Texas Insurance Code - Not Codified - Article 3.39. Authorized Investments And Loans For
Legal Research Home >
Texas Lawyer > Insurance Code - Not Codified > Texas Insurance Code - Not Codified - Article 3.39. Authorized Investments And Loans For
Art. 3.39. AUTHORIZED INVESTMENTS AND LOANS FOR "DOMESTIC"
LIFE INSURANCE COMPANIES.
Article repealed effective April 1, 2007
Part I. Authorized Investments
A life insurance company organized under the laws of this
state may invest its several funds, identified as follows, in the
following securities, respectively, and none other:
A. ANY OF ITS FUNDS AND ACCUMULATIONS
1. U. S. Bonds and Obligations Guaranteed by the United
States. The bonds, treasury bills, notes and certificates of
indebtedness of the United States or any other obligation or
security fully guaranteed as to principal and interest by the full
faith and credit of the United States.
2. Canadian Bonds. The bonds of the Dominion of Canada or any
province or city of the Dominion of Canada.
3. State, County and City Bonds. The bonds of any state,
county, or city of the United States.
4. County, City and School District Bonds. Any bonds or
interest-bearing warrants issued by authority of law by any county,
city, town, school district or other municipality or subdivision,
which is now or hereafter may be constituted or organized under the
laws of any state in the United States, and which is authorized to
issue such bonds and warrants under the Constitution and laws of the
state in which it is situated; provided legal provision has been
made by a tax to meet said obligations.
5. Bonds of Educational Institutions. Any bonds or
interest-bearing warrants issued by authority of law by any
educational institution which is now or hereafter may be
constituted or organized under the laws of any state in the United
States, and which is authorized to issue such bonds and warrants
under the Constitution and laws of the state in which it is
situated; provided legal provision has been made by a tax to meet
said obligations.
6. Revenue Bonds, etc., of Educational Institutions. The
bonds and warrants, including revenue and special obligations, of
any educational institution located in any state in the United
States when special revenue or income to meet the principal and
interest payments as they accrue upon such obligations shall have
been appropriated, pledged or otherwise provided by such
educational institution.
7. Bonds and Warrants of Municipally Owned Systems. The bonds
and warrants payable from designated revenues of any city, county,
drainage district, road district, town, township, village or other
civil administration, agency, authority, instrumentality, or
subdivision which is now or hereafter may be constituted or
organized under the laws of any state in the United States, and
which is authorized to issue such bonds and warrants under the
Constitution and laws of the state in which it is situated;
provided special revenue or income to meet the principal and
interest payments as they accrue upon such obligations shall have
been appropriated, pledged or otherwise provided by such
municipality.
8. Paving Certificates. Any paving certificates or other
certificates or evidence of indebtedness issued by any city in any
state in the United States and secured by a first lien on real
estate.
9. Bonds Issued Under Federal Farm Loan Act. Bonds issued
under and by virtue of the Federal Farm Loan Act approved July 17,
1916 (12 U.S.C.A. Sec. 641 et seq.), when such bonds are issued
against and secured by promissory notes, or obligations, the
payment of which is secured by mortgage, deed of trust, or other
valid lien upon unincumbered real estate situated in this state.
