CT HB05220

Repeals and replaces subsection (a) of Connecticut General Statutes section 36a-262, effective October 1, 2022, governing lending limitations for Connecticut banks.

Sets liability limits for Connecticut banks based on obligor type: unsecured liabilities capped at 15% of the bank's equity capital and reserves for loan and lease losses, and fully secured liabilities capped at 10% (as separate additional limit).

Requires banks to account for credit exposure from derivative transactions when calculating obligor liability limits, with the commissioner authorized to establish the methodology.

Defines key terms including "primary obligor," "guarantor," "indemnitor," and "derivative transaction," and clarifies when guarantors or indemnitors are excluded from obligor status based on four specified conditions.

Permits temporary six-hour exceptions to lending limitations if the bank immediately assigns or participates out the excess amount to other persons, and establishes separate 15% limitation for endorsements or guarantees of installment consumer paper.