INVESTMENTS AND OTHER POWERS

M.G.L. pt. Part I, tit. Title XXII, ch. c. 167F

in effect

M.G.L. c. 167F, § 1 Definitions

c. 167F, § 1. Definitions Section 1. As used in this chapter, the following words shall, unless the context otherwise requires, have the following meanings:— ''Bank'', an association or corporation chartered by the commonwealth under chapter 168, 170 or 172. ''Board'', the board of trustees or directors, as the case may be, in a bank. ''Capital stock'', the sum of the par value of the preferred and common shares of capital stock of a trust company, issued and outstanding. ''Commissioner'', the commissioner of banks. ''Federally chartered bank'', a national banking association, federal savings and loan association, federal savings bank or federal credit union authorized to do business in the commonwealth. ''Stock corporation'', an association or corporation chartered by the commonwealth under the provisions of chapter 168 or 170, which has converted to a stockholder form of corporation, or a trust company as defined in chapter 172. ''Surplus account'', an account so designated on the books of a bank and consisting of amounts required by law. ''Thrift Institution'', an association or corporation chartered by the commonwealth under chapter 168 or 170 which is in mutual form.

M.G.L. c. 167F, § 2 Powers

c. 167F, § 2. Powers Section 2. Every bank, subject to limitations imposed by this chapter or other general law, shall have the following powers and whatever further incidental or complimentary powers that may fairly be implied from those expressly conferred and those reasonably necessary to enable it to exercise fully those powers according to common customs and usages: 1. To discount, buy, invest in, hold, assign, transfer, sell and negotiate promissory notes, drafts, bills of exchange, mortgages, trade acceptances, banker's acceptances, bonds, debentures, bonds or notes secured by mortgages, installment obligations, accounts receivable, balances due on conditional sales and other evidences of debt for its own account or for the account of customers; 2. To invest in the bonds or other evidences of indebtedness of associations or trusts, both as defined in chapter one hundred and eighty-two, and of corporations; 3. To invest in the bonds or other evidences of indebtedness of governments, or political subdivisions thereof, both foreign and domestic; 4. To invest in the capital stock of any bank, national banking association, federal savings bank, federal or state savings and loan association or bank holding company; 5. To invest in the capital stock of any small business investment company organized under the provisions of the Small Business Investment Act of 1958 in an amount aggregating not more than two per cent of its capital stock and surplus account for a stock corporation or not more than two per cent of its surplus account for a thrift institution; to invest, subject to the approval of the commissioner, in the Minbanc Capital Corporation, a non-diversified closed end investment company created for the purpose of making capital funds available to qualifying minority owned banks, up to an amount not exceeding two per cent of its capital stock and surplus account for a stock corporation or not more than two per cent of its surplus account for a thrift institution; 6. To invest such amount not exceeding 10 per cent of its capital stock, surplus account, and undivided profits for a stock corporation and not exceeding 10 per cent of its surplus account for a thrift institution or any other such amount which may be authorized under 12 USC section 618, whichever is the greater, as the commissioner may approve in the capital stock of one or more corporations organized under the laws of the United States for the purpose of engaging in international or foreign banking or other internal or foreign financial operations, or in banking or other financial operations in a dependency or insular possession of the United States, and subject to the jurisdiction and supervision of the Board of Governors of the Federal Reserve System; 7. To acquire or invest in, with 10 days' advance notice to the commissioner, the capital stock or shares of 1 or more wholly-owned subsidiary corporations, limited liability companies or trusts, including any corporation or trust that is treated as a real estate mortgage investment conduit under 26 U.S.C. section 860D or such other forms of organization permitted by the commissioner, organized and operated solely for the purpose of performing functions that the bank itself is empowered to perform directly; provided however, that if the aggregate amount invested or proposed to be invested in any 1 subsidiary exceeds 50 per cent of tier 1 capital of the bank that excess investment shall be made only with the approval of the commissioner and under the limitations and conditions imposed by the commissioner. At the time of the notice or at any time the notice is pending, such a bank may request that the commissioner waive and the commissioner may waive the remaining notice period. 7A. To invest, subject to the approval of the commissioner and under such limitations or conditions as the commissioner may impose, in the capital stock or shares of 1 or more wholly owned subsidiary corporations, limited liability companies or trusts or such other forms of organization permitted by the commissioner, organized and operated solely for the purpose holding or investing in other real estate owned. 7B. To merge with 1 or more of its nonbank subsidiaries or affiliates with the bank as the continuing entity. 