10. Corporate First Mortgage Bonds, Notes and Debentures.
(1) First mortgage bonds or first lien notes on real estate or
personal property: (a) of any solvent corporation which has not
defaulted in the payment of any debt within five (5) years next
preceding such investment; or (b) of any solvent corporation which
has not been in existence for five (5) consecutive years but whose
first mortgage bonds or first lien notes on real estate or personal
property are fully guaranteed by a solvent corporation which has
not defaulted in the payment of any debt within five (5) years next
preceding such investment; or (c) of any solvent corporation which
has not been in existence for five (5) consecutive years but whose
first mortgage bonds or first lien notes on real estate or personal
property are secured by leases or other contracts executed by a
solvent corporation which has not defaulted in the payment of any
debt within five (5) years next preceding such investment, the
required rentals or other required payments under which leases or
other contracts are sufficient in any and every circumstance to pay
interest and principal when due on such bonds or notes; or (d) of
any solvent corporation which has not been in existence for five (5)
consecutive years next preceding such investment, provided such
corporation has succeeded to the business and assets and has
assumed the liabilities of another corporation, and which
corporation and the corporation so succeeded have not defaulted in
the payment of any debt within five (5) years next preceding such
investment; or (2) in the notes or debentures of any such
corporation with a net worth of not less than Five Million Dollars
($5,000,000) where no prior lien exists in excess of 10 percent of
the net worth of such corporation, and, under the provisions of the
indenture providing for the issuance of such notes or debentures,
no such prior lien can be created in excess of 10 percent of the net
worth of such corporation, against the real or personal property of
such corporation at the time the notes or debentures were issued;
or (3) in the notes or debentures of any solvent corporation which
has not been in existence for five (5) consecutive years where no
prior lien exists, and, under the provisions of the indenture
providing for the issuance of such notes or debentures, no such
prior lien can be created against the real or personal property of
such corporation at the time the notes or debentures were issued,
but whose notes or debentures are secured by leases or other
contracts executed by a solvent corporation which has not defaulted
in the payment of any debt within five (5) years next preceding such
investment and has a net worth of at least Five Million Dollars
($5,000,000), the required rentals or other required payments under
which leases or other contracts are sufficient in any and every
circumstance to pay interest and principal when due on such bonds or
notes, or whose notes or debentures are fully guaranteed by any such
corporation; or (4) in the bonds, bills of exchange, or other
commercial notes or bills of any solvent corporation which has not
defaulted in the payment of any debt within five (5) years next
preceding such investment, or of any solvent corporation which has
not been in existence for five (5) consecutive years next preceding
such investment, provided such corporation has succeeded to the
business and assets and has assumed the liabilities of another
corporation, and which corporation and the corporation so succeeded
have not defaulted in the payment of any debt within five (5) years
next preceding such investment, and which corporation has a net
worth of not less than Fifty Million Dollars ($50,000,000) and has
no long-term indebtedness in excess of its net worth, as evidenced
by its latest published financial statements or other financial
data available to the public; but in no event shall the amount of
such investment in the bonds, notes, debentures, or other
obligations of any one such corporation exceed five percent (5%) of
the admitted assets of the insurance company making such
investment.
11. Shares of Savings and Loan Associations. The shares,
stock, share accounts or savings accounts, and investment
certificates of Savings and Loan Associations doing business in
this state where such association has qualified for participation
in insurance issued by the Federal Savings and Loan Insurance
Corporation; no such investment shall exceed twenty per cent (20%)
of the total assets of any such Individual Savings and Loan
Association.
12. Bank and Bank Holding Company Stocks. The stock of banks,
either state or national, that are members of the Federal Deposit
Insurance Corporation and the stock of bank holding companies as
defined in the Bank Holding Company Act of 1956 (12 U.S.C.A. 1841 et
seq.) as amended by the Bank Holding Company Act Amendments of 1970
(12 U.S.C.A. 1841 et seq., 1971 et seq.) enacted by the United
States Congress; no such investment shall exceed twenty per cent
(20%) of the total outstanding shares of the stock of any such bank
or bank holding company and in no event shall the amount of
investment in any such stock exceed ten per cent (10%) of the
admitted assets of the insurance company making such investment.
13. Debentures of Public Utility Corporations. The
debentures of any solvent public utility corporation which has not
defaulted in the payment of any debt within five (5) years next
preceding such investment, or of any solvent public utility
corporation which has not been in existence for five (5)
consecutive years next preceding such investment provided such
corporation has succeeded to the business and assets and has
assumed the liabilities of another such corporation, and which
public utility corporation and public utility corporation so
succeeded have not defaulted in the payment of any debt within five
(5) years next preceding such investment; provided further, that
such public utility corporation shall not have failed in any one of
the five (5) years next preceding such investment to have earned,
after taxes, including income taxes, and after deducting proper
charges for replacements, depreciation and obsolescence, a sum
applicable to interest on its outstanding indebtedness equal at
least to two times the amount of interest due for that year, or
where, in the case of issuance of new debentures, such earnings
applicable to interest are equal to at least two times the amount of
annual interest on such public utility corporation's obligations
after giving effect to such new financing; or, in the case of a
public utility corporation which has not been in existence for five
(5) consecutive years next preceding such investment but has
succeeded to the business and assets and has assumed the
liabilities of another such corporation, and which public utility
corporation and the public utility corporation so succeeded have
not failed in any one of the five (5) years next preceding such
investment to have earned, after taxes, including income taxes, and
after deducting proper charges for replacements, depreciation and
obsolescence, a sum applicable to interest on the outstanding
indebtedness equal to at least two times the amount of interest due
for that year, to where in the case of issuance of new debentures
such earnings applicable to interest are equal to at least two times
the amount of annual interest on such public utility corporation's
obligations after giving effect to such new financing; but in no
event shall the amount of such investment in debentures under this
Subdivision exceed five per cent (5%) of the admitted assets of the
insurance company making the investment.
