Session of 2025
SENATE BILL No. 139
By Committee on Financial Institutions and Insurance
1-31
AN ACT concerning banks and trust companies; relating to the state
banking code; updating certain definitions, terms and conditions
therein; specifying that certain hearings be held in accordance with the
Kansas administrative procedure act; updating certain internal
references; requiring immediate notification of changes in board
members; specifying that the charter of certain banks be deemed void
on the effective date of a merger; establishing conditions under which it
would be lawful to engage in banking without first obtaining authority
from the commissioner; amending K.S.A. 9-519, 9-1111, 9-1114, 9-
1724, 9-1807, 9-2011, 9-2108 and 9-2111 and K.S.A. 2024 Supp. 9-
2107 and repealing the existing sections; also repealing K.S.A. 9-2101
and 16-842.
Be it enacted by the Legislature of the State of Kansas:
Section 1. K.S.A. 9-519 is hereby amended to read as follows: 9-519.
For the purposes of K.S.A. 9-520 through 9-524, and amendments thereto,
and K.S.A. 9-532 through 9-541, and amendments thereto, unless
otherwise required by the context:
(a) "Bank" means an insured bank as defined in 12 U.S.C. § 1813(h)
except the term shall. "Bank" does not include a national bank that:
(1) Engages only in credit card operations;
(2) does not accept demand deposits or deposits that the depositor
may withdraw by check or similar means for payment to third parties or
others;
(3) does not accept any savings or time deposits of less than
$100,000;
(4) maintains only one office that accepts deposits; and
(5) does not engage in the business of making commercial loans.
(b) (1) "Bank holding company" means any company that:
(A) Directly or indirectly owns, controls, or has power to vote 25% or
more of any class of the voting shares of a bank or 25% or more of any
class of the voting shares of a company that is or becomes a bank holding
company by virtue of this act;
(B) controls in any manner the election of a majority of the directors
of a bank or of a company that is or becomes a bank holding company by
virtue of this act;
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(C) the commissioner determines, after notice and opportunity for a
hearing to be conducted in accordance with the Kansas administrative
procedure act, directly or indirectly exercises a controlling influence over
the management or policies of the bank or company.
(2) Notwithstanding paragraph (1), no company:
(A) Shall be deemed to be a bank holding company by virtue of the
company's ownership or control of shares acquired by the company in
connection with such company's underwriting of securities if such shares
are held only for such period of time as will permit the sale thereof on a
reasonable basis;
(B) formed for the sole purpose of participating in a proxy solicitation
shall be deemed to be a bank holding company by virtue of the company's
control of voting rights of shares acquired in the course of such
solicitation;
(C) shall be deemed to be a bank holding company by virtue of the
company's ownership or control of shares acquired in securing or
collecting a debt previously contracted in good faith, provided such shares
are disposed of within a period of two years from the date on which such
shares could have been disposed of by such company; or
(D) owning or controlling voting shares of a bank shall be deemed to
be a bank holding company by virtue of the company's ownership or
control of shares held in a fiduciary capacity except where such shares are
held for the benefit of such company or the company's shareholders.
(c) "Company" means any corporation, limited liability company,
trust, partnership, association or similar organization, including a bank, but
shall does not include any corporation, the majority of the shares of which
are owned by the United States or by any state, or include any individual,
partnership or qualified family partnership upon the determination by the
commissioner that a general or limited partnership qualifies under the
definition in 12 U.S.C. § 1841(o)(10).
(d) "Foreign bank" means any company organized under the laws of a
foreign country, a territory of the United States, Puerto Rico, Guam,
American Samoa or the Virgin Islands or any subsidiary or affiliate
organized under such laws, which that engages in the business of banking.
(e) "Kansas bank" means any bank, as defined by subsection (a), that,
in the case of a state chartered bank, is a bank chartered under the
authority of the state of Kansas, and, in the case of a national banking
association, a bank with its charter location in Kansas.
(f) "Kansas bank holding company" means a bank holding company,
as defined by subsection (b), with total subsidiary bank deposits in Kansas
that exceed the bank holding company's subsidiary bank deposits in any
other state.
(g) "Out-of-state bank holding company" means any holding
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company that is not a Kansas bank holding company as defined in
subsection (f).
(h) "Subsidiary" means, with respect to a specified bank holding
company:
(1) Any company with more than 5% of the voting shares, excluding
shares owned by the United States or by any company wholly owned by
the United States, that are directly or indirectly owned or controlled by, or
held with power to vote, such bank holding company; or
(2) any company, the election of a majority of the directors of which,
is controlled in any manner by such bank holding company.
