The Kansas Office of State Bank Commissioner is the regulatory agency for Kansas state-chartered banks and trust companies. We try to reduce regulatory burdens on banks and trust companies when appropriate. I’m pleased to announce we have issued a new regulation with the approval of the State Bank Commissioner, David L. Herndon. The new regulation removes a bureaucratic burden on state banks and trust companies to quickly offload other assets and fixed assets on their books and will benefit Kansans as a whole. K.A.R. 17-11-24 was published on February 23, 2023, Volume 42 in Issue 8 of the 2023 Kansas Register. This amendment is effective March 10, 2023, and makes the following changes:
- Creates rules where a bank or trust company may sell tangible personal property to executive officers, employees, directors, and related interests without receiving the Bank Commissioner’s preapproval under K.S.A. 9-1112.
- Bank or trust companies that sell tangible personal property to executive officers, employees, directors, and related interests are required to maintain documentation of the sale of the property to be reviewed at the next examination.
K.S.A. 9-1112(b) requires a bank or trust company to receive commissioner preapproval to sell assets to an executive officer, employee, director, or related interest. K.A.R. 17-11-24 allows state-chartered banks and trust companies to internally sell tangible personal property without commissioner preapproval. Note, all other sales to an executive officer, employee, director, or a related interest would need commissioner approval under K.S.A. 9-1112, including real estate. Additionally, federal law requirements which prohibit inappropriate favoritism continue to apply if the sale of personal property is financed by the bank.
