Texas 2013 - 83rd Regular

Texas Senate Bill SB805 Compare Versions

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1	1	By: Carona S.B. No. 805
2	2	(In the Senate - Filed February 25, 2013; March 5, 2013,
3	3	read first time and referred to Committee on Business and Commerce;
4	4	March 13, 2013, reported favorably by the following vote: Yeas 8,
5	5	Nays 0; March 13, 2013, sent to printer.)
6	6
7	7
8	8	A BILL TO BE ENTITLED
9	9	AN ACT
10	10	relating to the regulation of banks, trust companies, and bank
11	11	holding companies.
12	12	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
13	13	SECTION 1. Subsection (c), Section 11.107, Finance Code, is
14	14	amended to read as follows:
15	15	(c) The presiding officer may:
16	16	(1) adopt rules and procedures as the presiding
17	17	officer considers necessary for the orderly operation of the
18	18	finance commission and for communication among the finance
19	19	commission, the Texas Department of Banking [department], the
20	20	Department of Savings and Mortgage Lending, and the Office of
21	21	Consumer Credit Commissioner;
22	22	(2) adopt internal procedures governing the time and
23	23	place of meetings, the type of notice for special public meetings,
24	24	the manner in which public meetings are to be conducted, and other
25	25	similar matters; and
26	26	(3) appoint committees composed of finance commission
27	27	members as the presiding officer considers necessary to carry out
28	28	the commission's business.
29	29	SECTION 2. Subdivision (8), Subsection (a), Section 31.002,
30	30	Finance Code, is amended to read as follows:
31	31	(8) "Branch" means a location of a bank, other than the
32	32	bank's home office, at which the bank engages the public in the
33	33	business of banking. The term does not include:
34	34	(A) a drive-in facility located not more than
35	35	2,000 feet from the nearest wall of the home office or an approved
36	36	branch office of the bank;
37	37	(B) a night depository;
38	38	(C) an electronic terminal;
39	39	(D) a deposit or loan production office as
40	40	described by Section 32.204;
41	41	(E) a state or federally licensed armored car
42	42	service or other courier service transporting items for deposit or
43	43	payment, unless:
44	44	(i) the risk of loss of items in the custody
45	45	of the service is borne by the employing bank; or
46	46	(ii) the items in the custody of the service
47	47	are considered to be in customer accounts at the employing bank or
48	48	federally insured through the employing bank;
49	49	(F) a location at which the bank offers
50	50	exclusively nondepository financial products or services to the
51	51	public, including financial, investment, or economic advisory
52	52	services;
53	53	(G) a location that combines permissible
54	54	non-branch functions or facilities; or
55	55	(H) another office or facility as provided by
56	56	this subtitle or a rule adopted under this subtitle.
57	57	SECTION 3. Section 31.105, Finance Code, is amended by
58	58	amending Subsections (c) and (d) and adding Subsections (c-1) and
59	59	(e) to read as follows:
60	60	(c) The banking commissioner may:
61	61	(1) administer oaths and examine persons under oath on
62	62	any subject that the commissioner considers pertinent to the
63	63	financial condition or the safety and soundness of the activities
64	64	of a state bank; and
65	65	(2) subpoena witnesses and require and compel by
66	66	subpoena the production of documents not voluntarily produced.
67	67	(c-1) If a person refuses to obey a subpoena, a district
68	68	court of Travis County, on application by the banking commissioner,
69	69	may issue an order requiring the person to appear before the
70	70	commissioner and produce documents or give evidence regarding the
71	71	matter under examination or investigation.
72	72	(d) Disclosure of information to the banking commissioner
73	73	pursuant to an examination request or a subpoena issued under this
74	74	section does not constitute a waiver of or otherwise affect or
75	75	diminish an evidentiary privilege to which the information is
76	76	otherwise subject. A report of an examination under this section
77	77	is confidential and may be disclosed only under the circumstances
78	78	provided by this subtitle.
79	79	(e) A subpoena issued to a financial institution under this
80	80	section is not subject to Section 59.006.
