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Spring 2014

Issues in Participation Agreements, Continued

By Jeffery E. Smith, Anthony D. Weis and Thomas O. Ruby

Following our bulletin on this topic of more than a year ago, we continue to encounter situations with clients involving the accounting and regulatory treatment of certain loan participations. Given the widespread use of loan participations, and the potential serious problems that may arise from having to reclassify participations in regulatory call reports or published financial statements (including potential regulatory issues that may result), we felt it appropriate to revisit participation agreements to provide an update on the issue. Read more.

Ohio House Bill — The Ohio Legacy Trust Act and Due Diligence Concerns

By Brenda K. Bowers

Ohio House Bill 479, which became effective on March 20, 2013, enacted Sections 5816.01-14 of the Ohio Legacy Trust Act, allowing and enabling individuals who properly create a Legacy Trust under the provisions of the Act to shield assets conveyed to the Legacy Trust from creditors. Read more.

Patent Trolls Continue to Target Financial Institutions, but Change May Be Near

By Susanne M. Hopkins

For patent trolls, the end may be near. After years of extorting tribute from America’s financial institutions, patent trolls can expect 2014 to be the year of living dangerously.

A patent troll is an entity created solely to make money by claiming intellectual property rights and filing lawsuits.

Once upon a time, patent trolls challenged the Googles and Oracles of the world. Patent trolls have already demanded billions of dollars from grocers, hotels and retailers without the time or money to litigate. According to press accounts, one patent troll sent 8,000 letters to small businesses demanding compensation because the companies provided Wi-Fi to customers. Read more.

New Focus on Tax Sharing Agreements for Financial Institutions

By David A. Froling

As most bankers know, Ohio adopted a new Ohio Financial Institutions Tax (FIT), which is based on a consolidated entity formula explained below.  Given the new consolidated approach to taxing financial institutions with a presence in Ohio and the bank regulatory issues that accompany any type of inter-company and bank liability sharing or exchange, it is important that financial institutions have in place an appropriate tax sharing agreement.  This agreement must meet regulatory scrutiny and provide compliance with applicable bank regulatory requirements as well as the requirements of the FIT. Read more.

Vorys Ranked Seventh Nationally in Bank Mergers and Acquisitions in 2013

Vorys ranked seventh nationally in the number of bank and thrift merger and acquisition transactions completed in FY2013, based on a report released by SNL Financial. Vorys was the only Ohio-based law firm in the top 30 on this list. The firm also ranked 14th nationally based on the total value of the transactions.

Vorys provides a full array of legal services to both national- and state-chartered banks and thrifts, and their holding companies and subsidiaries. Vorys advises financial institution clients and their management and boards on issues related to strategic options including expanding their businesses through mergers, acquisitions and formation of holding companies, raising capital, charter conversions, branch sales and purchases and interstate branching. The firm also assists financial institution clients in complying with increasingly complex federal and state laws and regulations impacting the industry.

SNL Financial collects, standardizes and disseminates all relevant corporate, financial, market and M&A data – plus news and analysis – for the following industries: banking, financial services, insurance, real estate, energy, media/communications and metals and mining.

If you have an idea for an article you would like us to pursue, please contact your Vorys attorney. We hope you enjoy the read.



Aaron S. Berke

Elizabeth Turrell Farrar

David A. Froling

Jason L. Hodges

Michael D. Martz

Kimberly J. Schaefer

Jeffery E. Smith

J. Bret Treier

Anthony D. Weis



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This alert is for general information purposes and should not be regarded as legal advice. As always, please let us know if you want more information or have questions about how these developments apply to your situation.