{"formats":[{"name":"JSON","format":"json","url":"\/downloads\/2025\/code-json\/6.2-885.json"},{"name":"Plain Text","format":"text","url":"\/downloads\/2025\/code-text\/6.2-885.txt"},{"name":"XML","format":"xml","url":"\/downloads\/2025\/code-xml\/6.2-885.xml"},{"name":"HTML","format":"html","url":"\/downloads\/2025\/code-html\/6.2-885.html"}],"law_id":64536,"edition_id":1,"section_id":64536,"structure_id":14189,"section_number":"6.2-885","catch_line":"Investment in stock or securities of controlled subsidiary corporations","history":"1968, c. 270, \u00a7 6.1-58.1; 1978, c. 797; 1988, c. 296; 1993, c. 64; 1997, c. 277; 1999, c. 60; 2001, c. 508; 2003, cc. 536, 558; 2010, c. 794.","full_text":"A\n\nAs used in this section and §§ 6.2-886, 6.2-887, and 6.2-888:\n\t\t\t“Control” has the meaning assigned to it in § 2 of the Bank Holding Company Act of 1956 (12 U.S.C. § 1841 et seq.).\n\t\t\t“Controlled subsidiary corporation” means a corporation that is controlled by a bank organized under the laws of the Commonwealth, or by more than one bank, at least one of which is organized under the laws of the Commonwealth.B\n\nA bank may acquire, own, and hold the stock, securities, or obligations of one or more controlled subsidiary corporations. Such investment in stock, securities, or obligations, together with any investment of the bank in stock, securities, or obligations of a bank service corporation, shall not exceed in the aggregate 50 percent of the bank’s capital stock and permanent surplus, without the permission of the Commission, which limit on investment shall not include, but shall be in addition to, investment in (i) a real estate subsidiary as provided in § 6.2-873, (ii) the stock, securities, or obligations of a building corporation under § 6.2-870, and (iii) controlled subsidiary corporations that are wholly owned by the bank.C\n\nA controlled subsidiary corporation shall not be authorized to (i) receive deposits except as hereafter provided; (ii) engage in the trust business; or (iii) conduct any business that is required under § 13.1-620 to be specifically stated in the articles of incorporation, except a controlled subsidiary corporation may engage in the business of credit card operations, leasing, safe deposit, factoring, credit bureaus, mortgage brokerage or servicing, data processing, international banking and finance, and any other function or business activity in which a bank might engage, except the receipt of deposits, or the trust business. Subject to the foregoing limitations on the businesses that a controlled subsidiary corporation is authorized to conduct, and with the prior approval of the Commission and subject to such conditions as the Commission may impose, a controlled subsidiary corporation may also engage in any business that is authorized by statute, regulation, or official interpretation for a subsidiary of a national bank or an out-of-state state bank as defined in § 6.2-836 to the extent such activity is financial in nature, or incidental or complimentary to a financial activity, and is not otherwise prohibited by state law. A controlled subsidiary corporation transacting business as a real estate brokerage firm shall be governed by § 6.2-888 and be subject to the provisions of this section. A controlled subsidiary corporation may charge and collect such finance charges and fees or interest rates as are authorized to banks by the laws of the Commonwealth or as otherwise authorized by Chapter 3 (§ 6.2-300 et seq.).D\n\nA controlled subsidiary corporation engaged solely in the business of international banking and finance, and subject to the regulation and supervision by the Board of Governors of the Federal Reserve System, shall not be prohibited from receiving deposits or from taking any other action that any such regulated international banking and finance institution is permitted to take.E\n\nThe provisions of § 6.2-874 relating to investment of funds in shares of stock of another corporation shall be applicable to controlled subsidiary corporations, except that a controlled subsidiary corporation may acquire, own, and hold stock in a subsidiary corporation if a bank would be permitted to directly acquire, own, or hold the stock hereunder. The provisions of § 6.2-876 relating to loans to officers, directors, or employees of the bank shall be applicable both to loans by the subsidiary to officers, directors, or employees of the bank and to loans by the bank to officers, directors, or employees of the subsidiary, with the approval of the board of