Chapter DFI-SB 22

Chapter DFI-SB 22

SAVINGS BANK MUTUAL HOLDING COMPANIES

DFI-SB 22.01   Definitions.

DFI-SB 22.02   Mutual holding company reorganization.

DFI-SB 22.03   Approval of mutual holding company reorganization.

DFI-SB 22.04   Grounds for disapproval of reorganizations.

DFI-SB 22.05   Membership rights.

DFI-SB 22.06   Contents of mutual holding company reorganization plans.

DFI-SB 22.07   Stock issuance plans.

DFI-SB 22.08   Issuance or sale of stock by savings bank subsidiaries of mutual holding companies.

DFI-SB 22.09   Articles of incorporation and bylaws of mutual holding companies.

DFI-SB 22.10   Activities of mutual holding companies.

DFI-SB 22.11   Registration, reports and examinations.

DFI-SB 22.12   Conversion or liquidation of mutual holding companies.

DFI-SB 22.13   Procedural requirements for proxies.

Ch. DFI-SB 22 Note Note: Chapter SB 22 was renumbered ch. DFI-SB 22 under s. 13.93 (2m) (b) 1., Stats., and corrections made under s. 13.93 (2m) (b) 6. and 7., Stats., Register, November, 1997, No. 503.

DFI-SB 22.01 DFI-SB 22.01 Definitions. In this chapter:

DFI-SB 22.01(1) (1) “Acquiree savings bank” means any savings bank other than a resulting savings bank that:

DFI-SB 22.01(1)(a) (a) Is acquired by a mutual holding company as part of and concurrently with a mutual holding company reorganization; and

DFI-SB 22.01(1)(b) (b) Is in the mutual form immediately prior to the acquisition.

DFI-SB 22.01(2) (2) 

DFI-SB 22.01(2)(a) (a) “Acting in concert” means:

DFI-SB 22.01(2)(a)1. 1. Knowing participation in a joint activity or interdependent conscious parallel action towards a common goal whether or not pursuant to an express agreement; or

DFI-SB 22.01(2)(a)2. 2. A combination or pooling of voting or other interests in the securities of an issuer for a common purpose pursuant to any contract, understanding, relationship, agreement or other arrangement, whether written or otherwise.

DFI-SB 22.01(2)(b) (b) A person or company which acts in concert with another person or company is acting in concert with any person or company who is also acting in concert with that other party, except that a stock benefit plan is not acting in concert with its trustee or a person who serves in a similar capacity solely for the purpose of determining whether stock held by the trustee and stock held by the plan will be aggregated. No officer or director of a savings bank or savings bank affiliate is acting in concert with any other officer or director of the savings bank or affiliate by reason of his or her service in those capacities.

DFI-SB 22.01(3) (3) “Affiliate” means a person that directly or indirectly through one or more intermediaries controls, is controlled by or is under common control with another person.

DFI-SB 22.01(4) (4) “Associate”, when indicating a relationship between persons, means:

DFI-SB 22.01(4)(a) (a) Any corporation or organization, other than the applicant or a majority-owned subsidiary of the applicant, of which the person is an officer or partner or is directly or indirectly the beneficial owner of l0% or more of any class of equity securities;

DFI-SB 22.01(4)(b) (b) Any trust or other estate in which the person has a substantial beneficial interest or as to which the person serves as trustee or in a similar fiduciary capacity, except that it does not include any stock benefit plan in which a person has a substantial beneficial interest or serves as a trustee or in a similar fiduciary capacity; and

DFI-SB 22.01(4)(c) (c) Any relative by blood or marriage of the natural person, or any relative by blood or marriage of the spouse, who has the same legal residence as or shares living quarters with the person or who is a director or officer of the applicant or of any of the applicant’s parent organizations or subsidiaries.

DFI-SB 22.01(5) (5) 

DFI-SB 22.01(5)(a) (a) “Company” means any corporation, partnership, business trust, joint venture, association or similar organization or any other trust unless by its terms it must terminate within 25 years or not later than 21 years and 10 months after the death of any individual living on the effective date of the trust. “Company”does not include:

DFI-SB 22.01(5)(a)1. 1. The FDIC, FRB, or any federal home loan bank.

DFI-SB 22.01(5)(a)2. 2. Any company, the majority of shares of which is owned by:

DFI-SB 22.01(5)(a)2.a. a. The United States or any state.

DFI-SB 22.01(5)(a)2.b. b. An officer of the United States or any state acting in his or her official capacity.

DFI-SB 22.01(5)(a)2.c. c. An instrumentality of the United States or any state.

