Sec. 06.05.468. Department takeover.

442 words·~2 min read·/ak/title-6/chapter-5/06-05-468

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

(a)A state bank may be closed and the department may take possession of the bank if the bank voluntarily places its affairs and assets under the department's control, or if the department finds

(1)the bank has violated an order of the department;

(2)the bank has violated a provision of this chapter or a regulation of the department adopted under this chapter;

(3)the bank's capital is impaired or the bank is otherwise in an unsafe or unsound condition;

(4)the bank's business is being conducted in an unlawful, unsafe, or unsound manner;

(5)the bank is insolvent;

(6)the bank is unable to continue normal operations;

(7)a department examination of the bank is obstructed or impeded;

(8)the bank holding company that controls the bank refuses to permit an examination as provided in AS 06.05.235 ; or

(9)the bank has lost, or received notice of the termination or suspension of, its membership in the Federal Deposit Insurance Corporation or has relinquished its membership in the Federal Deposit Insurance Corporation without the consent of the department.

(b)Except as provided in

(d)of this section, before the department may take possession of a bank the department shall issue a notice to the board of directors of the bank under AS 06.01.030

(a)of the problems identified by the department and issue an order to the board under AS 06.01.030

(b)to correct the problems. The notice must also specify that failure to comply with the order may result in the department taking possession of the bank.

(c)If a bank fails to comply with an order issued under

(b)of this section, the department may take possession of the bank by posting upon the bank premises a notice stating that the department is assuming possession under this chapter. Department possession begins when the notice is posted. The notice shall also be filed in the superior court of the judicial district in which the bank is located. The department shall notify the local federal reserve bank if the bank is a member of the Federal Reserve System.

(d)Notwithstanding the provisions of this section and AS 06.01.030 , if, in the opinion of the department, an emergency exists that will result in serious losses to the depositors, the department may take possession of a bank without prior hearing. Within two days after the department takes possession under this subsection, an interested party may file with the department an application for an order vacating the possession. The department shall grant the application if the department finds that the department's action was not authorized under this chapter.