Montana Administrative Register Notice 2-59-508 No. 12   06/26/2014    
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In the matter of the amendment of ARM 2.59.104 pertaining to semiannual assessment for banks








TO: All Concerned Persons


1. On July 31, 2014, the Department of Administration proposes to amend the above-stated rule.


2. The Department of Administration will make reasonable accommodations for persons with disabilities who wish to participate in this rulemaking process or need an alternative accessible format of this notice. If you require an accommodation, contact the Department of Administration no later than 5:00 p.m. on July 18, 2014, to advise us of the nature of the accommodation that you need. Please contact Wayne Johnston, Division of Banking and Financial Institutions, P.O. Box 200546, Helena, Montana 59620-0546; telephone (406) 841-2918; TDD (406) 444-1421; facsimile (406) 841-2930; or e-mail to banking@mt.gov.


3. The rule as proposed to be amended provides as follows, new matter underlined, deleted matter interlined:


2.59.104 SEMIANNUAL ASSESSMENT  (1)  Based upon the following schedule, and upon calculation of the semiannual value for the respective bank, the value must be multiplied by the factor of 1.50 to determine the dollar fee assessment, rounded to the next highest dollar, due the Division of Banking and Financial Institutions for the semiannual period.


Total assets



Plus rate/




0-1 0 .00085 0
1-10 850 .000105 1
10-50 1,795 .000085 10
50-100 5,195 .00005 50
over 100 7,695 .00003



(2) For the period April 26, 2013 [effective date of this amendment] through September 30, 2013 December 31, 2014, the assessment fee must be multiplied by a factor of .50. This section will sunset October 1, 2013 January 26, 2015.


AUTH: 32-1-213, 32-1-218, MCA

IMP: 32-1-213, 32-1-218, MCA


STATEMENT OF REASONABLE NECESSITY:  The banking industry in Montana is currently in a state of flux and there is no end in sight. Due to regulatory pressures and economic factors, the Montana Division of Banking and Financial Institutions (division) has seen a series of mergers and consolidations involving banks in this state and outside of this state over the last 12 months. In the last year, the division has seen three mergers that resulted in gains to the assessments for Montana, and three mergers that resulted in losses to the assessments for Montana.

At this time, one conversion and one merger are pending. They will result in gains to the assessments.

While the division tries to keep its banking assessments in proportion to the costs it spends on supervising Montana banks, it is particularly difficult to do so in the current environment when mergers and conversions throw the assessments into flux.

At this point in time, the division anticipates a net gain in its revenue of $74,564 semiannually based on the mergers and conversions that either have occurred to date or will occur in the near future.

It is impossible for the division to predict with any certainty which institutions will or will not merge or convert in the future. As a result, the division has chosen to reduce its semiannual assessment for the December assessment by one-half. The division estimates that on an annual basis, based on current costs and estimates of assessments, reducing the assessment by one-half will bring the amount of revenue closer to the cost of supervision. This will reduce the cost to the 55 institutions and lower the amount the division receives in its December assessment.

The division will propose a permanent downward revision in the bank assessments after it becomes reasonably certain that the number and composition of state-chartered banks have reached a relatively stable number. However, at this time, the division has no idea when that may be.

The intent of this amendment is to reduce the assessments that the division will receive in December 2014 from approximately $1,500,000 to approximately $750,000. Because this rule revision is intended to be temporary, the division has chosen to have it sunset on January 26, 2015, which will make the amendment effective only for the December 2014 assessment, not for the June 2015 assessment or any assessment thereafter.


4. Concerned persons may present their data, views, or arguments concerning the proposed action to Kelly O'Sullivan, Legal Counsel, Division of Banking and Financial Institutions, P.O. Box 200546, Helena, Montana 59620-0546; faxed to the office at (406) 841-2930; or e-mailed to banking@mt.gov; and must be received no later than 5:00 p.m., July 25, 2014.


5. If persons who are directly affected by the proposed action wish to express their data, views, or arguments orally or in writing at a public hearing, they must make written request for a hearing and submit this request along with any written comments to the person listed in 4 above no later than 5:00 p.m., July 25, 2014.


6. If the Division of Banking and Financial Institutions receives requests for a public hearing on the proposed action from either 10% or 25, whichever is less, of the persons directly affected by the proposed action; from the appropriate administrative rule review committee of the Legislature; from a governmental subdivision or agency; or from an association having not less than 25 members who will be directly affected, a hearing will be held at a later date. Notice of the hearing will be published in the Montana Administrative Register. Ten percent of those directly affected has been determined to be six persons based on the 55 existing state-chartered banks.


7. An electronic copy of this proposal notice is available through the department's web site at http://doa.mt.gov/administrativerules.mcpx. The department strives to make the electronic copy of the notice conform to the official version of the notice, as printed in the Montana Administrative Register, but advises all concerned persons that if a discrepancy exists between the official printed text of the notice and the electronic version of the notice, only the official printed text will be considered. In addition, although the department works to keep its web site accessible at all times, concerned persons should be aware that the web site may be unavailable during some periods, due to system maintenance or technical problems.


8. The Division of Banking and Financial Institutions maintains a list of interested persons who wish to receive notices of rulemaking actions proposed by this division. Persons who wish to have their name added to the mailing list shall make a written request that includes the name and mailing address and e-mail address of the person to receive notices and specifies that the person wishes to receive notices regarding division rulemaking actions. Notices will be sent by e-mail unless a mailing preference is noted in the request. Such written requests may be mailed or delivered to Wayne Johnston, Division of Banking and Financial Institutions, 301 S. Park, Ste. 316, P.O. Box 200546, Helena, Montana 59620-0546; faxed to the office at (406) 841-2930; e-mailed to banking@mt.gov; or may be made by completing a request form at any rules hearing held by the department.


9. The bill sponsor contact requirements of 2-4-302, MCA, do not apply.


10. The department has determined that under 2-4-111, MCA, the proposed rule amendment will not significantly and directly affect small businesses.




By:   /s/ Sheila Hogan                                        By:   /s/ Michael P. Manion              

Sheila Hogan, Director                                     Michael P. Manion, Rule Reviewer

Department of Administration                            Department of Administration



Certified to the Secretary of State June 16, 2014.


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