14. Preferred Stock of Public Utility Corporations. The
preferred stock of any solvent public utility corporation which has
not defaulted in the payment of any debt within five (5) years next
preceding such investment, or of any solvent public utility
corporation which has not been in existence for five (5)
consecutive years next preceding such investment provided such
corporation has succeeded to the business and assets and has
assumed the liabilities of another corporation, and which public
utility corporation and the public utility corporation so succeeded
have not defaulted in the payment of any debt within five (5) years
next preceding such investment; provided further, that such public
utility corporation shall not have failed in any one of the five (5)
years next preceding such investment to have earned a sum
applicable to dividends on such preferred stock equal to at least
three times the amount of dividends due in that year, or, in the
case of issuance of new preferred stock such earnings applicable to
dividends are equal at least to three times the amount of the annual
dividend requirements after giving effect to such new financing,
and where the bonds and debentures are eligible investments for
such insurance company; or, in the case of a public utility
corporation which has not been in existence for five (5)
consecutive years next preceding such investment, but has succeeded
to the business and assets and has assumed the liabilities of
another such corporation, and which public utility corporation and
the public utility corporation so succeeded have not failed in any
one of the five (5) years next preceding such investment to have
earned a sum applicable to the dividends on such preferred stock
equal to at least three times the amount of dividends due in that
year, or, in the case of issuance of new preferred stock, such
earnings applicable to dividends are equal at least to three times
the amount of the annual dividend requirements after giving effect
to such new financing, and where the bonds and debentures are
eligible investments for such insurance company; provided that any
preferred stock so purchased shall be of an issue which is entitled
to first claim upon the net earnings of such public utility
corporation after deducting such sum as may be necessary to service
any outstanding bonds and debentures, but in no event shall the
amount of such investment in preferred stock under this Subdivision
exceed two and one-half per cent (2-1/2%) of the admitted assets of
the insurance company making the investment.
15. Securities Not Otherwise Specified. Notwithstanding any
expressed or implied prohibitions, a life insurance company may,
after the effective date of this amendment, invest any of its funds
and accumulations in investments which do not otherwise qualify
under any other provision of Chapter 3 of the Insurance Code;
provided, however, that the amount of any one such investment under
this Section shall not exceed one per cent (1%) of the admitted
assets of any such life insurance company; and provided further,
that the investments authorized by this Section shall not exceed
the lesser of (a) five per cent (5%) of its admitted assets, or (b)
the amount of its capital and surplus in excess of Two Hundred
Thousand Dollars ($200,000) as shown on its last annual statement
preceding the date of the acquisition of such investment as filed
with the State Board of Insurance.
Nothing herein shall be construed or applied so as to
authorize any life insurance company to invest any of its funds or
accumulations in real property unless already authorized to do so
by this Act or some other existing law of the State of Texas.
15A. Other Bonds. A company may also invest its funds and
accumulations in:
(1) bonds issued, assumed, or guaranteed by the
Inter-American Development Bank, the International Bank for
Reconstruction and Development (the World Bank), the African
Development Bank, the Asian Development Bank, and the International
Finance Corporation; and
(2) bonds issued, assumed, or guaranteed by the State of
Israel.
16. Securities Authorized by Special Acts of the Legislature.
Securities authorized under Articles: 842a; 842a-1; 881a-24;
1187a; 5890c; 6795b-1; 7880-19a; 8247a; 8280-133; 8280-134;
8280-137; 8280-138; and 8280-139 of the Revised Civil Statutes of
Texas.
