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A BILL TO BE ENTITLED
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AN ACT
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relating to the regulation of state banks and state trust |
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companies. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Section 32.002(a), Finance Code, is amended to |
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read as follows: |
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(a) The articles of association of a state bank must be |
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signed and acknowledged by each organizer and must contain: |
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(1) the name of the bank, subject to Subsection (b); |
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(2) the period of the bank's duration, which may be |
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perpetual, subject to Subsection (c); |
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(3) the powers of the bank, which may be stated as: |
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(A) all powers granted by law to a state bank; or |
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(B) a list of the specific powers under Section |
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32.001 that the bank chooses to exercise; |
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(4) the aggregate number of shares or participation |
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shares that the bank will be authorized to issue and the number of |
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classes of shares or participation shares, which may be one or more; |
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(5) if the shares or participation shares are to be |
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divided into classes: |
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(A) the designation of each class and statement |
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of the preferences, limitations, and relative rights of the shares |
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or participation shares of each class, which in the case of a |
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limited banking association may be more fully set forth in the |
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participation agreement; |
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(B) the number of shares or participation shares |
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of each class; and |
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(C) a statement of the par value of the shares or |
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participation shares of each class or that the shares or |
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participation shares are to be without par value; |
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(6) any provision limiting or denying to shareholders |
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or participants the preemptive right to acquire additional or |
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treasury shares or participation shares of the bank; |
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(7) any provision granting the right of shareholders |
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or participants to cumulative voting in the election of directors |
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or managers; |
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(8) the aggregate amount of consideration to be |
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received for all shares or participation shares initially issued by |
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the bank and a statement that: |
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(A) all authorized shares or participation |
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shares have been subscribed; and |
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(B) all subscriptions received have been |
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irrevocably [provide for the consideration to be fully] paid in |
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cash [before issuance of the charter]; |
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(9) any provision consistent with law that the |
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organizers elect to set forth in the articles of association for the |
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regulation of the internal affairs of the bank or that is otherwise |
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required by this subtitle to be set forth in the articles of |
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association; |
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(10) the street address of the bank's initial home |
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office; and |
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(11) either: |
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(A) the number of directors or managers |
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constituting the initial board and the names and street addresses |
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of the persons who are to serve as directors or managers until the |
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first annual meeting of shareholders or participants or until |
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successor directors or managers have been elected and qualified; or |
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(B) the statement described by Subsection (d). |
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SECTION 2. Sections 32.004(b) and (c), Finance Code, are |
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amended to read as follows: |
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(b) At the expense of the organizers, the banking |
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commissioner shall thoroughly investigate the application. The |
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banking commissioner shall prepare a written report of the |
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investigation[, and any person, other than a person protesting
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under Section 32.005, may request a copy of the nonconfidential
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portions of the application and written report as provided by
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Chapter 552, Government Code]. |
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(c) Rules adopted under this subtitle may specify the |
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confidential or nonconfidential character of information obtained |
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or prepared by the department under this chapter. Except as |
