Montana Division of Banking and Financial Institutions

Overview

The Montana Division of Banking and Financial Institutions (DBFI) is the primary state regulator responsible for overseeing financial institutions and money services businesses operating within Montana. As a division of the Montana Department of Administration, the DBFI exercises supervisory and regulatory authority over state-chartered banks, credit unions, trust companies, mortgage brokers, consumer loan companies, and money transmitters in Montana.

Key Distinction: Montana is the only U.S. state that does not require a separate money transmitter license at the state level. However, entities conducting money transmission in Montana must still comply with federal registration requirements and other applicable state and federal regulations.

Official Website: banking.mt.gov

Basic Identity

Classification

Inclusion Justification

What This Entity Oversees

Supervisory Scope

The DBFI exercises examination and supervision authority over regulated financial institutions. Under Montana Code Annotated Section 32-1-211:

Examination Frequency: The department shall examine each regulated bank or trust company at least once every 24 months.

Supervisory Powers: The DBFI may:

• Conduct examinations of books, records, and affairs

• Verify assets and liabilities

• Investigate methods of operation and business conduct

• Review accounting systems and methods

• Determine compliance with Montana law and sound banking principles

• Adopt and enforce rules implementing statutory requirements

Money Transmission Supervision

Requires verification from official sources - Given that Montana does not issue state money transmitter licenses, the extent of DBFI supervisory authority over non-licensed money transmitters is unclear. Entities may be subject to DBFI oversight if they engage in activities classified as banking or financial services under Montana law, or if they hold alternative licenses (such as Retail Sales Finance Company licenses).

Regulatory Reporting

Regulated entities must provide:

• Periodic financial reports and statements

• Examination findings responses

• Corrective action plans (if required)

• Records of transactions and customer information (if applicable)

General Consumer Protection Authority

The DBFI operates within the broader context of Montana consumer protection laws, including:

• Montana Unfair Trade Practices Act Requires verification from official sources

• Consumer fraud protections in financial transactions

• Data privacy and information security requirements (for regulated entities)

Electronic Funds Transfer Act

Montana Code Annotated Chapter 6 (Electronic Funds Transfer Act) provides consumer protections for electronic fund transfers, including:

• Disclosure requirements for financial institutions

• Error resolution procedures

• Liability limitations for unauthorized transfers

• Privacy protections for electronic fund transfer information

Complaint Handling

Consumers may file complaints with the DBFI regarding:

• Unfair or deceptive practices by regulated entities

• Violations of consumer protection requirements

• Fraud or misrepresentation

• Unlicensed operation of financial services

Requires verification from official sources - Specific complaint procedures and timelines for money transmission-related complaints.

Contact for Consumer Issues

• Phone: 406-841-2920

• Email: [email protected]

• Website: banking.mt.gov

Regulatory Powers

Administrative Enforcement

The DBFI possesses broad enforcement authority including:

• Issuance of cease-and-desist orders

• Suspension or revocation of licenses

• Administrative penalties and fines

• Consent orders requiring corrective action

• Appointment of receivers for insolvent institutions

• Removal of officers and directors (for certain violations)

Criminal Referral Authority

The DBFI may refer matters to state and federal law enforcement agencies for criminal prosecution, including:

• Unauthorized operation as a financial institution

• Fraud or misrepresentation

• Violation of financial institution laws

• Money laundering or structuring violations

Statutory Authority for Enforcement

Enforcement authority derives from Montana Title 32 and Section 32-1-211 (authority to examine and supervise financial institutions) and related sections of Montana law.

Requires verification from official sources - Specific enforcement procedures and penalties for money transmission violations in the absence of a state licensing requirement.

Regulatory Role and Function

Legal Foundation

Statutory Framework

The Montana Division of Banking and Financial Institutions derives its regulatory authority from Montana Title 32 - Financial Institutions. The division is established under Montana Code Annotated Section 32-1-211, which grants the Department of Administration authority over banking and financial institution supervision.

Organizational Structure

• Parent Agency: Montana Department of Administration

• Leadership: Melanie Hall, Commissioner of Banking and Financial Institutions (as of 2025-2026)

• Commissioner Authority: The Commissioner of Banking and Financial Institutions exercises supervision and control over the activities and employees of the division and administers all provisions of Montana financial institution laws.

Legal Authority Type

Binding — The DBFI's regulatory determinations and licensing decisions are binding on regulated entities within Montana's jurisdiction. Violation of DBFI orders or regulations can result in penalties, license revocation, and enforcement actions.

Licensing and Authorization Relevance

Unique Montana Framework

Montana maintains a distinctive regulatory approach to money transmission:

License Requirement: FALSE — Montana does not require a separate state money transmitter license.

Why: Money transmission is not defined or specifically regulated at the state level under Montana law. Montana is the only U.S. state without a state-level money transmitter licensing regime.

