2001-02-05                     House Journal                      Page 0237
was read the first time and referred to the Labor & Commerce                                        
Committee.                                                                                          
                                                                                                    
The following fiscal note(s) apply:                                                                 
                                                                                                    
1.  Zero, Dept. of Community & Economic Development                                                 
                                                                                                    
The Governor's transmittal letter dated February 2, 2001, appears                                   
below:                                                                                              
                                                                                                    
"Dear Speaker Porter:                                                                               
                                                                                                    
This bill I transmit today allows state financial institutions to compete                           
on equal terms with their federal counterparts by removing current                                  
restraints on the state's financial industry.  These changes are                                    
encouraged under the federal Gramm-Leach-Bliley Act which permits                                   
the combining of banking institutions with insurance and securities                                 
businesses.  Previous federal law prohibited this practice.                                         
                                                                                                    
This bill allows the Department of Community and Economic                                           
Development to grant state banks those powers enjoyed by national                                   
banks in a simplified, efficient process.                                                           
                                                                                                    
The bill is patterned after federal law, but offers greater protection to                           
depositor and consumer financial records.  The state would use the                                  
more stringent practice of asking depositors and consumers to choose                                
to allow specific disclosure of their records.  Conversely, federal law                             
and many other states allow disclosure unless the depositor or                                      
consumer specifically requests confidentiality.                                                     
                                                                                                    
The bill also clarifies and updates existing statutes, partly in response                           
to discussions with the financial industry.  For example, the bill allows                           
state banks to publish their financial reports in electronic form or in a                           
local newspaper, and simplifies the procedure by which state banks                                  
obtain authority to install off-premises automated teller machines.  The                            
bill also removes the statutory limitation on the interest rate and fees                            
state banks may charge on credit cards and grants credit unions the                                 
authority to issue credit cards.  These provisions will keep Alaska                                 
banks competitive with out-of-state banks.