CHAPTER 665a

DEPOSITS

Table of Contents

Sec. 36a-290. (Formerly Sec. 36-3). Joint deposit and share accounts.

Sec. 36a-291. (Formerly Sec. 36-113). Pledge of savings, share and time accounts in single or joint ownership.

Sec. 36a-292. (Formerly Sec. 36-3a). Liability of survivor receiving payment on joint deposit account or share account.

Sec. 36a-293. (Formerly Sec. 36-5). Adverse claim to deposit account or share account.

Sec. 36a-294. (Formerly Sec. 36-114). Loss, theft or destruction of passbooks, certificates or instruments.

Sec. 36a-295. (Formerly Sec. 36-76). Rendering of statement and delivery of passbook; accuracy and completeness presumed after seven years.

Sec. 36a-296. (Formerly Sec. 36-110). Deposits or share accounts in trust.

Sec. 36a-297. (Formerly Sec. 36-111). Deposits or share accounts of minors.

Sec. 36a-298. (Formerly Sec. 36-106). Notice of withdrawals.

Sec. 36a-299. (Formerly Sec. 36-9i). Permitted and prohibited transfers by negotiable withdrawal order.

Sec. 36a-300. (Formerly Sec. 36-108). School savings deposits and time deposits.

Sec. 36a-301. (Formerly Sec. 36-9q). Tax and loan accounts and note accounts.

Sec. 36a-302. (Formerly Sec. 36-9v). Applicability of federal Expedited Funds Availability Act to banks and credit unions.

Sec. 36a-303. (Formerly Sec. 36-9o). Charge for overdraft, when prohibited.

Sec. 36a-304. (Formerly Sec. 36-9bb). Cashing of state checks. Fee prohibited. Liability for loss from wrongful payment.

Sec. 36a-305. (Formerly Sec. 36-9cc). Regulations re cashing state checks.

Sec. 36a-306. Connecticut banks and Connecticut credit unions to accept identification cards, when.

Sec. 36a-307. (Formerly Sec. 36-9dd). Interest on savings deposit accounts.

Secs. 36a-308 to 36a-314. Reserved

Sec. 36a-315. (Formerly Sec. 36-27a). Short title: Deposit Account Contract Act.

Sec. 36a-316. (Formerly Sec. 36-27b). Definitions.

Sec. 36a-317. (Formerly Sec. 36-27c). Prohibited acts of financial institutions.

Sec. 36a-317a. Charges for stop payment orders.

Sec. 36a-317b. Check cashing. Adequate identification.

Sec. 36a-318. (Formerly Sec. 36-27d). Copy of deposit account contract and schedule of charges and interest to be furnished to depositors. Exceptions. Notice requirements. Notice re imposition of dormancy fees on inactive deposit accounts.

Sec. 36a-319. (Formerly Sec. 36-27e). Deposit account disclosures. List of charges.

Sec. 36a-320. (Formerly Sec. 36-27f). Changes in deposit account charges. Notice.

Sec. 36a-321. (Formerly Sec. 36-27g). Changes in computation of interest or interest rate. Notice.

Sec. 36a-322. (Formerly Sec. 36-27h). Enforcement powers of commissioner.

Sec. 36a-323. (Formerly Sec. 36-27i). Exceptions. Waivers.

Secs. 36a-324 to 36a-329. Reserved

Sec. 36a-330. (Formerly Sec. 36-382). Definitions.

Sec. 36a-331. (Formerly Sec. 36-383). Protection of public deposits.

Sec. 36a-332. (Formerly Sec. 36-385). Powers of commissioner.

Sec. 36a-333. (Formerly Sec. 36-386). Collateral requirements.

Sec. 36a-334. (Formerly Sec. 36-387). Procedure upon loss.

Sec. 36a-335. (Formerly Sec. 36-388). Subrogation of commissioner to depositor’s rights.

Sec. 36a-336. (Formerly Sec. 36-389). Public deposits in qualified public depository or out-of-state bank.

Sec. 36a-337. (Formerly Sec. 36-390). Securing of public deposits.

Sec. 36a-338. (Formerly Sec. 36-391). Report of public depository.

Secs. 36a-339 to 36a-349. Reserved


PART I

DEPOSITS AND CHECKS

Sec. 36a-290. (Formerly Sec. 36-3). Joint deposit and share accounts. (a) When a deposit account has been established at any bank, or a share account has been established at any Connecticut credit union or federal credit union, in the names of two or more natural persons and under such terms as to be paid to any one of them, or to the survivor or survivors of them, such account is deemed a joint account, and any part or all of the balance of such account, including any and all subsequent deposits or additions made thereto, may be paid to any of such persons during the lifetime of all of them or to the survivor or any of the survivors of such persons after the death of one or more of them. Any such payment constitutes a valid and sufficient release and discharge of such bank, Connecticut credit union or federal credit union, or its successor, as to all payments so made.

(b) The establishment of a deposit account or share account which is a joint account under subsection (a) of this section is, in the absence of fraud or undue influence, or other clear and convincing evidence to the contrary, prima facie evidence of the intention of all of the named owners thereof to vest title to such account, including all subsequent deposits and additions made thereto, in such survivor or survivors, in any action or proceeding between any two or more of the depositors, respecting the ownership of such account or its proceeds.

(c) This section shall not apply to any deposit account or share account where any owner died before October 1, 1971, nor shall it apply to any action pending on that date.

(1953, S. 2779d; 1961, P.A. 405; 1971, P.A. 417; P.A. 78-121, S. 10, 113; P.A. 88-65, S. 7; P.A. 92-12, S. 2; P.A. 94-122, S. 131, 340.)

History: 1961 act clarified application of statute to accounts issued to more than two persons; 1971 act added “or other clear and convincing evidence to the contrary” and substituted “prima facie” for “conclusive” evidence in Subsec. (1) and changed applicability in Subsec. (2) to exclude “any” owner rather than “either” owner who died before October 1, 1971, rather than October 1, 1953; P.A. 78-121 deleted references to deposits in building associations and private banks in Subsec. (1); P.A. 88-65 deleted a reference to industrial banks in Subsec. (1); P.A. 92-12 redesignated Subsecs. and made technical changes; P.A. 94-122 made technical changes, divided former Subsec. (a) into Subsecs. (a) and (b), and relettered former Subsec. (b) as Subsec. (c), effective January 1, 1995; Sec. 36-3 transferred to Sec. 36a-290 in 1995.

Annotations to former section 36-3:

Former statute cited. 139 C. 350. Cited. 142 C. 257. Cited. 183 C. 96. Cited. 226 C. 51.

Intent of the legislature is to give to the survivors an unrebuttable presumption of ownership, but the determination of the respective rights of the parties inter vivos is left to the common law. 154 C. 456. Cited. 172 C. 292. Cited. 176 C. 657; 177 C. 53. Cited. 195 C. 82. Cited. 232 C. 172.

Cited. 2 CA 430. A legislative rule of evidence which has the effect of shifting a burden of proof is not an unconstitutional invasion of the legislative into the judicial sphere: The statute affects the introduction of evidence, it does not impinge on independence of the judicial branch. Id., 622. Cited. 7 CA 735. Cited. 13 CA 662.

Cited. 43 CS 360.

Annotations to present section:

Cited. 240 C. 343.

Testimony that a joint account was created to help pay decedent’s expenses is not clear and convincing evidence sufficient to overcome statutory presumption that it was intended to be a gift to the survivor; such payment of expenses is not inconsistent with an intent to vest title in the surviving account holder. 60 CA 665.

Subsec. (a):

Serves only as a bank protection provision and does not determine ownership interests in funds in joint account. 79 CA 112.

Subsec. (b):

Where one owner of joint account dies, two survivors have ownership interests in account funds and trial court’s finding that one owner’s withdrawal of all funds was a conversion of funds was not clearly erroneous. 79 CA 112.

Sec. 36a-291. (Formerly Sec. 36-113). Pledge of savings, share and time accounts in single or joint ownership. Unless the applicable deposit contract or share contract provides that the account is nontransferable, and except to the extent that such deposit contract or share contract otherwise limits such right, the interest of any named owner in any savings account or share account established or maintained at any Connecticut bank or Connecticut credit union, except a savings or share account subject to negotiable orders of withdrawal, or in any time account established or maintained at such bank or credit union, without regard to whether any such account is held in the names of one or more persons, may be pledged by such named owner, without the consent of any other named owner thereof by delivery to the pledgee of (1) the passbook, if any, evidencing such account, and (2) an order to the Connecticut bank or Connecticut credit union to transfer such pledged account to the pledgee; but no such pledge shall be effective against any person other than the named owners, their executors or administrators, or their receivers or custodians, unless an actual transfer of such account to the pledgee has been made upon the books of such bank or credit union, or a copy of the order for such transfer has been filed with the bank or credit union. Any pledgee which makes a loan based on the pledge of a savings account, time account or share account as provided in this section shall have a lien against such account until all sums due under the loan have been repaid. The Connecticut bank or Connecticut credit union with which such savings account, time account or share account is established or maintained may be a pledgee under this section. This section does not apply to a negotiable certificate of deposit subject to the terms of article 9 of title 42a.

(1949 Rev., S. 5833; 1955, S. 2686d; 1961, P.A. 222, S. 2; 1967, P.A. 461, S. 35; P.A. 79-433, S. 9; P.A. 94-122, S. 132, 340; P.A. 02-73, S. 28.)

History: 1961 act added “if any”; 1967 act deleted references to “savings departments” of state bank and trust companies; P.A. 79-433 added provision granting institutions which make loans on pledge of savings account a lien against any such savings accounts until loan is repaid; P.A. 94-122 rewrote the section to broaden the right to have a lien against a deposit which is pledged for a loan to include any pledgee, not just any bank, effective January 1, 1995; Sec. 36-113 transferred to Sec. 36a-291 in 1995; P.A. 02-73 added provisions making section applicable to Connecticut credit unions, share accounts and share contracts, and added provision re receivers or custodians.

Cited. 240 C. 343.

Sec. 36a-292. (Formerly Sec. 36-3a). Liability of survivor receiving payment on joint deposit account or share account. (a) Whenever all or any portion of the balance of any deposit account or share account which is a joint account under section 36a-290 has been paid, after the death of one account owner to any surviving account owner or owners, and if the deceased account owner has left no other estate of sufficient value for the payment of claims against the deceased account owner’s estate, such survivor or survivors or, if any such survivor is incapable, the legal representative of such incapable survivor, shall pay to the representative of such estate or, if there is no such representative, and subject to the terms of subsection (b) of this section, directly to the claimant, from such joint account or from its proceeds, any valid claims against the deceased account owner’s estate for such deceased account owner’s funeral expenses, for the expenses of settling such estate, for any debts owed for the last sickness of such deceased account owner, and for any debt due to this state for aid or care to the deceased account owner. The aggregate liability of the surviving account owner or owners, under this section, shall not exceed an amount equal to the balance of such joint account on the date of the deceased account owner’s death divided by the number of owners of such account immediately before the deceased account owner’s death.

(b) After pursuing all remedies available for payment from any estate left by the deceased account owner, any person to whom any of the claims, expenses or debts listed in subsection (a) of this section are owed shall have direct recourse to such survivor, survivors or legal representative of any such incapable survivor for such claim, expense or debt, but only to the extent of their liability under subsection (a) of this section, and shall thereafter have no further recourse against the deceased account owner’s estate for such claim, expense or debt.

(1959, P.A. 646; P.A. 82-197, S. 1, 2; P.A. 87-190; P.A. 94-122, S. 133, 340; P.A. 02-73, S. 29.)

History: P.A. 82-197 amended section to include debts due to the state for aid or care to the deceased depositor; P.A. 87-190 added provision that recourse of person to whom debts are owed shall be to survivor and not to the fiduciary of decedent’s estate; P.A. 94-122 changed “conservator” to “legal representative”, divided section into Subsecs. (a) and (b) and made technical changes, effective January 1, 1995; Sec. 36-3a transferred to Sec. 36a-292 in 1995; P.A. 02-73 amended Subsec. (a) by adding “or share account”.

Annotation to former section 36-3a:

Expenses of last illness and funeral are not deductible from the nonprobate portion of an estate, except as they may constitute liens thereon or debts which it is judicially established are chargeable thereto. Such liens or debts are not created by this section. 25 CS 250.