Federal Registration Requirement

Despite the absence of state licensing, entities conducting money transmission activities in Montana must register with FinCEN (Financial Crimes Enforcement Network) as a Money Services Business (MSB):

• Registration Form: FinCEN Form 107 (Money Services Business Registration)

• Frequency: Annual renewal required

• Cost: No federal filing fee (as of knowledge cutoff)

• Applicability: Any person who engages in money transmission or currency exchange in or into Montana must register with FinCEN

Application Process

Since Montana does not issue state money transmitter licenses, applicants typically:

1. Register with the Montana Secretary of State (general business registration)

2. File FinCEN Form 107 for federal MSB registration

3. Comply with federal Bank Secrecy Act (BSA) requirements

4. Maintain records and documentation as required by federal regulations

Requires verification from official sources - Current state-level guidance on whether alternative state licenses (e.g., Retail Sales Finance Company License) apply to certain money transmission activities.

Montana State Requirements

License Requirement: N/A (no state license issued)

Net Worth Requirements: Requires verification from official sources - Sources indicate conflicting information regarding whether minimum net worth requirements apply. Some sources suggest applicants must provide audited financial statements showing minimum net worth as determined by the DBFI; others indicate no state-level net worth requirement due to the lack of state licensing.

Surety Bond Requirement: Requires verification from official sources - While some sources reference surety bond amounts ranging from $25,000 to $500,000, this likely refers to other types of financial service licenses in Montana (such as Retail Sales Finance Company licenses) rather than money transmission specifically.

Federal Requirements

• FinCEN Registration: Required (Form 107)

• Federal Net Worth/Capital Requirements: Not specified by FinCEN for MSB registration

• Surety Bond: Not required by FinCEN

Contact for Financial Requirements Clarification

Applicants should contact the DBFI directly to determine whether any state-level financial requirements apply to their specific business activities:

• Phone: 406-841-2920

• Email: [email protected]

• Mailing Address: PO Box 200546, Helena, MT 59620

Regulatory Approach

Montana has not enacted specific state-level regulations addressing cryptocurrency, virtual assets, or digital currencies. The DBFI does not have a dedicated virtual currency licensing regime.

Applicability to Digital Assets

Entities operating in cryptocurrency or digital asset spaces in Montana may be subject to:

• Federal regulations (FinCEN, Federal Reserve, OCC guidelines)

• State money transmission laws (if applicable to their activities) — though note Montana lacks state-level money transmitter licensing

• General financial institution regulations if they provide banking-like services

• Consumer protection laws applying to fraudulent or deceptive practices

FinTech Guidance

The DBFI has published guidance directing applicants to reference NMLS (Nationwide Multistate Licensing System) to determine what licenses they may need based on their specific business activities.

NMLS Multistate MSB Licensing: FinTechs and money services businesses may apply for multistate licensing through NMLS, which provides a coordinated application process for entities conducting business in multiple states.

Requires verification from official sources - Whether the DBFI has issued specific guidance on stablecoin issuance, custody services, or decentralized finance (DeFi) activities.

Payments and Money Movement Relevance

The Montana Division of Banking and Financial Institutions has the following relevance to payments and money movement in United States:

Payment Systems Governed or Overseen

The Montana Division of Banking and Financial Institutions does not directly operate payment systems. Its payment-related role includes:

Money transmitters, payment processors, and fintech companies operating in this jurisdiction require licensing or registration with this entity.

Relationship to Other Regulators

Multistate Licensing Through NMLS

Entities conducting money transmission across multiple states may utilize the Nationwide Multistate Licensing System (NMLS) for coordinated regulatory compliance:

• NMLS MSB Licensing Program: Provides centralized application and reporting for multistate money services businesses

• Benefits: Single application process, coordinated underwriting, streamlined compliance

• Applicability: Available for entities licensing in multiple states

Requires verification from official sources - Montana's participation level in the NMLS MSB licensing program and specific state coordination procedures.

Conference of State Bank Supervisors (CSBS)

Commissioner Melanie Hall serves as Chair of the Conference of State Bank Supervisors (CSBS) Board of Directors (elected June 2025), indicating Montana's leadership role in interstate banking supervision and policy coordination.

Reciprocal Recognition

Requires verification from official sources - Whether Montana recognizes licenses or registrations issued by other states for money transmission or related financial services.

Geography and Jurisdiction Notes

Important Departments and Divisions

Key Public Resources

Main Office

Montana Division of Banking and Financial Institutions

• Physical Address: 1227 11th Avenue, Suite 100, Helena, Montana 59601

• Mailing Address: PO Box 200546, Helena, Montana 59620

• Phone: 406-841-2920

• Fax: 406-841-2930

• General Email: [email protected]

• Mortgage Licensing Email: [email protected]

• Website: banking.mt.gov

Leadership

• Commissioner: Melanie Hall, Commissioner of Banking and Financial Institutions

• Title: Chair, Conference of State Bank Supervisors (CSBS) Board of Directors (as of June 2025)

Regulatory Resources

• Money Transmitters Page: banking.mt.gov/moneytransmitters

• Forms: banking.mt.gov/home/forms

• Legislation and Rules: banking.mt.gov/Home/legislation

• About the Division: banking.mt.gov/About/index

Statutory References

• Montana Code Annotated Title 32 - Financial Institutions: law.justia.com/codes/montana/title-32/

• Section 32-1-211 (Examination and Supervision): findlaw.com

Federal Coordination

• FinCEN MSB Registration: fincen.gov

• NMLS - Nationwide Multistate Licensing System: nationwidelicensingsystem.org

Notes on Naming and Language