DFI-SB 22.01(5)(b) (b) “Similar organization” in par. (a) means a combination of parties with the potential for or practical likelihood of a continuing rather than temporary existence, where the parties have knowingly and voluntarily associated for a common purpose pursuant to identifiable and binding relationships which govern the parties with respect to either:

DFI-SB 22.01(5)(b)1. 1. The transferability and voting of any stock or other indicia of participation in another entity; or

DFI-SB 22.01(5)(b)2. 2. Achievement of a common or shared objective, such as to collectively manage or control another entity.

DFI-SB 22.01(6) (6) 

DFI-SB 22.01(6)(a) (a) “Control” of a savings bank means:

DFI-SB 22.01(6)(a)1. 1. Controlling, owning or having the power to vote, directly or indirectly or acting through one or more persons, 25% or more of any class of voting securities of the savings bank; or

DFI-SB 22.01(6)(a)2. 2. In any manner controlling the election of a majority of the directors of the savings bank.

DFI-SB 22.01(6)(b) (b) “Control” of a savings bank shall also exist if the division determines, after notice and opportunity for hearing, that a person directly or indirectly exercises a controlling influence over the management or policies of the savings bank.

DFI-SB 22.01(7) (7) “Default” means any adjudication or other official determination of a court or other public authority pursuant to which a conservator, receiver or other legal custodian is appointed for a mutual holding company or savings bank subsidiary of a mutual holding company.

DFI-SB 22.01(8) (8) “FDIC” means the federal deposit insurance corporation.

DFI-SB 22.01(9) (9) “FRB” means the board of governors of the federal reserve system.

DFI-SB 22.01(10) (10) “Member” means any depositor of a savings bank subsidiary of a mutual holding company that is entitled, under a statute or the articles of incorporation or bylaws of the mutual holding company, to vote on matters affecting the mutual holding company.

DFI-SB 22.01(11) (11) “Mutual holding company” means a mutual savings bank holding company organized under s. 214.095, Stats., and this chapter which has control over any savings bank or any company that is or becomes a mutual holding company by virtue of this chapter.

DFI-SB 22.01(13) (13) “Parent”, when describing the relationship between 2 companies, means the company that controls the other company, either directly or indirectly, through one or more subsidiaries.

DFI-SB 22.01(14) (14) “Person” means an individual or company.

DFI-SB 22.01(15) (15) “Reorganization plan” means a plan to reorganize into the mutual holding company format which contains the information required by s. DFI-SB 22.06.

DFI-SB 22.01(16) (16) “Reorganizing savings bank” means a mutual savings bank that proposes to reorganize into a mutual holding company under this chapter.

DFI-SB 22.01(17) (17) “Resulting savings bank” means a stock savings bank that is organized as a subsidiary of a reorganizing savings bank to receive a substantial part of the assets and liabilities, including all deposit accounts, of the reorganizing savings bank upon consummation of the reorganization.

DFI-SB 22.01(18) (18) “Savings association” means a savings association as defined in 12 USC 1813 (3) (b) (1) the deposits of which are insured by the FDIC and includes a federal savings association, federal savings bank and a building and loan or savings and loan association organized and operating under the laws of the state in which it is organized.

DFI-SB 22.01(19) (19) “Stock” means the units into which the proprietary interests of a savings bank are divided including common or preferred stock, any other type of equity security, as well as warrants or options to acquire common or preferred stock, and other securities that are convertible into common or preferred stock.

DFI-SB 22.01(20) (20) “Stock benefit plan” means any defined benefit plan or defined contribution plan and includes an employee stock ownership plan, stock bonus plan, profit-sharing plan or other plan of a mutual holding company or any of its subsidiaries or affiliates, whether or not the plan with its related trust, meets the qualifying requirements under section 401 of the internal revenue code.

DFI-SB 22.01(21) (21) “Stock issuance plan” means a plan submitted under s. DFI-SB 22.07 providing for the issuance of stock by a savings bank subsidiary of a mutual holding company.

DFI-SB 22.01(22) (22) “Subsidiary” means a company controlled either directly or indirectly by another company.

DFI-SB 22.01 Note Note: This section interprets or implements s. 214.095, Stats.

DFI-SB 22.01 History History: Cr. Register, February, 1994, No. 458, eff. 3-1-94; CR 23-039: am. (5) (a) 1., r. (12) Register March 2024 No. 819, eff. 4-1-24.

