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   [10,129A] In the Matter of First State Bank, Bandera, Texas, Docket No. 90-134kk (11-5-90).

   FDIC issues order conditionally granting approval for waiver of cross-guaranty.

   [.1] Cross-Guaranty—Waiver—Applicable only to Applicant

   [.2] Cross-Guaranty—Waiver—Expiration

   [.3] Cross-Guaranty—Waiver—Applicable only to Specific Institution

   [.4] Cross-Guaranty—Waiver—Compliance with Federal Reserve Act Restrictions—Required

   [.5] Cross-Guaranty—Waiver—Revocation for Non-Compliance

In the Matter of
FIRST STATE BANK
BANDERA, TEXAS
(Insured Depository Institution)
Related to
CHAS. SCHREINER BANK
KERRVILLE, TEXAS
and
SOUTHWEST NATIONAL BANK
AUSTIN, TEXAS
(Commonly Controlled InsuredDepository Institutions)
ORDER CONDITIONALLY GRANTING APPROVAL FOR WAIVER OF CROSS-GUARANTY

FDIC-90-134kk

   BE ADVISED that the Board of Directors ("Board") of the Federal Deposit Insurance Corporation ("FDIC"), having fully considered the facts and information relating to the application for an exemption from assessment for losses incurred or reasonably anticipated to be incurred by the FDIC in connection with the default of Chas. Schreiner Bank, Kerrville, Texas, and Southwest National Bank, Austin, Texas ("Failed Institutions"), filed pursuant to the provisions of section 5(e)(5)(A) of the Federal Deposit Insurance Act ("Act"), 12 U.S.C. §1815(e)(5)(A), by Schreiner Bancshares, Inc. ("Applicant"), the holding company of First State Bank, Bandera, Texas ("Insured Institution"), relating to the proposal by B & G Investment Company, San Antonio, Texas ("Purchaser"), to acquire the Insured Institution, has concluded that approval of the application for exemption should be granted, subject to the conditions and restrictions set forth below.

   IT IS THEREFORE ORDERED, that this ORDER CONDITIONALLY GRANTING APPROVAL FOR WAIVER OF CROSS-GUARANTY ("ORDER") is conditional upon the acquisition of control of the Insured Institution by the Purchaser within six months from the date of issuance of this ORDER, and, absent such acquisition within that time period, this ORDER will become null and void, unless, upon the written request of the Applicant or Purchaser, the FDIC grants an extension of that time period.

   [.1] IT IS FURTHER ORDERED, that this ORDER will remain in effect only so long as the Insured Institution is controlled by the Applicant or Purchaser, and its applicability may not be conveyed or otherwise transferred by the Applicant or Purchaser.

   [.2] IT IS FURTHER ORDERED, notwithstanding the foregoing, that this exemption shall expire two years from the date of default of the Failed Institutions.

   [.3] IT IS FURTHER ORDERED, that the exemption granted by this ORDER will apply only to losses incurred or reasonably anticipated to be incurred from the default of, or FDIC assistance to, the Failed Institutions. Liability for loss resulting from the default of, or FDIC assistance to, any other insured depository institution controlled by Applicant will remain with all other commonly controlled insured depository institutions, including the Insured Institution.

   [.4] IT IS FURTHER ORDERED, that during the life of this ORDER, the Insured Institution, the Applicant, and all other insured depository institution affiliates controlled by the Applicant shall comply fully with the restrictions of sections 23A and 23B of the Federal Reserve Act, 12 U.S.C. §§ 371c and 371c-1, without regard to section 23A(d)(1) of the Federal Reserve Act, 12 U.S.C. §371c(d)(1).

   [.5] IT IS FURTHER ORDERED, that should the FDIC determine that the Insured Institution, the Applicant, or any insured depository institution affiliates controlled by the Applicant, fail to comply fully with the aforesaid restrictions, the FDIC shall have the right to revoke this exemption, after giving the Applicant written notice of said revocation and a reasonable opportunity to be heard on the matter.

   By direction of the Board of Directors.

   Dated at Washington, D.C. this 5th day of November, 1990.

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