Sec. 2. K.S.A. 9-1111 is hereby amended to read as follows: 9-1111.
(a)(1) The general business of every bank shall be transacted at the place
of business specified in the bank's certificate of authority and at one or
more branch banks established and operated as provided in this section. It
shall be unlawful for any bank to establish and operate any branch bank or
relocate an existing branch bank except as hereinafter provided.
Notwithstanding the provisions of this section, any location at which
where a depository institution, as defined by K.S.A. 9-701, and
amendments thereto, receives deposits, renews time deposits, closes loans,
services loans or receives payments on loans or other obligations, as agent,
for a bank pursuant to K.S.A. 9-1101(a)(25), and amendments thereto, or
other applicable state or federal law, or is authorized to open accounts or
receive deposits under K.S.A. 9-1101(a)(28), and amendments thereto,
shall not be deemed to be a branch bank:.
(a)(2) For the purposes of this section, the term "branch bank" means
any office, agency or other place of business located within this state, other
than the place of business specified in the bank's certificate of authority, at
which where deposits are received, checks paid, money lent or trust
authority exercised, if approval has been granted by the commissioner
pursuant to K.S.A. 9-1602 9-1601, and amendments thereto;.
(b) establishment ofTo establish a new branch bank or relocation of
relocate an existing branch bank:
(1) After first applying for and obtaining the approval of the
commissioner, A bank incorporated under the laws of this state may
establish and operate one or more branch banks or relocate an existing
branch bank, anywhere within this state after first applying for and
obtaining the commissioner's approval;
(2) the application shall include the nature of the banking business to
be conducted at the proposed branch bank, the primary geographical area
to be served by the proposed branch bank, the personnel and office
facilities to be provided at the proposed branch bank and other information
the commissioner may require;
(3) the application shall include the name selected for the proposed
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branch bank. The name selected for the proposed branch bank shall not be
the name of any other bank or branch bank:
(A) Doing business in the same city or town; or
(B) within a 15-mile radius of the proposed location, nor shall the
name selected be required to contain the name of the applicant bank. If the
name selected for the proposed branch bank does not contain the name of
the applicant bank, the branch bank shall provide in the public lobby of
such branch bank, a public notice that it is a branch bank of the applicant
bank. Any bank may request exemption from the commissioner from the
provisions of this paragraph;
(4) the application shall include proof of publication of notice that the
applicant bank intends to file or has filed an application to establish a
branch bank or relocate an existing branch bank. The notice shall be
published in a newspaper of general circulation in the county where the
applicant bank proposes to locate the branch bank. The notice shall be in
the form prescribed by the commissioner and, at a minimum, shall contain
the name and address of the applicant bank, the location of the proposed
branch and a solicitation for written comments. The notice shall be
published on the same day for two consecutive weeks and provide for a
comment period of not less than 10 days after the date of the second
publication;
(5) upon receipt of the application, and following expiration of the
comment period, the commissioner may hold a hearing in the county in
which where the applicant bank seeks to operate the branch bank. The
applicant shall publish notice of the time, date and place of such hearing in
a newspaper of general circulation in the county where the applicant bank
proposes to locate the branch bank, within not less than 10, nor more than
30, days prior to the date of the hearing, and proof of publication shall be
filed with the commissioner. At any such hearing, all interested persons
shall be allowed to present written and oral evidence to the commissioner,
or the commissioner's designee, in support of or in opposition to the
branch bank. Upon completion of a transcript of the testimony given at any
such hearing, the transcript shall be filed in the office of the commissioner;
(6) if the commissioner determines a public hearing is not warranted,
the commissioner shall approve or disapprove the application within 15
days after receipt of a complete application, but not prior to the end of the
comment period. If a public hearing is held, the commissioner shall
approve or disapprove the application within 60 days after consideration of
the complete application and the evidence gathered during the
commissioner's investigation. The period for consideration of the
application may be extended if the commissioner determines that the
application presents a significant supervisory concern. The new branch or
relocation shall only be granted if the commissioner finds that:
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(A) There is a reasonable probability of usefulness and success of the
proposed branch bank; and
(B) the applicant bank's financial history and condition is sound;
(7) within 15 days after any final action of the commissioner
approving or disapproving an application, the applicant, or any adversely
affected or aggrieved person that provided written comments during the
specified comment period, may request a hearing with the state banking
board. Upon receipt of a timely request, the state banking board shall
conduct a hearing in accordance with the provisions of the Kansas
administrative procedure act. Any decision of the state banking board is
subject to review in accordance with the Kansas judicial review act;.