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provided by Subchapter D, Chapter 31, or in rules regarding |
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confidential information, the business plan of the applicant and |
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the financial statement of a proposed officer, director, manager, |
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or managing participant are [is] confidential and not subject to |
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public disclosure. |
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SECTION 3. Sections 32.005(a) through (d), Finance Code, |
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are amended to read as follows: |
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(a) A protest of a charter application must be received by |
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the department before the 15th day after the date the organizers |
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publish notice under Section 32.004(a) and must be accompanied by |
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the fees and deposits required by law. If the protest is untimely, |
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the department shall return all submitted fees and deposits to the |
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protesting party. If the protest is timely, the department shall |
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notify the applicant of the protest and mail or deliver a complete |
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copy of the nonconfidential sections of the charter application to |
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the protesting party before the 15th day after the later of the date |
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of receipt of the protest or receipt of the charter application [Any
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person may file a protest of an application]. |
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(b) A protesting party must file a detailed protest |
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responding to each contested statement contained in the |
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nonconfidential portion of the application not later than the 20th |
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day after the date the protesting party receives the application |
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from the department, and relate each statement and response to the |
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standards for approval set forth in Section 32.003(b). The |
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applicant must file a written reply to the protesting party's |
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detailed response on or before the 10th day after the date the |
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response is filed. The protesting party's response and the |
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applicant's reply must be verified by affidavit and must certify |
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that a copy was served on the opposing party. If applicable, |
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statements in the response and in the reply may be supported by |
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references to data available in sources of which official notice |
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may properly be taken. Any comment received by the department and |
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any reply of the applicant to the comment shall be made available to |
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the protesting party [If a protest of the application is not filed
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before the 15th day after the date the organizers publish notice
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under Section 32.004(a), the banking commissioner may immediately
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determine whether the necessary conditions set forth in Section
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32.003(b) have been established, based on the application and
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investigation. The banking commissioner shall approve the charter
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application or set the charter application for hearing]. |
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(c) The banking commissioner may not be compelled to hold a |
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hearing before granting or denying the charter application. In the |
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exercise of discretion, the banking commissioner may consider |
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granting a hearing on a charter application at the request of the |
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applicant or a protesting party. The banking commissioner may order |
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a hearing regardless of whether a hearing has been requested by a |
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party. A party requesting a hearing must indicate with specificity |
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the issues involved that cannot be determined on the basis of the |
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record compiled under Subsection (b) and why the issues cannot be |
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determined. A request for hearing and the banking commissioner's |
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decision with regard to granting a hearing shall be made a part of |
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the record. If [a protest of the application is timely filed,
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accompanied by the fees and deposits required by law, or if] the |
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banking commissioner sets a hearing, the banking commissioner shall |
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conduct a public hearing and one or more prehearing conferences and |
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opportunities for discovery as the banking commissioner considers |
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advisable and consistent with the applicable law, except that the |
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banking commissioner may not permit discovery of confidential |
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information in the charter application or the investigation report. |
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[A person protesting the application is entitled to the
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confidential portion of the application, subject to a protective
