§ 108.304. Issuance of Subordinated Debt Securities.
10 CA ADC § 108.304Barclays Official California Code of Regulations
10 CCR § 108.304
§ 108.304. Issuance of Subordinated Debt Securities.
(a) General. No association shall issue subordinated debt securities pursuant to this section or amend the terms of such securities unless it has obtained written approval of the commissioner. Approval of the issue under this section is required only in order to qualify it under Section 101.100(h) as part of statutory net worth to the extent provided in that section, and may be obtained either before or after the securities are issued, but no approval shall be granted unless issuance of the securities and the form and manner of filing of the application are in accordance with the provisions of this section.
(D) actual and anticipated income from operations, after distribution of earnings to the holders of savings accounts, payment of dividends on equity securities and payment of interest on borrowings but before income taxes, is not demonstrably sufficient for payment of interest and amortization of debt, discount, and related expenses of the proposed issue.
(c) Application form; supporting information. An application for approval of the issuance of subordinated debt securities by an association pursuant to this section shall be in letter form setting forth all of the terms and provisions relating to the proposed issue and showing that all of the requirements of this section have been or will be met, and numbered in accordance with the numbering of this section.
(2) Limitation as to term. No subordinated debt security issued by an association pursuant to this section shall have an original period to maturity of less than 7 years. During the first six years that such a security is outstanding, the total of all required sinking fund payments, other required prepayments and required reserve allocations with respect to the portion of such six years as have elapsed shall at no time exceed the original principal amount thereof multiplied by a fraction the numerator of which is the number of years which have elapsed since the issuance of the security and the denominator of which is the number of years covered by the original period to maturity.
(3) Limitations on sale to certain institutions. No association may sell any subordinated debt securities issued pursuant to this section to a Federal Home Loan Bank or, except with prior written approval of the commissioner in a supervisory situation, to the Federal Savings and Loan Insurance Corporation.
(g) Limitation on offering period. Following the date of the approval of the application by the commissioner the association shall have an offering period of not more than one year in which to complete the sale of the subordinated debt securities issued pursuant to this section. The commissioner may extend such offering period if a written request showing good cause for such extension is filed not later than 30 days before the expiration of such offering period or any previous extension thereof.
(h) Reports. Within 30 days after completion of the sale of the subordinated debt securities issued pursuant to prior approval under this section, the association shall transmit a written report to the commissioner stating the number of purchasers, the total dollar amount of securities sold, and the amount of net proceeds received by the association.
Credits
Note: Authority cited: Section 5255, Financial Code. Reference: Section 6702, Financial Code.
History
1. Change without regulatory effect renumbering former Section 231.4 to Section 108.304 (Register 87, No. 14). For prior history, see Register 83, No. 16.
This database is current through 5/10/24 Register 2024, No. 19.
Cal. Admin. Code tit. 10, § 108.304, 10 CA ADC § 108.304
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