Decisions on Bank Applications
Volvo Commercial Credit Corp of Utah
IN RE: Volvo Commercial Credit Corp of Utah
Salt Lake City, Salt Lake County, Utah
Application for Federal Deposit Insurance (Bank Insurance Fund)
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 for Volvo Commercial Credit Corp of Utah ("Volvo CCC"), a proposed new Utah industrial loan company to be located at 4179 South Riverboat Road, Suite 110, Salt Lake City, Salt Lake County, Utah, and has concluded that the application should be approved.
Accordingly, it is hereby ORDERED, for the reasons set forth in the attached Statement, that the application submitted by Volvo CCC for federal deposit insurance be and the same hereby is approved subject to the following conditions:
1. That beginning paid-in capital funds of not less than $10,000,000 be provided, and that a ratio of Tier 1 Leverage Capital to total assets of not less than eight percent shall be maintained throughout the first three years of operation;
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 stock, will render this commitment null and void unless such proposal is approved by the Regional Director of the FDIC's San Francisco Regional Office (Regional Director) prior to opening of the bank;
3. That Volvo CCC obtain an audit of 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 appropriate FDIC Regional Director within 15 days after their receipt by the bank and notify the appropriate FDIC Regional Director within 15 days when a change in its independent auditor occurs;
4. That adequate blanket bond coverage be obtained;
5. That an accrual accounting system be adopted for maintaining the bank's books;
6. That federal deposit insurance shall not become effective unless and until the applicant has been established as a state bank (not a member of the Federal Reserve System), that it has authority to conduct a banking business, and that its establishment and operation as a bank have been fully approved by the appropriate State Authority;
7. That until the conditional commitment herein granted becomes effective, the FDIC shall have the right to alter, suspend or withdraw said commitment should any interim development be deemed to warrant such action; and
8. That if federal 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 herein shall expire at the end of the said twelve-month period.
Dated at Washington, D.C. this day of March, 2000.
FEDERAL DEPOSIT INSURANCE CORPORATION
John M. Lane
Division of Supervision
FEDERAL DEPOSIT INSURANCE CORPORATION
IN RE: Volvo Commercial Credit Corp of Utah Salt Lake City, Salt Lake County, Utah Application for Federal Deposit Insurance (Bank Insurance Fund)
Pursuant to the provisions of Section 5 of the Federal Deposit Insurance Act (12 U.S.C. ? 1815), an application for federal deposit insurance has been filed for Volvo Commercial Credit Corp of Utah ("Volvo CCC"), a proposed new Utah industrial loan company, to be located at 4179 South Riverboat Road, Suite 110, Salt Lake City, Salt Lake County, Utah.
The applicant's ultimate parent is AB Volvo, a manufacturer of trucks, buses, construction equipment, marine and industrial engines, and military and commercial jet engines. In 1998, the parent company was the third largest worldwide manufacturer of heavy trucks and construction equipment and the second largest worldwide manufacturer of buses and produced approximately 82,000 medium and heavy trucks and 10,000 buses and bus chassis.
The proposed institution will provide commercial and consumer financing for the purchase of buses, construction equipment, and medium and heavy trucks produced by Volvo and other manufacturers. Additionally, the institution will offer an affinity credit card aimed at the transportation and construction industries. The proposed institution will have almost no direct contact with the public. The proposed new industrial loan company will operate from one location and will not offer any lobby, walk-up, or drive-up services. Time and NOW accounts will be offered to truck owner/operators.
For the purposes of this proposal, the investment in fixed assets is reasonable; capital is adequate; projections for future earnings prospects are favorable; and management is considered satisfactory. Corporate powers to be exercised are consistent with the purpose of the Federal Deposit Insurance Act. No formal objections to this proposal have been filed and no undue risk to the insurance fund is apparent.
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.
DIVISION OF SUPERVISION