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order that restricts the use of confidential information to the
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charter proceedings.] |
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(d) Based on the record [of the hearing], the banking |
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commissioner shall determine whether the application meets the |
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requirements of Section 32.003(b) and shall enter an order granting |
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or denying the charter. |
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SECTION 4. Sections 32.103(b) and (c), Finance Code, are |
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amended to read as follows: |
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(b) Unless restricted by rule, prior written approval is not |
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required for an increase in capital and surplus accomplished |
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through: |
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(1) issuance of shares of common stock [or their
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equivalent in participation shares] for cash, or a cash |
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contribution to surplus by shareholders that does not result in |
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issuance of additional common stock or other securities; |
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(2) declaration and payment of pro rata share |
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dividends as defined by the [Texas] Business Organizations Code |
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[Corporation Act]; or |
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(3) adoption by the board of a resolution directing |
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that all or part of undivided profits be transferred to capital or |
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surplus. |
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(c) Prior approval is not required for: |
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(1) a decrease in capital or surplus caused by losses |
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in excess of undivided profits; or |
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(2) a change in capital and surplus resulting from |
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accounting adjustments required by a transaction approved by the |
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banking commissioner if the accounting adjustments are reasonably |
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disclosed in the submitted application. |
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SECTION 5. Section 32.401, Finance Code, is amended to read |
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as follows: |
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Sec. 32.401. AUTHORITY TO PURCHASE ASSETS [OF ANOTHER
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FINANCIAL INSTITUTION]. (a) A state bank [with the prior written
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approval of the banking commissioner] may purchase [all or
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substantially all of the] assets from [of] another financial |
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institution or other seller, except that the prior written approval |
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of the banking commissioner is required if the purchase price |
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exceeds an amount equal to three times the bank's unimpaired |
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capital and surplus. The finance commission by rule may require a |
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state bank to obtain the prior written approval of the banking |
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commissioner for a transaction not otherwise subject to approval |
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that involves potentially substantial risks to the safety and |
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soundness of the purchasing bank. |
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(b) Except as otherwise expressly provided by another |
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statute, the purchase of all or part of the assets of the selling |
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entity [institution] does not make the purchasing bank responsible |
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for any liability or obligation of the selling entity [institution] |
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that the purchasing bank does not expressly assume. |
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[(c) Except as otherwise provided by this subtitle, this
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subchapter does not govern or prohibit the purchase by a state bank
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of all or part of the assets of a corporation or other entity that is
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not a financial institution.] |
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SECTION 6. Section 32.405, Finance Code, is amended to read |
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as follows: |
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Sec. 32.405. SALE OF ASSETS. (a) A state bank may sell a |
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portion of its assets to another financial institution or other |
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buyer, except that the prior written approval of the banking |
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commissioner is required if the sales price exceeds an amount equal |
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to three times the bank's unimpaired capital and surplus. The |
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finance commission by rule may require a state bank to obtain the |
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prior written approval of the banking commissioner for a |
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transaction not otherwise subject to approval that involves |
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potentially substantial risks to the safety and soundness of the |
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selling bank. |
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(b) If the prior approval of the banking commissioner for a |
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sale of assets is not required under Subsection (a) and the sale |
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involves the disposition of a branch office or another established |