directors of the bank only being required for purposes of § 6.2-876. The limitations of §§ 6.2-878 through 6.2-881 as they relate to appraisal value, maximum term, and amortization on loans secured by real estate shall be applicable to controlled subsidiary corporations. Notwithstanding any provisions of this subsection to the contrary, the restrictions set out in §§ 6.2-874 through 6.2-881 shall not be imposed upon any controlled subsidiary that has no state banks as shareholders.F\n\nThe provisions of § 6.2-875 relating to limitations upon obligations of any one borrower shall apply to the total obligations of any borrower in the aggregate to the subsidiary corporation and to any bank or bank holding company owning stock securities or obligations of such subsidiary corporation. The loan limit of the subsidiary shall be computed by attributing to the subsidiary a pro rata share of the lending limit of each bank stockholder prorated in accordance with the percentage of stock owned by such bank. However, in the case of a subsidiary, any of the stock, securities, or other obligations of which are owned by a bank holding company, the loan limits of the subsidiary shall be computed by attributing to the subsidiary a pro rata share of the lending limits of all bank subsidiaries of such holding company, which share shall be prorated based on the percentage of stock owned by the holding company and all subsidiary banks thereof. In computing whether a bank or a subsidiary that is not wholly owned is complying with its lending limit, the loans of the bank and the subsidiary to any common borrower shall be aggregated on a basis pro rata to the percentage of stock of the subsidiary owned by the bank. Such controlled subsidiary corporation shall not otherwise be subject to the provisions of this chapter except where it is expressly so provided. Notwithstanding any provisions of this subsection to the contrary, the restrictions set out in §§ 6.2-874 through 6.2-881 shall not be imposed upon any controlled subsidiary that has no state banks as shareholders.","order_by":null,"text":{"0":{"id":234863,"text":"As used in this section and §§ 6.2-886, 6.2-887, and 6.2-888:\n\t\t\t“Control” has the meaning assigned to it in § 2 of the Bank Holding Company Act of 1956 (12 U.S.C. § 1841 et seq.).\n\t\t\t“Controlled subsidiary corporation” means a corporation that is controlled by a bank organized under the laws of the Commonwealth, or by more than one bank, at least one of which is organized under the laws of the Commonwealth.","type":"section","prefixes":["A"],"prefix":"A","entire_prefix":"A","prefix_anchor":"A","level":1,"next_prefix":"B"},"1":{"id":234864,"text":"A bank may acquire, own, and hold the stock, securities, or obligations of one or more controlled subsidiary corporations. Such investment in stock, securities, or obligations, together with any investment of the bank in stock, securities, or obligations of a bank service corporation, shall not exceed in the aggregate 50 percent of the bank’s capital stock and permanent surplus, without the permission of the Commission, which limit on investment shall not include, but shall be in addition to, investment in (i) a real estate subsidiary as provided in § 6.2-873, (ii) the stock, securities, or obligations of a building corporation under § 6.2-870, and (iii) controlled subsidiary corporations that are wholly owned by the bank.","type":"section","prefixes":["B"],"prefix":"B","entire_prefix":"B","prefix_anchor":"B","level":1,"prior_prefix":"A","next_prefix":"C"},"2":{"id":234865,"text":"A controlled subsidiary corporation shall not be authorized to (i) receive deposits except as hereafter provided; (ii) engage in the trust business; or (iii) conduct any business that is required under § 13.1-620 to be specifically stated in the articles of incorporation, except a controlled subsidiary corporation may engage in the business of credit card operations, leasing, safe deposit, factoring, credit bureaus, mortgage brokerage or servicing, data processing, international banking and finance, and any other function or business activity in which a bank might engage, except the receipt of deposits, or the trust business. Subject to the foregoing limitations on the businesses that a controlled subsidiary corporation is authorized to conduct, and with the prior approval of the Commission and subject to such conditions as the Commission may impose, a controlled subsidiary corporation may also engage in any business that is authorized by statute, regulation, or