8. Such corporation may make any investment not otherwise eligible under any other provision of this chapter or any other provision of law including, but not limited to, investment in any capital stock of a corporation organized for the purpose of acquiring and managing interests in real property and acquiring, constructing, rehabilitating, leasing, financing and disposing of housing facilities, or in any other interest in real or personal property or activities incidental thereto, debt security, equity security, loan or community benefits; provided, however, that (a) not more than seven percent of the deposits of such corporation shall be invested pursuant to the provisions of this paragraph; and provided, further, that any amount in excess of three percent of said seven percent shall be invested by such corporation in the following manner: (i) in the capital stock of a corporation organized for the purpose of acquiring, constructing, rehabilitating, leasing, financing and disposing of housing facilities; (ii) for the purpose of micro-lending in the area of small business, including the fishing industry, and farm loans; and (iii) for the purpose of providing technical assistance to nonprofit housing corporations, small businesses and farms for the purpose of establishing credit worthiness; (b) no investment shall be made by such corporation in the equity securities of any one issuer pursuant to this paragraph if the aggregate amount invested by it in the equity securities of such issuer pursuant to this paragraph together with the amount invested in such securities pursuant to any other provision of law exceeds, or by the making of such investment will exceed, two percent of the deposits of such corporation, and no investment shall be made by such corporation in a loan to, or the debt securities of, any one issuer pursuant to this paragraph, if the aggregate amount invested by it pursuant to this paragraph together with the amount invested in a loan to, or in the debt securities, of such issuer pursuant to any other provision of law exceeds two percent of the deposits of such corporation; (c) any loan made or debt security purchased pursuant to this paragraph shall be secured over the term of the loan or the debt security; (d) this paragraph shall not be deemed to alter any provision of this chapter or other provision of law limiting the aggregate amount that may be invested in any class of loan or investment, except for (ii) and (iii), above, which shall be in addition to any such provision of this chapter or other provision of law; and (e) investments authorized solely by this paragraph shall not be deemed investments in which savings banks may legally invest for the purposes of any other provision of law which restricts investments to those in which savings banks may legally invest. 9. To purchase, hold and lease real estate suitable for the transaction of its business; provided, however, that if the aggregate amount invested and proposed to be invested therein, including the cost of alterations and additions in the nature of permanent fixtures exceeds, directly or indirectly, thirty percent of its capital stock and surplus account or one hundred percent of its capital stock whichever is greater, for a stock corporation or if such amount exceeds one hundred percent of surplus for a thrift institution such excess investment shall be made only with the approval of the commissioner. The amount of any mortgage on real estate owned by a bank directly or indirectly and used by it in whole or in part for the transaction of its business and the amount of money invested by a bank in the securities of any corporation, trust or other organization which holds real estate used in whole or in part for the transaction of the business of such bank or intended for such use, shall be included in determining the amount of real estate that may be held by such bank under this section; Any sums that may be recovered by a bank through the sale or other disposal of real estate or any part thereof held under this section, together with such sums as are allowable for ordinary depreciation under the provisions of the federal income tax law, and such additional sums as are taken on account of depreciation or obsolescence, or for other reason shall, with the consent of the commissioner or at his direction, be deducted from the amount considered to be invested in such real estate; 10. To invest an amount to be approved by the commissioner, subject to such regulations, if any, as he may deem necessary, in a corporation or association formed for the purpose of furnishing to such bank, or to other banks as hereinafter provided, statistical or bookkeeping services or information of the kind generally required by a bank. A bank may also, in participation with any other bank or national banking association, invest its deposits in such corporation or association, subject however to the same approval and regulation, if any, as above provided. The provisions of section two of chapter one hundred and sixty-seven shall apply to such corporations or associations. Nothing contained herein shall be construed to preclude a bank from renting or subscribing for the services of such corporations or association or any other corporation or association rendering such services; 11. To consent to any settlement, modification or readjustment of any investment in securities legally made by such corporation, and to accept and hold as investments bonds, notes, stocks and other securities offered in full or partial settlement, modification or readjustment of any such investment, pursuant to a reorganization or otherwise; 12. To act as trustee or custodian under a retirement plan or individual retirement account which in the judgment of such corporation at the time such trustee or custodian is accepted, is established pursuant to the provisions of Public Law 87–792 entitled ''Self–Employed Individuals Tax Retirement Act of 1962'', Public Law 93–406 entitled ''Employee Retirement Income Security Act of 1974'', section 152 of Public Law 95–600 entitled ''Revenue Act of 1978'', or sections 311 and 312 of the Economic Recovery Tax Act of 1981 Public Law 97–34, or pursuant to the provisions of sections 235 through 249, inclusive, of the Tax Equity and Fiscal Responsibility Act of 1982 Public Law 97–248, if the provisions of said plan have been approved by the commissioner and permit any of the funds of said trust or custodial account to be invested in savings deposits or time deposits of said bank. No funds held by said bank as trustee or custodian shall be invested otherwise than in bank deposits, properly qualified life insurance retirement income policies or other investments authorized by law for banks, or any combination thereof as such plan may prescribe or permit. Every advertisement, announcement, or solicitation for such a plan or account shall state in a clear and conspicuous manner the amounts of any contributions and earnings thereon, subject to state and federal taxable income; 13. To act as trustee for the holders of any bond issued by the Massachusetts Industrial Finance Agency, pursuant to the provisions of chapter twenty-three A or by any industrial development authority of any city or town pursuant to the provisions of chapter forty D or by the Massachusetts Health and Educational Facilities Authority, pursuant to the provisions of chapter six hundred and fourteen