In this subtitle the following words have the meanings indicated. “Affiliate” means any company that controls, is controlled by, or is under common control with another company. “Bank” has the meaning stated in the Federal Deposit Insurance Act, 12 U.S.C. § 1813(a)(1). “Bank supervisory agency” means: The Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation, the Board of Governors of the Federal Reserve System, or any successor to these agencies; or An agency of another state with primary responsibility for chartering and supervising banks. “Branch” means a bank office open to the public at which deposits are received, checks are paid, or money is lent. “Branch” includes a mobile branch or other special-purpose facility that performs a function of a branch. “Branch” does not include an automated teller machine as defined in § 1-401 of this article. “Commercial activities” means activities in which a bank holding company, a financial holding company, a national bank, or a national bank financial subsidiary may not engage under federal law. “De novo branch” means a branch of an out-of-state bank or banking institution that: Is originally established by the out-of-state bank or banking institution as a branch; and Does not become a branch of the out-of-state bank or banking institution as a result of: The acquisition by the out-of-state bank or banking institution of an insured depository institution or a branch of an insured depository institution; or The conversion, merger, or consolidation of an insured depository institution or a branch of an insured depository institution. “Home state” means: As to a national banking association, the state in which its main office is located; and As to a state-chartered bank, the state by which it is chartered. “Home state regulator” means the agency in a bank’s home state with primary responsibility for chartering and regulating banks. “Host state” means a state, other than the home state of a bank, in which the bank maintains or seeks to establish a branch. “Insured depository institution” means any financial institution the deposits of which are insured by the Federal Deposit Insurance Corporation. “National banking association” means a bank chartered under the National Bank Act. “Other-state bank” means a bank chartered and primarily regulated by another state. “Out-of-state bank” means: A national banking association with its main office in a state other than this State; or An other-state bank.

This subtitle sets forth the conditions under which: An out-of-state bank may establish branches in this State; and A banking institution may establish branches within or outside this State.

A banking institution or an out–of–state bank may establish a branch in this State by: Subject to subsection (b) of this section, opening a de novo branch; Purchasing an existing branch from a bank or an insured depository institution; or Converting former headquarters or retaining former branches following: The purchase of all or substantially all of the assets of a bank or an insured depository institution; or A merger or a consolidation with a bank or an insured depository institution. An out–of–state bank may establish a de novo branch in this State under subsection (a)(1) of this section only if the home state of the out–of–state bank allows a banking institution to open a de novo branch in its state. A banking institution or an out–of–state bank may not establish or maintain a branch in this State on the premises or property of an affiliate if the affiliate engages in commercial activities.

A banking institution may establish a branch in another state by any means permitted by the laws of that state or by federal law.

Except as provided in subsection (b) of this section, a banking institution that proposes to establish a branch in this State or in another state shall: File with the Commissioner, at least 30 days before the intended opening date, a notice of intention to open a branch; and Submit to the Commissioner any information the Commissioner requires in order to evaluate the proposed branch. A well–capitalized banking institution with a composite CAMELS rating of one or two may establish a branch in this State by filing with the Commissioner an expedited notice, in the form that the Commissioner requires, at least 30 days before the intended opening date.

Subject to subsection (b) of this section, in deciding whether to approve a branch of a banking institution, the Commissioner shall consider: If the branch is to be established in this State, whether the establishment of the branch will promote the public convenience; Whether the applicant has sufficient capital to support the branch; and Whether the applicant is generally operating in compliance with the provisions of this article. Subject to paragraph (2) of this subsection, a well–capitalized banking institution with a composite CAMELS rating of one or two may open a branch in this State without the approval of the Commissioner 30 days after filing an expedited notice for the proposed branch under § 5–1005(b) of this subtitle. The Commissioner may: Require the submission of additional information regarding the proposed establishment of a branch during the 30–day period that the expedited notice is pending; and Prohibit the establishment of the branch within the 30–day period if the Commissioner determines that establishment of the branch is not consistent with the standards set forth in subsection (a) of this section.

The Commissioner shall decide whether to approve the establishment of a branch of a banking institution within 30 days of receipt of the notice specified in § 5-1005 of this subtitle. A branch shall be deemed approved if the Commissioner takes no action on the notice within the time limit specified in this section.

A banking institution that establishes a branch in another state may exercise at that branch all powers and rights permitted to banks in that state unless the Commissioner determines that the exercise of a power or right would threaten the safety and soundness of the banking institution. An other-state bank that establishes a branch in this State may exercise at the branch all powers and rights permitted to banking institutions in this State notwithstanding any other law of this State to the contrary, unless that bank’s home state regulator determines that the exercise of a power or right would threaten the safety and soundness of the other-state bank. Any person authorized by a law of this State to engage in business with banks located in this State, including the making of deposits, is authorized to engage in the same business with an other-state bank at that other-state bank’s branch in this State.

Subject to § 5-1012 of this subtitle, the Commissioner shall have the power to examine every branch of an other-state bank located in this State for the same purposes and to the same extent as the Commissioner may examine a branch of a banking institution. The Commissioner may enter into agreements with bank supervisory agencies regarding the scope, timing, coordination, and frequency of examinations and other supervisory matters, including the sharing of information obtained through examination of other-state banks that maintain branches in this State. Supervisory and examination fees related to the Commissioner’s oversight of Maryland branches of other-state banks and branches of banking institutions in other states may be imposed and shall be calculated in the manner agreed to between the Commissioner and the home state regulators.

Subject to § 5-1012 of this subtitle, if the Commissioner finds that a branch of an other-state bank in this State is being operated in an unsafe or unsound manner or there is any violation of Maryland law by the branch of the other-state bank, the Commissioner may undertake enforcement actions as otherwise authorized under provisions in this article governing banking institutions. The Commissioner may enter into joint enforcement actions with other bank supervisory agencies having concurrent jurisdiction over an other-state bank that has a branch in this State.

Subject to § 5-1012 of this subtitle, the Commissioner may require a bank that maintains a branch in this State to submit to the Commissioner its consolidated reports of condition and income in the form specified by the Federal Financial Institutions Examination Council.

With respect to the supervision, enforcement, and reporting requirements of §§ 5-1009, 5-1010, and 5-1011 of this subtitle, the Commissioner shall act primarily in cooperation with the home state regulator or federal regulator of the affected out-of-state bank.

Except as provided in this section, the Commissioner may not approve a transaction resulting in the establishment of a branch or branches by a bank, other than a de novo branch, if on consummation of the transaction the applicant, including any insured depository institution affiliate of the applicant, would control 30 percent or more of the total amount of deposits of insured depository institutions in this State. The Commissioner may by regulation adopt a procedure by which the 30 percent deposit limit may be waived for good cause.

An out-of-state bank that proposes to establish a branch in this State: Shall qualify under § 7-203 of the Corporations and Associations Article to do business in the State as a foreign corporation; and Within 15 days of filing a branch application with the appropriate bank supervisory agency, shall provide the Commissioner with a copy of the branch application. An out-of-state bank that does not have a branch in this State on September 29, 1995, may not establish a branch in this State before June 1, 1997, unless the laws of that bank’s home state would permit a banking institution to establish a branch in that state under substantially similar conditions as those imposed by this subtitle. An out-of-state bank that has a branch in this State may establish additional branches in this State to the same extent as a banking institution or to the extent otherwise permitted by federal law.

If any provision of this subtitle or the application thereof to any person or circumstance is held invalid for any reason in a court of competent jurisdiction, the invalidity does not affect other provisions or any other application of this subtitle that can be given effect without the invalid provision or application.