Chapter 4Bank Offices

Section § 1070

Explanation

This section outlines specific definitions related to banking operations. An "automated teller machine" is a device used for bank transactions directly between the bank and its customers. A "branch office" is where various banking activities, except ATM transactions and check-related device interactions, occur. "Core banking business" involves essential banking activities like receiving deposits and making loans, while "noncore banking business" includes permissible banking activities outside of core operations. A "facility" handles noncore business activities. The "head office" is the bank's headquarters. "Redesignate offices" refers to moving a bank's main or branch office to another branch or facility and setting up a new office at the old location. "Office" collectively refers to the bank's head, branch, or facility offices.

For purposes of this chapter, the following definitions apply:
(a)CA Financial Code § 1070(a) “Automated teller machine” means any electronic information processing device used by a financial institution and its customers for the primary purpose of executing transactions solely between the financial institution and its customers, if the transactions are not incidental to sales between the customer and a business entity other than a financial institution.
(b)CA Financial Code § 1070(b) “Branch office” means any office at which core banking business is conducted other than an automated teller machine, a device used to facilitate check guarantee or check authorization, or a remote service facility as defined in subsection (d) of Section 345.12 of Title 12 of the Code of Federal Regulations.
(c)CA Financial Code § 1070(c) “Core banking business” means the business of receiving deposits, paying checks, making loans, and other activities that the commissioner may specify by order or regulation. “Core banking business,” when used to describe the trust business, includes receiving fiduciary assets and administering fiduciary accounts.
(d)CA Financial Code § 1070(d) “Facility,” means an office at which a bank engages in noncore banking business but at which it does not engage in core banking business.
(e)CA Financial Code § 1070(e) “Head office” means the office designated by the bank as its headquarters.
(f)CA Financial Code § 1070(f) “Noncore banking business” means all activities permissible for banks, except core banking business, and except those activities prohibited by law or determined by the commissioner by regulation or order not to be noncore banking business.
(g)CA Financial Code § 1070(g) “Office” means the head office, any branch office, and any facility office of a bank.
(h)CA Financial Code § 1070(h) “Redesignate offices” means (1) the relocation by a bank of its head office to the site of a branch or facility office in this state and the concurrent establishment by the bank of an office at the former site of the head office, or (2) the relocation by a bank of a branch office to the site of a facility office and the concurrent establishment by the bank of a branch or facility office at the former site of the branch office.
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(Amended by Stats. 2015, Ch. 190, Sec. 33. (AB 1517) Effective January 1, 2016.)

Section § 1071

Explanation

This section requires a bank to obtain a certificate from the commissioner to open and run an office. The bank must pay a $25 fee for each certificate issued.

The commissioner shall issue a certificate in duplicate authorizing a bank to establish and maintain an office. A bank shall pay a fee of twenty-five dollars ($25) for every certificate the commissioner issues pursuant to this section.
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(Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)

Section § 1072

Explanation

This law requires every bank to have a head office located within the state of California.

Every bank shall establish and maintain a head office which shall be located in this state.
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(Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)

Section § 1073

Explanation

Banks can set up and manage multiple offices, but they need to get approval from their board of directors first.

A bank, with the approval of its board, may establish and maintain one or more offices.
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(Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)

Section § 1074

Explanation

This law says that a bank can move its office to a new location, but it needs its board's approval to do so.

A bank, with the approval of its board, may relocate an office.
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(Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)

Section § 1075

Explanation

This law allows a bank to change the designation or name of its offices as long as it gets the approval from its board of directors first.

A bank, with the approval of its board, may redesignate offices.
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(Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)

Section § 1076

Explanation

This law requires that whenever a bank sets up a new office, moves one, or changes its designation, it must notify the commissioner within 10 days. This notification needs to include what type of office it is, the complete address, any previous addresses if the office is relocating, the date these changes occurred, and the payment of a specified fee for the necessary certificates.