official interpretation for a subsidiary of a national bank or an out-of-state state bank as defined in § 6.2-836 to the extent such activity is financial in nature, or incidental or complimentary to a financial activity, and is not otherwise prohibited by state law. A controlled subsidiary corporation transacting business as a real estate brokerage firm shall be governed by § 6.2-888 and be subject to the provisions of this section. A controlled subsidiary corporation may charge and collect such finance charges and fees or interest rates as are authorized to banks by the laws of the Commonwealth or as otherwise authorized by Chapter 3 (§ 6.2-300 et seq.).","type":"section","prefixes":["C"],"prefix":"C","entire_prefix":"C","prefix_anchor":"C","level":1,"prior_prefix":"B","next_prefix":"D"},"3":{"id":234866,"text":"A controlled subsidiary corporation engaged solely in the business of international banking and finance, and subject to the regulation and supervision by the Board of Governors of the Federal Reserve System, shall not be prohibited from receiving deposits or from taking any other action that any such regulated international banking and finance institution is permitted to take.","type":"section","prefixes":["D"],"prefix":"D","entire_prefix":"D","prefix_anchor":"D","level":1,"prior_prefix":"C","next_prefix":"E"},"4":{"id":234867,"text":"The provisions of § 6.2-874 relating to investment of funds in shares of stock of another corporation shall be applicable to controlled subsidiary corporations, except that a controlled subsidiary corporation may acquire, own, and hold stock in a subsidiary corporation if a bank would be permitted to directly acquire, own, or hold the stock hereunder. The provisions of § 6.2-876 relating to loans to officers, directors, or employees of the bank shall be applicable both to loans by the subsidiary to officers, directors, or employees of the bank and to loans by the bank to officers, directors, or employees of the subsidiary, with the approval of the board of directors of the bank only being required for purposes of § 6.2-876. The limitations of §§ 6.2-878 through 6.2-881 as they relate to appraisal value, maximum term, and amortization on loans secured by real estate shall be applicable to controlled subsidiary corporations. Notwithstanding any provisions of this subsection to the contrary, the restrictions set out in §§ 6.2-874 through 6.2-881 shall not be imposed upon any controlled subsidiary that has no state banks as shareholders.","type":"section","prefixes":["E"],"prefix":"E","entire_prefix":"E","prefix_anchor":"E","level":1,"prior_prefix":"D","next_prefix":"F"},"5":{"id":234868,"text":"The provisions of § 6.2-875 relating to limitations upon obligations of any one borrower shall apply to the total obligations of any borrower in the aggregate to the subsidiary corporation and to any bank or bank holding company owning stock securities or obligations of such subsidiary corporation. The loan limit of the subsidiary shall be computed by attributing to the subsidiary a pro rata share of the lending limit of each bank stockholder prorated in accordance with the percentage of stock owned by such bank. However, in the case of a subsidiary, any of the stock, securities, or other obligations of which are owned by a bank holding company, the loan limits of the subsidiary shall be computed by attributing to the subsidiary a pro rata share of the lending limits of all bank subsidiaries of such holding company, which share shall be prorated based on the percentage of stock owned by the holding company and all subsidiary banks thereof. In computing whether a bank or a subsidiary that is not wholly owned is complying with its lending limit, the loans of the bank and the subsidiary to any common borrower shall be aggregated on a basis pro rata to the percentage of stock of the subsidiary owned by the bank. Such controlled subsidiary corporation shall not otherwise be subject to the provisions of this chapter except where it is expressly so provided. Notwithstanding any provisions of this subsection to the contrary, the restrictions set out in §§ 6.2-874 through 6.2-881 shall not be imposed upon any controlled subsidiary that has no state banks as shareholders.","type":"section","prefixes":["F"],"prefix":"F","entire_prefix":"F","prefix_anchor":"F","level":1,"prior_prefix":"E"}},"ancestry":[{"id":14189,"edition_id":1,"name":"Investments and Loans","identifier":"9","label":"article","depth":4,"order_by":1,"parent_id":13791,"metadata":{},"date_created":"2026-06-26 