Ga. Comp. R. & Regs. R. 80-12-7-.01 - Minimum Capital Requirements

(1) MALPBs must continuously maintain at least the minimum leverage capital ratio, PV capital, risk capital, and statutory capital requirements set forth in this rule. The capital standards in this part are the minimum acceptable for an MALPB whose overall financial condition is fundamentally sound, which is well-managed and which has no material or significant operational or financial weaknesses. Thus, the Department is not precluded from requiring an MALPB to maintain a higher leverage capital ratio, PV capital, risk capital, or statutory capital level based on the MALPB's particular risk profile. The Department will evaluate the factors set forth in Rule 80-12-2-.08 in analyzing the MALPB's capital adequacy and may determine that the minimum leverage capital ratio, PV capital, risk capital, or statutory capital for that MALPB is greater than the minimum standards stated in this Rule. These same criteria will apply to any MALPB seeking authorization from the Department to engage in any activity if the Department believes the adequacy of the MALPB's capital structure is relevant to the requested authorization.

(2) The minimum leverage capital ratio requirement for an MALPB shall not be less than ten (10) percent.

(3) The minimum PV capital requirement for an MALPB shall not be less than:

(a) 5.00 percent of the tier of PV up to $10 million, plus

(b) 3.00 percent of the tier of PV above $10 million up to $25 million, plus

(c) 1.50 percent of the tier of PV above $25 million up to $100 million, plus

(d) 0.75 percent of the tier of PV above $100 million up to $250 million, plus

(e) 0.25 percent of the tier of PV above $250 million up to $1 billion, plus

(f) 0.15 percent of the tier of PV above $1 billion up to $5 billion, plus

(g) 0.08 percent of the tier of PV above $5 billion up to $20 billion, plus

(h) 0.05 percent of the tier of PV above $20 billion.

(4) The minimum risk capital requirement for an MALPB shall not be less than the greater of: a) two times the average monthly chargebacks over the previous six (6) month period; or b) two times the average monthly forecast dollar volume of chargebacks for the upcoming six (6) month period.

(5) The Department's MALPB charter approval will include a requirement to have and maintain minimum statutory capital, which in no event shall be less than $3 million.

(6) An MALPB with less than the minimum leverage capital ratio, PV capital, risk capital, or statutory capital requirement:

(a) Is operating with inadequate capital and, therefore, has inadequate financial resources. Thus, at the discretion of the Department, such MALPB may be deemed to be operating in an unsafe or unsound or unauthorized manner and subject to the Department's enforcement powers, including, but not limited to, those set forth in O.C.G.A. 7-1-91.

(b) Must file a written capital restoration plan with the Department within thirty (30) days of the date that the MALPB knows or should have known that the MALPB is operating with an inadequate capital structure, unless the Department notifies the MALPB in writing that the plan is to be filed within a different period.

Notes

Ga. Comp. R. & Regs. R. 80-12-7-.01

O.C.G.A. §§ 7-9-3, 7-9-12, 7-9-13.

Original Rule entitled "Minimum Capital Requirements" adopted. F. Dec. 3, 2013; eff. Dec. 23, 2013. Amended: F. July 12, 2024; eff. Aug. 1, 2024. Amended: F. Dec. 20, 2024; eff. Jan. 9, 2025.