Each time a bank establishes an office, relocates an office, or redesignates an office, the bank shall, within 10 days of the establishment, relocation, or redesignation of the offices, file a notice with the commissioner. The notice shall include:
(a)CA Financial Code § 1076(a) The type of office or offices to be established, relocated, or redesignated.
(b)CA Financial Code § 1076(b) The complete address of the office or offices to be established, relocated, or redesignated. If an office is being relocated, the old address of the office and the address at which the office will be relocated.
(c)CA Financial Code § 1076(c) The date the office or offices were established, relocated, or redesignated.
(d)CA Financial Code § 1076(d) The appropriate fee for the certificate or certificates to be issued by the commissioner.
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(Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)

Section § 1077

Explanation

Every year before January 1st, banks must provide the commissioner with a list of all their current offices. The report should include the type and complete address of each office.

On or before January 1 of each year, every bank shall file with the commissioner a list of all offices that are currently maintained and operated by the bank. The report shall designate the type of each office that is being maintained and operated, and the complete address of each office.
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(Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)

Section § 1078

Explanation

This law specifies the process a bank in California must follow to close or stop running a branch office. First, the bank must inform the commissioner by filing a notice with detailed reasons and information about the closure. This includes the branch's name, location, relocation details, date for closing, reasons for closure, and supporting statistics. Additionally, the commissioner has 60 days to object to the closure; otherwise, the move can proceed if no objection is issued. Lastly, the commissioner decides based on whether the closure negatively impacts public convenience or advantage, unless safety and soundness require the branch to be closed.

(a)CA Financial Code § 1078(a) A bank may close or discontinue the operation of any branch office if, before the closing or discontinuance, (1) the bank files with the commissioner a notice containing the information in subdivision (b), and (2) the commissioner within 60 days after the filing of the notice or any longer period to which the bank consents, filing of the notice or any longer period to which the bank consents, either (A) issues a written statement not objecting to the notice, or (B) does not issue a written objection to the notice.
(b)Copy CA Financial Code § 1078(b)
(1)Copy CA Financial Code § 1078(b)(1) A notice filed under subdivision (a) shall contain all of the following information:
(A)CA Financial Code § 1078(b)(1)(A) The name of the California state bank.
(B)CA Financial Code § 1078(b)(1)(B) The location of the branch office proposed to be closed or discontinued.
(C)CA Financial Code § 1078(b)(1)(C) The location of the office to which the business of the branch office proposed to be closed or discontinued is proposed to be transferred.
(D)CA Financial Code § 1078(b)(1)(D) The proposed date of closing or discontinuance.
(E)CA Financial Code § 1078(b)(1)(E) A detailed statement of the reasons for the decision to close the branch office.
(F)CA Financial Code § 1078(b)(1)(F) Statistical or other information in support of the reasons consistent with the institution’s written policy for branch office closings.
(G)CA Financial Code § 1078(b)(1)(G) Any other information that the commissioner may require.
(2)CA Financial Code § 1078(b)(2) A notice filed under subdivision (a) shall be in the form, shall be signed in the manner, and shall, if the commissioner requires, be verified in the manner that the commissioner may require.
(c)CA Financial Code § 1078(c) For purposes of subdivision (a), a notice is deemed to be filed with the commissioner at the time when the complete notice, including any amendments or supplements, containing all the information required by the commissioner, and otherwise complying with subdivision (b), is received by the commissioner.
(d)CA Financial Code § 1078(d) In determining whether or not to object to a notice filed under subdivision (a), except if the commissioner finds that it is necessary in the interests of safety and soundness that the branch office be closed or discontinued, the commissioner shall consider whether the closing or discontinuance of the branch office will have a seriously adverse effect on the public convenience or advantage.
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(Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)

Section § 1079

Explanation

This law allows the commissioner to stop a bank from setting up, moving, or changing the designation of an office if it might be unsafe or unsound for the bank. The commissioner can require the bank to get approval first and can also impose any additional rules or conditions deemed necessary.

If the commissioner finds for any reason that the establishment, relocation, or redesignation of office would be unsafe or unsound for a bank, the commissioner may order the bank not to establish, relocate, or redesignate offices without the prior approval of the commissioner. The order may contain any other restrictions and conditions as the commissioner deems necessary.
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(Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)

Section § 1080

Explanation

If a bank ignores any rules in this chapter or doesn't follow an order, the commissioner can impose a penalty on the bank based on Section 329.