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location of the state bank, the state bank must provide written |
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notice of the transaction to the banking commissioner at least 30 |
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days before the expected closing date of the transaction. |
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(c) The board of a state bank, with the prior written |
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approval of the banking commissioner, may cause the bank to sell all |
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or substantially all of its assets without shareholder or |
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participant approval if: |
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(1) the banking commissioner finds the interests of |
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depositors and creditors are jeopardized because of insolvency or |
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imminent insolvency and that the sale is in their best interest; and |
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(2) the Federal Deposit Insurance Corporation or its |
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successor approves the transaction and agrees to provide assistance |
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to the prospective buyer under 12 U.S.C. Section 1823(c) or a |
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comparable law unless the deposits of the bank are not insured. |
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(d) [(b)] A sale under Subsection (c) [this section] must |
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include an assumption and promise by the buyer to pay or otherwise |
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discharge: |
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(1) all of the bank's liabilities to depositors; |
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(2) all of the bank's liabilities for salaries of the |
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bank's employees incurred before the date of the sale; |
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(3) obligations incurred by the banking commissioner |
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arising out of the supervision or sale of the bank; and |
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(4) fees and assessments due the department. |
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(e) [(c)] This section does not affect the banking |
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commissioner's right to take action under another law. The sale by |
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a state bank of all or substantially all of its assets with |
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shareholder or participant approval is considered a voluntary |
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dissolution and liquidation and is governed by Subchapter B, |
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Chapter 36. |
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SECTION 7. Section 32.501(c), Finance Code, is amended to |
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read as follows: |
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(c) The state bank does not cease to be a state bank subject |
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to the supervision of the banking commissioner unless: |
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(1) the banking commissioner has been given written |
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notice of the intention to merge or convert before the 31st day |
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before the date of the proposed transaction; |
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(2) [the bank has published notice of the transaction,
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in the form and frequency specified by the banking commissioner,
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in:
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[(A) a newspaper of general circulation
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published in the county of its home office or, if such a newspaper
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is not published in the county, in an adjacent county; and
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[(B) other locations that the banking
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commissioner considers appropriate;
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[(3)] the bank has filed with the banking |
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commissioner: |
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(A) a copy of the application filed with the |
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successor regulatory authority, including a copy of each contract |
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evidencing or implementing the merger or conversion, or other |
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documents sufficient to show compliance with applicable law; and |
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(B) a certified copy of all minutes of board |
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meetings and shareholder or participant meetings at which action |
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was taken regarding the merger or conversion; [and
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[(C) a publisher's certificate showing
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publication of the required notice;] |
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(3) [(4)] the banking commissioner determines that: |
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(A) all deposit and other liabilities of the |
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state bank are fully discharged, assumed, or otherwise retained by |
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the successor form of financial institution; |
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(B) any conditions imposed by the banking |
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commissioner for the protection of depositors and creditors have |
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been met or otherwise resolved; and |
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(C) any required filing fees have been paid; and |
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(4) [(5)] the bank has received a certificate of |
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authority to do business as the successor financial institution. |
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SECTION 8. Section 33.002(c), Finance Code, is amended to |
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read as follows: |
