Regulations last checked for updates: Oct 18, 2024

Title 12 - Banks and Banking last revised: Oct 15, 2024
§ 7.2023 - National bank reverse stock splits.

(a) Authority to engage in reverse stock splits. A national bank may engage in a reverse stock split if the transaction serves a legitimate corporate purpose and provides adequate dissenting shareholders' rights.

(b) Legitimate corporate purpose. Examples of legitimate corporate purposes include a reverse stock split to:

(1) Reduce the number of shareholders in order to qualify as a Subchapter S corporation; and

(2) Reduce costs associated with shareholder communications and meetings.

[64 FR 60099, Nov. 4, 1999]
authority: 12 U.S.C. 1
source: 61 FR 4862, Feb. 9, 1996, unless otherwise noted.
cite as: 12 CFR 7.2023