If a bank violates any provision of this chapter or fails to comply with any order, the commissioner may levy a penalty against the bank pursuant to Section 329.
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(Amended by Stats. 2013, Ch. 334, Sec. 34. (SB 537) Effective January 1, 2014.)

Section § 1081

Explanation

This law allows a bank to close one of its facility offices if its board approves. Once the closure happens, the bank must notify the commissioner within 10 days and include specific information as required by another section (Section 1076). There's no charge for filing this discontinuance notice.

A bank, with the approval of its board, may discontinue a facility office. Within 10 days of the date of the closure of the facility office, the bank shall file a notice of that discontinuance with the commissioner. The notice shall contain the information required by Section 1076. There shall be no fee associated with the discontinuance of a facility office.
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(Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)

Section § 1082

Explanation

This law requires banks that open a new branch in California to notify the state commissioner within 10 days of opening, moving, or renaming a branch. They must provide specific details including the bank's name, where it is incorporated, the branch's full address, the opening date, and any other information the commissioner asks for.

Any bank that establishes a branch office in this state in accordance with Section 36(g)(1)(A) of the National Bank Act (12 U.S.C. Sec. 36(g)(1)(A)), or Section 18(d)(4)(A)(i) of the Federal Deposit Insurance Act (12 U.S.C. Sec. 1828(d)(4)(A)(i)), as those sections were amended by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, shall, within 10 days of the establishment, relocation, or redesignation of the offices, file a notice with the commissioner that includes all of the following:
(a)CA Financial Code § 1082(a) The name of the bank establishing the branch office or offices.
(b)CA Financial Code § 1082(b) The home state or state of incorporation of the bank establishing the branch office or offices.
(c)CA Financial Code § 1082(c) The complete address of the office or offices established or to be established.
(d)CA Financial Code § 1082(d) The date the branch office or offices were or will be opened.
(e)CA Financial Code § 1082(e) Any other information, if any, that the commissioner deems necessary.
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(Added by Stats. 2011, Ch. 243, Sec. 3. (SB 664) Effective January 1, 2012.)

Section § 1083

Explanation

This law allows banks to run financial education programs at schools without those sites being considered official bank branches. To qualify, banks must not set up or operate the school venue, employees can only work there for the program, the school must allow the program at its discretion, and the primary goal must be education, like teaching financial management. The bank cannot serve the public there, and must ensure all activities follow safe banking practices. Importantly, the bank is still responsible for any deposits made at these school-based sites as if they were made at a regular branch.

(a)CA Financial Code § 1083(a) A bank may participate in a financial education program that involves receiving deposits or paying withdrawals on the premises of, or at a facility used by, a school. The school premises or facility will not be considered a branch office of the bank, as that term is defined in Section 1070 of the Financial Code, if all of the following conditions are met:
(1)CA Financial Code § 1083(a)(1) The bank does not establish and operate the school premises or facility in which the program is conducted.
(2)CA Financial Code § 1083(a)(2) Bank employees work at the site only to participate in the program.
(3)CA Financial Code § 1083(a)(3) The program is provided at the discretion of the school.
(4)CA Financial Code § 1083(a)(4) The principal purpose of the program is financial education. For example, a program is educational if it is designed to teach students the principles of personal financial management, banking operations, or the benefits of saving for the future, and is not designed for the purpose of profitmaking.
(5)CA Financial Code § 1083(a)(5) No services are provided to the general public.
(6)CA Financial Code § 1083(a)(6) The program is conducted in a manner that is consistent with safe and sound banking practices and complies with applicable law.
(b)CA Financial Code § 1083(b) A bank that participates in a financial education program pursuant to this section shall be liable for all deposits made on the premises of, or at a facility used by, a school as if the deposit was made directly at a branch office of the bank.
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(Added by Stats. 2016, Ch. 180, Sec. 1. (AB 1784) Effective January 1, 2017.)