Sec. 36a-293. (Formerly Sec. 36-5). Adverse claim to deposit account or share account. Notice to any bank, Connecticut credit union or federal credit union of any adverse claim to all or any portion of the balance of a deposit account or share account held within this state and, according to such bank’s or credit union’s records, for the credit of any person, shall not be effectual to cause such bank or credit union to recognize such adverse claimant unless such adverse claimant also either (1) procures a restraining order, injunction or other appropriate process against such bank or credit union from a court of competent jurisdiction in a cause instituted by such person wherein each person for whose credit the deposit account or share account is held, or such person’s executor, administrator, receiver, custodian, legal representative or heir, is made a party and is served with summons, or (2) executes to such bank or credit union, in a form and with sureties acceptable to it, a bond indemnifying such bank or credit union from any and all liability, loss, damage, costs and expenses for and on account of the payment of such adverse claim or the dishonor of the check or other order of the person for whose credit the deposit account or share account, according to the records of such bank or credit union, is held; provided this section shall not apply in any instance where the person for whose credit the deposit account or share account is held, according to the records of such bank or credit union, is a fiduciary for such adverse claimant, and the facts constituting such relationship, and the facts showing reasonable cause of belief on the part of such claimant that such fiduciary is about to misappropriate all or any portion of the balance of such deposit account or share account, are made to appear by affidavit of such claimant. An adverse claimant means one who is not a named owner, joint owner or co-owner of the deposit account or share account according to the bank’s or credit union’s records. This section shall not apply to any writ of foreign attachment or any writ of execution applying to a deposit account or share account.

(1955, S. 2781d; P.A. 92-12, S. 3; P.A. 94-122, S. 134, 340; P.A. 02-73, S. 30.)

History: P.A. 92-12 made technical changes; P.A. 94-122 made technical changes, effective January 1, 1995; Sec. 36-5 transferred to Sec. 36a-293 in 1995; P.A. 02-73 added provisions making section applicable to credit unions and share accounts, added provision re receiver or custodian and made technical changes.

Sec. 36a-294. (Formerly Sec. 36-114). Loss, theft or destruction of passbooks, certificates or instruments. When any passbook, certificate or instrument, negotiable or nonnegotiable, transferable or nontransferable, issued by a Connecticut bank or Connecticut credit union in connection with a deposit account or share account has been lost, stolen or destroyed, all persons in whose names such account is held, or their respective legal representatives, may make written application to such bank or credit union for either the payment of the balance then due on such account or for the issuance of a duplicate passbook, certificate or instrument for such account. Such application shall be signed by each person in whose name such account is then held according to the records of the bank or credit union, and shall be in such form, together with such sureties and such reasonable representations, warranties, agreements and indemnifications as are acceptable to such bank or credit union. Upon receipt of such application and proof satisfactory to it of the identity of the person or persons making such application, such bank or credit union shall, at its option, either pay the balance then due on such account to such applicant or applicants or issue a duplicate passbook, certificate or instrument for such account and, upon such payment or issuance, all liability of such bank or credit union to any person making such application and based on the existence of the original passbook, certificate or instrument terminates.

(1949 Rev., S. 5834; 1959, P.A. 10; 1967, P.A. 461, S. 37; P.A. 76-174; P.A. 94-122, S. 135, 340; P.A. 02-73, S. 31.)

History: 1959 act added minimum balance provision, changed advertising requirement to two successive weeks and time allowed for presenting book to one month; 1967 act deleted reference to “savings departments” of state bank and trust companies; P.A. 76-174 made provisions generally applicable rather than applicable to passbooks with balance of $25 or more, required that application be signed by each person in whose name the book was issued and deleted requirement that notice of application be published at least once a week for two weeks in newspaper; P.A. 94-122 expanded the section to include “certificate or instrument, negotiable or nonnegotiable, transferable or nontransferable”, made the procedures apply to stolen passbooks, certificates or instruments, and allowed banks before issuing such instruments to require reasonable indemnifications, effective January 1, 1995; Sec. 36-114 transferred to Sec. 36a-294 in 1995; P.A. 02-73 added provisions making section applicable to Connecticut credit unions and share accounts.

Annotation to former section 36-114:

Waiver of provisions of section by bank. 87 C. 347.

Sec. 36a-295. (Formerly Sec. 36-76). Rendering of statement and delivery of passbook; accuracy and completeness presumed after seven years. Except as otherwise provided by applicable state or federal law, including title 42a, if a Connecticut bank or Connecticut credit union has rendered a statement or delivered a passbook to its depositor or share account holder reflecting transactions in or the balance of a deposit account or share account, and unless a court of competent jurisdiction determines, in an action filed by the depositor or share account holder against such bank or credit union before the expiration of seven years from the date of the rendering of the statement or the delivery of the passbook, that the statement or passbook was inaccurate or incomplete, then, upon the expiration of the seven-year period, at the option of such bank or credit union, the statement or passbook is deemed accurate and complete as of the date of the statement or the delivery and as to each transaction and any balance reflected in the statement or passbook, and such depositor or share account holder is thereafter barred from questioning the correctness of any transaction and any balance reflected therein for any cause. Nothing in this section shall be construed to relieve the depositor or share account holder from the duty imposed by law or contract of exercising due diligence in the examination of any such statement or passbook when rendered by the bank or credit union, and of immediate notification to the bank or credit union upon discovery of any error therein, nor from the legal consequences of neglect of such duty.

(1949 Rev., S. 5798; P.A. 94-122, S. 136, 340; P.A. 02-73, S. 32.)

History: P.A. 94-122 made technical changes, effective January 1, 1995; Sec. 36-76 transferred to Sec. 36a-295 in 1995; P.A. 02-73 added provisions making section applicable to Connecticut credit unions, share accounts and share account holders.

See Sec. 42a-4-406 re customers’ duty to discover and report unauthorized signature or alteration.

Sec. 36a-296. (Formerly Sec. 36-110). Deposits or share accounts in trust. (a)(1) No bank, Connecticut credit union, or federal credit union shall establish any deposit or share account in which deposits or shares are to be held by one natural person in trust for another natural person unless the depositor or share account holder provides the bank, Connecticut credit union, or federal credit union with the name and a residential address for the beneficiary, upon establishing the deposit or share account or thereafter at the request of the bank, Connecticut credit union, or federal credit union. The depositor or share account holder may also provide the bank, Connecticut credit union, or federal credit union with a writing signed by the depositor or share account holder specifying the terms of the trust under which such deposit or share account is to be held. Unless such writing specifies to the contrary, it shall be conclusively presumed that the depositor or share account holder intends to create a trust of all funds credited to the deposit or share account from time to time upon the following terms: (A) The depositor or share account holder during the depositor’s or share account holder’s life may withdraw, or authorize charges against, such funds; (B) if the depositor or share account holder survives the named beneficiary, the named beneficiary’s death shall terminate the trust and title to the deposit or share account shall thereupon vest in the depositor or share account holder free and clear of the trust; (C) if the named beneficiary survives the depositor or share account holder, the depositor’s or share account holder’s death shall terminate the trust and title to the deposit account or share account, subject to any membership restrictions for Connecticut credit unions or federal credit unions, shall thereupon vest in the named beneficiary free and clear of the trust. (2) Any bank, Connecticut credit union, or federal credit union shall be fully protected in making payment of any moneys credited to such deposit or share account in accordance with the terms of such signed writing or, in the event such writing does not specify to the contrary, in accordance with the presumptions contained in this subsection that are applicable, and the title of any person to any moneys credited to such deposit or share account and the effect of such signed writing with respect to the deposit or share account or, in the event such writing does not specify to the contrary, the effect of the presumptions contained in this subsection shall not be denied, abridged or in any way affected because such signed writing was not executed in accordance with, or otherwise fails to comply with, the laws of this state prescribing the requirements to effect a valid testamentary disposition of property or because of any absence of delivery or compliance with other requirements to effect a valid gift or transfer in trust. (3) The provisions of this subsection do not apply to deposit or share accounts accompanied by a writing of the type described in subsection (b) of this section or to any deposit or share account opened primarily for business or professional purposes, including, but not limited to, escrow accounts, trust accounts and clients’ funds accounts.

(b) In the case of a deposit or share account established or maintained with a bank, Connecticut credit union, or federal credit union by a trustee under a will or trust agreement or under the terms of some other written document, or by a trustee pursuant to statute or order of a court, the trustee shall provide the bank, Connecticut credit union, or federal credit union with a writing identifying such will, agreement, other written document, statute or order; and any moneys credited to a deposit or share account with respect to which the trustee has filed such a writing shall be paid only to or upon the order of such trustee or of the successor trustee. If the trustee is serving in such capacity under a will, trust agreement or other written document, a certified copy of such document shall be filed by the depositor or share account holder if at any time requested by the bank, Connecticut credit union, or federal credit union but such bank, Connecticut credit union, or federal credit union shall not be charged with notice, actual or constructive, of the contents of such will, trust agreement, or other written document. Such bank, Connecticut credit union, or federal credit union shall be fully protected in paying over any moneys credited to such deposit or share account to or upon the order of the trustee establishing or maintaining the deposit or share account or the successor trustee and shall be under no duty to inquire into the application of funds so paid.

(c) (1) Subsection (a) of this section applies to all deposit accounts governed by its provisions established (A) on or after June 13, 1963, and (B) prior to that date if the depositor when establishing such deposit account or at any time thereafter provides a writing meeting the requirements of subsection (a) of this section. Subsection (b) of this section applies to all deposit accounts governed by its provisions whether such deposit accounts were established prior to June 13, 1963, or are established on or after that date.

(2) Subsection (a) of this section applies to all share accounts governed by its provisions which are established at Connecticut credit unions and federal credit unions (A) on or after October 1, 2001, and (B) prior to that date if the share account holder when establishing such share account or at any time thereafter provides a writing meeting the requirements of subsection (a) of this section. Subsection (b) of this section applies to all share accounts governed by its provisions whether such share accounts were established prior to October 1, 2001, or are established on or after that date.

(1949, Rev., S. 5829; 1961, P.A. 306; 1963, P.A. 417; February, 1965, P.A. 95, S. 1; 1967, P.A. 461, S. 32; 1969, P.A. 504, S. 16; P.A. 87-569, S. 4; P.A. 92-12, S. 42; P.A. 94-122, S. 137, 340; P.A. 01-6, S. 1; P.A. 03-196, S. 8.)

History: 1961 act specified presumptions and effect of deposits in trust; 1963 act reorganized Subdiv. indicators in Subsec. (1), adding Subdiv. (c) re applicability to deposits and incorporating part of former Subsec. (2), inserted new Subsec. (2) and revised effective date provisions (formerly in Subsec. (2)) to reflect re organization of section and new provisions; 1965 act rephrased paragraph 1 of Subsec. (1)(a); 1967 act deleted references to “savings departments” of state bank and trust companies; 1969 act included national banking associations in purview of section; P.A. 87-569 amended the section to extend the application of the provisions to savings and loan associations; P.A. 92-12 redesignated Subsecs., Subdivs. and Subparas. and made technical changes; P.A. 94-122 clarified procedures for certain trust accounts and made technical changes, effective January 1, 1995; Sec. 36-110 transferred to Sec. 36a-296 in 1995; P.A. 01-6 added provisions re Connecticut and federal credit unions and share accounts throughout, made a technical change for purposes of gender neutrality in Subsec. (a) and amended Subsec. (c) by designating existing provisions as Subdiv. (1), making technical changes therein, and adding Subdiv. (2) re applicability of section to share accounts; P.A. 03-196 added references to share account holders, effective July 1, 2003.

Annotations to former section 36-110:

No valid trust can arise where sole ownership of the funds on deposit is in the person named as trustee. 146 C. 496. Effectuates intent of depositor to make a “poor man’s will” while retaining sole right to the moneys during his lifetime. 176 C. 663. Beneficiaries of savings account trusts created under the statute acquire no interest in the trusts during lifetime of depositor unless latter by unequivocal act renders them irrevocable. 186 C. 311. Cited. 226 C. 51.

Former Subsec. (1):

Subdiv. (a) cited. 172 C. 292.

