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Panel unanimously advances bill letting state-chartered banks seek SCC exemptions for dual officers (SB 734)
Summary
SB 734 would let the State Corporation Commission consider petitions from state-chartered banks asking to allow key officers to serve at more than one unaffiliated institution; proponents said the change would align state-chartered banks with federal practice and help rural banks recruit executive talent. The subcommittee reported the bill 8-0.
Sen. Hackworth introduced SB 734 and said current Virginia Code §6.2-104 prohibits some banks from hiring top management who simultaneously serve as directors or officers of another unaffiliated bank, and that the bill would permit state-chartered banks to petition the State Corporation Commission (SCC) for an exemption in appropriate cases.
Hackworth told the panel the proposal is intended to give state banks an avenue to seek SCC approval, similar to the process available to federally chartered institutions, while preserving SEC/SCC oversight of safety and soundness considerations. The senator said the bill would require the SCC, when reviewing petitions, to consider whether institutions compete with each other and whether a locality otherwise lacks capable management.
Matt Bing of the Virginia Bankers Association urged support, saying the bill provides state-chartered banks access to the same exemption process that federal regulators provide and would not interfere with competitiveness or safety and soundness. "For those reasons, we ask you to support the bill," Bing said. Cory Connor of the Virginia Association of Community Banks said the proposal would help rural banks and institutions under the $10 billion threshold access necessary leadership.
No opposition speakers were recorded. The subcommittee moved to report SB 734 as amended; the clerk announced the vote as 8 to 0 in favor. The bill was reported out of the subcommittee by unanimous vote.