DFI-SB 22.02 DFI-SB 22.02 Mutual holding company reorganization. A mutual savings bank may, upon application to and approval by the division, reorganize as a mutual holding company by:

DFI-SB 22.02(1) (1) Organizing one or more subsidiary stock savings banks, the ownership of which shall be evidenced by shares of stock to be owned by the reorganizing parent savings bank and transferring a substantial portion of its assets and all of the insured deposits and part or all of its other liabilities to one or more subsidiary savings banks; or

DFI-SB 22.02(2) (2) Organizing a first tier subsidiary stock savings bank and causing that subsidiary to organize a second tier subsidiary stock savings bank and transferring, by merger of the reorganizing savings bank with the second tier subsidiary, a substantial portion of its assets, all of its insured deposits and part or all of its other liabilities to the resulting savings bank at which time the first tier subsidiary stock savings bank becomes a mutual holding company.

DFI-SB 22.02(3) (3) Organizing a mutual holding company with the division’s approval under s. 214.095, Stats., which organizes a subsidiary stock savings bank and transfers, by merger of the reorganizing savings bank, a substantial portion of its assets and all of its insured deposits and part or all of its other liabilities to the resulting savings bank.

DFI-SB 22.02 Note Note: This section interprets or implements s. 214.095, Stats.

DFI-SB 22.02 History History: Cr. Register, February, 1994, No. 458, eff. 3-1-94.

DFI-SB 22.03 DFI-SB 22.03 Approval of mutual holding company reorganization.

DFI-SB 22.03(1) (1) General. Prior to reorganizing into a mutual holding company, a reorganizing savings bank shall do all the following:

DFI-SB 22.03(1)(a) (a) Obtain approval of a reorganization plan by a majority of the board of directors of the reorganizing savings bank and the board of directors of any acquiree savings bank.

DFI-SB 22.03(1)(b) (b) File the reorganization plan with the division within 5 business days after the approval of the board of directors.

DFI-SB 22.03(1)(c) (c) Obtain approval of a reorganization plan by an affirmative vote of a majority of the voting members of the reorganizing savings bank and any acquiree savings bank, at a meeting of members held under its bylaws.

DFI-SB 22.03(1)(d) (d) Obtain the approval of the reorganization plan by the division and, if applicable, the FDIC or FRB.

DFI-SB 22.03(2) (2) Actions by division. A proposed reorganization shall be approved or disapproved by the division within 45 days of its filing and, if approved, shall be subject to the following conditions:

DFI-SB 22.03(2)(a) (a) The reorganization shall be consummated within one year of the approval.

DFI-SB 22.03(2)(b) (b) The capitalization of the mutual holding company shall not cause the resulting savings bank to fail to meet its capital maintenance requirement under ss. 214.40 and 214.43, Stats.

DFI-SB 22.03(2)(c) (c) Any other conditions which the division prescribes in the interests of a sound financial system.

DFI-SB 22.03(3) (3) Certificate of reorganization. If the division determines that the reorganizing savings bank has complied with all requirements of law and has implemented the reorganization plan as approved, the division shall issue a certificate of reorganization evidencing that the mutual savings bank has been reorganized into a mutual holding company and prescribing the effective date of the reorganization. The certificate shall be recorded in the office of the register of deeds in the county in which the home office of the reorganizing savings bank was located and in the county in which the registered office of the mutual holding company is located.

DFI-SB 22.03 Note Note: This section interprets or implements s. 214.095, Stats.

DFI-SB 22.03 History History: Cr. Register, February, 1994, No. 458, eff. 3-1-94; CR 23-039: am. (1) (d) Register March 2024 No. 819, eff. 4-1-24.

DFI-SB 22.04 DFI-SB 22.04 Grounds for disapproval of reorganizations.

DFI-SB 22.04(1) (1) Basic standards. The division may disapprove an application for a mutual holding company reorganization on one or more of the following grounds:

DFI-SB 22.04(1)(a) (a) Disapproval is necessary to prevent unsafe or unsound practices, or to otherwise maintain a sound financial institution.

DFI-SB 22.04(1)(b) (b) The reorganization plan is not fair to members of the reorganizing savings bank.

DFI-SB 22.04(1)(c) (c) The reorganization plan does not protect the interests of deposit account holders of the reorganizing savings bank.

DFI-SB 22.04(1)(d) (d) The financial or managerial resources of the reorganizing savings bank or any acquiree savings bank warrant disapproval.

DFI-SB 22.04(1)(e) (e) After the proposed capitalization of the mutual holding company, any savings bank subsidiary would fail to meet the requirements of ss. 214.40 and 214.43, Stats.