of the acts of nineteen hundred and sixty-eight. No funds held as a trustee shall be invested otherwise than in bank deposits or other legal investments for banks or any combination thereof, as may be prescribed by the trust instrument; 14. To issue or participate with other persons in the issuance of mortgage-backed securities which are guaranteed as to principal and interest by the United States or by an agency of the United States and are backed in whole or in part by mortgages held by such corporation, and may sell, assign or transfer to the United States or any agency of the United States any mortgage loan or interest in any mortgage loan held by such corporation; and in connection therewith such corporation may enter into and perform such agreements relating to the custody and servicing of such mortgages and to other matters as may be required pursuant to applicable regulations of any such agency. For purposes of this section, the Government National Mortgage Association and the Federal Home Loan Mortgage Corporation shall be deemed to be agencies of the United States; 15. To issue or participate with other persons in the issuance of securities representing units of interest in specific mortgage loans or pools or mortgage loans held by such corporation or other issuer, and in connection therewith may enter into and perform such arrangements relating to the custody and servicing of such mortgages and to other related matters, including without limitation provisions for guaranteeing collection or payment of the principal and interest on such securities, as may be found necessary and appropriate by the board of investment or applicable committee of such corporation; provided, however, that the commissioner may from time to time promulgate regulations governing the terms and conditions upon which any such securities may be issued; 16. To purchase by itself or with other banks group life insurance on the lives of debtors who request such insurance. The premium for such insurance, or the premium on an individual life insurance policy held to cover the indebtedness, may be added to the payments required of those who elect to become insured. In the event of the death of any debtor so insured, the insurance proceeds shall be applied to reduce or extinguish the unpaid indebtedness to the extent of such payment. No trustee, director, officer or employee of such bank shall benefit financially, directly or indirectly from the sale of such insurance; 17. To purchase by itself or with other banks group accident and health insurance covering debtors of such bank or group of banks if the debtors request such insurance. Such insurance shall cover all or part of the indebtedness of such debtors. The premium for such insurance, or the premium on an individual accident and health insurance policy held to cover the indebtedness, may be added to the payments required of any such debtor who elects to become insured. No trustee, director, officer or employee of such bank or group of banks shall benefit financially, directly or indirectly from the sale of such insurance; A bank which has purchased such group accident and health insurance shall send written notice to each such insured debtor thirty days prior to the effective date of any amendment to or cancellation of such insurance. Such notice shall be sent by mail to the last known address of the debtor and shall clearly state the effect such amendment or cancellation will have on the insured debtor. Such notice shall also be given by an advertisement in newspapers published daily or weekly and of general distribution in cities and towns in which the bank has an office, or if there be no such newspaper, then in a newspaper published in the county wherein the city or town is situated and of general distribution. Such notice shall be published at least seven days prior to the effective date of the amendment or cancellation and shall clearly state the effect on the insured debtors. 18. To indemnify its directors, trustees, officers, employees and other agents to whatever extent specified in or authorized by a by-law adopted pursuant to law. Such indemnification may include payment by the bank of expenses incurred in defending a civil or criminal action or proceeding in advance of the final disposition of such action or proceeding upon receipt of an undertaking by the person indemnified to repay such payment if he shall be adjudicated to be not entitled to indemnification under this section. Any such indemnification may be provided although the person to be indemnified is no longer an officer, director, trustee, employee or agent of the bank; No indemnification shall be provided for any person with respect to any matter as to which he shall have been adjudicated in any proceeding not to have acted in good faith in the reasonable belief that his action was in the best interests of the bank; A bank shall have power to purchase and maintain insurance on behalf of any person who is or was a director, trustee, officer, employee or other agent of the bank, against any liability incurred by him in any such capacity, or arising out of his status as such, whether or not the bank would have the power to indemnify him against such liability; 19. To provide group life insurance, group accident and health insurance or group medical, surgical or hospital insurance or benefits, or all or any combination thereof, for its employees, officers, and directors. The commissioner may, if he deems it necessary, establish regulations providing reasonable restrictions in connection therewith; 20. To establish, participate in, and act as trustee in an educational savings program approved by the commissioner whereby any person may purchase a specific plan in such program designed to provide for the education of a child upon his attaining college age. Such bank may purchase group life insurance on the lives of the debtors participating in such program. The premium for such insurance, or the premium on an individual life insurance policy held to cover the indebtedness, may be added to the payments required of any such debtor and the proceeds of any such insurance, dividends or premium refunds shall be applied by the bank for the sole benefit of the debtors in the manner provided in paragraph 16. No trustee, director, officer or employee of such bank shall benefit financially, directly or indirectly, from the sale of such insurance; 21. To buy and sell gold and silver bullion, foreign coin and exchange; 22. To accept