N.Y. Banking Law § 138: Foreign branches; performance of contracts and repayment of deposits

§ 138. Foreign branches; performance of contracts and repayment of

deposits. 1. Notwithstanding section 1--301 of the uniform commercial

code, any bank or trust company or national bank located in this state

which in accordance with the provisions of this chapter or otherwise

applicable law shall have opened and occupied a branch office or branch

offices in any foreign country shall be liable for contracts to be

performed at such branch office or offices and for deposits to be repaid

at such branch office or offices to no greater extent than a bank,

banking corporation or other organization or association for banking

purposes organized and existing under the laws of such foreign country

would be liable under its laws. The laws of such foreign country for the

purpose of this section shall be deemed to include all acts, decrees,

regulations and orders promulgated or enforced by a dominant authority

asserting governmental, military or police power of any kind at the

place where any such branch office is located, whether or not such

dominant authority be recognized as a de facto or de jure government.

2. Notwithstanding section 1--301 of the uniform commercial code, if

by action of any such dominant authority which is not recognized by the

United States as the de jure government of the foreign territory

concerned, any property situated in or any amount to be received in such

foreign territory and carried as an asset of any branch office of such

bank or trust company or national bank in such foreign territory is

seized, destroyed or cancelled, then the liability of such bank or trust

company or national bank for any deposit theretofore received and

thereafter to be repaid by it, and for any contract theretofore made and

thereafter to be performed by it, at any branch office in such foreign

territory shall be reduced pro tanto by the proportion that the value

(as shown by the books or other records of such bank or trust company or

national bank at the time of such seizure, destruction or cancellation)

of such assets bears to the aggregate of all the deposit and contract

liabilities of the branch office or offices of such bank or trust

company or national bank in such foreign territory, as shown at such

time by the books or other records of such bank or trust company or

national bank.

2-a. Notwithstanding the provisions of any law to the contrary, a bank

or trust company or national bank located in this state shall not be

required to repay any deposit made at a foreign branch of any such bank

if the branch cannot repay the deposit due to (i) an act of war,

insurrection, or civil strife; or (ii) an action by a foreign government

or instrumentality, whether de jure or de facto, in the country in which

the branch is located preventing such repayment, unless such bank has

expressly agreed in writing to repay the deposit under such

circumstances. The superintendent of financial services may promulgate

regulations necessary to effectuate the provisions of this subdivision,

including regulations providing for adequate disclosure to retail

depositors in the United States of the restrictions on repayment

contained in this subdivision. The provisions of this subdivision shall

not alter or diminish the liability of a custodian of assets of a fund

under section one hundred seventy-eight-a of the retirement and social

security law.

3. If any provision of this section, or the application of such

provision to any bank, trust company or national bank, shall be held

invalid, the remainder of this section, and the application of such

section to banks, trust companies and national banks other than those to

which it is held invalid, shall not be affected thereby.