Definitions in the Finance Code, Title 3, Subtitles A and G, are incorporated herein by reference. As used in this subchapter and in Finance Code, Chapter 34, concerning investments and loans, the following words and terms shall have the following meanings, unless the context clearly indicates otherwise.

1. (1) Unimpaired capital and surplus--A state bank's core capital, equal to its Tier 1 capital calculated under the federal risk-based capital standards, and referred to as Tier 1 capital in this chapter.
2. (2) Federal risk-based capital standards--The federal system for calculating a bank's equity capital and its specified components, set forth in appendix A to 12 C.F.R. part 325 (or appendix A to 12 C.F.R. part 208 in the case of a bank that is a member of the Federal Reserve System).
3. (3) Tier 1 capital--A state bank's unimpaired capital and surplus. A state bank's Tier 1 capital is calculated under the federal risk-based capital standards, is reported in the bank's most recent call report, and is periodically re-calculated as provided by §12.11 of this title (relating to Calculation of Lending Limits).
4. (4) Call report--The federal Consolidated Report of Condition and Income required by and filed under 12 U.S.C. §1817 (or under 12 U.S.C. §324 in the case of a bank that is a member of the Federal Reserve System), or a report of financial condition and results of operations of a state bank required by the banking commissioner under Finance Code, §31.108.

5. (5) Control--Control is presumed to exist when a person directly or indirectly, or acting through or together with one or more persons:

   1. (A) owns, controls, or has the power to vote 25 percent or more of any class of voting securities of another person;
   2. (B) controls, in any manner, the election of a majority of the directors, trustees, or other persons exercising similar functions of another person; or
   3. (C) has the power to exercise a controlling influence over the management or policies of another person.
6. (6) Borrower--A person who is named as a borrower, obligor, or debtor in a loan or extension of credit, or any other person, including but not limited to a drawer, endorser, or guarantor who is considered to be a borrower under the direct benefit, source of repayment, or common enterprise tests set forth in §12.9 of this title (relating to Aggregation and Attribution).
7. (7) Sale of Federal funds--A transaction between depository institutions involving the transfer of immediately available funds resulting from credits to deposit balances at Federal Reserve Banks, or from credits to new or existing deposit balances due from a correspondent depository institution.

Source Note:The provisions of this §12.2 adopted to be effective September 6, 2007, 32 TexReg 5655.