Magazine article American Banker

Regional Interstate Zones Gain; New Jersey Law Signed; Thrifts in Midwest Push for Expansion

Magazine article American Banker

Regional Interstate Zones Gain; New Jersey Law Signed; Thrifts in Midwest Push for Expansion

Article excerpt

Regional Interstate Zones Gain

Regional Interstate banking compacts and the deals they have spawned were well represented in news last week from several areas around the country.

New Jersey became the latest player in the still-young mid-Atlantic region when Gov. Thomas H. Kean signed an interstate banking measure that gives banks in New Jersey reciprocity with those in 13 others states and the District of Columbia. Under the law, however, at least three states from the region must have reciprocal legislation before a compact takes effect.

Pennsylvania is expected to report into the game within a few months when its enacts a law of its own, and Ohio and Kentucky -- which already permit interstate banking -- are expected to join in a compact with New Jersey.

More Room for Thrifts

In the Midwest, where another regional compact has been building, thrifts are following in the footsteps of banks in the area by pushing for the right to expand on a regional basis. Encouraged by the success that savings and loans in Wisconsin had in getting regional laws passed, thrifts in a number of other Midwest states also have jumped on the regional bandwagon.

So far, lawmakers in Minnesota, Ohio, and Wisconsin already have given savings and loans the right to expand on a regional basis, and legislation has been or is expected to be introduced in Illinois, Michigan, and Missouri. Only two midwestern states -- Indiana and Iowa -- are not expected to consider the issue this year.

The thrifts may get a boost from Uncle Sam: Under a proposed rule change by the Federal Home Loan Bank Board, any regional legislation would apply to both state- and federally chartered thrifts.

Signals from New England

In New England, meanwhile, two state legislatures gave signals favorable to regional compacts.

A Connecticut legislative committee failed to report out a bill that would have allowed all but the 11 largest New York banks into the state, delaying for at least another year a foothold by New Yorkers in the Connecticut market. …

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