| 1 | | - | By: Slawson, Anchia (Senate Sponsor - Paxton) H.B. No. 3850 |
|---|
| 2 | | - | (In the Senate - Received from the House April 26, 2021; |
|---|
| 3 | | - | May 4, 2021, read first time and referred to Committee on Business & |
|---|
| 4 | | - | Commerce; May 20, 2021, reported favorably by the following vote: |
|---|
| 5 | | - | Yeas 9, Nays 0; May 20, 2021, sent to printer.) |
|---|
| 6 | | - | Click here to see the committee vote |
|---|
| 1 | + | 87R14632 SRA-F |
|---|
| 2 | + | By: Slawson, Anchia H.B. No. 3850 |
|---|
| 7 | 3 | | |
|---|
| 8 | 4 | | |
|---|
| 9 | 5 | | A BILL TO BE ENTITLED |
|---|
| 10 | 6 | | AN ACT |
|---|
| 11 | 7 | | relating to the regulation of state banks. |
|---|
| 12 | 8 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
|---|
| 13 | 9 | | SECTION 1. Section 34.103(c), Finance Code, is amended to |
|---|
| 14 | 10 | | read as follows: |
|---|
| 15 | 11 | | (c) A state bank may not establish or acquire a subsidiary |
|---|
| 16 | 12 | | or a controlling interest in a subsidiary that engages in |
|---|
| 17 | 13 | | activities as principal in which the bank is prohibited from |
|---|
| 18 | 14 | | engaging directly unless: |
|---|
| 19 | 15 | | (1) the state bank's investment in the subsidiary has |
|---|
| 20 | 16 | | been allowed [approved] by the Federal Deposit Insurance |
|---|
| 21 | 17 | | Corporation under Section 24, Federal Deposit Insurance Act (12 |
|---|
| 22 | 18 | | U.S.C. Section 1831a); or |
|---|
| 23 | 19 | | (2) with respect to a subsidiary engaged in activities |
|---|
| 24 | 20 | | as principal that a national bank may conduct only through a |
|---|
| 25 | 21 | | financial subsidiary, including firm underwriting of equity |
|---|
| 26 | 22 | | securities other than as permitted by Section 34.101, and not |
|---|
| 27 | 23 | | otherwise engaged in activities as principal that are impermissible |
|---|
| 28 | 24 | | for a state bank or a financial subsidiary of a national bank, the |
|---|
| 29 | 25 | | subsidiary's activities and the bank's investment are in compliance |
|---|
| 30 | 26 | | with the restrictions and requirements of Section 46, Federal |
|---|
| 31 | 27 | | Deposit Insurance Act (12 U.S.C. Section 1831w). |
|---|
| 32 | 28 | | SECTION 2. Section 35.002(a), Finance Code, is amended to |
|---|
| 33 | 29 | | read as follows: |
|---|
| 34 | 30 | | (a) The banking commissioner has grounds to issue a cease |
|---|
| 35 | 31 | | and desist order to a current or former [an] officer, employee, or |
|---|
| 36 | 32 | | director of a state bank, or the bank itself acting through an |
|---|
| 37 | 33 | | authorized person, if the banking commissioner determines from |
|---|
| 38 | 34 | | examination or other credible evidence that the bank or person |
|---|
| 39 | 35 | | directly or indirectly has: |
|---|
| 40 | 36 | | (1) violated this subtitle or another applicable law; |
|---|
| 41 | 37 | | (2) engaged in a breach of trust or other fiduciary |
|---|
| 42 | 38 | | duty; |
|---|
| 43 | 39 | | (3) refused to submit to examination or examination |
|---|
| 44 | 40 | | under oath; |
|---|
| 45 | 41 | | (4) conducted business in an unsafe or unsound manner; |
|---|
| 46 | 42 | | or |
|---|
| 47 | 43 | | (5) violated a condition of the bank's charter or an |
|---|
| 48 | 44 | | agreement between the bank or the person and the banking |
|---|
| 49 | 45 | | commissioner or the department. |
|---|
| 50 | 46 | | SECTION 3. Section 35.002(a), Finance Code, as amended by |
|---|
| 51 | 47 | | this Act, applies only to a violation that occurs on or after the |
|---|
| 52 | 48 | | effective date of this Act. A violation that occurs before the |
|---|
| 53 | 49 | | effective date of this Act is governed by the law in effect when the |
|---|
| 54 | 50 | | violation occurred, and the former law is continued in effect for |
|---|
| 55 | 51 | | that purpose. |
|---|
| 56 | 52 | | SECTION 4. This Act takes effect September 1, 2021. |
|---|