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Banking Interpretations

NYSBL 143-b

Memorandum


May 23, 1985

To: Examiner Modi - DCBD

From: Associate Attorney Bujarski

Re: [ ] Bank - Deeming one spouse to be beneficial owner of other spouse's stock for purposes of B.L. §143-b control.


[ ] owns about 9.975% of the Bank's issued and outstanding stock, while his wife, [ ],owns less than 1%. Aggregating the wife's shares with those of the husband (and vice versa), would bring the [ ] holding to over 10%, and would require a control application pursuant to B.L. §143-b.

In fact, the Legal Division has held in the past that in determining whether control exists solely by reason of ownership of shares, both direct and indirect ownership interests are counted, and that in the case of husband and wife who live in the same household, one will be deemed the indirect owner of the shares of the other. In the instant case, given the amount of stock held by each', it is [ ] who is presumed to be the 10% control stockholder and who will be required to either submit a B.L. §143-b control application or to undertake whatever action may be necessary to bring the combined holdings to below 10%.

The presumption of [ ] control of 10% or more of the Bank's stock may be subject to rebuttal, but the level of proof for such rebuttal would be fairly high.

G. T. B.