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The Delaware Legacy

Many of the major financial institutions have made Delaware their home due to the State’s world-renowned corporation law and pro-business legislation.


Due in no small part to Delaware’s pro-business legal and regulatory environment, strategic positioning, and landmark legislation, dozens of major financial institutions have made Delaware their home. New financial institutions continue to be granted charters in Delaware, including special purpose banks formed through new organizations or acquisitions.


The passage of the Financial Center Development Act in 1981 created strong economic incentives for the banking industry in Delaware, including a favorable state tax structure and the elimination of usury laws. The State subsequently enacted additional legislation in order to sustain the State’s competitive advantage in banking. In 1989, the Bank and Trust Company Insurance Powers Act was signed into law, allowing state-chartered banks and trust companies to underwrite and sell various types of insurance. In 1995, the State issued the Incidental Powers Regulation, designed to keep Delaware competitive by allowing state-chartered banks and trust companies to exercise additional powers incidental to banking. In 2006 Delaware’s tax structure was modernized, allowing banks to elect an alternate system based on a three-factor income apportionment for multi-state operations. In addition, a location benefit tax reflecting the value of utilizing Delaware’s banking laws and bank system was also implemented at that time.


For nearly three decades, Delaware has been world renowned for its banking, financial services, and insurance industries. Partnering with many innovative and dynamic financial companies around the globe, Delaware established itself as the place for international financial institutions looking to enter U.S. markets. As a result, the financial services industry has become a key component of Delaware’s economic strength and growth.


As one of the State’s largest private-sector employers, the financial services industry is composed of a large, interconnected community of credit card banks, commercial banks, nonbanking financial entities, investment advisors, insurance companies, trust entities, and service providers. In 2010 this industry had over 40,000 employees.


There are currently more than 70 banks and trust companies located in Delaware. They include full-service commercial banks, credit card banks, nondeposit and limited purpose trust companies, wholesale banks, and federal and state savings banks. Credit cards are also a major industry in Delaware and include Bank of America, JP Morgan Chase, Discover Bank, and Barclays Bank Delaware. Other major bank employers include Wilmington Trust, M&T, PNC, ING Direct, Citigroup, WSFS, Wells Fargo, and HSBC.



Excerpted from Delaware Laws & Programs Affecting Business, Samuel A. Nolen and Willam A. Yemc, Eds. Richards, Layton and Finger, 2011.



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