(c) Upon the request of any bank proposing to relocate an existing
branch less than one mile from the existing location, the commissioner
may exempt such bank from the requirements of this section;.
(d) Any branch bank lawfully established and operating on the
effective date of this act may continue to be operated by the bank then
operating the branch bank and by any successor bank;.
(e) Any bank location which that has been established and is being
maintained by a bank at the time of the bank's merger into or consolidation
with another bank or at the time the bank's assets are purchased and the
bank's liabilities are assumed by another bank may continue to be operated
by the surviving, resulting or purchasing and assuming bank;.
(f) Any state bank or national banking association may provide and
engage in banking transactions by means of remote service units wherever
located, which. Remote service units shall not be considered to be branch
banks. Any banking transaction effected affected by use of a remote
service unit shall be deemed to be transacted at a bank and not at a remote
service unit;.
(g) As a condition to the operation and use of any remote service unit
in this state, a state bank or national banking association, each hereinafter
referred to as a bank, which that desires to operate or enable its customers
to utilize a remote service unit must shall agree that such remote service
unit will be available for use by customers of any other bank or banks
upon the request of such bank or banks to share the use of the remote
service unit and the agreement of such bank or banks to share all costs,
including a reasonable return on capital expenditures incurred in
connection with the remote service unit's development, installation and
operation. The owner of the remote service unit, whether a bank or any
other person, shall make the remote service unit available for use by other
banks and their customers on a nondiscriminatory basis, conditioned upon
payment of a reasonable proportion of all costs, including a reasonable
return on capital expenditures incurred in connection with the
development, installation and operation of the remote service unit.
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Notwithstanding the foregoing provisions of this subsection, a remote
service unit located on the property owned or leased by the bank where the
principal place of business of a bank, or branch bank of a bank, is located
need not be made available for use by any other bank or banks or
customers of any other bank or banks;.
(h) For purposes of this section, "remote service unit" means an
electronic information processing device, including associated equipment,
structures and systems, through or by means of which information relating
to financial services rendered to the public is stored and transmitted to a
bank and which that, for activation and account access, is dependent upon
the use of a machine-readable instrument in the possession and control of
the holder of an account with a bank or is activated by a person upon
verifiable personal identification. The term shall include "Remote service
unit" includes "online" computer terminals which that may be equipped
with a telephone or televideo device that allows contact with bank
personnel and "offline" automated cash dispensing machines and
automated teller machines. Withdrawals by means of "offline" systems
shall not exceed $300 per transaction and shall be restricted to individual,
not corporate or commercial, accounts;.
(i) Upon providing notice to the commissioner, any state bank may
conduct loan production activity at locations other than the place of
business specified in the bank's certificate of authority or approved branch
banks.
(1) Loan production activity shall consist of the following:
(A) Soliciting, assembling or processing of credit information and
loan applications;
(B) approval of loan applications; or
(C) loan closing activities, such as the execution of promissory notes
and deeds of trust.
(2) No customer shall be allowed to take actual receipt of the loan
funds;.
(j) Upon providing notice to the commissioner, any state bank may
conduct deposit production activity at locations other than the place of
business specified in the bank's certificate of authority or approved branch
banks provided there is no acceptance of actual deposits in person or by
drop box;.
(k) Upon providing notice to the commissioner, any state bank may
provide any of the following at a location other than the place of business
specified in the bank's certificate of authority without becoming a branch
bank:
(1) Operate safe deposit boxes;
(2) sell travelers checks and saving bonds; and
(3) operate check cashing check-cashing services so long as if no
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actual account withdrawal occurs;
(l) any bank or trust company closing a branch bank, loan production
office, deposit production office or other location shall provide notice to
the commissioner.
Sec. 3. K.S.A. 9-1114 is hereby amended to read as follows: 9-1114.
(a) The business of any bank or trust company shall be managed and
controlled by such bank's or trust company's board of directors.
(b) The board shall consist of not less fewer than five nor more than
25 members who shall be elected by the stockholders at any regular annual
meeting which that shall be held on the date specified in the bank's or trust
company's bylaws. A majority of the directors shall be residents of this
state. Minutes shall be made of each stockholders' meeting of a bank or
trust company. The minutes shall show any action taken by the
stockholders, including the election of all directors.