03:47:11","date_modified":"2026-06-26 03:47:11","permalink":{"id":265643,"object_type":"structure","relational_id":14189,"identifier":"9","token":"6.2\/II\/8\/9","url":"\/6.2\/II\/8\/9\/","edition_id":1,"permalink":0,"preferred":1}},{"id":13791,"edition_id":1,"name":"Banks","identifier":"8","label":"chapter","depth":3,"order_by":1,"parent_id":13000,"metadata":{},"date_created":"2026-06-26 03:45:53","date_modified":"2026-06-26 03:45:53","permalink":{"id":265065,"object_type":"structure","relational_id":13791,"identifier":"8","token":"6.2\/II\/8","url":"\/6.2\/II\/8\/","edition_id":1,"permalink":0,"preferred":1}},{"id":13000,"edition_id":1,"name":"Depository Institutions and Trust Organizations","identifier":"II","label":"subtitle","depth":2,"order_by":1,"parent_id":12852,"metadata":{},"date_created":"2026-06-26 03:44:07","date_modified":"2026-06-26 03:44:07","permalink":{"id":263685,"object_type":"structure","relational_id":13000,"identifier":"II","token":"6.2\/II","url":"\/6.2\/II\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12852,"edition_id":1,"name":"Financial Institutions and Services","identifier":"6.2","label":"title","depth":1,"order_by":1,"parent_id":null,"metadata":{},"date_created":"2026-06-26 03:43:56","date_modified":"2026-06-26 03:43:56","permalink":{"id":263249,"object_type":"structure","relational_id":12852,"identifier":"6.2","token":"6.2","url":"\/6.2\/","edition_id":1,"permalink":0,"preferred":1}}],"structure_contents":[{"id":63411,"structure_id":14189,"section_number":"6.2-870","catch_line":"Limitation of amount invested in bank premises","url":"\/6.2-870\/","token":"6.2\/II\/8\/9\/6.2-870","metadata":false},{"id":64130,"structure_id":14189,"section_number":"6.2-871","catch_line":"Investment in stock or securities of bank service corporations","url":"\/6.2-871\/","token":"6.2\/II\/8\/9\/6.2-871","metadata":false},{"id":61248,"structure_id":14189,"section_number":"6.2-872","catch_line":"For what purpose banks may purchase, hold, and convey real estate","url":"\/6.2-872\/","token":"6.2\/II\/8\/9\/6.2-872","metadata":false},{"id":74353,"structure_id":14189,"section_number":"6.2-873","catch_line":"Additional permissible investments in real estate","url":"\/6.2-873\/","token":"6.2\/II\/8\/9\/6.2-873","metadata":false},{"id":82541,"structure_id":14189,"section_number":"6.2-874","catch_line":"Prohibited uses of bank's own stock; other investments or loans","url":"\/6.2-874\/","token":"6.2\/II\/8\/9\/6.2-874","metadata":false},{"id":57173,"structure_id":14189,"section_number":"6.2-875","catch_line":"Limitations on obligations of borrowers","url":"\/6.2-875\/","token":"6.2\/II\/8\/9\/6.2-875","metadata":false},{"id":55367,"structure_id":14189,"section_number":"6.2-876","catch_line":"Loans to executive officers or directors","url":"\/6.2-876\/","token":"6.2\/II\/8\/9\/6.2-876","metadata":false},{"id":85468,"structure_id":14189,"section_number":"6.2-877","catch_line":"Overdrafts by bank officer or director","url":"\/6.2-877\/","token":"6.2\/II\/8\/9\/6.2-877","metadata":false},{"id":76996,"structure_id":14189,"section_number":"6.2-878","catch_line":"Loans secured by real estate generally","url":"\/6.2-878\/","token":"6.2\/II\/8\/9\/6.2-878","metadata":false},{"id":80117,"structure_id":14189,"section_number":"6.2-879","catch_line":"Certain loans not considered loans secured by real estate","url":"\/6.2-879\/","token":"6.2\/II\/8\/9\/6.2-879","metadata":false},{"id":59260,"structure_id":14189,"section_number":"6.2-880","catch_line":"Construction loans","url":"\/6.2-880\/","token":"6.2\/II\/8\/9\/6.2-880","metadata":false},{"id":78478,"structure_id":14189,"section_number":"6.2-881","catch_line":"Investment in reverse annuity mortgages","url":"\/6.2-881\/","token":"6.2\/II\/8\/9\/6.2-881","metadata":false},{"id":60973,"structure_id":14189,"section_number":"6.2-882","catch_line":"Bank borrowing money or rediscounting its notes","url":"\/6.2-882\/","token":"6.2\/II\/8\/9\/6.2-882","metadata":false},{"id":87132,"structure_id":14189,"section_number":"6.2-883","catch_line":"Acceptance of drafts or bills of exchange; issuance of letters of credit","url":"\/6.2-883\/","token":"6.2\/II\/8\/9\/6.2-883","metadata":false},{"id":76682,"structure_id":14189,"section_number":"6.2-884","catch_line":"Ownership and lease of personal property","url":"\/6.2-884\/","token":"6.2\/II\/8\/9\/6.2-884","metadata":false},{"id":64536,"structure_id":14189,"section_number":"6.2-885","catch_line":"Investment in stock or securities of controlled subsidiary