SCS/HCS/HBs 63, 73 & 34 - This act modifies Chapters 361, 362, 369, and 443, RSMo, and contains provisions for banks, credit unions, other financial organizations, and for reverse mortgages.

Section 361.005 defines several key banking terms including "Foreign bank", "Home state", and "Out-of-state bank". Subsection 8 allows the Director of the Division of Finance to contract with out-of-state banking regulators regarding the examination of Missouri branches of out-of-state banks and branches of banks whose home state is Missouri.

Section 361.259 expands the Director's powers to apply to out-of-state banks to the same extent such powers apply to Missouri banks. Section 362.077 prohibits a bank holding company from chartering a bank, trust company, or national bank located in Missouri, as well as acquiring a bank, trust company, or national bank located in Missouri, that has been in existence for less than five years. However, the prohibitions do not apply to the creation and acquisition of an interim bank charter created to facilitate the acquisition of an existing bank or trust company via a merger so long as the acquisition and merger are completed within two years. Section 362.077 seeks to implement a portion of the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994, Public Law 103-328.

The definition of "bank" in section 362.910, RSMo, has been expanded to include "a branch of any bank, trust company or national banking association which accepts demand deposits and which has a physical presence in Missouri".

Meetings by the boards of directors of bank and trust companies may be held quarterly instead of monthly, with approval from the Director of Finance. Banks and associations may sell part or all of their business or assets to each other. Fiduciary fee limits on banks for mutual funds shall not limit other types of investments.

Credit unions shall be exempt entities under the Residual Mortgage Brokers License Act. The definition of "loan brokering" is expanded. Violations under the residual mortgage law shall not begin until one year after the Residual Mortgage Licensing Board's rules are adopted by the Joint Committee on Administrative Rules.

The definition of "exempt entity" in section 443.803 has been expanded to include credit unions. The definition of "mortgage loan" has also been expanded to include reverse mortgages secured by residential real property.

Section 443.810 places a one (1) year moratorium on the implementation of the Class C felony provisions.

New section 443.816 creates a "Residential Mortgage Board" which: 1) reviews mortgage brokering regulations; and 2) hears and determines issues pertaining to mortgage brokering and the licensing of mortgage brokers. Section 443.849 reduces the surety bond requirement from $25,000 to $20,000.

Section 443.859 requires that every residential mortgage licensee have a net worth of at least $25,000 within one year after specific rules have been properly promulgated by the Director of the Division of Finance.

Five new sections are added to regulate reverse mortgages, which are loans to homeowners, secured by the home, and which require no payments until the entire loan becomes due. Specific regulations are imposed upon: (1) payment without penalty; (2) priority over subsequent liens; (3) fixed or adjustable interest rates; (5) periodic advances; (6) a penalty for failure to make loan advances; (7) fees; and (8) communications by telephone and mail. Limitations on other types of mortgage transactions are excluded. Loan payments and undisbursed funds shall not be treated as income for public aid programs.

New section 6 states that depositary institutions may charge up to $20 for overdrafts and $15 for insufficient funds.

In addition, the act has three new sections addressing bank relocation. Section 7 details procedures for a Missouri bank or trust company to "relocate its main banking house up to 30 miles to a location in another state". These procedures include approval by the director, reciprocity with the other state, and charter or certificate of incorporation requirements.

Section 8 provides authority for an out-of-state bank to "relocate its main banking house up to 30 miles to a location in Missouri". Section 9 details the application procedures an out- of-state bank must follow in order "to relocate its main banking house to Missouri."

Any modifications this act makes to Chapter 443, RSMo, are deemed emergency measures and therefore take effect upon passage and approval. RONALD J. LEONE