By: Zaffirini S.B. No. 1900
(In the Senate - Filed March 12, 2021; March 26, 2021, read
first time and referred to Committee on Business & Commerce;
April 8, 2021, reported favorably by the following vote: Yeas 9,
Nays 0; April 8, 2021, sent to printer.)
Click here to see the committee vote
A BILL TO BE ENTITLED
AN ACT
relating to the regulatory authority of the savings and mortgage
lending commissioner; authorizing fees.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 92.554(a), Finance Code, is amended to
read as follows:
(a) On receipt of an application, the commissioner shall
submit to the Texas Register for publication in the next issue after
the date the application is received or publish in a newspaper of
general circulation that is printed in English in the county in
which the savings bank is to have the savings bank's principal
office:
(1) notice of the application;
(2) the date the application was filed; and
(3) the identity of each party to the application.
SECTION 2. Subchapter B, Chapter 96, Finance Code, is
amended by adding Section 96.0551 to read as follows:
Sec. 96.0551. REGULATION AND EXAMINATION OF CERTAIN RELATED
ENTITIES. (a) In this section, "state savings bank" has the
meaning assigned by Section 31.002.
(b) The commissioner may regulate and examine, to the same
extent as if the services or activities were performed by a state
savings bank on its own premises:
(1) the activities of a state savings bank affiliate;
and
(2) the services or activities of a third-party
service provider that a state savings bank or state savings bank
affiliate has contracted for or otherwise arranged to be performed
on behalf of the state savings bank or state savings bank affiliate.
(c) The commissioner may collect a fee from an examined
third-party service provider or affiliate in connection with each
examination to cover the cost of the examination or may collect that
fee from the state savings banks that use the examined third-party
service provider.
(d) For purposes of this section, a state savings bank
affiliate does not include a company in which ownership or
membership is limited to individuals and conditioned by law on the
existence and maintenance of professional licensing.
(e) To promote regulatory efficiency, if, in the preceding
24 months, a third-party service provider or affiliate has been
examined by a federal or state financial services regulatory agency
or by a member agency of the Federal Financial Institutions
Examination Council, or its successor agency, the commissioner may
accept the results of that examination instead of conducting the
commissioner's own examination of the third-party service provider
or affiliate. Nothing in this subsection shall be construed as
limiting or restricting the commissioner from participating in an
examination of a third-party service provider or affiliate
conducted by a federal or state financial services regulatory
agency or by a member agency of the Federal Financial Institutions
Examination Council, or its successor agency.
(f) A third-party service provider that refuses to submit to
examination or to pay an assessed fee for examination under this
section is subject to an enforcement action under Chapter 96. With
respect to a third-party service provider's refusal to submit to
examination, the commissioner may notify all state savings banks of
the refusal and warn that continued use of the third-party service
provider may constitute an unsafe and unsound banking practice.
SECTION 3. Section 97.006, Finance Code, is amended by
adding Subsections (f), (g), and (h) to read as follows:
(f) The commissioner may:
(1) examine a holding company that controls a state
savings bank to the same extent as if the holding company were a
state savings bank; and
(2) bring an enforcement action under Chapter 96
against a holding company described by Subdivision (1) or other
person that violates or participates in a violation of this
subtitle, an agreement filed with the commissioner under this
chapter, or a rule adopted by the finance commission or order issued
by the commissioner under this subtitle, as if the holding company
were a state savings bank.
(g) The grounds, procedures, and effects of an enforcement
action brought under Subsection (f) apply to a holding company, an
officer, director, or employee of a holding company, or a
controlling shareholder or other person participating in the
affairs of a holding company in the same manner as the grounds,
procedures, and effects apply to a state savings bank, an officer,
director, or employee of a state savings bank, or a controlling
shareholder or other person participating in the affairs of a state
savings bank.
(h) A state savings bank that is controlled by a holding
company that is not a Texas holding company shall be subject to all
laws of this state that are applicable to state savings banks that
are controlled by Texas holding companies.
SECTION 4. Section 156.2041(a), Finance Code, is amended to
read as follows:
(a) To be issued a mortgage company license, an applicant
must:
(1) submit a completed application together with the
payment of applicable fees through the Nationwide Mortgage
Licensing System and Registry;
(2) designate control persons for the mortgage company
through the Nationwide Mortgage Licensing System and Registry;
(3) designate an individual licensed as a residential
mortgage loan originator under Chapter 157 as the company's
qualifying individual;
(4) submit a completed branch application through the
Nationwide Mortgage Licensing System and Registry for each branch
office that engages in residential mortgage loan activity on
residential real estate located in this state;
(5) not be in violation of this chapter, a rule adopted
under this chapter, or any order previously issued by the
commissioner to the applicant;
(6) have the company name or assumed name properly
filed with either the secretary of state or with the appropriate
county clerk's office; and
(7) [maintain a physical office in this state; and
[(8)] provide financial statements and any other
information required by the commissioner.
SECTION 5. Section 156.2042(a), Finance Code, is amended to
read as follows:
(a) To be issued a credit union subsidiary organization
license, an applicant must:
(1) submit a completed application together with the
payment of applicable fees through the Nationwide Mortgage
Licensing System and Registry;
(2) designate control persons for the organization
through the Nationwide Mortgage Licensing System and Registry;
(3) designate an individual licensed as a residential
mortgage loan originator under Chapter 157 as the company's
qualifying individual;
(4) submit a completed branch application through the
Nationwide Mortgage Licensing System and Registry for each branch
office that engages in residential mortgage loan activity on
residential real estate located in this state; and
(5) not be in violation of this chapter, a rule adopted
under this chapter, or any order previously issued by the
commissioner to the applicant[; and
[(6) maintain a physical office in this state].
SECTION 6. Section 156.501(c), Finance Code, is amended to
read as follows:
(c) Amounts in the recovery fund may be invested and
reinvested in accordance with Chapter 2256, Government Code, and
under the prudent person standard described by Section 11b, Article
VII, Texas Constitution [in the same manner as funds of the
Employees Retirement System of Texas], and the interest from these
investments shall be deposited to the credit of the fund. An
investment may not be made under this subsection if the investment
will impair the necessary liquidity required to satisfy judgment
payments awarded under this subchapter.
SECTION 7. The following provisions of the Finance Code are
repealed:
(1) Sections 156.212(a) and (a-1);
(2) Sections 156.501(d) and (f); and
(3) Section 156.502(b).
SECTION 8. Section 92.554(a), Finance Code, as amended by
this Act, applies only to an application filed on or after the
effective date of this Act. An application filed before the
effective date of this Act is governed by the law in effect on the
date the application was filed, and the former law is continued in
effect for that purpose.
SECTION 9. Section 156.501(c), Finance Code, as amended by
this Act, applies only to an investment made on or after the
effective date of this Act. An investment made before the effective
date of this Act is governed by the law in effect on the date the
investment was made, and the former law is continued in effect for
that purpose.
SECTION 10. This Act takes effect September 1, 2021.
* * * * *