N.J. Stat. tit. 17, ch. 16E

in effect

N.J. Stat. § 17:16E-1 Purpose

The purpose of this act is to further fair competition among financial institutions by prohibiting certain interlocking relationships among institutions located in the same municipality, or in contiguous or adjacent municipalities. L.1975, c. 265, s. 1, eff. Jan. 1, 1976.

N.J. Stat. § 17:16E-1.1 Compliance of bank, savings bank with prohibition on interlocking relationships

25. Any bank or savings bank that is in compliance with the federal "Depository Institution Management Interlocks Act," 12 U.S.C. s.3201 et seq. and the federal regulations effectuating that act, 12 C.F.R. s.348, is deemed to be in compliance with the provisions of sections 1 through 6 of P.L.1975, c.265 (C.17:16E-1 et seq.). L.1997,c.33,s.25.

N.J. Stat. § 17:16E-2 Definitions

For the purposes of this act: a. "Financial institution" shall include State or National bank, trust company, savings bank, State or Federal savings and loan association, State or Federal credit union and bank holding company. b. "Municipality" means a municipality located in the State of New Jersey and shall include city, town, township, village, borough, and any municipality governed by a board of commissioners or improvement commission. c. Municipalities shall be considered contiguous when their boundaries touch or coincide at any point. d. Municipalities shall be considered adjacent when they are located in such close proximity to one another or within the same market area as shall be determined to be adjacent by the Commissioner of Banking. e. "Manager" means a member of a board of directors or a member of a board of managers of a savings bank. L.1975, c. 265, s. 2, eff. Jan. 1, 1976.

N.J. Stat. § 17:16E-3 Mutual directors, officers or managers of financial institutions in same, adjacent, or contiguous municipalities; prohibition

Except as otherwise provided in section 6 of this act no person who is a director, officer or manager of a financial institution which has a principal or branch office in a particular municipality shall serve as a director, officer or manager of another financial institution which has a principal or branch office in the same municipality or in a contiguous or adjacent municipality. L.1975, c. 265, s. 3, eff. Jan. 1, 1976.

N.J. Stat. § 17:16E-4 Rules and regulations; waiver of prohibition; determination of adjacent municipalities

The Commissioner of Banking shall, in accordance with the "Administrative Procedure Act," P.L. 1968, c. 410 (C. 52:14B-1 et seq.), make and issue such rules and regulations as are necessary or appropriate to enforce the provisions of this act and effectuate its purpose. The Commissioner of Banking may, upon formal application and for good cause shown, waive the application of this prohibition if special circumstances warrant such action and when such waiver is in the public interest, for a period of 2 years. In establishing criteria for determining when municipalities are adjacent to one another for the purposes of section 2(d) of this act, the Commissioner of Banking shall consider the prohibition on interlocking relationships among banks which is imposed by Federal law, regulation, rule or practice on banks which are members of the Federal reserve system. L.1975, c. 265, s. 4, eff. Jan. 1, 1976.

N.J. Stat. § 17:16E-5 Interlocking relationships existing prior to this act; termination

Any interlocking relationship prohibited by section 3 of this act which existed prior to the effective date of this act may continue for such a reasonable period of time as may be necessary to terminate one or more of the relationships involved in an orderly manner, but all such interlocking relationships shall be terminated within 1 year after the effective date of this act. L.1975, c. 265, s. 5, eff. Jan. 1, 1976.

N.J. Stat. § 17:16E-6 Bank holding companies and financial institutions with common ownership; inapplicability of act

Nothing in this act shall prevent a person who is a director or officer of a bank holding company from being a director or officer of any one or more banks which are subsidiaries of such company, nor shall anything in this act prevent a person who is a director or officer of a bank which is a subsidiary of a bank holding company from being a director or officer of any one or more other banks which are subsidiaries of such holding company. When there are two or more financial institutions in which more than 50% of the stock is owned directly by the same persons, a person who is a director or officer of any one of such financial institutions may be a director or officer of any one or more of such other institutions. L.1975, c. 265, s. 6, eff. Jan. 1, 1976.

Source: Open US Law by Vaquill AI (CC BY 4.0)URL: https://www.njleg.state.nj.us/legislative-activity/statutesFetched: 10/17/2026