reglab/statecodes huggingface dataset:
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 32 - Powers, Organization, and Financial Requirements › Subchapter B. Amendment of Certificate; Changes in Capital and Surplus › Section 32.103. Change in Outstanding Capital and Surplus

Sec. 32.103.  CHANGE IN OUTSTANDING CAPITAL AND SURPLUS.  (a)  A state bank may not reduce or increase its outstanding capital and surplus through dividend, redemption, issuance of shares, or otherwise, without the prior written approval of the banking commissioner, except as permitted by this section or rules adopted under this subtitle.
(b)  Unless restricted by rule, prior written approval is not required for an increase in capital and surplus accomplished through:
(1)  issuance of shares of common stock for cash, or a cash contribution to surplus by shareholders that does not result in issuance of additional common stock or other securities;
(2)  declaration and payment of pro rata share dividends as defined by the Business Organizations Code; or
(3)  adoption by the board of a resolution directing that all or part of undivided profits be transferred to capital or surplus.
(c)  Prior approval is not required for:
(1)  a decrease in capital or surplus caused by losses in excess of undivided profits; or
(2)  a change in capital and surplus resulting from accounting adjustments required by a transaction approved by the banking commissioner if the accounting adjustments are reasonably disclosed in the submitted application.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 237 (H.B. 1962), Sec. 16, eff. September 1, 2007.
Acts 2007, 80th Leg., R.S., Ch. 735 (H.B. 2754), Sec. 4, eff. September 1, 2007.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 32 - Powers, Organization, and Financial Requirements › Subchapter B. Amendment of Certificate; Changes in Capital and Surplus › Section 32.104. Capital Notes or Debentures

Sec. 32.104.  CAPITAL NOTES OR DEBENTURES.  (a)  With the prior written approval of the banking commissioner, a state bank may at any time, through action of its board and without requiring action of its shareholders, issue and sell its capital notes or debentures.  The capital notes or debentures must be subordinate to the claims of depositors and may be subordinate to other claims, including the claims of other creditors or the shareholders.
(b)  Capital notes or debentures may be convertible into shares of any class or series.  The issuance and sale of convertible capital notes or debentures are subject to satisfaction of preemptive rights, if any, to the extent provided by law.
(c)  Without the prior written approval of the banking commissioner, a state bank may not pay interest due or principal repayable on outstanding capital notes or debentures when the bank is in hazardous condition or is insolvent, or to the extent that payment will cause the bank to be in hazardous condition or insolvent, as determined by the banking commissioner.
(d)  The amount of any outstanding capital notes or debentures that meet the requirements of this section and that are subordinated to unsecured creditors of the bank may be included in equity capital of the bank for purposes of determining hazardous condition or insolvency and for other purposes provided by rules adopted under this subtitle.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 237 (H.B. 1962), Sec. 17, eff. September 1, 2007.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 32 - Powers, Organization, and Financial Requirements › Subchapter C. Bank Offices › Section 32.201. Conduct of the Business of Banking

Sec. 32.201.  CONDUCT OF THE BUSINESS OF BANKING.  (a)  A state bank may engage in the banking business at its home office, at an approved branch office location, and through electronic terminals.  A drive-in facility must be approved as a branch if it is more than 2,000 feet from the nearest wall of the bank's home office or another approved branch office.
(b)  A function of a state bank that does not involve banking contact with the public may be conducted at any location without prior written approval of the banking commissioner.  The finance commission may adopt rules further defining functions of a state bank that are not required to be conducted at an approved location.
(c)  The finance commission by rule under Section 32.009 may authorize a new form of banking facility.  The banking commissioner may approve a new form of banking facility other than as provided by this subchapter if the banking commissioner does not have a significant supervisory or regulatory concern regarding the proposed facility.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 32 - Powers, Organization, and Financial Requirements › Subchapter C. Bank Offices › Section 32.202. Home Office