Sec. 36a-297. (Formerly Sec. 36-111). Deposits or share accounts of minors. A minor may contract to establish a deposit account with any bank or share account with any Connecticut credit union or federal credit union, and may be the owner, or a joint owner, co-owner or beneficiary of any deposit account or share account. A minor who is an owner, co-owner or beneficiary of any deposit account or share account shall be bound by the terms of the deposit contract or share account contract governing such account, as amended by the bank or credit union from time to time, and any payment made or withdrawal permitted by such bank or credit union in accordance with the terms of the deposit contract or share account contract governing such account shall constitute a sufficient and valid release to such bank or credit union for such payment or withdrawal and shall be binding upon such minor and any other owner, co-owner or beneficiary of such deposit account or share account to the same extent as if such minor were over the age of majority. Unless made by such minor or by a person appointed as guardian of the estate of such minor, a bank, Connecticut credit union or federal credit union may treat any claim to a deposit account or share account made solely on behalf of a minor owner, co-owner or beneficiary of such deposit account or share account as an adverse claim under section 36a-293. This section shall not affect any rights of or obligations imposed on a parent, guardian or spouse of a minor under section 45a-631.

(1949 Rev., S. 5830; 1967, P.A. 461, S. 33; P.A. 94-122, S. 138, 340; P.A. 02-73, S. 33.)

History: 1967 act deleted references to “savings departments” of state bank and trust companies; P.A. 94-122 clarified the right of minors to jointly own, open or be beneficiaries of all bank accounts, not just savings and time accounts, and made technical changes, effective January 1, 1995; Sec. 36-111 transferred to Sec. 36a-297 in 1995; P.A. 02-73 added provisions making section applicable to credit unions, share accounts and share account contracts and made a conforming change.

Sec. 36a-298. (Formerly Sec. 36-106). Notice of withdrawals. Notwithstanding any contrary provisions of its charter or bylaws:

(1) Any Connecticut bank may require not more than three months’ notice for the withdrawal of savings deposits or time deposits from such bank; provided, during the period when any such bank is operating with such notice requirement in force, it may, nevertheless, in its discretion, pay such amount or amounts to any depositor weekly or at other intervals as it deems prudent; and

(2) In every case in which a notice of intention to withdraw moneys has been filed by a depositor, such notice is void and of no effect upon the actual withdrawal of the amount demanded and in any event shall be void one month after the expiration of the period specified therein.

(1949 Rev., S. 5825; 1967, P.A. 461, S. 28; P.A. 92-12, S. 40; P.A. 94-122, S. 139, 340.)

History: 1967 act deleted references to “savings departments” of state bank and trust companies; P.A. 92-12 redesignated Subsecs. and made technical changes; P.A. 94-122 extended to savings and loans the notice of deposit withdrawal provisions, deleted Subsec. lettering and relettered former Subsecs. (a) and (b) as Subdivs. (1) and (2), deleted Subsec. (c) and made technical changes, effective January 1, 1995; Sec. 36-106 transferred to Sec. 36a-298 in 1995.

Annotation to former section 36-106:

Cited. 142 C. 483.

Sec. 36a-299. (Formerly Sec. 36-9i). Permitted and prohibited transfers by negotiable withdrawal order. (a) A Connecticut bank may permit unlimited transfers by negotiable withdrawal order from a savings account consisting of savings deposits deposited to the credit of, or in which the entire beneficial interest is held by, one or more individuals, or by a corporation, partnership, association or other organization operated primarily for religious, philanthropic, charitable, educational, political, or other similar purposes and not operated for profit or from deposits of public funds by an officer, employee or agent of the United States or of any state, county, municipality or political subdivision thereof.

(b) A Connecticut bank may permit transfers by negotiable withdrawal order from savings accounts in which any beneficial interest is held by a corporation, partnership, association or other organization operated for profit, provided under the terms of the deposit contract or by practice of the bank, the depositor may make no more transfers than the number of transfers permitted under 12 CFR 204.2(d)(2).

(P.A. 73-195, S. 11, 14; P.A. 77-54, S. 2, 4; P.A. 81-472, S. 66, 159; P.A. 83-438, S. 3, 8; P.A. 94-122, S. 140, 340; P.A. 95-70, S. 7, 8; P.A. 11-216, S. 6.)

History: P.A. 77-54 replaced previous provisions which had prohibited transfer by negotiable withdrawal order from savings deposit in name of government, governmental agency, trade, corporation or partnership name or in name containing commercial, occupational or professional designation and had further prohibited such withdrawals from accounts “not in such a name” for governmental, commercial, occupational or professional purposes; Sec. 36-104l transferred to Sec. 36-9i in 1979; P.A. 81-472 made technical changes; P.A. 83-438 allowed state banks and trust companies, savings banks and savings and loan associations to accept public funds in the form of negotiable withdrawal orders; P.A. 94-122 allowed banks to provide NOW accounts to political organizations, effective January 1, 1995; Sec. 36-9i transferred to Sec. 36a-299 in 1995; P.A. 95-70 amended Subsec. (a) to specifically authorize “unlimited” transfer and to delete “only” re withdrawals from savings account and reference to corporations operated for “fraternal” purposes, effective May 31, 1995; P.A. 11-216 amended Subsec. (b) to add provision re practice of the bank and replace former limitation of no more than three transfers by negotiable withdrawal order or check made by depositor, and exceptions to such limitation, with limitation of no more transfers than number permitted under 12 CFR 204.2(d)(2), effective July 13, 2011.

Sec. 36a-300. (Formerly Sec. 36-108). School savings deposits and time deposits. The superintendent of any school system or the principal of any school, acting directly or indirectly through their authorized agents, who may be teachers, other school employees, members of a parent-teacher organization or such other natural persons as the superintendent or principal may designate, may from time to time collect savings deposits or time deposits from the pupils and deposit them within ten days from the day of collection in any bank. Such deposits shall be placed to the credit of the respective pupils from whom they have been collected or, if the amount collected at any one time is deemed by the bank insufficient for the opening of individual accounts, it shall be deposited in the name of such superintendent, principal or designated person in trust to be transferred eventually to the credit of, or to be repaid to, the respective pupils to whom the same belongs. Such superintendent, principal or designated person shall furnish such bank the names, signatures, addresses, ages, or dates of birth, parents’ or guardians’ names and such other data concerning the respective pupils as the bank may require. The bank shall be liable for any loss of savings deposits or time deposits collected under this section that occurs from the day of collection to the day of deposit.

(1949 Rev., S. 5827; 1967, P.A. 461, S. 30; P.A. 92-9, S. 1, 3; P.A. 94-122, S. 141, 340.)

History: 1967 act deleted reference to “savings departments” of state bank and trust companies; P.A. 92-9 added provisions re designation of authorized agents and liability for loss of savings collected; P.A. 94-122 consolidated school savings authority for all banks, extended it to include time deposits and made technical changes, effective January 1, 1995; Sec. 36-108 transferred to Sec. 36a-300 in 1995.

Sec. 36a-301. (Formerly Sec. 36-9q). Tax and loan accounts and note accounts. (a) As used in this section:

(1) “Tax and loan account” means an account, the balance of which is subject to the right of immediate withdrawal, established for receipt of payments of federal taxes and certain United States obligations. Such accounts are not savings accounts, savings deposits, demand accounts or demand deposits.

(2) “Note account” means a note, subject to the right of immediate call, evidencing funds held by depositories electing the note option under applicable United States Treasury Department regulations. Note accounts are not savings accounts, savings deposits, demand accounts or demand deposits.

(b) Subject to regulations of the United States Treasury Department, Connecticut banks may serve as depositories for federal taxes or as United States Treasury tax and loan depositories, and satisfy any requirement in connection therewith, including maintaining tax and loan accounts and note accounts, and pledging collateral.

(c) Connecticut banks shall pay a return on note accounts at the rates required by the United States Treasury Department.

(d) In addition to the requirements contained in the regulations of the United States Treasury Department, Connecticut banks shall meet all requirements in order to obtain any available insurance of deposits contained in tax and loan accounts and note accounts by the Federal Deposit Insurance Corporation.

(P.A. 82-129, S. 1, 2; P.A. 91-357, S. 4, 78; P.A. 92-12, S. 7; P.A. 94-122, S. 142, 340.)

History: P.A. 91-357 deleted reference to the Federal Savings and Loan Insurance Corporation from Subsec. (d); P.A. 92-12 made technical changes in Subsec. (a); P.A. 94-122 consolidated tax and loan account authority for all banks, effective January 1, 1995; Sec. 36-9q transferred to Sec. 36a-301 in 1995.

Sec. 36a-302. (Formerly Sec. 36-9v). Applicability of federal Expedited Funds Availability Act to banks and credit unions. Each bank, Connecticut credit union and federal credit union shall comply with the applicable provisions of the Expedited Funds Availability Act, 12 USC 4001 et seq. and regulations now and hereafter adopted thereunder, except that for the purposes of this section, the term “account” as defined in Section 229.2 of Regulation CC (12 CFR Part 229) includes savings accounts but does not include: (1) Accounts where funds deposited in such accounts are payable on a specified date or at the expiration of a specified time after the date of deposit; or (2) savings accounts opened or funded electronically.

(P.A. 84-164, S. 1; P.A. 85-194; P.A. 87-8; 87-9, S. 2, 3; 87-589, S. 10, 87; P.A. 89-131, S. 1, 2; May Sp. Sess. P.A. 92-11, S. 8, 70; P.A. 94-122, S. 143, 340; P.A. 08-5, S. 1.)

History: P.A. 85-194 inserted new provisions designated as Subsecs. (a), (c) and (d) prohibiting the imposition of a check hold period of greater than four business days for checks drawn on banks located in this state and seven business days for checks drawn on banks located out of state, making prior provisions Subsec. (b); P.A. 87-8 amended Subsec. (a) to shorten check hold periods to one business day for checks drawn on the same institution, three business days for checks drawn on institutions located in this state, and five business days for checks drawn on institutions located out of state; (Revisor’s note: Pursuant to P.A. 87-9 “banking commissioner” was changed editorially by the Revisors to “commissioner of banking”); P.A. 87-589 made technical change in Subsec. (c); P.A. 89-131 amended Subsec. (a) by adding numeric subdivision designations, changing numeric subparagraph designations to lettered designations and adding Subpara. (2) re compliance with the Expedited Funds Availability Act, amended Subsec. (b) by providing that the provisions of the subsection shall not apply after September 1, 1990, and amended Subsec. (d) by limiting the application of the subsection to prior to September 1, 1990; May Sp. Sess. P.A. 92-11 amended Subsecs. (a) and (b) to replace references to “subdivision (g) of subsection (1) of section 42a-4-104” with “subdivision (9) of subsection (a) of section 42a-4-104”; P.A. 94-122 deleted as obsolete provisions re time limits on deposit availability in Subsec. (a) and Subsecs. (b), (c) and (d), effective January 1, 1995; Sec. 36-9v transferred to Sec. 36a-302 in 1995; P.A. 08-5 designated existing provision re deposited funds payable on specified date or time as Subdiv. (1) and added Subdiv. (2) re savings accounts opened or funded electronically.

Sec. 36a-303. (Formerly Sec. 36-9o). Charge for overdraft, when prohibited. No bank, Connecticut credit union or federal credit union may charge a fee or a penalty for an overdraft if such overdraft is due to an error on a direct deposit tape of the Social Security Administration or an accidental omission from such tape.

(P.A. 79-248, S. 1, 2; P.A. 94-122, S. 144, 340.)

History: P.A. 94-122 applied the prohibition on overdraft charges to all state and federal banks and credit unions, effective January 1, 1995; Sec. 36-9o transferred to Sec. 36a-303 in 1995.

Sec. 36a-304. (Formerly Sec. 36-9bb). Cashing of state checks. Fee prohibited. Liability for loss from wrongful payment. (a) Each bank, Connecticut credit union and federal credit union shall cash, at its main office or any of its branch offices within this state, any check drawn by the state of Connecticut and payable within this state to a recipient of public assistance or state-administered general assistance or the refugee program, if the check is negotiated to the bank, Connecticut credit union or federal credit union by the original payee of the check, and if the payee produces reasonable identification as provided for in regulations adopted pursuant to section 36a-305. No bank, Connecticut credit union or federal credit union shall charge such recipient a fee for cashing a check pursuant to this section. Nothing in this section shall preclude a bank, Connecticut credit union or federal credit union from requesting a fee from the state of Connecticut for cashing such checks. The provisions of this subsection shall apply to a Connecticut credit union or federal credit union only if the original payee negotiating the check is a member of such credit union.

