Texas Administrative Code
Title 7 - BANKING AND SECURITIES
Part 2 - TEXAS DEPARTMENT OF BANKING
Chapter 21 - TRUST COMPANY CORPORATE ACTIVITIES
Subchapter D - TRUST COMPANY OFFICES
Section 21.42 - Establishment, Relocation and Closing of an Additional Office

Universal Citation: 7 TX Admin Code ยง 21.42

Current through Reg. 49, No. 38; September 20, 2024

(a) Establishment or relocation by notice. A trust company may establish or relocate an additional office pursuant to Finance Code, § RSA 182.203, by filing a written notice with the banking commissioner containing all information required by subsection (b) of this section, accompanied by the required filing fee pursuant to § RSA 21.2 of this title (relating to Filing and Investigation Fees), and notice of the submission must be published as required by subsection (d) of this section. A trust company filing notice of an additional office under this subsection may establish the additional office on the 31st day after the date the required notice and fee are received by the banking commissioner unless the banking commissioner gives notice in writing, prior to the expiration of that time period, that an earlier or later date is authorized or that additional information is required pursuant to subsection (c) of this section.

(b) Contents of notice. The notice filed under subsection (a) of this section must disclose:

(1) the name and home office location of the trust company requesting the additional office;

(2) the street address of the trust company's proposed additional office;

(3) a description of the activities proposed to be conducted at the proposed additional office;

(4) the desired effective date for establishment of the additional office;

(5) a certified copy of the resolution adopted by the trust company's board of directors authorizing the proposed additional office;

(6) the cost to be incurred in connection with the establishment of the additional office and a statement of the impact of such cost on the trust company's ability to meet liquidity requirements;

(7) a description of any actual proposed, or contemplated financial involvement by any officer, director, manager, managing participant, or principal shareholder or participant of the trust company with respect to establishing the additional office;

(8) evidence that the trust company has considered applicable federal law, if any; and

(9) such other information as the banking commissioner may require.

(c) Request for additional information. At any time before the 31st day after the date the notice required by subsection (a) of the section is filed, the banking commissioner may issue written notice to the trust company specifying a later date for establishing or relocating an additional office and requiring the submission of additional information and additional time for analysis. Upon issuance of a notice requiring the submission of additional information and additional time for analysis, the trust company may establish or relocate the additional office only on written approval of the banking commissioner.

(d) Public notice and participation.

(1) Within 14 days of the initial submission of the notice required under subsection (a) of this section, the trust company shall publish notice of the submission as required by § RSA 21.5 of this title (relating to Public Notice). Notice must be published in the community where the proposed additional office will be located and must specifically disclose the location of the proposed additional office.

(2) For a period of 14 days after publication of notice or such longer period as the banking commissioner may allow for good cause shown, the public may submit written comments or protests. Persons submitting comments will not be charged fees or costs, but are not entitled to further notice of or participation in the proceedings. Each protesting party has the rights and responsibilities set forth in subsections (f) and (g) of this section.

(e) Criteria for determining significant supervisory or regulatory concern. The banking commissioner may deny permission to establish or relocate an additional office of a trust company if the commissioner has significant supervisory or regulatory concern about the proposed transaction.

(1) In evaluating whether significant supervisory concerns exist regarding a proposed additional office, the banking commissioner shall consider the financial condition of the trust company, the financial effect of the additional office on the trust company, the management abilities of the trust company, and the history and prospects of the trust company and its affiliates regarding fulfillment of responsibilities to regulatory agencies and to the public. A request will ordinarily be denied if the trust company is in less than satisfactory financial condition as of its most recent examination.

(2) In evaluating whether significant regulatory concerns exist regarding a proposed additional office, the banking commissioner will consider the relevant marketplace and the convenience of the public in accessing desired trust services and preferred trustees. The banking commissioner will follow the principles that the marketplace normally is the best regulator of economic activity, and that healthy competition promotes a sound and more efficient trust company system that serves customers well. Accordingly, absent significant supervisory concerns, the general policy of the banking commissioner is to approve applications, requests and notices to establish and relocate additional offices, provided that approval would not otherwise violate applicable provisions of federal or state law (including any requirements for federal banking agency approval).

(3) In evaluating whether the banking commissioner should have significant supervisory or regulatory concerns as set forth in paragraphs (1) and (2) of this subsection, the banking commissioner will consider written material in the record, including the contents of the application, notice or request, comments on file, the department's files as they relate to the current financial condition of the trust company, and other data that the banking commissioner may properly officially notice. Specifically, the banking commissioner shall approve the establishment or relocation of an additional office if the following considerations are met:
(A) the department's files do not indicate significant supervisory concerns as they relate to the current financial condition of the trust company, including but not limited to its capital, asset quality, management, earnings and liquidity;

(B) the costs of establishing or relocating the office, including costs of purchasing or leasing the office site, necessary furnishings, staffing and equipment, do not significantly affect the operations of the trust company as a whole;

(C) the projected earnings appear reasonable and sufficient to support expenses attributable to the establishment and relocation of the office without jeopardizing the safety and soundness of the trust company;

(D) the depth and quality of management of the trust company and of the proposed additional office are sufficient to justify a belief that the trust company will operate in compliance with law;

(E) the trust company has demonstrated a responsiveness to recommendations made in past state and federal regulatory examinations or other regulatory findings and the trust company has generally been operated in substantial compliance with all applicable state and federal laws; and

(F) no areas of general supervisory concern exist as determined by the banking commissioner in the exercise of discretion.