for payment at a future date drafts and bills of exchange drawn upon it and to issue letters of credit authorizing holders thereof to draw drafts upon it, or its correspondents, at sight or on time; provided, that such acceptance of drafts be based upon actual values; and, provided, that no such corporation shall accept such bills or drafts to an aggregate amount exceeding at any one time one-half of its capital stock and surplus account for a stock corporation and one-half of its surplus account for a thrift institution, except with the approval of the commissioner, and in no case to an aggregate amount in excess of its capital stock and surplus account for a stock corporation or its surplus account for a thrift institution; 23. To accept drafts or bills of exchange drawn upon it and arising out of transactions involving the import or export of goods, having not more than six months' sight to run; provided, however, that no such corporation shall accept such bills to an aggregate amount exceeding at any time one-half of its capital stock and surplus account for a stock corporation or its surplus account for a thrift institution; 24. To rediscount notes, drafts and bills of exchange arising out of actual commercial transactions; 25. To act as financial or other agent for a person, association, trust, corporation, municipal corporation or government, and in their behalf to negotiate loans and the sale, purchase or other disposition or acquisition of securities or other property; 26. To act as fiscal agent of the United States, and of any corporation, state, county municipality, board, commission or other body politic, and to perform all duties as such fiscal agent as may lawfully be required of it; 27. To assist customers or act for customers in the preparation of payrolls and payroll deductions and in the preparation, maintenance and furnishing of records and statistical information; 28. To lease equipment, machinery, or personal property to customers provided that such equipment, machinery or personal property was acquired at the request of the customer and to maintain, and rent out for hire, at any location occupied by its principal office or any branch office, safe deposit boxes or other receptacles for the safe keeping of personal property upon such terms and conditions as may be agreed upon; 29. To contribute such sum or sums of money as the board of investment in a savings bank or the board of directors in a cooperative bank or trust company may determine to be reasonable, (a) to any private nonprofit organization organized for improving the social and economic conditions, including community development programs and small business technical assistance, in communities in which any such institution has an office or branch including any educational institution, (b) to any educational institution for the purpose of providing scholarships for the benefit of residents of such communities, or (c) to any fund being raised by a committee or agency for the purpose of relieving suffering or distress resulting from disaster or other calamity occurring in any part of the commonwealth; and 30. To participate in the small business capital access program created under section fifty-seven of chapter twenty-three A and to make the loans and create the reserve and take any and all other actions as may be necessary or appropriate for participating in such program. 30A. To participate in the activities of the growth capital division of the Massachusetts Development Finance Agency established in section 2 of chapter 23G by making capital available to the corporation by making an investment or deposit in or grant to said corporation, an affiliate or subsidiary of said corporation or any fund managed by said corporation. 31. To exercise any power and engage in any activity that is permissible for a federal bank or out-of-state bank, as defined in section 1 of chapter 167, by providing 30 days written notice in advance to the commissioner; provided, however, that the activity is not otherwise prohibited under the laws of the commonwealth; provided, further, that the activity shall be subject to the same limitations and restrictions that are applicable to the federal or out-of-state bank; and provided, further, that the activity authorized for the out-of-state bank has been permitted by the Federal Deposit Insurance Corporation under section 24 of the Federal Deposit Insurance Act and Part 362 of the regulations thereunder. In the event that federal or out-of-state banks lose the authority to exercise any power or engage in any activity based upon which comparable authority was granted to state chartered banks pursuant to this paragraph, unless such authority is authorized by another law of the commonwealth, or a rule, regulation or policy adopted pursuant to such other law of the commonwealth, or by a judicial decision, the authority shall be revoked for state chartered banks pursuant to this paragraph. At the time the notice is filed or at any time the notice is pending, a bank may request that the commissioner waive and the commissioner may waive the remaining notice period. 32. To engage in an activity and to acquire and retain the shares of any company engaged in any activity that the bank determines to be financial in nature or incidental to the financial activity that is complementary to a financial activity and does not pose a substantial risk to the safety and soundness of the bank by providing 30 days written notice in advance to the commissioner. At the time the notice is filed or at any time the notice is pending, a bank may request that the commissioner waive and the commissioner may waive the remaining notice period. In determining whether an activity is financial in nature or incidental or complementary thereto, the bank shall consider, but shall not be limited to, those activities considered to be financial in nature or incidental to the financial activity or an activity that is complementary to a financial activity under section 103, section 121 and section 122 of Public Law 106–102, entitled the federal Gramm–Leach–Bliley Act of 1999. Notwithstanding any general or special law to the contrary, this chapter does not authorize a bank or a subsidiary or affiliate of a bank to sell title insurance. 33. To participate in the redevelopment access to capital program created under section 60 of chapter 23A and to make the loans and create the reserve and take other actions necessary or appropriate for participating in the program.