(c) If, for any reason, the meeting cannot be held on the date specified
in the bylaws, the meeting shall be held on a subsequent day within 60
days of the day fixed, to be designated by the board of directors, or, if the
directors fail to fix the day, by the shareholders representing
2
/3 of the
shares.
(d) In all cases, at least 10 days' notice of the date for the annual
meeting shall have been be given by first-class mail to the shareholders.
(e) Any newly created directorship must shall be approved and
elected by the shareholders in the manner provided in the general
corporation code. A special meeting of the shareholders may be convened
at any time for such purpose.
(f) Any vacancy in the board of directors may be filled by the board
of directors in the manner provided in the general corporation code.
(g) Any director of any bank or trust company who shall become
becomes indebted to such bank or trust company on any judgment or
whose indebtedness is charged off or forgiven shall forfeit such person's
position as director.
(h) Within 15 days after the annual meeting, the president or cashier
of every bank and every trust company shall submit to the commissioner a
certified list of stockholders and the number of shares owned by each. This
list of stockholders shall be kept and maintained in the bank's or trust
company's main office and shall be subject to inspection by all
stockholders during the business hours of the bank or trust company. The
commissioner may require the list to be filed using an electronic means.
(i) Each director shall take and subscribe an oath to administer the
affairs of such bank or trust company diligently and honestly and to not
knowingly or willfully permit any of the laws relating to banks or trust
companies to be violated. A copy of each oath shall be retained by the
bank or trust company in the bank's or trust company's records after the
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43 SB 139 8
election of any officer or director, for review by the commissioner's staff
during the next examination. Each bank and trust company shall file an
oath with the commissioner within 15 days of the election of any officer or
director. The commissioner may require the oath to be filed using an
electronic means.
(j) EveryEach bank and trust company shall notify the commissioner
of any change in the newly appointed chief executive officer, president or
directors prior to the commencement of any such individual's duties,
including in such bank's or trust company's report a statement of the past
and current business and professional affiliations of the new chief
executive officer, president or directors. Each bank and trust company
shall notify the commissioner of any chief executive officer, president or
director that is voluntarily or involuntarily relieved from the position
duties within five business days.
Sec. 4. K.S.A. 9-1724 is hereby amended to read as follows: 9-1724.
(a) The provisions of K.S.A. 9-1720 through 9-1724, and amendments
thereto, shall not apply to the merger transaction of a bank or trust
company when the surviving entity is a national banking association or
other state or federally chartered financial institution or a trust company,
except that the bank or trust company shall provide written notification to
the commissioner of such a merger, consolidation or transfer of assets and
liabilities at least 10 days prior to the consummation of any such
transaction.
(b) Any bank or trust company that will cease to exist following the
consummation of any approved merger transaction shall have its charter
deemed void on the next business day immediately following the merger
consummation date. Not more than 15 days following any merger
transaction, any bank or trust company that will cease to exist shall
surrender such bank's or trust company's state certificate of authority or
charter and shall certify in writing that the proper instruments have been
executed and filed in accordance with K.S.A. 17-6003, and amendments
thereto.
(c) Notice of the merger transaction shall be published twice in a
newspaper of general circulation in each city or county in which where the
bank or trust company is located, or the newspaper nearest such city or
county, and a certified copy of each notice shall be filed with the
commissioner. The first publication shall be no not later than five days
after an application is filed. The second publication shall be on the 14
th
day
after the date of the first publication or, if the newspaper does not publish
on the 14
th
day, then the date that is the closest to the 14
th
day. The notice
shall be in the form prescribed by the commissioner and shall provide for a
comment period of not less than 10 days after the date of the second
publication.
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43 SB 139 9
Sec. 5. K.S.A. 9-1807 is hereby amended to read as follows: 9-1807.
(a) If the commissioner finds that any bank or trust company is engaging,
has engaged or is about to engage in an unsafe or unsound practice or if
the commissioner finds that any bank or trust company is violating, has
violated or is about to violate a law, rule and regulation or order of the
commissioner or state banking board, the commissioner may issue and
serve upon the bank or trust company a notice of charges. The notice of
charges shall contain a statement of the facts that forms the basis for a
proposed cease and desist order and shall state the time and place at which
that a hearing will be held by the state banking board to determine whether
an order to cease and desist therefrom should be issued by the state
banking board against the bank or trust company. Such hearing shall be
fixed for a date not earlier than 30 days nor later than 60 days after service
of such notice and shall be held in accordance with the Kansas
administrative procedure act.
