H.B. No. 3806 amends Section 185.106 of the Finance Code, which outlines the duties of a state trust company under supervision. The bill specifies that during a period of supervision, a state trust company is prohibited from engaging in certain activities without prior approval from the banking commissioner or as dictated by the order of supervision. The activities that are restricted include disposing of assets, lending or investing funds, incurring debts, and soliciting new client accounts. Notably, the bill removes the prohibition on paying cash dividends to shareholders and adds new restrictions, including the inability to remove executive officers or directors and a new clause that prohibits engaging in any activity deemed by the banking commissioner to threaten the safety and soundness of the trust company.

The bill is set to take effect on September 1, 2025, following its passage in both the House and Senate with unanimous support. The changes aim to enhance the regulatory framework governing state trust companies under supervision, ensuring their operations remain stable and secure during periods of oversight.

Statutes affected:
Introduced: Finance Code 185.106 (Finance Code 185)
House Committee Report: Finance Code 185.106 (Finance Code 185)
Engrossed: Finance Code 185.106 (Finance Code 185)
Senate Committee Report: Finance Code 185.106 (Finance Code 185)
Enrolled: Finance Code 185.106 (Finance Code 185)