Texas Senate Approves Bill to Permit Interstate Banking
LaGesse, David, American Banker
Texas Senate Approves Bill To Permit Interstate Banking
Texas Gov. Mark White on Wednesday opened the door for the state Legislature to consider bills on interstate banking and countywide branching--and the Senate promptly passed the proposals on a voice vote.
The governor added the proposals to the agenda of a special session of the Legislature, where committees in both houses already had begun work on the bills. Legislators and banking officials predict that the legislation also will pass the House before the special session ends in the first week of September.
Gov. White endorsed the concept of interstate banking and countywide branching in a speech Wednesday morning in Austin, said David Nesenholtz, an aide to the governor.
If passed and signed by Gov. White, the legislation should become effective 90 days after the close of the session-- or just before the end of the year. A state constitutional amendment permitting countywide branching would appear on the ballot in November.
Stock prices of Texas banks rose midday Wednesday as word of the governor's announcement spread, said Frank W. Anderson, a bank analyst with the investment firm of Weber, Hall, Sale & Associates, Dallas.
"It's definitely good news,' he said, noting the stock prices of Texas Commerce Bancshares, Houston, and Texas American Bancshares, Fort Worth, had gained more than 10% by noon.
First City Bancorporation of Texas Inc., Houston, and Interfirst Corp., Dallas, the most troubled of the large Texas holding companies, saw no increase in their stock prices by midafternoon Wednesday.
Talk of interstate banking already has centered on several potential acquisition candidates, including Allied Bancshares, Houston; Texas American; Texas Commerce; MCorp, Dallas; and the smaller National Bancshares Corp., San Antonio.
The choices are limited somewhat because Texas has permitted statewide holding companies since the early 1970s, creating a half-dozen companies with assets of more than $10 billion --and only three companies with assets between $2 billion and $10 billion, said Joseph H. Pratt, a research analyst with W.H. Newbold's Son & Co., Philadelphia.
So it will take interest from large banks in New York and California to see much action, he said.
New York banks known to have expressed interest in establishing Texas franchises include Citicorp, Manufacturers Hanover Trust Co., and Chase Manhattan Corp. A representative of Chase even spoke at a hearing in Austin on interstate banking in May. First Interstate Bancorp and Security Pacific Corp. are considered the lead California candidates to come into Texas.
While the stock of most Texas banks currently trades well below book value, nearly all has gained recently in hopes of interstate acquisitions. …