Sec. 32.202.  HOME OFFICE.  (a)  Each state bank must have and continuously maintain in this state a home office.  The home office must be a location at which the bank does business with the public and keeps its corporate books and records.  At least one officer of the bank must maintain an office at the home office.
(b)  A state bank may change its home office to one of its previously established branch locations in this state, if the location that is the home office before the change is to remain as a branch of the bank, by filing a written notice with the banking commissioner.  The notice must set forth the name of the bank, the street address of its home office before the change, the street address of the location to which the home office is to be changed, and a copy of the resolution adopted by the bank's board authorizing the change.  The change of home office takes effect on the 31st day after the date the banking commissioner receives the notice unless the banking commissioner consents to a different effective date.
(c)  A state bank may change its home office to any location in this state, other than as permitted by Subsection (b), on prior written approval of the banking commissioner.  The banking commissioner shall grant an application under this subsection if the banking commissioner does not have a significant supervisory or regulatory concern regarding the proposed banking facility, the applicant, or an affiliate of the applicant.  Any standard established by the banking commissioner or the finance commission regarding the establishment of a branch under Section 32.203 applies to an application for a change of home office that is subject to this subsection, except as otherwise provided by rules adopted under this subtitle.
(d)  If the proposed relocation of the bank's home office would effect an abandonment of all or part of the community served by the bank, the bank must establish to the satisfaction of the banking commissioner that the abandonment is consistent with the original determination of public necessity for the establishment of a bank at that location.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 1999, 76th Leg., ch. 344, Sec. 2.007, eff. Sept. 1, 1999.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 244 (H.B. 2219), Sec. 2, eff. September 1, 2007.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 32 - Powers, Organization, and Financial Requirements › Subchapter C. Bank Offices › Section 32.203. Branch Offices

Sec. 32.203.  BRANCH OFFICES.  (a)  A state bank may establish and maintain a branch office at any location on prior written approval of the banking commissioner.  If the banking commissioner does not have a significant supervisory or regulatory concern regarding the proposed branch, the applicant, or an affiliate of the applicant, the banking commissioner shall approve the application.
(b)  The finance commission may adopt rules establishing additional standards for the approval of branch offices.
(c)  A state bank may not establish or maintain a branch on the premises or property of an affiliate if the affiliate engages in a commercial activity.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 217 (H.B. 944), Sec. 2, eff. May 25, 2007.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 32 - Powers, Organization, and Financial Requirements › Subchapter C. Bank Offices › Section 32.204. Deposit or Loan Production Offices

Sec. 32.204.  DEPOSIT OR LOAN PRODUCTION OFFICES.  (a)  A state bank may establish one or more deposit or loan production offices for the purpose of:
(1)  soliciting deposit accounts, applications for loans, or equivalent transactions;
(2)  performing ministerial duties related to solicitations described by Subdivision (1); and
(3)  conducting other activities as permitted by rules adopted under this subtitle.
(b)  The bank shall notify the banking commissioner in writing of the location of and activities to be conducted at a proposed deposit or loan production office of the bank. The bank may establish the proposed office beginning on the 31st day after the date the banking commissioner receives the bank's notice unless the banking commissioner specifies that the proposed office be established on an earlier or later date.
(c)  The banking commissioner may extend the 30-day period prescribed by Subsection (b) on a determination that the bank's notice raises issues that require additional information or time for analysis.  If the period is extended, the bank may establish the proposed deposit or loan production office only with the prior written approval of the banking commissioner.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 2001, 77th Leg., ch. 412, Sec. 2.08, eff. Sept. 1, 2001.
Amended by:
Acts 2013, 83rd Leg., R.S., Ch. 940 (H.B. 1664), Sec. 4, eff. June 14, 2013.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 32 - Powers, Organization, and Financial Requirements › Subchapter D. Merger › Section 32.301. Merger Authority

Sec. 32.301.  MERGER AUTHORITY.  (a)  Two or more financial institutions, corporations, or other entities with the authority to participate in a merger, at least one of which is a state bank, may adopt and implement a plan of merger in accordance with this section.  The merger may not be made without the prior written approval of the banking commissioner if any surviving, new, or acquiring entity that is a party to the merger or created by the terms of the merger is a state bank or is not a financial institution.
(b)  Implementation of the merger by the parties and approval of the board, shareholders, or owners of the parties must be made or obtained in accordance with the Business Organizations Code as if the state bank were a filing entity and all other parties to the merger were foreign entities, except as may be otherwise provided by applicable rules.
(c)  A consummated merger has the effect provided by the Business Organizations Code.  A separate application is not required to relocate the home office of a surviving state bank or to grant authority to a surviving bank to operate new branch offices that previously existed as part of a merging financial institution if the intent of the surviving bank is clearly stated as part of the plan of merger.
(d)  A merger under this subchapter does not confer additional powers on a state bank beyond the powers conferred by other provisions of this subtitle.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 237 (H.B. 1962), Sec. 18, eff. September 1, 2007.
Acts 2013, 83rd Leg., R.S., Ch. 575 (S.B. 804), Sec. 8, eff. June 14, 2013.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 32 - Powers, Organization, and Financial Requirements › Subchapter D. Merger › Section 32.302. Approval of Banking Commissioner

