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EnerBank USA

FEDERAL DEPOSIT INSURANCE CORPORATION

IN RE: EnerBank USA
Salt Lake City, Salt Lake County, Utah
Application for Federal Deposit Insurance (Bank Insurance Fund)

ORDER

The undersigned, acting under delegated authority, has fully considered all relevant facts and information relating to the factors of Section 6 of the Federal Deposit Insurance Act regarding the application for federal deposit insurance for EnerBank USA, a proposed new Utah industrial loan company to be located at 1245 E. Brickyard Road, Suite 100, Salt Lake City, Salt Lake County, Utah, and has concluded that the application should be approved.

Accordingly, it is hereby ORDERED, for the reasons set forth in the attached Statement, that the application submitted by EnerBank USA for federal deposit insurance be and the same hereby is approved subject to the following conditions:

1. That beginning paid-in capital funds of not less than $13,400,000 be provided, and that a ratio of Tier 1 Leverage Capital to total assets of not less than eight percent will be maintained throughout the first three years of operation;

2. That any changes in proposed management or proposed ownership (10 percent or more of stock), including new acquisitions of or subscriptions to 10 percent or more of stock, will render this commitment null and void unless such proposal is approved by the Regional Director of the FDIC's San Francisco Regional Office (Regional Director) prior to opening of the bank;

3. That the institution will operate within the parameters of the business plan submitted to the FDIC. Furthermore, during the first three years of operations, the institution will notify the Regional Director of any proposed major deviation or material change from the submitted plan 60 days before consummation of the change;

4. That the institution will obtain an audit of financial statements by an independent public accountant annually for at least the first three years after deposit insurance is effective, furnish a copy of any reports by the independent auditor (including any management letters) to the appropriate FDIC Regional Director within 15 days after their receipt by the bank and notify the Regional Director within 15 days when a change in its independent auditor occurs;

5. That adequate blanket bond coverage be obtained;

6. That an accrual accounting system be adopted for maintaining the bank's books;

7. That federal deposit insurance shall not become effective unless and until the applicant has been established as an industrial loan company (not a member of the Federal Reserve System), that it has authority to conduct a banking business, and that its establishment and operation as a bank have been fully approved by the appropriate State Authority;

8. That until the conditional commitment herein granted becomes effective, the FDIC shall have the right to alter, suspend or withdraw said commitment should any interim development be deemed to warrant such action; and

9. That if federal deposit insurance has not become effective within twelve months from the date of this ORDER, or unless, in the meantime, a request for an extension of time has been approved by the FDIC, the consent granted herein shall expire at the end of the said twelve-month period.

Dated at Washington, D.C. this day of , 2002.

FEDERAL DEPOSIT INSURANCE CORPORATION

By________________________________
Michael J. Zamorski
Director
Division of Supervision


FEDERAL DEPOSIT INSURANCE CORPORATION

IN RE: EnerBank USA
Salt Lake City, Salt Lake County, Utah
Application for Federal Deposit Insurance (Bank Insurance Fund)

STATEMENT

Pursuant to the provisions of Section 5 of the Federal Deposit Insurance Act (12 U.S.C.? 1815), an application for federal deposit insurance has been filed for EnerBank USA, a proposed new Utah industrial loan company, to be located at 1245 E. Brickyard Road, Suite 100, Salt Lake City, Salt Lake County, Utah.

The applicant's top-level parent, CMS Energy Corporation, is a publicly held Michigan corporation that is the parent of Michigan's largest gas and electric utility, Consumers Energy Company. The company is also involved in natural gas exploration, production, and transportation.

The proposed institution will provide financing to homeowners for the replacement or upgrade of heating, ventilating, and air conditioning systems and for other energy related improvements. EnerBank USA intends to offer its products through program sponsors located throughout the country. The applicant will operate from its headquarters and from an operations center in Jackson, Michigan.

For the purposes of this proposal, capital is adequate, projections for future earnings prospects are favorable, management is considered satisfactory, and the investment in fixed assets is reasonable. Corporate powers to be exercised are consistent with the purpose of the Federal Deposit Insurance Act. No formal objections to this proposal have been filed and no undue risk to the insurance fund is apparent.

Accordingly, based upon careful evaluation of all available facts and information, the Director, acting under delegated authority, has concluded that approval of the application is warranted.

DIRECTOR
DIVISION OF SUPERVISION



Last Updated 03/24/2011 Legal@fdic.gov