(b) Unless the bank or trust company shall appear appears at the
hearing, such bank or trust company shall be deemed to have consented to
the issuance of the cease and desist order. In the event of such consent, or
if, upon the record made at any such hearing, the state banking board shall
find finds that any unsafe or unsound practice or violation specified in the
notice of charges has been established, the state banking board may issue
and serve upon the bank or trust company an order to cease and desist
from any such practice or violation. Such order may require the bank or
trust company and such bank's or trust company's directors, officers,
employees or agents to cease and desist or to take affirmative action to
correct the conditions resulting from any such practice or violation. A
cease and desist order shall become effective at the time specified therein
and shall remain effective and enforceable as provided therein, except to
such extent as it is stayed, modified or terminated by the state banking
board.
(c) Whenever the commissioner finds that a bank's or trust company's
unsafe or unsound practice or violation, or the continuation thereof, is
likely to cause insolvency, substantial dissipation of assets or earnings or is
likely to otherwise seriously prejudice the interests of the bank's depositors
or trust company's clients, the commissioner may issue a temporary order
requiring the bank or trust company to cease and desist from any such
practice or violation. The order shall contain a notice of charges with a
statement of the facts that forms the basis for a proposed temporary cease
and desist order. Such order shall be effective upon service on the bank or
trust company and shall remain effective and enforceable pending the
completion of the proceedings pursuant to such notice and until such time
as the state banking board shall dismiss dismisses the charges specified in
such notice, or, if a cease and desist order is issued against the bank or
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trust company, until the effective date of any such order.
Sec. 6. K.S.A. 9-2011 is hereby amended to read as follows: 9-2011.
(a) It shall be unlawful for any individual, firm or corporation to advertise,
publish or otherwise promulgate that the such individual, firm or
corporation is engaged in the banking business or trust business without
first having obtained authority from the commissioner, unless its deposits
are federally insured and either chartered in Kansas, another state or the
federal government.
(b) It shall be unlawful for any individual, firm or corporation to
advertise, publish or otherwise communicate that such individual, firm or
corporation is engaged in the trust business without first having obtained
authority from the commissioner, unless the entity is a federally insured
bank or credit union and has authorization from another state or the
federal government to engage in trust business in Kansas.
(c) Any such individual or member of any such firm or officer of any
such corporation violating this section, upon conviction, shall be guilty of
a class A, nonperson misdemeanor.
Sec. 7. K.S.A. 2024 Supp. 9-2107 is hereby amended to read as
follows: 9-2107. (a) As used in this section:
(1) "Contracting trustee" means any trust company, as defined in
K.S.A. 9-701, and amendments thereto, any bank that has been granted
trust authority by the commissioner under K.S.A. 9-1602 9-1601, and
amendments thereto, any national bank chartered to do business in Kansas
that has been granted trust authority by the comptroller of the currency
under 12 U.S.C. § 92a, any bank that has been granted trust authority or
any trust company, regardless of where such bank or trust company is
located, that is controlled, as defined in K.S.A. 9-1612, and amendments
thereto, by the same bank holding company as any trust company, state
bank or national bank chartered to do business in Kansas, which that
accepts or succeeds to any fiduciary responsibility as provided in this
section;
(2) "originating trustee" means any trust company, bank, national
banking association, savings and loan association or savings bank that has
trust powers and places or transfers any fiduciary responsibility to a
contracting trustee as provided in this section; and
(3) "financial institution" means any bank, national banking
association, savings and loan association or savings bank that has its
principal place of business in this state but that does not have trust powers.
(b) Any contracting trustee and any originating trustee may enter into
an agreement by which the contracting trustee, without any further
authorization of any kind, succeeds to and is substituted for the originating
trustee as to all fiduciary powers, rights, duties, privileges and liabilities
with respect to all accounts for which that the originating trustee serves in
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43 SB 139 11
any fiduciary capacity, except as may be provided otherwise in the
agreement. Notwithstanding the provisions of this section, either the
contracting trustee or the originating trustee shall have its principal place
of business in this state.