Sec. 32.302.  APPROVAL OF BANKING COMMISSIONER.  (a)  If the merger is subject to the prior written approval of the banking commissioner, the original certificate of merger and a number of copies of the certificate equal to the number of surviving, new, and acquiring entities must be filed with the banking commissioner.  On this filing, the banking commissioner shall investigate the condition of the merging parties.  The banking commissioner may require the submission of additional information the banking commissioner determines necessary to an informed decision to approve or reject a merger under this subchapter.
(b)  The banking commissioner shall approve the merger only if:
(1)  each resulting state bank:
(A)  has complied with the laws of this state relating to the organization and operation of state banks;  and
(B)  will be solvent and have adequate capitalization for its business and location;
(2)  all deposit and other liabilities of each state bank that is a party to the merger have been properly discharged or otherwise assumed or retained by a financial institution;
(3)  each surviving, new, or acquiring entity that is not a depository institution will not be engaged in the unauthorized business of banking, and each state bank will not be engaged in a business other than banking or a business incidental to banking;
(4)  the parties have complied with the laws of this state;  and
(5)  all conditions imposed by the banking commissioner have been satisfied or otherwise resolved.
(c)  If the banking commissioner approves the merger and finds that all required filing fees and investigative costs have been paid, the banking commissioner shall:
(1)  endorse the face of the original and each copy of the certificate of merger with the date of approval and the word "Approved";
(2)  file the original of the certificate of merger in the department's records; and
(3)  deliver a certified copy of the certificate of merger to each surviving, new, or acquiring entity.
(d)  An approved merger takes effect on the date of approval unless the merger agreement provides for a different effective date.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
Amended by:
Acts 2013, 83rd Leg., R.S., Ch. 575 (S.B. 804), Sec. 9, eff. June 14, 2013.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 32 - Powers, Organization, and Financial Requirements › Subchapter D. Merger › Section 32.303. Rights of Dissenters From Merger

Sec. 32.303.  RIGHTS OF DISSENTERS FROM MERGER.  A shareholder may dissent from the merger to the extent, and by following the procedure provided, by the Business Organizations Code or any rules adopted under this subtitle.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 237 (H.B. 1962), Sec. 19, eff. September 1, 2007.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 32 - Powers, Organization, and Financial Requirements › Subchapter D. Merger › Section 32.304. Limitation on Control of Deposits

Sec. 32.304.  LIMITATION ON CONTROL OF DEPOSITS.  (a)  A merger is not permitted under this subchapter if, on consummation of the transaction, the resulting state bank, including all insured depository institution affiliates of the resulting state bank, would control 20 percent or more of the total amount of deposits in this state held by all insured depository institutions in this state.
(b)  On request of the banking commissioner the applicant shall provide supplemental information to the banking commissioner to aid in a determination under this section, including information that is more current than or in addition to information in the most recently available summary of deposits, reports of condition, or similar reports filed with or produced by state or federal authorities.
(c)  In this section, "deposit" and "insured depository institution" have the meanings assigned by Section 3, Federal Deposit Insurance Act (12 U.S.C. Section 1813), as amended.
Added by Acts 1999, 76th Leg., ch. 344, Sec. 2.008, eff. Sept. 1, 1999.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 32 - Powers, Organization, and Financial Requirements › Subchapter E. Purchase or Sale of Assets › Section 32.401. Authority to Purchase Assets

Sec. 32.401.  AUTHORITY TO PURCHASE ASSETS.  (a)  A state bank may purchase assets from another financial institution or other seller, except that the prior written approval of the banking commissioner is required if the purchase price exceeds an amount equal to three times the bank's unimpaired capital and surplus.  The finance commission by rule may require a state bank to obtain the prior written approval of the banking commissioner for a transaction not otherwise subject to approval that involves potentially substantial risks to the safety and soundness of the purchasing bank.
(b)  Except as otherwise expressly provided by another statute, the purchase of all or part of the assets of the selling entity does not make the purchasing bank responsible for any liability or obligation of the selling entity that the purchasing bank does not expressly assume.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 735 (H.B. 2754), Sec. 5, eff. September 1, 2007.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 32 - Powers, Organization, and Financial Requirements › Subchapter E. Purchase or Sale of Assets › Section 32.402. Authority to Act as Disbursing Agent

