Maryland's banking commissioner has approved First National Bank of Maryland's application to convert to a state banking charter, the Division of Financial Regulation said yesterday.
The decision will bring in about $1.2 million in annual fees to the state, and nearly double the amount of assets overseen by the agency.
"They are in good financial condition, and they are well capitalized," said Anthony H. Zelaznicki, the state's assistant banking commissioner, who was instrumental in the decision. "The same thing for the parent."
The state oversees 67 banks with about $18 billion in assets; First National and its sister operations have $17.3 billion in assets.
First National is expected to receive its new charter tomorrow, and once that happens, it will be regulated by the state and the Federal Reserve Bank of Richmond. Now, it is regulated by the Office of the Comptroller of the Currency.
First Maryland Bancorp, First National's parent, is waiting for approval of its application to become a member of the Federal Reserve System, which regulates bank holding companies.
The conversion will allow First Maryland to fold all of its banks under a single name and corporate umbrella, which it plans to change early next year. In addition to operating First National, First Maryland operates the York Bank, First Omni Bank and Dauphin Deposit Bank & Trust Co.
The conversion will also help the bank save about $600,000 annually in examination fees since state fees are less than those charged by the federal government, company executives said.
First Maryland officials also believe the state regulators understand the local business climate better than the national examiners.
"They understand the market, they understand the environment JTC we operate in," said Reese Nank, a First National spokeswoman.
Zelaznicki said he spent about eight days reviewing financials and examination reports of First National, its parent, and Allied Irish Banks PLC, the Dublin-based parent company of First Maryland Bancorp, before passing his recommendation to Maryland Banking Commissioner H. Robert Hergenroeder.
Pub Date: 12/30/98