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Banking Interpretations

Banking Law §105

November 8, 2005

[ ]

Dear [ ]:

Your letter of July 29, 2005 addressed to Sara Kelsey, Deputy Superintendent and Counsel, has been forwarded to me for a response. I apologize for the delay in responding.

According to your letter, [ ], a federally chartered commercial bank, offers a courier service to your customers in Orange, Ulster and Dutchess Counties. However, the courier service is not operating in certain areas such as the City of Poughkeepsie, City of Middletown and the Town of Wallkill because you are not sure if New York State Law regarding home office protection applies to the activities of the courier service. Therefore, you are asking whether your courier service is subject to the restrictions regarding home office protection contained in Section 105 of the Banking Law.

In general, Section 105 prevents a bank from opening a branch in a city or village (incorporated or unincorporated) with a population of fifty thousand or less in which there is already located the principal office of another bank, trust company, or national banking association (collectively “banking institution”). (Note: home office protection is not available if such banking institution is owned or controlled by a bank holding company, as such term is defined in section 141 of the Banking Law.)

Assuming that the courier service and its activities at the various pick- up locations meet the conditions established by the Office of the Comptroller the Currency for activities related to branching functions that will not be considered a branch under 12 U.S. C. Section 36 (See OCC Interpretive Letter #1023), then there is no issue under Section 105 of the Banking Law regarding home office protection.

I trust this is responsive to your inquiry.

Sincerely, Sharon A. Cherry Associate Attorney

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