Sec. 32.402.  AUTHORITY TO ACT AS DISBURSING AGENT.  (a)  The purchasing bank may hold the purchase price and any additional money delivered to it by the selling institution in trust for, or as a deposit to the credit of, the selling institution and may act as agent of the selling institution in disbursing the money in trust or on deposit by paying the depositors and creditors of the selling institution.
(b)  If the purchasing bank acts under written contract of agency approved by the banking commissioner that specifically names each depositor and creditor and the amount to be paid each, and if the agency is limited to the purely ministerial act of paying those depositors and creditors the amounts due them as determined by the selling institution and reflected in the contract of agency and does not involve discretionary duties or authority other than the identification of the depositors and creditors named, the purchasing bank:
(1)  may rely on the contract of agency and the instructions included in it;  and
(2)  is not responsible for:
(A)  any error made by the selling institution in determining its liabilities, the depositors and creditors to whom the liabilities are due, or the amounts due the depositors and creditors;  or
(B)  any preference that results from the payments made under the contract of agency and the instructions included in it.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 32 - Powers, Organization, and Financial Requirements › Subchapter E. Purchase or Sale of Assets › Section 32.403. Liquidation of Selling Institution

Sec. 32.403.  LIQUIDATION OF SELLING INSTITUTION.  If the selling financial institution is at any time after the sale of assets voluntarily or involuntarily closed for liquidation by a state or federal regulatory agency, the purchasing bank shall pay to the receiver of the selling institution the balance of the money held by it in trust or on deposit for the selling institution and not yet paid to the depositors and creditors of the selling institution.  Without further action the purchasing bank is discharged from all responsibilities to the selling institution and to the selling institution's receiver, depositors, creditors, and shareholders.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 237 (H.B. 1962), Sec. 20, eff. September 1, 2007.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 32 - Powers, Organization, and Financial Requirements › Subchapter E. Purchase or Sale of Assets › Section 32.404. Payment to Depositors and Creditors

Sec. 32.404.  PAYMENT TO DEPOSITORS AND CREDITORS.  The purchasing bank may pay a depositor or creditor of the selling institution the amount to be paid the person under the terms of the contract of agency by opening an account in the name of the depositor or creditor, crediting the account with the amount to be paid the depositor or creditor under the terms of the agency contract, and mailing or personally delivering a duplicate deposit ticket evidencing the credit to the depositor or creditor at the person's address shown in the records of the selling institution.  The relationship between the purchasing bank and the depositor or creditor is that of debtor to creditor only to the extent of the credit reflected by the deposit ticket.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 32 - Powers, Organization, and Financial Requirements › Subchapter E. Purchase or Sale of Assets › Section 32.405. Sale of Assets

Sec. 32.405.  SALE OF ASSETS.  (a)  A state bank may sell a portion of its assets to another financial institution or other buyer, except that the prior written approval of the banking commissioner is required if the sales price exceeds an amount equal to three times the bank's unimpaired capital and surplus.  The finance commission by rule may require a state bank to obtain the prior written approval of the banking commissioner for a transaction not otherwise subject to approval that involves potentially substantial risks to the safety and soundness of the selling bank.
(b)  If the prior approval of the banking commissioner for a sale of assets is not required under Subsection (a) and the sale involves the disposition of a branch office or another established location of the state bank, the state bank must provide written notice of the transaction to the banking commissioner at least 30 days before the expected closing date of the transaction.
(c)  The board of a state bank, with the prior written approval of the banking commissioner, may cause the bank to sell all or substantially all of its assets without shareholder approval if:
(1)  the banking commissioner finds the interests of depositors and creditors are jeopardized because of insolvency or imminent insolvency and that the sale is in their best interest; and
(2)  the Federal Deposit Insurance Corporation or its successor approves the transaction and agrees to provide assistance to the prospective buyer under 12 U.S.C. Section 1823(c) or a comparable law unless the deposits of the bank are not insured.
(d)  A sale under Subsection (c) must include an assumption and promise by the buyer to pay or otherwise discharge:
(1)  all of the bank's liabilities to depositors;
(2)  all of the bank's liabilities for salaries of the bank's employees incurred before the date of the sale;
(3)  obligations incurred by the banking commissioner arising out of the supervision or sale of the bank; and
(4)  fees and assessments due the department.
(e)  This section does not affect the banking commissioner's right to take action under another law.  The sale by a state bank of all or substantially all of its assets with shareholder approval is considered a voluntary dissolution and liquidation and is governed by Subchapter B, Chapter 36.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 237 (H.B. 1962), Sec. 21, eff. September 1, 2007.
Acts 2007, 80th Leg., R.S., Ch. 735 (H.B. 2754), Sec. 6, eff. September 1, 2007.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 32 - Powers, Organization, and Financial Requirements › Subchapter E. Purchase or Sale of Assets › Section 32.406. Limitation on Control of Deposits

