Banking Interpretations

NYSBL 143-b

Memorandum

To: Economist Kupfer

From: Barbara Kent, Esq.

Date: April 10, 1995

Subject: [ ] Bank --BL S 143-b

On March 21, 1995, after reviewing the proposed merger agreement and a draft opinion from the legal counsel for the [ ] Union, I "tentatively concluded" that the impending merger of the [ ] Union (" [ ] U") with the [ ] Union (" [ ] U") would not constitute a change in control of [ ] (the "Bank") pursuant to section 143-b of the Banking Law. The Bank is currently owned by [ ] U. After the proposed merger, the Bank will be controlled by [ ] U, the post-merger name to be taken by the union.

Counsel for [ ] U has now submitted a formal request for a final determination as to whether the merger of [ ] U and [ ] U would result in a change in control of the Bank that would require an application to the Banking Board pursuant to section 143-b. As you note in your memorandum, after the merger, the expanded Board of Directors of the Bank will include ten individuals who are now affiliated with [ ] U. Previously, it had been anticipated that there would only be seven such individuals. Consequently, one- third, rather than less than one-quarter, of the Bank's 30 member Board of Directors will be individuals currently affiliated with [ ] U.

However, there is no change in the previously proposed membership of the Executive Committee of the Bank's Board of Directors which will be expanded from five members to eight by the addition of three members who are now affiliated with [ ] U. Furthermore, it was and still is contemplated that the representation from [ ] U will eventually expand to 50% of the Bank's Board of Directors. Thus, the increase to ten directors having an [ ] U affiliation does not affect my earlier opinion that "the current officials of [ ] U will continue to have the greater role...on the Board of Directors of the Bank."

Accordingly, for the reasons set forth in my earlier memorandum, I have concluded that for purposes of section 143-b, [ ] U is the same entity as that which presently controls the Bank, [ ] U. Therefore, no application for a change of control is required pursuant to section 143-b of the Banking Law.

Should you wish to discuss this further, please contact me.

BK