Chapter 221

221.0302 221.0302 Branch banks and other facilities.

221.0302(1g) (1g) Definitions. In this section:

221.0302(1g)(a) (a) “Affiliate” means any company that directly or indirectly controls, or is under common control with, another company.

221.0302(1g)(b) (b) “Bank holding company” has the meaning given in 12 USC 1841 (a).

221.0302(1g)(c) (c) “Commercial activities” means those activities in which a bank holding company, financial holding company, national bank, state bank, as defined in s. 221.0903 (1) (e), or state bank certified under ch. 222 as a universal bank are not authorized to engage under federal or state law.

221.0302(1g)(d) (d) “Company” has the meaning given in s. 221.0901 (2) (f).

221.0302(1g)(e) (e) “Financial holding company” has the meaning given in 12 USC 1841 (p).

221.0302(1m) (1m) Establishment. A bank may establish and maintain a branch bank or joint branch bank with the approval of the division.

221.0302(2) (2) Conversion. A bank may be converted to a branch bank of the surviving bank of a merger or consolidation under s. 221.0702. A branch of a bank converted into a branch bank becomes a branch of the surviving bank.

221.0302(3) (3) Transfer. A bank may transfer a branch bank to any other bank located in this state with the approval of the division. A bank may transfer a branch bank to a bank located in another state only if the division has determined under s. 221.0904 (3) (b) that the state’s laws are reciprocal regarding establishing branches.

221.0302(4) (4) Out-of-state branches. A bank may establish a branch bank in another state with the approval of the division.

221.0302(5) (5) Activities not considered branch banking. The following activities do not constitute the establishment or maintenance of a branch bank or a joint branch bank:

221.0302(5)(a) (a) Picking up deposits and delivering money to bank customers at locations designated by the bank.

221.0302(5)(b) (b) Establishing or maintaining a facility under s. 221.0301 (7).

221.0302(5)(c) (c) Acting as an agent, or having another bank act as agent, under s. 221.0301 (8).

221.0302(5)(d) (d) Operating a trust service office under s. 221.0316 (4).

221.0302(6) (6) Application. A bank shall apply for the establishment or transfer of a branch bank under this section to the division on a form furnished by the division. The application shall be accompanied by a fee determined by the division.

221.0302(7) (7) Standards for approval.

221.0302(7)(a) (a) General. Except as provided in par. (b), the division shall approve the establishment of a branch bank under sub. (1m) or the conversion of a bank to a branch bank under sub. (2) if the financial and managerial resources and future prospects of the bank establishing a branch bank, or the surviving bank of a merger or consolidation, are satisfactory to the division.

221.0302(7)(b) (b) Location restrictions; certification of compliance. The division may not approve the establishment of a branch bank under sub. (1m), the conversion of a bank to a branch bank under sub. (2), or the transfer of a branch bank under sub. (3) if the establishment, conversion, or transfer would violate sub. (8m). Each bank shall certify to the division that the location of a branch bank complies with sub. (8m).

221.0302(8) (8) Applicability of laws and rules governing banks. Branch banks are subject to all laws and rules applicable to banks generally.

221.0302(8m) (8m) Location restrictions for branch banks. Except as provided in sub. (10) (b), no bank may directly or indirectly establish or maintain in this state a branch bank that is located within a 1.5-mile radius of premises or property owned, leased, or otherwise controlled, directly or indirectly, by an affiliate of the bank that engages in commercial activities. No bank may circumvent the prohibition in this subsection by first establishing a branch bank and then locating, or attempting to influence or facilitate the location of, an office of the bank’s affiliate engaged in commercial activities within a 1.5-mile radius of the location of the branch bank.

221.0302(9) (9) Closure of branch banks. At least 30 days before closing a branch bank, a bank shall notify the division in writing and post a notice of the closing in the lobby of the bank and the lobby of the branch bank to be closed.

221.0302(10) (10) Exemptions.

221.0302(10)(a) (a) Grandfathered branch banks. Every branch bank, branch office, or bank station existing on August 1, 1989, is considered to be a branch bank approved by the division under this paragraph.

