How to Start a Bank in Florida

by Charles Crawford; Updated September 26, 2017
Starting a bank in Florida is a true challenge.

Are you and a group of business friends thinking about starting a new bank in Florida? If so, you have to be prepared for a thorough application process with the Florida Office of Financial Regulation. Your proposed executive officers will have to undergo a thorough vetting. In addition, you will need to analyze the market area, locate the bank's head office, raise sufficient capital, and select the type of charter for the bank. Beyond the basic application, there are many other actions that you and the other organizers must fulfill before you will be allowed to open the doors and begin operations.

Items you will need

  • Starting capital
  • Study of market area
  • Background investigations of leadership team
  • Attorneys and accountants

Bank Application Process

Step 1

Select a chief executive officer whose background and qualifications make him satisfactory to the state. This normally requires a thorough investigation. Your proposed CEO’s prior banking experience is most important.

Step 2

Select the rest of the members of the would-be bank’s leadership team. This includes the other executive officers, the principal stockholders and the directors. Background checks will yield information on the competence, experience, integrity, and financial ability of each member. You and your colleagues should seek directors who know about the market and the services that the new bank will provide and have ties to the community.

Step 3

Conduct an extensive analysis of the proposed bank’s market area. Economic conditions in the area must give a reasonable indication that the new banking operation can succeed. Here you and the other organizers must show that there is a big enough volume of business for which the new bank can compete.

Step 4

Select a location for the main banking premises. Decide whether to own or lease the premises.

Step 5

Determine the bank’s starting capital. Florida has a statutory minimum of $8 million, but it generally requires more. The state takes a number of factors into consideration in deciding on the adequacy of capital for a new bank. Among these factors are: economic and competitive conditions in the community, the experience of management, and the ability to raise additional capital when needed.

Step 6

Choose one of two commercial bank charters -- either a state-chartered bank or a national bank chartered under federal law.

Step 7

Determine whether to form a one-bank holding company. To do so requires filing a separate application with the Federal Reserve System.

Step 8

Name the bank. The bank’s name should not be the same or "deceptively similar" to any other bank in Florida.

Step 9

Determine whether to elect S corporation status for tax purposes.

Step 10

Open the new bank and commence operations, after satisfactory completion of all phases of the application process. The phases are: pre-application discussions; application filing; application processing; issuance of the final order approving the proposed bank; completion of the bank’s organization and stock subscriptions; pre-charter examination; pre-opening procedures and issuance of the charter.

Tips

  • You should should consider engaging the services of attorneys, accountants and consultants who are already familiar with this process.

About the Author

Charles Crawford, a former commercial banker, has been a business writer in New York since 1990. He has produced marketing materials for an executive outplacement firm, written the quarterly newsletter of a medical nonprofit organization and created financing proposals/business plans. Crawford holds a Bachelor of Arts in English and a Master of Science in international affairs from Florida State University.

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