Section 5-13B-115

Seizure of foreign bank's property and business; liquidation.

(a) If the superintendent finds that any of the factors set forth in Section 5-13B-113 are true with respect to any foreign bank which is licensed to establish and maintain an Alabama state branch or Alabama state agency and that it is necessary for the protection of the interests of the creditors of such foreign bank's business in this state or for the protection of the public interest that he or she take immediate possession of the property and business of the foreign bank, the superintendent may by order forthwith take possession of the property and business of the foreign bank in this state and retain possession until the foreign bank resumes business in this state or is finally liquidated. The foreign bank may, with the consent of the superintendent, resume business in this state upon such conditions as the superintendent may prescribe by regulation or order.

(b) At any time within 10 days after the superintendent has taken possession of the property and business of a foreign bank pursuant to subsection (a), such foreign bank may apply to the circuit court of the county in which the primary office of the foreign bank is located in this state for an order requiring the superintendent to show cause why he or she should not be enjoined from continuing such possession. The court may, upon good cause being shown, direct the superintendent to refrain from further proceedings and to surrender such possession. The judgment of the court having jurisdiction over any proceedings under this subsection may be appealed by the superintendent or by the foreign bank in the manner provided by law for appeals from a judgment of the circuit court. Where the superintendent appeals the judgment of the circuit court, such appeal shall operate as a stay of the judgment and a reinstatement of the superintendent's possession. The superintendent shall not be required to post any bond.

(c) Whenever the superintendent takes possession of the property and business of a foreign bank pursuant to subsection (a), he or she shall conserve or liquidate the property and business of such foreign bank pursuant to the laws of this state as if the foreign bank were an Alabama state bank, with absolute preference and priority given to the creditors of such foreign bank arising out of transactions with, and recorded on the books of, its Alabama state branch or Alabama state agency over the creditors of such foreign bank's offices located outside this state.

(d) When the superintendent has completed the liquidation of the property and business of a foreign bank, the superintendent shall transfer any remaining assets to such foreign bank in accordance with such orders as the court may issue. However, in case the foreign bank has an office in another state of the United States which is in liquidation and the assets of such office appear to be insufficient to pay in full the creditors of that office, the court shall order the superintendent to transfer to the liquidator of that office such amount of any such remaining assets as appears to be necessary to cover such insufficiency; if there are two or more such offices and the amount of remaining assets is less than the aggregate amount of insufficiencies with respect to the offices, the court shall order the superintendent to distribute the remaining assets among the liquidators of such offices in such manner as the court finds equitable.

(Acts 1995, No. 95-115, p. 134, §63.)