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Banking Interpretations

Banking Law §594

January 24, 2003

RE:     Request for Opinion -- Matter No. 02-304

Dear                    : 

Your November 6, 2002 letter to the Office of Counsel of the New York State Banking Department has been referred to me for response.  Your client, a New York State registered mortgage broker ("Client"), proposes to change its corporate structure from an S corporation to a limited liability company ("LLC"), maintaining basic management and substantially similar ownership.  You have stated that Client will notify the Banking Department upon the change of its name and ask if there are any additional approvals, applications, notifications or filings that are required to be made with the Banking Department in connection with the proposed change in corporate structure.   

Based upon the facts presented in your letter, it does not appear that any additional approvals, applications, notifications or filings are required to be made with the Banking Department.  However, when Client restates the "titles" of its owners, directors and executive officers (e.g., stockholders become members and directors become managing members), I believe this would constitute a change as contemplated by §594 of the New York State Banking Law (the "Banking Law") and Client must submit the new information to the Superintendent.  Additionally, the information required by §594 of the Banking Law must be provided for any new members of the LLC.  Lastly, Client should submit a copy of the Articles of Organization and Operating Agreement for the new LLC to the mortgage banking division of the Banking Department.   

I trust that this letter is responsive to your inquiry.   

Very truly yours, 

Jacquelyn A. Hart
Associate Counsel

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