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U.S. Trust Company of North Carolina

FEDERAL DEPOSIT INSURANCE CORPORATION

IN RE: U.S. Trust Company of North Carolina
Greensboro, North Carolina
Application for Federal Deposit Insurance (Bank Insurance Fund) and Consent to Exercise Full Trust Powers

ORDER

The undersigned, acting under delegated authority, has fully considered all relevant facts and information relating to the factors of Section 6 of the Federal Deposit Insurance Act regarding the application for Federal deposit insurance and consent to exercise full trust powers for U.S. Trust Company of North Carolina, an operating noninsured state chartered bank operating as a nondepository trust company located at 301 North Elm Street, Greensboro, North Carolina, and has concluded that the applications should be approved.

Accordingly, it is hereby ORDERED, for the reasons set forth in the attached Statement, that the applications submitted by U.S. Trust Company of North Carolina for Federal deposit insurance and for consent to exercise full trust powers be and the same hereby are approved subject to the following conditions:

1. That the Tier 1 capital to assets leverage ratio will be maintained at not less than eight percent throughout the first three years of operation and that an adequate allowance for loan and lease losses will be provided;

2. That any changes in proposed management or proposed ownership (10 percent or more of stock including new acquisitions of or subscriptions to 10 percent or more of the stock), will render this commitment null and void unless any such change in proposed management or proposed ownership is approved by the FDIC prior to the opening of the depository institution;

3. That the applicant will continue using an accrual accounting system to maintain the books of the depository institution;

4. The applicant will have adequate fidelity coverage;

5. That the depository institution will obtain an audit of its financial statements by an independent public accountant annually for at least the first three years after deposit insurance is effective, furnish a copy of any reports by the independent auditor (including any management letters) to the New York Regional Director within 15 days after their receipt by the depository institution and notify the New York Regional Director within 15 days when a change in its independent auditor occurs;

6. That until the conditional commitment for deposit insurance and trust powers herein granted becomes effective, the FDIC shall have the right to alter, suspend, or withdraw said commitment should any interim development be deemed by the FDIC to warrant such action;

7. That the bank shall operate within the parameters of the business plan submitted to the FDIC. Furthermore, during the first three years of operations, the bank shall notify the New York Regional Director of any proposed major deviation or material change from the submitted plan 60 days before consummation of the change; and,

8. That if Federal deposit insurance has not become effective within twelve months from the date of the ORDER, or unless, in the meantime, the FDIC approves a request for an extension of time, the consent granted shall expire at the end of the said twelve-month period.

Dated at Washington, D.C., this day of June, 2000.

By: John M. Lane
Associate Director
Division of Supervision


FEDERAL DEPOSIT INSURANCE CORPORATION

IN RE: U.S. Trust Company of North Carolina
Greensboro, North Carolina
Application for Federal Deposit Insurance (Bank Insurance Fund) and Consent to Exercise Full Trust Powers

STATEMENT

Pursuant to the provision of Section 5 of the Federal Deposit Insurance Act (12 U.S.C. ? 1815), an application for Federal deposit insurance has been filed for U.S. Trust Company of North Carolina, an operating noninsured state chartered bank operating as a nondepository trust company located at 301 North Elm Street, Greensboro, North Carolina. Additionally, the institution has filed an application for consent to exercise full trust powers.

U.S. Trust Company of North Carolina is a wholly-owned subsidiary of NCT Holdings, Inc., Greensboro, North Carolina. NCT Holdings, Inc., is a wholly-owned subsidiary of U.S. Trust Corporation, a $4.9 billion multi-bank holding company headquartered in New York, New York. Through its subsidiaries, U.S. Trust Corporation specializes in asset management, private banking, and fiduciary services. The company serves affluent individuals, families, and institutions nationwide through its regional banking subsidiaries and limited purpose trust companies located in Connecticut, New York, New Jersey, Pennsylvania, Delaware, North Carolina, Florida, Texas, California, Oregon, and Washington, D.C. Each banking subsidiary has full banking and trust powers.

U.S. Trust Company of North Carolina was granted a limited purpose bank charter in 1983 as North Carolina Trust Company by the State of North Carolina Office of the Commissioner of Banks. The company opened for business in January 1984, providing high net worth individuals and their families, trusts and estates, not-for-profit organizations, and employee benefit plans with investment management, comprehensive planning, and fiduciary services. U.S. Trust Company of North Carolina's business grew to more than $2.5 billion in assets under management by August 1999.

Upon receipt of the necessary approvals, U.S. Trust Company of North Carolina proposes to operate as a nontraditional state nonmember commercial bank with full trust powers. It will offer private banking services only to depositors that have a net worth of at least $250,000, and who will use trust, investment advisory, and asset management services. Deposit products will include Federally insured checking accounts and money market accounts. Credit services to be offered include residential mortgages and other loans secured by real estate, at either fixed or floating interest rates. In addition, lines of credit as well as other secured and unsecured loan products will be offered. However, these services will be offered on accommodation basis for customers that use other services.

As of December 31, 1999, equity capital totaled $36,342 thousand. For regulatory capital purposes, goodwill totaling $31,706 thousand and a disallowed deferred tax asset of $361 thousand are deducted to arrive at U.S. Trust Company of North Carolina's capital levels and ratios. As of December 31, 1999, it had $4,275 thousand in Tier 1 and Total capital. Tier 1 leverage, Tier 1 risk-based, and Total risk-based capital ratios are 62.66%, 87.44%, and 87.44%, respectively. Pursuant to North Carolina banking statute, the Commissioner of Banks may determine the minimum capital amount required on a case-by-case basis, depending on the risk profile of the institution. The Commissioner has determined that U.S. Trust Company of North Carolina's current capital level, after deducting all intangibles, is adequate and acceptable for its risk profile.

On November 2, 1999, a public hearing was held on U.S. Trust Company of North Carolina's application to convert from a state-chartered nondepository trust company to a state-chartered bank before the State of North Carolina Office of the Commissioner of Banks. On November 17, 1999, the commissioner approved the applicant's charter conversion to a state-chartered commercial bank.

U.S. Trust Company of North Carolina's capital, management, financial history, future earnings prospects, ability to meet the convenience and needs of the community, consistency of corporate powers, and the risk to the Bank Insurance Fund are acceptable.

Accordingly, based upon careful evaluation of all available facts and information, the Associate Director, acting under delegated authority, has concluded that approval of the application is warranted, subject to the conditions enumerated in the ORDER.

ASSOCIATE DIRECTOR
DIVISION OF SUPERVISION
FEDERAL DEPOSIT INSURANCE CORPORATION



Last Updated 03/24/2011 Legal@fdic.gov