FINANCE CODE
CHAPTER 94. LOANS AND INVESTMENTS
SUBCHAPTER A. LIMITATIONS ON LOANS
§ 94.001. LOANS TO ONE BORROWER. (a) The finance
commission by rule may limit loans to one borrower. Those limits
may not be less restrictive than the limits imposed on savings
associations under Section 5(u), Home Owners' Loan Act (12 U.S.C.
Section 1464(u)).
(b) A savings bank may not make loans to one borrower to a
greater extent than:
(1) permitted by rule adopted under Subsection (a);
or
(2) a savings association is permitted under Section
5(u), Home Owners' Loan Act (12 U.S.C. Section 1464(u)).
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997. Amended
by Acts 2001, 77th Leg., ch. 867, § 53, eff. Sept. 1, 2001.
§ 94.002. COMMERCIAL LOANS. (a) Subject to rules
adopted by the finance commission, a savings bank may lend or invest
not more than 40 percent of the savings bank's total assets in
commercial loans.
(b) In this section, "commercial loan" means a loan that:
(1) is for business, commercial, corporate, or
agricultural purposes; and
(2) is not a real property loan.
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997. Amended
by Acts 2001, 77th Leg., ch. 867, § 54, eff. Sept. 1, 2001.
SUBCHAPTER B. LOAN EXPENSES
§ 94.051. BORROWER PAYMENT OF LOAN EXPENSES. Subject to
Section 94.052, a savings bank may require a borrower to pay all
reasonable expenses incurred in connection with making, closing,
disbursing, extending, readjusting, or renewing a loan.
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997.
§ 94.052. CONSUMER LOANS. In the case of a consumer
loan:
(1) a savings bank may charge a borrower the
reasonable value of services rendered in connection with making the
loan; and
(2) an expense charged a borrower must be:
(A) necessary and proper for the protection of
the lender; and
(B) actually incurred in connection with making
the loan.
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997.
§ 94.053. COLLECTION OF LOAN EXPENSES. An expense
payment authorized by this subchapter may be:
(1) collected by the savings bank from the borrower
and:
(A) retained by the savings bank; or
(B) paid to a person rendering a service for
which a charge was made, including an officer, director, or
employee of the savings bank rendering the service; or
(2) paid directly by the borrower to the person
rendering the service.
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997.
§ 94.054. CHARACTER OF LOAN EXPENSE PAYMENTS. An
expense payment authorized by this subchapter is not interest or
compensation charged by a savings bank for the loan of money.
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997.
SUBCHAPTER C. LOAN PAYMENTS
§ 94.101. PENALTY FOR PREPAYMENT OR LATE PAYMENT. A
savings bank may charge a penalty for a prepayment of or late
payment on a loan.
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997.
§ 94.102. APPLICATION OF PREPAYMENTS TO LOAN
INSTALLMENTS. Unless otherwise agreed in writing, a savings bank
shall apply:
(1) a prepayment of principal to the final installment
of the obligation until the final installment is fully paid; and
(2) additional prepayments to installments in the
inverse order of their maturity.
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997.
SUBCHAPTER D. CHARGES RELATING TO REAL PROPERTY LOANS
§ 94.151. ADVANCES PAID BY SAVINGS BANK. (a) A savings
bank may pay taxes, assessments, insurance premiums, and similar
charges for the protection of the savings bank's interest in
property that secures a real property loan of the savings bank.
(b) A payment under Subsection (a) is an advance, and the
savings bank may:
(1) carry the payment on the savings bank's books as an
asset of the savings bank for which the savings bank may charge
interest; or
(2) add the payment to the unpaid balance of the loan
to which it applies as of the first day of the month in which the
payment is made.
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997.
§ 94.152. ADVANCES ARE LIEN ON PROPERTY. A payment
under Section 94.151 is a lien against the real property that
secures the loan for which it is made.
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997.
§ 94.153. PAYMENT OF ESTIMATED CHARGES BY
BORROWER. (a) To enable the savings bank to pay charges as they
become due, a savings bank may require a borrower to pay monthly in
advance, in addition to interest and principal, an amount equal to
one-twelfth of the estimated annual taxes, assessments, insurance
premiums, and other charges on the real property that secures a
loan.
(b) A savings bank may increase or decrease the amount of
the loan payment as necessary to meet the charges.
(c) A savings bank may:
(1) carry the payments in trust in an account; or
(2) credit the payments to the indebtedness and
advance the money for charges as the charges become due.
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997.
§ 94.154. RECORD OF CHARGES. A savings bank shall keep
a record of the status of taxes, assessments, insurance premiums,
and other charges on real property that secures the savings bank's
loans.
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997.
