2005 Texas Finance Code CHAPTER 203. INTERSTATE BANK MERGERS AND BRANCHING

FINANCE CODE

CHAPTER 203. INTERSTATE BANK MERGERS AND BRANCHING


	§ 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, § 1.001, eff. Sept. 1, 
1999.     


	§ 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.

Added by Acts 1999, 76th Leg., ch. 344, § 1.001, eff. Sept. 1, 
1999.     


	§ 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, § 1.001, eff. Sept. 1, 
1999.     


	§ 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, § 1.001, eff. Sept. 1, 
1999.     


	§ 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, § 1.001, eff. Sept. 1, 
1999.     


	§ 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, § 1.001, eff. Sept. 1, 
1999.     


	§ 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, § 1.001, eff. Sept. 1, 
1999.