(b) Nothing in this section shall be interpreted as limiting any rights which the bank, Connecticut credit union or federal credit union may have against the payee by contract or at law, with regard to items which are negotiated to it as provided for in this section, which are not paid upon presentment or where such payee breaches a warranty made under section 42a-4-207 or 42a-4-208. This section shall not apply to any check negotiated to a bank, Connecticut credit union or federal credit union if such bank, Connecticut credit union or federal credit union has reason to believe that the check will not be paid on presentment or that the tendering party may be in breach of one or more of the warranties contained in section 42a-4-207 or 42a-4-208.

(c) No bank, Connecticut credit union or federal credit union shall be liable to reimburse the state of Connecticut for a loss incurred as the result of the wrongful payment of any check cashed pursuant to this section, provided at the time such check was cashed such bank, Connecticut credit union or federal credit union employed the identification procedures prescribed in regulations adopted pursuant to section 36a-305.

(P.A. 87-24, S. 1, 3; May Sp. Sess. P.A. 92-11, S. 9, 70; P.A. 94-122, S. 145, 340; June 18 Sp. Sess. P.A. 97-2, S. 100, 165.)

History: P.A. 87-24, Sec. 1 effective October 1, 1988, being the effective date of regulations adopted pursuant to Sec. 36-9cc; May Sp. Sess. P.A. 92-11 amended Subsec. (c) to add references to Sec. 42a-4-208; P.A. 94-122 deleted Subsec. (a), relettered Subsecs. (b), (c) and (d) as Subsecs. (a), (b) and (c), and made technical changes, effective January 1, 1995; Sec. 36-9bb transferred to Sec. 36a-304 in 1995; June 18 Sp. Sess. P.A. 97-2 amended Subsec. (a) to replace references to various sections in title 17b with reference to state-administered general assistance, effective July 1, 1997.

Sec. 36a-305. (Formerly Sec. 36-9cc). Regulations re cashing state checks. The Commissioner of Social Services, in cooperation with the commissioner, shall adopt regulations in accordance with chapter 54 specifying: (1) The forms of reasonable identification which a bank, Connecticut credit union or federal credit union shall accept when cashing a check pursuant to section 36a-304; and (2) the identification procedures such bank, Connecticut credit union or federal credit union shall employ to avoid liability for the wrongful payment of any such check.

(P.A. 87-9, S. 2, 3; 87-24, S. 2, 3; P.A. 92-12, S. 9; P.A. 93-262, S. 1, 87; P.A. 94-122, S. 146, 340.)

History: (Revisor’s note: Pursuant to P.A. 87-9 “banking commissioner” was changed editorially by the Revisors to “commissioner of banking”); P.A. 92-12 redesignated Subdivs.; P.A. 93-262 authorized substitution of commissioner and department of social services for commissioner and department of income maintenance, effective July 1, 1993; P.A. 94-122 made technical changes, effective January 1, 1995; Sec. 36-9cc transferred to Sec. 36a-305 in 1995.

Sec. 36a-306. Connecticut banks and Connecticut credit unions to accept identification cards, when. A Connecticut bank or Connecticut credit union shall accept any identity card issued by the Department of Motor Vehicles in accordance with section 1-1h as identification for establishing an account with the Connecticut bank or Connecticut credit union or for any other purpose for which the Connecticut bank or Connecticut credit union accepts as identification a motor vehicle operator’s license.

(P.A. 93-8; P.A. 96-109, S. 4.)

History: P.A. 96-109 substituted “Connecticut bank or Connecticut credit union” for “financial institution”.

Sec. 36a-307. (Formerly Sec. 36-9dd). Interest on savings deposit accounts. (a) For purposes of this section: (1) “Savings deposit account” means any account at a bank, Connecticut credit union or federal credit union into which deposits are made, where interest is paid periodically on such deposits and which is evidenced by the issuance of a passbook or, in lieu thereof, written receipts and periodic statements provided the deposits in such account (A) cannot be withdrawn by check or draft, and (B) are not payable on a specified date or at the expiration of a specified period of time after the date of deposit; and (2) “earning period” means the period during which interest accrues and at the end of which interest is credited to a savings deposit account.

(b) In the event a depositor withdraws all moneys from a savings deposit account before the end of the earning period during which interest accrues and at the end of which interest is credited, the bank, Connecticut credit union or federal credit union shall pay interest on a pro rata basis from the first day of the earning period to the date of withdrawal, provided Connecticut credit unions and federal credit unions may defer actual payment of such interest until the day following the date dividends are next scheduled to be declared by the Connecticut credit union or the federal credit union.

(P.A. 89-117; P.A. 94-122, S. 147, 340.)

History: P.A. 94-122 allowed credit unions to defer interest payments to depositors who withdraw funds before the end of the earning period until the day following the date dividends are next scheduled to be declared, effective January 1, 1995; Sec. 36-9dd transferred to Sec. 36a-307 in 1995.

Secs. 36a-308 to 36a-314. Reserved for future use.

PART II*

DEPOSIT ACCOUNT CONTRACT ACT

*Whether joint account has been established depends solely on deposit contract governing account; trial court improperly considered intent of person opening account. 47 CA 657.

Sec. 36a-315. (Formerly Sec. 36-27a). Short title: Deposit Account Contract Act. Sections 36a-315 to 36a-323, inclusive, shall be known and may be cited as the “Deposit Account Contract Act”.

(P.A. 79-433, S. 1, 11.)

History: P.A. 79-433 effective July 1, 1980; Sec. 36-27a transferred to Sec. 36a-315 in 1995.

Sec. 36a-316. (Formerly Sec. 36-27b). Definitions. As used in sections 36a-315 to 36a-323, inclusive:

(1) “Annual percentage yield” means a percentage rate reflecting the total amount of interest paid on funds in a deposit account calculated in compliance with the Federal Truth in Savings Act, Subtitle F of Title II of the Federal Deposit Insurance Corporation Improvement Act of 1991, Public Law 102-242, and the regulations promulgated thereunder, as from time to time amended.

(2) “Deliver” means deliver in person or place in the United States mail with first class postage properly affixed.

(3) “Deposit” means any demand deposit, savings deposit or club deposit, any deposit into a time account as defined in subdivision (18) of this section, and the payment on a share or time share at a Connecticut credit union or federal credit union.

(4) “Deposit account” means any account at a financial institution into which a deposit is made (A) which is in the name of one or more natural persons; (B) in which, with regard to a trust account, the entire beneficial interest is held by one or more natural persons, and (C) into which deposits may be made. “Deposit account” does not include a general or limited partnership account or a sole proprietorship business account.

(5) “Deposit contract” means the contract between a financial institution and a depositor that sets forth the terms, conditions, duties and obligations relating to a deposit account.

(6) “Deposit account charge” means a charge which may be imposed on a depositor for utilizing the services of a financial institution in connection with a deposit account, including a charge for: (A) Stop payment orders; (B) items drawn on a deposit account which are dishonored; (C) providing the depositor with a copy of any record relating to a deposit account; (D) the use of checks, negotiable orders of withdrawal, share drafts or other items, devices or methods that may be used to withdraw moneys from a deposit account; and (E) maintaining a deposit account, such as a service charge.

(7) “Deposit account disclosures” means the following information with regard to a deposit account: (A) The interest rate, if any, paid on funds deposited in the account; (B) the annual percentage yield, if any, paid on funds deposited in the account; (C) the frequency with which interest will be compounded and the frequency with which interest will be credited to the account; (D) the minimum amount which must be deposited in such account to open such account; (E) the minimum balance, if any, that must be maintained to earn the annual percentage yield; and (F) any condition relating to maintenance of a minimum balance for any part of the earning period which may cause interest not to be credited to such account at the end of the earning period.

(8) Except as provided in subdivision (4) of section 36a-323, “depositor” means any natural person who is legally entitled to make withdrawals or sell shares from a deposit account at a financial institution regardless of whether a penalty may be imposed for such withdrawal or sale.

(9) “Earning period” means the period during which interest accrues and at the end of which accrued interest is credited to a savings or time account.

(10) “Financial institution” means any bank, Connecticut credit union or federal credit union.

(11) “Interest” means any payment to a depositor or to a deposit account for the use of funds in a deposit account, calculated by application of a periodic rate to the balance. “Interest” does not include the payment of a bonus or other consideration worth ten dollars or less given during a year, the waiver or reduction of a fee, or the absorption of expenses.

(12) “Interest rate” means the annual rate of interest paid on a deposit account which does not reflect compounding. For the purposes of deposit account disclosures, the interest rate may be referred to as the “annual percentage rate” in addition to being referred to as the “interest rate”.

(13) “Office” of a financial institution does not include an automated teller machine or point of sale terminal.

(14) “Passbook savings account” means a savings account in which the depositor retains a book or other document in which the financial institution records transactions on the savings account.

(15) “Periodic statement” means a statement setting forth information about a deposit account, other than a time account or passbook savings account, that is provided to a depositor on a regular basis four or more times a year.

(16) “Post” means to post or otherwise provide notice in a location so that such notice is easily visible to depositors. With regard to an office at which a financial institution lacks access to space for posting notices, such as an office within a retail establishment, “post” means to make available to any depositor upon request.

(17) “Savings deposit” means a savings deposit, as defined in section 36a-2, and the payment on shares at a Connecticut credit union or federal credit union, and a “savings account” is a deposit account which contains savings deposits.

(18) “Time account” means (A) a deposit account with a maturity of at least seven days in which the depositor generally does not have a right to make withdrawals for six days after the account is opened, unless the deposit is subject to an early withdrawal penalty of at least seven days’ interest on amounts withdrawn, and (B) a Connecticut credit union member’s payment on shares which such member agrees in writing not to withdraw within the time period stated therein as described in subsection (b) of section 36a-456a.

(P.A. 79-433, S. 2, 11; P.A. 81-261, S. 1; P.A. 87-9, S. 2, 3; P.A. 92-12, S. 15; P.A. 93-168, S. 1, 8; P.A. 94-14, S. 1, 2; 94-122, S. 148, 340; P.A. 98-177, S. 2; 98-258, S. 2; P.A. 01-6, S. 3; P.A. 02-73, S. 76, 83; P.A. 04-136, S. 41; P.A. 08-176, S. 69.)

History: P.A. 79-433 effective July 1, 1980; P.A. 81-261 inserted new Subsecs. (b), (i) and (j) to define “deliver”, “office” and “post” respectively and relettered the remaining Subsecs. accordingly, amended Subsec. (d) to redefine “deposit account”, amended Subsec. (m) to provide that the schedule of interest recite the minimum amount which must be deposited to open an account and provide a format to recite the rate of simple interest and effective annual percentage yield when the interest rate varies, and rephrased and clarified certain of the other definitions; (Revisor’s note: Pursuant to P.A. 87-9 “banking commissioner” was changed editorially by the Revisors to “commissioner of banking”, and in 1991 an internal reference in Subdiv. (n) to “subdivision (b) of subsection (8)” was changed editorially by the Revisors to “subsection (g)”); P.A. 92-12 redesignated Subsecs. and Subdivs. and made technical changes; P.A. 93-168 added definitions of “annual percentage yield”, “deposit account charge”, “deposit account disclosures”, “interest”, “interest rate”, “passbook savings account”, “periodic statement” and “time account”, deleted definitions of “schedule of deposit account charges” and “schedule of interest”, amended the definition of “deposit” to include a time account, and renumbered the remaining Subdivs. accordingly, effective June 23, 1993, except that compliance by financial institutions shall be optional prior to the mandatory compliance date of the regulations applicable to the financial institution promulgated pursuant to the Federal Truth in Savings Act, Subtitle F of Title II of the Federal Deposit Insurance Corporation Improvement Act of 1991, Public Law 102-242, as from time to time amended, or January 1, 1994, whichever is sooner; P.A. 94-14 changed the January 1, 1994, compliance date to July 1, 1995, effective April 25, 1994; P.A. 94-122 deleted the definition of “commissioner” in Subdiv. (2), renumbered the remaining Subdivs. and made technical changes, effective January 1, 1995; Sec. 36-27b transferred to Sec. 36a-316 in 1995; (Revisor’s note: In 1997 the reference in Subdiv. (17) to “... savings deposit, as defined in subsection (49) of section 36a-2 ...” was corrected editorially by the Revisors to “... savings deposit, as defined in subsection (54) of section 36a-2 ...” to reflect the current internal numbering of that section); P.A. 98-177 made a technical change in Subdivs. (3), (8) and (17); P.A. 98-258 made a technical change in Subdiv. (17); P.A. 01-6 made technical changes in Subdiv. (18); P.A. 02-73 amended Subdiv. (17) by replacing reference to Subdiv. (55) with reference to Subdiv. (57) of Sec. 36a-2 and amended Subdiv. (18) by replacing reference to Sec. 36a-446(f) with reference to Sec. 36a-456a(b); P.A. 04-136 amended Subdiv. (17) to make a technical change, effective May 12, 2004; P.A. 08-176 made a technical change in Subdiv. (17), effective July 1, 2008.

