Identify yourself by name and address the members of the original board of directors. Keep in mind that state and federal banking regulations impose requirements and restrictions on a bank‘s board members, mandates that are separate and distinct from the founding articles of association. Obtain a form of status from the Secretary of State in the jurisdiction in which the bank will operate. Enter the suggested name of the bank at the top of the form. Make sure in advance that the name is available and not already in use. Check availability by using the search tool on the agency‘s website or by calling the company‘s department and asking an employee to confirm availability. Specify the specific purpose for which the company is organized. Unlike many other companies that allow a broad letter of intent, a banking company must have a specifically defined purpose. The object statement reads: “The Company shall be formed to conduct transactions authorized by banks under federal law and the laws of that state.” Bank of America, N.A., Merrill, its affiliates and consultants do not provide legal, tax or accounting advice. Consult your own legal and/or tax advisors before making financial decisions.
All backgrounders provided are provided for discussion or review purposes only. Small Business Resources content (including, but not limited to, third party content and Bank of America) is provided “as is” and contains no express or implied warranties, promises or warranties of success. Bank of America makes no warranties as to the accuracy, reliability, completeness, usefulness, non-infringement of intellectual property rights or quality of any content, regardless of the producer of such content, and opposes it to the fullest extent permitted by law. Among the many challenges facing the new Eurosystem – the European Central Bank and the central banks of the eleven members of the European Monetary Union – is the possibility that participating countries will react differently to changes in interest rates. This paper provides evidence that differences in financial structure are the direct cause of these national asymmetries in the transmission of monetary policy and that these differences in the financial structure are due to differences in the legal structure. The author concludes that the financial structures and monetary transmission mechanisms of the countries of the European Union will remain diverse if the legal structures are not harmonized throughout Europe. Name the agent for process delivery. The representative for the service of the procedure is the natural or legal person designated by the Company to accept the service of a subpoena and a request in case of prosecution of the Bank. The agent for the delivery of the process must maintain a physical address in the state of incorporation. Companies have a predictable management structure and company shares are generally easier to transfer than ownership shares in LLCs. For this reason, external investors tend to prefer to invest in companies. You form a corporation by submitting documents to your state.
Once created, a company is its own legal entity, separate from its owners. If the company is unable to pay its debts, creditors can search for bank accounts and company assets. But they cannot sue the owners‘ personal property (as long as the owners are not accused of misconduct). Your choice of business structure can affect everything from the amount you pay in taxes to your ability to raise funds to your personal exposure if the company goes bankrupt. Before making a final decision, discuss your options with an experienced accountant and business lawyer. In addition to recommending the best legal structure, a lawyer can help you start a business and the documents and contracts you need to get started on the right foot. Choosing the right legal structure for your business can protect your personal property if your business is sued. It can also save you money on your taxes and help you attract investors. Setting up a bank is a complicated regulatory and legal issue. One element associated with the creation of a bank is the creation of the legal entity itself. As a rule, a bank is a business. The process of setting up a bank is not much different from that associated with forming another type of for-profit corporation.
Despite some minor differences, the process of setting up a bank is largely the same in every state in the country, according to “Corporations: Examples & Explanations” by Alan R. Palmiter. Submit the form online or to the Office of the Secretary of State. Pay the registration fee at the same time. Filing the law and paying fees completes the process of setting up a bank. Enter the bank‘s primary address in the field provided. As a rule, a newly founded bank does not have branches. In some states, a business founded by licensed professionals may be called a “professional corporation” or “professional services corporation” to distinguish it from other types of businesses. Company owners are called shareholders and enjoy several important advantages: Limited partnerships and limited partnerships Like a corporation, limited liability company or LLC, limits the liability of its owners for commercial debts. You form an LLC by filing documents with your state.
LLCs are a popular choice for small businesses because they benefit from the protection of a company‘s liability, but with more flexible management, tax and ownership options, and fewer record keeping and reporting requirements. If you own a sole proprietorship or partnership, you are fully responsible for all debts of the business, even if that debt is due to something your business partner did. This means that a business believer might be looking for your personal money, home, and other assets, as well as the money you have in the business. This liability risk is one of the reasons why you might consider forming a company or limited liability company, especially if you have business partners. A limited partnership differs from a partnership in that it has general partners and limited partners. A personally responsible partner is involved in the management of the company and must be fully responsible for all debts of the company. A limited partner cannot be involved in the management and liability is limited to the amount invested. Limited partnerships are common in commercial real estate and other industries where it is desirable to raise funds from passive investors. By default, a one-member LLC is taxed as a sole proprietorship and a multi-member LLC is taxed as a partnership. Owners who work in the business are considered self-employed and pay income and self-employment taxes on their share of the company‘s profits.
But an LLC can also file a form with the IRS that chooses to be taxed as a C company or an S company. Owners of an LLC taxed as an S company can be employees of the company, which can save money on self-employment taxes. If you are the sole owner of your business, you can operate as a sole proprietorship. If you own the business with others, it is automatically a general partnership. You do not need to submit documents to start a sole proprietorship or partnership. However, if your business operates under a name other than your own name (such as “Joe‘s Coffee” or “Intrepid Designs”), you may need to file documents with your state or region to create a fictitious company name, trade name, or dba. A limited liability company offers limited liability to some or all of the partners, but the details vary from state to state. Some states limit limited partnerships to certain professions. A limited liability company might be a good choice if you want limited liability but can‘t form an LLC. Let‘s look at some of the possible options for structuring your new business. The IRS treats sole proprietorships and partnerships as “ignored corporations.” This means that the company itself does not pay income tax.