By Giddings, Brimer H.B. No. 3006
74R4970 DWS-D
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to a residence requirement for a bank director.
1-3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-4 SECTION 1. Chapter I, The Texas Banking Code (Article
1-5 342-101 et seq., Vernon's Texas Civil Statutes), is amended by
1-6 adding Article 2A to read as follows:
1-7 Art. 2A. LOCAL AREA. For the purposes of this Act, a bank's
1-8 local area is its local community, as delineated under federal
1-9 regulations adopted under the Community Reinvestment Act of 1977
1-10 (12 U.S.C. Sec. 2901 et seq.), except that if the bank is not
1-11 subject to those regulations or if the bank's local community is
1-12 determined by its effective lending territory, the bank's local
1-13 area is the area that would be the bank's local community under
1-14 those regulations, excluding the regulations relating to effective
1-15 lending territory. Each bank shall file with the banking
1-16 commissioner a statement of its local area in the manner and form
1-17 prescribed by the banking commissioner.
1-18 SECTION 2. Sections 1 and 2, Article 4, Chapter IV, The
1-19 Texas Banking Code (Article 342-404, Vernon's Texas Civil
1-20 Statutes), are amended to read as follows:
1-21 Sec. 1. A State bank shall have not less than five (5) nor
1-22 more than twenty-five (25) directors, the majority of whom shall be
1-23 residents of the bank's local area <State of Texas>.
1-24 Sec. 2. If the bank is owned or controlled, directly or
2-1 indirectly, by an out-of-state bank holding company, directors who
2-2 are employees or officers or spouses of employees or officers of
2-3 the out-of-state bank holding company, or an affiliate of the
2-4 out-of-state bank holding company, other than the bank, shall not
2-5 be counted as residents of the bank's local area <State of Texas>
2-6 for the purpose of Section 1 of this article. For the purposes of
2-7 this section, "affiliate" means a person or entity, other than the
2-8 bank, that directly, or indirectly through one or more
2-9 intermediaries, controls, is controlled by, or is under common
2-10 control with the out-of-state bank holding company.
2-11 SECTION 3. Section 4, Article 12, Chapter IX, The Texas
2-12 Banking Code (Article 342-912, Vernon's Texas Civil Statutes), is
2-13 amended to read as follows:
2-14 Sec. 4. APPLICATION AND FILINGS BY OUT-OF-STATE BANK HOLDING
2-15 COMPANY SEEKING ACQUISITION. An out-of-state bank holding company
2-16 that seeks to take an action specified in Section 1 of this article
2-17 for which a copy of the application must be filed with the banking
2-18 commissioner shall also file with the banking commissioner, when it
2-19 delivers the application: (1) evidence that the out-of-state bank
2-20 holding company is authorized to take the action under Article 16
2-21 of this chapter;
2-22 (2) evidence that the out-of-state bank holding
2-23 company and each state bank, national bank in this state, and bank
2-24 holding company being acquired will, after the acquisition, comply
2-25 with applicable capital adequacy guidelines, and that the
2-26 consolidated equity capital condition of these banks in this state
2-27 during the first three years after being acquired will be
3-1 maintained at least at the level existing immediately prior to the
3-2 acquisition less the consolidated net loss of these banks, if any;
3-3 (3) agreements, subject to any contrary provision of
3-4 applicable federal law, that while the out-of-state bank holding
3-5 company directly or indirectly owns or controls any national bank
3-6 in this state, a majority of the directors of each national bank
3-7 shall be residents of the bank's local area <State of Texas>,
3-8 except that directors who are employees or officers or spouses of
3-9 employees or officers of the bank, out-of-state bank holding
3-10 company, or an affiliate of the bank or out-of-state bank holding
3-11 company may not be counted as residents of the bank's local area
3-12 <State of Texas> for the purpose of this subdivision; and
3-13 (4) an agreement to provide such additional
3-14 information as may be required by rules promulgated by the banking
3-15 commissioner.
3-16 SECTION 4. Before September 1, 1996:
3-17 (1) each out-of-state bank holding company required to
3-18 submit an agreement under Section 4(3), Article 12, Chapter IX, The
3-19 Texas Banking Code (Article 342-912, Vernon's Texas Civil
3-20 Statutes), shall:
3-21 (A) submit to the banking commissioner an
3-22 amended agreement complying with that subdivision, as amended by
3-23 this Act; and
3-24 (B) comply with the amended agreement; and
3-25 (2) each state bank shall conform its board of
3-26 directors to the requirements of Article 4, Chapter IV, The Texas
3-27 Banking Code (Article 342-404, Vernon's Texas Civil Statutes), as
4-1 amended by this Act.
4-2 SECTION 5. This Act takes effect September 1, 1995.
4-3 SECTION 6. The importance of this legislation and the
4-4 crowded condition of the calendars in both houses create an
4-5 emergency and an imperative public necessity that the
4-6 constitutional rule requiring bills to be read on three several
4-7 days in each house be suspended, and this rule is hereby suspended.