Legislative Blog
J.B. Williams, J.D.
3 bills that modify the Finance Code
A Blog about 88th Legislature Laws
A Bit of Background
The following backgrounds help summarize the author's views on both the general topic: Texas and more specifically 88th Legislature Laws as it relates to that topic.
Brief Summary of Texas
Texas is truly a Republic. There are a multitude of items that to modify the state constitution must be modified. So there are times when Constitutional amendments are on the voting ballots. While I sometimes abhor the wording, the concept that all of those legally able to vote in Texas must vote on the change is a good one. And bills in Texas are generally short, making it easier for everyone to understand.
Summary of 88th Legislature Laws
The blogs here will discuss the laws passed by Congress and signed into law, as well as those, passed by Congress and approved by the voters to become law. There are a multitude of laws and each time I post blogs I will notate here the current effective date if it is different from prior blogs. I am currently posting bills that took effect immediately - those bills total 336. I am currently posting regarding larger bills, so each blog covers a single bill.
Blog Summary
HB 3574 - Modifies rules for acquisition of controlling interest in banks, and what banks may not due while under supervision.
SB 1645 - Permits hearings officers to be part-time contract employees.
SB 1646 - Sets out guidelines for a trust company becoming a state trust company; and modifies guidelines for accounting for state trust companies.
3 bills that modify the Finance Code
Published: 2024-04-05
HB 3574
Regulation of state banks
If a person acting an officer, director, employee, controlling shareholder or other position in a state bank, and they refuse to comply with a subpoena; then the banking commissioner may remove them on an emergency order basis until such time as the person complies with the subpoena.
A person cannot acquire, without the banking commissioners approval, securities in a state bank that would then put them in control of said bank. There are exemptions currently and the following is amended. The acquisition involves a controlling person who otherwise had the banking commissioners approval in writing already, they have continuously held power to vote 25% or more of the voting securities, or they have continuously controlled the state bank since prior approval of acquisition.
A state bank may now acquire a subsidiary or controlling interest in a subsidiary from which the bank has been prohibited if the investment is allowed by the Federal Deposit Insurance Corporation.
During a period of supervision, a bank, without prior approval of the banking commissioner, may not engage in activity that the banking commissioner believes is a threat to the safety and soundness of the bank.
SB 1645
Hearings officer of the Texas Department of Banking
Permits hearings officers to be employed under a contract on a part-time basis. Their only duty would be to preside over matters related to contested cases before a finance agency.
SB 1646
Regulation of state trust companies
This involves a trust institution seeking to convert to a state trust company. There are findings for the banking commissioner to review before it may so certify. It modifies the banking experience, ability, standing, competence, trustworthiness and integrity to be fiduciary experience, ability, standing, competence, trustworthiness and integrity.
It further modifies that a state trust company shall comply with regulatory accounting principles in accounting for investments in and depreciation of trust company facilities, furniture, fixtures, and equipment. And it adds that a state trust company may not invest its restricted capital in real property without the prior written approval of the banking commissioner. There are other already listed exceptions.
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