Michigan Laws 487.14310 – Investment in service entity
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(1) As authorized by order or declaratory ruling of the commissioner, a bank may invest in service entities that engage in activities in which a bank is not authorized to engage.
(2) The maximum aggregate investment by a bank in service entities shall be the lesser of 5% of the bank’s total assets or 75% of its capital and surplus.
Terms Used In Michigan Laws 487.14310
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Bank: means a state banking corporation that is organized or reorganized under this act or organized under any law of this state enacted before March 1, 2000, including a state banking corporation that voluntarily limits its activities. See Michigan Laws 487.11201
- Service entity: means a corporation, mutual company, limited liability company, limited liability partnership, or limited partnership in which a bank has invested under section 4310(1). See Michigan Laws 487.11203
- Subsidiary: means a corporation, mutual company, limited liability company, limited liability partnership, or limited partnership, the controlling interests of which are more than 50% owned by 1 or more depository institutions, and in which a bank has an ownership interest, membership interest, or other legally enforceable interest that is the indicia of ownership. See Michigan Laws 487.11203
- Surplus: means the amount paid for issued and outstanding common and preferred stock of a bank in excess of the stated par value, plus any amount of transferred undivided profits and any additional amounts paid in or contributed to increase total capital. See Michigan Laws 487.11203
(3) The commissioner shall give notice to all banks of orders and declaratory rulings issued under this section.
(4) For purposes of subsection (2), investment in a service entity shall include loans by a bank or its subsidiary to a service entity.
(5) Subject to the investment limit in subsection (2), a bank or its subsidiary that has made an initial investment in a service entity may make additional investments in that service entity without notice to the commissioner.