(c) Unless the agreement expressly provides otherwise, upon the
effective date of the substitution:
(1) The contracting trustee shall be deemed to be named as the
fiduciary in all writings, including, without limitation, trust agreements,
wills and court orders, which that pertain to the affected fiduciary
accounts; and
(2) the originating trustee is absolved from all fiduciary duties and
obligations arising under from such writings and shall discontinue the
exercise of any fiduciary duties with respect to such writings, except that
the originating trustee is not absolved or discharged from any duty to
account required by K.S.A. 59-1709, and amendments thereto, or any
other applicable statute, rule of law, rules and regulations or court order,
nor shall the originating trustee be absolved from any breach of fiduciary
duty or obligation occurring prior to the effective date of the agreement.
(d) The agreement may authorize the contracting trustee:
(1) To establish a trust service desk at any office of the originating
trustee at which the contracting trustee may conduct any trust business and
any business incidental thereto and which the contracting trustee may
otherwise conduct at its principal place of business; and
(2) to engage the originating trustee as the agent of the contracting
trustee, on a disclosed basis to customers, for the purposes of providing
administrative, advertising and safekeeping services incident to the
fiduciary services provided by the contracting trustee.
(e) Any contracting trustee may enter into an agreement with a
financial institution providing that the contracting trustee may establish a
trust service desk as authorized by subsection (d) in the offices of such
financial institution and which provides that such financial institution, on a
disclosed basis to customers, may act as the agent of contracting trustee for
purposes of providing administrative services and advertising incident to
the fiduciary services to be performed by the contracting trustee.
(f) No activity authorized by subsections (b) through (e) shall be
conducted by any contracting trustee, originating trustee or financial
institution until an application for such authority has been submitted to and
approved by the commissioner. The application shall be in the form and
contain the information required by the commissioner, which and shall, at
a minimum, include certified copies of the following documents:
(1) The agreement;
(2) the written action taken by the board of directors of the
originating trustee or financial institution approving the agreement;
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(3) all other required regulatory approvals; and
(4) proof of publication of notice that the applicant intends to file or
has filed an application pursuant to this section. The notice shall be
published in a newspaper of general circulation in the county where the
principal office of the originating trustee or financial institution is located.
The notice shall be in the form prescribed by the commissioner and shall
contain the name of the applicant contracting trustee and the originating
trustee, and a solicitation for written comments. The notice shall be
published on the same day for two consecutive weeks and provide for a
comment period of not less than 10 days after the date of the second
publication; and
(5)(3) a certification by the parties to the agreement that written
notice of the proposed substitution was sent by first-class mail to each co-
fiduciary, each surviving settlor of a trust, each ward of a guardianship,
each person that has sole or shared power to remove the originating trustee
as fiduciary and each adult beneficiary currently receiving or entitled to
receive a distribution of principle or income from a fiduciary account
affected by the agreement, and that such notice was sent to each such
person's address as shown in the originating trustee's records. An
unintentional failure to give such notice shall not impair the validity or
effect of any such agreement, except that an intentional failure to give
such notice shall render the agreement null and void as to the party not
receiving the notice of substitution.
(g) If the originating trustee or financial institution is transferring
more than 50% of the financial institution's total fiduciary accounts, the
commissioner shall require the following certified copies in addition to the
requirements described in subsection (f):
(1) The written action taken by the board of directors of the
originating trustee or financial institution approving the agreement; and
(2) proof of publication of notice that the applicant intends to file or
has filed an application pursuant to this section. The notice shall be
published in a newspaper of general circulation in the county where the
principal office of the originating trustee or financial institution is located.
The notice shall be in the form prescribed by the commissioner and shall
contain the name of the applicant contracting trustee and the originating
trustee and a solicitation for written comments. The notice shall be
published on the same day and every day thereafter for two consecutive
weeks and provide for a comment period of not less than 10 days after the
date of the second publication.
(h) A contracting trustee making application to the commissioner for
approval of any agreement pursuant to this section shall pay to the
commissioner a fee, in an amount established pursuant to K.S.A. 9-1726,
and amendments thereto, to defray the expenses of the commissioner in
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the examination and investigation of the application. The commissioner
shall remit all moneys received under this section to the state treasurer in
accordance with the provisions of K.S.A. 75-4215, and amendments
thereto. Upon receipt of each such remittance, the state treasurer shall
deposit the entire amount in the state treasury to the credit of the bank
investigation fund. The moneys in the bank investigation fund shall be
used to pay the expenses of the commissioner, or designee, in the
examination and investigation of such applications and any unused balance
shall be transferred to the bank commissioner fee fund.
