(a)

Terms Used In Tennessee Code 45-2-602

  • Bank: means any person, as hereinafter defined, doing a banking business subject to the laws of this or any other jurisdiction and, for the purposes of supervision, examination and liquidation, includes industrial investment companies and industrial banks authorized by chapter 5 of this title. See Tennessee Code 45-1-103
  • Commissioner: means the commissioner of financial institutions. See Tennessee Code 45-1-103
  • Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
  • Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
  • State bank: means any bank chartered by this state. See Tennessee Code 45-1-103
  • Subsidiary corporation: means any corporation, all or part of the stock of which is owned by a bank principally for the purpose of participating in the active management of the business of the corporation as distinguished from the purpose of deriving profit from the appreciation in value of the stock or from dividends paid on the stock. See Tennessee Code 45-1-103
(1) Any bank may exercise any of its powers through the medium of a subsidiary corporation or corporations. Any and all rights conferred upon banks shall be fully applicable to the subsidiary corporations of banks. Banks shall not be permitted, however, through the use of subsidiary corporations to circumvent the restrictions imposed by § 45-2-614. Whenever the commissioner deems it necessary, the commissioner may examine any corporation that is a subsidiary corporation of a state bank.
(2) A bank may organize, participate in or own an ownership interest in a limited liability company, or limited liability partnership, under this section and this title.
(b)

(1) For the purposes of this section, a minority stock ownership interest in a credit insurance company whose capital meets or exceeds the requirements of § 56-2-114, or in an insurance holding company system as defined in § 56-11-101, whose principal business is conducted through one (1) or more credit insurance companies whose capital meets or exceeds the requirements of § 56-2-114, shall be deemed to be a subsidiary; provided, that the original cost of the stock ownership interest does not exceed five percent (5%) of the capital and surplus of the bank; and provided further, that no one (1) bank shall own more than five percent (5%) of the stock in the credit insurance company or insurance holding company system.
(2) The existence and operation of any subsidiary corporation formed prior to June 9, 1981, shall not be impaired by subdivision (b)(1).
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