Subdiv. (6):

Statute does not authorize bank which has established an ATM to levy surcharge or fee of any kind upon nondepositor customer. 45 CS 566.

Sec. 36a-317. (Formerly Sec. 36-27c). Prohibited acts of financial institutions. (a) Except as otherwise provided in sections 36a-315 to 36a-323, inclusive, no financial institution shall enforce or attempt to enforce any material term, condition, duty or obligation other than those required by law, federal or state governmental regulation, rule or order, court order or clearinghouse rule on any depositor with regard to a deposit account that is opened on or after July 1, 1980, unless such term, condition, duty or obligation is included in the deposit contract governing such account. The provisions of title 42a are “required by law” for the purposes of this subsection to the extent that such provisions are not varied by agreement.

(b) No financial institution shall impose or attempt to impose any deposit account charge that has not been disclosed to the depositor pursuant to section 36a-318 or 36a-320, as applicable, or is in an amount greater than the amount disclosed to the depositor pursuant to section 36a-318 or 36a-320, as applicable. Notwithstanding any provision of the general statutes to the contrary, check printing charges will be deemed to have been disclosed to the depositor if the financial institution discloses to the depositor (1) a range of prices, (2) that check printing charges may vary, or (3) that prices upon reorder may be higher than the price initially disclosed.

(c) No financial institution, other than a Connecticut credit union or federal credit union, shall pay or attempt to pay interest at a lower annual percentage yield than that disclosed to the depositor pursuant to section 36a-318 or 36a-321, as applicable.

(P.A. 79-433, S. 3, 11; P.A. 81-261, S. 2; P.A. 93-168, S. 2, 8; P.A. 94-14, S. 1, 2; 94-122, S. 149, 340.)

History: P.A. 79-433 effective July 1, 1980; P.A. 81-261 amended Subsec. (a) by adding “except as otherwise provided in this chapter”, replacing “impose” with “enforce” and providing that the provisions of title 42a are required by law to the extent that such provisions are not varied by agreement, and amended Subsecs. (b) and (c) by replacing “listed” with “recited”; P.A. 93-168 amended Subsec. (b) by adding a provision specifying actions which are deemed disclosure of check printing charges and made technical corrections for accuracy, effective June 23, 1993, except that compliance by financial institutions shall be optional prior to the mandatory compliance date of the regulations applicable to the financial institution promulgated pursuant to the Federal Truth in Savings Act, Subtitle F of Title II of the Federal Deposit Insurance Corporation Improvement Act of 1991, Public Law 102-242, as from time to time amended, or January 1, 1994, whichever is sooner; P.A. 94-14 changed the January 1, 1994, compliance date to July 1, 1995, effective April 25, 1994; P.A. 94-122 made technical changes, effective January 1, 1995; Sec. 36-27c transferred to Sec. 36a-317 in 1995.

Sec. 36a-317a. Charges for stop payment orders. A charge for a stop payment order made in accordance with section 36a-317 by a bank, Connecticut credit union or federal credit union, as those terms are defined in section 36a-2, shall cover the initial stop payment order that is effective for six months under subsection (b) of section 42a-4-403 and the first six-month renewal of such stop payment order.

(P.A. 00-15.)

Sec. 36a-317b. Check cashing. Adequate identification. Each bank, as defined in section 36a-2, shall cash, at its main office or any of its branch offices within this state, for any person any check payable at such bank or drawn on an account held at the bank in an amount up to and including five hundred dollars, provided the check is presented for payment by the payee of the check, there are sufficient available funds in the account on which the check was drawn to pay the check, and the person cashing the check provides adequate identification, and any information necessary for the bank to meet any reporting or recordkeeping requirements, as required by the bank. The bank may not require more than two forms of identification if the person provides one of the following forms of identification: (1) A current passport issued by the State Department of the United States, (2) a current motor vehicle operator’s license issued pursuant to section 14-36, or (3) any current identity card issued by the Department of Motor Vehicles in accordance with section 1-1h. Notwithstanding the provisions of this section, the bank may determine that it is reasonably necessary to refuse payment in order to protect its customer or the bank against potential fraud or loss, or to otherwise comply with applicable law.

(P.A. 01-175, S. 1; P.A. 03-171, S. 15.)

History: P.A. 03-171 amended Subdiv. (2) to delete reference to motorcycle operator’s license issued pursuant to Sec. 14-40a.

Sec. 36a-318. (Formerly Sec. 36-27d). Copy of deposit account contract and schedule of charges and interest to be furnished to depositors. Exceptions. Notice requirements. Notice re imposition of dormancy fees on inactive deposit accounts. (a) Except as provided in subsection (c) of this section, prior to opening a new deposit account for any depositor or prospective depositor: (1) Each financial institution shall deliver to such depositor or prospective depositor in written form which the depositor can keep a copy of (A) the deposit contract, (B) a listing of deposit account charges and the conditions under which such charges will be imposed including, but not limited to, failure to maintain a minimum balance, and (C) if such account is a time account, deposit account disclosures that govern such account; and (2) each financial institution, other than a Connecticut credit union or federal credit union, shall deliver to each depositor or prospective depositor deposit account disclosures that govern such account if such account is a savings account.

(b) The deposit account disclosures and listing of deposit account charges may be contained in more than one document and may be combined with disclosures, fees and contract terms for other accounts as long as the deposit account disclosures and deposit account charges are disclosed clearly and conspicuously and it is clear which deposit account disclosures and deposit account charges are applicable to the types of deposit accounts maintained by the depositor.

(c) If all or any part of a maturing or otherwise expiring time account is automatically deposited by renewal, roll-over or otherwise in a new deposit account within thirty days after expiration, the provisions of subsection (a) of this section shall not apply to such new account, except that if the annual percentage yield on such new account is lower than the annual percentage yield on the expiring account, and the maturing time account has a term to maturity of longer than thirty-one days, the financial institution shall deliver to the depositor the notice as required by this subsection. Such notice shall be delivered at least thirty calendar days before the maturity of the existing time account. Alternatively, such notice may be delivered at least twenty calendar days before the end of the grace period on the existing account, provided a grace period of at least five calendar days is allowed. For purposes of this subsection, a grace period means a period following the maturity of an automatically renewing time account during which the depositor may withdraw funds without being assessed a penalty. The notice shall recite the deposit account disclosures and deposit account charges, including the conditions under which such charges will be imposed, applicable to the new account, along with the date the existing account matures and the new maturity date if the account is renewed; provided if the interest rate and annual percentage yield that will be paid for the new account are unknown when the notice is provided, the notice shall state that those rates have not yet been determined, the date when they will be determined and a telephone number the depositor may call to obtain the interest rate and the annual percentage yield that will be paid for the new account. Notwithstanding any provisions of the general statutes to the contrary, if the term to maturity of the maturing time account is one year or less but longer than thirty-one days, the notice is not required to contain the information recited in this subsection other than (1) the date the existing account matures and the new maturity date if the account is renewed; (2) the interest rate and the annual percentage yield if they are known, or if the rates have not yet been determined, the date they will be determined and a telephone number the depositor may call to obtain the interest rate and the annual percentage yield that will be paid for the new account; and (3) any difference in the terms of the new account compared to the deposit account disclosures and deposit account charges governing the existing account.

(d) Except for deposit accounts for which a financial institution sends periodic statements, each financial institution that has a policy of imposing dormancy fees in connection with inactive deposit accounts shall, not less than fifteen days prior to the date the institution may impose a dormancy fee, mail a notice to the depositor. The notice shall be printed in capital letters in no less than twelve-point boldface type and shall state that the account will become inactive and that a dormancy fee may be imposed by the financial institution as a result of such inactivity. Such notice shall be mailed to the last-known mailing address maintained by the institution for the deposit account.

(P.A. 79-433, S. 4, 11; P.A. 81-261, S. 3; P.A. 93-168, S. 3, 8; P.A. 94-14, S. 1, 2; 94-122, S. 150, 340; P.A. 07-2, S. 1.)

History: P.A. 79-433 effective July 1, 1980; P.A. 81-261 rephrased the section and added Subsec. (b) to provide that the provisions of Subsec. (a) do not apply to an expiring time deposit which is renewed, rolled-over or otherwise deposited in a new account, except if the effective annual percentage yield on the new account is less than that on the expiring account the financial institution shall deliver a schedule of interest prior to the opening of the new account; P.A. 93-168 amended Subsec. (a) re requirement to provide in written form a copy of the deposit contract and list of deposit account charges, added a new Subsec. (b) allowing the use of more than one document in making any disclosures to the customer concerning deposit accounts maintained and amended former Subsec. (b), now designated as Subsec. (c), re the automatic renewal and roll-over of account funds and the ratification and accounting procedures required, effective June 23, 1993, except that compliance by financial institutions shall be optional prior to the mandatory compliance date of the regulations applicable to the financial institution promulgated pursuant to the Federal Truth in Savings Act, Subtitle F of Title II of the Federal Deposit Insurance Corporation Improvement Act of 1991, Public Law 102-242, as from time to time amended, or January 1, 1994, whichever is sooner; P.A. 94-14 changed the January 1, 1994, compliance date to July 1, 1995, effective April 25, 1994; P.A. 94-122 made technical changes and renumbered Subdivs. (A), (B) and (C) in Subsec. (c) as Subdivs. (1), (2) and (3), effective January 1, 1995; Sec. 36-27d transferred to Sec. 36a-318 in 1995; P.A. 07-2 added Subsec. (d) re notice requirements for imposition of dormancy fees on inactive deposit accounts.

Sec. 36a-319. (Formerly Sec. 36-27e). Deposit account disclosures. List of charges. Each financial institution, other than a Connecticut credit union or federal credit union, shall post in each office at which deposits are accepted for each type of deposit account a prospective depositor may open, current deposit account disclosures. Each financial institution shall post in each office at which deposits are accepted for each type of deposit account a prospective depositor may open, a listing of all current deposit account charges. The information required to be posted may be in multiple documents, signs, separate pages or combined with other information relating to the deposit accounts.

(P.A. 79-433, S. 5, 11; P.A. 81-261, S. 4; P.A. 93-168, S. 4, 8; P.A. 94-14, S. 1, 2; 94-122, S. 151, 340.)

History: P.A. 79-433 effective July 1, 1980; P.A. 81-261 deleted the requirement that the schedules be posted in a location easily visible to depositors; P.A. 93-168 required a posting of the list of all deposit account disclosures or charges, effective June 23, 1993, except that compliance by financial institutions shall be optional prior to the mandatory compliance date of the regulations applicable to the financial institution promulgated pursuant to the Federal Truth in Savings Act, Subtitle F of Title II of the Federal Deposit Insurance Corporation Improvement Act of 1991, Public Law 102-242, as from time to time amended, or January 1, 1994, whichever is sooner; P.A. 94-14 changed the January 1, 1994, compliance date to July 1, 1995, effective April 25, 1994; P.A. 94-122 made technical changes, effective January 1, 1995; Sec. 36-27e transferred to Sec. 36a-319 in 1995.

Sec. 36a-320. (Formerly Sec. 36-27f). Changes in deposit account charges. Notice. (a) A financial institution may delete or decrease any existing deposit account charges without notice. No financial institution shall impose any new deposit account charge or increase any existing deposit account charge unless the financial institution: (1) At least thirty days prior to such imposition or increase, posts a notice reciting such new or increased charge adjacent to, or incorporates such notice in, the current deposit account charges posted in each office at which deposits are accepted; and (2) delivers a notice reciting such new or increased charge to each depositor who has a deposit account which will be affected by such new or increased charge and for which such financial institution normally renders a periodic statement of account, which notice of new or increased charge shall be delivered (A) at least thirty days prior to such new or increased charge if any such periodic statement is normally rendered monthly or more frequently, or (B) no later than delivery of the next subsequent periodic statement after such new or increased charge if any such periodic statement is normally rendered less frequently than monthly.

(b) The prohibition in subsection (a) of this section does not apply to increases in check printing charges if the financial institution has previously disclosed to the consumer a range of prices, that check printing charges may vary or that prices upon reorder may be higher than the price initially disclosed.

