Okla. Stat. tit. 18 § 381.74

Current through Laws 2024, c. 453.

Section 381.74 - Taking possession by Commissioner

A. Except as otherwise provided in this act, the State Banking Commissioner may take possession of a state-chartered savings and loan association, if the Commissioner determines that:

1. The business of the association is being conducted in an unlawful or unsound manner;

2. The association does not have funds available to pay all withdrawals of savings deposits when due or is otherwise unable to continue normal operations;

3. The examination of the association has been obstructed or impeded; or

4. The association is operating in violation of provisions of this act despite written notice to discontinue such violation.

1. The Commissioner may take possession of any state-chartered savings association by posting upon the premises of such association a notice reciting that possession is being assumed pursuant to the provisions of this section and stating when possession shall be deemed effective. Possession may become effective no earlier than the posting of the notice. A copy of the notice shall be filed in the district court of the county where the association is located. The Commissioner shall notify, if applicable, the appropriate district offices of the Director of the Office of Thrift Supervision and the Federal Deposit Insurance Corporation of taking possession of the association.

a. Once possession is effective the Commissioner shall be vested with the full and exclusive power of management and control, including the power to:

(1) continue or discontinue the business of the association,

(2) stop or limit the payment of the obligations of the association,

(3) employ any necessary assistants, including legal counsel,

(4) execute any instrument in the name of the association as Commissioner in charge of liquidation,

(5) commence, defend or conduct in the name of the association any action or proceeding to which it may be a party,

(6) enforce the liabilities of stockholders, officers and directors of the association,

(7) terminate possession by restoring the assets of the association to its board of directors, and

(8) reorganize or liquidate the association in accordance with this act.

b. As soon as practicable after taking possession the Commissioner shall make an inventory of the assets of the association and file a copy thereof with the district court where the notice of possession was filed.

3. While the Commissioner is in possession there shall be a postponement of six (6) months after the effective date of possession, of the date upon which any period of limitation fixed by statute or agreement would otherwise expire on a claim or right of action of the association, or upon which a review must be taken or a pleading or other document must be filed by the association in any pending action or proceeding.

a. The Commissioner, within two (2) days after taking possession of a stock association, shall call a special meeting of the stockholders to allow the stockholders to retain the incumbent board of directors or to elect a newly constituted board of directors, who may represent the stockholders in the liquidation proceedings and observe, assist and protect the interests of the stockholders.

b. The board of directors of the association is authorized to bring all necessary legal actions for and on behalf of the stockholders and to pay attorney's fees in a reasonable amount, if such action benefits the liquidating account of the failed association.

c. The board of directors, as authorized by the stockholders, shall represent the stockholders in the district court in which the notice of possession was filed by the Commissioner, as to all matters affecting the association.

5. The association shall continue to exist as a body corporate for all purposes, except for the purpose of continuing the business for which the association was organized, and may function to assist the Commissioner or to protect the stockholders' interests in the assets of the liquidating account.

1. If the Commissioner determines that an emergency exists which may result in serious losses to the depositors of an association, he may take possession of the association without a prior hearing. Within ten (10) days after the Commissioner has taken possession any interested person may appeal such action pursuant to the provisions of Section 207 of Title 6 of the Oklahoma Statutes.

2. If the Commissioner determines that liquidation of the association is warranted, notice of such determination shall be given to such directors, stockholders, depositors and creditors of the association as the Commissioner may prescribe. The notice shall be by restricted delivery to the directors and stockholders at their last-known address as shown on the records of the association, and notice to the depositors and creditors shall be published in a newspaper of general circulation in the county where the main office of such association is located. Any objection to such determination by a person directly affected thereby shall be appealed pursuant to the provisions of Section 207 of Title 6 of the Oklahoma Statutes. Unless within ten (10) days after the date of publication an order is issued staying the liquidation or unless the Commissioner tenders to the Federal Deposit Insurance Corporation the appointment as liquidator pursuant to Section 381.77 of this title, the Commissioner shall liquidate the association after providing a bond executed by a surety company authorized to do business in this state, for the benefit of the people of this state, for the faithful discharge of the duties of the Commissioner in connection with such liquidation and the accounting for all monies coming into the possession of the Commissioner. The cost of such bond shall be paid from the assets of the association. Suit may be maintained on such bond by any person injured by a breach of the conditions thereof.

