appoint a successor to all rights, obligations, assets,
deposits, agreements, and trusts held by the closed financial
institution as trustee, administrator, executor, guardian, agent, and all
other fiduciary or representative capacities. The successor's duties
and obligations begin upon appointment to the same extent binding
upon the closed financial institution and as though the successor had
originally assumed the duties and obligations. Specifically, the
successor shall succeed to and be entitled to administer all
trusteeships, administrations, executorships, guardianships, agencies,
and all other fiduciary or representative proceedings to which the
closed financial institution is named or appointed in wills, whenever
probated, or to which it is appointed by any other instrument, court
order, or by operation of law.
(b) This section shall not impair any right of the grantor or
beneficiaries of trust assets to secure the appointment of a substituted
trustee or manager.
(c) Within thirty (30) days after appointment, the successor shall
give written notice, insofar as practical, to all interested parties
named in:
(1) the books and records of the closed financial institution; or
(2) trust documents held by it;
that the successor has been appointed in accordance with applicable
law.
(d) If the Federal Deposit Insurance Corporation is the receiver,
compliance with this section is not required. As added by P.L.141-1984, SEC.2. Amended by P.L.35-2010,
SEC.107.
IC 28-1-3.1-14 Personal property left in possession of closed financial institution;
appearances, claims, and disposition
Sec. 14. (a) The receiver shall cause notice to be mailed to:
(1) the owners of any personal property left in the possession of
a closed financial institution for safekeeping or as bailee or
depository for hire;
(2) all lessees; and
(3) other persons in possession of any safe deposit box, vault,
or locker;
requiring those persons to appear and assert their claims to the
property within sixty (60) days from the date of the notice. Within
that time, the owner or owners of the property may appear and assert
their claims to the property. Subject to approval of the receivership
court, the receiver shall make the agreements or arrangements as may
be necessary for the disposition of the property and the contents of
the safe deposit boxes, vaults, or lockers and the termination of any
leases or other contracts relating to the property.
(b) If the Federal Deposit Insurance Corporation is the receiver,
compliance with this section is not required. As added by P.L.141-1984, SEC.2. Amended by P.L.35-2010,
SEC.108.
IC 28-1-3.1-15 Actions to enforce rights, demands, or claims vested in financial
institution, shareholders, or creditors
Sec. 15. The receiver may, within ten (10) years after any cause
of action has accrued against any of the directors, trustees, officers,
owners, or employees of any closed financial institution, institute and
maintain, in the name of the receiver, any action or proceeding for
the enforcement of any right, demand, or claim that is vested in the
financial institution or in the shareholders or creditors of the
financial institution. As added by P.L.141-1984, SEC.2.
IC 28-1-3.1-16 Articles of dissolution; contents; Federal Deposit Insurance
Corporation as receiver; authority of department to act
Sec. 16. (a) When the proceedings described in this chapter have
been completed, the receiver shall execute and file, in the manner
provided in this section, articles of dissolution, setting forth the
following information:
(1) The name of the financial institution.
(2) The place where its principal office is located.
(3) The names and addresses of the directors and officers of the
financial institution at the time when the liquidation
proceedings were begun.
(4) A brief summary of the aggregate amount of general claims
finally allowed against the financial institution, the aggregate
amount of claims allowed as preferred, and the aggregate
amount of all other claims against the financial institution,
together with a statement of the aggregate payments made on
each of the groups of claims and with a reference to:
(A) the orders of the receiver or the receivership court
authorizing those payments; and
(B) the current reports wherein a report of the payments so
ordered is made;
as of the date of the taking possession of the financial
institution by the department.
(5) A brief summary of the aggregate amount of payments made
to the shareholders of the financial institution, whether of
money or other property, and a reference to the orders of the
receiver or the receivership court authorizing the payments and
to the current reports wherein the report of the payment is
made.
(b) If the Federal Deposit Insurance Corporation is the receiver,
the following apply:
(1) Compliance with this section is not required.
(2) The department:
(A) may file the articles of dissolution; and
(B) may take all actions necessary to complete the
dissolution of the financial institution. As added by P.L.141-1984, SEC.2. Amended by P.L.35-2010,
SEC.109.
IC 28-1-3.1-17 Articles of dissolution; execution; presentation; fee
Sec. 17. The articles of dissolution shall be executed in triplicate
and shall be presented in triplicate to the secretary of state at his
office (as provided in section 18 of this chapter) accompanied by the
fees prescribed by law. As added by P.L.141-1984, SEC.2.
IC 28-1-3.1-18 Articles of dissolution; duties of secretary of state
Sec. 18. Upon presentation of the articles of dissolution as
provided in section 17 of this chapter, the secretary of state shall:
(1) endorse his approval upon each of the triplicate copies of
the articles if he finds that they conform to law;
(2) when all fees have been paid as required by law:
(A) file one (1) copy of the articles in his office;
(B) issue a certificate of dissolution to the department; and
(C) return the certificate of dissolution to the department,
together with two (2) copies of the articles of dissolution
bearing the endorsement of his approval. As added by P.L.141-1984, SEC.2.
IC 28-1-3.1-19 Articles of dissolution; filing with county recorder
Sec. 19. The department shall file for record with the county
recorder of the county where the principal office of the financial
institution is located one (1) of the triplicate copies of the articles of
dissolution bearing the endorsement of the approval of the secretary
of state as provided in section 18 of this chapter. As added by P.L.141-1984, SEC.2.
IC 28-1-3.1-20 Dissolution and cessation of existence
Sec. 20. Upon the issuance of the certificate of dissolution and the
recording of the articles of dissolution, as provided in section 19 of
this chapter, the financial institution shall be dissolved and its
existence shall cease. As added by P.L.141-1984, SEC.2.
IC 28-1-3.1-21 Troubled or insolvent financial institutions; federal supervisory
agencies; department's authority to approve transactions
Sec. 21. Whenever a federal supervisory agency is bidding,
consolidating, merging, selling, or otherwise resolving or disposing
of a troubled, an insolvent, or an imminently insolvent financial
institution, the director of the department may approve any
transaction, including the purchase of assets, the assumption of
liabilities, a merger, or the formation of a new financial institution,
if the transaction requires the approval of the department. As added by P.L.42-1993, SEC.24. Amended by P.L.11-1998, SEC.1;
P.L.35-2010, SEC.110.