17. Other Securities Specifically Authorized by Law.
(1) Equipment trust obligations or certificates that are
adequately secured or other adequately secured instruments
evidencing an interest in transportation equipment that is in whole
or in part within the United States and a right to receive
determined portions of rental, purchase, or other fixed obligatory
payments for the use or purchase of the transportation equipment;
and
(2) Such other securities as are now or may hereafter be
specifically authorized by law.
B. POLICY RESERVES AND SURPLUS
1. Specified Municipal Bonds. It may invest its policy
reserves and surplus over and above its capital in "Municipal
Bonds" issued under and by virtue of Chapter 280, Acts 1929, 41st
Legislature.
C. CAPITAL, SURPLUS AND CONTINGENCY FUNDS OVER AND ABOVE POLICY
RESERVES
It may invest its capital, surplus and contingency funds over
and above the amount of its policy reserves in the following
securities:
1. Capital Stock, Bonds, and other Obligations of
Corporations. The capital stock, bonds, bills of exchange, or
other commercial notes or bills and securities of any solvent
corporation which has not defaulted in the payment of any debt
within five (5) years next preceding such investment, or of any
solvent corporation which has not been in existence for five (5)
consecutive years next preceding such investment, provided such
corporation has succeeded to the business and assets and has
assumed the liabilities of another corporation, and which
corporation and the corporation so succeeded have not defaulted in
the payment of any debt within five (5) years next preceding such
investment.
2. Bonds or Notes of Educational or Religious Corporations.
The bonds or notes of any educational or religious corporation
where provision has been made for the payment of a sufficient amount
of the first weekly or monthly revenues thereof to an interest and
sinking fund account in a bank or trust company as an independent
paying agent.
3. Limitation of Investments. It may not invest in its own
capital stock nor in the stock of any one corporation to any extent
more than ten per cent (10%) of the amount of its own capital,
surplus, and contingent funds, nor in the stock of any
manufacturing corporation with a net worth of less than Twenty-Five
Thousand Dollars ($25,000), nor in the stock of any oil corporation
with a net worth of less than Five Hundred Thousand Dollars
($500,000); provided, however, that it may own and invest not more
than twenty-five per cent (25%) of its capital, surplus and
contingency funds in the capital stock of one fire and casualty
insurance company, provided such investment gives it a majority of
the outstanding stock of such fire and casualty insurance company;
and provided further, it may additionally invest that portion of
its surplus funds which is in excess of the greater amount of either
(a) ten per cent (10%) of its admitted assets as determined from its
latest annual statement on file with the State Board of Insurance or
(b) the minimum capital and surplus requirements for incorporating
a life insurance company under Chapter 3 of the Insurance Code, as
amended, as it may be amended, in the capital stock, bonds and other
obligations of any one or more solvent corporations.
4. Certain Life Income Interests.
(a) Life income interest in an irrevocable express
testamentary trust that has as the fee simple recipient of all the
corpus of the trust one or more Texas public charities, Texas
churches, Texas educational institutions or Texas scientific
institutions; provided each recipient is recognized by the
Internal Revenue Service of the United States as exempt from
payment of income taxes and provided further that (1) the corpus of
any such trust is in whole or in part composed of interests in real
estate, stocks, bonds, debentures and other securities of an
aggregate total value of not less than $5,000,000; and (2) the
corpus of any such trust produces annual income of not less than
$100,000.
(b) No life insurance company's interest in any such trust
shall exceed ten per cent (10%) of its admitted assets.
(c) Before such interest shall be acquired, satisfactory
evidence shall be presented to the Commissioner of Insurance as
follows:
(1) That the interest is subject to and recognized as
transferable,
(2) That the interest is capable of reasonable valuation,
(3) That a market for sale of such interest exists,
(4) That the life income interest is supported by life
insurance in an amount not less than its admitted value and in form
approved by the Commissioner of Insurance.
(d) In valuing such interest on its books, the life
insurance company shall value the interest only on the basis of the
lesser of, (1) the recognized market established in accordance with
Section (c)(3) above, or (2) the ratio that such fractional life
income interest in the income of the trust bears to the total market
value of the properties held by the trust that are of the type of
property a life insurance company can lawfully acquire under the
investment statutes of the State of Texas.