3. After the Commissioner takes possession of an association pursuant to the provisions of this section, the stockholders thereof may repair its credit, restore or substitute its reserves, and otherwise improve its condition so that it is qualified to do a general savings and loan business as provided for by law. Such association shall not reopen its business until the Commissioner issues written permission therefor after an investigation of the affairs of the association and a determination that the board of directors of the association has complied with all applicable laws, that the association's credit and funds are in all respects repaired, and its reserves restored or sufficiently substituted, and that it again should be permitted to reopen for business. Written permission to reopen to do a general savings and loan business shall be issued in the same manner as is provided by law for granting permission to do business after incorporation.

4. If the Commissioner determines that reorganization of the association is warranted or if the Supreme Court, after staying the liquidation of the association, orders such reorganization, the Commissioner, after according a hearing to all interested persons, shall enter an order proposing a reorganization plan. A copy of the plan shall be sent to each depositor and creditor who will not receive full payment of their claim under the plan, together with notice that, unless the plan is disapproved, within fifteen (15) days after the date of the mailing of the plan, in writing by persons holding one-third (1/3) or more of the aggregate amount of such claims, the Commissioner shall proceed to effect the reorganization. A department, agency, or political subdivision of this state holding a claim which will not be paid in full is authorized to participate in the reorganization as any other creditor.

a. Notwithstanding any other provision to the contrary, the Commissioner, upon taking possession of an association, may immediately liquidate said association without giving prior notice to the directors, stockholders, depositors and creditors of such association, if it is determined by order of the district court where notice of possession was filed that the immediate liquidation of the association is necessary to protect the interests of the depositors of the association and is otherwise in the public interest.

b. In proceeding with the immediate liquidation of the association, the Commissioner, in order to facilitate the assumption of the deposit liabilities of the closed insured association by another association, may borrow monies from the Federal Deposit Insurance Corporation and pledge some or all of the assets of the closed insured association as security for such borrowing or may sell some or all of the assets of the closed insured association to the Federal Deposit Insurance Corporation.

6. Once the Commissioner takes possession of an association for purposes of liquidation, neither the ten-day periods provided by subsection C of this section nor the pendency of any proceeding for review of the action of the Commissioner shall operate to defer, delay, impede or prevent the payment by the Federal Deposit Insurance Corporation of the insured deposits of an insured association.

7. The Commissioner shall make available to the Federal Deposit Insurance Corporation such facilities in or of an insured association and such books, records and other relevant data of the insured association as may be necessary or appropriate to enable the Federal Deposit Insurance Corporation to pay the insured deposits in the insured association as provided in this subsection. The Federal Deposit Insurance Corporation, its directors, officers, agents, and employees, and the Commissioner, and the agents and employees of the Commissioner, shall be free from any liability to the insured association, its directors, stockholders, and creditors, for any action relating to the payment of insured deposits.

D. No judgment, lien, or attachment shall be executed upon any asset of the association while it is in the possession of the Commissioner. The Commissioner, in connection with a liquidation or reorganization may:

1. Vacate and void any lien or attachment, other than an attorney's or mechanic's lien, obtained upon any asset of the association during the Commissioner's possession or within four (4) months prior to commencement thereof, except liens created by the Commissioner while in possession; and

2. Void any transfer of an asset of the association made after or in contemplation of its insolvency with intent to effect a preference.

E. The Commissioner may borrow money in the name of the association and may pledge its assets as security for a loan.

F. All necessary and reasonable expenses of the Commissioner relating to the possession of an association and of its reorganization or liquidation shall be defrayed from the assets of the association. Compensation to liquidating agents and employees shall not be in excess of amounts which such individuals would be entitled to in their regular employment or for like services rendered within the area of the insolvent association, and in no event shall a liquidating agent be paid a monthly salary or wage from the assets of the association in excess of the amount of the monthly salary of the highest paid official of the insolvent association. Any attorney's fee allowed to an attorney representing the liquidating agent shall not exceed the reasonable amount charged by other attorneys of similar competence for like services in regular employment of an attorney in the area of the association.

Okla. Stat. tit. 18, § 381.74

Added by Laws 1987, HB 1267, c. 61, § 21, emerg. eff. 5/4/1987; Amended by Laws 1990, HB 2278, c. 118, § 24, emerg. eff. 4/23/1990; Amended by Laws 1993, SB 31, c. 183, § 68, emerg. eff. 7/1/1993; Amended by Laws 2000 , HB 2675, c. 81, § 75, eff. 11/1/2000.