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Banking Interpretations

NYSBL 226 

February 9, 2006

[ ]

Re: Interstate Branching

Dear [ ]:

Your inquiry to the New York State Banking Department, regarding the trust powers of the New York branches of your client, a Pennsylvania state-chartered savings bank (“the Bank”), has been referred to me for response. You state that the New York branches were the result of an acquisition of a New York headquartered bank by the Bank a few years ago. You also state that the Bank has a full service trust department in Pennsylvania and has been granted unrestricted trust powers under Pennsylvania Law. You explain in your letter that the Bank would like to offer its trust services to its customers of the New York branches and ask whether or not the Bank needs to submit any filings to the Department in order to offer trust services to its clients at the New York branches.

I note that in your letter, you refer to certain filing requirements set forth in Banking Law Section 131.3, which apply to out-of-state banks or trust companies with no New York office that seek to qualify as fiduciaries in New York. Banking Law Section 131.3 begins by saying, “Except as otherwise provided in article five or five-C of this chapter, …..”. You explain in your letter that your client is a Pennsylvania state chartered savings bank that maintains branches in New York. Accordingly, Banking Law Section 226 of Article 5-C would control and Section 131.3 would not apply. Under Banking Law Section 226, “An out-of-state state bank that opens, occupies or maintains a branch in this state as authorized by this article shall have in this state the same powers under the laws of this state as a like-type banking organization.” Since you have explained that the Bank is a state-chartered savings bank in Pennsylvania with unrestricted trust powers under Pennsylvania state law, the Bank would have the same powers as a New York State savings bank with trust powers. As such, the New York branches would be able to provide trust services in New York without making the required filings under Banking Law Section 131.3.

I trust that this has been responsive to your inquiry. Should you have any further questions, please contact me at (212) 709-1674.

Very truly yours,

Megan Prendergast
Associate Attorney