corporations","url":"\/6.2-885\/","token":"6.2\/II\/8\/9\/6.2-885","metadata":false},{"id":74671,"structure_id":14189,"section_number":"6.2-886","catch_line":"Regulation of controlled subsidiary corporations by Commission","url":"\/6.2-886\/","token":"6.2\/II\/8\/9\/6.2-886","metadata":false},{"id":73096,"structure_id":14189,"section_number":"6.2-887","catch_line":"Insurance business of controlled subsidiary","url":"\/6.2-887\/","token":"6.2\/II\/8\/9\/6.2-887","metadata":false},{"id":69740,"structure_id":14189,"section_number":"6.2-888","catch_line":"Real estate brokerage business of controlled subsidiary","url":"\/6.2-888\/","token":"6.2\/II\/8\/9\/6.2-888","metadata":false}],"previous_section":{"id":76682,"structure_id":14189,"section_number":"6.2-884","catch_line":"Ownership and lease of personal property","url":"\/6.2-884\/","token":"6.2\/II\/8\/9\/6.2-884","metadata":false},"next_section":{"id":74671,"structure_id":14189,"section_number":"6.2-886","catch_line":"Regulation of controlled subsidiary corporations by Commission","url":"\/6.2-886\/","token":"6.2\/II\/8\/9\/6.2-886","metadata":false},"metadata":false,"official_url":"https:\/\/law.lis.virginia.gov\/vacode\/6.2-885\/","history_text":"

This law was first created in 1968. The record of its establishment is cataloged in chapter 270 of that year\u2019s edition of \u201cActs of Assembly,\u201d the annual state publication listing all changes made to the Code of Virginia in that year. Unfortunately, the 1968 \u201cActs\u201d aren\u2019t available online. It has been modified 8 times. Those modifications are cataloged by \u201cThe Acts of Assembly,\u201d a state publication, by year and chapter. Those modifications that can be read on the General Assembly\u2019s website will be linked accordingly. Those modifications are as follows: in 1978, chapter 797; in 1988, chapter 296; in 1993, chapter 64; in 1997, chapter 277<\/a>; in 1999, chapter 60<\/a>; in 2001, chapter 508<\/a>; in 2003, chapters 536<\/a> and 558<\/a>; in 2010, chapter 794<\/a>.<\/p>","references":[{"id":65808,"section_number":"6.2-1146","catch_line":"State association or association holding company acquiring bank; association acquired by bank or bank holding company; merger or consolidation of association and bank","order_by":null,"url":"\/6.2-1146\/"},{"id":78611,"section_number":"6.2-814","catch_line":"Powers of banks","order_by":null,"url":"\/6.2-814\/"},{"id":74353,"section_number":"6.2-873","catch_line":"Additional permissible investments in real estate","order_by":null,"url":"\/6.2-873\/"},{"id":82541,"section_number":"6.2-874","catch_line":"Prohibited uses of bank's own stock; other investments or loans","order_by":null,"url":"\/6.2-874\/"},{"id":73096,"section_number":"6.2-887","catch_line":"Insurance business of controlled subsidiary","order_by":null,"url":"\/6.2-887\/"},{"id":69740,"section_number":"6.2-888","catch_line":"Real estate brokerage business of controlled subsidiary","order_by":null,"url":"\/6.2-888\/"}],"refers_to":[{"id":63023,"section_number":"13.1-620","catch_line":"Special kinds of business","order_by":null,"url":"\/13.1-620\/"},{"id":61230,"section_number":"6.2-300","catch_line":"Definitions","order_by":null,"url":"\/6.2-300\/"},{"id":58856,"section_number":"6.2-836","catch_line":"Definitions","order_by":null,"url":"\/6.2-836\/"},{"id":63411,"section_number":"6.2-870","catch_line":"Limitation of amount invested in bank premises","order_by":null,"url":"\/6.2-870\/"},{"id":74353,"section_number":"6.2-873","catch_line":"Additional permissible investments in real estate","order_by":null,"url":"\/6.2-873\/"},{"id":82541,"section_number":"6.2-874","catch_line":"Prohibited uses of bank's own stock; other investments or loans","order_by":null,"url":"\/6.2-874\/"},{"id":57173,"section_number":"6.2-875","catch_line":"Limitations on obligations of borrowers","order_by":null,"url":"\/6.2-875\/"},{"id":55367,"section_number":"6.2-876","catch_line":"Loans to executive officers or directors","order_by":null,"url":"\/6.2-876\/"},{"id":76996,"section_number":"6.2-878","catch_line":"Loans secured by real estate generally","order_by":null,"url":"\/6.2-878\/"},{"id":78478,"section_number":"6.2-881","catch_line":"Investment in reverse annuity mortgages","order_by":null,"url":"\/6.2-881\/"},{"id":74671,"section_number":"6.2-886","catch_line":"Regulation of controlled subsidiary corporations by Commission","order_by":null,"url":"\/6.2-886\/"},{"id":73096,"section_number":"6.2-887","catch_line":"Insurance business of controlled subsidiary","order_by":null,"url":"\/6.2-887\/"},{"id":69740,"section_number":"6.2-888","catch_line":"Real estate brokerage business of controlled subsidiary","order_by":null,"url":"\/6.2-888\/"}],"permalink":{"id":265705,"object_type":"law","relational_id":64536,"identifier":"6.2-885","token":"6.2\/II\/8\/9\/6.2-885","url":"\/6.2-885\/","edition_id":1,"permalink":0,"preferred":1},"url":"\/6.2-885\/","token":"6.2\/II\/8\/9\/6.2-885","dublin_core":{"Title":"Investment in stock or securities of controlled subsidiary corporations","Type":"Text","Format":"text\/html","Identifier":"\u00a7 6.2-885","Relation":"Code of Virginia"},"html":"\n\t\t\t\t\t\t

