FEDERAL DEPOSIT INSURANCE CORPORATION
In Re: Sky Trust Bank, National Association Proposed National Bank)
Pepper Pike, Cuyahoga County, Ohio
Applications for Federal Deposit Insurance (Bank Insurance Fund) and for Consent to Merge
ORDER AND BASIS FOR CORPORATION APPROVAL
Pursuant to Sections 5 and 18(c) of the Federal Deposit Insurance (FDI) Act, applications have been filed on behalf of Sky Trust Bank, National Association (Sky Trust), Pepper Pike, Ohio, a proposed new bank with membership in the Bank Insurance Fund, and for consent to merge under its charter and title with Mid Am Private Trust, National Association (Mid Am), Cincinnati, Ohio, an uninsured trust company. Notice of the proposed transaction, in a form approved by the FDIC, has been published pursuant to the FDI Act.
The proposal is the result of the efforts by the holding company of the proposed institution, Sky Financial Group, Incorporated, Bowling Green, Ohio, to consolidate the trust operations of its banking subsidiaries and offer a full array of trust services in a multi-state environment. It would not effect the structure of banking or the concentration of banking resources within the relevant market. Services offered in the market by Sky Trust would not differ materially from those presently offered by Mid Am.
Since Sky Trust's principal focus will remain trust services, it has been designated a "special purpose" institution and is not subject to the Community Reinvestment Act.
In connection with the applications, the FDIC has also taken into consideration the competitive effects of the proposed transaction; the financial and managerial resources and future prospects of the proponent institution and the resultant bank; and the convenience and needs of the community to be served. The examination of Mid Am by the Office of the Comptroller of the Currency disclosed a generally satisfactory condition. Management is considered capable with extensive trust-related experience. Capital is adequate and expected to be well in excess of minimum regulatory requirements throughout the first three-year period after receiving deposit insurance. Earnings prospects are favorable. Having found favorably on the statutory factors and having considered all other relevant information, including any reports on the competitive factors furnished by the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, and the Attorney General of the United States, it is the FDIC's judgement that the applications should be and hereby are approved, subject to the following conditions:
(1) That beginning paid-in capital funds of not less than $3,000,000 be provided;
(2) That any changes in proposed management or proposed ownership (10 percent or more of stock) of the bank, including new acquisitions of or subscriptions to 10 percent or more of the bank's stock, will render this commitment null and void unless such proposal is approved by the Regional Director of the FDIC's Chicago Regional Office ("Regional Director") prior to opening of the bank;
(3) That Federal deposit insurance shall not become effective unless and until the applicant has been established as a national bank, that it has authority to conduct a banking business, and that its establishment and operation as a bank have been fully approved by the Office of the Comptroller of the Currency;
(4) That Sky Financial Group, Incorporated, Bowling Green, Ohio, a holding company, obtain approval from the Board of Governors of the Federal Reserve System to acquire voting stock control of the bank prior to its opening;
(5) That the bank shall operate within the parameters of the submitted business plan. Any proposed major deviations or material changes from the submitted plan which occur prior to opening for business and during the first 3 years after opening, in particular, changes pertaining to expansion of corporate powers, shall receive the prior written approval of the Regional Director;
(6) That the insured institution shall be engaged in the business of receiving deposits other than trust funds;
(7) That until the conditional commitment herein ORDERED becomes effective, the FDIC shall have the right to alter, suspend or withdraw the said commitment should any interim development be deemed to warrant such action;
(8) That if deposit insurance has not become effective within twelve months from the date of this ORDER, or unless, in the meantime, a request for an extension of time has been approved by the FDIC, the consent granted shall expire at the end of the twelve-month period; and
(9) That prior to opening for business, the Bank will assure that its electronic information systems are able to perform correctly all automated processing applications, including interactions and interdependencies with other automated systems, involving dates later than December 31, 1999, consistent with the standards and guidance provided by the Federal Financial Institutions Examination Council.
FEDERAL DEPOSIT INSURANCE CORPORATION
John M. Lane
Division of Supervision