D. CAPITAL, SURPLUS AND CONTINGENCY FUNDS NOT TO EXCEED 10%
1. Capital Stock of Other Insurance Corporations. It may
invest not to exceed ten per cent (10%) of its capital, surplus, and
contingency funds, in not more than twenty per cent (20%) of the
capital stock of any other insurance company, now or hereafter
organized under this Chapter, whose principal business is the
reinsurance, either partially or wholly, of risks ceded to it by
other life insurance companies. The investment herein authorized
may be made by purchase of stock then issued and outstanding or by
subscription to and payment for the increase in the capital stock of
such reinsurance corporation.
E. MINIMUM CAPITAL AND SURPLUS
1. Requirement as to Investment of Minimum Capital and
Surplus. Notwithstanding other provisions of this Article 3.39 of
this Code, the capital and surplus of a company hereafter organized
under Article 3.02 of this Code and the free surplus of a company
hereafter organized under Article 11.01 of this Code shall, at the
time of incorporation, consist only of lawful money of the United
States, or bonds of the United States, or of this state, or of any
county or incorporated municipality thereof, or government insured
mortgage loans which are otherwise authorized by this Chapter, and
shall not include any real estate; provided, however, that fifty
per cent (50%) of the minimum capital may be invested in first
mortgage real estate loans; and the minimum capital of a company
hereafter organized under said Article 3.02 and the minimum free
surplus of a company hereafter organized under said Article 11.01
at all times shall be maintained in cash or in the same classes of
investments. After the granting of charter the surplus in excess of
such One Hundred Thousand Dollars ($100,000) may be invested as
otherwise provided in this Code for Stock Companies.
F. GENERAL
1. Investment in Foreign Securities. Any such company
legally authorized to transact business in a foreign country may
invest in the same kind of securities of said country as
hereinbefore authorized in the United States of America for an
aggregate amount not exceeding the reserve on the business in force
in said country.
2. Investments to be Approved by Board of Directors. No
investment shall be made by any such insurance company, unless the
same shall first have been authorized by the Board of Directors or
by a committee charged with the duty of supervising such
investments.
3. Investments of Companies Reinsured. In any case in which a
life insurance company organized under the laws of this state shall
reinsure the business and take over the assets of another life
insurance company, either domestic or foreign, all investments of
such reinsured company that were authorized, when made, by the laws
of the state in which it was organized, as proper securities for
investment of the funds of a life insurance company, and which are
taken over by such reinsuring company, shall be considered as valid
securities of such reinsuring company under the laws of this state,
provided such investments are approved by the Board of Insurance
Commissioners of this state, and the same are taken over on terms
satisfactory to said Board; and upon the condition that the Board
of Insurance Commissioners shall have the power to require the
reinsuring company to dispose of such investments upon such notice
as it may deem reasonable.
4. Not to Invest in Stock Subject to Assessment. No such
insurance company shall invest any of its funds in any stock on
account of which the holder or owner thereof may in any event be or
become liable to any assessment except for taxes.
5. Certain Investment Privileges are Cumulative. The
investment powers conferred by Paragraphs Nos. 11 and 12, Section
A, are in addition to those conferred by Paragraphs Nos. 1, 2 and 3,
Section C, and are not to be construed as restricting the powers
already granted by said Paragraphs Nos. 1, 2 and 3 of Section C and
Paragraphs Nos. 11 and 12, Section A, and the powers conferred
herein are cumulative with respect to Paragraphs Nos. 1, 2 and 3,
Section C, and the powers conferred therein.
Part II. Authorized Loans
A life insurance company organized under the laws of this
state may loan its several funds identified as follows, taking as
collateral security for the payment of such loans the securities
named below, and none other.