(P.A. 79-433, S. 6, 11; P.A. 81-261, S. 5; P.A. 93-168, S. 5, 8; P.A. 94-14, S. 1, 2.)

History: P.A. 79-433 effective July 1, 1980; P.A. 81-261 rephrased certain parts of the section and established time periods for the delivery of a notice reciting new or increased charges depending upon the frequency with which the periodic statement is rendered to the depositor; P.A. 93-168 added Subsec. (b) re exception to the prohibition required under Subsec. (a) concerning increases in check printing charges, effective June 23, 1993, except that compliance by financial institutions shall be optional prior to the mandatory compliance date of the regulations applicable to the financial institution promulgated pursuant to the Federal Truth in Savings Act, Subtitle F of Title II of the Federal Deposit Insurance Corporation Improvement Act of 1991, Public Law 102-242, as from time to time amended, or January 1, 1994, whichever is sooner; P.A. 94-14 changed the January 1, 1994, compliance date to July 1, 1995, effective April 25, 1994; Sec. 36-27f transferred to Sec. 36a-320 in 1995.

Sec. 36a-321. (Formerly Sec. 36-27g). Changes in computation of interest or interest rate. Notice. (a) No financial institution, other than a Connecticut credit union or federal credit union, shall change its method of computing interest in such manner as to reduce the annual percentage yield on any savings account from that most recently disclosed to the depositor, including changes to disclosures delivered in accordance with section 36a-318, made in accordance with this section, unless the financial institution: (1) At least thirty days prior to such change, posts a notice reciting such reduction adjacent to, or incorporates such notice in, the current deposit account disclosures posted in each office at which deposits are accepted; and (2) delivers a notice reciting such reduction to each depositor who has a deposit account which will be affected by such reduction and for which such financial institution normally renders a periodic statement of account, which notice of reduction shall be delivered (A) at least thirty days prior to such reduction if any such periodic statement is normally rendered monthly or more frequently, or (B) no later than delivery of the next subsequent periodic statement after such reduction if any such periodic statement is normally rendered less frequently than monthly.

(b) No financial institution, other than a Connecticut credit union or federal credit union, shall reduce the interest rate and therefore the annual percentage yield paid on any savings account from that most recently disclosed to the depositor, including changes to disclosures delivered in accordance with section 36a-318, made in accordance with this section unless: (1) Within fifteen days after such change, such financial institution posts a notice reciting such reduction in interest rate and annual percentage yield adjacent to, or incorporates such notice in, the deposit account disclosures posted in each office at which deposits are accepted; and (2) such financial institution delivers a notice reciting such reduction in interest rate and annual percentage yield to each depositor who has a savings account which will be affected by such reduction and for which such financial institution normally renders a periodic statement of account, which notice of reduction shall be delivered no later than delivery of the next subsequent periodic statement, if any, after such reduction.

(c) A financial institution may, without notice, change its method of computing interest in such manner as to increase its annual percentage yield or may increase the interest rate, not to exceed any maximum set by law, and therefore the annual percentage yield paid on any deposit account from that most recently disclosed to the depositor, including changes to disclosures delivered in accordance with section 36a-318, made in accordance with this section.

(P.A. 79-433, S. 7, 11; P.A. 81-261, S. 6; P.A. 93-168, S. 6, 8; P.A. 94-14, S. 1, 2; 94-122, S. 152, 340.)

History: P.A. 79-433 effective July 1, 1980; P.A. 81-261 rephrased certain parts of the section, amended Subsec. (a) to establish time periods for the delivery of a notice reciting a reduction in interest due to a change in computation method depending upon the frequency with which the periodic statement is rendered to the depositor, and amended Subsec. (b) to require that a financial institution which reduces the simple interest rate deliver to each depositor a notice of reduction no later than delivery of the next subsequent periodic statement after such reduction; P.A. 93-168 changed all references of “schedule of interest” to “most recently disclosed changes to disclosures”, eliminated the use of “simple interest” in favor of “interest” and deleted the reference to “effective annual percentage yield” in favor of “annual percentage yield”, effective June 23, 1993, except that compliance by financial institutions shall be optional prior to the mandatory compliance date of the regulations applicable to the financial institution promulgated pursuant to the Federal Truth in Savings Act, Subtitle F of Title II of the Federal Deposit Insurance Corporation Improvement Act of 1991, Public Law 102-242, as from time to time amended, or January 1, 1994, whichever is sooner; P.A. 94-14 changed the January 1, 1994, compliance date to July 1, 1995, effective April 25, 1994; P.A. 94-122 made technical changes, effective January 1, 1995; Sec. 36-27g transferred to Sec. 36a-321 in 1995.

Sec. 36a-322. (Formerly Sec. 36-27h). Enforcement powers of commissioner. If the commissioner finds that a financial institution is violating the provisions of sections 36a-315 to 36a-323, inclusive, the commissioner may order such institution to make restitution to any depositor for any unlawful deposit account charge or overcharge imposed on, or any interest unlawfully withheld from, such depositor.

(P.A. 79-433, S. 8, 11; P.A. 94-122, S. 153, 340.)

History: P.A. 79-433 effective July 1, 1980; P.A. 94-122 made technical changes, effective January 1, 1995; Sec. 36-27h transferred to Sec. 36a-322 in 1995.

Sec. 36a-323. (Formerly Sec. 36-27i). Exceptions. Waivers. Notwithstanding any other provision of sections 36a-315 to 36a-323, inclusive:

(1) The provisions of sections 36a-315 to 36a-323, inclusive, shall not apply to any time account containing one hundred thousand dollars or more.

(2) The deposit contract, deposit account disclosures and disclosure of deposit account charges may exclude, and the provisions of sections 36a-315 to 36a-323, inclusive, do not apply to, any disclosures which are provided to a depositor in accordance with any provisions of the general statutes other than said sections or any federal law which expressly preempts the operation of said sections.

(3) For any deposit account which has more than one depositor, a financial institution need not deliver the deposit contract, deposit account disclosures, disclosure of deposit account charges and notices, when such delivery is required by sections 36a-315 to 36a-323, inclusive, to more than one of the depositors.

(4) At such time as any financial institution is authorized by law to accept a time deposit, the interest rate of which may vary during the term of such deposit, or at such time as interest rate ceilings on any type of savings deposit are no longer provided by law or are changing with sufficient frequency to justify, in the opinion of the commissioner, invoking the provisions of this subsection, the commissioner may issue an order waiving compliance with any or all of the provisions of sections 36a-315 to 36a-323, inclusive, by any one or more of such financial institutions with regard to such accounts for any period of time the commissioner may designate if, in the commissioner’s opinion, economic or competitive conditions are such that compliance with such provisions would be detrimental to depositors and other creditors of the institutions. For the purposes of this subsection, “depositors” means persons having deposits in financial institutions.

(P.A. 81-261, S. 7; P.A. 92-12, S. 16; P.A. 93-168, S. 7, 8; P.A. 94-14, S. 1, 2; 94-122, S. 154, 340.)

History: P.A. 92-12 redesignated Subsecs. and made technical changes; P.A. 93-168 deleted the references to “schedule of interest and schedule of deposit” and substituted “deposit account disclosure and disclosure of deposit” and made technical changes for consistency, effective June 23, 1993, except that compliance by financial institutions shall be optional prior to the mandatory compliance date of the regulations applicable to the financial institution promulgated pursuant to the Federal Truth in Savings Act, Subtitle F of Title II of the Federal Deposit Insurance Corporation Improvement Act of 1991, Public Law 102-242, as from time to time amended, or January 1, 1994, whichever is sooner; P.A. 94-14 changed the January 1, 1994, compliance date to July 1, 1995, effective April 25, 1994; P.A. 94-122 made technical changes, effective January 1, 1995; Sec. 36-27i transferred to Sec. 36a-323 in 1995.

Secs. 36a-324 to 36a-329. Reserved for future use.

PART III

PROTECTION OF PUBLIC DEPOSITS

Sec. 36a-330. (Formerly Sec. 36-382). Definitions. As used in sections 36a-330 to 36a-338, inclusive, unless the context otherwise requires:

(1) “Business day” means any day other than a Saturday, Sunday or day on which a financial institution is closed as required or authorized by state or federal law;

(2) “Close of business” means the time at which a financial institution closes for regular business operations on any business day;

(3) “Eligible collateral” means (A) United States treasury bills, notes and bonds, (B) United States government agency securities, (C) United States agency variable-rate securities, (D) mortgage pass-through or participation certificates or similar securities, (E) performing one-to-four-family residential mortgage loans that meet the following criteria: (i) The mortgage loan has a loan-to-value ratio which is less than or equal to eighty per cent for loans without private mortgage insurance, or a loan-to-value ratio which is less than or equal to ninety-five per cent for loans with private mortgage insurance; and (ii) the mortgage loan has a payment history of not more than one payment over thirty days in arrears during the past twelve consecutive months or, if the loan has a payment history of less than twelve months in duration, the loan meets the documentation requirements of the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation; provided, in the case of a subsequent default under any such mortgage loan that continues uncured for more than sixty days, such loan shall no longer qualify as eligible collateral and shall be replaced by a performing mortgage loan that meets the criteria set forth in this subdivision, and (F) state and municipal bonds;

(4) “Financial institution” means a bank, Connecticut credit union, federal credit union or an out-of-state bank that maintains in this state a branch as defined in section 36a-410;

(5) “Loss” means issuance of an order of supervisory authority restraining a qualified public depository from making payments of deposit liabilities or the appointment of a receiver for a qualified public depository;

(6) “Public deposit” means (A) moneys of this state or of any governmental subdivision of this state or any commission, committee, board or officer thereof, any housing authority or any court of this state and (B) moneys held by the Judicial Department in a fiduciary capacity;

(7) “Qualified public depository” or “depository” means a bank, Connecticut credit union, federal credit union or an out-of-state bank that maintains in this state a branch, as defined in section 36a-410, which receives or holds public deposits and, to the extent applicable, (A) segregates eligible collateral for public deposits as described in section 36a-333, or (B) arranges for a letter of credit to be issued in accordance with section 36a-337;

(8) “Uninsured public deposit” means the portion of a public deposit that is not insured or guaranteed by the Federal Deposit Insurance Corporation or by the National Credit Union Administration. For purposes of this subdivision, amounts of a public deposit that are insured by the Federal Deposit Insurance Corporation or the National Credit Union Administration include amounts that have been redeposited, with the authorization of the public depositor, into deposit accounts in one or more federally insured banks, out-of-state banks, Connecticut credit unions or federal credit unions, including the qualified public depository, provided the full amounts so included are eligible for insurance coverage by the Federal Deposit Insurance Corporation or by the National Credit Union Administration.

(1967, P.A. 517, S. 1; P.A. 77-614, S. 156, 587, 610; P.A. 78-303, S. 85, 136; P.A. 80-482, S. 259, 345, 348; P.A. 81-193, S. 11, 16; P.A. 83-331, S. 3; P.A. 84-510, S. 1, 5; P.A. 87-9, S. 2, 3; P.A. 91-245, S. 1; P.A. 92-12, S. 78; P.A. 94-122, S. 155, 340; P.A. 95-155, S. 22, 29; P.A. 08-39, S. 1; P.A. 11-50, S. 8; P.A. 12-96, S. 35, 36.)

