Subcommittee on Interim Charge #4 
                             Wednesday, January 9, 2002 
                                     9:30 a.m. 
                           Capitol Extension, Room E1.016 
         Pursuant to a notice posted in accordance with Senate Rule  
         11.18, a public hearing of the Senate Committee on Business &  
         Commerce, Subcommittee on Interim Charge #4, was held on  
         Wednesday, January 9, 2002, in the Capitol Extension, Room  
         E1.016, at Austin, Texas. 
         MEMBERS PRESENT:                        MEMBERS ABSENT: 
         Senator Eliot Shapleigh, Chairman 
         Senator John Carona 
         Senator Troy Fraser 
         Senator Mike Jackson 
         Senator Eddie Lucio, Jr. 
         The chairman called the meeting to order at 9:31 a.m.  There  
         being a quorum present, the following business was transacted:   
         Chairman Shapleigh welcomed the members and those attending the  
         meeting.  He advised that, in accordance with interim charge #4,   
         the subcommittee will monitor trends in local lending practices  
         in all regions of the state.  The subcommittee shall determine  
         if the legislature should develop strategies to retain bank  
         deposits made by public institutions in Texas communities,  
         increase the number of bank "decision-making" centers in Texas,  
         increase the loan-to-deposit ratio in Texas, and develop  
         incentives for lending institutions to locate in all areas of  
         the state.   
         The chairman announced that at this meeting, the subcommittee  
         would hear an overview on issues from various state financial  
         regulators.  On February 13, the subcommittee will travel to  
         Waco to hear about issues of credit in rural and small  
         communities in Texas.  On March 14, the subcommittee will meet  
         in Dallas to hear about issues of venture capital, banking  
         centers, large credit and other lending issues common to urban  
         and fast-growth areas.  Then, in April the subcommittee will  
         meet in El Paso to look at trade corridor, border and minority  
         Chairman Shapleigh then called the first invited witness, Dr.  
         Steve Murdock, State Demographer, Texas A&M University, to  
         present an overview of recent and future trends in demographic  
         and socioeconomic characteristics of the Texas population as  
         they may affect lending needs and practices. 
         Following Dr. Murdock's testimony and response to members'  
         questions, the chairman called Dr. Ray Perryman, President of  
         the Perryman Group, to discuss the economic consequences of  
         inadequate bank credit in Texas. 
         Upon completion of Dr. Perryman's testimony, the chairman called  
         a panel to discuss credit availability issues; recent and  
         pending analyses; and studies relating to the subcommittee's  
         scope.  The panelists were: 
              James Pledger, Commissioner, Texas Savings and Loan  
              Randall James, Commissioner, Texas Department of Banking, 
              Leslie Pettijohn, Commissioner, Office of Consumer Credit  
         Commissioner, and 
              James Deese, Deputy Commissioner, Texas Credit Union  
         Following the panelists' testimony and response to members'  
         questions, Chairman Shapleigh called for public testimony,  The  
         witnesses testified in the order shown below: 
              Karen Neeley,  Independent Bankers Association of Texas,  
         Austin, Texas, 
              Jose Rodriguez, El Paso County Attorney, El Paso County  
         Attorney's Office, El Paso, 
              Rob Schneider, Consumers Union, Austin, Texas, and 
              Reymundo Ocanas, Texas CDCs, Austin, Texas. 
         There being no further business, at 1:15 p.m. Senator Shapleigh  
         moved that the Committee stand recessed subject to the call of  
         the chairman.  Without objection, it was so ordered.   
         Senator Eliot Shapleigh, Chairman 
         Barbara Henderson, Clerk