Banking and Finance

P Passed

P HB1579
Banking; settlement agents; kickbacks. Allows owners of a settlement service provider to receive payments based on ownership interests, as well as payments representing a bona fide salary or compensation or other payments for services actually performed for the business of the settlement service provider. Presently, these payments are only afforded to owners of a settlement agent.
Patron - Davies

P HB1879
Banking and finance; registered check cashers. Requires registered check cashers to give prompt notice of office openings, closings, and relocations. The bill changes the one-time "registration" fee to an application fee, and provides for annual registration fees not exceeding $250 to be set by the State Corporation Commission.
Patron - Keating

P HB1938
Banking and finance; certificate of authority of a savings association to do business. Eliminates the requirement that organizing savings institutions establish a separate capital account labeled "reserve for operation" prior to receiving a certificate of authority from the State Corporation Commission. Financial reports do not normally provide such reserves, and including these reserves is in violation of Generally Accepted Accounting Procedures (GAAP).
Patron - Morgan

P HB1949
Banking and finance; finance charges under closed-end installment plans. Allows, under a closed-end installment plan, a seller of commercial vehicles and equipment to charge and collect from a purchaser a document fee for the preparation, handling and processing of documents relating to the purchase of such vehicle or equipment. The fee is not considered a finance charge.
Patron - Shuler

P HB2074
Banking and finance; joint accounts; required disclosures. Requires financial institutions to provide disclosure forms informing persons opening joint accounts of the disposition of such accounts upon a party's death. Disclosures concerning a "Joint Account With Survivorship" must inform such persons that on the death of a party to the account, the deceased party's ownership in the account passes to the surviving party or parties to the account. Disclosures concerning a "Joint Account--No Survivorship" must inform such persons that on the death of a party to the account, the deceased party's ownership in the account passes as a part of the party's estate under the party's will or trust, or by intestacy. This bill will become effective on July 1, 2000.
Patron - Dickinson

P HB2250
Banking and finance; bank branches. Allows the State Corporation Commission ("SCC") to authorize banks to establish branches when the SCC is satisfied that (i) the "safety and soundness" of the bank will not be impaired by the expansion and (ii) that such authorization will not be detrimental to the public interest. Under current law, the SCC applies a "public interest" test prior to approving such expansion. The bill also establishes SCC timetables for action on any such branching application.
Patron - Woodrum

P HB2251
Multistate trust institutions. Enables Virginia trust companies, trust subsidiaries and state banks to open trust offices in other states and permits out-of-state trust institutions and national banks whose home state is other than Virginia to open trust offices in Virginia. An out-of-state trust institution or national bank whose home state is other than Virginia can begin to engage in providing trust services in Virginia, either through acquisition of an existing Virginia trust company or by establishing its own trust offices or bank branches. The home state of the out-of-state trust company or bank seeking to enter Virginia must offer reciprocity to Virginia trust companies and banks. Applications for Virginia trust companies and banks to open offices in other states and for out-of-state trust companies and banks planning to open offices in Virginia must be approved by the State Corporation Commission. The State Corporation Commission is authorized to examine the records of an out-of-state trust company or bank in Virginia. The State Corporation Commission will promulgate regulations to implement the provisions of this bill.
Patron - Woodrum

P HB2494
Banking and finance; charges by banks and savings institutions; installment loans. Provides that notwithstanding any statute or law relating to interest or usury, including the deferral and capitalization of interest, any loan made by a bank or savings institution to defray educational expenses, including, but not limited to, tuition, fees, books, supplies, room, board, and personal expenses, shall be lawfully enforced as agreed in the contract of indebtedness.
Patron - Deeds

P HB2600
Real estate settlements; disclosure of affiliated business by settlement service providers. Requires any person making a referral to an affiliate settlement service provider to disclose the affiliation in accordance with the federal Real Estate Settlement Procedures Act of 1974 (RESPA), and to provide such disclosure regardless of the amount of the person's actual ownership interest in the affiliated provider. The disclosure is not required where such ownership is one percent or less of the capital stock of a corporation or entity with a class of securities registered under the Securities Exchange Act of 1934 (14 U.S.C. § 78a et seq.).
Patron - Deeds

P HB2708
Medical savings accounts. Authorizes financial institutions within the Commonwealth of Virginia to establish medical savings accounts in accordance with federal law. The bill also requires the Joint Commission on Health Care, assisted by the Board of Insurance and the Department on Taxation, to study the current federal and state taxation and insurance laws to determine the feasibility of licensing group self-insurance associations that will pool their liabilities for the purpose of offering high deductible, catastrophic health insurance coverage to holders of medical savings accounts. The Joint Commission on Health Care will submit its findings to the Governor and the 2000 General Assembly.
Patron - Cantor

P SB897
Banking and finance; investment in stock or securities of controlled subsidiary corporations. Clarifies that all controlled subsidiaries of Virginia banks may charge such interest, finance charges, etc., as the parent bank could charge, and that this ability is not limited to bank subsidiaries engaged in international banking.
Patron - Holland