(4) The banking commissioner shall direct the department to assemble, evaluate, and make a recommendation regarding all relevant documentation and data as set forth in this subsection on or before the 30th day after the date the application is accepted for filing.

(5) The banking commissioner shall either approve, conditionally approve, or deny the application, notice, or request on or before the 30th day after the date of the department's recommendation.

(f) Protest.

(1) A protest may be initiated by notifying the department in writing of the intent to protest the establishment of an additional office at the specified location within the time period allowed by subsection (d) of this section, accompanied by the filing fee as set forth in § RSA 21.2(c) of this title (relating to Filing and Investigation Fees). If the protest is untimely, the filing fee will be returned to the protesting party. If the protest is timely, the department will notify the applicant of the protest and mail or deliver a complete copy of the non-confidential sections of the application to the protesting party on or before the 14th day after receipt of the protest or the application, whichever occurs later.

(2) The protesting party shall file a detailed protest responding to each substantive statement contained in the notice on or before the 20th day after the date of receipt of the application. The protesting party's response must indicate with regard to each such statement whether it is admitted or denied. The applicant shall file a written reply to the detailed response on or before the 10th day after the date the response is filed. Both the detailed response and the reply thereto must be verified by affidavit and must contain a certificate of service on the opposing party. When applicable, statements in the response and in the reply may be supported by references to data available in sources of which official notice may properly be taken. Comments received by the department and any replies of the applicant to such comments will also be made available to the protesting party.

(3) The banking commissioner may extend any time period set forth in this subsection for good cause shown. Good cause includes, but is not limited to, failure of the department to furnish required documentation, forms, or information within a reasonable time to permit its effective use by the recipient, or failure of a party to timely serve a filed document on an opposing party. The filing date is the date the document is actually received by the department and not the date of mailing. Failure to timely file a required document is considered an abandonment of the application or protest, as applicable. Rule 21a, Texas Rules of Civil Procedure, governs the methods and manner of authorized service and the computation of time periods under this subsection.

(g) Hearing.

(1) The banking commissioner may not be compelled to hold a hearing prior to allowing or not allowing an additional office to be established. In the exercise of discretion, the banking commissioner may consider granting a hearing on a notice of additional office at the request of either the filing trust company or a protesting party. The banking commissioner may order a hearing even if no hearing has been requested.

(2) A party requesting a hearing must indicate with specificity what issues are involved that cannot be determined on the basis of the record compiled pursuant to subsection (e) of this section and why the issues cannot be so determined. The request for hearing and the banking commissioner's decision with regard to granting a hearing will be made a part of the record. If a hearing is not requested or if a request for hearing is denied, the banking commissioner will consider the notice in the manner set forth in and solely on the basis of the written record established pursuant to subsection (e) of this section.

(3) If a hearing is granted, the administrative law judge shall enter appropriate order(s) and conduct the hearing within 30 days after the date the hearing was granted, or as soon thereafter as is reasonably possible, under Chapter 9 of this title (relating to Rules of Procedure for Contested Case Hearings, Appeals, and Rulemakings) and the Administrative Procedure Act (Texas Government Code, Chapter 2001). Issues will be limited to those on which testimony is absolutely necessary, and the administrative law judge may require testimony to be submitted in written form and prefiled. No evidence will be received on matters that are not in dispute. No issues or evidence will be considered that are not relevant to the standards set forth in subsection (e) of this section or that are not supported by the notice, response, or reply. A proposal for decision, exceptions and replies to such proposal for decision, the final decision of the banking commissioner, and motions for rehearing are governed by Chapter 9 of this title.

(h) Closing an additional office.

(1) Subject to paragraph (2) of this subsection, at least 30 days prior to the date a trust company proposes to close an additional office, the trust company shall file written notice with the banking commissioner disclosing:
(A) the name and home office location of the trust company seeking to close the additional office location;

(B) the street address of the additional office location to be closed;

(C) the effective date of the proposed closing;

(D) evidence of distribution of written notice of closing to all customers and account holders at least 45 days prior to the proposed closing date.

(E) the place and street address of location where records from the closed office will be transferred;

(F) a copy of the resolution adopted by the trust company's board of directors authorizing the proposed closing of the additional location; and

(G) such other information as the banking commissioner may require.

(2) If the trust company must comply with notice requirements of federal banking law applicable to closing a branch office, in lieu of compliance with paragraph (1) of this subsection, the trust company may provide the banking commissioner with a copy of the closing notice filed with the appropriate federal banking regulator simultaneously with its filing.

(3) Once the additional office has been closed, the trust company may not reopen the additional office except upon notice or application for a new additional office in compliance with this section.

Disclaimer: These regulations may not be the most recent version. Texas may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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