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(c) Rules adopted under this subtitle may specify the |
|
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confidential or nonconfidential character of information obtained |
|
|
by the banking commissioner under this section. In the absence of |
|
|
rules, information [Information] obtained by the banking |
|
|
commissioner under this section is confidential and may not be |
|
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disclosed by the banking commissioner or any employee of the |
|
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department except as provided by Subchapter D, Chapter 31. |
|
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SECTION 9. Section 36.102, Finance Code, is amended to read |
|
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as follows: |
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Sec. 36.102. FILING RESOLUTIONS WITH BANKING |
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COMMISSIONER. After resolutions to dissolve and liquidate a state |
|
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bank have been adopted by the bank's board and shareholders or |
|
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participants, a majority of the directors, managers, or managing |
|
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participants shall verify and file with the banking commissioner |
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[duplicate] certified copies of: |
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(1) the resolutions of the shareholders or |
|
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participants that: |
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(A) are adopted at a meeting for which proper |
|
|
notice was given or by unanimous written consent; and |
|
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(B) approve the dissolution and liquidation of |
|
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the bank; |
|
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(2) the resolutions of the board approving the |
|
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dissolution and liquidation of the bank if the bank is operated by a |
|
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board of directors or managers; and |
|
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(3) [a copy of] the notice to the shareholders or |
|
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participants informing them of the meeting. |
|
|
SECTION 10. Section 182.002(a), Finance Code, is amended to |
|
|
read as follows: |
|
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(a) The articles of association of a state trust company |
|
|
must be signed and acknowledged by each organizer and must contain: |
|
|
(1) the name of the state trust company, subject to |
|
|
Subsection (b); |
|
|
(2) the period of the state trust company's duration, |
|
|
which may be perpetual; |
|
|
(3) the powers of the state trust company, which may be |
|
|
stated as: |
|
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(A) all powers granted to a state trust company |
|
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in this state; or |
|
|
(B) a list of the specific powers that the state |
|
|
trust company chooses and is authorized to exercise; |
|
|
(4) the aggregate number of shares, or participation |
|
|
shares in the case of a limited trust association, that the state |
|
|
trust company will be authorized to issue, and the number of classes |
|
|
of shares or participation shares, which may be one or more; |
|
|
(5) if the shares or participation shares are to be |
|
|
divided into classes: |
|
|
(A) the designation of each class and statement |
|
|
of the preferences, limitations, and relative rights of the shares |
|
|
or participation shares of each class, which in the case of a |
|
|
limited trust association may be more fully set forth in the |
|
|
participation agreement; |
|
|
(B) the number of shares or participation shares |
|
|
of each class; and |
|
|
(C) a statement of the par value of the shares or |
|
|
participation shares of each class or that the shares or |
|
|
participation shares are to be without par value; |
|
|
(6) any provision limiting or denying to shareholders |
|
|
or participants the preemptive right to acquire additional or |
|
|
treasury shares or participation shares of the state trust company; |
|
|
(7) any provision granting the right of shareholders |
|
|
or participants to cumulative voting in the election of directors |
|
|
or managers; |
|
|
(8) the aggregate amount of consideration to be |
|
|
received for all shares or participation shares initially issued by |
|
|
the state trust company and a statement that: |
|
|
(A) all authorized shares or participation |
|
|
shares have been subscribed; and |
|
|
(B) all subscriptions received have been |
|
|
irrevocably [provide for the consideration to be fully] paid in |
|
|
cash [before issuance of the charter]; |
|
|
(9) any provision consistent with law that the |
|
|
organizers elect to set forth in the articles of association for the |
|
|
regulation of the internal affairs of the state trust company or |
|
|
that is otherwise required by this subtitle to be set forth in the |
|
|
articles of association; |
|
|
(10) the street address of the state trust company's |
|
|
home office; and |
|
|
(11) either: |
|
|
(A) the number of directors or managers |
|
|
constituting the initial board and the names and street addresses |
|
|
of the persons who are to serve as directors or managers until the |
|
|
first annual meeting of shareholders or participants or until |
|
|
successor directors or managers have been elected and qualified; or |
|
|
(B) the statement described by Subsection (c). |
|
|
SECTION 11. Sections 182.004(b) and (c), Finance Code, are |
|
|
amended to read as follows: |
|
|
(b) At the expense of the organizers, the banking |
|
|
commissioner shall thoroughly investigate the application and |
|
|
inquire fully into the identity and character of each proposed |
|
|
director, manager, officer, managing participant, and principal |
|
|
shareholder or participant. The banking commissioner shall prepare |
|
|
a written report of the investigation[, and any person, other than a
|
|
|
person protesting under Section 182.005, may request a copy of the
|
|
|
nonconfidential portions of the application and written report as
|
|
|
provided by Chapter 552, Government Code]. |
|
|
(c) Rules adopted under this subtitle may specify the |
|
|
confidential or nonconfidential character of information obtained |
|
|
or prepared by the department under this section. Except as |
|
|
provided by Subchapter D, Chapter 181, or in rules regarding |
|
|
confidential information, the business plan of the applicant and |
|
|
the financial statement of a proposed officer, director, manager, |
|
|
or managing participant are [is] confidential and not subject to |
|
|
public disclosure. |
|
|
SECTION 12. Sections 182.005(a) through (d), Finance Code, |
|
|
are amended to read as follows: |
|
|
