9-1135.   Trust branch bank defined; application; conditions.(a) Notwithstanding the requirements contained in K.S.A.9-1111, and amendments thereto, a bank incorporated under the laws ofthis statemay establish or operate a trust branch bank anywhere in this state.

      (b)   As used in this section, the term "trust branch bank" means any office,agency or other place of business located within this state, other than theplace of business specified in the bank's certificate of authority, the solepurpose of which is to exercise those trust powers grantedto the bank by the commissioner pursuant to K.S.A. 9-1602, andamendmentsthereto. No trust branch bank established or operated pursuant to this sectionshall be authorized to receive deposits, pay checks or lend money without firstapplying for and obtaining approval as provided in K.S.A. 9-1111, andamendmentsthereto.

      (c)   No bank shall establish or operate a trust branch bank or relocate anexisting trust branch bank until the bank has applied for and obtained approvalfrom the commissioner as provided by this section.

      (d)   An application to establish a trust branch bank as provided in thissection shall be in such form and contain such information as is required bythe commissioner and shall include certified copies of the following documents:

      (1)   The written action taken by the board of directors of the bank approvingthe proposed trust branch bank or the relocation of an existing trust branchbank;

      (2)   all other required regulatory approvals; and

      (3)   an affidavit of publication of notice of intent to file an applicationto establish or operate a trust branch bank or relocate an existing trustbranch bank. The publication of the notice shall be on the same day for twoconsecutive weeks in the official newspaper of the city or county where theproposed trust branch bank is to be located. The notice shall be in the formprescribed by the commissioner and shall contain the name of the applicant, thelocation of the proposed trust branch bank, the proposed date of filing of theapplication with the commissioner, a solicitation for written commentsconcerning the application and a notice of the public's right to file a writtenrequest for a public hearing for the purpose of presenting oral or writtenevidence regarding the proposed trust branch bank. All comments and requestsfor public hearing shall be filed with the commissioner on or before the 30thday after the date the application is filed.

      (e)   A bank making application to the commissioner for approval of a trustbranch bank pursuant to this section shall pay to the commissioner a fee, in anamount established by rules and regulations of the commissioner, adoptedpursuant to K.S.A. 9-1713, and amendments thereto, to defray theexpenses of thecommissioner or designee in the examination and investigation of theapplication. The commissioner shall remit all amounts received under thissection to the state treasurer inaccordance withthe provisions of K.S.A. 75-4215, and amendments thereto. Upon receipt of eachsuchremittance, the state treasurer shall deposit the entire amount in thestate treasury to the credit of a separate accountin the state treasury for each application. The moneys in each such accountshall be used to pay the expenses of the commissioner or designee in theexamination and investigation of the application to which it relates and anyunused balance shall be transferred to the bank commissioner fee fund.

      (f)   Upon the filing of any such application with the commissioner, thecommissioner shall make or cause to be made, a careful examination andinvestigation concerning:

      (1)   The reasonable probability of usefulness and success of the proposedtrust branch bank;

      (2)   the applicant bank's financial history and condition including thecharacter, qualifications and experience of the officers employed by the bank;and

      (3)   whether the proposed trust branch bank can be established without undueinjury to properly conducted existing banks, national banking associations andtrust companies.

      If the commissioner determines any of such mattersunfavorably to the applicants, the application shall be disapproved, but ifnot, the application shall be approved.

      (g)   If no written request for public hearing is filed, the commissionershall render approval or disapproval of the application within 60 days afterthe date upon which the application was filed.

      (h)   If a written request for public hearing is filed, the commissioner shallhold a public hearing in a location determined by the commissioner within30 days of the close of the comment period. Notice of the time, date and placeof such hearing shall be published, by the applicant, in a newspaper of generalcirculation in the county where the proposed trust branch bank is to belocated, not less than 10 or more than 30 days prior to the date of thehearing, and an affidavit of publication shall be filed with the commissioner. At any such hearing, all interested persons shall be allowed to present writtenand oral evidence to the commissioner in support of or in opposition to theapplication. Upon completion of a transcript of the testimony given at suchhearing, the transcript shall be filed in the office of the commissioner. Within 14 days after the public hearing, the commissioner shall approve ordisapprove the application after consideration of the application and evidencegathered during the commissioner's investigation.

      (i)   The commissioner may extend the period for approval or disapproval ifthe commissioner determines that any information required by this section hasnot been furnished, any material information submitted is inaccurate oradditional investigation is required. The commissioner, prior to expiration ofthe application period provided in this section, shall give written notice tothe applicant of the commissioner's intent to extend the period. Such noticeshall include a specific date for expiration of the extension period. If anyinformation remains incomplete or inaccurate upon the expiration of theextension period the application shall be disapproved.

      (j)   Within 15 days after the date of the commissioner's approval ordisapproval of the application, the applicant or any individual or corporationwho filed a request for and presented evidence at the public hearing shall havethe right to appeal in writing to the state banking board the commissioner'sdetermination by filing a notice of appeal with the commissioner. The boardshall fix a date for a hearing, which hearing shall be held within 45 days fromthe date the notice of appeal is filed. The board shall conduct the hearingin accordance with the provisions of the Kansas administrative procedure actand render its decision affirming or rescinding the determination of thecommissioner. Any action of the board pursuant to this section is subject toreview in accordance with the act for judicial review and civil enforcement ofagency actions. Any party which files an appeal of the commissioner'sdetermination to the board shall pay to the commissioner a fee in an amountestablished by rules and regulations of the commissioner, adopted pursuant toK.S.A. 9-1713, and amendments thereto, to defray the board's expensesassociatedwith the conduct of the appeal.

      (k)   When the commissioner determines that any bank domiciled in this statehas established or is operating a trust branch bank in violation of the lawsgoverning the operation of such bank, the commissioner shall give writtennotice to the bank of such determination. Within 15 days after receipt of suchnotification, the bank shall have the right to appeal in writing to the boardthe commissioner's determination. The board shall fix a date for hearing,which hearing shall be held within 45 days after the date of such appeal andshall be conducted in accordance with the provisions of the Kansasadministrative procedure act. At such hearing the board shall hear all mattersrelevant to the commissioner's determination and shall approve or disapprovethe commissioner's determination, and the decision of the board shall be finaland conclusive. If the bank does not appeal to the board from thecommissioner's determination or if an appeal is made and the commissioner'sdetermination is upheld by the board, the commissioner may proceed as providedin K.S.A. 9-1714, and amendments thereto, until such time as thecommissionerdetermines the bank is in full compliance with the laws governing the operationof a trust branch bank.

      History:   L. 1994, ch. 51, § 4;L. 2001, ch. 5, § 42; July 1.