Sec. 32.406.  LIMITATION ON CONTROL OF DEPOSITS.  (a)  A purchase of assets is not permitted under Section 32.401 if, on consummation of the transaction, the acquiring state bank, including all insured depository institution affiliates of the resulting state bank, would control 20 percent or more of the total amount of deposits in this state held by all insured depository institutions in this state.
(b)  On request of the banking commissioner the applicant shall provide supplemental information to the banking commissioner to aid in a determination under this section, including information that is more current than or in addition to information in the most recently available summary of deposits, reports of condition, or similar reports filed with or produced by state or federal authorities.
(c)  In this section, "deposit" and "insured depository institution" have the meanings assigned by Section 3, Federal Deposit Insurance Act (12 U.S.C. Section 1813), as amended.
Added by Acts 1999, 76th Leg., ch. 344, Sec. 2.009, eff. Sept. 1, 1999.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 32 - Powers, Organization, and Financial Requirements › Subchapter F. Exit of State Bank or Entry of Another Financial Institution › Section 32.501. Merger or Conversion of State Bank Into Another Financial Institution

Sec. 32.501.  MERGER OR CONVERSION OF STATE BANK INTO ANOTHER FINANCIAL INSTITUTION.  (a)  Subject to Subtitle G, a state bank may act as necessary under and to the extent permitted by the laws of the United States, this state, another state, or another country to merge or convert into another financial institution, as that term is defined by Section 201.101.
(b)  The merger or conversion by the state bank must be made and approval of its board and shareholders must be obtained in accordance with the Business Organizations Code as if the state bank were a filing entity and all other parties to the transaction, if any, were foreign entities, except as provided by rule.  For purposes of this subsection, a conversion is considered a merger into the successor form of financial institution.
(c)  The state bank does not cease to be a state bank subject to the supervision of the banking commissioner unless:
(1)  the banking commissioner has been given written notice of the intention to merge or convert before the 31st day before the date of the proposed transaction;
(2)   the bank has filed with the banking commissioner:
(A)  a copy of the application filed with the successor regulatory authority, including a copy of each contract evidencing or implementing the merger or conversion, or other documents sufficient to show compliance with applicable law; and
(B)  a certified copy of all minutes of board meetings and shareholder meetings at which action was taken regarding the merger or conversion;
(3)  the banking commissioner determines that:
(A)  all deposit and other liabilities of the state bank are fully discharged, assumed, or otherwise retained by the successor form of financial institution;
(B)  any conditions imposed by the banking commissioner for the protection of depositors and creditors have been met or otherwise resolved; and
(C)  any required filing fees have been paid; and
(4)  the bank has received a certificate of authority to do business as the successor financial institution.
(d)  Section 32.304 applies to a proposed merger under this section.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 1999, 76th Leg., ch. 344, Sec. 2.010, eff. Sept. 1, 1999.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 237 (H.B. 1962), Sec. 22, eff. September 1, 2007.
Acts 2007, 80th Leg., R.S., Ch. 735 (H.B. 2754), Sec. 7, eff. September 1, 2007.
Acts 2013, 83rd Leg., R.S., Ch. 575 (S.B. 804), Sec. 10, eff. June 14, 2013.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 33 - Ownership and Management of State Bank › Subchapter A. Transfer of Ownership Interest › Section 33.001. Acquisition of Control

Sec. 33.001.  ACQUISITION OF CONTROL.  (a)  Except as otherwise expressly permitted by this subtitle, without the prior written approval of the banking commissioner a person may not directly or indirectly acquire a legal or beneficial interest in voting securities of a state bank or a corporation or other entity owning voting securities of a state bank if, after the acquisition, the person would control the bank.
(b)  For purposes of this subchapter and except as otherwise provided by rules adopted under this subtitle, the principal shareholder of a state bank that directly or indirectly owns or has the power to vote a greater percentage of voting securities of the bank than any other shareholder is considered to control the bank.
(c)  This subchapter does not prohibit a person from negotiating to acquire, but not acquiring, control of a state bank or a person that controls a state bank.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 237 (H.B. 1962), Sec. 24, eff. September 1, 2007.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 33 - Ownership and Management of State Bank › Subchapter A. Transfer of Ownership Interest › Section 33.003. Hearing and Decision on Acquisition of Control