(h)(i) Upon the filing of a complete application with the
commissioner, the commissioner shall make or cause to be made, a careful
examination and investigation of the proposed agreement. If the
commissioner finds any of the following matters unfavorably, the
commissioner may deny the application:
(1) The reasonable probability of usefulness and success of the
contracting trustee; and
(2) the financial history and condition of the contracting trustee
including the character, qualifications and experience of the officers
employed by the contracting trustee.
(i)(j) The commissioner shall render approval or disapproval of the
application within 90 days of receiving a complete application.
(j)(k) Upon service of an order denying an application, the applicant
shall have the right to a hearing to be conducted in accordance with the
Kansas administrative procedure act before the state banking board. Any
final order of the commissioner pursuant to this section is subject to
review in accordance with the Kansas judicial review act.
(k)(l) When the commissioner determines that any contracting trustee
domiciled in this state has entered into a contracting agreement in violation
of the laws governing the operation of such contracting trustee, the
commissioner may take such action as available under K.S.A. 9-1714, 9-
1805, 9-1807 or 9-1809, and amendments thereto, to remedy such
violation.
(l)(m) Any party entitled to receive a notice under subsection (f)(5)
(3) may file a petition in the court having jurisdiction over the fiduciary
relationship, or if none, in the district court in the county where the
originating trustee has its principal office, seeking to remove any
contracting trustee substituted or about to be substituted as fiduciary
pursuant to this section. Unless the contracting trustee files a written
consent to its removal or a written declination to act subsequent to the
filing of the petition, the court, upon notice and hearing, shall determine
the best interest of the petitioner and all other parties concerned and shall
fashion such relief as the court deems appropriate in the circumstances,
including the awarding of reasonable attorney fees. The right to file a
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petition under this subsection shall be in addition to any other rights to
remove the fiduciary provided by any other statute or regulation or by the
writing creating the fiduciary relationship. If the removal of the fiduciary
is prompted solely as a result of the contracting agreement, any reasonable
cost associated with such removal and transfer shall be paid by the
originating trustee or financial institution entering into the agreement.
Sec. 8. K.S.A. 9-2108 is hereby amended to read as follows: 9-2108.
It is unlawful for any trust company to establish or operate a trust service
office or relocate an existing trust service office except as provided herein.
(a) As used in this section: "Trust service office" means any office,
agency or other place of business located within this state, other than the
place of business specified in the trust company's certificate of authority, at
which the powers granted to trust companies under K.S.A. 9-2103, and
amendments thereto, are exercised. For the purposes of this section, any
activity in compliance with K.S.A. 9-2107, and amendments thereto, does
not constitute a trust service office.
(b) After first applying for and obtaining the approval of the
commissioner under this section, one or more trust service offices may be
established or operated in any city within this state by a trust company
incorporated under the laws of this state.
(c) An application to establish or operate a trust service office or to
relocate an existing trust service office shall be in the form and manner
prescribed by the commissioner and provide the following documents:
(1) A certified copy of the written action taken by the board of
directors of the trust company approving the establishment or operation of
the proposed trust service office or the proposed relocation of the trust
service office;
(2) all other required regulatory approvals;
(3) proof of publication of notice that the applicant intends to file or
has filed an application pursuant to this section. The notice shall be
published in a newspaper of general circulation where the proposed trust
service office is to be located. The notice shall be in the form prescribed by
the commissioner and shall contain the name of the applicant, the location
of the proposed trust service office and a solicitation for written comments.
The notice shall be published on the same day and every day thereafter for
two consecutive weeks and provide for a comment period of not less than
10 days after the date of the second publication; and
(4) the application shall include the name selected for the proposed
trust service office. The name selected for the proposed trust service office
shall not be the same or substantially similar to the name of any other trust
company or trust service office doing business in the state of Kansas, nor
shall the name selected be required to contain the name of the applicant
trust company. If the name selected for the proposed trust service office
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does not contain the name of the applicant trust company, the trust service
office shall provide in the public lobby of such trust service office, a public
notice that it is a trust service office of the applicant trust company. Any
trust company may request an exemption from the commissioner from the
provisions of this subsection.
(d) A trust company making application to the commissioner for
approval of a trust service office under this section shall pay to the
commissioner a fee, in an amount established pursuant to K.S.A. 9-1726,
and amendments thereto, to defray the expenses of the commissioner in
the examination and investigation of the application. The commissioner
shall remit all moneys received under this section to the state treasurer in
accordance with the provisions of K.S.A. 75-4215, and amendments
thereto. Upon receipt of each such remittance, the state treasurer shall
deposit the entire amount in the state treasury to the credit of the bank
investigation fund. The moneys in the bank investigation fund shall be
used to pay the expenses of the commissioner or designee in the
examination and investigation of such applications and any unused balance
shall be transferred to the bank commissioner fee fund.