P SB959
Finance charges by sellers of goods and services; discharge of security interests of liens; premiums for property insurance. Stipulates that with regard to a closed-end installment plan established in connection with the sale of goods or services: (i) the amount paid by a seller to discharge a security interest or lien on property traded in may be made subject to finance charges, (ii) the payment by a lessor to discharge a security interest or lien on the property traded in may be included in the gross capitalized cost of the goods leased, and does not constitute a loan, and (iii) premiums for vendor's single interest property insurance on goods leased or purchased will not be treated as additional charges for the extension of credit, if the seller or lessor (a) discloses the cost of the insurance if purchased from or through the seller or lessor and (b) advises the buyer or lessee that he may purchase such insurance from the person of his choice.
Patron - Stosch

P SB1019
Credit unions; membership. Revises provisions of the Virginia Credit Union Act relating to fields of membership and eligibility for membership in state credit unions, so as to attain substantial parity with the Federal Credit Union Act (as amended by HR 1151 in August 1998). The changes permit multiple common-bond fields of membership, within limits; restrict community-based fields of membership to "well-defined, local communities, neighborhoods or rural districts"; and make persons within the "immediate family" or "household" of individuals who are eligible for credit union membership also eligible. The bill also directs the State Corporation Commission (Bureau of Financial Institutions) to consider federal agency rules and policies on these subjects, but allows the State Corporation Commission discretion in applying such rules and policies.
Patron - Colgan

P SB1071
Money order sales; designation of payees. Prohibits the sale of money orders with face amounts of $750 or more that do not specify the name of the payees. This bill is not applicable to travelers checks, electronic instruments, stored value products, or other similar instruments. Insured financial institutions are exempt from the provisions of the bill.
Patron - Stolle

P SB1278
Real estate settlement practices; real estate settlement agent registration. Establishes the Real Estate Settlement Agent Registration Act, governing the qualifications and financial responsibility obligations of persons conducting real estate settlements not covered by the Consumer Real Estate Settlement Protection Act (CRESPA). Under the provisions of this bill, lay settlement agents (defined as a person who is not a licensed attorney or a party to a real estate transaction and provides closing or settlement services in a real estate transaction) must comply with the requirements of CRESPA.
Patron - Barry

F Failed

F HB1829
CRESPA; standards and financial responsibility. Provides that settlement agents may apply for a waiver of the required $100,000 blanket fidelity bond or employee dishonesty insurance policy covering persons employed by the settlement agent when the settlement agent has no employees other than owners, partners, shareholders or members who have authorized access to the settlement agent's trust account or other similar fiduciary duties.
Patron - Phillips

F HB2467
Banking and finance; check cashers; deferred deposit agreements. Authorizes check cashers to accept checks for encashment on a deferred deposit basis. This authorization permits check cashers to cash a customer's check immediately, while agreeing, however, to deposit the check at some time in the future. The bill requires deferred deposit agreements to be in writing, and the agreement must specify any and all charges associated with the agreement. Additionally, the fee charged for the deferred deposit transaction may not exceed 15 percent of the check's face value. In the event that the check, when eventually deposited, is returned for insufficient funds, the check casher may also recover any civil damages allowed (i) by law for bad checks or (ii) by contract between the check casher or any assignee of the check casher and the customer. Finally, the bill provides that a customer who enters into a deferred deposit agreement and offers a personal check to a check casher pursuant to that agreement will not be subject to any criminal penalty for his failure to comply with the terms of that agreement.
Patron - Keating

F HB2510
Consumer Finance Act; licensing; real estate brokers and salespersons. Declares that the recourse purchase of an entitlement on the part of a real estate broker or real estate salesperson licensed pursuant to Chapter 21 (§ 54.1-2100 et seq.) of Title 54.1 to receive a commission arising from the sale or lease of real property, shall not be deemed to constitute the making of a loan or engagement in the business of lending by the purchaser. Consequently, no such real estate broker or real estate salesperson is required to be licensed under the Consumer Finance Act under those circumstances.
Patron - Drake

F HB2744
Banking and finance; subordinate mortgage loans; principal amount of loans. Declares that for purposes of determining the loan fee a lender may charge a borrower in conjunction with a subordinate mortgage loan (a loan fee that may not exceed five percent of the principal amount of the loan), the term "principal amount of the loan" is defined to mean the amount on which interest may be charged.
Patron - Wagner

F SB982
Credit cards; charges for credit insurance after cancellation of further credit privileges. Prohibits credit card issuers canceling credit privileges under a credit agreement from continuing to add, assess or accrue any charge or charges for credit insurance beyond the effective date of the credit privilege cancellation. The prohibition is imposed irrespective of whether (i) the creditor imposed or the borrower requested such cancellation or (ii) a balance is due under the credit agreement when further credit privileges are canceled. Moreover, any such credit insurance will be deemed canceled concurrent with the cancellation of credit privileges unless the borrower (i) expressly requests its continuation in writing and (ii) authorizes the creditor to add, assess or accrue charges therefor.
Patron - Barry


© 1999 by the Division of Legislative Services.