§ 567.13 - Obligations of acquirors of savings associations to maintain capital.

(a) Definitions. As used in this section, the following definitions apply, unless the context otherwise requires:

(1) Acquiror means a person or company that controls a savings association.

(2) Control means control as determined under § 574.4(a) or (b) of this chapter.

(3) Capital means the measure of capital used in the applicable capital maintenance obligation.

(4) Capital maintenance obligation means an obligation to maintain the capital of a savings association imposed by means of a resolution issued or condition imposed by the Federal Savings and Loan Insurance Corporation (“FSLIC”), the Federal Home Loan Bank Board (“Board”), the Office, or any of their delegates, a stipulation to the FSLIC, the Board, the Office, or any of their delegates, or an agreement between the acquiror and the FSLIC, the Board, the Office, or any of their delegates.

(5) Deficiency means the amount by which the level at which the acquiror is required to maintain the association's capital pursuant to a capital maintenance obligation exceeds the savings association's capital.

(6) Divestiture or divest means any action or conduct that would result in the acquiror no longer being in control of the savings association.

(7) Savings association means a Federal savings and loan association or a Federal savings bank chartered under section 5 of the Home Owners’ Loan Act, a building and loan, savings and loan or homestead association or a cooperative bank (other than a cooperative bank described in 12 U.S.C. 1813(a)(2)) the deposits of which are insured by the Federal Deposit Insurance Corporation, and any corporation (other than a bank) the deposits of which are insured by the Federal Deposit Insurance Corporation that the Office and the Federal Deposit Insurance Corporation jointly determine to be operating in substantially the same manner as a savings association, and shall include any savings bank or cooperative bank which is deemed by the Office to be a savings association under 12 U.S.C. 1467a(1).

(8) Savings and loan holding company means a savings and loan holding company as defined in § 574.2(q) of this chapter.

(b) Notice. Prior to divestiture of a savings association, an acquiror that is subject to a capital maintenance obligation shall provide written notice of such divestiture to the Office on Form DV, including the certifications required therein. If the acquiror is unable to provide such certifications, the acquiror may submit alternative certifications addressing the subjects of each certification, in a form acceptable to the Office.

(c) Determination of deficiency. Upon receipt of the notice required under paragraph (b) of this section, the Office will conduct a full or limited scope examination of the savings association, as deemed appropriate, to ascertain whether a deficiency exists as of the date of the examination. If such examination is not completed within 90 days of the notice required under paragraph (b) of this section, or the Office has not communicated the results of the examination to the acquiror within such period, the deficiency, if any, shall be calculated based on the savings association's most recent Thrift Financial Report, filed prior to the notice of divestiture, provided, however, that if the failure to complete an examination within 90 days is caused by any failure of the association or the acquiror to cooperate, the 90 day period may be extended by the Director of the Office for additional periods, including such time as may be needed to base a deficiency on the results of a completed examination. Notwithstanding any other provision of this section, if the Office determines that fraud or misrepresentation occurred during the course of an examination conducted to determine the association's capital, compliance with the procedures set forth in this section shall not be deemed to have extinguished an acquiror's capital maintenance obligation and the Office will seek appropriate enforcement remedies.

(d) Divestiture. (1) In the event that the examination conducted under paragraph (c) of this section indicates that no deficiency exists, the acquiror may divest control of the savings association to which the capital maintenance obligation relates upon receiving written notice of the results of the examination. Where the examination was not completed or the results not communicated to the acquiror in a timely manner, and the savings association's most recent Thrift Financial Report filed before the filing of the notice of divestiture indicates no deficiency existed at that time, the acquiror may divest control of the savings association to which the capital maintenance obligation relates 91 days after the receipt of the notice by the Office, or such longer period as established under paragraph (c) of this section.

(2) In the event that a deficiency exists, the acquiror may not divest control of the savings association to which the capital maintenance obligation relates unless:

(i) The acquiror provides the office with an agreement to infuse into the savings association the amount necessary to remedy the deficiency and make arrangements, satisfactory to the Office, to assure payment of the deficiency; or

(ii) The deficiency is satisfied.

(3) An acquiror may divest control of a savings association to which a capital maintenance obligation relates prior to the completion of the examination conducted under paragraph (c) of this section if the acquiror provides the Office with an agreement to infuse into the savings association the amount necessary to remedy the deficiency and makes arrangements, satisfactory to the Office, to assure payment of any deficiency.

(e) Effect of regulation on terms of capital maintenance obligations. This regulation does not supercede any liability imposed by a capital maintenance obligation.

(f) Exceptions. The Director of the Office may, upon application or upon his or her own initiative, grant or deny exemptions from this section.