A. ANY OF ITS FUNDS ACCUMULATIONS
Such company may loan any of its funds and accumulations on
the following securities:
1. First Liens Upon Real Estate. First liens upon real
estate, the title to which is valid and provided the amount of the
loan does not exceed: (a) seventy-five (75%) per cent of the value
of such real estate; or (b) ninety (90%) per cent of the value of
such real estate if it contains only a dwelling designed
exclusively for occupancy by not more than four families for
residential purposes; or (c) ninety-five (95%) per cent of the
value of such real estate if it contains only a dwelling designed
exclusively for occupancy by not more than four families for
residential purposes, and the portion of the unpaid balance of such
loan which is in excess of an amount equal to eighty (80%) per cent
of such value is guaranteed or insured by a mortgage insurance
company qualified to do business in the State of Texas; provided,
however, that loans in excess of seventy-five (75%) per cent of the
value of such real estate authorized under (b) or (c) hereof shall
not be originated by such company; provided, however, that the
aggregate amount of loans secured by first liens on real estate to
any one corporation, company, partnership, individual, or any
affiliated person or group may not exceed ten (10%) per cent of the
admitted assets of such insurer, and provided further that the
amount of any such single loan secured by a first lien on real
estate may not exceed five (5%) per cent of the admitted assets of
the insurer. The limitation provided by this subsection shall not
apply to any first lien on real estate where the Commissioner of
Insurance finds that: (1) the making or acquiring of such lien is
beneficial to and protects the interest of the insurer and (2) no
substantial damage to the policyholders and creditors of such
insurer appears probable from the taking or acquiring of such lien.
2. First Liens Upon Leasehold Estates. First liens upon
leasehold estates in real property and improvements situated
thereon, the title to which is valid; provided that the duration of
any loan upon such leasehold estates shall not exceed a period equal
to four-fifths (4/5) of the then unexpired term of such leasehold
estate, provided the unexpired term of the leasehold estate must
extend at least ten (10) years beyond the term of the loan, and any
such loan shall be payable only in equal monthly, quarterly,
semi-annual or annual installments, on principal and interest
during a period not exceeding four-fifths (4/5) of the then
unexpired term of such leasehold estate.
3. Collateral Securities. Upon any obligation secured
collaterally by any such first liens on real estate or leasehold
estates.
4. Policy Loans. Security of its own policies. No loan on
any policy shall exceed the reserve values thereof.
5. Other Securities. It may loan any of its funds and
accumulations, taking as collateral to secure the payment of such
loan, any of the securities named or referred to in Part 1 of this
Article 3.39 above in which it may invest any of its funds and
accumulations.
6. Restrictions as to Value of Real Estate Removed Where
Loans Insured by the United States. The foregoing restrictions as
to the value of the real estate security compared to the amount
loaned thereon and as to the duration of such loans shall not be
applied to loans if the entire amount of the indebtedness is insured
or guaranteed in any manner by the United States, the Federal
Housing Administration pursuant to the National Housing Act of
1934, as amended (12 U.S.C.A. Sec. 1701 et seq.), or by the State of
Texas, or, if not wholly insured or guaranteed, the difference
between the entire amount of the indebtedness and that portion
thereof insured or guaranteed by the United States, the Federal
Housing Administration pursuant to the National Housing Act of
1934, as amended, or by the State of Texas, would not exceed the
amount of loan permissible under said restrictions.
7. Loans to be Authorized by Board of Directors. No loan,
except policy loans, shall be made by any such insurance company
unless the same shall first have been authorized by the Board of
Directors or by a committee charged with the duty of supervising
such loans.
8. Insurance Requirements. If any part of the value of
buildings is required to be included in the value of such real
estate to attain the minimum authorized value of the security, such
buildings shall be insured against loss by fire in a company
authorized to transact business in the state in which such real
estate is located, or in a company recognized as acceptable for such
purpose by the insurance regulatory official of the state in which
such real estate is located, which insurance shall be in an amount
of at least fifty per cent (50%) of the value of such buildings;
provided, that the insurance coverage need not exceed the
outstanding balance owed to the lending company when the
outstanding balance falls below fifty per cent (50%) of the value of
the buildings. The loss clause shall be payable to such company.
