OCC 2003-8
OCC BULLETIN	

Subject:      Rules, Policies, and Procedures for Corporate 
              Activities; Bank Activities and Operations; and Real 
              Estate Lending and Appraisals
	
Description:  Notice of Proposed Rulemaking

Date:         February 13, 2003

TO:  Chief Executive Officers of All National Banks, Federal 
     Branches and Agencies, Department and Division Heads, and All 
     Examining Personnel

The Office of the Comptroller of the Currency published the attached 
notice of proposed rulemaking in the Federal Register on February 7, 
2003 (NPRM).  The NPRM amends 12 CFR parts 3, 5, 6, 7, 9, 28, and 
34 of its regulations.  Comments on the NPRM will be due by April 8.

Proposed revisions to parts 5 and 7 would implement several sections 
of the American Homeownership and Economic Opportunity Act of 2000 
(AHEOA), which enables national banks to undertake certain corporate 
organizational changes more efficiently than under previous law, and 
also provides for more modern corporate governance mechanisms for 
national banks.  The sections of AHEOA implemented by the proposal 
are:

•  Section 1204, which permits national banks to reorganize directly 
   to become a subsidiary of a holding company;
•  Section 1205, which increases the maximum term of service for 
   national bank directors, permits a national bank to adopt bylaws 
   allowing for staggered terms for directors in accordance with OCC 
   regulations, and permits national banks to apply for permission 
   to have more than 25 directors; and
•  Section 1206, which permits national banks to merge with one or 
   more of their nonbank affiliates, subject to OCC approval.

The proposal also provides clarification of the OCC’s current 
regulation concerning the scope of the agency’s “visitorial powers” 
over national banks.  “Visitorial powers” refers to the authority 
to examine, supervise, regulate, require information from, and take 
enforcement action against a bank.  Addressing questions that have 
arisen concerning the scope of this exclusive authority, the rule 
provides that the OCC’s visitorial powers over national banks and 
their operating subsidiaries are exclusive with respect to 
activities that are expressly authorized or recognized as 
permissible for national banks under federal law, including the 
OCC’s regulations and interpretations.  The proposed rule also 
provides that while courts may exercise visitorial powers by issuing 
orders or writs compelling the production of information or 
witnesses, this exception may not be used by the states as a means 
of inspecting, regulating, or supervising national bank activities.

The proposed regulations also include amendments to several other 
OCC regulations.  The proposal revises several provisions of the 
corporate procedures and the bank activities regulations to make 
clarifying changes or updates based on recent developments in the 
law.  It amends the fiduciary activities rules to modify the 
required timing of valuation for certain collective investment 
funds.  Finally, it revises a provision of the real estate lending 
rules, which address the OCC’s authority with respect to real estate 
lending for national banks, to conform with a change that was made 
to the underlying statute.

For further information, contact Andra Shuster, counsel, Legislative 
and Regulatory Activities Division at (202) 874-5090.



						
Julie L. Williams
First Senior Deputy Comptroller and Chief Counsel




Attachment—68 FR 6363
[ http://www.occ.treas.gov/fr/fedregister/68fr6363.pdf ]