History: P.A. 77-614 and P.A. 78-303 replaced definition of “commission”, i.e. Connecticut Public Deposit Protection Commission, and reference thereto, with definition of “commissioner”, i.e. banking commissioner within the department of business regulation, and like references, effective January 1, 1979; P.A. 80-482 deleted reference to abolished department of business regulation and restored commissioner as head of independent banking department; P.A. 81-193 amended Subsec. (b) by adding to the definition of “qualified public depository” the words “savings bank, federal savings bank, savings and loan association or federal savings and loan association”; P.A. 83-331 amended Subsec. (b) redefining “qualified public depository” to include state or federal credit unions; P.A. 84-510 amended Subsec. (a) to include moneys of housing authorities in the definition of “public deposit”; (Revisor’s note: Pursuant to P.A. 87-9 “banking commissioner” was changed editorially by the Revisors to “commissioner of banking”); P.A. 91-245 redefined “public deposit” to include moneys held by the judicial department in a fiduciary capacity, amended Subsec. (b) by adding “or depository”, redefined the term “eligible collateral” in Subsec. (e) and deleted Subsec. (f) defining “maximum liability”; P.A. 92-12 redesignated Subsecs. and Subdivs; P.A. 94-122 deleted the definition of “commissioner”, alphabetized the definitions and made technical changes, effective January 1, 1995; Sec. 36-382 transferred to Sec. 36a-330 in 1995; P.A. 95-155 added references to out-of-state banks in Subdiv. (2) and (5) and deleted references to public depositories in Subdiv. (4), effective June 27, 1995; P.A. 08-39 amended Subdiv. (5) to add provision re letter of credit issued in accordance with Sec. 36a-337 (Revisor’s note: In 2009, Subpara. designators “(i)” and “(ii)” in Subdiv. (5) were changed editorially by the Revisors to “(A)” and “(B)”, respectively, for consistency with customary statutory usage); P.A. 11-50 added new Subdivs. (1) and (2) defining “business day” and “close of business” and redesignated existing Subdivs. (1) to (5) as Subdivs. (3) to (7), effective June 13, 2011; P.A. 12-96 amended Subdiv. (7) to redefine “qualified public depository” by adding “to the extent applicable” and added Subdiv. (8) defining “uninsured public deposit”, effective June 8, 2012.

Sec. 36a-331. (Formerly Sec. 36-383). Protection of public deposits. All public deposits in qualified public depositories shall be protected against loss, as provided in sections 36a-330 to 36a-338, inclusive.

(1967, P.A. 517, S. 2; P.A. 91-245, S. 2; P.A. 94-122, S. 156, 340.)

History: P.A. 91-245 changed deadline for compliance from October 1, 1967, to October 1, 1991; P.A. 94-122 made technical changes, effective January 1, 1995; Sec. 36-383 transferred to Sec. 36a-331 in 1995.

Sec. 36a-332. (Formerly Sec. 36-385). Powers of commissioner. (a) The commissioner has the power (1) to require any qualified public depository to furnish such information as the commissioner shall request. Any public depository which refuses or neglects to give any information so requested shall no longer be a qualified public depository and shall be excluded from the right to receive public deposits; (2) to take such action as the commissioner deems best for the protection, collection, compromise or settlement of any claim arising in case of loss; and (3) to fix the official date on which any loss shall be deemed to have occurred taking into consideration the orders, rules and regulations of any supervisory authority as they affect the failure or inability of a qualified public depository to repay public deposits in full.

(b) The commissioner shall adopt regulations, in accordance with the provisions of chapter 54, to administer the provisions of sections 36a-330 to 36a-338, inclusive. Such regulations shall establish (1) requirements for the qualification of financial institutions as qualified public depositories, (2) other terms and conditions consistent with sections 36a-330 to 36a-338, inclusive, under which public deposits may be received and held, (3) requirements for financial institutions eligible to serve as trustees for segregated eligible collateral under subsection (b) of section 36a-333, (4) requirements for the transfer of eligible collateral from a qualified public depository to a financial institution serving as trustee for such collateral under subsection (b) of section 36a-333, (5) provisions governing the valuation of eligible collateral when the market value of such collateral is not readily determinable, and (6) such other provisions as the commissioner deems necessary to carry out the requirements of sections 36a-330 to 36a-338, inclusive.

(1967, P.A. 517, S. 4; P.A. 77-614, S. 157, 610; P.A. 91-245, S. 3; P.A. 94-122, S. 157, 340.)

History: P.A. 77-614 replaced “commission”, i.e. Public Deposit Protection Commission, with “commissioner”, i.e. banking commissioner, effective January 1, 1979; P.A. 91-245 designated existing section as Subsec. (a), deleted provisions re regulations and allocation of payments in case of loss, and added Subsec. (b) re regulations to administer the provisions of the chapter; P.A. 94-122 made technical changes, effective January 1, 1995; Sec. 36-385 transferred to Sec. 36a-332 in 1995.

Sec. 36a-333. (Formerly Sec. 36-386). Collateral requirements. (a) To secure public deposits, each qualified public depository shall at all times maintain, segregated from its other assets as provided in subsection (b) of this section, eligible collateral in an amount at least equal to the following percentage of uninsured public deposits held by the depository: (1) For any qualified public depository having a risk-based capital ratio of ten per cent or greater, a sum equal to ten per cent of all uninsured public deposits held by the depository; (2) for any qualified public depository having a risk-based capital ratio of less than ten per cent but greater than or equal to eight per cent, a sum equal to twenty-five per cent of all uninsured public deposits held by the depository; (3) for any qualified public depository having a risk-based capital ratio of less than eight per cent but greater than or equal to three per cent, a sum equal to one hundred per cent of all uninsured public deposits held by the depository; (4) for any qualified public depository having a risk-based capital ratio of less than three per cent, and, notwithstanding the provisions of subdivisions (1) to (3), inclusive, of this subsection, for any qualified public depository which has been conducting business in this state for a period of less than two years except for a qualified public depository that is a successor institution to a qualified public depository which conducted business in this state for two years or more, a sum equal to one hundred twenty per cent of all uninsured public deposits held by the depository; provided, the qualified public depository and the public depositor may agree on an amount of eligible collateral to be maintained by the depository that is greater than the minimum amounts required under subdivisions (1) to (4), inclusive, of this subsection; (5) notwithstanding the risk-based capital ratio provisions of subdivisions (1) to (3), inclusive, of this subsection, for any qualified public depository that is an uninsured bank, a sum equal to one hundred twenty per cent of all public deposits held by the depository; and (6) notwithstanding the risk-based capital ratio provisions of subdivisions (1) to (3), inclusive, of this subsection, for any qualified public depository that is subject to an order to cease and desist, consent order or a preliminary warning letter, or has entered into a stipulation and agreement, memorandum of understanding or a letter of understanding and agreement with a bank or credit union supervisor, a sum equal to one hundred twenty per cent of all uninsured public deposits held by the depository, or, in the case of such a qualified public depository that satisfies the requirements of subsection (f) of this section, a sum equal to one hundred per cent of all uninsured public deposits held by the depository. Notwithstanding the provisions of this subsection, the qualified public depository and the public depositor may agree on an amount of eligible collateral to be maintained by the depository that is greater than the minimum amounts required under subdivisions (1) to (6), inclusive, of this subsection. For purposes of this subsection, the amount of all uninsured public deposits held by the depository shall be determined at the close of business on the day of receipt of any public deposit and any deficiency in the amount of eligible collateral required under this section shall be cured not later than the close of business on the following business day. For purposes of this subsection, the depository’s risk-based capital ratio shall be determined, in accordance with applicable federal regulations and regulations adopted by the commissioner in accordance with chapter 54, based on the most recent quarterly call report, provided (A) if, during any calendar quarter after the issuance of such report, the depository experiences a decline in its risk-based capital ratio to a level that would require the depository to maintain a higher amount of eligible collateral under subdivisions (1) to (4), inclusive, or subdivision (6) of this subsection, the depository shall increase the amount of eligible collateral maintained by it to the minimum required under subdivisions (1) to (4), inclusive, or subdivision (6) of this subsection, as applicable, based on such lower risk-based capital ratio and shall notify the commissioner of its actions; and (B) if, during any calendar quarter after the issuance of such report, the commissioner reasonably determines that the depository’s risk-based capital ratio is likely to decline to a level that would require the depository to maintain a higher amount of eligible collateral under subdivisions (1) to (4), inclusive, or subdivision (6) of this subsection, the commissioner may require that the depository increase the amount of eligible collateral maintained by it to the minimum required under subdivisions (1) to (4), inclusive, or subdivision (6) of this subsection, as applicable, based on the commissioner’s determination of such lower risk-based capital ratio. For purposes of determining the minimum market value of the eligible collateral under subsection (e) of this section, a qualified public depository shall apply the collateral ratio using uninsured public deposits.

(b) Each qualified public depository having a risk-based capital ratio of eight per cent or greater shall transfer eligible collateral maintained under subsection (a) of this section to its own trust department, provided such trust department is located in this state unless the commissioner approves otherwise, to the trust department of another financial institution, provided such eligible collateral shall be maintained in such other financial institution’s trust department located in this state unless the commissioner approves otherwise, or to a federal reserve bank or federal home loan bank. Each qualified public depository having a risk-based capital ratio of less than eight per cent shall transfer eligible collateral maintained under subsection (a) of this section to the trust department of a financial institution that is not owned or controlled by the depository or by a holding company owning or controlling the depository, provided such eligible collateral shall be maintained in such other financial institution’s trust department located in this state unless the commissioner approves otherwise, or to a federal reserve bank or federal home loan bank. Such transfers of eligible collateral shall be made in a manner prescribed by the commissioner. Eligible collateral shall be valued at market value or as determined by the commissioner if market value is not readily determinable, and the value of such eligible collateral shall be determined and adjusted on a quarterly basis. Without the requirement of any further action, the commissioner shall have, for the benefit of public depositors, a perfected security interest in all such eligible collateral held in such segregated trust accounts, granted pursuant to and in accordance with the terms of the agreement between the public depositor and the qualified public depository. Such security interest shall have priority over all other perfected security interests and liens.

(c) The depository shall have the right to make substitutions of eligible collateral at any time without notice. The depository shall have the right to reduce the amount of eligible collateral maintained under subsection (a) of this section provided such reduction shall be determined based on the amount of all uninsured public deposits held by the depository and the depository’s risk-based capital ratio as determined in accordance with said subsection (a). The depository shall provide written notice to its public depositors of any such reduction in the amount of eligible collateral maintained under subsection (a) of this section.

(d) The income from the assets which constitute segregated eligible collateral shall belong to the depository without restriction.

(e) Eligible collateral pledged to secure public deposits under subsection (a) of this section shall have a minimum market value as expressed in the following collateral ratios:

Collateral Ratio

Form of Eligible

(Market value

Collateral Pledged

divided by public deposit plus accrued interest)

1. United States Treasury bills, notes and bonds

 A. Maturing in less than one year

102%

 B. Maturing in one to five years

105%

 C. Maturing in more than five years

110%

 D. Zero-coupon treasury securities with maturities exceeding ten years

120%

2. Actively traded United States government agency securities

 A. Maturing in less than one year

103%

 B. Maturing in one to five years

107%

 C. Maturing in more than five years

115%

3. United States government agency variable rate securities

103%

4. Government National Mortgage Association mortgage pass-through or participation certificates or similar securities

 A. Current issues

115%

 B. Older issues

120%

 C. Issues for which prices are not quoted

125%

5. Other United States government securities

125%

6. Other mortgage pass-through or participation certificates or similar securities

7. One-to-four family residential mortgages

125%

8. State and municipal bonds

 A. General obligation bonds

  i. Maturing in less than one year

102%

  ii. Maturing in one to five years

107%

  iii. Maturing in more than five years

110%

 B. Revenue bonds

  i. Maturing in less than one year

105-110%

  ii. Maturing in one to five years

110-120%

  iii. Maturing in more than five years

120-130%

(f) A qualified public depository that is subject to an order to cease and desist, consent order or a preliminary warning letter, or has entered into a stipulation and agreement, memorandum of understanding or a letter of understanding and agreement with a bank or credit union supervisor, may maintain eligible collateral in a sum equal to or greater than one hundred per cent of all uninsured public deposits held by the depository, provided (1) the depository has a risk-based capital ratio of twelve per cent or greater, and (2) the depository satisfies the following conditions, to the extent applicable: (A) The depository may not pledge eligible collateral in the form described in subsection (e)6. of this section, except for mortgage pass-through or participation certificates or similar securities that have been issued or guaranteed by the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation and for which prices are quoted; (B) the depository may not pledge eligible collateral in the form described in subsection (e)4.C. of this section; (C) if the public depository pledges eligible collateral in the form described in subsection (e)7. of this section, the collateral ratio for such mortgages shall be one hundred fifty per cent; and (D) if the public depository pledges eligible collateral in the form described in subsection (e)8. of this section, such collateral shall be rated in the three highest rating categories by a rating service recognized by the commissioner. The depository may pledge any other eligible collateral that is not limited by subdivision (2) of this subsection.

(1967, P.A. 517, S. 5; P.A. 77-614, S. 156, 587, 610; P.A. 78-303, S. 85, 136; P.A. 87-9, S. 2, 3; P.A. 91-245, S. 4; P.A. 94-122, S. 158, 340; P.A. 95-155, S. 23, 29; P.A. 03-196, S. 9; P.A. 04-136, S. 34; P.A. 05-39, S. 7; P.A. 06-10, S. 5; P.A. 11-50, S. 9; P.A. 12-96, S. 37–39.)

