§ 7-1-716. Affiliate depository institutions acting as agents -- Notification required.

(1) Any depository institution may, at its main office or at any branch, act as an agent of any other depository institution that is a subsidiary of the same depository institution holding company in conducting the activities authorized under this section.

(2) This section applies regardless of whether the affiliate depository institutions have the same home state.

(3) A depository institution acting as agent for an affiliate depository institution may:

(a) receive deposits;

(b) renew time deposits;

(c) engage in the activities authorized for a loan production office under Section 7-1-715;

(d) service loans; and

(e) receive payments on loans and other obligations.

(4) A depository institution may not do any of the following as an agent on behalf of an affiliate depository institution:

(a) open or originate deposit, savings, or share accounts;

(b) evaluate or approve loans;

(c) disburse loan funds; or

(d) conduct any activity as an agent that it is prohibited from conducting as a principal under any applicable law.

(5) A depository institution acting as a principal may not have an affiliate depository institution act as its agent in conducting any activity that:

(a) the principal depository institution is prohibited from conducting; or

(b) the agent depository institution would be prohibited from conducting as a principal.

(6) An agency relationship between affiliates under this section shall be consistent with safe and sound practices and shall comply with all applicable law.

(7) A depository institution acting as an agent is not considered to be a branch of the affiliate solely because of activities conducted under this section.

Enacted by Chapter 49, 1995 General Session