HS HB 736 -- OMNIBUS BANKING BILL (Liese)

This substitute amends various provisions relating to banking
law.  In its main provisions, the substitute:

(1)  Allows the city of Warrensburg to receive bids for city
banking business at any regular meeting and allows the city's
bank depositary contracts to last as long as 3 years.  Current
law requires cities to receive bids at their July meetings and
allows only one year contracts;

(2)  Allows banking S corporations to take a tax credit for all
of their allowed tax returns, as opposed to allowing only a
credit on the tax on bank income;

(3)  Redefines "tax credit" for purposes of banking S
corporations to include all income taxes and corporate franchise
taxes;

(4)  Allows resident shareholders of nonresident S corporations
to take the tax credits that are allowed to resident S
corporations, but only for the amount of tax paid in the foreign
state and not to exceed 6% of the corporation's net income;

(5)  States that, if the corporate franchise tax is repealed for
Missouri corporations other than financial institutions, then
(a) financial institutions will be granted a tax credit, in lieu
of the existing tax credit, of 1.5% of net income.  S
corporations can pass the tax credit through to their
shareholders; and (b) all taxes and tax credits on S
corporations will be passed through to the shareholders, with
certain exceptions;

(6)  Allows insurance companies, beginning with the tax year
2003, to carry premium tax deductions for examination fees
forward to any of the 5 subsequent tax years in order to claim
the full deduction;

(7)  Clarifies the manner in which subordinate liens on motor
vehicles or trailers must be perfected;

(8)  Modifies bank stockholders' meetings laws to allow voting
shareholders to transact all business required at annual or
special meetings by unanimous written consent;

(9)  Allows state bank and trust companies to (a)  hold
noncontrolling equity interests in financial business entities
that are owned by other financial institutions located in
Missouri, and (b)  lend money on real estate and handle real
estate closings and escrows;

(10)  Allows certain bank and trust companies in communities
with sufficiently small populations, as established by rule of
the Division of Finance, to keep the additional powers granted
to them for 5 years after they exceed the allowable population;

(11)  Allows state bank and trust companies to offer any product
or service that a national bank can offer, as long as the state
bank:  (a) follows federal law while conducting these practices,
and (b)  is approved for these purposes by the Division of
Finance after a prescribed notice period;

(12)  Expands the capital investment allowances granted to state
banks to include holding companies authorized to do business in
the state;

(13)  Clarifies that certain investment prohibitions in the
substitute are limited only to other allowable investments;

(14)  Allows bank and trust stockholders to appoint a chief
executive officer or a president.  Current law only allows
presidents to be appointed;

(15)  Allows bona fide fees to be collected on residential real
estate loans for any actual and necessary services associated
with the loan;

(16)  Allows late payment charges not to exceed 5% of the
payment due or $50, whichever is less, on small loans overdue
for 15 days or more;

(17)  Prohibits any regulation regarding the charging of
insurance commissions on credit insurance or the payment of fair
market value consideration on contracts to facilitate the sale
of insurance from being more restrictive on financial
institutions than regulations are on insurance agents, subject
to enforcement actions by the Division of Finance or the
Division of Credit Unions as necessary to protect the safety and
soundness of the financial institution; and

(18)  Increases the attachment exemption for unmatured life
insurance contracts of persons in bankruptcy proceedings from
$5,000 to $250,000.

FISCAL NOTE:  Loss to General Revenue Fund of Unknown in FY
2002, FY 2003, and FY 2004.

Missouri House of Representatives
Last Updated November 26, 2001 at 11:45 am