Section 0180-19-.10 - APPLICATION FOR INVESTMENTS IN CERTAIN BUSINESS ENTITIES(1) Upon filing an application and receiving written approval from the Commissioner, pursuant to T.C.A. § 45-2-607(d) a bank may make a minority investment in the stock or purchase the assets of other corporations, firms, partnerships or companies, including limited liability companies and limited liability partnerships that engage in certain approved activities as provided in T.C.A. § 45-2-607(d).(2) The application required by paragraph (1) shall be subject to the same procedure and requirements as those contained in Rule 0180-19-.06.(3) Whenever the Commissioner deems it necessary, the commissioner may examine any business in which the bank has a minority interest approved under this Rule and T.C.A. § 45-2-607(d).(4) In approving the application the Department will consider the following guidelines: (a) The bank must be able to prevent the entity or enterprise in which the investment is made from engaging in impermissible activities, or be able to withdraw its investment;(b) The bank's loss exposure must be limited, as a legal and accounting matter, and the bank must not have open-ended liability for the obligations of the enterprise; and(c) The activities of the entity or enterprise in which the investment is made must be limited to approved activities.Tenn. Comp. R. & Regs. 0180-19-.10
Original rule filed August 31, 1998; effective December 29, 1998.Authority: T.C.A. § 45-1-107(f) and (h);45-1-118(f); 45-2-602; 45-2-607(d) and 45-2-1602(b)(e).