Chapter DFI-Bkg 18

Chapter DFI-Bkg 18

LOANS AND INVESTMENTS

DFI-Bkg 18.01   Definitions.

DFI-Bkg 18.02   Loans or investment limited.

DFI-Bkg 18.03   Procedure for determination of applicable percentage.

DFI-Bkg 18.04   Review of percentage determination and compliance with other laws.

DFI-Bkg 18.05   Notification.

DFI-Bkg 18.06   Accounting.

DFI-Bkg 18.07   Losses.

Ch. DFI-Bkg 18 Note Note: Chapter Bkg 18 was renumbered Chapter DFI-Bkg 18 under s. 13.93 (2m) (b) 1., Stats., and corrections made under s. 13.93 (2m) (b) 6. and 7., Stats., Register, June, 1997, No. 498, eff. 7-1-97.

DFI-Bkg 18.01 DFI-Bkg 18.01 Definitions. In this chapter:

DFI-Bkg 18.01(1e) (1e) “Administrator” means the administrator of the division of banking.

DFI-Bkg 18.01(1m) (1m) “Division” means the division of banking.

DFI-Bkg 18.01(1s) (1s) “Investment” means moneys advanced, directly or indirectly by a bank or its subsidiary in listed or unlisted stocks, capital notes and debentures, bonds, real estate, small business investment companies and other obligations or securities as are permitted by law or administrative rule.

DFI-Bkg 18.01(2) (2) “Security” means the interest pledged to a bank or its subsidiary for a loan. Permissible forms of security include real estate, business assets, listed and unlisted securities, cash surrender value of life insurance, limited partnerships but not as a general partner and other forms as permitted by law or administrative rule. Loans under s. 221.0321 (1), Stats., need not be secured.

DFI-Bkg 18.01(3) (3) “Subsidiary” means any business in which a parent bank owns an interest of at least 80% of the voting stock pursuant to s. DFI-Bkg 3.04.

DFI-Bkg 18.01 History History: Cr. Register, May, 1987, No. 377, eff. 6-1-87; correction in (2) made under s. 13.93 (2m) (b) 7., Stats., Register October 2001 No. 550; CR 23-039: renum. (1) to (1s), cr. (1e), (1m) Register March 2024 No. 819, eff. 4-1-24.

DFI-Bkg 18.02 DFI-Bkg 18.02 Loans or investment limited.

DFI-Bkg 18.02(1) (1) A bank or its subsidiary is limited for its aggregate loan or investment portfolio to the respective percentage established by the administrator pursuant to s. 221.0321 (3), Stats.

DFI-Bkg 18.02(2) (2) The statutory limitations with respect to officers, directors, and employees of a bank, as set forth at s. 221.0625, Stats., are applicable to and included in calculating the appropriate amounts of such officers’, directors’ or employees’ involvement, relationship, ownership or other participation through a subsidiary.

DFI-Bkg 18.02 History History: Cr. Register, May, 1987, No. 377, eff. 6-1-87; corrections made under s. 13.93 (2m) (b) 7., Stats., Register October 2001 No. 550; CR 23-039: am. Register March 2024 No. 819, eff. 4-1-24.

DFI-Bkg 18.03 DFI-Bkg 18.03 Procedure for determination of applicable percentage. Prior to lending or investing by a bank or its subsidiary pursuant to s. 221.0321, Stats., the bank or subsidiary shall request the administrator to make a determination establishing applicable percentage limitations. The administrator’s determination may include consideration of the bank’s assets, management and liquidity ratio and its capital ratio. The administrator shall report the determination to the requestor within 60 days from the date of the receipt of the request.

DFI-Bkg 18.03 History History: Cr. Register, May, 1987, No. 377, eff. 6-1-87; correction made under s. 13.93 (2m) (b) 7., Stats., Register October 2001 No. 550; CR 23-039: am. Register March 2024 No. 819, eff. 4-1-24.

DFI-Bkg 18.04 DFI-Bkg 18.04 Review of percentage determination and compliance with other laws. The administrator may review a determination made under s. DFI-Bkg 18.03 and establish, withdraw or suspend the percentage in effect after consideration of factors such as the bank’s capital, capital ratio, asset quality, management, earnings, liquidity ratio, contingent liabilities and off balance sheet risk. After any loss is reported the administrator shall have 60 days to review and establish, withdraw or suspend a percentage pursuant to s. 221.0321, Stats.

DFI-Bkg 18.04 History History: Cr. Register, May, 1987, No. 377, eff. 6-1-87; correction in (1) made under s. 13.93 (2m) (b) 7., Stats., Register October 2001 No. 550; CR 23-039: renum. (1) to DFI-Bkg 18.04 and am., r. (2) Register March 2024 No. 819, eff. 4-1-24.

DFI-Bkg 18.05 DFI-Bkg 18.05 Notification. A bank or its subsidiary shall, prior to disposition of, or withdrawal from, a loan or investment subject to this chapter, inform the administrator by letter of the terms of the transaction. The bank or its operating subsidiary shall provide a financial statement to the administrator within 90 days after the close of its fiscal year. It shall further provide the administrator a copy of all resolutions or other records of the board of directors approving any investments or loans or taking any action with regard thereto pursuant to s. 221.0321, Stats.

DFI-Bkg 18.05 History History: Cr. Register, May, 1987, No. 377, eff. 6-1-87; correction made under s. 13.93 (2m) (b) 7., Stats., Register October 2001 No. 550; CR 23-039: am. Register March 2024 No. 819, eff. 4-1-24.

DFI-Bkg 18.06 DFI-Bkg 18.06 Accounting. A bank or its subsidiary shall follow the instructions approved for use by the division for the preparation of reports in the reports of condition and income to account for investments made pursuant to s. 221.0321, Stats.

DFI-Bkg 18.06 History History: Cr. Register, May, 1987, No. 377, eff. 6-1-87; correction made under s. 13.93 (2m) (b) 7., Stats., Register October 2001 No. 550; CR 23-039: am. Register March 2024 No. 819, eff. 4-1-24.

DFI-Bkg 18.07 DFI-Bkg 18.07 Losses. A bank or its subsidiary shall within 30 days report any losses incurred on loans or investments made pursuant to s. 221.0321, Stats.

DFI-Bkg 18.07 History History: Cr. Register, May, 1987, No. 377, eff. 6-1-87; correction made under s. 13.93 (2m) (b) 7., Stats., Register October 2001 No. 550; CR 23-039: am. Register March 2024 No. 819, eff. 4-1-24.