CHAPTER 202. BANK HOLDING COMPANIES

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FINANCE CODE

TITLE 3. FINANCIAL INSTITUTIONS AND BUSINESSES

SUBTITLE G. BANK HOLDING COMPANIES; INTERSTATE BANK OPERATIONS

CHAPTER 202. BANK HOLDING COMPANIES

Sec. 202.001. ACQUISITION OF BANK OR BANK HOLDING COMPANY. (a)

A company intending to acquire a Texas bank holding company or a

Texas bank shall submit to the commissioner a copy of the

application for approval or notice submitted to the Board of

Governors of the Federal Reserve System under Section 3, Bank

Holding Company Act (12 U.S.C. Section 1842). The copy must be:

(1) submitted to the commissioner when the application is

submitted to the board of governors;

(2) accompanied by any additional information required under

Subsection (b); and

(3) accompanied by any filing fee required by law.

(b) An applicant or notificant that is an out-of-state bank

holding company shall provide satisfactory evidence to the

commissioner of compliance with or inapplicability of:

(1) the requirements of Section 202.003; and

(2) if the applicant or notificant is not incorporated under the

laws of this state, the laws of this state relating to

registration of foreign corporations to do business in this

state.

Holding Company Act (12 U.S.C. Section 1842(b)), the commissioner

shall state in writing within the period prescribed by that

subsection the commissioner's:

(1) views and recommendations concerning the proposed

transaction;

(2) opinion regarding whether the proposed transaction complies

with this chapter and the Interstate Banking and Branching

Efficiency Act; and

(3) opinion regarding whether the proposed transaction complies

with the Community Reinvestment Act of 1977 (12 U.S.C. Section

2901 et seq.), as amended.

(d) The commissioner is not required to disapprove the

application or notice solely because of the opinion stated under

Subsection (c)(3).

(e) If the commissioner's response disapproves an application

for or notice of an acquisition of a Texas state bank or a Texas

bank holding company controlling a Texas state bank, the

commissioner may:

(1) appear at the hearing held as provided by Section 3(b), Bank

Holding Company Act (12 U.S.C. Section 1842(b)); and

(2) present evidence at the hearing regarding the reasons the

application or notice should be denied.

(f) If the commissioner's response disapproves an application

for or notice of an acquisition other than as described by

Subsection (e), the commissioner may request that a hearing be

held as provided by Section 3(b), Bank Holding Company Act (12

U.S.C. Section 1842(b)). If the board of governors grants the

request, the commissioner shall appear and present evidence at

the hearing regarding the reasons the application or notice

should be denied.

(g) If the board of governors approves an application or notice

that the commissioner disapproved, the commissioner may accept

the decision or attempt to overturn the decision on appeal as

provided by Section 9, Bank Holding Company Act (12 U.S.C.

Section 1848).

Added by Acts 1999, 76th Leg., ch. 344, Sec. 1.001, eff. Sept. 1,

1999.

Sec. 202.002. LIMITATION ON CONTROL OF DEPOSITS. (a) The

commissioner may not approve an acquisition if, on consummation

of the transaction, the applicant, including all depository

institution affiliates of the applicant, would control 20 percent

or more of the total amount of deposits in this state held by

depository institutions in this state.

(b) The commissioner may request and the applicant shall provide

supplemental information to the 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.

Added by Acts 1999, 76th Leg., ch. 344, Sec. 1.001, eff. Sept. 1,

1999.

Sec. 202.003. REQUIRED AGE OF ACQUIRED BANK. (a) An

out-of-state bank holding company may not make an acquisition

under this chapter if the Texas bank to be acquired, or any Texas

bank subsidiary of the bank holding company to be acquired, has

not been in existence and in continuous operation for at least

five years as of the effective date of acquisition.

(b) For purposes of this section:

(1) a bank that is the successor as a result of merger or

acquisition of all or substantially all of the assets of a prior

bank is considered to have been in existence and continuously

operated during the period of its existence and continuous

operation as a bank and during the period of existence and

continuous operation of the prior bank; and

(2) a bank effecting a purchase and assumption, merger, or

similar transaction with or supervised by the Federal Deposit

Insurance Corporation or its successor is considered to have been

in existence and continuously operated during the existence and

continuous operation of the bank with respect to which the

transaction was consummated.

Added by Acts 1999, 76th Leg., ch. 344, Sec. 1.001, eff. Sept. 1,

1999.

Sec. 202.004. NONBANKING ACQUISITION, ELECTION, OR ACTIVITY.