81	81	SECTION 4. Section 32.204, Finance Code, is amended to read
82	82	as follows:
83	83	Sec. 32.204. DEPOSIT OR LOAN PRODUCTION OFFICES. (a) A
84	84	state bank may establish one or more deposit or loan production
85	85	offices for the purpose of:
86	86	(1) soliciting deposit accounts, applications for
87	87	loans, or equivalent transactions;
88	88	(2) [, accepting loan applications, and] performing
89	89	ministerial duties related to solicitations described by
90	90	Subdivision (1); and
91	91	(3) conducting other activities as permitted by rules
92	92	adopted under this subtitle [consummating a granted loan, such as
93	93	execution of loan documents and dispensation of loan proceeds by
94	94	check or other draft, including a certified or cashier's check, but
95	95	not by cash. A credit decision, commitment to make a loan, and
96	96	preparation of a check or other draft to dispense loan proceeds must
97	97	occur at the bank's home office or a branch office and may not occur
98	98	at a loan production office].
99	99	(b) The bank shall notify the banking commissioner in
100	100	writing of the location of and activities to be conducted at a
101	101	proposed deposit or loan production office of the bank. The bank
102	102	may establish the proposed office beginning on the 31st day after
103	103	the date [before the 31st day before the date of establishment of a
104	104	loan production office, except that] the banking commissioner
105	105	receives the bank's notice unless [may waive or shorten the period
106	106	if] the banking commissioner specifies that the proposed office be
107	107	established on an earlier or later date.
108	108	(c) The banking commissioner may extend the 30-day period
109	109	prescribed by Subsection (b) on a determination that the bank's
110	110	notice raises issues that require additional information or time
111	111	for analysis. If the period is extended, [does not have a
112	112	significant supervisory or regulatory concern regarding] the bank
113	113	may establish the proposed deposit or [its planned] loan production
114	114	office only with the prior written approval of the banking
115	115	commissioner.
116	116	SECTION 5. Section 33.104, Finance Code, is amended to read
117	117	as follows:
118	118	Sec. 33.104. ADVISORY DIRECTOR. (a) An advisory director
119	119	is not considered a director if the advisory director:
120	120	(1) is not elected by the shareholders of the bank;
121	121	(2) does not vote on matters before the board or a
122	122	committee of the board;
123	123	(3) is not counted for purposes of determining a
124	124	quorum of the board or committee; and
125	125	(4) provides solely general policy advice to the
126	126	board.
127	127	(b) A state bank may not disclose to an advisory director
128	128	confidential information pertaining to the bank or the bank's
129	129	customers unless:
130	130	(1) the board adopts a resolution that designates the
131	131	advisory director as a person who is officially connected to the
132	132	bank and that describes the purpose for disclosure of the
133	133	information, which must be a reasonable business purpose; and
134	134	(2) the disclosure is made under a written
135	135	confidentiality agreement between the bank and the advisory
136	136	director.
137	137	SECTION 6. Section 33.105, Finance Code, is amended to read
138	138	as follows:
139	139	Sec. 33.105. REQUIRED MONTHLY BOARD MEETING. (a) Except
140	140	as provided by Subsection (b), the [The] board of a state bank shall
141	141	hold at least one regular meeting each month.
142	142	(b) On application by the board, the banking commissioner
143	143	may grant the board approval to hold regular meetings on a less
144	144	frequent basis than the period prescribed by Subsection (a). The
145	145	commissioner may revoke or modify a prior approval granted under
146	146	this subsection if the commissioner determines that more frequent
147	147	regular meetings of the board are necessary to promote the safety
148	148	and soundness of the bank.
149	149	(c) At each regular meeting the board shall review and
150	150	approve the minutes of the prior meeting and review the operations,
151	151	activities, and financial condition of the bank. The board may
152	152	designate a committee from among its members to perform those
153	153	duties and approve or disapprove the committee's report at each
154	154	regular meeting. Each action of the board must be recorded in its
155	155	minutes.
156	156	SECTION 7. Subsection (c), Section 34.003, Finance Code, is
157	157	amended to read as follows:
158	158	(c) A state bank shall dispose of real property subject to
159	159	this section not later than[:
160	160	[(1)] the fifth anniversary of the date the real
161	161	property:
162	162	(1) [(A) it] was acquired except as otherwise
163	163	provided by rules adopted under this subtitle; [or]
164	164	(2) [(B) it] ceases to be used as a bank facility; or
165	165	(3) [(2) the second anniversary of the date it]
166	166	ceases to be a bank facility as provided by Section 34.002(b).
