By Oliveira H.B. No. 1020
74R3127 DWS-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to the regulation of savings banks.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Sections 1.03(1) and (15), Texas Savings Bank Act
1-5 (Article 489e, Vernon's Texas Civil Statutes), are amended to read
1-6 as follows:
1-7 (1) "Administrative procedure act" means Chapter 2001,
1-8 Government Code <the Administrative Procedure and Texas Register
1-9 Act (Article 6252-13a, Vernon's Texas Civil Statutes)>.
1-10 (15) "Financial institution" means a state or federal
1-11 savings bank, a state or federal savings and loan association, <or>
1-12 a state or national bank, or a state or federal credit union.
1-13 SECTION 2. Section 2.05(a), Texas Savings Bank Act (Article
1-14 489e, Vernon's Texas Civil Statutes), is amended to read as
1-15 follows:
1-16 (a) An application to incorporate a savings bank must be in
1-17 a form specified by the commissioner, signed by each incorporator,
1-18 and submitted to the commissioner with the filing fee. An
1-19 application consists of:
1-20 (1) two copies of the proposed articles of
1-21 incorporation setting forth the name of the savings bank, the site
1-22 of the principal office, and the names and addresses of the initial
1-23 directors;
1-24 (2) two copies of the bylaws under which the savings
2-1 bank proposes to operate;
2-2 (3) statements, exhibits, maps, and other data
2-3 sufficiently detailed and comprehensive to enable the commissioner
2-4 to make findings under Section 2.11 of this Act;
2-5 (4) other information relating to the proposed savings
2-6 bank and its operation required by the rules of the commissioner
2-7 and the finance commission; and
2-8 (5) financial information about the applicants,
2-9 incorporators, directors, officers, or stockholders required by the
2-10 rules of the commissioner and the finance commission.
2-11 SECTION 3. Section 2.10, Texas Savings Bank Act (Article
2-12 489e, Vernon's Texas Civil Statutes), is amended by amending
2-13 Subsection (a) and adding Subsection (c) to read as follows:
2-14 (a) When a complete application to incorporate as defined by
2-15 rules adopted by the commissioner and the finance commission is
2-16 filed, the commissioner shall issue public notice of the
2-17 application and shall give any interested party an opportunity to
2-18 appear, present evidence, and be heard for or against the
2-19 application. A hearing officer designated by the commissioner
2-20 shall hold the hearing. A hearing is not required if:
2-21 (1) no party provides written notice to the
2-22 commissioner, before the 11th day after the date of publication of
2-23 the notice of application, of the party's intention to appear and
2-24 present evidence at the hearing; and
2-25 (2) the commissioner finds that the application
2-26 complies with all statutory requirements for approval.
2-27 (c) Not later than the 30th day after the date of the
3-1 completion of a hearing, the commissioner shall enter a final order
3-2 approving or denying the application. An applicant may appeal a
3-3 final order to a district court of Travis County with the
3-4 commissioner as defendant. A party to the action in the district
3-5 court of Travis County may appeal to the appellate court having
3-6 jurisdiction of the cause. The appeal is immediately returnable to
3-7 the appellate court having jurisdiction of the cause, and that
3-8 action has precedence in that appellate court over all causes of a
3-9 different character pending in that court. The commissioner is not
3-10 required to give an appeal bond in a cause arising under this
3-11 section. Filing an appeal under this section does not stay an
3-12 order of the commissioner.
3-13 SECTION 4. Chapter 2, Texas Savings Bank Act (Article 489e,
3-14 Vernon's Texas Civil Statutes), is amended by adding Section 2.15
3-15 to read as follows:
3-16 Sec. 2.15. PREFERENCE FOR LOCAL CONTROL. If more than one
3-17 application to incorporate a new savings bank or establish an
3-18 additional office of an existing savings bank in the same community
3-19 is before the commissioner at the same time, the commissioner may
3-20 give additional weight to the application having the greater degree
3-21 of control vested in or held by residents of the community.