A.<\/span> As used in this section and §§ 6.2-886<\/a>, 6.2-887<\/a>, and 6.2-888<\/a>:\n\t\t\t“Control” has the meaning assigned to it in § 2 of the Bank Holding Company<\/span> Act of 1956 (12 U.S.C. § 1841 et seq.).\n\t\t\t“Controlled subsidiary corporation<\/span>” means a corporation that is controlled by a bank organized under the laws<\/span> of the Commonwealth, or by more than one bank, at least one of which is organized under the laws<\/span> of the Commonwealth. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

B.<\/span> A bank may acquire, own, and hold the stock, securities, or obligations of one or more controlled subsidiary corporations<\/span>. Such investment in stock, securities, or obligations, together with any investment of the bank in stock, securities, or obligations of a bank service corporation, shall not exceed in the aggregate 50 percent of the bank’s capital stock and permanent surplus, without the permission of the Commission<\/span>, which limit on investment shall not include, but shall be in addition to, investment in (i) a real estate subsidiary as provided in § 6.2-873<\/a>, (ii) the stock, securities, or obligations of a building corporation under § 6.2-870<\/a>, and (iii) controlled subsidiary corporations<\/span> that are wholly owned by the bank. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

C.<\/span> A controlled subsidiary corporation<\/span> shall not be authorized to (i) receive deposits except as hereafter provided; (ii) engage in the trust business; or (iii) conduct any business that is required under § 13.1-620<\/a> to be specifically stated in the articles of incorporation, except a controlled subsidiary corporation<\/span> may engage in the business of credit card operations, leasing, safe deposit, factoring, credit bureaus<\/span>, mortgage brokerage or servicing, data processing, international banking and finance, and any other function or business activity in which a bank might engage, except the receipt of deposits, or the trust business. Subject to the foregoing limitations on the businesses that a controlled subsidiary corporation<\/span> is authorized to conduct, and with the prior approval of the Commission<\/span> and subject to such conditions as the Commission<\/span> may impose, a controlled subsidiary corporation<\/span> may also engage in any business that is authorized by statute<\/span>, regulation, or official interpretation for a subsidiary of a national bank or an out-of-state state bank<\/span> as defined in § 6.2-836<\/a> to the extent such activity is financial in nature, or incidental or complimentary to a financial activity, and is not otherwise prohibited by state law<\/span>. A controlled subsidiary corporation<\/span> transacting business as a real estate brokerage firm shall be governed by § 6.2-888<\/a> and be subject to the provisions of this section. A controlled subsidiary corporation<\/span> may charge and collect such finance charges and fees or interest rates as are authorized to banks<\/span> by the laws<\/span> of the Commonwealth or as otherwise authorized by Chapter 3 (§ 6.2-300<\/a> et seq.). <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

D.<\/span> A controlled subsidiary corporation<\/span> engaged solely in the business of international banking and finance, and subject to the regulation and supervision by the Board of Governors of the Federal Reserve System, shall not be prohibited from receiving deposits or from taking any other action that any such regulated international banking and finance institution is permitted to take. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