167	167	SECTION 8. Section 34.004, Finance Code, is amended to read
168	168	as follows:
169	169	Sec. 34.004. RETENTION OF NONPARTICIPATING ROYALTY
170	170	[PASSIVE INVESTMENT IN MINERAL] INTERESTS. (a) Notwithstanding
171	171	Section 34.003(a), a state bank may hold nonparticipating
172	172	[nonworking mineral or] royalty interests if:
173	173	(1) the state bank acquires the interest pursuant to
174	174	Section 34.003(a)(3) or retains the interest in a sale of property
175	175	acquired under that section;
176	176	(2) the interest is nonparticipating due to the fact
177	177	the interest:
178	178	(A) is nonpossessory;
179	179	(B) does not bear executive rights, the right of
180	180	ingress and egress, the right to receive bonus payments, or the
181	181	right to receive delay rentals; and
182	182	(C) is accordingly not subject to expenses of
183	183	exploration, development, production, operation, maintenance, or
184	184	abandonment, or [any] other expenses [expense] associated with
185	185	extracting and marketing the minerals subject to the [rights or]
186	186	interest;
187	187	(3) the interest is reasonably valued on the books of
188	188	the state bank for not more than a nominal amount, and the aggregate
189	189	amount of earnings from such interests is separately disclosed in
190	190	the annual financial statements of the state bank;
191	191	(4) the state bank does not make any new investments
192	192	relating to the [rights or] interests without the approval of the
193	193	banking commissioner; and
194	194	(5) the banking commissioner determines that the
195	195	possession of such [rights and] interests is not inconsistent with
196	196	the safety and soundness of the state bank.
197	197	(b) The banking commissioner may order a state bank that
198	198	holds nonparticipating [nonworking mineral or] royalty interests
199	199	to divest such interests at any time if the banking commissioner
200	200	determines that continued ownership of such interests is
201	201	detrimental to the state bank.
202	202	(c) Subject to compliance with this section,
203	203	nonparticipating [nonworking mineral or] royalty interests are not
204	204	considered to be real property for purposes of this subtitle.
205	205	SECTION 9. Subsection (b), Section 35.003, Finance Code, is
206	206	amended to read as follows:
207	207	(b) If the banking commissioner has grounds for action under
208	208	Subsection (a) and finds that a removal or prohibition order
209	209	appears to be necessary and in the best interest of the public [bank
210	210	involved and its depositors, creditors, or shareholders], the
211	211	banking commissioner may serve a proposed removal or prohibition
212	212	order, as appropriate, on a person alleged to have committed or
213	213	participated in the action. The proposed order must:
214	214	(1) be delivered by personal delivery or by registered
215	215	or certified mail, return receipt requested;
216	216	(2) state with reasonable certainty the grounds for
217	217	removal or prohibition;
218	218	(3) state the effective date of the order, which may
219	219	not be before the 21st day after the date the proposed order is
220	220	delivered or mailed; and
221	221	(4) state the duration of the order, including whether
222	222	the duration of the order is perpetual.
223	223	SECTION 10. Section 35.106, Finance Code, is amended to
224	224	read as follows:
225	225	Sec. 35.106. AUTHORITY OF SUPERVISOR. During a period of
226	226	supervision, a bank, without the prior approval of the banking
227	227	commissioner or the supervisor or as otherwise permitted or
228	228	restricted by the order of supervision, may not:
229	229	(1) dispose of, sell, transfer, convey, or encumber
230	230	the bank's assets;
231	231	(2) lend or invest the bank's money;
232	232	(3) incur a debt, obligation, or liability; [or]
233	233	(4) pay a cash dividend to the bank's shareholders; or
234	234	(5) remove an executive officer or director, change
235	235	the number of executive officers or directors, or have any other
236	236	change in the position of executive officer or director.
237	237	SECTION 11. Subsection (a), Section 181.002, Finance Code,
238	238	is amended by adding Subdivision (47-a) to read as follows:
239	239	(47-a) "Surplus" means the amount by which the assets
240	240	of a state trust company exceed the company's liabilities, capital,
241	241	and undivided profits.