History: P.A. 77-614 and P.A. 78-303 allowed substitution of banking commissioner references for references to Public Deposit Protection Commission, effective January 1, 1979; (Revisor’s note: Pursuant to P.A. 87-9 “banking commissioner” was changed editorially by the Revisors to “commissioner of banking”); P.A. 91-245 deleted existing Subsecs. (a) and (b), added new Subsec. (a) re eligible collateral requirements, added new Subsec. (b) re segregation of eligible collateral, added notice requirements to Subsec. (c), made a technical change to Subsec. (d) and added Subsec. (e) re minimum market value for eligible collateral; P.A. 94-122 made technical changes, effective January 1, 1995; Sec. 36-386 transferred to Sec. 36a-333 in 1995; P.A. 95-155 added provisos in Subsec. (b) re location of the trust department and location at which eligible collateral is maintained, effective June 27, 1995; P.A. 03-196 added Subsecs. (a)(5) re collateral requirement for uninsured bank and (a)(6) re collateral requirement for depository that is subject to order to cease and desist, or has entered into a stipulation and agreement, or a letter of understanding and agreement with a bank or credit union supervisor, effective July 1, 2003; P.A. 04-136 amended Subsec. (a)(5) to delete reference to Sec. 36a-70(t)(1), effective May 12, 2004; P.A. 05-39 amended Subsec. (a) to provide that amount of all public deposits held by the qualified public depository shall be determined based on amount of public deposits reported on most recent written report filed with commissioner pursuant to Sec. 36a-338, in lieu of amount reported on most recent quarterly call report, effective May 17, 2005; P.A. 06-10 amended Subsec. (c) to provide that depository has authority to reduce amount of eligible collateral maintained under Subsec. (a) provided such reduction is determined based on amount of all public deposits held by depository and its risk-based capital ratio, effective May 2, 2006; P.A. 11-50 amended Subsec. (a) to add provisions re consent order, preliminary warning letter and memorandum of understanding and to replace provision re determining amount of all public deposits based on either deposits reported on most recent written report or average of deposits reported with provision re determining amount of all public deposits at close of business on day deposits are received, effective June 13, 2011; P.A. 12-96 amended Subsec. (a) by adding references to “uninsured” re public deposits, requirements re qualified public depository that satisfies requirements of Subsec. (f), references to “subdivision (6)” and provisions re determining minimum market value of eligible collateral and by making conforming changes, amended Subsec. (c) to add “uninsured” re public deposits and added Subsec. (f) re qualified public depository subject to cease and desist order, consent order or preliminary warning letter or that has entered into a stipulation and agreement, memorandum of understanding or letter of understanding and agreement, effective June 8, 2012.

Sec. 36a-334. (Formerly Sec. 36-387). Procedure upon loss. When the commissioner determines that a loss has occurred, the commissioner shall as soon as possible make payment to the proper public officers of all public deposits subject to such loss, pursuant to the following procedure: (1) For the purposes of determining the sums to be paid, the commissioner or receiver shall, within twenty days after issuance of a restraining order or taking possession of any qualified public depository, ascertain the amount of public deposits held by the depository as disclosed by its records and the amount of such deposits that are uninsured deposits and certify the amounts to each public depositor having public funds on deposit in the depository; (2) within ten days after receipt of such certification, each such public depositor shall furnish to the commissioner verified statements of its deposits in the depository as disclosed by its records plus information concerning any letters of credit issued to the public depositor or any private insurance policy used to secure public deposits, pursuant to section 36a-337; (3) upon receipt of such certificate and statements, the commissioner shall ascertain and fix the amount of such uninsured public deposits, net after deduction of any amount received or to be received by the public depositor pursuant to a letter of credit or private insurance policy issued in accordance with section 36a-337, and assess the same against the depository in which the loss occurred; (4) the assessment made by the commissioner shall be payable on the second business day following demand, and in case of the failure of the qualified public depository so to pay, the commissioner shall immediately take possession of the eligible collateral, if any, segregated by the depository pursuant to sections 36a-330 to 36a-338, inclusive, and liquidate the same for the purpose of paying such assessment; (5) upon receipt of the assessment, the commissioner shall reimburse the public depositors of the depository in which the loss occurred to the extent of the depository’s net deposit liability to them.

(1967, P.A. 517, S. 6; P.A. 77-614, S. 158, 610; P.A. 87-9, S. 2, 3; P.A. 91-245, S. 5; P.A. 92-12, S. 79; P.A. 94-122, S. 159, 340; P.A. 08-39, S. 2; P.A. 11-50, S. 10; P.A. 12-96, S. 41.)

History: P.A. 77-614 replaced bank commissioner with banking commissioner and references to Public Deposit Protection Commission with references to said commissioner, effective January 1, 1979; (Revisor’s note: Pursuant to P.A. 87-9 “banking commissioner” was changed editorially by the Revisors to “commissioner of banking”); P.A. 91-245 deleted provisions re assessment of loss against all other qualified public depositories in proportion to their maximum liability and made technical changes; P.A. 92-12 redesignated Subdivs; P.A. 94-122 made technical changes, effective January 1, 1995; Sec. 36-387 transferred to Sec. 36a-334 in 1995; P.A. 08-39 amended Subdiv. (2) to add requirement re information concerning letters of credit and Subdiv. (3) to add requirement re amount received or to be received pursuant to letter of credit and made a technical change in Subdiv. (4); P.A. 11-50 added provisions re private insurance policy used to secure public deposits in Subdivs. (2) and (3), effective June 13, 2011; P.A. 12-96 replaced “amount thereof covered by deposit insurance” with “amount of such deposits that are uninsured deposits”, added reference to “uninsured” re public deposits and deleted reference to deposit insurance, effective June 8, 2012.

Sec. 36a-335. (Formerly Sec. 36-388). Subrogation of commissioner to depositor’s rights. Upon payment to any public depositor, the commissioner shall be subrogated to all of such depositor’s right, title and interest against the depository in which the loss occurred and shall share in any distribution of its assets ratably with other depositors. Any sums received from any distribution shall be paid to the public depositors to the extent of any unpaid net deposit liability. If the commissioner incurs expense in enforcing any such claim, the amount thereof shall be paid as a liquidation expense of the depository in which the loss occurred.

(1967, P.A. 517, S. 7; P.A. 77-614, S. 159, 610; P.A. 91-245, S. 6.)

History: P.A. 77-614 replaced references to Public Deposit Protection Commission with references to banking commissioner, effective January 1, 1979; P.A. 91-245 deleted provisions re payments to qualified public depositories against which assessments were made; Sec. 36-388 transferred to Sec. 36a-335 in 1995.

Sec. 36a-336. (Formerly Sec. 36-389). Public deposits in qualified public depository or out-of-state bank. No public deposit shall be made except in a qualified public depository or in an out-of-state bank if (1) the deposit is permitted by a statute of this state and (2) such out-of-state bank provides eligible collateral for such deposit in excess of the Federal Deposit Insurance Corporation insurance limit in an amount satisfactory to the public depositor but in any event affording protection at least equal to that provided under sections 36a-330 to 36a-338, inclusive.

(1967, P.A. 517, S. 8; P.A. 81-193, S. 14, 16; P.A. 92-12, S. 80; P.A. 94-7, S. 3; 94-122, S. 160, 340.)

History: P.A. 81-193 deleted “Except as provided in section 36-392,”; P.A. 92-12 redesignated Subdivs; P.A. 94-7 amended section to require an out-of-state depository to provide collateral in excess of the Federal Deposit Insurance Corporation insurance limit; P.A. 94-122 made technical changes, effective January 1, 1995; Sec. 36-389 transferred to Sec. 36a-336 in 1995.

Sec. 36a-337. (Formerly Sec. 36-390). Securing of public deposits. (a) All qualified public depositories shall have power to secure public deposits in accordance with sections 36a-330 to 36a-338, inclusive. Except as provided in said sections, no bond or other security shall be required of or given by any qualified public depository for any public deposit.

(b) In lieu of eligible collateral required under section 36a-333, at least to the extent provided by said section, not more than fifty per cent of the public deposits held by any qualified public depository may be secured solely by a private insurance policy purchased by the depository, the depositor, or any other third party. Any private insurance policy used to secure public deposits shall be issued by an insurance company licensed to do business in Connecticut.

(c) In lieu of eligible collateral required under section 36a-333, all or any part of the uninsured public deposits held by any qualified public depository may be secured solely by an irrevocable letter of credit issued by a federal home loan bank that has a credit rating of the highest rating level from a rating service recognized by the commissioner or by a federal home loan bank that has otherwise been deemed acceptable for such purposes by the commissioner, provided the amount of the letter of credit when combined with any eligible collateral pledged by the depository, as a percentage of the uninsured public deposits, is no less than the amount required by section 36a-333 for eligible collateral for the particular depository.

(1967, P.A. 517, S. 9; P.A. 91-177; 91-245, S. 7; P.A. 94-122, S. 161, 340; P.A. 08-39, S. 3; P.A. 12-96, S. 40.)

History: P.A. 91-177 made technical changes to the existing section, designated said section as Subsec. (a), and added Subsec. (b) re private insurance in lieu of eligible collateral; P.A. 91-245 made technical changes; P.A. 94-122 made technical changes, effective January 1, 1995; Sec. 36-390 transferred to Sec. 36a-337 in 1995; P.A. 08-39 added Subsec. (c) re securing by irrevocable letter of credit issued by Federal Home Loan Bank of Boston; P.A. 12-96 amended Subsec. (c) by making technical changes, adding references to “uninsured” re public deposits, deleting reference to Federal Home Loan Bank of Boston and adding provisions re federal home loan bank that has otherwise been deemed acceptable and re amount of letter of credit combined with any eligible collateral pledged by depository, effective June 8, 2012.

Sec. 36a-338. (Formerly Sec. 36-391). Report of public depository. On each call report date, each qualified public depository shall file with the commissioner a written report, certified under oath, indicating (1) the qualified public depository’s risk-based capital ratio and total capital, as determined in accordance with applicable federal regulations and regulations adopted by the commissioner in accordance with chapter 54, (2) the total amount of public deposits held by the qualified public depository other than deposits that have been redeposited into the qualified public depository by another insured depository institution pursuant to a reciprocal deposit arrangement that makes such funds eligible for insurance coverage by the Federal Deposit Insurance Corporation or the National Credit Union Administration, (3) the amount and nature of any eligible collateral segregated and designated to secure the uninsured public deposits in accordance with sections 36a-330 to 36a-338, inclusive, and (4) the amount and the name of the issuer of any letter of credit issued pursuant to section 36a-337. Each depository shall furnish a copy of its most recent report to any public depositor having public funds on deposit in the depository, upon request of the depositor. Any public depository which refuses or neglects to furnish any report or give any information as required by this section shall no longer be a qualified public depository and shall be excluded from the right to receive public deposits.

(1967, P.A. 517, S. 10; P.A. 77-614, S. 160, 610; P.A. 87-9, S. 2, 3; P.A. 91-245, S. 8; P.A. 94-122, S. 162, 340; P.A. 08-39, S. 4; P.A. 12-96, S. 42.)

History: P.A. 77-614 replaced bank commissioner with banking commissioner and references to Public Deposit Protection Commission with references to said commissioner, effective January 1, 1979; (Revisor’s note: Pursuant to P.A. 87-9 “banking commissioner” was changed editorially by the Revisors to “commissioner of banking”); P.A. 91-245 added requirements for reporting risk-based capital ratio and total capital, deleted provisions re examination by the commissioner or the Comptroller of the Currency, required depositories to furnish copies of report to public depositories and provided for failure to do so, and made technical change; P.A. 94-122 made technical changes, effective January 1, 1995; Sec. 36-391 transferred to Sec. 36a-338 in 1995; P.A. 08-39 added report requirement re amount and name of issuer of letter of credit issued pursuant to Sec. 36a-337; P.A. 12-96 redesignated existing provisions re contents of report as Subdivs. (1), (3) and (4), added Subdiv. (2) re total amount of public deposits other than deposits redeposited into qualified public depository by another insured depository institution, added reference to “uninsured” re public deposits in Subdiv. (3) and made technical changes, effective June 8, 2012.

Secs. 36a-339 to 36a-349. Reserved for future use.