§ 192.105 - Information required in business plan.

§ 192.105 What information must I include in my Information required in business plan?.

(a) Minimum requirements. Prior to filing an application for conversion, you a savings association must adopt a business plan reflecting your its intended plans for deployment of the proposed conversion proceeds. Your The savings association's business plan is required, under § 192.150, to be included in your its application for conversion application. At a minimum, your the business plan must address:

(1) Your The savings association's projected operations and activities for three years following the conversion. You These projections must describe include how you the savings association will deploy the accomplish the following by the final year of the business plan:

(i) Deploy the conversion proceeds at the converted savings association (and holding company, if applicable)

, what

;

(ii) What opportunities are available to reasonably achieve

your

its planned deployment of conversion proceeds in

your

the proposed market areas

, and how your

; and

(iii) How the deployment will provide a reasonable return on investment commensurate with investment risk, investor expectations, and industry norms

, by the final year of the business plan. You

. The savings association must include three years of projected financial statements. The business plan must provide that the converted savings association must retain at least 50 percent of the net conversion proceeds. The appropriate Federal banking agency may require that a larger percentage of proceeds remain in the institution.

(2) Your The savings association's plan for deploying conversion proceeds to meet credit and lending needs in your the proposed market areas. The appropriate Federal banking agencies strongly discourage business plans that provide for a substantial investment in mortgage securities or other securities, except as an interim measure to facilitate orderly, prudent deployment of proceeds during the three years following the conversion , or as part of a properly managed leverage strategy.

(3) The risks associated with your the savings association's plan for deployment of conversion proceeds, and the effect of this plan on management resources, staffing, and facilities.

(4) The expertise of your the savings association's management and board of directors, or that you have planned plans for adequate staffing and controls to prudently manage the growth, expansion, new investment, and other operations and activities proposed in your the business plan.

(b) You Prohibited information. The savings association may not project returns of capital or special dividends in any part of the business plan. A newly converted company may not plan on stock repurchases in the first year of the business plan.