242	242	SECTION 12. Section 181.104, Finance Code, is amended by
243	243	amending Subsections (d) and (f) and adding Subsections (f-1) and
244	244	(g) to read as follows:
245	245	(d) Disclosure of information to the banking commissioner
246	246	pursuant to an examination request or a subpoena issued under this
247	247	section does not constitute a waiver of or otherwise affect or
248	248	diminish an evidentiary privilege to which the information is
249	249	otherwise subject. A report of an examination under this section is
250	250	confidential and may be disclosed only under the circumstances
251	251	provided by this subtitle.
252	252	(f) The banking commissioner may:
253	253	(1) administer oaths and examine persons under oath on
254	254	any subject that the banking commissioner considers pertinent to
255	255	the financial condition or the safety and soundness of the
256	256	activities of a state trust company; and
257	257	(2) subpoena witnesses and require and compel by
258	258	subpoena the production of documents not voluntarily produced.
259	259	(f-1) If a person refuses to obey a subpoena, a district
260	260	court of Travis County, on application by the banking commissioner,
261	261	may issue an order requiring the person to appear before the
262	262	commissioner and produce documents or give evidence regarding the
263	263	matter under examination or investigation.
264	264	(g) A subpoena issued to a financial institution under this
265	265	section is not subject to Section 59.006.
266	266	SECTION 13. Section 183.104, Finance Code, is amended to
267	267	read as follows:
268	268	Sec. 183.104. ADVISORY DIRECTOR OR ADVISORY MANAGER.
269	269	(a) An advisory director or advisory manager is not considered to
270	270	be a director if the advisory director or advisory manager:
271	271	(1) is not elected by the shareholders or participants
272	272	of the state trust company;
273	273	(2) does not vote on matters before the board or a
274	274	committee of the board;
275	275	(3) is not counted for purposes of determining a
276	276	quorum of the board or committee; and
277	277	(4) provides solely general policy advice to the
278	278	board.
279	279	(b) A state trust company may not disclose to an advisory
280	280	director or advisory manager confidential information pertaining
281	281	to the state trust company or the company's clients unless:
282	282	(1) the board adopts a resolution that designates the
283	283	advisory director or advisory manager as a person who is officially
284	284	connected to the trust company and that describes the purpose for
285	285	disclosure of the information, which must be a reasonable business
286	286	purpose; and
287	287	(2) the disclosure is made under a written
288	288	confidentiality agreement between the state trust company and the
289	289	advisory director or advisory manager.
290	290	SECTION 14. Subsections (a) and (c), Section 184.002,
291	291	Finance Code, are amended to read as follows:
292	292	(a) Without the prior written approval of the banking
293	293	commissioner, a state trust company may not directly or indirectly
294	294	invest an amount in excess of the company's [60 percent of its]
295	295	restricted capital in state trust company facilities, furniture,
296	296	fixtures, and equipment. Except as otherwise provided by rules
297	297	adopted under this subtitle, in computing the limitation provided
298	298	by this subsection a state trust company:
299	299	(1) shall include:
300	300	(A) its direct investment in state trust company
301	301	facilities;
302	302	(B) an investment in equity or investment
303	303	securities of a company holding title to a facility used by the
304	304	state trust company for the purposes specified by Section 184.001;
305	305	(C) a loan made by the state trust company to or
306	306	on the security of equity or investment securities issued by a
307	307	company holding title to a facility used by the state trust company;
308	308	and
309	309	(D) any indebtedness incurred on state trust
310	310	company facilities by a company:
311	311	(i) that holds title to the facility;
312	312	(ii) that is an affiliate of the state trust
313	313	company; and
314	314	(iii) in which the state trust company is
315	315	invested in the manner described by Paragraph (B) or (C); and
316	316	(2) may exclude an amount included under Subdivisions
317	317	(1)(B)-(D) to the extent any lease of a facility from the company
318	318	holding title to the facility is capitalized on the books of the
319	319	state trust company.
320	320	(c) A state trust company shall dispose of any real property
321	321	subject to Subsection (a) not later than the fifth anniversary of
322	322	the date the real property:
323	323	(1) was acquired, except as otherwise provided by
324	324	rules adopted under this subtitle;
325	325	(2) ceases to be used as a state trust company
326	326	facility; or
327	327	(3) ceases to be a [comply with regulatory accounting
328	328	principles in accounting for its investment in and depreciation of]
329	329	state trust company facility as provided by Subsection (b)
330	330	[facilities, furniture, fixtures, and equipment].