E.<\/span> The provisions of § 6.2-874<\/a> relating to investment of funds in shares of stock of another corporation shall be applicable to controlled subsidiary corporations<\/span>, except that a controlled subsidiary corporation<\/span> may acquire, own, and hold stock in a subsidiary corporation if a bank would be permitted to directly acquire, own, or hold the stock hereunder. The provisions of § 6.2-876<\/a> relating to loans to officers, directors, or employees of the bank shall be applicable both to loans by the subsidiary to officers, directors, or employees of the bank and to loans by the bank to officers, directors, or employees of the subsidiary, with the approval of the board of directors of the bank only being required for purposes of § 6.2-876<\/a>. The limitations of §§ 6.2-878<\/a> through 6.2-881<\/a> as they relate to appraisal value, maximum term, and amortization on loans secured by real estate shall be applicable to controlled subsidiary corporations<\/span>. Notwithstanding any provisions of this subsection to the contrary, the restrictions set out in §§ 6.2-874<\/a> through 6.2-881<\/a> shall not be imposed upon any controlled subsidiary that has no state banks<\/span> as shareholders. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

F.<\/span> The provisions of § 6.2-875<\/a> relating to limitations upon obligations of any one borrower shall apply to the total obligations of any borrower in the aggregate to the subsidiary corporation and to any bank or bank holding company<\/span> owning stock securities or obligations of such subsidiary corporation. The loan limit of the subsidiary shall be computed by attributing to the subsidiary a pro rata share of the lending limit of each bank stockholder prorated in accordance with the percentage of stock owned by such bank. However, in the case of a subsidiary, any of the stock, securities, or other obligations of which are owned by a bank holding company<\/span>, the loan limits of the subsidiary shall be computed by attributing to the subsidiary a pro rata share of the lending limits of all bank subsidiaries of such holding company, which share shall be prorated based on the percentage of stock owned by the holding company and all subsidiary banks thereof. In computing whether a bank or a subsidiary that is not wholly owned is complying with its lending limit, the loans of the bank and the subsidiary to any common borrower shall be aggregated on a basis pro rata to the percentage of stock of the subsidiary owned by the bank. Such controlled subsidiary corporation<\/span> shall not otherwise be subject to the provisions of this chapter except where it is expressly so provided. Notwithstanding any provisions of this subsection to the contrary, the restrictions set out in §§ 6.2-874<\/a> through 6.2-881<\/a> shall not be imposed upon any controlled subsidiary that has no state banks<\/span> as shareholders. <\/i><\/a><\/p><\/section>","plain_text":" CODE OF VIRGINIA\n\nINVESTMENT IN STOCK OR SECURITIES OF CONTROLLED SUBSIDIARY CORPORATIONS (\u00a7\n6.2-885)\n\nA. As used in this section and §§ 6.2-886, 6.2-887, and 6.2-888:\n\t\t\t“Control” has the meaning assigned to it in § 2 of the Bank\nHolding Company Act of 1956 (12 U.S.C. § 1841 et seq.).\n\t\t\t“Controlled subsidiary corporation” means a corporation that is\ncontrolled by a bank organized under the laws of the Commonwealth, or by more\nthan one bank, at least one of which is organized under the laws of the\nCommonwealth.\n\nB. A bank may acquire, own, and hold the stock, securities, or obligations of\none or more controlled subsidiary corporations. Such investment in stock,\nsecurities, or obligations, together with any investment of the bank in stock,\nsecurities, or obligations of a bank service corporation, shall not exceed in\nthe aggregate 50 percent of the bank’s capital stock and permanent\nsurplus, without the permission of the Commission, which limit on investment\nshall not include, but shall be in addition to, investment in (i) a real estate\nsubsidiary as provided in § 6.2-873, (ii) the stock, securities, or\nobligations of a building corporation under § 6.2-870, and (iii) controlled\nsubsidiary corporations that are wholly owned by the bank.