(a) A bank holding company doing business in this state that

submits an application, election, or notice to the Board of

Governors of the Federal Reserve System under Section 4, Bank

Holding Company Act (12 U.S.C. Section 1843), that involves or

will involve an office location in this state shall submit to the

commissioner a copy of the application, election, or notice when

the application, election, or notice is submitted to the board of

governors, including a notice or application to acquire a

nonbanking institution, an election to be treated as a financial

holding company, or a request, proposal, or application to engage

in an activity that is or may be a financial activity or an

activity incidental or complementary to a financial activity. The

bank holding company shall submit other information reasonably

requested by the commissioner to determine the manner in which

the acquisition, election, or activity will directly or

indirectly affect residents of this state.

(b) To assist in determining whether to disapprove the proposed

acquisition, election, or activity, the commissioner may hold a

public hearing as provided by Section 31.201, regardless of

whether requested to do so by a person, regarding the proposed

acquisition, election, or activity and its effect on this state.

The commissioner shall convene a hearing if the bank holding

company requests a hearing in writing when it submits the

application, election, or notice to the commissioner.

election, or activity if the commissioner determines that the

acquisition, election, or activity would be detrimental to the

public interest as a result of probable adverse effects,

including undue concentration of resources, decreased or unfair

competition, conflicts of interest, or unsound banking practices.

(d) If the commissioner determines to disapprove the proposed

acquisition, election, or activity, the commissioner may prepare

and file a response to the application, election, or notice with

the board of governors and may request that a hearing be held. If

the board of governors grants the request, the commissioner shall

appear and present evidence at the hearing regarding the reasons

the proposed acquisition, election, or activity should be denied.

(e) If the board of governors approves a proposed acquisition,

election, or activity that the commissioner disapproved, the

commissioner may accept the decision or seek to overturn the

decision on appeal as provided by Section 9, Bank Holding Company

Act (12 U.S.C. Section 1848).

Added by Acts 1999, 76th Leg., ch. 344, Sec. 1.001, eff. Sept. 1,

1999. Amended by Acts 2001, 77th Leg., ch. 528, Sec. 30, eff.

Sept. 1, 2001.

Sec. 202.005. APPLICABLE LAWS. (a) The commissioner may:

(1) examine a bank holding company that controls a Texas bank to

the same extent as if the bank holding company were a Texas state

bank; and

(2) bring an enforcement proceeding under Chapter 35 against a

bank holding company that violates or participates in a violation

of Subtitle A, an agreement filed with the commissioner under

this chapter, or a rule adopted by the finance commission or

order issued by the commissioner under Subtitle A, as if the bank

holding company were a Texas state bank.

(b) A Texas bank that is controlled by a bank holding company

that is not a Texas bank holding company shall be subject to all

laws of this state that are applicable to Texas banks that are

controlled by Texas bank holding companies.

Added by Acts 1999, 76th Leg., ch. 344, Sec. 1.001, eff. Sept. 1,

1999. Amended by Acts 2001, 77th Leg., ch. 867, Sec. 94, eff.

Sept. 1, 2001.

Amended by:

Acts 2007, 80th Leg., R.S., Ch.

237, Sec. 77, eff. September 1, 2007.

Sec. 202.006. FINANCIAL ACTIVITIES. (a) A financial holding

company may engage in a financial activity or an activity

incidental or complementary to a financial activity if the

activity has been authorized by:

(1) the Board of Governors of the Federal Reserve System under

12 U.S.C. Section 1843(k); or

(2) a rule adopted by the finance commission under Subsection

(b).

(b) The finance commission by rule may determine that an

activity not otherwise approved or authorized under this chapter,

federal law, or other law is:

(1) a financial activity;

(2) incidental to a financial activity; or

(3) complementary to a financial activity.

commission shall consider:

(1) the purposes of this subtitle and the Gramm-Leach-Bliley Act

(Pub. L. No. 106-102);

(2) changes or reasonably expected changes in the marketplace in

which financial holding companies compete;

(3) changes or reasonably expected changes in the technology for

delivering financial services;

(4) whether the activity is necessary or appropriate to allow a

financial holding company to:

(A) compete effectively with another company seeking to provide

financial services;

(B) efficiently deliver information and services that are

financial in nature through the use of technological means,

including an application necessary to protect the security or

efficacy of systems for the transmission of data or financial

transactions; or

for using financial services or for the document imaging of data;

and

(5) if otherwise determined to be permissible, whether the

conduct of the activity by a financial holding company should be

qualified through the imposition of reasonable and necessary

conditions to protect the public and require appropriate regard

for safety and soundness of the holding company's subsidiary

banks and the financial system generally.

(d) A determination by the board of governors under federal law

or by a rule of the finance commission under this section does

not alter or negate applicable licensing and regulatory

requirements administered by a functional regulatory agency of

this state.

Added by Acts 2001, 77th Leg., ch. 528, Sec. 31, eff. Sept. 1,

2001.

State Codes and Statutes

State Codes and Statutes

State Codes and Statutes

State Codes and Statutes

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