<html> <head> <title>Rule 20:07:16:04 Conduct and practices.</title> <META NAME="Keywords" Content="Administrative Rules 20:07:16:04"> <META NAME="Description" Content="Administrative Rules 20:07:16:04 Conduct and practices."> <meta name=Generator content="Microsoft Office HTML Filter 2.0"> <meta http-equiv=Content-Type content="text/html; charset=windows-1252"> <meta name=Originator content="Microsoft Word 10"> <style> <!-- --> </style> </head> <body lang=EN-US> <div> <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <b>20:07:16:04.&nbsp;&nbsp;Conduct and practices.</b> A bank subsidiary as defined in §&nbsp;20:07:16:01 shall at all times conduct its business and operations in a safe and sound manner, consistent with prudent business practices. A bank subsidiary shall also meet the following requirements:</p> <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (1)&nbsp;&nbsp;The subsidiary shall conduct business pursuant to independent policies and procedures designed to make known to the public that the subsidiary exists as an organization separate from the parent bank;</p> <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (2)&nbsp;&nbsp;The subsidiary shall maintain separate accounting procedures and corporate records that are open to examination by the division;</p> <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (3)&nbsp;&nbsp;The subsidiary shall observe separate corporate formalities.</p> <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <b>Source:</b> 12 SDR 106, effective January 1, 1986; 12 SDR 151, 12 SDR 155, effective July 1, 1986.</p> <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <b>General Authority:</b>SDCL <A HREF="/statutes/DisplayStatute.aspx?Type=Statute&Statute=51A-2-13">51A-2-13</A> to <A HREF="/statutes/DisplayStatute.aspx?Type=Statute&Statute=51A-2-15">51A-2-15.</A></p> <p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <b>Law Implemented:</b>SDCL <A HREF="/statutes/DisplayStatute.aspx?Type=Statute&Statute=51A-4-1">51A-4-1.</A></p> </div> </body> </html>