Section 34.201 - Lending Limits(a) Without the prior written approval of the banking commissioner, the total loans and extensions of credit by a state bank to a person outstanding at one time may not exceed an amount equal to 25 percent of the bank's unimpaired capital and surplus. This limitation does not apply to: (1) liability as endorser or guarantor of commercial or business paper discounted by or assigned to the bank by its owner who has acquired it in the ordinary course of business;(2) indebtedness evidenced by bankers' acceptances as described by 12 U.S.C. Section 372 and issued by other banks;(3) indebtedness secured by a bill of lading, warehouse receipt, or similar document transferring or securing title to readily marketable goods, except that: (A) the goods must be insured if it is customary to insure those goods; and(B) the aggregate indebtedness of a person under this subdivision may not exceed an amount equal to 50 percent of the bank's unimpaired capital and surplus;(4) indebtedness evidenced by notes or other paper secured by liens on agricultural products in secure and properly documented storage in bonded warehouses or elevators if the value of the collateral is not less than 125 percent of the amount of the indebtedness and the bank's interest in the collateral is adequately insured against loss, except that the aggregate indebtedness of a person under this subdivision may not exceed an amount equal to 50 percent of the bank's unimpaired capital and surplus;(5) indebtedness of another depository institution arising out of loans with settlement periods of less than one week;(6) indebtedness arising out of the daily transaction of the business of a clearinghouse association in this state;(7) liability under an agreement by a third party to repurchase from the bank an investment security listed in Section 34.101(d) to the extent that the agreed repurchase price does not exceed the original purchase price to the bank or the market value of the investment security;(8) the portion of an indebtedness that this state, an agency or political subdivision of this state, the United States, or an instrumentality of the United States has unconditionally agreed to repay, purchase, insure, or guarantee;(9) indebtedness secured by securities listed in Section 34.101(d) to the extent that the market value of the securities equals or exceeds the indebtedness;(10) the portion of an indebtedness that is fully secured by a segregated deposit account in the lending bank;(11) loans and extensions of credit arising from the purchase of negotiable or nonnegotiable installment consumer paper that carries a full recourse endorsement or unconditional guarantee by the person transferring the paper if:(A) the bank's files or the knowledge of its officers of the financial condition of each maker of the consumer paper is reasonably adequate; and(B) an officer of the bank designated for that purpose by the board certifies in writing that the bank is relying primarily on the responsibility of each maker for payment of the loans or extensions of credit and not on a full or partial recourse endorsement or guarantee by the transferor;(12) the portion of an indebtedness in excess of the limitation of this subsection that is fully secured by marketable securities or bullion with a market value at least equal to the amount of the overage, as determined by reliable and continuously available price quotations, except that the exempted indebtedness or overage of a person under this subdivision may not exceed an amount equal to 15 percent of the bank's unimpaired capital and surplus;(13) indebtedness of an affiliate of the bank if the transaction with the affiliate is subject to the restrictions and limitations of 12 U.S.C. Section 371c;(14) indebtedness of an operating subsidiary of the bank other than a subsidiary described by Section 34.103(c)(2); and(15) the portion of the indebtedness of a person secured in good faith by a purchase money lien taken by the bank in exchange for the sale of real or personal property owned by the bank if the sale is in the best interest of the bank.(b) The finance commission may adopt rules to administer this section, including rules to: (1) define or further define terms used by this section;(2) establish limits, requirements, or exemptions other than those specified by this section for particular classes or categories of loans or extensions of credit; and(3) establish collective lending and investment limits.(c) The banking commissioner may determine whether a loan or extension of credit putatively made to a person will be attributed to another person for purposes of this section.Amended By Acts 2007, 80th Leg., R.S., Ch. 110, Sec. 10, eff. 9/1/2007.Amended by Acts 2001, 77th Leg., ch. 528, Sec. 12, eff. 9/1/2001. Acts 1997, 75th Leg., ch. 1008, Sec. 1, eff. 9/1/1997.