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Can you summarize UTCO 7-1-703?
Authorization Required to Conduct Business > Restrictions on acquisition of institutions and holding companies -- Enforcement. (Superseded 7/1/2024)
Short Summary
This legal document, under the Financial Institutions Act, imposes restrictions on the acquisition of institutions and holding companies subject to the jurisdiction of the department. Unless prior written approval is obtained from the commissioner, a person may not acquire control of a depository institution or depository institution holding company, vote the stock acquired in violation, acquire assets or deposit liabilities, cause a depository institution to become a subsidiary of a holding company, cause a person other than an individual to become a holding company, acquire voting or nonvoting securities exceeding 20% of authorized voting securities, or merge or consolidate with a depository institution or holding company. Violators may be subject to civil penalties of up to $1,000 per day. The commissioner may also secure injunctive relief and may exempt certain financial institutions from these restrictions. There are exemptions for acquisitions made through foreclosure or in the ordinary course of collecting a debt, if divested within two years. Out-of-state depository institutions may acquire Utah institutions or branches under certain conditions. This document was amended in the 2017 and 2023 General Sessions.
Whom does it apply to?
Persons seeking to acquire control of a depository institution or depository institution holding company subject to the jurisdiction of the department
What does it govern?
Restrictions on acquisition of institutions and holding companies
What are exemptions?
Acquisition of voting securities or assets of a depository institution or a depository institution holding company acquired by foreclosure or in the ordinary course of collecting a debt previously contracted in good faith, if divested within two years of acquisition
What are the Penalties?
A person who willfully violates this section or a rule or order issued by the department is subject to a civil penalty of not more than $1,000 per day during which the violation continues
Jurisdiction
Utah