Regulatory Alerts2005-07-25 | ISGC-2005-009-DOBAuthority to Merge Insurance Agency Subsidiary into Depository Institution
The Washington State Department of Financial Institutions issued an interpretive statement confirming that state-chartered depository institutions may merge insurance agency subsidiaries into the parent bank under the Gramm-Leach-Bliley Act. The regulator determined that federal law preempts various restrictive state statutes and regulations, thereby allowing banks to directly engage in insurance sales, solicitation, and cross-marketing activities. While federal preemption broadens these powers, the statement clarifies that Washington retains authority to enforce specific consumer protection measures regarding licensing, advertising, and the handling of customer information.
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