Sec. 32.502.  CONVERSION OF FINANCIAL INSTITUTION INTO STATE BANK.  (a)  A financial institution, as that term is defined by Section 201.101, may apply to the banking commissioner for conversion into a state bank on a form prescribed by the banking commissioner and accompanied by any required fee if the institution follows the procedures prescribed by the laws of the United States, this state, another state, or another country governing the exit of the financial institution for the purpose of conversion into a state bank from the regulatory system applicable before the conversion.  A banking association or limited banking association may convert its organizational form under this section.
(b)  A financial institution applying to convert into a state bank may receive a certificate of authority to do business as a state bank if the banking commissioner finds that:
(1)  the financial institution is not engaging in a pattern or practice of unsafe and unsound banking practices;
(2)  the financial institution has adequate capitalization for a state bank to engage in business at the same locations as the financial institution is engaged in business before the conversion;
(3)  the financial institution can be expected to operate profitably after the conversion;
(4)  the officers and directors of the financial institution as a group have sufficient banking experience, ability, standing, competence, trustworthiness, and integrity to justify a belief that the financial institution will operate as a state bank in compliance with law;
(5)  each principal shareholder has sufficient experience, ability, standing, competence, trustworthiness, and integrity to justify a belief that the financial institution will be free from improper or unlawful influence or interference with respect to the financial institution's operation as a state bank in compliance with law; and
(6)  if the converting financial institution did not have general depository powers and the state bank will have those powers, the factors set forth in Section 32.003(b) are satisfied.
(c)  The banking commissioner may:
(1)  request additional information considered necessary to an informed decision under this section;
(2)  perform an examination of the converting financial institution at the expense of the converting financial institution;  and
(3)  require that examination fees be paid before a certificate of authority is issued.
(d)  In connection with the application, the converting financial institution must:
(1)  submit a statement of the law governing the exit of the financial institution from the regulatory system applicable before the conversion and the terms of the transition into a state bank;  and
(2)  demonstrate that all applicable law has been fully satisfied.
Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. Sept. 1, 1997.  Amended by Acts 1999, 76th Leg., ch. 344, Sec. 2.010, eff. Sept. 1, 1999.
Amended by: 
Acts 2007, 80th Leg., R.S., Ch. 237 (H.B. 1962), Sec. 23, eff. September 1, 2007.