HD20 - Report of the Joint Subcommittee Studying the Revision of the Savings and Loan Laws and the Interest Rate Laws of the Commonwealth and the Issue of Interstate Banking
Executive Summary: INTRODUCTION The joint subcommittee studying the revision of the savings and loan laws and interest rate laws of the Commonwealth and the issue of interstate banking was established pursuant to House Joint Resolution No. 30 of the 1984 General Assembly. Delegate George H. Heilig, Jr., of Norfolk was elected chairman of the Subcommittee. Other members of the House of Delegates appointed to serve were: William T. Wilson of Covington, Alson H. Smith, Jr. of Winchester, Franklin P. Hall of Richmond and Vincent F. Callahan, Jr., of McLean. Senator William F. Parkerson, Jr. of Henrico was elected Vice-Chairman of the Subcommittee. Other Senate members appointed to serve were: Edward E. Willey of Richmond, Peter K. Babalas of Norfolk, and Richard J. Holland of Windsor. Two citizen members were appointed to serve on the Subcommittee: John B. Bernhardt, Vice-Chairman of the Board of Sovran Bank, and Edwin B. Brooks, Jr., President of Virginia Federal Savings and Loan Association. C. William Crammé, III, Senior Attorney, and Terry Mapp, Research Associate of the Virginia Division of Legislative Services, served as legal and research staff for the Subcommittee. Ann Howard and Barbara Hanback of the House Clerk's Office provided administrative and clerical staff assistance for the Subcommittee. WORK OF THE SUBCOMMITTEE The full Joint Subcommittee held meetings on June 25, September 18 and December 18. During its meetings, the Subcommittee heard a great deal of oral testimony. The staff and interested parties offered the study group voluminous amounts of written materials during and between meetings. Prior to the Subcommittee's first meeting, its staff furnished each member with a copy of a synopsis of the various states' on the issue of interstate banking and copies of the enacted or proposed legislation of those states listed in the synopsis. Also, the members received many articles which discussed and analyzed the issue of interstate banking. The Subcommittee's first meeting, which was held on June 25, was mainly an organizational meeting in which the study group elected its chairman and vice-chairman and adopted a timetable for the study. During that meeting, because Mr. Heilig had asked representatives of the various industries to brief the Subcommittee on the three issues which the Subcommittee was charged with reviewing, the Subcommittee heard testimony from the Virginia League of Savings Institutions, the Virginia Bankers Association, the Bureau of Financial Institutions, the Virginia Credit Union League, and the Independent Bankers Association of Virginia. The Subcommittee heard brief testimony from the representatives of the groups which centered on their thoughts with regard to the three areas of the study. In discussing the work schedule and future meetings of the Subcommittee, the Subcommittee agreed that draft legislation should be developed in the three areas with which the subcommittee was charged to study. They decided that once this legislation had been prepared, the Subcommittee could hold another meeting in order to elicit comments on that legislation. During the month of July, August, and early September, Counsel for the Virginia League of Savings Institutions prepared draft legislation to revise the savings and loan laws. Also, during that time period, the Subcommittee's staff prepared legislation to revise the interest rate laws and to effect interstate banking in Virginia. At the September 18 meeting of the full Joint Subcommittee, the Subcommittee received testimony on the savings and loan draft, the interest rate draft, and the interstate banking draft. The Subcommittee decided to establish three subcommittees to hold meetings on the particular draft legislation. It was decided that a Savings and Loan Subcommittee, an Interstate Subcommittee, and an Interest Rate Subcommittee be established in order to hold hearings for a line-by-line review of the particular draft legislation. The full Joint Subcommittee decided that the establishing of the three subcommittees would provide the best method for an expeditious handling of the subjects with which the Subcommittee was charged to study. The membership of those Subcommittees were as follows: Interest Rate Subcommittee: Babalas Holland Callahan Savings and Loan Subcommittee: Heilig Willey Hall Brooks Interstate Subcommittee: Parkerson Smith Wilson Bernhardt Brooks During the same meeting, the Subcommittee heard testimony from Counsel that highlighted the savings and loan draft. The Virginia Bankers Association presented the interstate banking draft and written testimony on the interstate banking issue. Also at this meeting, the Subcommittee considered the possibility of the banks, savings and loan associations and the credit unions having their own bill dealing with the interstate issue since the banks were leaning toward a regional approach, and the savings and loan associations and credit unions were leaning toward a national approach. The Subcommittee decided the three subcommittees established should meet as soon as possible and as many times as necessary in order that the draft legislation may be discussed and fine-tuned, and in order that a report of the subcommittees' work may be presented at the next meeting of the full Joint Subcommittee. The Subcommittee decided that the subcommittees' reports should be received by the full Joint Subcommittee in time that the full Joint Subcommittee may make its recommendations at a meeting in December. All three subcommittees met twice. The Savings and Loan Subcommittee met on October 22 and December 7; the Interstate Banking Subcommittee met on October 16 and December 10; and the Interest Rate Subcommittee met on October 16 and December 7. At all of the meetings of the subcommittees, draft legislation was discussed section by section and many changes were recommended to the drafts. At all three of the subcommittees' meetings, the representatives of the Virginia Bankers Association, the Virginia League of Savings Institutions, the Virginia Independent Bankers' Association, and the Bureau of Financial Institutions gave testimony concerning the particular draft under study. During the meetings of the Interest Rate Subcommittee, the subcommittee also heard testimony from representatives of the Virginia Consumer Finance Association, who took a strong interest in this particular portion of the study. During the meetings of the Interstate Banking Subcommittee, the subcommittee heard testimony from representatives from the First National Bank of Maryland and its Counsel, representatives from Citicorp Bank in New York, and the Virginia Credit Union League on Senate Bill No. 148, which was carried over by the 1984 Session of the General Assembly. Other participants in the meetings of the Savings and Loan Subcommittee were the Virginia Realtors Association and the Virginia Home Builders Association. At its final meeting on December 18, the full Joint Subcommittee received the reports of the three subcommittees. Senator Babalas, Chairman of the Interest Rate Subcommittee, briefly stated the work of his subcommittee and asked that that portion of the study dealing with interest rates be continued for another year. Senator Parkerson, Chairman of the Interstate Banking Subcommittee, asked the staff of the full subcommittee, Bill Crammé to present the interstate banking bill and report to the full Joint Subcommittee. During the report of the Interstate Banking Subcommittee, the full Subcommittee heard testimony from the First National Bank of Maryland and its Counsel, Piper and Marbury of Maryland, the Bureau of Financial Institutions, and the Virginia Bankers Association. Senator Parkerson called on the Virginia Credit Union League to present Senate Bill No. 148 of the 1984 General Assembly Session that address the interstate issue with regards to credit unions. Delegate Heilig, Chairman of the Savings and Loan Subcommittee, called on the Virginia League of Savings Institutions and its Counsel, the law firm of Thomas and Fiske, to present the savings and loan draft to the Subcommittee. The full Subcommittee also heard from the Virginia Bankers Association, the Virginia Independent Bankers Association, and the Bureau of Financial Institutions during the report of the Savings and Loan Subcommittee. Having heard testimony from all of the interested parties, the Subcommittee thoroughly discussed and carefully considered which recommendations to make to the 1985 General Assembly. Some of the recommendations were not made by a unanimous vote of the members of the full Joint Subcommittee and some were made with conditions that further testimony should be heard by the General Assembly on various items within particular drafts. |
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