3-22 SECTION 5. Sections 3.07(c) and (g), Texas Savings Bank Act
3-23 (Article 489e, Vernon's Texas Civil Statutes), are amended to read
3-24 as follows:
3-25 (c) The applicant shall pay a filing fee when the applicant
3-26 files an application. A proposal to acquire voting securities of a
3-27 savings bank subject to this section may be made by an individual,
4-1 two or more individuals acting in concert, any type of partnership,
4-2 corporation, syndicate, trust, or any other organization, or any
4-3 combination of those individuals or entities. The information
4-4 required by the commissioner may be required of each member of the
4-5 group, as directed by the commissioner. Notice of the application,
4-6 its date of filing, and the identity of all parties to the
4-7 application shall be submitted to the Texas Register by the
4-8 commissioner on receipt of the application for publication in the
4-9 next issue of the Texas Register following the date the information
4-10 is received, except that the commissioner may waive the requirement
4-11 that a notice be published or permit delay of the publication if
4-12 the commissioner determines that the waiver or delay is in the
4-13 public interest. Information obtained by the commissioner under
4-14 this section, other than published information, is confidential and
4-15 may not be disclosed by the commissioner or any officer or employee
4-16 of the Savings and Loan Department of Texas, except nothing in this
4-17 section prohibits the commissioner from disclosing, on request, the
4-18 identity of the actual or beneficial owner of any savings bank
4-19 chartered under this Act, and the information that would have been
4-20 contained in a published notice that the commissioner waived
4-21 becomes public information under Chapter 552, Government Code, on
4-22 the 34th day after the date the application is filed. The
4-23 commissioner, in the commissioner's discretion and if the
4-24 commissioner deems it necessary or proper in the enforcement of the
4-25 laws of any state or the United States and in the best interest of
4-26 the public, may also divulge information to any appropriate banking
4-27 agency or any appropriate governmental department, agency, or
5-1 instrumentality of this state, another state, or the United States.
5-2 (g) Not later than the 60th day after the date of the filing
5-3 of the application, the commissioner shall approve the application
5-4 without a hearing or notify the proposed transferee in writing of
5-5 the commissioner's intent to deny the application based on the
5-6 requirements of this section. The notice must state the grounds
5-7 for denial. The proposed transferee may file a written request for
5-8 hearing on the application before the 31st day after the date the
5-9 notice of intent to deny is mailed to the proposed transferee. The
5-10 commissioner may immediately enter an order denying the application
5-11 if a hearing is not timely requested, and the order is final and
5-12 nonappealable. If the proposed transferee requests a hearing
5-13 <When the commissioner determines that an application for approval
5-14 of change of control is complete>, the commissioner shall issue
5-15 public notice of the application and shall give any interested
5-16 party an opportunity to appear, present evidence, and be heard for
5-17 or against the application. A hearing officer designated by the
5-18 commissioner shall hold the hearing. After the <A hearing is not
5-19 required if no party provides written notice to the commissioner,
5-20 within 10 days of the date of publication of the notice of
5-21 application, of intention to appear and present evidence at the
5-22 hearing and if the commissioner finds that the application complies
5-23 with all statutory requirements for approval within 30 days after
5-24 the date of the completion of a> hearing, the commissioner shall
5-25 enter a final order either approving or denying the application.
5-26 An applicant may appeal a final order to a district court of Travis
5-27 County with the commissioner as defendant. Either party to the
6-1 action may appeal from the district court of Travis County to the
6-2 appellate court having jurisdiction of the cause. The appeal is at
6-3 once returnable to the appellate court having jurisdiction of the
6-4 cause, and that action has precedence in that appellate court over
6-5 all causes of a different character pending in that court. The
6-6 commissioner is not required to give any appeal bond in any cause
6-7 arising under this section. Filing an appeal under this section
6-8 does not stay an order of the commissioner.
6-9 SECTION 6. Section 4.08, Texas Savings Bank Act (Article
6-10 489e, Vernon's Texas Civil Statutes), is amended to read as
6-11 follows:
6-12 Sec. 4.08. CONFIDENTIALITY. (a) Except as otherwise
6-13 provided by this Act or rules adopted under this Act, the <The>
6-14 commissioner and any examiner, supervisor, conservator, liquidator,
6-15 inspector, deputy, assistant clerk, or other employee of the
6-16 Savings and Loan Department of Texas appointed or acting under this
6-17 Act shall keep confidential any facts or information regarding a
6-18 financial institution or a shareholder, participant, officer,
6-19 director, manager, affiliate, or service provider of a financial
6-20 institution, other than a public statement or a public portion of a
6-21 call report or profit and loss statement, regardless of whether the
6-22 facts or information is obtained through application, examination,
6-23 or otherwise. All related files and records of the department are
6-24 confidential and may not be disclosed <savings bank obtained in
6-25 the course of an examination or by reason of the individual's
6-26 official position, unless the public duty of the person requires
6-27 otherwise>. A person who violates this section or wilfully makes a
7-1 false official report on the condition of a financial institution
7-2 <savings bank> shall be removed from office or further employment
7-3 with the Savings and Loan Department of Texas.
7-4 (b) A report of an examination made to the commissioner is
7-5 confidential and not for public record or inspection, except that
7-6 the commissioner for good reason may make the report public.
