Kansas banking laws regulate finance.
Kansas banking laws help define the character of the state. The Office of the State Bank Commissioner (OSBC) takes the lead in educating about the state's banking laws and regulations. In doing so, it's hoped that fairness in banking conduct will result with the consumer being protected from unscrupulous activities.
Historical Law
A state law passed in 1891 has been called the start of a renaissance in Kansas banking, notes the book "Kansas: A Cyclopedia of State History." With the passing of the law, the office of a bank commissioner was created, and just six years later, a more comprehensive law comprising 65 articles was passed, which included the establishment of fines for delinquent banking officers as well as further explanation of the bank commissioner's duties.
Kansas Banking Code
The banking law code most recently published by Kansas' OSBC (2009) outlines major laws that regulate modern banking activity. For example, all Kansas banks incorporated after July 1, 1975, must have at least $250,000 in capital. If it's observed that the bank fails in meeting this minimum, the bank commissioner will notify the bank and give it 90 days upon receipt of notice to restore its capital.
Limitations imposed on Kansas banks include being prevented from investing in the stock of another bank or corporation, unless given specific authorization from the banking commissioner.
Banking officers, directors, agents and employees guilty of violating banking laws will be subject to misdemeanor charges and a maximum penalty of $1,000 a year in prison or both.
Banking Administrative Regulations
As banks grow in their business, they must comply with administrative regulations as established by state law. For example, in what is called "financial modernization," or the acquiring of additional commercial interests that go beyond traditional deposit-and-withdrawal banking, a bank must provide written notice to the banking commissioner, which details how the bank will take control of additional entities and in what percentage.
Further, strict documentation regarding the bank's interests and activities must be kept and maintained throughout each year. Examples include recorded minutes of stockholders' and directors' meetings, as well as records regarding loans, bonds, bank-owned real estate and insured bank property.
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