Sec. 33.003.  HEARING AND DECISION ON ACQUISITION OF CONTROL.  (a)  Not later than the 60th day after the date the notice is published, the banking commissioner shall approve the application or set the application for hearing.  If the banking commissioner sets a hearing, the department shall participate as the opposing party and the banking commissioner shall conduct the hearing and one or more prehearing conferences and opportunities for discovery as the banking commissioner considers advisable and consistent with governing law.  A hearing held under this section is confidential and closed to the public.
(b)  Based on the record, the banking commissioner may issue an order denying an application if:
(1)  the acquisition would substantially lessen competition, restrain trade, result in a monopoly, or further a combination or conspiracy to monopolize or attempt to monopolize the banking industry in any part of this state, unless:
(A)  the anticompetitive effects of the proposed acquisition are clearly outweighed in the public interest by the probable effect of the acquisition in meeting the convenience and needs of the community to be served;  and
(B)  the proposed acquisition does not violate the law of this state or the United States;
(2)  the financial condition of the proposed transferee, or any member of a group comprising the proposed transferee, might jeopardize the financial stability of the bank being acquired;
(3)  plans or proposals to operate, liquidate, or sell the bank or its assets are not in the best interests of the bank;
(4)  the experience, ability, standing, competence, trustworthiness, and integrity of the proposed transferee, or any member of a group comprising the proposed transferee, are insufficient to justify a belief that the bank will be free from improper or unlawful influence or interference with respect to the bank's operation in compliance with law;
(5)  the bank will not be solvent, have adequate capitalization, or comply with the law of this state after the acquisition;
(6)  the proposed transferee has not furnished all information pertinent to the application reasonably required by the banking commissioner;  or
(7)  the proposed transferee is not acting in good faith.
(c)  If the banking commissioner approves the application, the transaction may be consummated.  If the approval is conditioned on a written commitment from the proposed transferee offered to and accepted by the banking commissioner, the commitment is enforceable against the bank and the transferee and is considered for all purposes an agreement under this subtitle.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 33 - Ownership and Management of State Bank › Subchapter A. Transfer of Ownership Interest › Section 33.004. Appeal From Adverse Decision

Sec. 33.004.  APPEAL FROM ADVERSE DECISION.  (a)  If a hearing has been held, the banking commissioner has entered an order denying the application, and the order has become final, the proposed transferee may appeal the order by filing a petition for judicial review.
(b)  The filing of an appeal under this section does not stay the order of the banking commissioner.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 33 - Ownership and Management of State Bank › Subchapter A. Transfer of Ownership Interest › Section 33.005. Exemptions

Sec. 33.005.  EXEMPTIONS.  The following acquisitions are exempt from Section 33.001:
(1)  an acquisition of securities in connection with the exercise of a security interest or otherwise in full or partial satisfaction of a debt previously contracted for in good faith and the acquiring person files written notice of acquisition with the banking commissioner before the person votes the securities acquired;
(2)  unless the banking commissioner provides otherwise in writing, an acquisition of voting securities in any class or series by a controlling person who:
(A)  was identified as a controlling person in a state bank in a prior application filed with and approved by the banking commissioner;
(B)  has from the date of receipt of approval under this subchapter continuously held power to vote 25 percent or more of any class of voting securities of the state bank; or
(C)  is considered to have from the date of receipt of approval under this subchapter continuously controlled the state bank under Section 33.001(b);
(3)  an acquisition or transfer by operation of law, will, or intestate succession and the acquiring person files written notice of acquisition with the banking commissioner before the person votes the securities acquired;
(4)  a transaction subject to Chapter 202 if:
(A)  the acquiring bank holding company currently owns and controls a state bank; or
(B)  the post-transaction controlling person is identified as the controlling person in a merger or other acquisition-related application filed with the banking commissioner concurrently with the submission required by Section 202.001; and
(5)  a transaction exempted by the banking commissioner or by rules adopted under this subtitle because the transaction is not within the purposes of this subchapter or the regulation of the transaction is not necessary or appropriate to achieve the objectives of this subchapter.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 1999, 76th Leg., ch. 344, Sec. 2.011, eff. Sept. 1, 1999.
Amended by:
Acts 2019, 86th Leg., R.S., Ch. 652 (S.B. 1823), Sec. 4, eff. September 1, 2019.
Acts 2023, 88th Leg., R.S., Ch. 989 (H.B. 3574), Sec. 4, eff. June 18, 2023.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 33 - Ownership and Management of State Bank › Subchapter A. Transfer of Ownership Interest › Section 33.006. Objection to Other Transfer

Sec. 33.006.  OBJECTION TO OTHER TRANSFER.  This subchapter does not prevent the banking commissioner from investigating, commenting on, or seeking to enjoin or set aside a transfer of voting securities that evidence a direct or indirect interest in a state bank, regardless of whether the transfer is governed by this subchapter, if the banking commissioner considers the transfer to be against the public interest.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 33 - Ownership and Management of State Bank › Subchapter A. Transfer of Ownership Interest › Section 33.007. Civil Enforcement; Criminal Penalty