221.0302(10)(b) (b) Exemption from location restrictions. Subsections (7) (b) and (8m) do not apply to any bank branch approved by the division on or before April 2, 2008.

221.0302 History History: 1995 a. 336; 1997 a. 146; 2005 a. 217; 2007 a. 112.

221.0302 Cross-reference Cross-reference: See also ch. DFI-Bkg 8, Wis. adm. code.

221.0303 221.0303 Customer bank communications terminals.

221.0303(1) (1) Definition. In this section, “customer bank communications terminal” means a terminal or other facility or installation, attended or unattended, that is not located at the principal place of business or at a branch or remote facility of a bank and through which customers and banks may engage, by means of either the direct transmission of electronic impulses to and from a bank or the recording of electronic impulses or other indicia of a transaction for delayed transmission to a bank, in transactions which are incidental to the conduct of the business of banking and which are otherwise permitted by law. “Customer bank communications terminal” also includes all equipment, regardless of location, which is interconnected with a customer bank communications terminal and which is necessary to transmit, route and process electronic impulses in order to enable the customer bank communications terminal to perform any function for which it is designed.

221.0303(2) (2) Operation and acquisition of customer bank communications terminals. A bank may, directly or indirectly, acquire, place, and operate, or participate in the acquisition, placement, and operation of, at locations other than its main or branch offices, customer bank communications terminals, in accordance with rules established by the division. The rules of the division shall provide that any such customer bank communications terminal shall be available for use, on a nondiscriminatory basis, by any state or national bank and by all customers designated by a bank using the terminal. This subsection does not authorize a bank which has its principal place of business outside this state to conduct banking business in this state. The customer bank communications terminals also shall be available for use, on a nondiscriminatory basis, by any credit union, savings and loan association, or savings bank, if the credit union, savings and loan association, or savings bank requests to share its use, subject to rules jointly established by the division of banking and the office of credit unions.

221.0303(3) (3) Terminals owned or operated by retailers. If a person who is primarily engaged in the retail sale of goods or services owns or operates a customer bank communications terminal on the person’s premises and allows access to the terminal by any financial institution, group of financial institutions, or their customers for any purpose or function, then all of the following apply:

221.0303(3)(a) (a) The division may not require the person to accept any connection to or use of the customer bank communications terminal on its premises for any other purpose or function, or to accept any connection to the terminal on its premises by any other financial institution.

221.0303(3)(b) (b) This chapter, and the rules promulgated by the division, do not apply to the person, except for laws or rules directly related to the particular function performed by the terminal on such person’s premises for a financial institution.

221.0303(4) (4) Use of transmitted information. Information transmitted from a customer bank communications terminal, either identified as to particular transactions or aggregate information, may be used only for purposes of effecting the financial transactions for which the information was received, for any other purpose lawfully authorized by contract or for any other purpose permitted by statute or rules pertaining to the dissemination and disclosure of such information.

221.0303 History History: 1995 a. 336; 1997 a. 27; 1999 a. 9; 2003 a. 33; 2021 a. 240 s. 30; 2023 a. 128.

221.0303 Cross-reference Cross-reference: See also s. DFI-Bkg 14.02, Wis. adm. code.

221.0304 221.0304 Safe deposits. A bank may take and receive personal property from any person for safekeeping and storage and may rent out the use of safes or other receptacles upon its premises upon such compensation as may be agreed upon. The bank has a lien for its charges on any property taken or received by it for safekeeping. If the lien is not paid within 2 years after the date the charges accrue, or if the property taken or received by the bank is not called for within 2 years after the date the charges accrue, the bank may sell the property at public auction. The bank shall provide such notice as is required for the sale of personal property on execution. After retaining from the proceeds of such sale all the liens and charges due the bank and the reasonable expenses of the sale, the bank shall pay the balance to the person who deposited the property, or to the person’s legal representatives or assignees.