331	331	SECTION 15. Subsection (b), Section 185.003, Finance Code,
332	332	is amended to read as follows:
333	333	(b) If the banking commissioner has grounds for action under
334	334	Subsection (a) and finds that a removal or prohibition order
335	335	appears to be necessary and in the best interest of the public
336	336	[state trust company involved and its clients, creditors,
337	337	shareholders, or participants], the banking commissioner may serve
338	338	a proposed removal or prohibition order, as appropriate, on an
339	339	officer, employee, director, manager or managing participant,
340	340	controlling shareholder or participant, or other person alleged to
341	341	have committed or participated in the violation or other conduct
342	342	described by Section 185.002(a). The order must:
343	343	(1) be delivered by personal delivery or by registered
344	344	or certified mail, return receipt requested;
345	345	(2) state with reasonable certainty the grounds for
346	346	removal or prohibition;
347	347	(3) state the effective date of the order, which may
348	348	not be before the 21st day after the date the proposed order is
349	349	delivered or mailed; and
350	350	(4) state the duration of the order, including whether
351	351	the duration of the order is perpetual.
352	352	SECTION 16. Section 185.106, Finance Code, is amended to
353	353	read as follows:
354	354	Sec. 185.106. DUTIES OF STATE TRUST COMPANY UNDER
355	355	SUPERVISION. During a period of supervision, a state trust
356	356	company, without the prior approval of the banking commissioner or
357	357	the supervisor or as otherwise permitted or restricted by the order
358	358	of supervision, may not:
359	359	(1) dispose of, sell, transfer, convey, or encumber
360	360	the state trust company's assets;
361	361	(2) lend or invest the state trust company's funds;
362	362	(3) incur a debt, obligation, or liability;
363	363	(4) pay a cash dividend to the state trust company's
364	364	shareholders or participants; [or]
365	365	(5) solicit or accept any new client accounts; or
366	366	(6) remove an executive officer or director, change
367	367	the number of executive officers or directors, or have any other
368	368	change in the position of executive officer or director.
369	369	SECTION 17. Subsection (a), Section 187.103, Finance Code,
370	370	is amended to read as follows:
371	371	(a) An out-of-state trust company that does not operate a
372	372	trust office in this state and that meets the requirements of this
373	373	subchapter may acquire an existing trust institution in this state
374	374	and after the acquisition operate and maintain the acquired
375	375	institution as a trust office in this state, subject to Subchapter
376	376	A, Chapter 183, or Subchapter A, Chapter 33, if applicable. [If the
377	377	institution to be acquired is a bank or a state savings bank,
378	378	Section 203.005 applies to the transaction.]
379	379	SECTION 18. Subsection (a), Section 187.105, Finance Code,
380	380	is amended to read as follows:
381	381	(a) A trust office of an out-of-state trust company may be
382	382	acquired or established in this state under this subchapter if:
383	383	(1) the out-of-state trust company confirms in writing
384	384	to the banking commissioner that while it maintains a trust office
385	385	in this state, it will comply with all applicable laws of this
386	386	state;
387	387	(2) the out-of-state trust company provides
388	388	satisfactory evidence to the banking commissioner of compliance
389	389	with Section 201.102 and the applicable requirements of its home
390	390	state regulator for acquiring or establishing and maintaining the
391	391	office;
392	392	(3) all filing fees have been paid as required by law;
393	393	and
394	394	(4) the banking commissioner finds that:
395	395	(A) applicable conditions of Section 187.102 or
396	396	187.103 have been met;
397	397	(B) if a state bank is being acquired, the
398	398	applicable requirements of Subchapter A, Chapter 33[, and Section
399	399	203.005] have been met, or if a state trust company is being
400	400	acquired, the applicable requirements of Subchapter A, Chapter 183
401	401	have been met; and
402	402	(C) any conditions imposed by the banking
403	403	commissioner pursuant to Subsection (b) have been satisfied.
404	404	SECTION 19. Subdivision (7), Subsection (a), Section
405	405	201.002, Finance Code, is amended to read as follows:
406	406	(7) "Bank supervisory agency" means any of the
407	407	following:
408	408	(A) an agency of another state with primary
409	409	responsibility for chartering and supervising banks;
410	410	(B) the Office of the Comptroller of the
411	411	Currency, the Federal Deposit Insurance Corporation, [or] the Board
412	412	of Governors of the Federal Reserve System, or the Bureau of
413	413	Consumer Financial Protection, and any successor to these agencies;
414	414	or
415	415	(C) an agency of a country, including a colony,
416	416	dependency, possession, or political subdivision of a country,
417	417	other than the United States with primary responsibility for
418	418	chartering and supervising banks.
