Monthly Bulletin – October 2000

State of California

Gray Davis, Governor

Business Transportation and Housing Agency
Maria Contreras-Sweet, Secretary

Department of Financial Institutions

California Seal

Monthly Bulletin

Volume 4, Number 4

October, 2000

Governor Davis Appoints Deputy Commissioner of Credit Unions

Governor Gray Davis announced on October 31, 2000, the appointment of Elizabeth Dooley as the Deputy Commissioner of Credit Unions at the Department of Financial Institutions.

Ms. Dooley, 39, of Yorba Linda, has extensive knowledge of credit unions and the credit union industry. She is employed as associate counsel for the California Credit Union League where she advises credit unions on legal and regulatory matters. Prior to this, Ms. Dooley worked as Treasurer for Dycorp USA Inc., to oversee the financial and accounting activities of retail and mail order business. She also worked for Dean Witter Reynolds Inc., as a stockbroker, having managed a wide array of investments with more than $5 million in assets involving over 400 accounts. Ms. Dooley sits on the Board of Directors for the Women’s Transitional Living Center and is vice president of the Orange County Alumni Association of Mills College. She earned a bachelor of arts degree from Mills College and a juris doctorate degree from the Western State University College of Law.

Industrial Bank Bill Becomes Law

On September 30, 2000, the Governor signed into law Senate Bill 2148 (Polanco), a bill sponsored by the Department. As an urgency bill, SB 2148 became law at that time. The bill transformed deposit taking industrial loan companies into industrial banks, a new classification of banks. Industrial banks now are regulated as banks subject to the Banking Law, and are no longer subject to any of the laws governing industrial loan companies; however, industrial banks are still prohibited from accepting demand deposits.

It should be noted that this new law does not alter the regulation of insurance premium finance agencies. Insurance premium finance agencies remain specialized industrial loan companies subject to the applicable provisions of Division 7. If you have any questions or need any clarification regarding the new law, please feel free to contact Ken Sayre-Peterson, Senior Counsel, at (916) 322-1570.

Special Note to Industrial Banks

Among its other provisions, the new law allows an industrial bank to delay for up to four years the effectiveness of the distribution restrictions found in Financial Code Sections 642, 643 and 644. Within 30 days of January 1, 2001, any industrial bank which decides to delay the applicability of the Financial Code distribution restrictions must file with the Commissioner a notice of election. Within 15 days of receipt of the notice, the Commissioner shall acknowledge in writing that the notice has been received and filed. The acknowledgement of the filing by the Commissioner will act to delay the applicability of Sections 642, 643, and 644. If an industrial bank has chosen to delay the effectiveness of the Financial Code distribution restrictions, its ability to declare distributions during the interim period will be governed by the distribution restrictions found in Section 500 of the Corporations Code. On January 1, 2005, all industrial banks will be included within the Financial Code distribution restrictions.

This change requires an amendment to the purpose clause of the Articles of Incorporation of every industrial bank. The current purpose clause contained in the articles of each industrial loan company was deemed, as of September 30, 2000, to conform with Financial Code Section 600. However, each industrial bank still has to effect an amendment to its articles formally changing the purpose clause to conform with Section 600, on or before December 29, 2000. The correct clause can be found at Financial Code Section 600(c).

DFI to Sponsor Industrial Bank Conference

The Department of Financial Institutions (DFI) has scheduled a conference with the industrial bank industry to discuss Chapter 1015, Statutes of 2000 (SB 2148 Polanco) which went into effect on September 30, 2000. This new law enacted provisions of the Financial Code which remove much of the detailed regulation of industrial banks and it subjects them to an overall regulatory framework of "safety and soundness" like commercial banks. The conference will be held on Tuesday, November 14, 2000, from 2:00 PM until 4:30 PM, in the auditorium on the ground floor of the Ronald Reagan State Office Building, 300 South Spring Street, Los Angeles, California.

The industrial bank industry, including members of industrial bank senior management teams, boards of directors, outside consultants, attorneys, accountants and other interested persons are invited to attend this conference. Please RSVP to Craig Carlson at (858) 642-4241 by no later than November 9th and indicate the number of persons planning to attend the conference from your institution.