221.0304 History History: 1995 a. 336.

221.0305 221.0305 Memberships and investments in federal reserve bank. A bank may purchase and hold, for the purpose of becoming a member of the federal reserve bank, so much of the capital stock of the federal reserve bank as will qualify it for membership under 12 USC 321 to 339 in the federal reserve bank. The bank may become a member of the federal reserve bank, and may have and exercise all powers, not in conflict with the laws of this state, that are conferred upon a member bank. The member bank and its directors, officers and shareholders remain subject to all liabilities and duties imposed upon them by the laws of this state.

221.0305 History History: 1995 a. 336.

221.0306 221.0306 Memberships and investments in federal home loan bank.

221.0306(1) (1) Permitted activities. Subject to review by the division under sub. (2), a bank may, with the approval of its board of directors, purchase and hold capital stock of the federal home loan bank for the purpose of becoming a member of the federal home loan bank under 12 USC 1421 to 1449. A bank that becomes a member may exercise borrowing privileges or use any other services offered to a member by the federal home loan bank, if the privileges or services are not in conflict with the laws of this state. Without becoming a member, a bank may exercise deposit privileges and use other services offered to nonmembers by the federal home loan bank.

221.0306(2) (2) Notice and review. A bank that intends to become a member of the federal home loan bank shall give the division written notice of its intention to apply for membership. The division may prohibit a bank from becoming a member if the bank’s capital and undistributed surplus is less than the amount required for that bank or if the division finds that the bank is in an unsafe or unsound condition. The division shall have 30 days after the date on which the notice is received to issue a prohibition under this subsection. The division may extend the time for issuing a prohibition up to 30 additional days if the division notifies the bank before the initial 30-day period expires that the division is extending the time limit.

221.0306 History History: 1995 a. 336.

221.0307 221.0307 Memberships and investments in other state and federal agencies. A bank may, with the approval of the division and by action of the bank’s board of directors, acquire and hold the stock of any state or federal agency or of any similar institution approved by the division. A bank that intends to make such an investment shall give the division written notice of its intention. The division may disallow the investment if it finds that the bank is in an unsafe or unsound condition or that the transaction would be an unsafe or unsound investment for the bank. The division shall have 30 days after the date on which notice is received to issue a prohibition under this section. The division may extend the time for issuing the prohibition to 30 additional days if the division notifies the bank before the initial 30-day period expires that the division is extending the time limit.

221.0307 History History: 1995 a. 336.

221.0308 221.0308 Benefits under federal law; Federal Deposit Insurance Corporation. A bank may, by action of its board of directors, enter into such contracts, incur such obligations and perform such acts as may be necessary or appropriate in order to take advantage of any and all memberships, loans, subscriptions, contracts, grants, rights or privileges that may at any time be available or inure to banking institutions or to their depositors, creditors, shareholders, conservators, receivers or liquidators, by virtue of any federal law establishing the Federal Deposit Insurance Corporation; providing for the insurance of deposits; or regulating or safeguarding banking institutions and their depositors. A bank may also subscribe for and acquire any stock, debenture, bond or other type of security of the Federal Deposit Insurance Corporation. A bank that becomes a member of the Federal Deposit Insurance Corporation shall comply with the lawful regulations and requirements issued by the Federal Deposit Insurance Corporation. The bank and its directors, officers and shareholders shall continue to be subject to all liabilities and duties imposed upon them by any laws of this state.

221.0308 History History: 1995 a. 336.

221.0309 221.0309 Investments in international banking and financial institutions. A bank may, with the approval of the division, invest an amount not exceeding in the aggregate 15 percent of its capital in one or more corporations principally engaged in international or foreign banking, or banking in dependencies or insular possessions of the United States, organized pursuant to 12 USC 611 to 631. A bank may also invest, with the approval of the division, an amount not exceeding in the aggregate 10 percent of its capital in the stock of one or more corporations principally engaged in international or foreign financial operations other than banking, as well as such financial operations in dependencies or insular possessions of the United States, organized pursuant to 12 USC 611 to 631.