419	419	SECTION 20. Section 201.004, Finance Code, is amended by
420	420	amending Subsection (a) and adding Subsection (d) to read as
421	421	follows:
422	422	(a) The laws of this state, including laws regarding
423	423	community reinvestment, consumer protection, fair lending, and
424	424	establishment of intrastate branches, apply to an interstate branch
425	425	located in this state to the same extent the laws of this state
426	426	would apply if the branch in this state were a branch of an
427	427	out-of-state national bank [with its main office located] in this
428	428	state, except to the extent otherwise provided under federal law.
429	429	An out-of-state state bank that establishes an interstate branch in
430	430	this state under this subtitle may conduct any activity at the
431	431	branch in this state that is permissible under the laws of the
432	432	bank's home state, to the extent the activity is permissible for a
433	433	Texas state bank or for a branch of an out-of-state national bank in
434	434	this state.
435	435	(d) This subtitle does not limit or affect the authority of:
436	436	(1) the home state regulator of a bank's home state to
437	437	enforce any law applicable to a branch of an out-of-state state
438	438	bank;
439	439	(2) a law enforcement officer, a regulatory
440	440	supervisor, other than the commissioner, or another official of
441	441	this state to enforce the laws of this state applicable to a branch
442	442	of an out-of-state state bank; or
443	443	(3) this state to adopt, apply, or administer any tax
444	444	or method of taxation to a bank, bank holding company, or foreign
445	445	bank, or any affiliate of a bank, bank holding company, or foreign
446	446	bank, to the extent that the tax or tax method is otherwise
447	447	permissible by or under the United States Constitution or other
448	448	federal law.
449	449	SECTION 21. Section 201.005, Finance Code, is amended by
450	450	adding Subsection (c) to read as follows:
451	451	(c) A cooperative agreement entered into by the
452	452	commissioner under this section does not limit the authority of a
453	453	law enforcement officer, regulatory supervisor, or other official
454	454	of this state who is not a party to the agreement to enforce the laws
455	455	of this state applicable to a branch of an out-of-state state bank
456	456	located in this state.
457	457	SECTION 22. Subsection (b), Section 201.009, Finance Code,
458	458	is amended to read as follows:
459	459	(b) If the commissioner determines that an interstate
460	460	branch maintained by an out-of-state state bank in this state is
461	461	being operated in violation of a law of this state that is
462	462	applicable to the branch under Section 24(j), Federal Deposit
463	463	Insurance Act (12 U.S.C. Section 1831a(j)), including a law that
464	464	governs community reinvestment, fair lending, or consumer
465	465	protection [or in an unsafe and unsound manner], the commissioner,
466	466	with written notice to the home state regulator and subject to the
467	467	terms of any applicable cooperative agreement with the home state
468	468	regulator, may take any enforcement action the commissioner would
469	469	be empowered to take if the branch were a Texas state bank or state
470	470	savings bank, as the case may be[, except that the commissioner
471	471	shall promptly give notice to the home state regulator of each
472	472	enforcement action taken against an out-of-state state bank and, to
473	473	the extent practicable, shall consult and cooperate with the home
474	474	state regulator in pursuing and resolving the enforcement action].
475	475	An out-of-state state bank may appeal a final order or other
476	476	decision of the commissioner under this subtitle as provided by
477	477	Sections 31.202, 31.203, and 31.204, or as provided under Subtitle
478	478	C with respect to a state savings bank.
479	479	SECTION 23. Subsection (a), Section 203.002, Finance Code,
480	480	is amended to read as follows:
481	481	(a) An out-of-state bank may establish a de novo branch in
482	482	this state if:
483	483	(1) [the laws of the home state of the out-of-state
484	484	bank would permit a Texas bank to establish and maintain a de novo
485	485	branch in that state under substantially the same terms and
486	486	conditions as set forth in this subchapter;
487	487	[(2)] the out-of-state bank confirms in writing to the
488	488	commissioner that as long as it maintains a branch in this state, it
489	489	will comply with all applicable laws of this state;
490	490	(2) [(3)] the applicant provides satisfactory
491	491	evidence to the commissioner of compliance with the applicable
492	492	requirements of Section 201.102; and
493	493	(3) [(4)] the commissioner, acting on or before the
494	494	30th day after the date the commissioner receives notice of an
495	495	application under Subsection (b), certifies to the responsible
496	496	federal bank supervisory agency that the requirements of this
497	497	subchapter have been met.
