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Can you summarize NERS 8-702?
BANKS AND BANKING > Banking institutions; maintain membership in Federal Deposit Insurance Corporation; exception; automatic forfeiture of charter; prohibited acts; penalty.
Short Summary
This section of the Nebraska Revised Statutes governs the requirements for banking institutions organized under the laws of Nebraska to obtain membership in the Federal Deposit Insurance Corporation (FDIC) and provide insurance for deposits. It specifies that before a charter is issued, a banking institution must enter into contracts and incur obligations necessary for FDIC membership. Banking institutions are allowed to take advantage of various benefits and privileges available to FDIC members. Failure to maintain FDIC membership results in automatic forfeiture of the banking institution’s charter, leading to liquidation and dissolution. Engaging in business after forfeiture is a Class III felony. However, digital asset depository institutions organized under the Nebraska Financial Innovation Act are exempt from the prohibition and can obtain FDIC insurance.
Whom does it apply to?
Banking institutions organized under the laws of Nebraska, except digital asset depository institutions
What does it govern?
Membership in the Federal Deposit Insurance Corporation and insurance of deposits in banking institutions
What are exemptions?
Digital asset depository institutions organized, chartered, and operated pursuant to the Nebraska Financial Innovation Act are not prohibited from obtaining Federal Deposit Insurance Corporation insurance
What are the Penalties?
Automatic forfeiture of charter for banking institutions that fail to maintain membership in the Federal Deposit Insurance Corporation. Continuing to engage in business after forfeiture is a Class III felony for the banking institution, directors, and officers.
Jurisdiction
Nebraska