M.G.L. c. 167F, § 2A Sale of insurance by banks

c. 167F, § 2A. Sale of insurance by banks Section 2A. (a) For purposes of this section, the word ''company'' shall mean an insurance company licensed pursuant to chapter 175 and the word ''affiliate'' shall have the same meaning as established in section 1 of chapter 167A. (b) A bank shall have the power to sell, either directly or indirectly through an affiliate or a subsidiary corporation established for the purpose or a third party agreement, and acting as an insurance producer licensed pursuant to section 162M or 162N of chapter 175, such insurance products as a company, for which such bank, affiliate, subsidiary corporation or third party acts as insurance producer, is authorized to issue in the commonwealth. No bank exercising such power shall assume or guarantee the payment on any premiums on such products or guarantee the truth of any statement contained in the application therefor. Said sales shall be conducted in accordance with conditions and limitations that the commissioner shall promulgate by regulation and which shall reflect the substance of conditions established by the comptroller of the currency of the United States governing the sale of insurance products by a national bank as a licensed agent of an insurance company. Said conditions and limitations shall be in addition to and consistent with the provisions of said chapter 175 and regulations promulgated thereunder by the commissioner of insurance with respect to the licensing of insurance producers and the sale of insurance products. Said conditions and limitations shall include, but not be limited to, the following provisions:— (1) No bank, except a bank licensed as an agent for the savings bank life insurance company of Massachusetts and only to the extent of the authority granted under such license, shall undertake to act directly or indirectly as an insurance producer, in any manner permitted by this section, until the commissioner approves a general plan of operation submitted by such a bank that conforms with the regulations promulgated pursuant to this section. Said plan shall include a detailed description of the complaint resolution procedure, including bank personnel designated for its enforcement, required pursuant to subparagraph (9) of this section. (2) Officers, tellers and other employees of a bank who are not licensed as insurance agents may refer a customer of said bank to a licensed insurance agent of the bank only when such customer initiates an inquiry relative to the availability or acquisition of insurance products. No such officer, teller or other employee shall be further or additionally compensated for making said referrals. (3) The solicitation or sale of insurance products shall be permitted at the main office of a bank, or at any branch thereof established pursuant to chapter 167C, or at any other bank office, not including an electronic branch established pursuant to chapter 167B. Said solicitation or sale shall be conducted on the premises of a bank in a distinctly designated area which is separate and apart from any physical setting in which services for insured deposit account transactions or transactions involving applications for the extension of credit are conducted. The commissioner may waive the requirement for the physical separation of bank and insurance services only upon a demonstration by a bank that space considerations, such as the size or design of said bank premises, preclude such separation. The commissioner may allow for such use of a common area for both purposes if, subject to notice and hearing at the commissioner's discretion, said waiver application demonstrates physical constraints that are consistent with criteria the commissioner shall establish for such waivers. In any instance where such waiver is granted, a bank employee, licensed as an insurance agent, shall not, in any manner involving the application by a customer for an extension of credit by said bank, act as the representative of the bank both with respect to said application and with respect to the solicitation and sale of insurance products to said customer, whether or not such insurance is required for the extension of credit. It shall be the responsibility of a bank to institute procedures to eliminate customer misunderstanding or confusion as to the distinction between such insurance products and other bank functions, and to prevent any misrepresentation thereof. Notwithstanding the foregoing, any premises constructed, purchased, leased or acquired by a bank on and after the effective date of this section for the conduct of its authorized business, including the solicitation and sale of insurance, shall not be eligible for the waiver provided for herein, unless said acquisition results from a merger, consolidation or purchase of assets pursuant to chapters 168, 170 and 172. (4)(i) A bank is hereby prohibited from tying the availability and extension of credit by a bank to the purchase of insurance products from said bank. (ii) No solicitation for the sale of insurance in conjunction with any application for the extension of credit shall be permitted until said application has been approved, such approval and the disclosures required by this section have been provided to said applicant in writing, and the receipt of both said approval and disclosures has been acknowledged in writing by said applicant. The date, time and method of the communication of said approval and disclosures to the applicant, together with the applicant's acknowledgment of the receipt thereof, shall be made a permanent part of the bank