CHAPTER 203. INTERSTATE BANK MERGERS AND BRANCHING
FINANCE CODE
TITLE 3. FINANCIAL INSTITUTIONS AND BUSINESSES
SUBTITLE G. BANK HOLDING COMPANIES; INTERSTATE BANK OPERATIONS
CHAPTER 203. INTERSTATE BANK MERGERS AND BRANCHING
Sec. 203.001. INTERSTATE BRANCHING BY TEXAS STATE BANKS. (a)
With the prior approval of the commissioner, a Texas state bank
may establish and maintain a de novo branch or acquire a branch
in a state other than Texas pursuant to Section 32.203.
(b) With the prior approval of the commissioner, a Texas state
bank may establish, maintain, and operate one or more branches in
another state pursuant to an interstate merger transaction in
which the Texas state bank is the resulting bank. Not later than
the date on which the required application for the interstate
merger transaction is filed with the responsible federal bank
supervisory agency, the applicant Texas state bank shall file an
application on a form prescribed by the commissioner and pay the
fee prescribed by law. The applicant shall also comply with the
applicable provisions of Sections 32.301-32.303. The commissioner
shall approve the interstate merger transaction and the operation
of branches outside of this state by the Texas state bank if the
commissioner makes the findings required by Section 32.302(b). An
interstate merger transaction may be consummated only after the
applicant has received the commissioner's written approval.
Added by Acts 1999, 76th Leg., ch. 344, Sec. 1.001, eff. Sept. 1,
1999.
Sec. 203.002. CONDITIONS FOR ENTRY BY DE NOVO BRANCHING. (a)
An out-of-state bank may establish a de novo branch in this state
if:
(1) the laws of the home state of the out-of-state bank would
permit a Texas bank to establish and maintain a de novo branch in
that state under substantially the same terms and conditions as
set forth in this subchapter;
(2) the out-of-state bank confirms in writing to the
commissioner that as long as it maintains a branch in this state,
it will comply with all applicable laws of this state;
(3) the applicant provides satisfactory evidence to the
commissioner of compliance with the applicable requirements of
Section 201.102; and
(4) the commissioner, acting on or before the 30th day after the
date the commissioner receives notice of an application under
Subsection (b), certifies to the responsible federal bank
supervisory agency that the requirements of this subchapter have
been met.
(b) An out-of-state bank desiring to establish and maintain a de
novo branch shall provide written notice of the proposed
transaction to the commissioner not later than the date on which
the bank applies to the responsible federal bank supervisory
agency for approval to establish the branch. The filing of the
notice must be accompanied by the filing fee, if any, prescribed
by the commissioner.
(c) A de novo branch may be established in this state through
the acquisition of a branch of an existing Texas bank if the
acquiring out-of-state bank complies with this section.
(d) A depository institution may not establish or maintain a
branch in this state on the premises or property of an affiliate
if the affiliate engages in commercial activities, except as
provided by Section 92.063(d).
Added by Acts 1999, 76th Leg., ch. 344, Sec. 1.001, eff. Sept. 1,
1999.
Amended by:
Acts 2007, 80th Leg., R.S., Ch.
217, Sec. 4, eff. May 25, 2007.
Sec. 203.003. ENTRY BY INTERSTATE MERGER TRANSACTION. (a)
Subject to Sections 203.004 and 203.005, one or more Texas banks
may enter into an interstate merger transaction with one or more
out-of-state banks under this chapter, and an out-of-state bank
resulting from the transaction may maintain and operate the
branches in this state of a Texas bank that participated in the
transaction. An out-of-state bank that will be the resulting bank
in the interstate merger transaction shall comply with Section
201.102.
(b) An out-of-state bank that will be the resulting bank
pursuant to an interstate merger transaction involving a Texas
state bank shall notify the commissioner of the proposed merger
not later than the date on which it files an application for an
interstate merger transaction with the responsible federal bank
supervisory agency, and shall submit a copy of that application
to the commissioner and pay the filing fee, if any, required by
the commissioner. A Texas state bank that is a party to the
interstate merger transaction shall comply with Chapter 32 and
with other applicable state and federal laws. An out-of-state
bank that will be the resulting bank in the interstate merger
transaction shall provide satisfactory evidence to the
commissioner of compliance with Section 201.102.
(c) An out-of-state bank that does not operate a branch in this
state may not establish and maintain a branch in this state
through the acquisition of a branch of an existing Texas bank
except as provided by Section 203.002.
Added by Acts 1999, 76th Leg., ch. 344, Sec. 1.001, eff. Sept. 1,
1999.
Sec. 203.004. LIMITATION ON CONTROL OF DEPOSITS. (a) An
interstate merger transaction is not permitted if, on
consummation of the transaction, the resulting bank, including
all depository institution affiliates of the resulting bank,
would control 20 percent or more of the total amount of deposits
in this state held by all depository institutions in this state.
(b) The commissioner may request and the applicant shall provide
supplemental information to the commissioner to aid in a
determination under this section, including information that is
more current than or in addition to information in the most
recently available summary of deposits, reports of condition, or
similar reports filed with or produced by state or federal
authorities.
Added by Acts 1999, 76th Leg., ch. 344, Sec. 1.001, eff. Sept. 1,
1999.
Sec. 203.005. REQUIRED AGE OF ACQUIRED BANK. (a) An
out-of-state bank may not acquire a Texas bank in an interstate
merger transaction if the Texas bank has not been in existence
and in continuous operation for at least five years as of the
effective date of the interstate merger transaction. However,
this section does not apply if the acquiring out-of-state bank
could establish a de novo branch in this state pursuant to
Section 203.002.
(b) For purposes of this section:
(1) a bank that is the successor as a result of merger or
acquisition of all or substantially all of the assets of a prior
bank is considered to have been in existence and continuously
operated during the period of its existence and continuous
operation as a bank and during the period of existence and
continuous operation of the prior bank; and
(2) a bank effecting a purchase and assumption, merger, or
similar transaction with or supervised by the Federal Deposit
Insurance Corporation or its successor is considered to have been
in existence and continuously operated during the existence and
continuous operation of the bank with respect to which the
transaction was consummated.
Added by Acts 1999, 76th Leg., ch. 344, Sec. 1.001, eff. Sept. 1,
1999.
Sec. 203.006. ADDITIONAL BRANCHES. An out-of-state bank that
has established or acquired a branch in this state under this
chapter may establish or acquire additional branches in this
state to the same extent that a Texas state bank may establish or
acquire a branch in this state under applicable state and federal
law.
Added by Acts 1999, 76th Leg., ch. 344, Sec. 1.001, eff. Sept. 1,
1999.
Sec. 203.007. EXAMINATIONS; PERIODIC REPORTS. (a) The banking
commissioner may make examinations of a branch established and
maintained in this state pursuant to this chapter by an
out-of-state bank as the banking commissioner considers necessary
to determine whether the branch is being operated in compliance
with the laws of this state and in accordance with safe and sound
banking practices. Sections 31.105-31.107 or 96.054-96.057, as
appropriate, apply to the examinations.
(b) The commissioner may prescribe requirements for periodic
reports from an out-of-state bank that operates a branch in Texas
pursuant to this chapter. Reporting requirements prescribed by
the commissioner under this section must be:
(1) consistent with the reporting requirements applicable to
Texas state banks or state savings banks, as appropriate; and
(2) appropriate to discharge the responsibilities of the
commissioner under this chapter.
Added by Acts 1999, 76th Leg., ch. 344, Sec. 1.001, eff. Sept. 1,
1999.