(a) A protest of a charter application must be received by |
|
|
the department before the 15th day after the date the organizers |
|
|
publish notice under Section 182.004(a) and must be accompanied by |
|
|
the fees and deposits required by law. If the protest is untimely, |
|
|
the department shall return all submitted fees and deposits to the |
|
|
protesting party. If the protest is timely, the department shall |
|
|
notify the applicant of the protest and mail or deliver a complete |
|
|
copy of the nonconfidential sections of the charter application to |
|
|
the protesting party before the 15th day after the later of the date |
|
|
of receipt of the protest or receipt of the charter application [Any
|
|
|
person may file a protest of an application with the banking
|
|
|
commissioner]. |
|
|
(b) A protesting party must file a detailed protest |
|
|
responding to each contested statement contained in the |
|
|
nonconfidential portion of the application not later than the 20th |
|
|
day after the date the protesting party receives the application |
|
|
from the department, and relate each statement and response to the |
|
|
standards for approval set forth in Section 182.003(b). The |
|
|
applicant must file a written reply to the protesting party's |
|
|
detailed response on or before the 10th day after the date the |
|
|
response is filed. The protesting party's response and the |
|
|
applicant's reply must be verified by affidavit and must certify |
|
|
that a copy was served on the opposing party. If applicable, |
|
|
statements in the response and in the reply may be supported by |
|
|
references to data available in sources of which official notice |
|
|
may properly be taken. Any comment received by the department and |
|
|
any reply of the applicant to the comment shall be made available to |
|
|
the protesting party [If a protest of the application is not filed
|
|
|
on or before the 15th day after the last date the notice was
|
|
|
published under Section 182.004, the banking commissioner may
|
|
|
immediately determine whether all of the necessary conditions set
|
|
|
forth in Section 182.003(b) have been established, based on the
|
|
|
application and investigation. The banking commissioner shall
|
|
|
approve the application for charter or set the charter application
|
|
|
for hearing]. |
|
|
(c) The banking commissioner may not be compelled to hold a |
|
|
hearing before granting or denying the charter application. In the |
|
|
exercise of discretion, the banking commissioner may consider |
|
|
granting a hearing on a charter application at the request of the |
|
|
applicant or a protesting party. The banking commissioner may order |
|
|
a hearing regardless of whether a hearing has been requested by a |
|
|
party. A party requesting a hearing must indicate with specificity |
|
|
the issues involved that cannot be determined on the basis of the |
|
|
record compiled under Subsection (b) and why the issues cannot be |
|
|
determined. A request for hearing and the banking commissioner's |
|
|
decision with regard to granting a hearing shall be made a part of |
|
|
the record. If [a protest of the application is timely filed,
|
|
|
accompanied by the fees and deposits required by statute or rule, or
|
|
|
if] the banking commissioner sets a hearing, the banking |
|
|
commissioner shall conduct a public hearing and as many prehearing |
|
|
conferences and opportunities for discovery as the banking |
|
|
commissioner considers advisable and consistent with governing |
|
|
statutes and rules, except that the banking commissioner may not |
|
|
permit discovery of confidential information in the charter |
|
|
application or the investigation report. [A person protesting the
|
|
|
application is entitled to the confidential portions of the
|
|
|
application under a protective order that restricts the use of
|
|
|
confidential information to the charter proceedings.] |
|
|
(d) Based on the record [of the hearing], the banking |
|
|
commissioner shall determine whether all of the necessary |
|
|
conditions set forth in Section 182.003(b) have been established |
|
|
and shall enter an order granting or denying the charter. |
|
|
SECTION 13. Sections 182.103(b) and (c), Finance Code, are |
|
|
amended to read as follows: |
|
|
(b) Unless otherwise restricted by rules, prior approval is |
|
|
not required for an increase in restricted capital accomplished |
|
|
through: |
|
|
(1) issuance of shares of common stock or their |
|
|
equivalent in participation shares for cash, or a cash contribution |
|
|
to surplus by shareholders or participants that does not result in |
|
|
issuance of additional common stock or other securities; |
|
|
(2) declaration and payment of pro rata share |
|
|
dividends as defined by the [Texas] Business Organizations Code |
|
|
[Corporation Act]; or |
|
|
(3) adoption by the board of a resolution directing |
|
|
that all or part of undivided profits be transferred to restricted |
|
|
capital. |
|
|
(c) Prior approval is not required for: |
|
|
(1) a decrease in restricted capital caused by |
|
|
[incurred] losses in excess of undivided profits; or |
|
|
(2) a change in restricted capital resulting from |
|
|
accounting adjustments required by a transaction approved by the |
|
|
banking commissioner if the accounting adjustments are reasonably |
|
|
disclosed in the submitted application. |
|
|
SECTION 14. Section 182.401, Finance Code, is amended to |
|
|
read as follows: |
|
|
Sec. 182.401. AUTHORITY TO PURCHASE ASSETS [OF ANOTHER
|
|
|
TRUST INSTITUTION]. (a) A state trust company [with the prior
|
|
|
written approval of the banking commissioner] may purchase [all or
|
|
|
substantially all of the] assets from [of] another trust |
|
|
institution, including the right to control accounts established |
|
|
with the trust institution, or assets from another seller, except |
|
|
that the prior written approval of the banking commissioner is |
|
|
required if the purchase price exceeds an amount equal to three |
|
|
times the sum of the trust company's equity capital less intangible |
|
|
assets. The finance commission by rule may require a state trust |
|
|
company to obtain the prior written approval of the banking |
|
|
commissioner for a transaction not otherwise subject to approval |
|
|
that involves potentially substantial risks to the safety and |
|
|
soundness of the purchasing trust company. |
|
|
(b) Except as otherwise expressly provided by this section |
|
|
or another statute, the purchase of all or part of the assets of the |
|
|
selling entity [trust institution] does not make the purchasing |
|
|
state trust company responsible for any liability or obligation of |
|
|
the selling entity [trust institution] that the purchasing state |
|
|
trust company does not expressly assume. |
|
|
(c) If prior approval of the banking commissioner is |
|
|
required [Except as otherwise provided by this subtitle, this
|
|
|
subchapter does not govern or prohibit the purchase by a state trust
|
|
|
company of all or part of the assets of a corporation or other
|
|
|
entity that is not a trust institution.