record of such extension of credit. This paragraph shall not apply in situations where a bank contacts a customer in the course of direct or mass marketing of insurance products to a group of persons in a manner that bears no relation to any such person's loan application or credit decision. (iii) In the instance of an application to a bank for an extension of credit to be secured by a mortgage on real estate and in which it is necessary for the applicant to obtain a policy insuring said premises against loss and designating such bank as loss payee, (i) said bank shall make the initial disclosure of the necessity of such insurance in its letter of commitment to the applicant approving the requested extension of credit; (ii) such bank shall not, in any manner, solicit the applicant to purchase the required insurance from the bank until said commitment has been accepted by the applicant; and (iii) such bank shall not reject any such policy, so long as it satisfies the required insurance, because the policy was issued by a company other than that for which the bank acts as agent in the sale of insurance products. (5) Rebates shall be regulated pursuant to the provisions of section 185 of chapter 175. (6) A bank, through its licensed insurance producers, shall disclose in writing to a potential insurance customer that: (i) the insurance products which are available are not deposits of the bank, are not protected by the federal deposit insurance corporation or any other type of deposit insurance, are not an obligation of or guaranteed by the bank, and may be subject to risk; (ii) any insurance required as a condition of the extension of credit by the bank need not be purchased from the bank but may, without affecting the approval of the application for an extension of credit, be purchased from an agent or insurance company of the customer's choice; and (iii) the customer may file any complaints with the office of consumer affairs and business regulations as hereinafter provided. The disclosures required by this section shall be provided in writing, and receipt thereof shall be acknowledged in writing by the customer. (7) Bank customer information security and confidentiality shall be regulated pursuant to the provisions of chapter 175I of the General Laws and the provisions of the federal Fair Credit Reporting Act. (8) No bank engaged in the direct sales of insurance products shall discriminate against an applicant or allow an affiliate, a subsidiary corporation established for the purpose or a third party acting on its behalf to discriminate against an applicant for any insurance products offered by it based upon the race, color, national origin or residence of the applicant, or on such other basis as the commissioner may determine. No bank offering insurance products at its main office or any branch thereof established pursuant to chapter 167C, shall refuse to offer the same at every such branch of the bank. (9) A bank engaged in the direct sale of insurance products, or an affiliate, subsidiary corporation or third party acting on its behalf, shall forthwith forward copies of all customer complaints relative to its insurance sales activities to the office of consumer affairs and business regulation established by section 1 of chapter 24A. The director of said office shall cause a record of all such complaints received to be maintained and shall, depending upon the nature of the complaint, refer any such complaint for resolution to the appropriate banking or insurance regulator in the division of banks and loan agencies or the division of insurance. The commissioner, in conjunction with the commissioner of insurance, shall establish a procedure for the prompt resolution of such consumer complaints. Regulations promulgated by the commissioner under this section shall include provisions for investigation and resolution by a bank of customer complaints and for the requirement to forward all complaints so received to the office of consumer affairs and business regulation. (c) Any violations of the provisions contained in this section shall be subject to the applicable provisions of chapter 167, including, but not limited to, sections 2A to 2G, inclusive, and to applicable provisions of chapter 175 and chapter 176D, including, but not limited to, penalties, cease and desist orders, and suspension or loss of license. (d) The provisions of this section shall not be applicable to the authority granted by paragraphs 16 and 17 of section 2 of chapter 167F and section 12G of chapter 255. (e) The commissioner shall promulgate regulations necessary to carry out the provisions of this section. (f) For purposes of this section, the term ''bank'' shall include small loan companies licensed pursuant to section 96 of chapter 140, and mortgage lenders and mortgage brokers licensed pursuant to chapter 255E; provided, however, that the provisions of clause (i) of paragraph (6) shall not apply to such small loan companies or to such mortgage lenders and mortgage brokers which do not accept deposits; and provided, further, that said licensees shall be eligible to apply to the commissioner of banks for a waiver, in accordance with the provisions of this section, for premises utilized for the conduct of authorized business in the commonwealth. (g) Notwithstanding any other provision of law to the contrary, the commissioner, in his discretion, may furnish to the commissioner of insurance information, reports and statements relating to the sale of insurance by banks under his supervision which are licensed by the division of insurance pursuant to section 209 of chapter 175.

