The state Department of Financial Services has appointed the CEO of the Bank of Akron and an M&T Bank executive in Rochester to a new nine-member board to advise the agency on how to promote the state-chartered banking system in New York.
Benjamin M. Lawsky, superintendent of financial services, named E. Peter Forrestel II, president and CEO of Bank of Akron in Erie County, and M&T Executive Vice President Brian E. Hickey of Pittsford to the new State Charter Advisory Board.
They will join seven others, including executives of banks with assets ranging from $3 billion to less than $500 million, from across the state. There is one representative from a credit union in Rome, one attorney, one from a foreign bank with a New York City office and one from a consumer group in New York City. Each of the board's members will serve for three years, without compensation.
The board was created last year through legislation that merged the former state banking and insurance departments to form the Department of Financial Services. It's responsible for helping the state retain existing state-chartered banks, encouraging federally chartered banks to switch, and promoting the state banking system.
As part of the nation's "dual-banking system," U.S. banks have the choice of being chartered under federal law or the authority of one of the states, each of which has its own charter and regulatory agency.
For the most part, the primary powers of the banks are similar under either system, with some exceptions depending on variations in state laws, so banks often make their choices based more on which regulator they want to oversee them. For the states or federal government, meanwhile, the choice is a matter of both pride and revenue, since the banks also pay annual fees to their regulatory agency, helping to fund budgets.
Currently, there are about 300 state-chartered banks in New York, with $2.1 trillion in assets. Two banks, in Queens and Elmira, recently converted from federal to state charters.
"This department is committed to developing a strong state-chartered banking system that enables banks to grow and create jobs for New Yorkers," Lawsky said. "The nine members of the new board have a wealth of professional experience. I am eager to draw on their expertise so we can build a flourishing state-chartered system."