|
|
|
[(d)To make a purchase] under this section, an application |
|
|
in the form required by the banking commissioner must be filed with |
|
|
the banking commissioner. The banking commissioner shall |
|
|
investigate the condition of the purchaser and seller and may |
|
|
require the submission of additional information as considered |
|
|
necessary to make an informed decision. |
|
|
(d) [(e)] The banking commissioner shall approve the |
|
|
application to purchase if: |
|
|
(1) the purchasing state trust company: |
|
|
(A) has complied with all applicable statutes and |
|
|
rules; and |
|
|
(B) will be solvent and have sufficient |
|
|
capitalization for its business and location; |
|
|
(2) all fiduciary obligations and liabilities of each |
|
|
trust institution that is a party to the purchase or sale of assets |
|
|
have been properly discharged or otherwise lawfully assumed or |
|
|
retained by a trust institution or other fiduciary; |
|
|
(3) all conditions imposed by the banking commissioner |
|
|
have been satisfied or otherwise resolved; and |
|
|
(4) all fees and costs have been paid. |
|
|
(e) [(f)] A purchase subject to prior approval is effective |
|
|
on the date of approval unless the purchase agreement provides for |
|
|
and the banking commissioner consents to a different effective |
|
|
date. |
|
|
(f) If the purchase transaction includes all or |
|
|
substantially all of the assets of another trust institution or |
|
|
other fiduciary, the [(g) The] acquiring state trust company shall |
|
|
succeed by operation of law to all of the rights, privileges, and |
|
|
fiduciary obligations of the selling trust institution or other |
|
|
fiduciary under each account included in the assets acquired. |
|
|
SECTION 15. Section 182.405, Finance Code, is amended to |
|
|
read as follows: |
|
|
Sec. 182.405. SALE OF ASSETS. (a) A state trust company |
|
|
may sell all or any portion of its assets to another trust |
|
|
institution or other buyer, except that the prior written approval |
|
|
of the banking commissioner is required if the sales price exceeds |
|
|
an amount equal to three times the sum of the trust company's equity |
|
|
capital less intangible assets. The finance commission by rule may |
|
|
require a state trust company to obtain the prior written approval |
|
|
of the banking commissioner for a transaction not otherwise subject |
|
|
to approval that involves potentially substantial risks to the |
|
|
safety and soundness of the selling trust company. |
|
|
(b) If the prior approval of the banking commissioner for a |
|
|
sale of assets is not required under Subsection (a) and the sale |
|
|
involves the disposition of an established location of the state |
|
|
trust company, the state trust company must provide written notice |
|
|
of the transaction to the banking commissioner at least 30 days |
|
|
before the expected closing date of the transaction. |
|
|
(c) The board of a state trust company, with the banking |
|
|
commissioner's approval, may cause the state trust company to sell |
|
|
all or substantially all of its assets, including the right to |
|
|
control accounts established with the state trust company, without |
|
|
shareholder or participant approval if: |
|
|
(1) the banking commissioner finds that the interests |
|
|
of the state trust company's clients, depositors, and creditors are |
|
|
jeopardized because of the hazardous condition of the state trust |
|
|
company and that the sale is in their best interest; and |
|
|
(2) the Federal Deposit Insurance Corporation or its |
|
|
successor approves the transaction, if the deposits of the state |
|
|
trust company are insured. |
|
|
(d) [(b)] A sale under Subsection (c) [this section] must |
|
|
include an assumption and promise by the buyer to pay or otherwise |
|
|
discharge: |
|
|
(1) all of a state trust company's liabilities to |
|
|
clients and depositors; |
|
|
(2) all of the state trust company's liabilities for |
|
|
salaries of the state trust company's employees incurred before the |
|
|
date of the sale; |
|
|
(3) obligations incurred by the banking commissioner |
|
|
arising out of the supervision or sale of the state trust company; |
|
|
and |
|
|
(4) fees and assessments due the department. |
|
|
(e) [(c) This section does not limit the incidental power of
|
|
|
a state trust company to buy and sell assets in the ordinary course
|
|
|
of business.
