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Texas Finance Code - Section 34.204. Lease Financing Transaction

Legal Research Home > Texas Lawyer > Finance Code > Texas Finance Code - Section 34.204. Lease Financing Transaction

§ 34.204. LEASE FINANCING TRANSACTION.  (a) Subject to 
rules adopted under this subtitle, a state bank may, directly or 
indirectly through an operating subsidiary, provide the equivalent 
of a financing transaction by acting as lessor under a lease for the 
benefit of a customer.
	(b)  Without the written approval of the banking 
commissioner to continue holding property acquired for leasing 
purposes under this subsection, the bank may not hold personal 
property more than six months or real property more than two years 
after the date of expiration of the original or any extended or 
renewed lease period agreed to by the customer for whom the property 
was acquired or by a subsequent lessee.
	(c)  A rental payment received by the bank in a lease 
financing transaction under this section is considered to be rent 
and not interest or compensation for the use, forbearance, or 
detention of money.  However, a lease financing transaction is 
considered to be a loan or extension of credit for purposes of 
Sections 34.201 and 34.202.

Acts 1997, 75th Leg., ch. 1008, § 1, eff. Sept. 1, 1997.  Amended 
by Acts 2001, 77th Leg., ch. 528, § 13, eff. Sept. 1, 2001.

Last modified: August 10, 2007