7-7 (c) This section does not prevent the proper exchange of
7-8 information relating to savings banks and the business of savings
7-9 banks with the representatives of regulatory authorities of other
7-10 states or to any other department, agency, or instrumentality of
7-11 this state, another state, or the United States if the commissioner
7-12 determines the disclosure necessary or proper for the enforcement
7-13 of the laws of this state, another state, or the United States.
7-14 (d) Unless otherwise provided by this Act, this section does
7-15 not apply to facts, information, or reports of investigations
7-16 obtained or made by the commissioner or the commissioner's staff in
7-17 connection with an application for charter or a hearing held by the
7-18 commissioner under this Act, and those facts, information, or
7-19 reports may be included in the record of the appropriate hearing.
7-20 (e) The commissioner shall report promptly to the finance
7-21 commission when a supervisory order is issued under Chapter 5 of
7-22 this Act. The commissioner shall furnish information about a
7-23 savings bank or person as the finance commission may require in
7-24 executive session, and all information discussed in the executive
7-25 session is confidential.
7-26 (f) Confidential information that is provided to a financial
7-27 institution or an affiliate or service provider of a financial
8-1 institution, whether in the form of a report of examination or
8-2 otherwise, is the confidential property of the department. Unless
8-3 approved in writing by the commissioner or authorized by rules
8-4 adopted under this section, the information may not be made public
8-5 or disclosed in any manner by the recipient, or by an officer,
8-6 director, manager, employee, or agent of the recipient, to a person
8-7 not officially connected to the recipient as officer, director,
8-8 employee, attorney, auditor, or independent auditor.
8-9 (g) Discovery of confidential information under subpoena or
8-10 other legal process from a person subject to this section must
8-11 comply with rules adopted under this Act. The rules may restrict
8-12 release of confidential information to that portion directly
8-13 relevant to the legal dispute involved and may require that a
8-14 protective order, in the form and under circumstances specified by
8-15 the rules, be issued by a court of competent jurisdiction before
8-16 release of confidential information.
8-17 (h) Notwithstanding any other law, the commissioner may
8-18 refuse to release any information or record in the custody of the
8-19 department if the commissioner believes release of the information
8-20 or record might jeopardize an investigation of possibly unlawful
8-21 activities.
8-22 SECTION 7. Section 6.03(a), Texas Savings Bank Act (Article
8-23 489e, Vernon's Texas Civil Statutes), is amended to read as
8-24 follows:
8-25 (a) A person may not be a member of the board of directors
8-26 of a savings bank if the person:
8-27 (1) <is not a citizen of the United States;>
9-1 <(2)> is not at least 18 years of age;
9-2 (2) <(3)> has been adjudicated bankrupt or convicted
9-3 of a criminal offense involving dishonesty or breach of trust,
9-4 unless given prior written approval to be a member of the board by
9-5 the commissioner;
9-6 (3) <(4)> has a final judgment entered against the
9-7 person for a sum of money that has remained unsatisfied or
9-8 unsecured for more than six months after the date of the judgment's
9-9 entry, unless the commissioner gives the person prior written
9-10 approval to be a member of the board or unless the judgment was
9-11 satisfied of record more than one year before the date of the
9-12 election; or
9-13 (4) <(5)> is a director, officer, or employee of
9-14 another savings bank, unless given the prior written approval to
9-15 be a member of the board by the commissioner.
9-16 SECTION 8. Section 7.01, Texas Savings Bank Act (Article
9-17 489e, Vernon's Texas Civil Statutes), is amended to read as
9-18 follows:
9-19 Sec. 7.01. GENERAL CORPORATE POWERS. (a) Each savings bank
9-20 has the powers authorized by this Act and other rights, privileges,
9-21 and powers as may be incidental to or reasonably necessary for the
9-22 accomplishment of the objects and purposes of the savings bank.
9-23 Subject to the prior approval of the commissioner, a savings bank
9-24 may engage in business as a savings bank in any state or territory
9-25 of the United States to the extent permitted by the laws of that
9-26 state or territory, either directly or through ownership of another
9-27 savings bank incorporated under the laws of another state.
10-1 (b) The finance commission by rule may expand savings bank
10-2 powers to accommodate or take advantage of changing technology and
10-3 enable state savings banks to respond to the needs of and
10-4 convenience demanded by consumers and businesses through
10-5 on-premises and off-premises operations, except that the finance
10-6 commission may not authorize state savings banks to offer financial
10-7 services prohibited to state savings banks by laws of this state
10-8 other than this Act. In adopting any rules under this subsection,
10-9 the finance commission shall consider the need to:
10-10 (1) promote a stable financial institution
10-11 environment;
10-12 (2) provide the public with convenient, safe, and
10-13 competitive financial services; and
10-14 (3) allow for economic development within the state.