498	498	SECTION 24. Subsection (a), Section 203.003, Finance Code,
499	499	is amended to read as follows:
500	500	(a) Subject to Section [Sections] 203.004 [and 203.005],
501	501	one or more Texas banks may enter into an interstate merger
502	502	transaction with one or more out-of-state banks under this chapter,
503	503	and an out-of-state bank resulting from the transaction may
504	504	maintain and operate the branches in this state of a Texas bank that
505	505	participated in the transaction. An out-of-state bank that will be
506	506	the resulting bank in the interstate merger transaction shall
507	507	comply with Section 201.102.
508	508	SECTION 25. Section 203.007, Finance Code, is amended to
509	509	read as follows:
510	510	Sec. 203.007. EXAMINATIONS[; PERIODIC REPORTS]. (a) With
511	511	respect to an interstate branch maintained by an out-of-state state
512	512	bank in this state, the [The] banking commissioner:
513	513	(1) with written notice to the home state regulator
514	514	and subject to the terms of any applicable cooperative agreement
515	515	with the home state regulator, may examine the branch for the
516	516	purpose of determining whether the branch is in [may make
517	517	examinations of a branch established and maintained in this state
518	518	pursuant to this chapter by an out-of-state bank as the banking
519	519	commissioner considers necessary to determine whether the branch is
520	520	being operated in] compliance with the laws of this state that are
521	521	applicable under Section 24(j), Federal Deposit Insurance Act (12
522	522	U.S.C. Section 1831a(j)), including laws governing community
523	523	reinvestment, fair lending, and consumer protection; and
524	524	(2) if expressly permitted under and subject to the
525	525	terms of any cooperative agreement with the home state regulator,
526	526	or if the bank has been determined to be in a troubled condition by
527	527	the home state regulator or the bank's appropriate federal banking
528	528	agency, may participate in the examination of the bank by the home
529	529	state regulator to ascertain whether the activities of the branch
530	530	in this state are being conducted in an unsafe or unsound manner
531	531	[and in accordance with safe and sound banking practices. Sections
532	532	31.105-31.107 or 96.054-96.057, as appropriate, apply to the
533	533	examinations].
534	534	(b) For purposes of this section, a bank is considered to be
535	535	in a troubled condition if the bank:
536	536	(1) has a composite rating, as determined in the bank's
537	537	most recent report of examination, of four or five under the Uniform
538	538	Financial Institutions Ratings System;
539	539	(2) is subject to a proceeding initiated by the
540	540	Federal Deposit Insurance Corporation for termination or
541	541	suspension of deposit insurance; or
542	542	(3) is subject to a proceeding initiated by the home
543	543	state regulator to:
544	544	(A) vacate, revoke, or terminate the bank's
545	545	charter;
546	546	(B) liquidate the bank; or
547	547	(C) appoint a receiver for the bank. [The
548	548	commissioner may prescribe requirements for periodic reports from
549	549	an out-of-state bank that operates a branch in Texas pursuant to
550	550	this chapter. Reporting requirements prescribed by the
551	551	commissioner under this section must be:
552	552	[(1) consistent with the reporting requirements
553	553	applicable to Texas state banks or state savings banks, as
554	554	appropriate; and
555	555	[(2) appropriate to discharge the responsibilities of
556	556	the commissioner under this chapter.]
557	557	SECTION 26. Subsection (c), Section 201.009, Subsection
558	558	(c), Section 203.003, and Section 203.005, Finance Code, are
559	559	repealed.
560	560	SECTION 27. This Act takes effect immediately if it
561	561	receives a vote of two-thirds of all the members elected to each
562	562	house, as provided by Section 39, Article III, Texas Constitution.
563	563	If this Act does not receive the vote necessary for immediate
564	564	effect, this Act takes effect September 1, 2013.
565	565	* * * * *