Sec. 33.007.  CIVIL ENFORCEMENT;  CRIMINAL PENALTY.  (a)  If the banking commissioner believes that a person has violated or is about to violate this subchapter or a rule of the finance commission or order of the banking commissioner pertaining to this subchapter, the attorney general on behalf of the banking commissioner may apply to a district court of Travis County for an order enjoining the violation and for other equitable relief the nature of the case requires.
(b)  A person who knowingly fails or refuses to file the application required by Section 33.002 commits an offense.  An offense under this subsection is a Class A misdemeanor.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 2001, 77th Leg., ch. 867, Sec. 21, eff. Sept. 1, 2001.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 33 - Ownership and Management of State Bank › Subchapter B. Board and Officers › Section 33.101. Voting Securities Held by Bank

Sec. 33.101.  VOTING SECURITIES HELD BY BANK.  (a)  Voting securities of a state bank held by the bank in a fiduciary capacity under a will or trust, whether registered in the bank's name or in the name of its nominee, may not be voted in the election of directors or on a matter affecting the compensation of directors, officers, or employees of the bank in that capacity unless:
(1)  under the terms of the will or trust, the manner in which the voting securities are to be voted may be determined by a donor or beneficiary of the will or trust and the donor or beneficiary makes the determination in the matter at issue;
(2)  the terms of the will or trust expressly direct the manner in which the securities must be voted so that discretion is not vested in the bank as fiduciary; or
(3)  the securities are voted solely by a cofiduciary that is not an affiliate of the bank, as if the cofiduciary were the sole fiduciary.
(b)  Voting securities of a state bank that cannot be voted under this section are considered to be authorized but unissued for purposes of determining the procedures for and results of the affected vote.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 237 (H.B. 1962), Sec. 25, eff. September 1, 2007.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 33 - Ownership and Management of State Bank › Subchapter B. Board and Officers › Section 33.102. Bylaws

Sec. 33.102.  BYLAWS.  Each state bank shall adopt bylaws and may amend its bylaws for the purposes and according to the procedures provided by the Business Organizations Code.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 237 (H.B. 1962), Sec. 26, eff. September 1, 2007.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 33 - Ownership and Management of State Bank › Subchapter B. Board and Officers › Section 33.103. Board of Directors

Sec. 33.103.  BOARD OF DIRECTORS.  (a)  The board of a state bank must consist of not fewer than five but not more than 25 directors, a majority of whom are residents of this state.  The principal executive officer of the bank is a member of the board.  The principal executive officer acting in the capacity of a board member is the board's presiding officer unless the board elects a different presiding officer to perform the duties as designated by the board.
(b)  Unless the banking commissioner consents otherwise in writing, a person may not serve as director of a state bank if:
(1)  the bank incurs an unreimbursed loss attributable to a charged-off obligation of or holds a judgment against:
(A)  the person; or
(B)  an entity that was controlled by the person at the time of funding and at the time of default on the loan that gave rise to the judgment or charged-off obligation;
(2)  the person is the subject of an order described by Section 35.007(a); or
(3)  the person has been convicted of a felony.
(c)  If a state bank does not elect directors before the 61st day after the date of its regular annual meeting, the banking commissioner may appoint a conservator under Chapter 35 to operate the bank and elect directors, as appropriate.  If the conservator is unable to locate or elect persons willing and able to serve as directors, the banking commissioner may close the bank for liquidation.
(d)  A vacancy on the board that reduces the number of directors to fewer than five must be filled not later than the 30th day after the date the vacancy occurs.   If the vacancy is not timely filled, the banking commissioner may appoint a conservator under Chapter 35 to operate the bank and elect a board of not fewer than five persons to resolve the vacancy.  If the conservator is unable to locate or elect five persons willing and able to serve as directors, the banking commissioner may close the bank for liquidation.
(e)  Before each term to which a person is elected to serve as a director of a state bank, the person shall submit an affidavit for filing in the minutes of the bank stating that the person, to the extent applicable:
(1)  accepts the position and is not disqualified from serving in the position;
(2)  will not violate or knowingly permit an officer, director, or employee of the bank to violate any law applicable to the conduct of business of the bank; and
(3)  will diligently perform the duties of the position.
(f)  The banking commissioner in the exercise of discretion may waive or reduce the residency requirements for directors set forth in Subsection (a).
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 1999, 76th Leg., ch. 344, Sec. 2.0115, eff. Sept. 1, 1999;  Acts 2001, 77th Leg., ch. 412, Sec. 2.10, eff. Sept. 1, 2001.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 237 (H.B. 1962), Sec. 27, eff. September 1, 2007.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 33 - Ownership and Management of State Bank › Subchapter B. Board and Officers › Section 33.104. Advisory Director