(e) Upon the request of any trust company proposing to relocate an
existing trust service office to less than one mile 10 miles from the trust
company's existing location, the commissioner may exempt such trust
company from the requirements of this section. If an exemption is
provided under this subsection, each trust company shall document the
written action taken by the board of directors of the trust company
approving the proposed relocation of the trust service office and all other
required regulatory approvals.
(f) Upon the filing of a complete application with the commissioner,
the commissioner shall make or cause to be made, a careful examination
and investigation. If the commissioner finds any of the following matters
unfavorably, the commissioner may deny the application:
(1) The reasonable probability of usefulness and success of the
proposed trust service office; and
(2) the applicant trust company's financial history and condition
including the character, qualifications and experience of the officers
employed by the trust company.
(g) Upon service of an order denying an application, the applicant
shall have the right to a hearing to be conducted in accordance with the
Kansas administrative procedure act before the state banking board. Any
final order of the state banking board pursuant to this section is subject to
review in accordance with the Kansas judicial review act.
(h) When the commissioner determines that a trust company
domiciled in this state has established or is operating a trust service office
in violation of the laws governing the operation of such trust company, the
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commissioner may take such action as available under K.S.A. 9-1714, 9-
1805, 9-1807 or 9-1809, and amendments thereto, to remedy such
violation.
Sec. 9. K.S.A. 9-2111 is hereby amended to read as follows: 9-2111.
(a) Except as provided in K.S.A. 9-2107, and amendments thereto, no trust
company, trust department of a bank, corporation or other business entity,
the with a home office of which is located outside the state of Kansas,
shall establish or operate a trust facility within the state of Kansas, unless
the laws of the state where the home office of the nonresident trust
company, trust department of a bank, corporation or other business entity
is located authorize a Kansas chartered Kansas-chartered trust company,
trust department of a bank, corporation or other business entity to establish
or operate a trust facility within that state. The commissioner may require
any nonresident trust company to meet the greater of the requirements
stated under the banking code or the laws of the nonresident trust
company's home state required for a Kansas trust company to do business
in the nonresident trust company's home state.
(b) Before any nonresident trust company, trust department of a bank,
corporation or other business entity establishes a trust facility in Kansas, a
copy of the application submitted to the home state, and proof that the
home state authorizes a Kansas chartered Kansas-chartered trust company,
trust department of a bank, corporation or other business entity to establish
or operate a trust facility within that state, must shall be filed by the
applicant with the commissioner.
(c) No Kansas trust company shall establish an out-of-state trust
facility until an application has been filed with the commissioner and
approval has been received. An application filed pursuant to this section
shall be subject to the provisions in K.S.A. 9-2108, and amendments
thereto.
(d) No Kansas bank with a trust department shall establish an out-of-
state trust facility until an application has been filed with the commissioner
and approval has been received. An application filed pursuant to this
section shall be subject to the provisions in K.S.A. 9-1111, and
amendments thereto.
(e) As used in this section, "trust facility" means any office, agency,
desk or other place of business at which trust where business is conducted.
(f) Any Kansas trust company or Kansas bank making application to
the commissioner pursuant to subsection (c) or (d) shall pay to the
commissioner a fee to be established pursuant to K.S.A. 9-1726, and
amendments thereto, to defray the expenses of the commissioner in the
examination and investigation of the application. The commissioner shall
remit all moneys received under this section to the state treasurer in
accordance with the provisions of K.S.A. 75-4215, and amendments
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thereto. Upon receipt of each such remittance, the state treasurer shall
deposit the entire amount in the state treasury to the credit of the bank
investigation fund. The moneys in the bank investigation fund shall be
used to pay the expenses of the commissioner in the examination and
investigation of such applications and any unused balance shall be
transferred to the bank commissioner fee fund.
Sec. 10. K.S.A. 9-519, 9-1111, 9-1114, 9-1724, 9-1807, 9-2011, 9-
2101, 9-2108, 9-2111 and 16-842 and K.S.A. 2024 Supp. 9-2107 are
hereby repealed.
Sec. 11. This act shall take effect and be in force from and after its
publication in the statute book.
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