221.0309 History History: 1995 a. 336.

221.0310 221.0310 Federal National Mortgage Association. A bank that has loans secured by real estate mortgages may, with the approval of the division, sell all or any portion of the loans to the Federal National Mortgage Association, or any successor to that association. In connection with this sale of loans, the bank may make payments of any required capital contributions in the nature of subscriptions for stock of the Federal National Mortgage Association or any successor to that association, may receive stock evidencing these capital contributions and may hold or dispose of this stock.

221.0310 History History: 1995 a. 336.

221.0311 221.0311 Investments in agricultural credit corporations. A bank may invest, with the approval of the division, in an agricultural credit corporation. Unless a bank owns at least 80 percent of the stock of the agricultural credit corporation, the amount invested by the bank may not exceed 20 percent of the bank’s capital.

221.0311 History History: 1995 a. 336.

221.0312 221.0312 Investments in development companies. A bank is authorized to invest, in an amount not to exceed in the aggregate 5 percent of its capital, in shares of the Wisconsin Development Credit Corporation and in shares of small business investment companies located in this state.

221.0312 History History: 1995 a. 336.

221.0313 221.0313 Information to division; stock holdings. A bank that invests in the capital stock of other banks or of corporations as provided in this chapter shall furnish information concerning the condition of the other banks or corporations to the division upon demand. If the division determines that the bank is not complying with rules of the division regarding these investments, the division may institute an investigation of the bank’s investments. If the investigation establishes a violation of division rules regarding permissible investments, the division may require the bank to dispose of its investment in the other bank or corporation, upon reasonable notice.

221.0313 History History: 1995 a. 336.

221.0314 221.0314 Sale of U.S. bonds. A bank may, by resolution of its board of directors authorizing such action, act as agent for the U.S. treasury or other instrumentality of the United States in connection with the sale of bonds or other obligations of the United States or an instrumentality of the United States, if designated as agent by the secretary of the U.S. treasury or by the other instrumentality. A bank may enter into contracts, incur obligations, make investments, pledge assets or take other actions if necessary or appropriate in order to act as agent under this section. A bank may exercise powers granted under this section only upon express approval previously granted by the division, and only in such manner and to such extent as the division may approve, and with such limitations upon the exercise of those powers as the division may impose.

221.0314 History History: 1995 a. 336.

221.0315 221.0315 Insurance activities.

221.0315(1) (1) Insurance intermediary activities permitted. A bank, or an officer or salaried employee of a bank, may obtain a license as an insurance intermediary, if otherwise qualified.

221.0315(2) (2) Insurance underwriting prohibited. A bank may not, directly or through a subsidiary, engage in the business of underwriting insurance.

221.0315 History History: 1995 a. 336.

221.0316 221.0316 Trust powers.

221.0316(1) (1) General. When authorized by the division, and after the bank has in good faith complied with all requirements of law and fulfilled all the conditions precedent to the exercise of trust powers imposed by law upon trust company banks, a bank may act as trustee, personal representative, registrar of stocks and bonds, guardian of estates, assignee, receiver, and in any other fiduciary capacity in which trust company banks are permitted to act. A bank authorized by the division to exercise trust powers under this section shall comply with s. 223.02 before exercising such authority. Upon compliance with s. 223.02, the bank is entitled to the same exemption as to making and filing any oath or giving any bond or security as is conferred on trust company banks by s. 223.03 (6) (a).

221.0316(2) (2) Application and approval.

221.0316(2)(a) (a) With its application for permission to exercise trust powers under this section, a bank shall submit to the division a fee determined by the division.

221.0316(2)(b) (b) In approving an application by a bank to exercise trust powers, the division may take into consideration the amount of capital of the applying bank, whether the capital is sufficient under the circumstances, the needs of the community to be served, and any other facts and circumstances that may be material. The division shall approve or disapprove the application within 6 months after the date on which the application is filed. The division may approve an application under this subsection if the division is satisfied that the bank has in good faith complied with all the requirements of law and has fulfilled all the conditions precedent to the exercise of these powers imposed by law.