Sec. 33.104.  ADVISORY DIRECTOR.  (a)  An advisory director is not considered a director if the advisory director:
(1)  is not elected by the shareholders of the bank;
(2)  does not vote on matters before the board or a committee of the board;
(3)  is not counted for purposes of determining a quorum of the board or committee; and
(4)  provides solely general policy advice to the board.
(b)  A state bank may not disclose to an advisory director confidential information pertaining to the bank or the bank's customers unless:
(1)  the board adopts a resolution that designates the advisory director as a person who is officially connected to the bank and that describes the purpose for disclosure of the information, which must be a reasonable business purpose;  and
(2)  the disclosure is made under a written confidentiality agreement between the bank and the advisory director.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 237 (H.B. 1962), Sec. 28, eff. September 1, 2007.
Acts 2013, 83rd Leg., R.S., Ch. 940 (H.B. 1664), Sec. 5, eff. June 14, 2013.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 33 - Ownership and Management of State Bank › Subchapter B. Board and Officers › Section 33.105. Required Monthly Board Meeting

Sec. 33.105.  REQUIRED MONTHLY BOARD MEETING.  (a)  Except as provided by Subsection (b), the board of a state bank shall hold at least one regular meeting each month.
(b)  On application by the board, the banking commissioner may grant the board approval to hold regular meetings on a less frequent basis than the period prescribed by Subsection (a).  The commissioner may revoke or modify a prior approval granted under this subsection if the commissioner determines that more frequent regular meetings of the board are necessary to promote the safety and soundness of the bank.
(c)  At each regular meeting the board shall review and approve the minutes of the prior meeting and review the operations, activities, and financial condition of the bank.  The board may designate a committee from among its members to perform those duties and approve or disapprove the committee's report at each regular meeting.  Each action of the board must be recorded in its minutes.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 110 (H.B. 2007), Sec. 14, eff. September 1, 2007.
Acts 2013, 83rd Leg., R.S., Ch. 940 (H.B. 1664), Sec. 6, eff. June 14, 2013.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 33 - Ownership and Management of State Bank › Subchapter B. Board and Officers › Section 33.106. Officers

Sec. 33.106.  OFFICERS.  (a)  The board shall annually appoint the officers of the bank, who serve at the will of the board.  Unless the banking commissioner consents otherwise in writing, a person may not serve as an officer of the state bank if:
(1)  the person is the subject of an order described by Section 35.007(a); or
(2)  the person has been convicted of a felony.
(b)  The bank must have a principal executive officer primarily responsible for the execution of board policies and operation of the bank and an officer responsible for the maintenance and storage of all corporate books and records of the bank and for required attestation of signatures.  Those positions may not be held by the same person.  The board may appoint other officers of the bank as the board considers necessary.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
Amended by:
Acts 2017, 85th Leg., R.S., Ch. 599 (S.B. 1401), Sec. 5, eff. September 1, 2017.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 33 - Ownership and Management of State Bank › Subchapter B. Board and Officers › Section 33.107. Limitation on Action of Officer or Employee in Relation to Asset or Liability

Sec. 33.107.  LIMITATION ON ACTION OF OFFICER OR EMPLOYEE IN RELATION TO ASSET OR LIABILITY.  Unless expressly authorized by a resolution of the board recorded in its minutes, an officer or employee may not create or dispose of a bank asset or create or incur a liability on behalf of the bank.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
2023 Texas Statutes › Finance Code › Title 3 - Financial Institutions and Businesses › Subtitle A - Banks › Chapter 33 - Ownership and Management of State Bank › Subchapter B. Board and Officers › Section 33.108. Criminal Offenses

Sec. 33.108.  CRIMINAL OFFENSES.  (a)  An officer, director, employee, or shareholder of a state bank commits an offense if the person knowingly:
(1)  conceals information or a fact, or removes, destroys, or conceals a book or record of the bank for the purpose of concealing information or a fact, from the banking commissioner or an agent of the banking commissioner; or
(2)  removes, destroys, or conceals any book or record of the bank that is material to a pending or anticipated legal or administrative proceeding.
(b)  An officer, director, or employee of a state bank commits an offense if the person:
(1)  knowingly makes a false entry in a book, record, report, or statement of the bank; or
(2)  violates or knowingly participates in a violation of, or permits another of the bank's officers, directors, or employees to violate, the prohibition on lending trust funds under Section 113.052, Property Code.
(c)  An offense under this section is a felony of the third degree.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.
Amended by:
Acts 2007, 80th Leg., R.S., Ch. 237 (H.B. 1962), Sec. 29, eff. September 1, 2007.