10-15 SECTION 9. Section 7.05, Texas Savings Bank Act (Article
10-16 489e, Vernon's Texas Civil Statutes), is amended to read as
10-17 follows:
10-18 Sec. 7.05. INVESTMENT IN BANKING PREMISES. (a) Without
10-19 prior approval of the commissioner, a <A> savings bank may invest
10-20 not more than an amount equal to its regulatory capital in real
10-21 estate, buildings, and related facilities, including parking, and
10-22 in leasehold improvements for rented facilities for use by the
10-23 savings bank as its banking premises.
10-24 (b) The finance commission by rule adopted under Section
10-25 7.01(b) of this Act may approve a new form of savings bank facility
10-26 or authorize the commissioner to approve a new form of savings bank
10-27 facility if the commissioner does not have a significant
11-1 supervisory or regulatory concern regarding the proposed facility.
11-2 SECTION 10. Section 7.10(b), Texas Savings Bank Act (Article
11-3 489e, Vernon's Texas Civil Statutes), is amended to read as
11-4 follows:
11-5 (b) A savings bank may not make any investment in a
11-6 subsidiary corporation if its aggregate investments in subsidiaries
11-7 would exceed 10 percent of its total assets, excluding amounts
11-8 invested in a subsidiary corporation the activities of which are
11-9 limited to activities that could be conducted directly by the
11-10 parent savings bank.
11-11 SECTION 11. Section 8.02, Texas Savings Bank Act (Article
11-12 489e, Vernon's Texas Civil Statutes), is amended to read as
11-13 follows:
11-14 Sec. 8.02. LIQUIDITY. Unless approved in advance by the
11-15 commissioner, a savings bank shall maintain a minimum of 10 percent
11-16 of an amount equal to its average daily deposits for the most
11-17 recently completed calendar quarter <assets> in cash, balances in a
11-18 federal reserve bank or passed through a federal home loan bank or
11-19 another depository institution to a federal reserve bank under the
11-20 Federal Reserve Act (12 U.S.C. Section 221 et seq.), or other
11-21 readily marketable investments, including unencumbered federal
11-22 government sponsored enterprises securities, as allowed by rules
11-23 adopted by the commissioner and the finance commission.
11-24 SECTION 12. Section 12.12(a), Texas Savings Bank Act
11-25 (Article 489e, Vernon's Texas Civil Statutes), is amended to read
11-26 as follows:
11-27 (a) Except as provided in Subsection (b) of this section, a
12-1 reference in statutes of this state, including Title 79, Revised
12-2 Statutes (Article 5069-1.01 et seq., Vernon's Texas Civil
12-3 Statutes), the Government Code, and the Local Government Code or in
12-4 a rule adopted under the statutes to a "savings and loan
12-5 association," "savings and loan," or "association" in the context
12-6 of a savings and loan association, or to a corporation,
12-7 association, or other organization incorporated or organized under
12-8 the Texas Savings and Loan Act (Article 852a, Vernon's Texas Civil
12-9 Statutes), is also a reference to a savings bank, as defined in
12-10 this Act.
12-11 SECTION 13. (a) The changes made by this Act to the
12-12 procedures applicable to a proceeding before the savings and loan
12-13 commissioner apply only to a proceeding initiated on or after the
12-14 effective date of this Act. A proceeding initiated before the
12-15 effective date of this Act is governed by the law in effect when
12-16 the proceeding was initiated, and that law is continued in effect
12-17 for that purpose.
12-18 (b) The savings and loan commissioner shall by rule
12-19 prescribe the manner and period in which a savings bank that on the
12-20 effective date of this Act does not comply with Section 7.05 or
12-21 8.02, Texas Savings Bank Act (Article 489e, Vernon's Texas Civil
12-22 Statutes), as amended by this Act, shall come into compliance with
12-23 that section.
12-24 SECTION 14. The importance of this legislation and the
12-25 crowded condition of the calendars in both houses create an
12-26 emergency and an imperative public necessity that the
12-27 constitutional rule requiring bills to be read on three several
13-1 days in each house be suspended, and this rule is hereby suspended,
13-2 and that this Act take effect and be in force from and after its
13-3 passage, and it is so enacted.
13-4 COMMITTEE AMENDMENT NO. 1
13-5 Amend HB 1020 as follows:
13-6 Strike on page one, SECTION 1: "and (15)" and ""Financial
13-7 institution" means a state or federal savings bank, a state or
13-8 federal savings and loan association, <or> a state or national
13-9 bank, or a state or federal credit union."
13-10 Carona