89R10918 EAS-F     By: Paxton S.B. No. 2906       A BILL TO BE ENTITLED   AN ACT   relating to limitations on the termination of banking services by   certain financial institutions.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Title 12, Business & Commerce Code, is amended by   adding Chapter 601A to read as follows:   CHAPTER 601A. LIMITATION ON TERMINATION OF BANKING SERVICES BY   FINANCIAL INSTITUTIONS          Sec. 601A.001.  DEFINITIONS. In this chapter:                (1)  "Department" means the Texas Department of   Banking.                (2)  "Financial institution" means:                      (A)  a bank chartered under state law, including   Chapter 32, Finance Code;                      (B)  a savings and loan association chartered   under Chapter 62, Finance Code;                      (C)  a state savings bank chartered under Chapter   92, Finance Code;                      (D)  a credit union chartered under Chapter 122,   Finance Code; or                      (E)  a trust company chartered under the laws of   this state.          Sec. 601A.002.  APPLICABILITY. This chapter applies only to   a financial institution or other lender that:                (1)  is formed or chartered under the laws of this   state; and                (2)  makes loans or other extensions of credit only to   customers:                      (A)  who are residents of this state; or                      (B)  that are businesses organized under the laws   of this state.          Sec. 601A.003.  NOTICE REQUIRED TO TERMINATE SERVICES. (a)   A financial institution may not terminate a bank account, line of   credit, or other banking instrument of a customer without:                (1)  providing notice to the customer and a reason for   the termination; and                (2)  subject to Subsection (c), allowing a reasonable   period of at least 30 days after the date of the notice required by   Subdivision (1), for a customer to voluntarily transfer accounts.          (b)  A financial institution may not terminate a bank   account, line of credit, or other banking instrument if a customer   has filed a timely appeal as described by Section 601A.004(b).          (c)  Subsection (a)(2) does not apply if:                (1)  the bank account, line of credit, or other banking   instrument is dormant or has a zero balance;                (2)  the bank account has had persistent overdrafts or   is habitually delinquent in payments; or                (3)  the financial institution has reason to believe   that the customer is engaged in criminal activity.          Sec. 601A.004.  REMEDIES. (a)  A customer who receives a   notification that the customer's bank account, line of credit, or   other banking instrument will be terminated may file an appeal with   the department.          (b)  An appeal is considered timely if filed not later than   the 10th business day after the date of notice for termination of   services described by Section 601A.003(a)(1).          (c)  The department shall review all termination of service   appeals for compliance. The department shall direct a financial   institution to reverse the termination if the department determines   that the termination is not authorized.           (d)  A customer may bring an action under this section   against a financial institution only after a determination by the   department.          (e)  If the customer proves that a financial institution   violated this chapter, the customer is entitled to recover:                (1)  declaratory relief under Chapter 37, Civil   Practice and Remedies Code, including costs and reasonable   attorney's fees under Section 37.009, Civil Practice and Remedies   Code; and                (2)  injunctive relief.          Sec. 601A.005.  RULEMAKING AUTHORITY. The Finance   Commission of Texas shall adopt rules to enforce this chapter.          Sec. 601A.006.  LIMITATION ON EFFECT OF CHAPTER. This   chapter does not subject a financial institution to damages or   other legal remedies to the extent the financial institution is   protected from those remedies under federal law.          SECTION 2.  This Act takes effect September 1, 2025.