Sec. 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, Sec. 1, eff. Sept. 1, 1997. Amended by Acts 2001, 77th Leg., ch. 528, Sec. 13, eff. Sept. 1, 2001.
Last modified: September 28, 2016