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Adopted Regulations
Summary of Changes to Part 6 of the General Regulations of the Banking Board

May 10, 1999


RE: Final Adoption of Amendments to Part 6 of the General Regulations of the Banking Board to Allow Self-Certification of Equity Investments Promoting the Public Welfare.

At its May 6, 1999 meeting, the Banking Board adopted as final the attached amendments to Part 6 of the General Regulations of the Banking Board. The amendment will become effective upon its publication in the State Register on June 3, 1999.

The adopted amendment will provide New York State-chartered banks parity with national banks, utilizing New York’s Wildcard authority. The change would allow state-chartered banks to self-certify equity investments that are designed primarily to promote the public welfare, including the welfare of low- and moderate-income areas or individuals.

To be eligible for this treatment, such equity investments must provide or support activities, services, or facilities that primarily promote the public welfare. This would include affordable housing, community services, permanent jobs for low- and moderate-income individuals, equity or debt financing for small businesses, and area revitalization.

Under the amendment, to qualify for self-certification, a bank or trust company must meet four criteria. It must: be well-capitalized; have a composite rating of 1 or 2 under the Uniform Financial Institutions Rating System; not be the subject of any regulatory order or agreement; and have a CRA rating of at least "satisfactory."

This amendment will have at least two benefits. First, it will eliminate burdens on qualifying banks and trust companies because they will not have to submit an application to the Banking Board, pursuant to section 97(5) of the Banking Law, for each such investment, as is presently the case. In addition, it will encourage increased investments in activities that are beneficial to low- and moderate-income areas and individuals.

The Office of the Comptroller of the Currency has allowed self-certification of eligible investments that benefit low- and moderate-income individuals or areas by national banks since 1993. The ability to self-certify was broadened by revisions to Part 24 of the Code of Federal Regulations that became effective on October 23, 1996. The amendment to Part 6 of the General Regulations of the Banking Board will create parity between state and national banks in their ability to self-certify equity investments promoting the public welfare. 

Very truly yours,

John A. Joyce, Esq.
Secretary of the Banking Board

Department of Financial Services


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