Should you have any questions in advance of the meeting, please contact either Assistant Deputy Commissioner Craig Carlson at (858) 642-4241 or Doug Kirkpatrick at (213) 897-2223. I look forward to seeing you on November 14th.

Monthly Activity Report

Commercial Bank Activity

New Bank

Proposed Location: 199 South Robles Avenue, Pasadena, Los Angeles County
Correspondent: Howard A. Shields
199 South Robles Avenue, Suite 350
Pasadena, CA 91101
Phone: (626) 395-7000
Filed: 9/29/00

Conversion to State-Chartered Bank

Pan American Bank, FSB, San Mateo, under the name United PanAm Bank
Filed: 10/5/00


Commercial Bank of San Francisco, San Francisco, with and into Redwood Bank, San Francisco
Approved: 10/26/00

First Bank & Trust, Newport Beach, with and into Redwood Bank, San Francisco
Approved: 10/3/00

First Bank of California, Sacramento, with and into Redwood Bank, San Francisco
Approved: 10/3/00

First Bank Texas National Association, Houston, Texas, with and into Redwood Bank, San Francisco
Approved: 10/3/00

Kermit State Bank, Kermit, Texas, with and into Cathay Bank, Los Angeles
Filed: 10/3/00

North County Bank, Escondido, with and into Wells Fargo Bank, N.A. San Francisco
Effected: 8/18/00

Acquisition of Branch Office

Scott Valley Bank, Yreka, to acquire the Weaverville Branch of Six Rivers National Bank, Eureka
Filed: 9/28/00

Sale of Branch Office

Pacific State Bank, Stockton, to sell the Columbia Branch to Western Sierra National Bank
Effected: 10/13/00

Foreign Bank Activity

Foreign (Other Nation) Bank – To Establish Office

Banco do Brasil, S.A.
811 Wilshire Boulevard, Los Angeles
(Representative Office)
Opened: 8/1/00

Foreign (Other Nation) Bank – To Discontinue Office

Banco do Brasil, S.A.
811 Wilshire Boulevard, Los Angeles
(Depositary Agency)
Effected: 7/30/00

The Sakura Bank, Ltd.
515 So. Figueroa Street, Los Angeles
(Nondepositary Agency)
Filed: 8/21/00
Approved: 10/18/00

Foreign (Other Nation) Bank – Voluntary Surrender of License

The Sumitomo Trust & Banking Co., Ltd., 300 South Grand Avenue, Los Angeles
(Representative Office)
Effected: 10/20/00

Industrial Loan Company Activity

New Premium Finance Companies

Nova Financial, Inc.,
2100 East Katella Avenue, Suite 220, Anaheim
Opened: 10/19/00

Thomco Finance, Inc., 2501 Cherry Avenue, Suite 300, Long Beach
Filed: 3/27/00
Approved: 9/8/00

Voluntary Surrender of License

Freeway Budget Plan, Inc., 1036 West Taft Avenue, Orange
Effected: 10/23/00

Credit Union Activity

Conversion to State Charter

Alliance Federal Credit Union to convert to state charter under the name Alliance Credit Union, San Jose
Effected: 7/1/00

Medical Centers Federal Credit Union, Los Angeles
Filed: 10/12/00


Associates Mechanical Federal Credit Union, San Diego, with and into Point Loma Credit Union, San Diego
Approved: 9/1/00

Central Coast Credit Union, San Luis Obispo, with and into County City Employees Credit Union, San Luis Obispo
Approved: 9/1/00

Las Flores Credit Union, San Luis Obispo, with and into County City Employees Credit Union, San Luis Obispo
Approved: 9/1/00

Lodi Employees Credit Union, Lodi, with and into Eagle Credit Union, Stockton
Filed: 9/14/00
Approved: 10/10/00

Transmitters of Money Abroad Activity

New Transmitters

El Camino Transferencias, Inc.
Filed: 9/22/00

Meest Corporation Inc.
Filed: 9/7/00

Motran Services, Inc.
2325 E. 4th Street, Los Angeles, CA 90033
Contact Person: Esteban De La Paz
Phone: (323) 264-0170
Opened: 9/25/00


Commissioner of Financial Institutions

Bulletin for month ended
October, 2000, issued pursuant
to Financial Code, Section 258

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