TO: All Alabama Chartered Credit Union C.E.O.s
FM: Sarah H. Moore, Administrator
Re: Prohibitive use of the word “Bank”, “Banker,” or “Banking”
Date: March 17, 2016
It has come to my attention that the use of the word “Bank,” “Banker,” or “Banking” or similar names within any forms may not be used as part of a name for an entity that is not a bank or for advertising purposes. Below, please find Section 5-1A-3 Code of Alabama. I ask that you make yourself aware of these restrictions. All credit unions within the State of Alabama will need to adhere to the limitations placed upon the usage of these words.
§ 5-1A-3 Ala. Code:
The use of the words, “bank,” “banker,” “banking,” or words of similar meaning in the name or in advertising is restricted by Alabama Code Section 5-1A-3 to banking corporations organized under the laws of Alabama, other states, the United States, or foreign countries. All other entities are prohibited from using the words “bank”, “banker,” or “banking” in advertising or as a designation or name or as part of a designation or name under which business maybe conducted in Alabama unless the superintendent of the State of Alabama Banking Department determines that the use of the word by the entity is unlikely to mislead or confuse the public or give the impression that such entity is lawfully organized and operating as a bank and authorizes the use of the word. Any violation of this prohibition shall subject the party to penalties of $500 per day up to a maximum of $50,000.
The Banking Department’s prohibition on the use of the word Bank is not unlike the restrictions we have in section 5-17A-3. This department puts the same restrictions on the use of the words “credit Union” in any form.
The State Banking Department does not object to Credit Unions’ use of the words, “e-banking,” or “internet banking,” and the like used to describe a specific product.
If you have questions regarding the aforementioned, please do not hesitate to call Lloyd Moore or me at (334) 353-5770. You may wish to seek advice from legal counsel if you are unsure whether this applies to your circumstances.