B. CAPITAL, SURPLUS AND CONTINGENCY FUNDS OVER AND ABOVE POLICY
RESERVES
1. Capital Stock, Bonds, and Other Obligations of Solvent
Corporations, and Educational or Religious Corporations. It may
loan its capital, surplus, and contingency funds, or any part
thereof over and above the amount of its policy reserves, taking as
security therefor the capital stock, bonds, bills of exchange, or
other commercial notes or bills and the securities of any solvent
corporation which has not defaulted in the payment of any debt
within five (5) years next preceding such investment; or of any
solvent corporation which has not been in existence for five (5)
consecutive years next preceding such investment, provided such
corporation has succeeded to the business and assets and has
assumed the liabilities of another corporation, and which
corporation and the corporation so succeeded have not defaulted in
the payment of any debt within five (5) years next preceding such
investment; or in the bonds or notes of any Educational or
Religious Corporation where provision has been made for the payment
of a sufficient amount of the first weekly or monthly revenues
thereof to an interest and sinking fund account in a bank or trust
company as an independent paying agent; provided, the market value
of such stock, bills of exchange, or other commercial notes or bills
and securities shall be at all times during the continuance of such
loan at least fifty per cent (50%) more than the sum loaned thereon;
provided that it shall not take as collateral security for any loan
its own capital stock, nor shall it take as collateral security for
any loan the stock of any one corporation to any extent more than
ten per cent (10%) of the amount of its own capital, surplus, and
contingency funds, nor shall it take as collateral security for any
loan the stock of any manufacturing corporation with a net worth of
less than Twenty-Five Thousand Dollars ($25,000), nor the stock of
any oil corporation with a net worth of less than Five Hundred
Thousand Dollars ($500,000); and provided further, that it shall
not take as collateral security for any such loan any stock on
account of which the holder or owner thereof may in any event be or
become liable to any assessment except for taxes.
Part III. Separate Accounts [Repealed]
Repealed by Acts 1983, 68th Leg., p. 4131, ch. 648, Sec. 3,
eff. Sept. 1, 1984.
Acts 1951, 52nd Leg., ch. 491. Amended by Acts 1955, 54th Leg., p.
916, ch. 363, Sec. 12; Acts 1959, 56th Leg., p. 54, ch. 29, Sec. 1;
Acts 1959, 56th Leg., p. 96, ch. 49, Sec. 3; Acts 1959, 56th Leg.,
p. 626, ch. 282, Sec. 1; Acts 1959, 56th Leg., p. 890, ch. 411, Sec.
1 to 3; Acts 1961, 57th Leg., p. 925, ch. 410, Sec. 1; Acts 1963,
58th Leg., p. 432, ch. 151, Sec. 1; Acts 1963, 58th Leg., p. 967,
ch. 389, Sec. 1; Acts 1965, 59th Leg., p. 375, ch. 181, eff. Aug.
30, 1965; Acts 1965, 59th Leg., p. 497, ch. 257, Sec. 1 to 10, eff.
Aug. 30, 1965; Acts 1967, 60th Leg., p. 1829, ch. 707, Sec. 1, eff.
Aug. 28, 1967; Acts 1969, 61st Leg., p. 229, ch. 91, Sec. 1, eff.
April 5, 1969; Acts 1969, 61st Leg., p. 2132, ch. 736, Sec. 1, eff.
June 12, 1969; Acts 1971, 62nd Leg., p. 1561, ch. 422, Sec. 1, eff.
Aug. 30, 1971; Acts 1971, 62nd Leg., p. 1668, ch. 472, Sec. 2, eff.
Aug. 30, 1971; Acts 1973, 63rd Leg., p. 398, ch. 176, Sec. 1, eff.
May 25, 1973; Acts 1973, 63rd Leg., p. 1739, ch. 631, Sec. 1, eff.
Aug. 27, 1973; Acts 1975, 64th Leg., p. 1109, ch. 418, Sec. 1, eff.
June 19, 1975; Acts 1977, 65th Leg., p. 202, ch. 101, Sec. 1, eff.
Aug. 29, 1977; Acts 1979, 66th Leg., p. 327, ch. 151, Sec. 2, eff.
May 11, 1979; Acts 1979, 66th Leg., p. 1217, ch. 589, Sec. 1, eff.
June 13, 1979.
Part I, Sec. A, Par. 15A amended by Acts 1985, 69th Leg., ch. 542,
Sec. 4, eff. Aug. 26, 1985; amended by Acts 1991, 72nd Leg., ch.
408, Sec. 8, eff. Aug. 26, 1991.
Article: 3.18 3.28 3.29 3.31 3.32 3.33 3.38 3.39 3.39a 3.40 3.40-1 3.41 3.41a 3.49-3 3.50-7A
Last modified: August 11, 2007
|