M.G.L. c. 167F, § 3 Investments; classes of stocks

c. 167F, § 3. Investments; classes of stocks Section 3. Notwithstanding any provision of this chapter or any other provision of law, any bank may invest in the following classes of stocks in accordance with the conditions, limitations and requirements prescribed herein: 1. Insurance Company Stocks—In the capital stock of any insurance company authorized to conduct fire and casualty business in the commonwealth subject to the following conditions. No insurance stock shall be purchased if the cost thereof added to the cost of insurance stocks and bank stocks already owned exceeds 662/3 per cent of the total of the capital stock and surplus account for a stock corporation or the surplus account for a thrift institution. 2. Shares of Certain Bank Investment Funds—In the shares of beneficial interest of the Savings Bank Investment Fund and the Co-operative Bank Investment Fund; provided, however, that no such corporation shall invest in any such shares of any class representing a beneficial interest in any distinct investment fund consisting in whole or in part of equity securities (a) if the cost thereof added to the cost of such shares of an equity fund already owned shall exceed fifty per cent of the total of one capital stock and surplus account for a stock corporation or the surplus account for a thrift institution, or (b) if the cost thereof added to the amount already invested in such shares of such equity fund and in stocks shall exceed the total of such capital stock and surplus account for a stock corporation or surplus account for a thrift institution; and provided, further, that a corporation may invest in any such shares of any class representing a beneficial interest in any distinct investment fund which is not an equity fund to an amount in excess of one hundred per cent of the capital stock and surplus account of a stock corporation or to an amount in excess of one hundred per cent of the surplus account of a thrift institution except insofar as the commissioner may by regulation set limits and conditions on the amount which may be invested in such shares. 3. Utility Company Stocks—In the preferred and common stock of any company which, at the time of such investment, is incorporated under the laws of the United States or any state thereof, or the District of Columbia, and authorized to engage, and engaging, in the business of furnishing telephone service in the United States, or any gas, electric light or water company incorporated or doing business in the commonwealth and subject to the control and supervision thereof. No such corporation shall invest in such preferred or common stocks if the cost thereof added to the cost of such preferred or common stocks already owned exceeds 35 per cent of the total of the capital stock and surplus account for a stock corporation or the surplus account of a thrift institution. No corporation shall invest more than.5 of 1 per cent of its deposits in the stock of any 1 such company. 4. Preferred and Common Corporate Stock—In the preferred and common stock of any corporation organized under the laws of the United States or any state and any association defined herein to mean an association the business of which is conducted or transacted by trustees under a written instrument or declaration of trust; provided, however, not more than four per cent of its deposits shall be invested in the stocks so authorized and provided, further, that in addition to such four per cent, an amount equivalent to one per cent of its deposits may be invested in stocks of Massachusetts corporations or companies with substantial employment in the commonwealth which have pledged to the commissioner that such monies will be used for further development within the commonwealth. No bank shall make an investment pursuant to this paragraph in any such corporation or association controlled by said bank. For the purposes of this paragraph a bank shall be deemed to control a corporation or association if: (1) the bank owns or controls twenty-five per cent or more of the voting stock of any such corporation or association; or (2) the bank, in any manner controls the election of a majority of the directors of any such corporation or association; or (3) twenty-five per cent or more of the vote or voting stock of any such corporation or association is held by trustees for the benefit of said bank. 5. Prudent Investments—In the shares of stock registered on a national securities exchange as provided in the Securities Exchange Act of 1934, 15 USC 78a or for which quotations are available through the National Association of Securities Dealers Automated Quotations System, or any comparable service designated by the commissioner; provided that not more than fifteen per cent of the assets of such corporation shall be invested pursuant to the provisions of this paragraph, and such investment shall be made in the exercise of the judgment and care consistent with the prudent man rule, so-called.

M.G.L. c. 167F, § 4 Selling, issuing or registering checks or money orders; multi-state licensing system