221.0316(2)(c) (c) If the division approves the application, the division shall issue, in duplicate, a special authorization certificate to the bank. The certificate shall state that the bank has complied with the provisions of law applicable to banks exercising trust powers and that the bank is authorized to exercise trust powers. One of the duplicate special authorization certificates shall be transmitted by the division to the bank and the other shall be filed with the division.

221.0316(2)(d) (d) In exercising trust powers, a bank shall comply with all the provisions of law applicable to individuals acting in a trust or fiduciary capacity.

221.0316(3) (3) Trust Funds; how kept.

221.0316(3)(a) (a) In this subsection, “affiliated bank” means, with respect to a bank exercising trust powers, any bank that directly or indirectly controls, or is directly or indirectly controlled by, or is under common control with, the bank exercising trust powers.

221.0316(3)(b) (b) A bank that exercises trust powers shall keep its trust accounts in books separate from its other books of account. All funds and property held by the bank in a trust capacity shall, at all times, be kept separate from the other funds and property of the bank, except that uninvested trust funds may be deposited in an account in the bank or in any other bank, including an affiliated bank, that is a member of the Federal Deposit Insurance Corporation. All deposits of uninvested trust funds shall be deposited as trust funds to its credit as trustee. In the event of insolvency or liquidation of a bank in which the accounts are maintained, all bank accounts comprising trust funds so deposited have preference and priority in all assets of the bank over the bank’s general creditors, without the necessity of tracing or identifying the trust funds.

221.0316(4) (4) Trust service offices. A state bank exercising trust powers may, with the approval of the division, establish and maintain a trust service office at any office of any other depository institution, as defined under s. 221.0901 (2) (i). A state bank may, with the approval of the division, permit any other depository institution, as defined under s. 221.0901 (2) (i), exercising trust powers or any trust company bank organized under ch. 223 to establish and maintain a trust service office at any of its banking offices. The establishment and operation of a trust service office are subject to s. 223.07. This subsection does not authorize branch banking.

221.0316 History History: 1995 a. 336; 1997 a. 138; 2001 a. 102; 2005 a. 158.

221.0317 221.0317 Securitization of assets. A bank may, with the approval of the division, securitize its assets for sale to the public in accordance with the rules which shall be promulgated by the division under this section.

221.0317 History History: 1995 a. 336.

221.0318 221.0318 Notes and debentures.

221.0318(1) (1) Issuance. A bank may, by the action of its board of directors, issue and sell its notes or debentures of one or more classes in the amount, in the form and with the maturity determined by the board. The notes and debentures may confer such rights and privileges upon the holders of the notes and debentures as determined by the board.

221.0318(2) (2) Limitation on issuance. A bank may issue notes and debentures if the amount issued is within limits previously established by the division for issuances by the bank.

221.0318(3) (3) Status as capital of bank. Notes and debentures issued by a bank constitute capital of the bank, only if approved by the division.

221.0318(4) (4) Retirement of notes and debentures. Before a bank may retire or pay notes or debentures, any existing deficiency of the bank’s capital, disregarding the notes and debentures to be retired, must be paid in cash or in assets acceptable to the division, so that the sound capital assets of the bank shall at least equal the capital stock of the bank.

221.0318(5) (5) Liability for assessment. A bank’s notes or debentures are not subject to any assessment. The holders of these notes or debentures are not liable for the debts, contracts or engagements of the bank or for assessments to restore impairments in the capital of the bank.

221.0318 History History: 1995 a. 336.

221.0319 221.0319 Real estate.

221.0319(1) (1) Purposes for which real estate may be held. A bank may purchase, lease, hold and convey only the following types of real estate:

221.0319(1)(a) (a) Real estate necessary for the convenient transaction of its business, including facilities connected with the office, furniture, equipment and fixtures. A bank may include with its banking offices, other facilities to rent as a source of income. A bank may also invest in the stocks, bonds or obligations of a bank building corporation. A bank’s investment under this paragraph or its liability for it may not exceed in the aggregate 60 percent of the bank’s capital.