Tennessee Senate Bill SB1293

Tennessee 2023-2024 Regular Session

• Introduced: 1/31/23
• Engrossed: 3/4/24
• Enrolled: 4/3/24
• Passed: 4/11/24
• Chaptered: 4/17/24

Caption

AN ACT to amend Tennessee Code Annotated, Title 45, relative to financial institutions.

Impact

The impact of SB 1293 is significant as it seeks to tighten regulations surrounding the ownership and operation of banks and savings institutions in Tennessee. By outlining clear guidelines for acquisition and ownership, the bill aims to protect local consumers by ensuring that only qualified financial institutions engage in banking activities. These amendments could lead to a more stable financial ecosystem, potentially reducing the risks associated with the operation of financial entities that do not meet these specific criteria. Furthermore, it emphasizes the importance of local financial institutions in the Tennessee economy.

Summary

Senate Bill 1293 aims to amend the Tennessee Code Annotated, specifically targeting regulations related to financial institutions. The primary provisions involve the conditions under which banking institutions and savings institutions may be acquired or controlled. The bill establishes criteria that stipulate that only those institutions eligible to accept deposits and make commercial loans within the state can be controlled by a holding entity. This provision seeks to ensure that all banking entities maintain stable deposit operations and contribute effectively to the commercial lending landscape within Tennessee.

Sentiment

The sentiment surrounding SB 1293 appears to be largely supportive, particularly among legislators who prioritize the integrity of the state's banking system. The bill's advocates argue that it enhances consumer protection by preventing unqualified entities from taking control of banks. However, some may express concerns regarding the implications for expanding financial services and the flexibility of banking operations, as tighter regulations may inhibit potential innovations or mergers within the sector.

Contention

One notable point of contention arising from SB 1293 is the debate over the balance between regulation and free market principles. While supporters advocate for stringent measures to secure consumer assets and ensure stable financial practices, opponents could argue that the regulations might impede the growth and adaptability of financial institutions in Tennessee. The bill's passage signifies an ongoing conversation about the governance of financial institutions and the extent to which state legislators should dictate business operations and ownership structures.