|
|
|
[(d)] This section does not affect the banking |
|
|
commissioner's right to take action under another law. The sale by |
|
|
a state trust company of all or substantially all of its assets with |
|
|
shareholder or participant approval is considered a voluntary |
|
|
dissolution and liquidation and is governed by Subchapter B, |
|
|
Chapter 186. |
|
|
(f) Each buyer in a transaction described by Subsection (c) |
|
|
that is a [(e) The acquiring] trust institution or other fiduciary |
|
|
shall succeed by operation of law to all of the rights, privileges, |
|
|
and fiduciary obligations of the selling state trust company under |
|
|
each account included in the assets acquired. |
|
|
SECTION 16. Section 182.501(c), Finance Code, is amended to |
|
|
read as follows: |
|
|
(c) The state trust company does not cease to be a state |
|
|
trust company subject to the supervision of the banking |
|
|
commissioner unless: |
|
|
(1) the banking commissioner has been given written |
|
|
notice of the intention to merge or convert before the 31st day |
|
|
before the date of the proposed transaction; |
|
|
(2) [the state trust company has published notice of
|
|
|
the transaction, in the form and frequency specified by the banking
|
|
|
commissioner, in:
|
|
|
[(A) a newspaper of general circulation
|
|
|
published in the county of its home office or, if such a newspaper
|
|
|
is not published in the county, in an adjacent county; and
|
|
|
[(B) other locations that the banking
|
|
|
commissioner considers appropriate;
|
|
|
[(3)] the state trust company has filed with the |
|
|
banking commissioner: |
|
|
(A) a copy of the application filed with the |
|
|
successor regulatory authority, including a copy of each contract |
|
|
evidencing or implementing the merger or conversion, or other |
|
|
documents sufficient to show compliance with applicable law; and |
|
|
(B) a certified copy of all minutes of board |
|
|
meetings and shareholder or participant meetings at which action |
|
|
was taken regarding the merger or conversion; [and
|
|
|
[(C) a publisher's certificate showing
|
|
|
publication of the required notice;] |
|
|
(3) [(4)] the banking commissioner determines that: |
|
|
(A) all accounts and liabilities of the state |
|
|
trust company are fully discharged, assumed, or otherwise retained |
|
|
by the successor trust institution; |
|
|
(B) any conditions imposed by the banking |
|
|
commissioner for the protection of clients and creditors have been |
|
|
met or otherwise resolved; and |
|
|
(C) any required filing fees have been paid; and |
|
|
(4) [(5)] the state trust company has received a |
|
|
certificate of authority to do business as the successor trust |
|
|
institution. |
|
|
SECTION 17. Section 183.002(c), Finance Code, is amended to |
|
|
read as follows: |
|
|
(c) Rules adopted under this subtitle may specify the |
|
|
confidential or nonconfidential character of information obtained |
|
|
by the banking commissioner under this section. In the absence of |
|
|
rules, information [Information] obtained by the banking |
|
|
commissioner under this section is confidential and may not be |
|
|
disclosed by the banking commissioner or any employee of the |
|
|
department except as provided by Subchapter D, Chapter 181. |
|
|
SECTION 18. Section 186.102, Finance Code, is amended to |
|
|
read as follows: |
|
|
Sec. 186.102. FILING RESOLUTIONS WITH BANKING |
|
|
COMMISSIONER. After resolutions to dissolve and liquidate a state |
|
|
trust company have been adopted by the board and shareholders or |
|
|
participants, a majority of the directors, managers, or managing |
|
|
participants shall verify and file with the banking commissioner |
|
|
[duplicate] certified copies of: |
|
|
(1) the resolutions of the shareholders or |
|
|
participants that: |
|
|
(A) are adopted at a meeting for which proper |
|
|
notice was given or by unanimous written consent; and |
|
|
(B) approve the dissolution and liquidation of |
|
|
the state trust company; |
|
|
(2) the resolutions of the board approving the |
|
|
dissolution and liquidation of the state trust company if the trust |
|
|
company is operated by a board of directors or managers; |
|
|
(3) [a copy of] the notice to the shareholders or |
|
|
participants informing them of the meeting described by Subdivision |
|
|
(1)(A); and |
|
|
(4) a plan of liquidation. |
|
|
SECTION 19. This Act takes effect September 1, 2007. |