\n\nC. A controlled subsidiary corporation shall not be authorized to (i) receive\ndeposits except as hereafter provided; (ii) engage in the trust business; or\n(iii) conduct any business that is required under § 13.1-620 to be\nspecifically stated in the articles of incorporation, except a controlled\nsubsidiary corporation may engage in the business of credit card operations,\nleasing, safe deposit, factoring, credit bureaus, mortgage brokerage or\nservicing, data processing, international banking and finance, and any other\nfunction or business activity in which a bank might engage, except the receipt\nof deposits, or the trust business. Subject to the foregoing limitations on the\nbusinesses that a controlled subsidiary corporation is authorized to conduct,\nand with the prior approval of the Commission and subject to such conditions as\nthe Commission may impose, a controlled subsidiary corporation may also engage\nin any business that is authorized by statute, regulation, or official\ninterpretation for a subsidiary of a national bank or an out-of-state state bank\nas defined in § 6.2-836 to the extent such activity is financial in nature,\nor incidental or complimentary to a financial activity, and is not otherwise\nprohibited by state law. A controlled subsidiary corporation transacting\nbusiness as a real estate brokerage firm shall be governed by § 6.2-888 and\nbe subject to the provisions of this section. A controlled subsidiary\ncorporation may charge and collect such finance charges and fees or interest\nrates as are authorized to banks by the laws of the Commonwealth or as otherwise\nauthorized by Chapter 3 (§ 6.2-300 et seq.).\n\nD. A controlled subsidiary corporation engaged solely in the business of\ninternational banking and finance, and subject to the regulation and supervision\nby the Board of Governors of the Federal Reserve System, shall not be prohibited\nfrom receiving deposits or from taking any other action that any such regulated\ninternational banking and finance institution is permitted to take.\n\nE. The provisions of § 6.2-874 relating to investment of funds in shares of\nstock of another corporation shall be applicable to controlled subsidiary\ncorporations, except that a controlled subsidiary corporation may acquire, own,\nand hold stock in a subsidiary corporation if a bank would be permitted to\ndirectly acquire, own, or hold the stock hereunder. The provisions of §\n6.2-876 relating to loans to officers, directors, or employees of the bank shall\nbe applicable both to loans by the subsidiary to officers, directors, or\nemployees of the bank and to loans by the bank to officers, directors, or\nemployees of the subsidiary, with the approval of the board of directors of the\nbank only being required for purposes of § 6.2-876. The limitations of\n§§ 6.2-878 through 6.2-881 as they relate to appraisal value, maximum\nterm, and amortization on loans secured by real estate shall be applicable to\ncontrolled subsidiary corporations. Notwithstanding any provisions of this\nsubsection to the contrary, the restrictions set out in §§ 6.2-874\nthrough 6.2-881 shall not be imposed upon any controlled subsidiary that has no\nstate banks as shareholders.\n\nF. The provisions of § 6.2-875 relating to limitations upon obligations of\nany one borrower shall apply to the total obligations of any borrower in the\naggregate to the subsidiary corporation and to any bank or bank holding company\nowning stock securities or obligations of such subsidiary corporation. The loan\nlimit of the subsidiary shall be computed by attributing to the subsidiary a pro\nrata share of the lending limit of each bank stockholder prorated in accordance\nwith the percentage of stock owned by such bank. However, in the case of a\nsubsidiary, any of the stock, securities, or other obligations of which are\nowned by a bank holding company, the loan limits of the subsidiary shall be\ncomputed by attributing to the subsidiary a pro rata share of the lending limits\nof all bank subsidiaries of such holding company, which share shall be prorated\nbased on the percentage of stock owned by the holding company and all subsidiary\nbanks thereof. In computing whether a bank or a subsidiary that is not wholly\nowned is complying with its lending limit, the loans of the bank and the\nsubsidiary to any common borrower shall be aggregated on a basis pro rata to the\npercentage of stock of the subsidiary owned by the bank. Such controlled\nsubsidiary corporation shall not otherwise be subject to the provisions of this\nchapter except where it is expressly so provided. Notwithstanding any provisions\nof this subsection to the contrary, the restrictions set out in §§\n6.2-874 through 6.2-881 shall not be imposed upon any controlled subsidiary that\nhas no state banks as shareholders.\n\nHISTORY: 1968, c. 270, \u00a7 6.1-58.1; 1978, c. 797; 1988, c. 296; 1993, c. 64;\n1997, c. 277; 1999, c. 60; 2001, c. 508; 2003, cc. 536, 558; 2010, c. 794.","edition":{"id":1,"name":"2025","slug":"2025","date_created":"2026-06-21 22:39:22","date_modified":"2026-06-21 22:39:22","current":1,"order_by":1,"last_import":null}}