c. 167F, § 4. Selling, issuing or registering checks or money orders; multi-state licensing system [Text of section effective until January 1, 2026. For text effective January 1, 2026, see below.] Section 4. Any bank, a national banking association or savings and loan association authorized to do business in the commonwealth, may engage directly in the business of selling, issuing or registering checks or money orders, except that trust companies and national banks may engage in such business through agents who shall not be deemed to be branches of such banks. No person, other than the foregoing, shall engage in such business directly or indirectly unless he files on or before January fifteenth in each year a sworn statement setting forth his name and address, the names and business addresses of his agents, other than a bank, a national banking association or savings and loan association, authorized to receive money and transact such business on his behalf. Such person shall deposit and maintain with the state treasurer a surety bond, cash or securities, in a sum of one hundred thousand dollars. Any such bond or deposit shall be held as security for the payment of checks or money orders sold by such person or his agents, and the commissioner may make such rules and regulations as may be necessary for the enforcement of this section, including an investigation relative to reputation, integrity and net worth, the cost of which investigation shall be chargeable to such person. Each person to whom a certificate to engage in such business has been issued shall on or before the fifteenth of April, July and October of each year notify the commissioner of any change in the list of agents contained in the annual statement, and shall file with him the name of any additional agent appointed or of any agent whose authority has been revoked. There shall be a fee for the filing of such annual statement payable to the commissioner and for each agent listed in the annual statement or in any addition thereto, the amount of such fees shall be determined annually by the commissioner of administration under the provisions of section three B of chapter seven for the filing thereof. The commissioner may issue a certificate to engage in such business to any person who in his judgment has complied with the provisions of this section, but he may, at any time, revoke such certificate for failure to comply with the provisions of this section, or of any rule or regulation promulgated by him, or for failure to pay any check or money order upon presentation for payment. Whoever violates any provision of this section or any rule or regulation established hereunder shall be punished by a fine of not more than one hundred dollars for each day during which such violation continues. The commissioner may participate in a multi-state licensing system for the sharing of regulatory information and for the licensing and application, by electronic or other means, for entities engaged in the business of selling, issuing or registering checks or money orders. The commissioner may establish requirements for participation by an applicant in a multi-state licensing system which may vary from the provisions of this section. The commissioner may require a background investigation of each applicant for a license to engage in the business of selling, issuing or registering checks or money orders by means of fingerprint and state and national criminal history record checks by the department of criminal justice information services pursuant to section 172 of chapter 6 and the Federal Bureau of Investigation. If the applicant is a partnership, association, corporation or other form of business organization, the commissioner may require a background investigation for each member, director and principal officer of the applicant and any individual acting as a manager of an office location. The applicant shall pay directly to the multi-state licensing system any additional fees relating to participation in the multi-state licensing system. Chapter 167F: Section 4. Selling, issuing or registering checks [Text of section as amended by 2024, 312, Sec. 1 effective January 1, 2026. See 2024, 312, Sec. 5. For text effective until January 1, 2026, see above.] Section 4. A bank may engage directly in the business of selling, issuing or registering checks.

M.G.L. c. 167F, § 5 Federal Home Loan Bank; membership; investment in stock

c. 167F, § 5. Federal Home Loan Bank; membership; investment in stock Section 5. A bank may become a member of the Federal Home Loan Bank established for the district of New England under the provisions of an act of Congress, approved July twenty-second, nineteen hundred and thirty-two, as amended, and known as the Federal Home Loan Bank Act, or of any successor of said bank; and may terminate such membership at any time. A bank may subscribe to and invest in such amounts of the stock of said home loan bank or of any such successor as may be required by law to qualify such corporation for membership therein.

M.G.L. c. 167F, § 8 Subscription for and acquisition of stock issued by Federal Reserve Bank of Boston

c. 167F, § 8. Subscription for and acquisition of stock issued by Federal Reserve Bank of Boston Section 8. Any such bank may subscribe for and acquire stock issued by the Federal Reserve Bank of Boston for the purpose of qualifying for membership in the federal reserve system, and while a member of such system may have and exercise any and all of the corporate powers and privileges which may be exercised by federal reserve member banks.

M.G.L. c. 167F, § 9 Membership in certain organizations

c. 167F, § 9. Membership in certain organizations Section 9. Such bank may, by vote of its board of investment, or board of directors, obtain memberships in certain organizations, and may make contributions and donations and subscribe for services, subject to the conditions, and requirements of this section. 1. Banking Association Memberships. — Such corporation may become a member of any association organized to protect and promote the interests of banking institutions, and may pay for such membership its proportionate share of the expenses as is reasonable and necessary. 2. Miscellaneous Memberships. — Such corporation may become a member of or contribute to any other association or organization in the commonwealth if, in the opinion of said board, such membership or contribution is reasonable and of substantial benefit to such corporation and its depositors. 3. Subscriptions to Services. — For the purposes of promoting, protecting or conserving the assets of banking institutions, such corporation may subscribe for services, including advertising and professional services, rendered or to be rendered collectively through an association referred to in paragraph 1 or through any group of banking institutions; and in each such case the corporation, with the approval of the board, may pay for such services its proportionate share of the total cost thereof or such other amount as said board shall deem reasonable and proper.

M.G.L. c. 167F, § 10 Investment, etc. in services from another bank for purposes of obtaining or furnishing technology, trust services, operation functions, staff, etc.

c. 167F, § 10. Investment, etc. in services from another bank for purposes of obtaining or furnishing technology, trust services, operation functions, staff, etc. Section 10. A bank may or in participation with a federal bank, a foreign bank, an out-of-state bank or an out-of-state federal bank, as defined in section 1 of chapter 167 invest in, establish, operate or subscribe for services from another bank, federal bank, foreign bank, out-of-state bank or out-of-state federal bank or a subsidiary thereof or any other business entity for the purpose of obtaining for or furnishing to the bank technology, trust services, financial planning, compliance, internal audits, human resource or other operation functions, management or staff generally required by a bank.

Source: Massachusetts General Court (malegislature.gov)URL: https://malegislature.gov/Laws/GeneralLaws/PartI/TitleXXII/Chapter167FFetched: 10/20/2026