SUBCHAPTER E. INVESTMENT IN LOCAL SERVICE AREA
§ 94.201. REQUIRED INVESTMENTS. A savings bank shall
maintain in the savings bank's portfolio not less than 15 percent of
the savings bank's deposits from its local service area designated
under Section 94.202 in:
(1) first and second lien residential mortgage loans
or foreclosed residential mortgage loans originated in the savings
bank's local service area;
(2) home improvement loans;
(3) interim residential construction loans;
(4) mortgage-backed securities secured by loans in the
savings bank's local service area; and
(5) loans for community reinvestment.
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997.
§ 94.202. DESIGNATION OF LOCAL SERVICE AREA. (a) The
commissioner shall designate a savings bank's local service area at
the time of application for incorporation as or conversion to a
savings bank.
(b) Unless the commissioner and the savings bank otherwise
agree, a savings bank may rely on designation of the local service
area for the duration of corporate existence as a savings bank.
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997.
§ 94.203. RULES. The finance commission shall adopt
rules to implement this subchapter, including rules that define the
categories of loans and investments described by Section 94.201.
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997. Amended
by Acts 2001, 77th Leg., ch. 867, § 55, eff. Sept. 1, 2001.
§ 94.204. WAIVERS. The commissioner, in accordance
with rules adopted under Section 94.203, may grant a limited-term
waiver from the requirements of Section 94.201 if quality loans in
the categories described in that section are not available in a
savings bank's local service area.
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997.
SUBCHAPTER F. INVESTMENT IN EQUITY SECURITIES
§ 94.251. LIMITATIONS ON INVESTMENT IN EQUITY
SECURITIES. (a) A savings bank or a subsidiary may not invest in
an equity security unless the security qualifies as an investment
grade security under rules adopted by the finance commission.
(b) A savings bank may not invest in an equity security
unless the security is an eligible investment for a federal savings
and loan association.
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997. Amended
by Acts 2001, 77th Leg., ch. 867, § 56, eff. Sept. 1, 2001.
§ 94.252. INAPPLICABILITY OF LIMITATIONS. The
limitations under Section 94.251 do not apply to an equity security
issued by:
(1) a United States government-sponsored corporation,
including the Federal National Mortgage Association, the Federal
Home Loan Mortgage Corporation, and the Student Loan Marketing
Association; or
(2) a service corporation, an operating subsidiary, or
a finance subsidiary of the savings bank.
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997.
§ 94.253. RULES. The finance commission may adopt rules
necessary to implement this subchapter, including rules relating to
eligible investment criteria, investment diversification, and
resource management requirements.
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997. Amended
by Acts 2001, 77th Leg., ch. 867, § 57, eff. Sept. 1, 2001.
SUBCHAPTER G. INVESTMENT IN SUBSIDIARIES
§ 94.301. AUTHORIZATION. With the prior consent of the
commissioner and subject to rules adopted by the finance
commission, a savings bank may invest in a subsidiary corporation
created under general corporation law.
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997. Amended
by Acts 2001, 77th Leg., ch. 867, § 58, eff. Sept. 1, 2001.
§ 94.302. LIMITATION ON INVESTMENT IN
SUBSIDIARIES. (a) A savings bank may not invest in a subsidiary
corporation if the investment would cause the savings bank's
aggregate investments in subsidiaries to exceed an amount equal to
10 percent of the savings bank's total assets.
(b) For the purposes of Subsection (a), a savings bank's
aggregate investment in subsidiaries does not include amounts
invested in a subsidiary corporation the activities of which are
limited to activities that could be conducted directly by the
parent savings bank.
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997.
§ 94.303. REGULATION AND EXAMINATION OF
SUBSIDIARY. (a) The commissioner may regulate and examine a
subsidiary corporation in which a savings bank invests under
Section 94.301.
(b) The subsidiary corporation shall pay the cost of the
regulation and examination.
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997.
§ 94.304. RULES. The finance commission shall adopt
rules on permitted activities of a subsidiary corporation in which
a savings bank invests under Section 94.301.
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997. Amended
by Acts 2001, 77th Leg., ch. 867, § 59, eff. Sept. 1, 2001.
SUBCHAPTER H. PROPERTY OF SAVINGS BANK
§ 94.351. INVESTMENT IN BANKING PREMISES. Without
prior approval of the commissioner, a savings bank may invest not
more than an amount equal to the savings bank's regulatory capital
in real property, including a building or related facility, a
parking facility, or leasehold improvements for a rented facility,
for use by the savings bank as its banking premises.
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997.
§ 94.352. FORM OF SAVINGS BANK FACILITY. The finance
commission by rule adopted under Section 93.002 may approve a new
form of savings bank facility or authorize the commissioner to
approve a new form of savings bank facility if the commissioner does
not have a significant supervisory or regulatory concern regarding
the proposed facility.
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997.
§ 94.353. RECORD OF CHARGES ON REAL AND PERSONAL
PROPERTY. A savings bank shall keep a record of the status of
taxes, assessments, insurance premiums, and other charges on all
real and personal property owned by the savings bank.
Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997.
